credit limit versus no pre set spending limit credit card

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This topic contains 3 replies, has 2 voices, and was last updated by  Anonymous 8 years, 1 month ago.

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  • #209413

    Anonymous

    I’m posting this in case it helps someone else figure out their credit report.

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    My husband and I are buying a house. We obtained our free credit reports and I saw that his reports seemed to be clean. So we didn’t buy his FICO scores.

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    We got pre-approved for a mortgage and the loan officer sent us a copy of the credit report they pulled for him with the FICO scores from the 3 agencies. His scores are high, but I was puzzled because each agency listed “no recent revolving balances” as a factor for his score (I assume a negative factor). It was puzzling because we use a credit card for almost all our purchases, the Chase Amazon.com Visa.

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    This account is listed on the free credit reports as a credit card, and only on closer inspection did I see that no credit limit is listed. On the credit report from the lender, the Chase card has listed under “MOP” (method of payment) the term “O-1.” I googled this and found out it means “open line of credit” also known as a NPSL (no pre-set spending limit) card. On the lender credit report, the amount we charge on this card is listed as “other” under account type and not under “revolving.” So he had $0 considered for a revolving account balance. I’m thinking this put his utilization ratio at 0%.

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    Maybe if we had bought his FICO score from this site, we could have used the score simulator to figure this out, but because his free report looked pristine, we didn’t bother. I probably would have made sure to charge at least a small amount on one of our other credit cards, one that actually is reported as a revolving account with a credit limit, prior to applying for the mortgage.

  • #442704

    Anonymous

    Call you home insurance company and ask them what you can do.

  • #442705

    Anonymous

    House insurance is insurance to cover your house, if it burns down or such.

    YOU are talking about LIFE insurance, either a decreasing term insurance policy, or straight term. It’s going to be rated based on how old you are, what your health is like, how much the mortgage is, and how many years you have left.

    Ever thought about consulting an estate attorney, and putting the house in trust? Then letting the life insurance policy fund the trust, to pay property taxes, insurance, food, and utilities, after you pass away? That provides housing to him, without giving him any income.

  • #442706

    Anonymous

    What you are asking about is not house insurance; it is mortgage protection life insurance. You are not insuring your house. You are insuring your life for the value of your mortgage. The beauty of mortgage protection life insurance is that it cannot be used for anything other than paying off your mortgage. Traditional life insurance can be used for that too, but your grieving son could be tempted (or deceived) into spending it on bad investments. The death benefit could be lost and there would be no way to pay for the house. So your idea is a good one.

    The best way to find a policy that is right for you is to contact an independent life insurance broker. A broker works with several life insurance companies and can find the best coverage at the best price for you. Since the broker wants to stay in business and gain referrals, he or she will point you only to reputable companies.

    To find a good life insurance broker, log on to a site like and complete the “request a quote” form. The form will go to a broker in your area who will contact you. The quote is free, and you are not obligated to buy. Good luck!

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