Smart SpendingSmart Spending

Can your old sofa hurt your credit?

Somehow deciding to replace one thing can spread to 'needing' to replace others, and your credit scores can take a big hit.

By Jan 8, 2014 2:43PM

This post comes from Gerri Detweiler at partner site on MSN MoneyIt is such a well-known phenomenon that credit counselors have a name for it: "Old Sofa Syndrome." And if you’re not careful, it can wreak havoc on your budget -- and your credit scores.

A leather Chesterfield sofa © Maurice van der Velden/Getty Images
New homeowners are particularly vulnerable, but so are those who have lived in the same place or with the same furniture for years and decide to replace "just one thing."

Counselors with Consumer Credit Counseling Service of San Francisco warn clients to beware of Old Sofa Syndrome in their new homebuyer classes. Rick Harper, senior vice president CCCSSF, explains:

(We) remind them that often new homeowners run up their credit card balances soon after they close on their new home. This is especially true for first-time homebuyers.
All of a sudden the old sofa doesn’t quite look right in the new living room. So out goes the old sofa and in comes the new sofa, which is financed by the credit card. Then the old drapes don’t look right behind the new sofa and the process is repeated over and over.
Suddenly within a few weeks or months there is a huge credit card balance competing with the new mortgage payment and this is dangerous.

Large balances on credit cards can affect a consumer’s credit score dramatically.  In most scoring models, the debt consumers carry account for about a third of their credit scores, and one of the important factors evaluated is how close the balances on their revolving accounts (like credit cards) are to their credit limits. It's known as "utilization." Generally, the lower their debt in relation to their available credit, the better for their credit scores. Most consumers will be fine if they keep balances below 20% to 25% of their available credit, though 10% or lower is ideal. (You can find out how your debt is affecting your credit scores with a free tool like's Credit Report Card.)

The cure for Old Sofa Syndrome

The cure for Old Sofa Syndrome? Take a deep breath, and wait. Figure out whether the purchase fits into your budget, and really think about what will happen once you replace that one item.

Harper says he and his counselors ask household members to “agree not to make any major purchases for at least six months so they can adjust to their new mortgage payment. This will help insure their long-term homeownership sustainability.”

What about times when you have to make a purchase you haven’t saved for; the washing machine or refrigerator goes, for example?

"If you do end up spending more than you anticipated, be sure you put a plan in place to pay down the balance," Tom O'Donnell, senior vice president of Chase says. He points out that Chase Blueprint offers a feature that helps cardholders save on credit card interest and pay down balances faster. Or you can use a credit card calculator to figure out how much you’ll have to pay each month to pay off your balance in a specific time frame.

I experienced this syndrome firsthand recently. I had to buy some dining room chairs to replace ones our foster kittens destroyed. Soon I found myself looking for an entire new dining room set. Fortunately I didn’t find exactly what I was looking for, and eventually decided to stick with what I have.

But the replacement chairs I settled on will clash with the curtains, so those will have to go.

Hopefully I can stop there.

More from

Jan 8, 2014 4:24PM

So let me get this straight... An article posted last week stated that we NEED to buy stuff (continually buy stuff)) with a credit card in order to keep our credit rating high. Now this article comes along and essentially says not to buy stuff, for it could ruin our credit rating.

I say the so-called "experts" and "journalists" don't have a freakin' clue about... well anything.

Jan 12, 2014 6:18AM
I feel so sorry for the younger generation, Having to put up with this credit rating BS, didn't have this BS in my working days. Get the best education you can or learn a good skill. Life's gonna be rough.
Jan 12, 2014 7:48AM
Those old sofas hold a lot of change and also leftover cheetos- you can live off one for quite a while.
Jan 12, 2014 12:39PM
*WARNING* ....Reading articles from MSN and these so called experts can damage your's like hell! 
Jan 12, 2014 9:52AM
Does anybody really understand how this system works? Articles are contradictory on a weekly basis....Only thing for sure is no one knows how it works.
Jan 12, 2014 9:31AM
Burn your credit cards, close your bank accounts, cancel your insurance policies, walk away from your mortgages, stop buying useless junk you don't need anyway, quit living under the thumb and at the whim of these finance companies.  Bring these damned sons of dogs to their knees and rid our world of their foul and parasitical enterprises once and for all.
Jan 12, 2014 9:56AM
How about this? Lets start teaching children in depth ECONOMICS in school. Because it is evident that most people are need of this. From children all the way to Politicians. Children will learn and hopefully not make the same mistakes of previous generations and the best is that parents needing it will too. This should help the up coming generation the essentials of life and make better decisions. No need to read this propaganda from MSN. My son is eight years old and in the third grade and is being taught geometrics. For what I do not know, In life we start from the basic fundamentals but skim through everything to say ok this was done. Even now we talk about child obesity but we still have gym once a week for thirty minutes. What better place than with all of the children s classmates to run and play. With two income households its hard for a child to get out and play during the week.
Jan 12, 2014 9:56AM
there is three minutes I will not get back!
Jan 12, 2014 9:38AM
Credit ratings are a scam!  Why would any lender buy a report that doesn't depict the buyer as a bad risk when it comes to loaning money?  They can then legally blame high interest rates on  bogus credit scores.
Jan 12, 2014 11:26AM
I want to know what qualifications one must produce in order for a MSN Journalist to consider them 'experts' in a given field.  "The cure: take a deep breath, and wait", I mean that is pure genius....and then, to be able to top that statement by adding, "Figure out whether the purchase fits into your budget"....holy shlt....this person must be the Mensa king of like he had a friggin' epiphany with that one.   Seriously, to answer my own question, it is pretty obvious that if you can figure out which side of a sheet of toilet paper to use then you're in....... 
Jan 12, 2014 10:53AM
Everyone except the CONgress seems to be worried about credit scores.  if CONgress doesn't care, who else should?  I don't give a rip about my credit score.  If it is 0, that is fine.  If it is 1000, that is fine.  I don't care.  If I can't borrow from one, I'll try another.  Hasn't failed yet.
Jan 12, 2014 11:09AM
Yeah go out and replace that old sofa, the "old" sofa in my living room is worth about 100 times what the new piece of trash in the local store..............................
Jan 12, 2014 11:46AM
We get mixed messages all the time in this society:
Dumb money articles warn us to save,  then tell us how to spend,  or not spend.
Government simultaneously tells us to spend because 70% of our very stupidly based economy depends on consumer spending.  Then they tell us to save,  get out of debt,  and if we don't,  it's our own fault.
I'll gladly do all that when there are jobs that pay enough to actually afford both avenues at once,  which there aren't.

Jan 12, 2014 5:35AM
i thought bount replace'n the couch in my yard with a different one was a goodwill reject...had to much cat piss on it so i didn't take it...will this hurt my credit card rating...
Jan 12, 2014 10:04AM
The article said not to run up a high balance.  You can buy the couch just not the whole house full of furniture at one time. Everything in moderation.
This entire article is a scam from the "Buy A Sofa" foundation....

Jan 12, 2014 11:14AM
Hey, "Gerri Detweiler at partner site .", how about YOU explain to all of us here exactly how credit scores work?

I find it incredible that the credit rating agencies won't tell us. I also find it incredible that closing a credit card account actually HURTS our credit scores. It is an obviously responsible thing to do to  reduce potential credit risk, reduce temptation, and reduce possibilities for credit fraud and theft. Yet, if you do it, your credit score drops. What a freakin racket!
Jan 12, 2014 2:48PM
Anger over a stupid article can make your blood pressure go up....
Jan 12, 2014 12:48PM
Who lays awake at night thinking up the chitt.
Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
100 character limit
Are you sure you want to delete this comment?


Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.


Smart Spending brings you the best money-saving tips from MSN Money and the rest of the Web. Join the conversation on Facebook and follow us on Twitter.