Dude are you for real? Have you ever borrowed money on anything in your whole life? No where on any loan contract does it say that the balance can be requested at any time. Unless you have been borrowing money from guys named Paulie. A contract is a contract, you pay back at the contract terms. And furthermore, if you owe $5000 on a car loan, it's going to cost the bank 3 times in legal fees to sue you. Not that I should even address that fact, because it's predictated on theory that is absurd to begin with. Have you ever noticed that there are two times of mortgages and car loans out there; fixed and adjustable? Do you understand what the difference is. When you get a fixed mortgage, that interest rate is FIXED by CONTRACT.
I'm 30 years old, own my own home, own 3 cars, have an 800 beacon score, and only have school debt and my mortgage to worry about. And I'm done it on a very modest income, so obviously I've figured out the system, and how to build credit.
If you don't think this is the best way to do it, go talk to a financial advisor and tell him how you would rather pay rent the rest of your life to be more financially responsible instead of buying a house. He will laugh at you, I promise.
Kurt
Blackvert said-
"being OK with carrying debt around, and thinking that it is normal or good is just plain stupid. if you want to give your hard earned money to the car company and the bank every month for the rest of your life, then go right ahead. it's your money, throw it away if you want. i hope you like dog food, because when you are 75 and still have mortgage payments to make, that is about all you will be able to afford.
and the whole "i am better off having a mortgage for the rest of my life because of the tax write off" is a fallacy, and the big, multi-billion dollar banks are very happy to keep it going. where do you think they get their money? if you don't understand the fallacy, then i'll be happy to provide a detailed explanation with examples if you want.
people who are smart with their money don't finance or lease cars, they carry no credit card debt, they live below their means, they have a few thousand saved for emergencies, and they pay off their school loans and mortgages as soon as possible. then they put their money into long term investments and before long, they are millionaires"
Guys. Read this again! 'vert, you're absolutely correct!
People who are rich (Not the ones that Drive an expensive car and live in an expensive house.) do NOT use credit cards to "finance" their lives!
For your information "revhead", I own two houses and people pay ME rent. (I've NEVER had a finacial advisor laugh at me. You have?) I have three cars, all paid for. (Only 1 is a "late model"...1999 Jeep Cherokee. The other two are 85 and 86 Merkur XR4ti's...my "weakness".
I DD one of the Merks, in the Summer. The Jeep is for Winter.) No credit cards. I make about $30k a year. I'm 40 and have seen credit being the absolute RUIN of people. (Almost myself included.)
I guarantee, "good" credit WILL bite you sooner or later. That super awesome credit score will VANISH, as soon as you miss a payment or two. Good for you, if you think you've got it. I choose to not have a "lender" (who will become adversarial, with one missed payment) in my financial affairs. Do it how you want to. I'm just saying I've learned not to trust CC companies.
And, by the way, contrary to your response, I never said that you should pay rent for the rest of your life. (Those were words YOU added.) Just maybe 2-3 years until you can save up 20% down for a house that fits your needs. I dare you to find a FA that would laugh at that.