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Moving out of parents' house using credit card a bad idea?


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MisUnderstood1

I'm itching to move out of my parents' house. I had the opportunity to do that earlier this year when I had some money on me, enough to last for up to 5 months, but I stupidly allowed them to talk me into remaining at home, thinking I would be able to find a job and save money, which hasn't happened. All that money is gone now (long story) and I no longer have much. I am going back to school in September to do a post-grad program that would enable me to get a good job once I finish. I will be getting student loans and they're giving me a generous amount.

 

I got a credit card from my bank late last November and have been doing well with it, always paying on time. Recently, they increased my credit limit to $4,000, from $2,000. I didn't ask, they just sent me a letter saying they were pleased to increase my limit for being a good customer. If I move out now, I would have no other choice than to use my credit for cash adv to pay rent, that would be about $1000, as I'm looking to pay no more than $500 for rent. I do know that cash advs aren't good. I cannot find a job in this small city. The city I'm planning to move to is where I will be doing my program; it's bigger, more things to do and I should have more chances of getting a job there before school starts. I also plan to find a job on campus. I know cash advances aren't a good idea but I just want to move; I feel so limited here. If I don't, I will still leave at the end of August, I will have no other choice then, so technically I just have two months left. If I do now, is it a bad idea to use my credit card to pay for rent?

Edited by MisUnderstood1
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Art_Critic

That is expensive financing.. they can also charge a fee for cash advances.. typically 3-4% so that $1000 would be $1040 as soon as you charge it then if you don't pay it off in the grace period they charge the interest rate on top of that..

 

Expensive IMO, can your parents loan you the 1k instead, that way the payoff is easier ?

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Clarence_Boddicker

Not a huge deal if you are able to pay it off in full ASAP. I'd live very spartan before paying interest to Wall st.

 

 

Why not wait until you have the cash, then look for a place?

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OP do not fall into the advanced borrowing trap that banks set. You can only borrow 6 times a month and there's a huge penalty if you don't repay it plus the interest they will charge you. Right now, you don't need to screw up your credit standing with a bank scam like advanced borrowing. Just don't do it. Once your credit score falls, it takes a LONG TIME to rebuild it.

 

Since you are going to get financial aid, you can over-borrow the extra amount for the fall and spring semesters and use that as your rent money. That's what it is meant for. That's what I did, to finance my life during the 3 years I spent in grad school getting my masters degree. I used my fall and spring refund (the financial aid I over-borrowed after I borrowed enough to pay for my classes), to pay my apartment rent, my bills, my groceries and gas for my car. So, use your financial aid to support you. Also, look into moving into a roommate situation to save money. On your campus there should be a student organization that helps students find roommates. Or at least an electronic bulletin board or even old fashioned bulletin boards where you can find roommate listings.

 

You have 2 much better options (financial aid and a roommate situation) than borrowing from your bank against your checking account. Or get a part-time job while you're doing your post-grad as a teacher's assistant if you can swing it. Those positions pay enough to cover rent.

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I'm itching to move out of my parents' house. I had the opportunity to do that earlier this year when I had some money on me, enough to last for up to 5 months, but I stupidly allowed them to talk me into remaining at home, thinking I would be able to find a job and save money, which hasn't happened. All that money is gone now (long story) and I no longer have much. I am going back to school in September to do a post-grad program that would enable me to get a good job once I finish. I will be getting student loans and they're giving me a generous amount.

 

I got a credit card from my bank late last November and have been doing well with it, always paying on time. Recently, they increased my credit limit to $4,000, from $2,000. I didn't ask, they just sent me a letter saying they were pleased to increase my limit for being a good customer. If I move out now, I would have no other choice than to use my credit for cash adv to pay rent, that would be about $1000, as I'm looking to pay no more than $500 for rent. I do know that cash advs aren't good. I cannot find a job in this small city. The city I'm planning to move to is where I will be doing my program; it's bigger, more things to do and I should have more chances of getting a job there before school starts. I also plan to find a job on campus. I know cash advances aren't a good idea but I just want to move; I feel so limited here. If I don't, I will still leave at the end of August, I will have no other choice then, so technically I just have two months left. If I do now, is it a bad idea to use my credit card to pay for rent?

 

 

I would not advice taking on debt if you can avoid it. I'm still paying off my student loans from college and I kick myself every time I have to send in a payment to Sallie Mae. Take out the minimum amount of loans you need for your education. Try to find a job that will pay for your rent and other expenses prior to moving so you don't have to accrue credit card debt.

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I think it's a bad idea. Plus, the fact that you did not even realize that you could use your card for all purchases during the month (like food etc) instead of cash so that you can have cash left over to pay rent means you are not money saavy. Don't do it. You will ruin your life.

 

Also, I did not catch where you live but you ain't renting squat for 500 in Los angeles unless you get like two other room mates (who likely would not take you in since you have no real income).

 

Sorry guy.

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MisUnderstood1
I think it's a bad idea. Plus, the fact that you did not even realize that you could use your card for all purchases during the month (like food etc) instead of cash so that you can have cash left over to pay rent means you are not money saavy. Don't do it. You will ruin your life.

 

Also, I did not catch where you live but you ain't renting squat for 500 in Los angeles unless you get like two other room mates (who likely would not take you in since you have no real income).

 

Sorry guy.

Huh? I didn't realize I could use my credit card for all purchases, like food? I did not state that in my post, so I have no idea where you got that from or why you're assuming. Food and other purchases are what I've been using my credit card for. I think if I was using it terribly they wouldn't have increased my limit. The only reason for the $1000 for rent is because most landlords require first and last. I'm not looking into getting my own apartment now but shared accomodation, with one or two other roommates. Finding a room for $500 or less isn't difficult here in Canada. I just don't want to start ruining my credit score now so I will probably stay the two months.

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Credit cards are used intelligently when the user gets something from the card: buyer's protection, not having to carry large amounts of cash to the store for big purchases, mileage or points to be used later AND the user has the ability to pay off the card in full every month Carrying a balance is expensive and unwise.

 

 

If you can't afford to pay cash for something you probably shouldn't be buying it, the exceptions being tuition and a mortgage.

 

 

For you at this point in your life, if you don't have a job that will allow you to pay rent every month without the card, do not move out. Secure the job 1st. If you have to put the moving expenses on the card maybe that would be OK but not the rent. You will only end up in a hole you can't get out of. You sign a lease, you max out your card but don't have the money to pay the rent, you end up with a high interest card, a suit / judgment against you for the balance of the rent plus attorney's fees and you are back at home with a pile of debt.

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The end of August is only a couple months away. Why dig yourself deep into cash advance and credit card debt for a measly two months? The fact that you lost all that money you did have on something tells me that you aren't that good with managing money. Don't make things worse on yourself. Credit card debt is extremely hard to climb out of unless you have a good job.

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MisUnderstood1

The money I mentioned in the op was a gift given to me by a relative during the holidays. He later asked for it back because he was caught in a jam. I had no other choice but to return it to help him even though it had been a gift. So I didn't lose it because I spent it or I am not good with money. Yeah, the end of August is two months away but it just seems like eternity right now.

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You know what will seem like a real eternity? Five years from now when you realize you're still trying to pay off that cash advance only it's turned into $10,000 of interest debt on the $2000 you originally borrowed.

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Take a piece of tape, write "for emergency only" and stick it on the card. Then put the card in a safe and lock it. You will pay for everything in cash or using a debit card connected to your checking account. No money = no purchases.

 

You have no money so you can't get your own place. Simple.

 

Learn it now, the easy way. Or learn it the hard way after you've set your life back 5-10 years having to pay off debt you couldn't afford.

 

If you still want to move out then find a job. Sleep on a friend's couch and tell her you'll pay her when you get your first paycheck.

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