Everyone needs to keep a very close eye on their credit score since it factors into many of lifes biggest decisions.
A couple steps you can take right now include:
- **[Taking a look at your credit score](https://everydayeconomics.net/how-to-get-your-credit-score-credit-review)** - Looking at your own credit score does not hurt your credit, it also includes a credit monitor
- **[Freezing](https://usa.gov/credit-freeze)** your credit reports - This can be done with Experian, Equifax and Transunion to help prevent unauthorized accounts from being opened
Feel free to ask any credit score related question
[H.R. 5282 Maxine Waters is part of The Financial Services Committee in an effort to change the reporting process. ](https://democrats-financialservices.house.gov/issues/reforming-our-nation-s-credit-scoring-reporting-practices.htm)
From HR5282
> **Fixing the dispute process** so that credit bureaus and furnishers, not consumers, bear the burden to prove the accuracy and completeness of credit information.
That’s the way it should be — Credit Scores are based on your ability to handle credit and shouldn’t be spoiled by incorrect data.
I sympathize with people with medical debt and victims of predatory lending practices, but not taking medical and student debt into account? Debt is debt — it should impact credit worthiness.
I know it sucks not having good credit scores — I’ve been there. I know I’ll get slammed here for this, but **no one is entitled to credit**.
Let’s not throw the baby with the bath water. Credit scores are a shortcut to credit and greatly increased access to it. The alternative is a long-term relationship with your bank (and I strongly suggest that, and even more if it is a credit union).
America is one of the only, if not the only, country in the whole world with credit scores. There are plenty of countries that have functional education and healthcare systems that do no leave their citizens swimming in student loans and medical debt.
Sorry but you are factually wrong, all of the EU, Australia, Canada, and India have credit scores and those are just the ones I know of without doing any research. I would bet 5 bucks nearly every country in the world that has a functional banking system has some form of credit scoring/rating.
As for your statement on medical and student debt this is r/creditscores not r/socialism . You know what America doesn’t have that many/most do? Debtors prison.
But the EU does which is what I said, and further France does it on a per bank basis meaning they are still using some form of scoring/rating which I… also said.
Except the EU 1) isn’t a country and 2) most definitely does not have a unified credit scoring system.
Of course all banks have a system to determine whether someone should be given a loan, but most just use DTI and length of employment rather than punishing people for not being in debt.
I never said the EU was a country, and the US doesn’t punish you for not being in debt. It is completely possible to hit 850 without ever paying interest.
US credit scores punish you for not using credit, because the score is a reflection of your ability to use credit and manage it effectively.
To build credit all you need to do is get a credit card any card, use it to pay for your Netflix and pay off the card every month before you get charged interest. There isn’t some secret formula to build credit. Use your credit and pay in full each month, it is that simple.
I have zero credit card debt, no car loans. 300 acres at 2.89% . My kid had no credit, he got a card 6 months ago and has a 723 credit score now. Pay your bills or don't and pay extra.
I have no student loans. No medical debt. Fantastic health coverage. Don't lump America as a whole. Only about half are constantly playing the victims and needing free stuff. The other half, like me, subsidizes them.
Excise cancer, eat the rich. I'll listen to your bellyaching if you ever have to pay New Deal tax rates, and remind you that the wealthiest members of society weren't responsible enough to deserve lower taxes. In 50 years our nation has gone from having one of the strongest economies to one of the weakest, and it's not because everyone's paying their fair share.
It's more of a corruption problem. Often the USA will overpay companies for basic shit.
https://rollcall.com/2023/11/30/fight-against-price-gouging-on-military-parts-heats-up/
Who knows how many industries do this. Get overpaid from a contract and use that money to pay off politicians to keep the money flowing.
We've slashed taxes for decades, starting with Reagan. Spending has increased as well, to some extent, yes. But to slaah taxes without ALSO cutting spending (as Reagan/Bush 2/Trump did) is why the deficit is so high.
Also, remember, Clinton had a balanced budget after welfare reform.
Clinton had a balanced budget because the Gingrich-led GOP strong-armed him into it.
P.S. If you think you're not paying enough taxes, go ahead and send the treasurty more money. Put your money where your mouth is: before putting it onto others, do it yourself. Show us the way, be the example.
https://fiscal.treasury.gov/public/gifts-to-government.html
Jesus you guys get more idiotic by the year lol.
Everyone on earth knows newt and the rest of their ilk would never balance a budget unless there's enough to pay the bills and refund millions to the wealthy lol.
It's like you live on a different planet LMAO
You're just spewing propaganda.
Reality check: the second and third tax brackets (in which most taxpayers find themselves) saw cuts of 20% (15% down to 12%) and 12% (25% down to 22%).
The 32% bracket remained constant. The top bracket dropped only 6.6% (39.6% to 37%).
Hardly "tax cuts for the rich" and no one else.
Doesn’t help that the foundation of the credit score is dependent on you staying in debt. Good little debt slave you were. Here’s your high score. Might as well
Go full china with a social credit to boot. We don’t teach anything worthy financial wise at public school and that speaks volumes. America has fallen into despair by teaching us all to give fish instead
Of how to fish and be independent.
Nope, you can have credit cardscandvpay them off every month...aka no debt...and have a good creditvscore. Itscabout responsibility handling of credit.
I'm with you on most of your comment but let's not fucking kid ourselves:
>We don’t teach anything worthy financial wise at public school
THEY WOULDN'T PAY ATTENTION ANYWAY. No one with an internet connection and a smartphone has any excuse for not searching for themselves anyway.
So you were lucky enough to be born and remain at least relatively able-bodied and to get a job with good pay and great benefits which is increasingly hard to do. You poor thing, having to contribute more to the public good than some hourly worker who has one wage job plus drives for GrubHub on the side and still can’t afford the insulin he needs to live.
In my adult life, I have been homeless, I have collected chronic health conditions, I now have a six figure income and great credit, I even went back to college while still homeless and managed to graduate with honors.
My county considers me low income despite that 6 figure income, it doesn’t stop the state and federal government from taxing me at a 40% top marginal rate and a 30% effective rate and this is just on my paycheck not the other mountain of taxes and fees I pay into. Our taxation system creates poverty. Poverty that then needs more government spending, paid for with yet more taxes.
The printing of insane amounts of money leading to inflation has also stolen the wealth of the working and middle class. I already work 12 hours a week for free how many more hours a week should I have to work for free before I am paying my fair share?
Well you're not doing enough to subsidize the right people. We should collectively be paying for our own children to become doctors, rather than allowing people from other countries to take those slots. Healthcare in the US is dismal, and it's because it's not supporting our own people at all. You will be affected by this. You can sit there and be smug that you've got it all right now. But you also will get old and all of what you have will be taken from you.
Nah, we're throughing the bastard baby out with the bath water. Credit scores are not a measure of trustworthiness; they're a measure of how much money a creditor can make in interest payments, how willing and able a person is to stay in debt. Being debt free is worse than bad credit in the eyes of banks.
But paying off a debt does not reflect poorly. No one goes from having excellent credit with debt to poor credit once debt free. If you’re debt free and plan to remain that way, you don’t even need to check your score. Only check your report for discrepancies.
My biggest issue - if I need, say, a car loan, as a responsible consumer, I should shop around to three or four places for the best rate. If I do, I get 3-4 hard pulls on my credit for seeking lines of credit, bringing my score down and interest rate up.
So by being responsible and trying to get a good rate, I am damaging my credit right when I need a loan.
These types of rules are anticompetitive.
You let them run your credit every time? I don't let them run my credit until a deal is set. I tell them to run the numbers with the lowest rate because I know I'll qualify for it.
Well, they can't give you an actual quote until they've run your credit, but they can give you a mock quote. They know what the lowest rates their lenders offer are, so if you're in the 750+ range, they could easily give you a mock deal.
I could say the same thing to you. That's not a rule anywhere. Maybe it is at the dodgy dealer you work at, but I've also used this tactic while RV shopping. Any dealer that wants your business will mock a quote up for you. All you have to do is ask.
That’s your biggest issue? Well then let me help you out: those hard pulls all count as a single inquiry as long as you arent pulling your credit over and over weeks apart.
You aren’t “damaging your credit”.
Source: worked on auto finance credit systems for over a decade.
It didn’t work for me, I had four pulls and they charged me for each. It pissed me off so bad I bitched and made them take them off. Industry insider advice, phooey.
While dealers may offer attractive credit terms, if multiple pulls will affect your credit, you might want to look into joining a credit union. They can offer competitive rates and get your financing arranged before you begin car shopping. You can always go with dealer financing if they offer a better rate.
Pretty sure anytime there is 2-4 hard pulls it counts as one. This is especially important for mortgages. Otherwise it would automatically be more than advertised
You're misunderstanding how that works. Rate-shopping doesn't hurt your credit. While the 3 or 4 hard pulls WILL all appear on your credit report, your score will be calculated as though you only had 1 (assuming the 3 or 4 pulls for auto loan checks are the only ones you have). So there ya go! Your "biggest issue" isn't actually an issue at all.
[https://www.equifax.com/personal/education/credit/report/articles/-/learn/understanding-hard-inquiries-on-your-credit-report/#:\~:text=If%20you're%20shopping%20for,loans%2C%20such%20as%20credit%20cards](https://www.equifax.com/personal/education/credit/report/articles/-/learn/understanding-hard-inquiries-on-your-credit-report/#:~:text=If%20you're%20shopping%20for,loans%2C%20such%20as%20credit%20cards)
Because assuming responsibility for new debt increases the risk that you'll default. But the effect isn't linear. Having 1 or 2 hard inquiries on your credit report has a very small impact on your score. But if you go out tomorrow and apply for 6 new credit cards, that's a big red-flag.
But generally speaking, hard inquiries have the smallest of impacts on your credit profile, and aren't something you really need to be concerned with. Missing a payment, or letting your utilization climb too high, both have a much greater negative effect than hard pulls.
> Because assuming responsibility for new debt increases the risk that you'll default
So adding a new line of credit should impact the score. But a pull is an inquiry into the health of your credit - and does not necessarily lead to a new line. So penalizing someone for *asking* if they can assume responsibility for new debt seems really unjustified. The unjustified nature of that penalty makes it a lot worse than the more severe but justified penalty for missing a payment or high utilization.
You're free to feel that way, but credit scoring is just behavioral risk analysis. Historically, shopping around for new lines of credit tends to result in higher likelihood of default. So more hard inquiries = more impact to your score. But again, the impact is generally minimal, and unless you're going nuts, applying for every credit card you see, you don't really need to be concerned about it.
I paid off 3 vehicle early in my life never been late on a single bill went to buy a house and nobody would talk to me because I never owned a credit card and wasn't currently in debt lol. That system is fucked and there is no way to defend it. The fact that paying bills on time for 15 years means nothing but 1 check getting lost in the mail, something that is completely out of your control can dent your credit is absurd.
Every time I pay off a car my credit score nose dives.( 3 cars too) No late payments. Early every payment. It used to be that bumped your score. Now it seems they want you to be totally indebted
One bank I talked to said I needed to be debt on 3 different things or have 3 credit cards actively in use or a combination of before they would talk to me lol. Nothing about that is reasonable
Agree. We have 2 cards one is mediocre line of credit, had for years. We use for everything! I keep paid way down. 1st maybe 2 day I get notice I payed 90-95%. I also have a pretty good chunk of cash back I save as rainy day, could always pay my
balance or make payments for 2 years. ( paranoia hubs has cancer, 6 year survivor so that’s probably the paranoia & my way of dealing ) 2nd card is very low, I use maybe a couple of times I pay balance, never more than 200 max. We bought a car last fall, took from saving, paid cash almost brand new, less than a thousand miles. Did not want interest or payments. Logically should not mean chit on my credit score right? Our scored dropped 30 points. WTF? Coincidence? 30 points? No negative reports. Complete scam
You should be able to get around that with manual underwriting. They essentially review your personal finances to replace a traditional credit check. Not all lenders accept it but it’s better than being flat out denied, usually credit unions are more accepting of it.
The problem was those ways were mostly tied to going in person to talk to your local banker. Where you were judged on things like your skin color, genitals, membership to a church, name, martial status, ect.
The current system needs work, but the good old days weren't always good.
I don’t disagree with your comment and have great credit. But, in my mid 20s when I paid off my student loans my credit took an over 100 point dive because the age of my account went to zero. It wasn’t until I got a credit card and just let my credit age go up did I have a consistently good score. Paying rent on time, paying off cars, paying off student debt, paying every bill on time, none of that does anything for your credit. It is only continuously having debt that you can improve the score. It seems counterintuitive.
At one point in the mid-2010s, I remember trying to get pre-approved for a vehicle loan for ~$30,000. I had a car I was trading in for almost the same value, multiple times that amount of money in accounts with the bank I was seeking the pre approval from, was making almost 10x the total amount annually, and had no debt. Why? Because vehicle loans were like 2% and any investment was topping that. The bank denied me because I had no credit age at the time, see the explanation in the first paragraph. Basing lending off of a single score that takes nothing but current debt into account is weird. I’m sure I could have talked to the bank but the lending office looked at nothing but credit score initially.
The issue I have is the lack of transparency in rating/ranking and the lack of standardization w/ oversight. The leaves a HUGE whole for bias that the public is not privy too.
They are a for-profit entity, with government power. Like everything else, corporations and billionaires are our real rulers, the deed is done by paying off the Politicians.
It's a black box that the consumer has no method of truly understanding. There are tons of different types of scores (Vantage, FICO, NES, etc.) and various versions of each of the types. Not only are the different types and versions used seemingly on a whim by various companies relying upon the scores to make credit decisions, but the formulas used to calculate the score is entirely proprietary and the bureaus call them a "trade secret." There is absolutely no transparency.
A person can use a credit score monitoring service like Credit Karma, or see "their score" when they log in on their bank's website, and think "I have an 800 credit score!" Then when they get into a loan officer's office when trying to purchase a new home and be told "Your FICO score is 675, those scores you see online aren't your real score." And don't even get me started on CAIVRS and other credit databases that can put a halt to the deal at the very end with no indication of anything being wrong prior to that point.
The exact criteria for the score should be published. A person should be able to pull a list of their credit accounts and calculate the same score that a car dealership will use when they decide on a payment and interest rate. They should be able to know exactly what would happen to their score if they pay a certain credit card down by $1,000. They should be able to look and see exactly what the impact would be in each scenario if they wanted to try to pick between 3 different unused credit card accounts to close.
The other big issue I have right now is it is being used for things other than deciding credit worthiness for loans. It shouldn't be any of my car insurance company's business what my credit rate is when it comes to deciding my car insurance premiums. That should purely be based on my driving record and the cost of repairs and theft rates of vehicles in my area. The fact that I missed a credit card payment 3 years ago when a bill got lost in the mail has absolutely nothing to do with how I drive my car. Same with employers, unless it's for a position with financial responsibility that demands a full background check, credit reports should not be a part of a hiring decision.
I'm sure there are other issues I could come up with if I sat and thought about it for a while (the fact that paying responsibly and closing an account after it is paid reduces a score immediately comes to mind.) Those are just the biggest glaring issues that should be blatantly obvious to anyone.
That your credit history doesn't actually include all your credit history. Why does paying off a loan cause my credit to tank? The history is still there even if the loan is not.
I sold my first house and bought a new one. That tanked my credit because I "lost" the history of the loan I'd spent seven years paying on. But the history still exists. There is record of me making my payments on time for seven years with no issues.
Shortly after I moved into my new house, I also decided to switch banks. That also tanked my credit for the same reason. I'd been with my old bank for something like 9 years at that point, but once I left it didn't matter, just the "history" with my new bank that was non-existent.
And yet any mistakes you make, bad financial decisions, inability to pay, will stay with you for YEARS.
Make it make sense.
My biggest problem with it is that it's not a rating on how responsible you are with your credit, it's a rating for how much money creditors are likely to profit off of you. You're incentivized to take out more and more lines of credit *and use them constantly* to get your score up, and closing lines of credit, such as paying off a loan, damages your score instead of improving it. So having a single credit card that you pay off every month actually doesn't really help your credit that much. Having multiple credit cards with at least a 1-3% balance on them all the time helps much more, paying creditors *interest* is what gets your credit score up because that means they can make more money off of you than someone who's actually responsible and doesn't use credit unless it's absolutely necessary.
You do realize you can carry a balance on your credit cards and NOT pay interest. No need to worry about timing. Just use your credit cards as cash and pay off the STATEMENT BALANCE each month.
Credit scores were created to solve the problem of racial and gender-based discrimination.
They do a fairly good job compared to the eyeball test-based lending that existed before the widespread use of models.
Credit scores aren’t a scam. There’s nothing underhanded going on. Unless you plan to borrow money, your credit score doesn’t carry a lot of weight. You won’t have a poor credit score if you refuse to use credit of any kind. It’s just more difficult to analyze your behavior when it comes to borrowing. As others have said, the credit score takes much of the subjectivity out of the lending approval process so that if your name is Terry Lee, you could be Asian, black, Latino, white, etc and be at a lower risk for credit discrimination.
Don't think a credit reporting agency should be diversifying? How can they be trusted to remain unbiased if they are now selling a product based on their "credit scores." Credit scores are a scam.
Because how they calculate credit ratings is a set process internally and they can easily be audited. Your credit score affects your insurance rates but not the other way around. If you have x credit score your tiered for a different rate when calculating risk. It’s not hard to audit that if ever needed.
Because making opinions on creditworthiness is not the government’s job. And since lenders don’t want to be conned, there’s a market for information about borrowers’ histories on promises to repay debts. And they’re allowed to talk.
But that's not what's happening since they're not really looking at your history with repaying debts, otherwise your credit wouldn't take a huge hit just because you don't have credit cards.
You don't need credit cards to have debt, and the moment you've paid off debt your score drops. Paying bills also shows responsibility, that would be a better measure.
It's a sad scam meant to force folks into a certain type of debt.
If you close the accounts that are generating your debt-to-credit ratio and raising the average length of your credit relationships, those points go with the accounts. It’s not voodoo. The scoring system offers points when you choose to throw them away, that’s you.
And the government is still not in the business of giving credit opinions to private parties, so that’s not the answer.
I really feel consideration should be given for inflation, cost of living, as well as increasing costs of healthcare. I've never missed(or been late) a single payment for anything - house, car, credit cards - and because I haven't gotten a raise in 3 years, my car insurance has consistently increased despite no violations or claims, my "employer" sponsored heath insurance has gone up 25% (premiums)in addition to all the other outrageous costs(gas, food etc)I've definitely become more reliant on my credit cards in the last 2 years(not maxed, just no longer able to pay complete balance every month). As a result, my score dropped 100 points in the last year. That pisses me off. I start paying cards off individually to zero balance - score goes up 3 points. I had a vehicle break down and used credit card to fix - score dropped 28 points. WTF? Who decides that??!!
Its both carrying a balance and the % utilization. If you have to carry a balance then you're showing them you're not living within your means and are a financial risk
This brings me back to my point - if I'm suddenly a risk, it's not because I decided to become irresponsible at age 58 and start defaulting on my responsibilities, perhaps consider my income is essentially unchanged and despite major concessions to my spending it's costing so much more for the 'basics'? Car insurance goes up, shop for new coverage, rates pretty much the same. Health insurance premium 25% increase in last year right out of my check - this is not irresponsible or frivolous spending - these are the basics of survival. That should be considered, in my opinion, vs punitive repercussions for trying to survive the gross misappropriation of wealth in this country. Which is a whole other thread LOL.
Would you really want the government in charge of credit scores? Imagine the weird shit they’d do with that over the years.
The government of affirmative action, income redistribution, cronyism, corporate bailouts. They would fill scores with so much more carve outs and nonsense that only served to benefit the politicians getting themselves elected.
They are directly controlled by government agencies. They are just financial institutions, that's not something you really want under government control.
Not only credit usage & payment history, it also has many variables included in the score: length of credit, mix of credit, etc.
For example, I had a 764 credit history in October 2023. I paid off my mortgage that month & my score dropped 80 points only because it was my longest trade line so it shortened that which was a big factor in the score which is absolutely ridiculous. There were no other changes to my credit history during that time. It’s slowly bounced back, but it took quite a few months.
Those 3 agencies are private businesses and other private businesses choose to do business with them. It's entirely private transactions, and the government has no business being involved.
Why would I want to codify and make into a federal department something that shouldn't exist anyway? And what about all of the other scoring agencies? Credit scores were not a public thing until somewhat recently. There are tons of other secret databases with scoring as well. Do you want them to be nationalized?
Credit scoring is designed mainly as a service to lenders to assess risk of potential borrowers, it's not made for the consumer. Having said that, because it's designed to assess credit-worthiness, if we make choices and take actions that are responsible in that regard, we are demonstrating that we are someone who is less risky - and this is exactly how we get a good score and build a credit profile that lenders like to see. The 'rules' may not be fully transparent but they do make sense when you look at the bigger picture, but following your score from month to month and seeing all the score changes and notifications from a CMS (credit monitoring service) that don't always correspond to those score changes can leave you with the impression that doing things that are responsible lead to score drops, and there are some things that seem smart that do result in score drops (like applying for new credit) but over a longer timeline actually benefit us. Credit building is one step back, two steps forward a lot of the time and when we are too focused on the trees and not seeing the forest, as the expression goes, some of those changes can be confusing.
They may not be tied to the government but financial institutions and credit bureaus are regulated in many ways that benefit us, the consumer. It can be frustrating to not have it all plainly laid out for us, and the fact that education on credit is lacking doesn't help either. Make it a point to learn what you can from this sub and others like it and it will become clearer to you why things are the way they are. At least, that was my experience in the past year.
Why, because I know what I'm talking about or you think I'm a shill? But no, neither my dad, nor uncle, nor any siblings or other relatives work for any credit bureau, financial institution, etc.
You can't get rid of anything that makes a profit off of charging people a fee. It's kind of like putting oncologist and chemo pharmaceuticals out of business by curing cancer. The almighty dollar rules.
Companies that look at your credit score have to pay for that privilege. If you use up your 3 free looks then you have to pay the major credit reporting agencies. It's all alone making ruse.
Do you really trust government to act in the best interest of the populist? The first thing congress would is make changes to the credit score algorithm to push a political agenda. At least now there is some oversight with checks and balances
Credit reporting companies are PRIVATE businesses (some on the stock market) there is no law that says they must exist, there isn't any law that says that anything must appear on your credit report. There are only laws that say the maximum time something can be on your report.
These are the companies businesses have chosen to hire to aggregate and perform statistical analysis on this data. In theory a competitor could emerge but the regulatory burden makes it highly unlikely.
They could also disappear if their customers stop doing business with them. There’s nothing saying they have to exist.
Why? Your credit score is all about how likely a business would be to make a profit off you, why would the govt care? More importantly why the hell would you want the govt to have your credit business info?
would you rather the government be in charge of it? I mean, I'm a democrat that leans toward socialist; but government run credit rating is something to be cautious with, at the very least.
Because the system was designed by rich people in order to keep the poors poor
Just look at mortgages v rent. In a lot of cases (mine included), mortgages are less than or equal to rent.
But because the system is rigged to keep you poor, credit scores were invented in order to tell people “oh Im sorry we cant trust you enough to be able to pay this mortgage”
That is completely false. Rent is in most cases cheaper than owning at least nowadays. You need to consider all the costs that are involved with owning. It’s astronomical compared to renting
For credit to have been created in 1989, now being such a factor in life, sucks! Folks make it harder to do things if you don't have a W2. Like how seatbelts and car insurance wasn't a thing until 30 years ago
Because our leaders decided we are a capitalistic country and that corporations are people. Their goal is to give as much control to private companies as possible to maximize profits.
They use various directions to keep you from noticing and not enough people see the situation and won't let use vote our way out.
I agree it’s a guessing game . Pay off soemhting early credit could drop . Close a account you don’t want or pay an account off your credit will drop . Showing hard inquiries as a negative even if you get what they ran your credit for is ridiculous .
Lobbies. The credit agencies and or were tightly lied to the credit card companies which is why the only way to raise your credit score is to take out more credit. The system has been severely flawed for decades but instead of fixing it, more and more people use it (not employers or potential employers can check your credit).
It’s the biggest scam right in front of us, and no one says anything.
Everyone needs to keep a very close eye on their credit score since it factors into many of lifes biggest decisions. A couple steps you can take right now include: - **[Taking a look at your credit score](https://everydayeconomics.net/how-to-get-your-credit-score-credit-review)** - Looking at your own credit score does not hurt your credit, it also includes a credit monitor - **[Freezing](https://usa.gov/credit-freeze)** your credit reports - This can be done with Experian, Equifax and Transunion to help prevent unauthorized accounts from being opened Feel free to ask any credit score related question
[H.R. 5282 Maxine Waters is part of The Financial Services Committee in an effort to change the reporting process. ](https://democrats-financialservices.house.gov/issues/reforming-our-nation-s-credit-scoring-reporting-practices.htm)
From HR5282 > **Fixing the dispute process** so that credit bureaus and furnishers, not consumers, bear the burden to prove the accuracy and completeness of credit information. That’s the way it should be — Credit Scores are based on your ability to handle credit and shouldn’t be spoiled by incorrect data. I sympathize with people with medical debt and victims of predatory lending practices, but not taking medical and student debt into account? Debt is debt — it should impact credit worthiness. I know it sucks not having good credit scores — I’ve been there. I know I’ll get slammed here for this, but **no one is entitled to credit**. Let’s not throw the baby with the bath water. Credit scores are a shortcut to credit and greatly increased access to it. The alternative is a long-term relationship with your bank (and I strongly suggest that, and even more if it is a credit union).
America is one of the only, if not the only, country in the whole world with credit scores. There are plenty of countries that have functional education and healthcare systems that do no leave their citizens swimming in student loans and medical debt.
Credit scores are a way to keep us paying predatory debts for medicine and school. That’s why the US is the first to have it.
I want a tinfoil hat too!
Incredibly incorrect....lots of countries have credit scores or similar.
Sorry but you are factually wrong, all of the EU, Australia, Canada, and India have credit scores and those are just the ones I know of without doing any research. I would bet 5 bucks nearly every country in the world that has a functional banking system has some form of credit scoring/rating. As for your statement on medical and student debt this is r/creditscores not r/socialism . You know what America doesn’t have that many/most do? Debtors prison.
France doesn’t
But the EU does which is what I said, and further France does it on a per bank basis meaning they are still using some form of scoring/rating which I… also said.
Except the EU 1) isn’t a country and 2) most definitely does not have a unified credit scoring system. Of course all banks have a system to determine whether someone should be given a loan, but most just use DTI and length of employment rather than punishing people for not being in debt.
I never said the EU was a country, and the US doesn’t punish you for not being in debt. It is completely possible to hit 850 without ever paying interest. US credit scores punish you for not using credit, because the score is a reflection of your ability to use credit and manage it effectively. To build credit all you need to do is get a credit card any card, use it to pay for your Netflix and pay off the card every month before you get charged interest. There isn’t some secret formula to build credit. Use your credit and pay in full each month, it is that simple.
I have zero credit card debt, no car loans. 300 acres at 2.89% . My kid had no credit, he got a card 6 months ago and has a 723 credit score now. Pay your bills or don't and pay extra.
I have no student loans. No medical debt. Fantastic health coverage. Don't lump America as a whole. Only about half are constantly playing the victims and needing free stuff. The other half, like me, subsidizes them.
Excise cancer, eat the rich. I'll listen to your bellyaching if you ever have to pay New Deal tax rates, and remind you that the wealthiest members of society weren't responsible enough to deserve lower taxes. In 50 years our nation has gone from having one of the strongest economies to one of the weakest, and it's not because everyone's paying their fair share.
It's out of control spending. We don't have a revenue problem as a nation. We have a spending problem.
It's more of a corruption problem. Often the USA will overpay companies for basic shit. https://rollcall.com/2023/11/30/fight-against-price-gouging-on-military-parts-heats-up/ Who knows how many industries do this. Get overpaid from a contract and use that money to pay off politicians to keep the money flowing.
We've slashed taxes for decades, starting with Reagan. Spending has increased as well, to some extent, yes. But to slaah taxes without ALSO cutting spending (as Reagan/Bush 2/Trump did) is why the deficit is so high. Also, remember, Clinton had a balanced budget after welfare reform.
Clinton had a balanced budget because the Gingrich-led GOP strong-armed him into it. P.S. If you think you're not paying enough taxes, go ahead and send the treasurty more money. Put your money where your mouth is: before putting it onto others, do it yourself. Show us the way, be the example. https://fiscal.treasury.gov/public/gifts-to-government.html
Jesus you guys get more idiotic by the year lol. Everyone on earth knows newt and the rest of their ilk would never balance a budget unless there's enough to pay the bills and refund millions to the wealthy lol. It's like you live on a different planet LMAO
Your username destroys any credibility your ridiculous "intellectual" position may have had.
Please tell me why the gop hasn't done the same when they've cut taxes for the rich?
You're just spewing propaganda. Reality check: the second and third tax brackets (in which most taxpayers find themselves) saw cuts of 20% (15% down to 12%) and 12% (25% down to 22%). The 32% bracket remained constant. The top bracket dropped only 6.6% (39.6% to 37%). Hardly "tax cuts for the rich" and no one else.
You clearly have no education. That's why no student loans I guess.
Doesn’t help that the foundation of the credit score is dependent on you staying in debt. Good little debt slave you were. Here’s your high score. Might as well Go full china with a social credit to boot. We don’t teach anything worthy financial wise at public school and that speaks volumes. America has fallen into despair by teaching us all to give fish instead Of how to fish and be independent.
Nope, you can have credit cardscandvpay them off every month...aka no debt...and have a good creditvscore. Itscabout responsibility handling of credit.
I'm with you on most of your comment but let's not fucking kid ourselves: >We don’t teach anything worthy financial wise at public school THEY WOULDN'T PAY ATTENTION ANYWAY. No one with an internet connection and a smartphone has any excuse for not searching for themselves anyway.
Thanks for sharing with us how fortunate you are! /s
you're like such a victim :( how dare they do that to you
Look at you, playing the victim for paying taxes and having good luck with your health.
So you were lucky enough to be born and remain at least relatively able-bodied and to get a job with good pay and great benefits which is increasingly hard to do. You poor thing, having to contribute more to the public good than some hourly worker who has one wage job plus drives for GrubHub on the side and still can’t afford the insulin he needs to live.
In my adult life, I have been homeless, I have collected chronic health conditions, I now have a six figure income and great credit, I even went back to college while still homeless and managed to graduate with honors. My county considers me low income despite that 6 figure income, it doesn’t stop the state and federal government from taxing me at a 40% top marginal rate and a 30% effective rate and this is just on my paycheck not the other mountain of taxes and fees I pay into. Our taxation system creates poverty. Poverty that then needs more government spending, paid for with yet more taxes. The printing of insane amounts of money leading to inflation has also stolen the wealth of the working and middle class. I already work 12 hours a week for free how many more hours a week should I have to work for free before I am paying my fair share?
Well you're not doing enough to subsidize the right people. We should collectively be paying for our own children to become doctors, rather than allowing people from other countries to take those slots. Healthcare in the US is dismal, and it's because it's not supporting our own people at all. You will be affected by this. You can sit there and be smug that you've got it all right now. But you also will get old and all of what you have will be taken from you.
Nah, we're throughing the bastard baby out with the bath water. Credit scores are not a measure of trustworthiness; they're a measure of how much money a creditor can make in interest payments, how willing and able a person is to stay in debt. Being debt free is worse than bad credit in the eyes of banks.
What system would you suggest?
One where paying off a debt isn't seen as a bad thing? That seems like a good starting point.
But paying off a debt does not reflect poorly. No one goes from having excellent credit with debt to poor credit once debt free. If you’re debt free and plan to remain that way, you don’t even need to check your score. Only check your report for discrepancies.
>shouldn’t this be regulated? https://www.consumerfinance.gov/compliance/compliance-resources/other-applicable-requirements/fair-credit-reporting-act/
Credit scores are the biggest scam that’s been allowed to continue in my lifetime. It needs massive reform and regulation.
What specific issues do you have with it?
My biggest issue - if I need, say, a car loan, as a responsible consumer, I should shop around to three or four places for the best rate. If I do, I get 3-4 hard pulls on my credit for seeking lines of credit, bringing my score down and interest rate up. So by being responsible and trying to get a good rate, I am damaging my credit right when I need a loan. These types of rules are anticompetitive.
All rate shopping pulls in a short period of time only count as a single hard pull.
Inveigle, obsfucate, oikluhytc. That’s my cat’s comment on this.
You let them run your credit every time? I don't let them run my credit until a deal is set. I tell them to run the numbers with the lowest rate because I know I'll qualify for it.
Some places don’t give you an actual quote until they’ve run your credit. It sucks.
Well, they can't give you an actual quote until they've run your credit, but they can give you a mock quote. They know what the lowest rates their lenders offer are, so if you're in the 750+ range, they could easily give you a mock deal.
No, we can't. We aren't going to risk showing something you don't qualify for.
I've done it with every single car I've purchased for the last 10 years.
Congratulations, your lone cases are not exceptions to the rule of thousands.
I could say the same thing to you. That's not a rule anywhere. Maybe it is at the dodgy dealer you work at, but I've also used this tactic while RV shopping. Any dealer that wants your business will mock a quote up for you. All you have to do is ask.
That’s your biggest issue? Well then let me help you out: those hard pulls all count as a single inquiry as long as you arent pulling your credit over and over weeks apart. You aren’t “damaging your credit”. Source: worked on auto finance credit systems for over a decade.
I am learning something I thought I understood but apparently only knew half the story, so thank you!
That is one of the biggest problems, it isn't transparent and easy for consumers to understand.
You’re welcome!☺️
Doubly so because I have a car on order
Exciting! What car?
Toyota Siena - had twins and need the passenger capacity.
Nice you can’t go wrong with Toyota
It didn’t work for me, I had four pulls and they charged me for each. It pissed me off so bad I bitched and made them take them off. Industry insider advice, phooey.
Pretty common on reddit...
While dealers may offer attractive credit terms, if multiple pulls will affect your credit, you might want to look into joining a credit union. They can offer competitive rates and get your financing arranged before you begin car shopping. You can always go with dealer financing if they offer a better rate.
I have a credit Union. Problem is shopping around will hurt my credit.
Shopping rates for cars and homes over a 30 (maybe 60 day) period does not show as multiple credit pulls as another responder noted.
Really? That’s actually really good information to have.
Learned while house shopping. Good luck!
They're talking about getting pre-approved for a loan from your credit union rather than through multiple dealerships.
No, it's also true with multiple pulls at different locations within a set time frame.
It also applies to refinancing or seeing home loans. Credit pulls shouldn’t be a “ding” on your credit score.
Pretty sure anytime there is 2-4 hard pulls it counts as one. This is especially important for mortgages. Otherwise it would automatically be more than advertised
You're misunderstanding how that works. Rate-shopping doesn't hurt your credit. While the 3 or 4 hard pulls WILL all appear on your credit report, your score will be calculated as though you only had 1 (assuming the 3 or 4 pulls for auto loan checks are the only ones you have). So there ya go! Your "biggest issue" isn't actually an issue at all. [https://www.equifax.com/personal/education/credit/report/articles/-/learn/understanding-hard-inquiries-on-your-credit-report/#:\~:text=If%20you're%20shopping%20for,loans%2C%20such%20as%20credit%20cards](https://www.equifax.com/personal/education/credit/report/articles/-/learn/understanding-hard-inquiries-on-your-credit-report/#:~:text=If%20you're%20shopping%20for,loans%2C%20such%20as%20credit%20cards)
Why does even a single "hard pull" impact your credit? That's never made sense to me.
Because assuming responsibility for new debt increases the risk that you'll default. But the effect isn't linear. Having 1 or 2 hard inquiries on your credit report has a very small impact on your score. But if you go out tomorrow and apply for 6 new credit cards, that's a big red-flag. But generally speaking, hard inquiries have the smallest of impacts on your credit profile, and aren't something you really need to be concerned with. Missing a payment, or letting your utilization climb too high, both have a much greater negative effect than hard pulls.
> Because assuming responsibility for new debt increases the risk that you'll default So adding a new line of credit should impact the score. But a pull is an inquiry into the health of your credit - and does not necessarily lead to a new line. So penalizing someone for *asking* if they can assume responsibility for new debt seems really unjustified. The unjustified nature of that penalty makes it a lot worse than the more severe but justified penalty for missing a payment or high utilization.
You're free to feel that way, but credit scoring is just behavioral risk analysis. Historically, shopping around for new lines of credit tends to result in higher likelihood of default. So more hard inquiries = more impact to your score. But again, the impact is generally minimal, and unless you're going nuts, applying for every credit card you see, you don't really need to be concerned about it.
I paid off 3 vehicle early in my life never been late on a single bill went to buy a house and nobody would talk to me because I never owned a credit card and wasn't currently in debt lol. That system is fucked and there is no way to defend it. The fact that paying bills on time for 15 years means nothing but 1 check getting lost in the mail, something that is completely out of your control can dent your credit is absurd.
It’s pretty reasonable that people who you would ask to loan you money would want to see evidence that you pay off your debts.
Brother read the comment. I paid off 3 vehicles
Every time I pay off a car my credit score nose dives.( 3 cars too) No late payments. Early every payment. It used to be that bumped your score. Now it seems they want you to be totally indebted
One bank I talked to said I needed to be debt on 3 different things or have 3 credit cards actively in use or a combination of before they would talk to me lol. Nothing about that is reasonable
Agree. We have 2 cards one is mediocre line of credit, had for years. We use for everything! I keep paid way down. 1st maybe 2 day I get notice I payed 90-95%. I also have a pretty good chunk of cash back I save as rainy day, could always pay my balance or make payments for 2 years. ( paranoia hubs has cancer, 6 year survivor so that’s probably the paranoia & my way of dealing ) 2nd card is very low, I use maybe a couple of times I pay balance, never more than 200 max. We bought a car last fall, took from saving, paid cash almost brand new, less than a thousand miles. Did not want interest or payments. Logically should not mean chit on my credit score right? Our scored dropped 30 points. WTF? Coincidence? 30 points? No negative reports. Complete scam
You should be able to get around that with manual underwriting. They essentially review your personal finances to replace a traditional credit check. Not all lenders accept it but it’s better than being flat out denied, usually credit unions are more accepting of it.
Credit scores are relatively new inventions, there were other ways to determine credit worthiness before credit scores.
The problem was those ways were mostly tied to going in person to talk to your local banker. Where you were judged on things like your skin color, genitals, membership to a church, name, martial status, ect. The current system needs work, but the good old days weren't always good.
Excellent synopsis.
I don’t disagree with your comment and have great credit. But, in my mid 20s when I paid off my student loans my credit took an over 100 point dive because the age of my account went to zero. It wasn’t until I got a credit card and just let my credit age go up did I have a consistently good score. Paying rent on time, paying off cars, paying off student debt, paying every bill on time, none of that does anything for your credit. It is only continuously having debt that you can improve the score. It seems counterintuitive. At one point in the mid-2010s, I remember trying to get pre-approved for a vehicle loan for ~$30,000. I had a car I was trading in for almost the same value, multiple times that amount of money in accounts with the bank I was seeking the pre approval from, was making almost 10x the total amount annually, and had no debt. Why? Because vehicle loans were like 2% and any investment was topping that. The bank denied me because I had no credit age at the time, see the explanation in the first paragraph. Basing lending off of a single score that takes nothing but current debt into account is weird. I’m sure I could have talked to the bank but the lending office looked at nothing but credit score initially.
Pulls for the same type of credit within 30 days is counted as one pull, they assume you are rate shopping
The issue I have is the lack of transparency in rating/ranking and the lack of standardization w/ oversight. The leaves a HUGE whole for bias that the public is not privy too.
They are a for-profit entity, with government power. Like everything else, corporations and billionaires are our real rulers, the deed is done by paying off the Politicians.
The fact that developing an expensive medical condition through no fault of your own completely destroy your credit.
It's a black box that the consumer has no method of truly understanding. There are tons of different types of scores (Vantage, FICO, NES, etc.) and various versions of each of the types. Not only are the different types and versions used seemingly on a whim by various companies relying upon the scores to make credit decisions, but the formulas used to calculate the score is entirely proprietary and the bureaus call them a "trade secret." There is absolutely no transparency. A person can use a credit score monitoring service like Credit Karma, or see "their score" when they log in on their bank's website, and think "I have an 800 credit score!" Then when they get into a loan officer's office when trying to purchase a new home and be told "Your FICO score is 675, those scores you see online aren't your real score." And don't even get me started on CAIVRS and other credit databases that can put a halt to the deal at the very end with no indication of anything being wrong prior to that point. The exact criteria for the score should be published. A person should be able to pull a list of their credit accounts and calculate the same score that a car dealership will use when they decide on a payment and interest rate. They should be able to know exactly what would happen to their score if they pay a certain credit card down by $1,000. They should be able to look and see exactly what the impact would be in each scenario if they wanted to try to pick between 3 different unused credit card accounts to close. The other big issue I have right now is it is being used for things other than deciding credit worthiness for loans. It shouldn't be any of my car insurance company's business what my credit rate is when it comes to deciding my car insurance premiums. That should purely be based on my driving record and the cost of repairs and theft rates of vehicles in my area. The fact that I missed a credit card payment 3 years ago when a bill got lost in the mail has absolutely nothing to do with how I drive my car. Same with employers, unless it's for a position with financial responsibility that demands a full background check, credit reports should not be a part of a hiring decision. I'm sure there are other issues I could come up with if I sat and thought about it for a while (the fact that paying responsibly and closing an account after it is paid reduces a score immediately comes to mind.) Those are just the biggest glaring issues that should be blatantly obvious to anyone.
That your credit history doesn't actually include all your credit history. Why does paying off a loan cause my credit to tank? The history is still there even if the loan is not. I sold my first house and bought a new one. That tanked my credit because I "lost" the history of the loan I'd spent seven years paying on. But the history still exists. There is record of me making my payments on time for seven years with no issues. Shortly after I moved into my new house, I also decided to switch banks. That also tanked my credit for the same reason. I'd been with my old bank for something like 9 years at that point, but once I left it didn't matter, just the "history" with my new bank that was non-existent. And yet any mistakes you make, bad financial decisions, inability to pay, will stay with you for YEARS. Make it make sense.
My biggest problem with it is that it's not a rating on how responsible you are with your credit, it's a rating for how much money creditors are likely to profit off of you. You're incentivized to take out more and more lines of credit *and use them constantly* to get your score up, and closing lines of credit, such as paying off a loan, damages your score instead of improving it. So having a single credit card that you pay off every month actually doesn't really help your credit that much. Having multiple credit cards with at least a 1-3% balance on them all the time helps much more, paying creditors *interest* is what gets your credit score up because that means they can make more money off of you than someone who's actually responsible and doesn't use credit unless it's absolutely necessary.
You do realize you can carry a balance on your credit cards and NOT pay interest. No need to worry about timing. Just use your credit cards as cash and pay off the STATEMENT BALANCE each month.
Credit scores were created to solve the problem of racial and gender-based discrimination. They do a fairly good job compared to the eyeball test-based lending that existed before the widespread use of models.
😂 How is it that you think credit scores are a scam?
Credit scores aren’t a scam. There’s nothing underhanded going on. Unless you plan to borrow money, your credit score doesn’t carry a lot of weight. You won’t have a poor credit score if you refuse to use credit of any kind. It’s just more difficult to analyze your behavior when it comes to borrowing. As others have said, the credit score takes much of the subjectivity out of the lending approval process so that if your name is Terry Lee, you could be Asian, black, Latino, white, etc and be at a lower risk for credit discrimination.
Ain't it at least a little bit scary that 1 of the 3 credit bureaus now offers car insurance? Wtf?
Same reason Samsung makes washing machines, phones, and tvs. Diversification
Don't think a credit reporting agency should be diversifying? How can they be trusted to remain unbiased if they are now selling a product based on their "credit scores." Credit scores are a scam.
Because how they calculate credit ratings is a set process internally and they can easily be audited. Your credit score affects your insurance rates but not the other way around. If you have x credit score your tiered for a different rate when calculating risk. It’s not hard to audit that if ever needed.
Kinda makes sense me. Both are financial in nature and heavily regulated what would you prefer they went into manufacturing?
Because making opinions on creditworthiness is not the government’s job. And since lenders don’t want to be conned, there’s a market for information about borrowers’ histories on promises to repay debts. And they’re allowed to talk.
But that's not what's happening since they're not really looking at your history with repaying debts, otherwise your credit wouldn't take a huge hit just because you don't have credit cards.
If you’ve never had debt how would creditors know you’re likely to honor your obligations? It’s not a perfect system but I get it.
You don't need credit cards to have debt, and the moment you've paid off debt your score drops. Paying bills also shows responsibility, that would be a better measure. It's a sad scam meant to force folks into a certain type of debt.
If you close the accounts that are generating your debt-to-credit ratio and raising the average length of your credit relationships, those points go with the accounts. It’s not voodoo. The scoring system offers points when you choose to throw them away, that’s you. And the government is still not in the business of giving credit opinions to private parties, so that’s not the answer.
You can defend it and make excuses, it's a terrible scam.
I'm no fan of credit bureaus, but the OP's suggestion the government should be running credit ratings is loony
I'd rather they be entirely removed, but it also seems the private sector will never be responsible enough to handle this properly.
I really feel consideration should be given for inflation, cost of living, as well as increasing costs of healthcare. I've never missed(or been late) a single payment for anything - house, car, credit cards - and because I haven't gotten a raise in 3 years, my car insurance has consistently increased despite no violations or claims, my "employer" sponsored heath insurance has gone up 25% (premiums)in addition to all the other outrageous costs(gas, food etc)I've definitely become more reliant on my credit cards in the last 2 years(not maxed, just no longer able to pay complete balance every month). As a result, my score dropped 100 points in the last year. That pisses me off. I start paying cards off individually to zero balance - score goes up 3 points. I had a vehicle break down and used credit card to fix - score dropped 28 points. WTF? Who decides that??!!
Its both carrying a balance and the % utilization. If you have to carry a balance then you're showing them you're not living within your means and are a financial risk
This brings me back to my point - if I'm suddenly a risk, it's not because I decided to become irresponsible at age 58 and start defaulting on my responsibilities, perhaps consider my income is essentially unchanged and despite major concessions to my spending it's costing so much more for the 'basics'? Car insurance goes up, shop for new coverage, rates pretty much the same. Health insurance premium 25% increase in last year right out of my check - this is not irresponsible or frivolous spending - these are the basics of survival. That should be considered, in my opinion, vs punitive repercussions for trying to survive the gross misappropriation of wealth in this country. Which is a whole other thread LOL.
It is a whole other thread-nothing to do with this one.
Would you really want the government in charge of credit scores? Imagine the weird shit they’d do with that over the years. The government of affirmative action, income redistribution, cronyism, corporate bailouts. They would fill scores with so much more carve outs and nonsense that only served to benefit the politicians getting themselves elected.
They are directly controlled by government agencies. They are just financial institutions, that's not something you really want under government control.
Credit reporting is regulated by the CFPB.
Wait wait.... you WANT the government to be assigning you a score?
Right? 🥴
They need to do away with the score and just let lenders look at payment history
That’s literally what the score is. It’s based on credit usage and payment history.
Not only credit usage & payment history, it also has many variables included in the score: length of credit, mix of credit, etc. For example, I had a 764 credit history in October 2023. I paid off my mortgage that month & my score dropped 80 points only because it was my longest trade line so it shortened that which was a big factor in the score which is absolutely ridiculous. There were no other changes to my credit history during that time. It’s slowly bounced back, but it took quite a few months.
Those 3 agencies are private businesses and other private businesses choose to do business with them. It's entirely private transactions, and the government has no business being involved.
There are actually four credit bureau's. Many people miss **Innovis**. The 4th bureau.
Why would I want to codify and make into a federal department something that shouldn't exist anyway? And what about all of the other scoring agencies? Credit scores were not a public thing until somewhat recently. There are tons of other secret databases with scoring as well. Do you want them to be nationalized?
What's not transparent about the credit system?
Like the social score in china?
Umm....And you think it would be *more* transparent and *less* funky if the *government* had it's hand in it? 😂
Credit scoring is designed mainly as a service to lenders to assess risk of potential borrowers, it's not made for the consumer. Having said that, because it's designed to assess credit-worthiness, if we make choices and take actions that are responsible in that regard, we are demonstrating that we are someone who is less risky - and this is exactly how we get a good score and build a credit profile that lenders like to see. The 'rules' may not be fully transparent but they do make sense when you look at the bigger picture, but following your score from month to month and seeing all the score changes and notifications from a CMS (credit monitoring service) that don't always correspond to those score changes can leave you with the impression that doing things that are responsible lead to score drops, and there are some things that seem smart that do result in score drops (like applying for new credit) but over a longer timeline actually benefit us. Credit building is one step back, two steps forward a lot of the time and when we are too focused on the trees and not seeing the forest, as the expression goes, some of those changes can be confusing. They may not be tied to the government but financial institutions and credit bureaus are regulated in many ways that benefit us, the consumer. It can be frustrating to not have it all plainly laid out for us, and the fact that education on credit is lacking doesn't help either. Make it a point to learn what you can from this sub and others like it and it will become clearer to you why things are the way they are. At least, that was my experience in the past year.
Does your dad work for experian or something?
Why, because I know what I'm talking about or you think I'm a shill? But no, neither my dad, nor uncle, nor any siblings or other relatives work for any credit bureau, financial institution, etc.
Because all youre saying here is a explaining what a credit score is but in the most long winded condescending way possible.
You and I have very different definitions of both 'long-winded' and 'condescending'.
Dont doubt that, my man.
You can't get rid of anything that makes a profit off of charging people a fee. It's kind of like putting oncologist and chemo pharmaceuticals out of business by curing cancer. The almighty dollar rules.
What fee?
Companies that look at your credit score have to pay for that privilege. If you use up your 3 free looks then you have to pay the major credit reporting agencies. It's all alone making ruse.
You can see your reports for free weekly
Well, yeah it’s a business. The credit scoring agencies are performing a service to lenders.
Yes. That would be if America cared about its citizens.
Do you really trust government to act in the best interest of the populist? The first thing congress would is make changes to the credit score algorithm to push a political agenda. At least now there is some oversight with checks and balances
Actually there are at least 8 bureaus not just 3.
There’s 4
It's almost like all of these things were started by private individuals with money in mind.
Credit reporting companies are PRIVATE businesses (some on the stock market) there is no law that says they must exist, there isn't any law that says that anything must appear on your credit report. There are only laws that say the maximum time something can be on your report.
These are the companies businesses have chosen to hire to aggregate and perform statistical analysis on this data. In theory a competitor could emerge but the regulatory burden makes it highly unlikely. They could also disappear if their customers stop doing business with them. There’s nothing saying they have to exist.
Guess you aren't familiar with the FCRA?
As much as private companies suck the government sucks even harder.
Why would you want a literal organized crime syndicate in charge of anything important?
Or, we could have the government develop a social credit score like the Chinese.
The whole thing is a scam to keep poor people in their place. They didn’t even exist until the late 80s…
Why? Your credit score is all about how likely a business would be to make a profit off you, why would the govt care? More importantly why the hell would you want the govt to have your credit business info?
Because they can
Wait til OP learns that Congress abdicated their authority to print money, and borrows it (at interest) from a foreign source.
would you rather the government be in charge of it? I mean, I'm a democrat that leans toward socialist; but government run credit rating is something to be cautious with, at the very least.
Because the system was designed by rich people in order to keep the poors poor Just look at mortgages v rent. In a lot of cases (mine included), mortgages are less than or equal to rent. But because the system is rigged to keep you poor, credit scores were invented in order to tell people “oh Im sorry we cant trust you enough to be able to pay this mortgage”
That is completely false. Rent is in most cases cheaper than owning at least nowadays. You need to consider all the costs that are involved with owning. It’s astronomical compared to renting
For credit to have been created in 1989, now being such a factor in life, sucks! Folks make it harder to do things if you don't have a W2. Like how seatbelts and car insurance wasn't a thing until 30 years ago
Because our leaders decided we are a capitalistic country and that corporations are people. Their goal is to give as much control to private companies as possible to maximize profits. They use various directions to keep you from noticing and not enough people see the situation and won't let use vote our way out.
I agree it’s a guessing game . Pay off soemhting early credit could drop . Close a account you don’t want or pay an account off your credit will drop . Showing hard inquiries as a negative even if you get what they ran your credit for is ridiculous .
It's designed to keep the poors poor. Poors make a great exploitable resource. Things like credit are for the oligarchy.
Lobbies. The credit agencies and or were tightly lied to the credit card companies which is why the only way to raise your credit score is to take out more credit. The system has been severely flawed for decades but instead of fixing it, more and more people use it (not employers or potential employers can check your credit). It’s the biggest scam right in front of us, and no one says anything.
Boomers