New England B.S. Thread

Ive just very recently been doing real estate and car transactions, so I've been brushing up on this stuff, I also had a long talk with my bank about scenarios and where we sit and what will make our terms change

I've read stuff that the way they determine credit is going to change but i dont know a ton on that. Seems like something @GarlicFarts or @MikeyMcFly would know more about

 

I don't know how I've gotten that reputation but I can give it a whack

Okay - I had no idea of these changes but after a quick goog it makes sense.

https://www.kiplinger.com/article/credit/t017-c000-s002-changes-are-coming-to-your-credit-score.html

So - the current system. A portion of your credit score is utilization. Let's say you have a 10K credit line. You use every month 1K, that's a 10% credit utilization, that's fine. The way these are reported is your monthly statement, so every month you get your statement AND capital one tells, let's use Experian, that you owe them 1k but your credit limit is 10k. Cool beans.

Now. That's your usual bills. Groceries, dining, mountain bike parts, truck sliders, etc gets you to 1K a month on a regular basis. Well, February comes around and you and the fam go to Phoenix for a break from the cold (funny story, I was there in March, and I was in shorts and a T shirt and the locals were ACTUALLY in jackets, puffy jackets, at 75°F.....). This is a non-normal expense and you put it alllll on the card (I recommend amex for travel). So now you wait for the bill, Capital One says "You owe us 5K this month", they tell Experian "He owes us 5K this month", and now you're at 50% utilization.

SO. You go to a 50% utilization - which hits your credit score. However. Next month. March. You go back to normal, and Capital One says "He owes us 1k, credit limit 10k" and your credit goes right back to the same numbers in March.

Long of the short - your utilization has no history. Only the current billing cycle (so it does take a month to "reset"). Buying a house, car, etc they only see your credit card usage back a month or two. What it SOUNDS LIKE the changes are - they see that % change over time, so they'll see 24 months of that history, so if you go on vacation in February 2022, that spike up in utilization will be seen until Feb/Mar (whatever) 2024.

So - that said, there are three "main" things that "most" people use their credit for.

1 - Credit cards, the companies will use a computer program yadda yadda and auto select approve/deny. These are easy - just go for pre approval before you apply.

2 - Cars. These are somewhere in between, they use computers but ultimately you have someone looking at it and they'll see "Oh it was just a vacation back in whatever, no big deal".

3 - Houses. Same as 2, but even more human involvement.



Realistically they won't care about a spike here and there. That's factored in as normal noise. They'll care about a trend upward over the past 24 months if it's significant (IE 2% gain every month for 2 years), or if it's staying level but high (IE 50% for 2 years).


I'm assuming. That's all new to me and I have no idea.




















Good morning.....

 

This response is why you got that reputation! At least with me. You’re a straight nerd with numbers and I mean that in a good way, something I admire but can never get into fully.

If you pay your cards off on time every month does utilization matter? Or does it depend on when they report?

 

Sounds right to me!

Slightly off topic of a car/home loan, but along the lines of credit card utilization there's a common misconception that you should carry a balance from month to month to get the best score. This is incorrect. The bureaus only receive a statement balance and whether or not a payment was made when due for the last statement, so they don't actually have a way to determine if you paid in full or not.

The best thing is to always pay in full to not accrue interest. The only exception if you have a 0% deal on a card that you were taking advantage of for a larger purchase.

I wouldn't worry about a car purchase two years before buying a house. As long as you don't end up with an absurd monthly payment that eats up a big percentage of your income, it'll actually probably help more than hurt. What you don't want to do, as @Bridge4 said, is open a line of credit while you're waiting for the house deal to close. I had a friend almost lose a mortgage due to a Home Depot card he opened a couple weeks before closing to get some money off appliances for the house.

 

Yea thats true. I'm really only willing to go up another $100 a month from what I pay now. Which would put the payment at $550 a month.

Ah well i didn't know at the time the bed was rotting. I was gonna do my monstaliner on saturday and found it

 

I have a degree in engineering and a degree in statistics. It happens ....

It does not matter - ISH.

So, breaking it down:

Current state: No, it doesn't matter, UNLESS you're at a high utilization for that month, AND now you need to go get a car after some nimrod blows a red and totals yours. Now, that credit pull will see the high utilization for that month, instead of your normal low utilization.

Home loans take >2 months usually from soup to nuts, so a high month here or there wouldn't be a problem.

Future state: It will see the past 24 months, so if you're high THIS month, not a big deal. However it might spike some eyes to look in deeper, if your utilization spikes AND you're looking for a car loan.

The short of it: Always pay your Statement Balance by the Statement balance due date and you're good to go. As you were saying, there are 0% intro cards, which could make sense (IE Your buddy could have used one of those instead, and used it essentially as a 0% loan for 12-18-24 months however long the zero percent is, we did that when we bought the house). However those, be aware of the language - typically even though it's 0% APR, you still must pay the minimum amount due each billing cycle. If you do not, then the 0% APR ends then and there.

Yes - from the minute you decide "I want to buy a house", DO NOT do anything other than your mortgage. Your bank accounts, credit cards, just let it sit. Pay them off, wait. You want a zero percent card, or an HD card? Bro, those take like 4 days to sort out - wait until you get the damn keys. Don't mess with your loan clear-to-close

If you go on ANY of the finance subreddits, they talk about how "oh my god your payment doesn't matter YOU NEED TO LOOK AT THE WHOLE PICTURE111!1!!!11!".

Yeah some of us budget monthly and both matter I DO miss having my Mazda though. Man - that thing, even got the nice one with leather seats, sunroof, everything like that, and it was so dirt cheap. Trucks are expensive

 

@tacobell007 time to sell it dude and get yourself into a Dodge Ram with moose ears and 22" rubber band strips.

 

Yep, my mother just had the same thing. They were in the process of closing on their condo and bought a car during the move. It almost cost them the condo! The underwriters really, really don't like that kind of thing.

 

Well that sucks, hopefully he has something that will work for you. How thick are we talking?

 

I won't lie - if I wanted an HD gasser right now, I'd be in a power wagon any day of the week. Full size probably an F150 but could be convinced of the dodge, potentially. Depends how the next Tundras look too.

but I'm not looking I promise.

 

HD Gassers are in a great place right now, lots of awesome options out there. The Dodge is now the most outdated, still rocking their 6.4 w/ MDS. The GM 6.6 gasser seems to be a really strong power plant if you can get over the truck's looks. Ford's 7.3 is a beast and where I'd go if I needed a gasser but they also put the 10 speed transmission behind their 6.2 which I can see being a huge improvement (although you have to jump to the 350 to get it, the 250 still gets the 6 speed for some reason).
If you're sniffing around the Power Wagon though, you'd have to give the Tremor a hard look. I'm bias though, I'm a fan of the current Super Duty body style (clearly) and that 7.3 is a hell of an engine (and you can get the Tremor in the diesel flavor with a winch, something Ram never did for the Power Wagon).

 

Yea, I know people like that too. My payment is like $360 currently, but I pay $450 a month on it just to knock it down that much quicker.

Might have to swap out my earrings for diamond studs as well if I did that, just to pull the whole look off

We shall see. I'm going to look at a couple trucks tonight. The used Tundra market is absolutely obscene with prices. I might as well buy a new truck for the cost of used right now

 

Nah, you just need a Monster flat billed hat, a Hoonigan sticker in the rear window and you're good to go.

 

Does anyone know of anyplace I can camp near Northampton, MA in November? Doing some research now, seems like there are no 4 season primitive camping forests in CT or MA.

 

I hardly have a use for the Tacoma other than camping/wheeling, no way I'd get an HD. Wouldn't be worth it, in cost or gas or insurance or taxes at all. Hell, even the Tacoma is toeing that line

Yeah - right now I think there's really no "bad" truck decisions, some might not fit each specific need (IE me, no need for an HD so it makes no sense) but, if it's the right fit I don't think there's any bad decisions to be made.

What is this paying early nonsense!?

We refinanced our mortgage, we are not underwater and it's 2.625%. Cars you want to be more aggressive since they're depreciating and you are almost certainly underwater. But for my house - that's free money. Any "extra" is going into investments, not the mortgage early. No way.

Big oof. When in November, and what is the intention here? Just a quick overnight or wanting to go out and camp? I might know some spots close in Southern VT about 90 minutes north but I don't know when they close for the season. I know a spot that is probably open but is way further north in VT - woodstock area.

 

Quick overnight for some local wheeling then pushing north to VT.

 

tenting? rooftop tent? camper? I live about 20 minutes away.

 

OFR might be gated off. @tacobell007 is near there I think? If that's your plan - OFR - might be gated.

I can send you some spots in VT to check out for overnights if you aren't already sorted. But not sure about anything in that area in MA.

 

@cynicalrider https://koa.com/campgrounds/northampton/