Category: Finance, Credit.
".My wife and I purchased our FICO credit scores the other day. Why?
I was shocked to discover her credit scores were a lot higher than mine! I make more money than she does, and almost all the credit is in my name. " I hear this all the time. I must admit, I felt the same way when my wife s FICO credit scores were higher than mine. It s almost as if husbands are competing against their wives to see who has the better FICO scores. About two years ago I was shopping for a new car. I Thought I Was Prepared.
After I decided on the make and model, I submitted a credit application to the lender. I had checked all three of my FICO credit scores about three months prior to car shopping. My assumptions were wrong. At the time, all three were over 70I also knew the auto lender s tier schedule gave the best interest rate to people with scores over 70Needless to say, I was confident I would be approved for the lowest interest rate and best terms. I was approved. but, not at the, to my surprise best interest rate they offered. Which means I was not offered the best. or the next best. but the third best interest rate. (Yuck! ) This was painful for me.
They approved me in their third tier. I m always in the top tier. As it turns out, my scores were lower than I thought. What gives? The balances on my credit cards that month were higher than normal( I should have checked my scores a few days or a few weeks before I filled out the application. not three months before) . To get their best interest rate I now needed a 740+ score. (Yikes! ) My scores were around 680 at the time. In addition, the lender recently changed their tier schedule.
Guess I shouldn t have assumed. Fortunately, I had financed two cars with the same lender in the past, and each had a perfect payment history. I did catch one lucky break, though. So, as a courtesy, the car dealer convinced the lender to bump me into the second tier. The difference in the interest rate between the two tiers was less than 2% .but I just couldn t bear to be" second best. " So I said, "No. " Sometimes You Need to Walk Away from a Deal. But it was still only second best.
I really wanted this car. I already envisioned myself in it, flying down the road, my gray locks flowing in the wind. It was a convertible. Saying, "No, " really hurt. It s better to walk away than get saddled with a bad deal that will last years. However, one of the most important things I learned when we were recovering from bankruptcy was the ability to not compromise and the willingness to say, "No" .even when it hurts.
Our attitude has always been that if the deal doesn t make sense- there will be a better one waiting for us down the road. How a Husband and Wife can Work Together to Get a Lower Car Payment. So I went to plan B. I talked with Michele, my wife of 14 years, and asked when she last checked her credit scores. So we went quickly purchased her three FICO credit scores from myFICO. com/ 1 All three of her scores were MUCH HIGHER than mine. She hadn t checked them for several months.
How embarrassing is that? It s fine that her credit scores were higher than mine. Now ladies, don t take that the wrong way. But, I m the credit scoring expert! K. , I sulked a little) , I asked myself a question, "How can we use this to our advantage? " I am Woman, Hear Me Roar. So, instead of sulking over it( O. We took action.
We quickly filled out a credit application in her name and I faxed it to the lender. Michele was elected to become the borrower for my new car. As expected, they approved it right away. at the lowest interest rate and best terms they offered. My new car, but financed in my wife s name. Imagine that. I can see it now.
At first, it was a little tough to let my wife finance MY car, but I had to" build a bridge and get over it. " You can t let pride get in the way of your goals. I m getting a speeding ticket and have to explain to the police officer it s my wife s car. embarrassing. You have to take every advantage you get if you want to accomplish what you want. We use whoever has the highest FICO credit score( s) at the time. This is a strategy we ve used for years. We saved several hundred dollars a month by putting the car in Michele s name. If you ve just been discharged from bankruptcy, or are trying to build your credit, this may not be the best strategy for you to use.
When NOT to Use this Strategy. Why not? That s how we rebuild our credit. Because, for people with bad credit, we need as much good credit on our reports as we can get. It s fine that we got the loan in Michele s name, but the problem is that this loan never showed up on MY credit reports. Fortunately, I had already built up my credit, so it was no big deal that the loan wasn t showing on my credit reports.
So, I never got any benefit for paying it on time. However, your situation may be different. When My Credit Scores Went Up- I Put the Loan in My Name. If your scores are really low, and you need to build credit, you re probably better off waiting until you can apply for the loan in your name. So, now that a few years have passed, I decided to convert the auto loan into a lease and keep the car for another three years. And my scores were back to normal. This time I had current information before I filled out the application.
In fact, my scores were higher than Michele s scores( this makes me a happy credit scoring expert) . So the car is back in my name- I guess now I can start speeding again!
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