James.c. It is not that I don't trust anyone who has been in debt, on the contrary I believe that after 5 frugal years they do come out of the process financially educated. However having a credit card could lead to temptation. If persons have managed without one for 5 years why start now? You could easily get a debit card and use that based on what spare funds you have in your bank account.
Human nature as it is does bring temptation and my advice is to avoid. I note that you will only keep £100 as the credit limit you want - that is sensible.
Regards, David Mond, Insolvency Practitioner for over 46 years. Personal Insolvency Practitioner of the year 2012, Personal Insolvency Practitioner of the year finalist 2013 & 2014 awarded by Insolvency & Rescue Magazine and 2015 finalist for Personal Insolvency Firm of the Year.
Reading timeforchange's post - I had also forgotten that if you book certain things with a credit card, you will be charged a percentage of the balance, something I don't agree with and would never pay for something where it was going to cost me extra.
However, it is not an instant APR loan as long as you pay it off in full when you get your statement (unless you have taken cash out!)
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
James C,you said you need the credit card to help your credit score,which I fully understand,but is your credit score not decent already given that they have allowed you the card??
I will get a credit card after my trust deed is finished,because it is handy to have and I hope that after 42 months paying into my trust deed I would like to think a lesson has been learned and as pointed out there are often things that you need to pay for before pay day(vet bills,car repairs etc etc)
Cant believe the limit though!!!
Discharged today the 8th feb 2012. View is much brighter now.
Continuing to rebuild our credit worthiness.
The credit agreement regulate loans and as a CC is bound by a CC agreement it is by law clasified as a 'credit loan facility' with high interest...and like a loan there are payment obligation periods - and the fact that one pay off the expenditure and own nothing doesn't change that it is a 'borrowing facility' giving you the option of an installment payment(specified like any other loan) and exacting as a loan. Why the interest on 10K CC loan is say 17% Apr and the same unsecured loan elsewhere as 8%?? It cast doubt on the CC's suitabilty for long term lending which many people have used it for.Its an expensive loan like a bridging loan
However,I would speak for the CC if one intends to build credit score rating. If so then YES, a creditcard is 100% necessary.Probably the most instant way to built ones credit. Spent 4K today and pay it pay back in 56 days...then again and again.I can't think of a more instant and effective way to built credit over a short time.
It all boils down what you want the CC for. Even 10K credit limit can be justified.
CC card companies make a lot of money outstanding....it makes sense for the lenders but not the borrower. With Debit card.....have anyone heard of a debitcard debt???
By all means have both visa debit and visa credit card. But the CC is evil because 'IT WANTS TO BE SHORT and LONG TERM CREDIT LOAN FACILITY' I never understood why credit card 'engineers/issuers' would want a long term credit outstanding for 10 years as with the 340K CC junkie I posted previously - lest to make money out of debt like PPI and bank charges etc. Simply, make the CC a short term lending facility as in the 56 days free interest window.
As for the purchase protection which makes the CC KING,but did anyone know that most prepaid card with the Mastercard logo will NOT offer that facility but the CASHPLUS card does? The inference to be drawn is that it suggest that if visa wants to give the same purchase protection for Debitcards as in CC it can but instead it wants the CC to be USED MORE TO RAKE IN MUCH HIGHER CHARGES AND ALLOW BANKS TO MAKE PROFITS OUT OF CC DEBT. In the current cash strap climate such business models are easily dismissed.
With the level of UK personal debt now and governement borrowing people cannot afford any more CC debt interest charges and as DAVID MOND says - "temptation" to indulge is a risk and is a clear and present danger. CC spending addiction is no different to drugs and gambling addictions.We've all gone through cold turkey.....thats learning the hard way,5 YEARS, and not to get into CC debt in the first place is learning in the most noble
Last edited by timeforchange on Thu Mar 19, 2009 12:35 pm, edited 1 time in total.
Hi,timeforchange.
Mmm....your's is a long long post on plastic. You might want to write in a column or set up blog site of you own?
But I get what you are saying - why create plastic to allow someone to keep a debt on it for as long as one lives.Its obvious when a debt cannot be paid off,and if I lent a friend 10K and he saids I pay ypu back in 5 years I will probably say 'No' especially if I am not charging him interest. Only in a family setting when I would lend indefinately.
Those plastic credit cards need have a free interest period as they do - but there must be a fixed period to pay it back.That's just common sense. Even a normal loan has to be paid back over time and you can't just TOP IT UP.
Credit card plastic are scum by this reckoning.Right on! The fact that so much money is made on 'plastic' through interest charges and late charges vindicates the charge - CC plastic is dirt.Only a payday loan is worse buit even those are noe regulated by Credit Agreements.
If you have a revolving credit loan, then you can top it up - constantly.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
That's the idea, but it never works out like that - I remember having a revolving loan years ago and only managed to pay it off by getting a consolidation loan!
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
