MBNA Credit Cards

[I-Hate-Hulse]

nm

[Deegee]

Originally Posted by evilcougar

also, tid bit on car loans....if you can not afford your car anymore, and you give it back to the creditor, they can still report it as a reposession...its considered a voluntary reposession.

And depending on the institution the remaining balance on the car loan will be assigned to collections. So not only will that trade report poorly, but you will also have a public record filed. Yay.

[REDVAN]

Originally Posted by evilcougar

to many ppl to quote here, so, i'll just tell you the top 10 things of what i know about the credit industry since i've been working in it for almost 9 years now.

1) it's not a good thing to have to many cc's. you should never be more than 75% utillized on any card at any time. being at max or over max severely hinders your credit scores b/c it shows you are 100% utilized.

2)no one needs more than one major credit card. most ppl do tho. just make sure you don't get out of control with them. just b/c you have a card at a store with a limit doesn't mean you have free money to go shopping. this is how ppl get themselves into trouble and then can not qualify for mtg's to buy their first house.

etc.

Sorry to be a ######, but that post was hard to read...



edit: however, thanks for the good info. Just don't want you thinking I didn't appreciate it, I just had trouble reading it. Do you type on a Blackberry?

[evilcougar]

Originally Posted by REDVAN

Sorry to be a ######, but that post was hard to read...

you're not being a ######, but, are you saying short form words are hard to read?
i can understand the annoyance of not using capitals, unfortunately its a work habit. in our system when typing notes in someones account, its always in caps, so, i never have to push the shift button. and after typing stories upon stories about ppl and what their issues are for 9 yrs, habits are obtained.
pls forgive my habits.

[evilcougar]

and yes i type on blackberry

[ernie]

Not to be a dick but the easiest way to have a low interest rate really is to simply not pay interest. Clear the balance on the credit card every month. If you can't, then you are spending too much money. Other than our mortgage or rent, my wife and I have lived debt free for 15 years. In that time, we have never carried over a monthly credit card balance to the next month. We've never paid interest on anything but our mortgage.

Yeah it sucks the first few years because you really really want a new(er) car and you see your friends with new cars, furniture, electronics etc, but we are really starting to see the rewards of our frugal spending earlier in our marriage. We are far better off than friends who make comparable money because we didn't finance all those things or only pay off a portion of the cards every month when we were younger.

[evilcougar]

Originally Posted by ernie

Not to be a dick but the easiest way to have a low ineterest rate really is to simply not pay interest. Clear the balance on the credit card every month. If you can't, then you are spending too much money. Other than our mortgage or rent, my wife and I have lived debt free for 15 years. IN that time, we have never carried over a monthly credit card balance to the next month. We've never paid interest on anything but our mortgage.

Yeah it sucks the first few years because you really really want a new(er) car and you see your friends with new cars, furniture, electronics etc, but we are really starting to see the rewards of our frugal spending earlier in our marriage. We are far better off than friends who make comparable money because we didn't finance all those things or only pay off a portion of the cards every month when we were younger.

first, why would anyone think you're being a dick? you are absolutley right! however 90% of the population do not live this way....hence credit issues....hence my post.

[Dan02]

Originally Posted by evilcougar

first, why would anyone think you're being a dick? you are absolutley right! however 90% of the population do not live this way....hence credit issues....hence my post.

I would disagree with him being absolutely right, yes most consumer debt is unneccessary, however, there are plenty of reasons to have debt and i would suggest if you weren't born into money and have never carried debt in your life then you've probably lived a pretty drab risk free life. I wouldn't call him a dick, more narrow minded then anything.

Sometimes you need to borrow money to make money.

[MoneyGuy]

I'm a financial planner and am always shocked at how much debt younger folks carry (expecially on credit cards) and how they arrange their financial priorities. I'm older than just about anyone on this site and I wasn't like that when I was in my 20s or 30s. People just make very poor financial decisions. In fact, I saw an article in the paper this morning about the hundreds of bankruptcies in Alberta in JUST ONE MONTH!!! Wow! If anyone here is in this situation, take corrective action and do it right away. It's key. I do a newspaper financial column and I'm actually working on one right now on this very topic. If people don't fix this in their 20s or 30s it can seriously hamper you for a lifetime. This is slightly off topic but I think it's important.

[dobbles]

Originally Posted by ernie

Not to be a dick but the easiest way to have a low interest rate really is to simply not pay interest. Clear the balance on the credit card every month. If you can't, then you are spending too much money. Other than our mortgage or rent, my wife and I have lived debt free for 15 years. In that time, we have never carried over a monthly credit card balance to the next month. We've never paid interest on anything but our mortgage.

Yeah it sucks the first few years because you really really want a new(er) car and you see your friends with new cars, furniture, electronics etc, but we are really starting to see the rewards of our frugal spending earlier in our marriage. We are far better off than friends who make comparable money because we didn't finance all those things or only pay off a portion of the cards every month when we were younger.

i find thats a pretty unrealistic scenario for most people. i myself have very little debt. something like $100 bucks on a discover card and about $5k in student loans still. but i still understand where credit cards can still be useful for responsible people. often times credit cards can be a good way to deal with an emergency. if for instance your furnace breaks in the middle of winter, its not realistic to wait a few months until you can save the money to purchase a new one outright.

[MoneyGuy]

Originally Posted by dobbles

i find thats a pretty unrealistic scenario for most people. i myself have very little debt. something like $100 bucks on a discover card and about $5k in student loans still. but i still understand where credit cards can still be useful for responsible people. often times credit cards can be a good way to deal with an emergency. if for instance your furnace breaks in the middle of winter, its not realistic to wait a few months until you can save the money to purchase a new one outright.

I don't think Ernie's being unrealistic at all. He was saying don't carry CC balances. Whatever you earn, spend less. It's not hard. This is achievable for almost everyone. People get themselves into financial difficulty, generally, because of poor choices, not because circumstances have conspired against them. I know this isn't what you're saying, but I think Ernie's correct. I've been in my business for many years now and I've seen it all.

Regarding your example of the furnace breaking down ----> emergency fund.

I firmly believe that almost everyone has the opportunity to protect themselves and their family, build a moat around their finances and build the future of their dreams, accumulating more money than they probably thought they could. The reason most people fall far short of their financial goals is poor decisions.

[Cowboy89]

Originally Posted by MoneyGuy

I'm a financial planner and am always shocked at how much debt younger folks carry (expecially on credit cards) and how they arrange their financial priorities. I'm older than just about anyone on this site and I wasn't like that when I was in my 20s or 30s. People just make very poor financial decisions. In fact, I saw an article in the paper this morning about the hundreds of bankruptcies in Alberta in JUST ONE MONTH!!! Wow! If anyone here is in this situation, take corrective action and do it right away. It's key. I do a newspaper financial column and I'm actually working on one right now on this very topic. If people don't fix this in their 20s or 30s it can seriously hamper you for a lifetime. This is slightly off topic but I think it's important.

I think the thing I notice about young people (I am one) is that once someone starts a full time job or career they automatically assume that they should be buying a house, driving a new car, owning all the toys etc, etc. It's almost an entitlement thing. I've seen friends go 5% down on 40 year mortgages, lease/finance brand new cars, and not practice any spending discipline when it comes to going out. They never intened to carry a balance on credit cards, but the overages of their excess spending turn into large balances. Up until the fall the solution to any cash crunch for these peoplen was simply more credit. No surprise that a lot of these people end up bankrupt when new credit goes dry.

[Cowboy89]

Originally Posted by fotze

fixed

I am just cynical because I think in 13 years of investing in RRSPs I could have made more money investing in lottery tickets.

You're just bitter you didn't heed MoneyGuy's advice on ploughing into Equities the past few months. I'm up 25% on pretty much everything I bought the past few months.

[macker]

In other news the US consumer savings rate is up around 5% now and heading towards 10%. The articles in the Globe etc. are actually over blown if you take a city the size of Lethbridge where there was something like 36 bankruptcies and you compare it to a similar sized city in the US we look pretty good. I guess it just gets people talking and makes for a splashy article that alarms people. I think our savings rates will also increase on par with the US.

[MoneyGuy]

Originally Posted by fotze

fixed

I am just cynical because I think in 13 years of investing in RRSPs I could have made more money investing in lottery tickets.

What can I say? We're in a 10-year period where the market has basically gone nowhere.

Tell you what: Avoid equities for the next 10 years and buy lottery tickets or GICs and report back to us in 10 years how that went for you, okay?

For those who have said that it's not just young people who make poor decisions and therefore are in bad financial shape, that's true. It's folks of all ages.

Reminds me of the cartoon I saw many years ago. There were two guys sitting at a desk. One was a financial planner and the other was a client or prospective client. The client says to the planner: "I retire next week. Here's your chance to make yourself a legend.)

[ernie]

Originally Posted by Dan02

I would disagree with him being absolutely right, yes most consumer debt is unneccessary, however, there are plenty of reasons to have debt and i would suggest if you weren't born into money and have never carried debt in your life then you've probably lived a pretty drab risk free life. I wouldn't call him a dick, more narrow minded then anything.

Sometimes you need to borrow money to make money.

I assure you I did not come from money. My parents were hard working and underpaid. They raised us and made sure we had a roof over our heads, food on the table and essentially anything we wanted/needed, but they never had the money to put us through college. That was done on the back my academic efforts and working fulltime from grade 9-12. Yes I saved a huge chunk of money to pay for my education....call me a nerd if you like but I call it the education my parents gave me on how to be better off than they were/are.

I also assure you that I have not led a drab existence but a rather fulfilling and exciting adult life. Because of the decisions we have made in the past we can continue to lead that life despite having more mouths to feed. That is something most people we know can't say because they tied themselves up into debt early on and are struggling to get out from underneath it.

We aren't talking about borrowing money to make money. We're talking about racking up debt on credit cards, car loans etc. None of that spending has anything to do with borrowing money to make money. They are money losing propositions from the get go.

Originally Posted by dobbles

i find thats a pretty unrealistic scenario for most people. i myself have very little debt. something like $100 bucks on a discover card and about $5k in student loans still. but i still understand where credit cards can still be useful for responsible people. often times credit cards can be a good way to deal with an emergency. if for instance your furnace breaks in the middle of winter, its not realistic to wait a few months until you can save the money to purchase a new one outright.

Credit cards are good for an emergency because you often can't liquidate fast enough or get enough cash right away to fix a problem. However, your scenario is covered by the savings you have. You may need to put it on a credit card to get the fix done right away but you have the money to cover it when the bill comes due because of your past savings. You save with those things in mind. You earmark money for house improvements, car purchase, unforeseen circumstances etc.

Believe me we use the hell out of our credit card (we get a percentage cash back...we actually make quite a bit of money off the card company!), but it always gets paid off. Always. Once you let it slip once, it's easier to let it slip a second time and then you are on a downward spiral.

I know that 90% of the world doesn't live that way and they are absolutely correct they don't. Perhaps they should. Perhaps if they did the mortgage crisis in the states never would have happened. There is a very small percentage of people that "need" to go into debt. There is a large percentage of people who simply don't give it a second thought and these are the people that lose their houses, cars etc when something bad happens. Our goals that i think we'll meet is to have the house paid off in another 2 or 3 years...or 8 years into home ownership (we didn't make much money on our first house and only came out ahead because the company paid the real estate expenses). At that point the only payments we will have are insurance and taxes. Some people think we're stupid because we have a reasonable mortgage rate and could be doing something else with that money. We believe that at that time if something happens we have a home and will not lose it. We will have cars and not lose them. We can continue to live our lives (a bit more frugally of course) until the next job comes around etc. There will be minimal impact on our lives unless the situation is dire and very long lasting.

[Slava]

Originally Posted by fotze

I wouldn't be so bitter if I was actually up prior to this latest collapse.

Diversification is a dirty word in my book, that's what killed me.

Seriously you need some new advice if you weren't up at all over the past 5 years. Diversity is good, but there are a few schools of thought on that to be honest.

[evilcougar]

Originally Posted by fotze

Odd thing is, that you live credit free and do all the right things and the a-holes who buy 5 houses and cadillac escalades that they cannot afford fata up your savings anyway. I think when a person's bad financial decisions affect people other than themself or the lender, it should move into the criminal realm.

They had on dateline the other night a woman who had a number of mortgages for houses that there was no way sho could ever afford, she said not one ounce of blame should be placed on herself. The underwriter who should have checked her income also said they had no blame. They should melt both of them down for any sort ofr precious metal they may have ingested over their life.

ohhhh you sound like me on a daily basis at work....i do NOT understand the lenders that keep lending to people when they CLEARLY can not afford it. i seriously took an application the other day for a guy that owed over 200k in revolving debt. (credit cards).
the other 500k was his house...which is on a 40 year mortgage. and of course he has no equity b/c he just bought the house. i have no clue how the HELL he and his wife got approved. and the worst part is, he's a financial planner and she works for RBC.

[Kavvy]

Just to give this thread a bump, I have a couple questions I was wondering if anyone would mind answering:

I was looking at the credit card shown at the link below, but never have heard of MNBA before. My quick research shows they are an affiliate of Bank of America, but they are unknown to me. I called them to answer some questions, and the agent seemed clueless. This thread has many old posts stating how good they are, can anyone reassure me that they are not some shady credit lender who won't pay me my cash back and hurt my credit rating?

I will be applying for a mortgage in the coming months, and I already have a credit card with RBC, but I don't like it. The rewards come to slow and I would prefer a cash back card. Since RBC is tied to my bank account, I see no reason to cancel it, would it be foolish to have a second credit card a few month prior to getting a mortgage?

http://www.mbna.ca/smartcash_cardlist.html

Thank you for any advice!

[Cecil Terwilliger]

MBNA is reputable. You should have no worries about them.

Getting a second credit card won't effect your credit score. You only have to worry about having a ton of hits.