This guest post is from Mrs. Money Mrs Money who writes about saving money and living green at her blog, The Ultimate Money Blog. Please stop by and check out her blog, or just subscribe to her blog.
My husband’s credit card history and mine couldn’t be more different. I’ll never forget my first credit card. It was a leopard print design from Capital One with a $300 credit limit. I got it when I turned 18 and kept it for about 5 years. I never carried a balance on it and made sure I didn’t charge things that I couldn’t pay off each month.
Unfortunately, my husband didn’t have such good financial habits, and one day I discovered his surprise debt shoebox that contained all sorts of collections notices. Needless to say, he didn’t have any active credit cards because his credit score was around 590. When the time came that we paid off all his debt, we checked his credit and found out his score had gone up to around 630. We decided to apply for a Capital One credit card, and he used that for a few years until they started giving us problems and we decided to cancel both cards that he had with them. We had worried about the effect it would have on his credit score, but we decided that the benefits outweighed the risks. We’d take our chances. Luckily, around the same time we canceled his card, we were able to find out that his credit score had made it into the high 600s because his debt collections had been paid off for a few years and he had made all his credit card payments on time.
Awhile back we contemplated getting another credit card in just his name to help his credit score, but ultimately decided that because we have one credit card with him listed as an authorized user that it would be more trouble than it was worth to go ahead and get him another one. About six months ago, we decided to refinance our mortgage, and when we did that we were able to check our credit scores. Mine was about 800 and his was around 760. We got an excellent rate on our mortgage, and it was great to know that even without a revolving line of credit his score was really good. I’m thankful that everything worked out in the end, even with our radically different credit card pasts.
Mr Credit Card’s thoughts – I asked Mrs Money to write about this experience because I think we can learn something from this. She started with a secured credit card, a small limit, always paid in full and got her credit score up to 800. Her husband’s credit score took a hit, but with some good habits (like paying on time), he has managed to build up a decent history. It takes time, but it ain’t as difficult as many make out to be.
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