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Old 11-30-2007, 10:53 AM
spex x spex x is offline
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Join Date: Jun 2005
Location: who dares wins
Posts: 569
Default Re: How to build credit

2) Can someone explain to me more how your credit score and income are related to put together the amount of CCs you can get?

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I'm curious about this as well. I have never had legitimate credit so I'm having issues with the claims that individuals can get 4 and 5 times their income in credit.

My general view of society is that they are irresponsible. If it was this easy to get credit I'd expect a lot of people to be living temporary baller lifestyles on credit.

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My friend who got started investing using CC credit got about $200k of available credit. I'm not sure what he was making at the time, but he was a foreclosure door knocker for a mortgage company, so it couldn't have been that much.

He had been a loan officer b/f that and had access to some people at several different banks to consult about the best ways to secure high credit lines with a relatively low income.

My understanding is that he applied for many cards all at once. He then more or less maxed out each card by taking advantage of 0% balance transfers. He put the money into an account and made payments for 3 months. On the fourth month he paid all cards off. The then called the companies and asked for a line increase, and repeated.

Apparently the banks want to see that you can handle the debt load more so than they care about your actual income. If you prove you can handle $10k, they'll take a chance on giving you $15k. Over time he built up enough credit at low enough interest rates that he was able to utilize the credit for investment purposes.

I dunno. It worked for him. I don't see it as any different than taking out any other type of loan for a leveraged investment.
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