Keep away from credit at your peril

Several consumers looking to establish a credit history are denied credit because they don’t have enough credit to start with. And even a person with a high FICO score can be denied if the overall credit history bears too few records of active credit. Source for this article – Understanding the down side of avoiding credit by MoneyBlogNewz.

Being too responsible can hurt too

Everyone who is super responsible with credit might not do as well off as they think. Eventually, most people will conserve money by living generally debt free including paying off student loans right away and staying away from credit that is more than necessary. Some credit corporations don't like this though. There are some people that use credit, but have many choices to choose from. It can look bad to have credit inquiries too often though.

Experian's public education director Rod Griffin explained that credit can go down when there isn't much of a credit history and if you apply for charge cards often. Showing an ability to handle a reasonable number of open, active credit sources over time is paramount in illustrating credit-worthiness to creditors, including mortgage lenders.

Always have credit, however pay off loans

The argument Griffin has is that it is not bad to pay off loans early. This is despite what credit experts say. Negative marks will stay on a FICO report for about seven years while good things stay for about 10 years. Customers get put in the "no, thank you" zone by many creditors when they pay off loans very easily. You should have accounts open and active for at least 24 months for creditors. Otherwise, loan companies are likely to pass over the application and move on.

Use credit cards, but sparingly

Don't take on lots of credit cards in case you are a college student that is just beginning to build credit. Used responsibly and in moderation, having one credit card or two is a fine path toward building credit.

Griffin reports that this might change though. The Obama administration started the Charge card Act though. Several think that this makes it harder for young people to build credit. Experts say there is less of a possibility that students can build credit since access to college students is taken away.

Credit might be hurt more than you think when using just money

While you won't rack up revolving debt by living a cash-only lifestyle, you also will not build your credit. Maintain active credit accounts where you pay more than the minimum each month, and look to such goods as installment loans and no credit check loans when emergency funding is necessary. You can avoid building up too much debt on a credit card with these goods even though they will not make a difference on a credit history without reporting.

Citations

MSN

money.msn.com/credit-rating/raise-your-credit-score-to-740-weston.aspx

Yahoo

finance.yahoo.com/banking-budgeting/article/112152/dangers-of-avoiding-credit?mod=series-m-article-c

Understanding the Credit card Act

youtube.com/watch?v=UbIDOZz6CPw