FICO

I caught some of Dave Ramsey's show yesterday. He's big on having no debt except a mortgage.

He fielded a call from someone who was >3 years beyond a bankruptcy. She wanted to know how to get a better FICO score so she could purchase a house.

After Dave gave her some help, he went on about FICO scores after a break. It seems he thinks the goal should be to have no FICO score.

To increase a FICO score, one has to "play" the debt game. Play and pay and watch the digits increase.

However, if your home is paid for and you carry no debt including car and credit card loans, you don't have a FICO score. If there's a no score on you, most mortgage companies and banks (nearly 90%) will not consider loaning $ to you.

This doesn't make much sense. If you owe no one, you will have trouble getting a loan. However, if you have debt and are paying debt, your score will be high enough to get more debt.

'til later