Perhaps Liz Weston Will Explain

Liz Pulliam Weston is an exceptional writer. Her focus on finances could be a very dry topic but her articles are interesting and well written. Here is a recent example:

link: 12 Cool Money Tricks ( - for some reason, this page does not resolve well in IE at the moment.)

One of the things that I keep watching for in Ms Weston’s column is some understanding of how banks and credit companies assess customers. If you are completely debt free, you are considered a poor credit risk. I just don’t understand that. One would think that if you have managed your funds and remained free from debt, then you should be a welcomed customer, since you have proven to be a good money manager.

That, however, is not the case. It is only if you have debt and managed that debt will the financial institutions consider the person a good risk. In other words, being in debt has its rewards - which seems very odd to me.

Catherine