There was an interesting comment left by Shay from Australia:
I am always amazed by the freedom of credit given in americaâ€¦I live in Australia. I have a pretty clear credit history except for one little debt of $699 that was paid nearly 3 years ago. This little debt has caused me no end of trouble in me trying to apply for finance. I am not eligble for personal loans, not eliglble for credit cards let alone a home loan or anything else. Even when I did have a credit card I used it once to show I can use it and pay it off (all in 3 hours LOL) then I cut it up – that doesnâ€™t countâ€¦Only what I didnâ€™t pay once because I got into the argument with the telphone company over itâ€¦..
One thing I have learned from this blog and several others it seems to me credit is handed out pretty freely in America. Am I wrong? I would love to hear more on this.
Shay, I can’t speak for other countries, but I do feel that credit is handed out pretty freely in America. When I signed up for my first credit card, I was an 18 year-old college freshman. A little while later I had a credit card with a $500 limit. Over the years, my credit limit increased and it ended up higher than my annual income. Even today, our credit limit is higher than our income. It doesn’t add up in my mind.
Before I started blogging about our debt, I thought that we were pretty alone with the debt hole we got ourselves into. Today, it’s a different story. I can’t believe how widespread of a problem debt is. While I don’t usually view the credit card companies as the enemy (I do believe you can use them for “good”), I do think they sometimes give people enough rope to really do some damage. Every time we maxed out our cards, they raised our credit limit so we could charge some more.
It would be interesting to hear everyone’s thoughts on America’s debt problem and whether you think America gives credit too freely. After reading Shay’s comment, if we lived in Australia…it sounds like our financial situation would have taken a very different course.