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A FICO Score ranges from 300 to 850, with anything from 670 to 739 being considered good.
With good credit comes the ability to get different types of financing products, likemortgage loansor rewards credit cards.
The better your credit is, the more likely you are to get better rates and terms as well.
But what about if you dont have credit at all?
According toDave Ramseyand other financial experts, its entirely possible to live without a credit score.
In some cases, it might even be better.
In others, it can make your life significantly more complicated.
Also here are eight steps to building (or rebuilding) credit.
Does it make some purchases or financial transactions more difficult?
Yes, said Burkett.
Dave Ramseys [belief] that you might buy things without a credit score is very true.
Do most Americans do this daily?
And this typically requires a credit check, which also involves pulling your credit score.
If your score is low or nonexistent, you might not qualify for financing.
But if youre paying in cash, you dont need to worry about getting approved.
Burkett saidsome mortgage companiesdo offer manual underwriting also called no credit score or nontraditional credit lending.
This could help someone without a credit score qualify for a mortgage.
But theres no guarantee that your financial institution will have this option.
The lower your DTI ratio is, the better your approval odds.
According to Experian, the average American consumer owes $104,215 across different types ofloans and credit cards.
This is difficult to do and a mindset change to make.
Advice From a Certified Financial Planner
So, what are your options if you have no credit?
Have a list of wants or needs that are coming in the next year, five years and future.
Put dollar amounts to those goals and [the] dates you want to accomplish goals, Burkett explained.
Funny enough, that is theaverage car paymentI see right now.
No Credit Is Better Than Poor Credit
No credit score is better than having a poor one.
Mena had a few additional tips for living without credit.
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