Hunting The Muse

House News

Those of you following along know that I am buying a house. We've just been in dotting i's and crossing t's mode lately. Pre-approved, done with home inspection, done with appraisal, underwriting agreed that the house was worth the loan - we were just getting ready to sign the papers.

Today, my loan got declined.

Three years ago I had a fair amount of debt. I came out of college in '95 with student loans, several thousand in credit card debt, and a car loan. I had a job in California and had moved out of state to telecommute in an effort to have lower living expenses and get ahead with my money. After a few years, I was finally getting over the hump. I remember when I finally paid off the last of my debt, and then I was surprised at how relatively easy everything felt afterward, due to interest working for you instead of against you.

I basically let my credit cards rot because I was so sick of the games they play - charging you finance if you're late by a couple of days, charging you finance even if you pay your credit card in full, because of the interest that builds up while your check is in transit. My cards were paid off, my loans were paid off, and I owned my truck. I liked it that way.

For the last two years I have lived off of my debit card, with the exception of when I bought my laptop - I paid that off the next month.

My credit ratings have consistently been above 800, which is close to maximum. But on the final spot-check for the loan, they ran my credit again, and two of the reports came back blank. They were blank because I hadn't had much recent credit activity. So, my loan got declined.

In other words, this bank is not allowing me to buy a house, because I am too good with my money.

They're setting me up with another loan with higher interest rates that I can't refinance for three years. That's an extra $120/month. I guess I am high-risk because I pay off my debts. What a fucking stupid system.

Posted by Curt at August 25, 2004 05:45 PM