On Fri, Jan 7, 2011 at 10:31 AM, G Money <[email protected]> wrote:
> On Fri, Jan 7, 2011 at 9:22 AM, Cameron Childress <[email protected]>wrote:
> > Suddenly taking on a large amount of new debt is not a huge red flag?
> > I'd certainly say it is.
>
> No, because "huge" is relative, isn't it?

Sure.  Relative to your other debts.  Which is why they generally want
you to keep your balances around 35% of total available credit.  Go
above 35% and you get dinged.  Go substantially over and you get
dinged more.

> If my entire credit history shows me paying off debt of a similar size in a
> timely manner, why suspect anything different in this case? Does my spotless
> credit history buy me NO benefit of the doubt on current debt?

As you said, it's all relative.  Established debts are guaranteed to
stick around (unless you bankrupt).  Established income levels are
not.

> The answer of course, is no.  I just think that's stupid.

Frustrating sometimes yes, but not stupid.  The housing bubble /
foreclosures very clearly show that there is MASSIVE risk to giving
credit too easily, even to people who have a good record of paying
thing on time.

-Cameron

..

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