WHY WE GOT A CREDIT CARD AFTER BEING DEBT FREE FOR 5 YEARS (Dave Ramsey & Credit Cards)

We cancelled our credit cards after going to a Dave Ramsey total money makeover live event. We didn't use credit cards for the next 8 years.

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Cutting up our credit card and cancelling the account wasn’t difficult. It was just as easy to use a debit card to purchase things we needed as it was to use a credit card. And that’s what we did for 8 years.

Our credit scores slowly declined, going from 800+ down to 775, to 749; dropping ever so slightly every month until they just weren’t available anymore. If someone tried to pull our credit, it showed up as empty.
We were perfectly content with this situation for 5 years. We thought, “we’re debt free – there’s absolutely no reason we need a credit card or a credit score for anything.” Until we came into a situation where we realized having a credit score would make our life A LOT easier. We were buying a house.

For the longest time, Brittany and I thought we could do what’s called MANUAL UNDERWRITING when purchasing our first home. We shopped three different lenders. TWO could do manual underwriting. HOWEVER:
• We would need a lot more information and payment history. (Inconvenient but not too big of a deal.)
• The interest rate was slightly higher. (Again, not a huge deal but still annoying.)
• We would also need ONE YEAR’s worth of mortgage payments, in liquid cash, after closing. Meaning, on top of a down payment and closing costs, we would need one year’s worth of payments on top of that well in advance of closing. In our case, on year of mortgage payments was an extra $17,500.

If we had a credit score above 740, all of that would go away and we’d also be able to get the best rate. And that's what we ended up doing.

Our general rules with credit cards are as follows:
1. We NEVER spend more money on a CC than we were originally intending.
2. We NEVER spend money that we don’t have already in cash.
3. We NEVER carry a balance. We pay it as soon as we can. Usually two days later as soon as the charge has been processed.
4. We don’t use credit cards in an attempt to build wealth.
5. Probably most importantly. We don't spend money on things we wouldn't normally be buying if we didn't have a credit card.

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Видео WHY WE GOT A CREDIT CARD AFTER BEING DEBT FREE FOR 5 YEARS (Dave Ramsey & Credit Cards) канала Mike and Brit