Total Posts:11|Showing Posts:1-11
Jump to topic:

The big bad "Credit Score"

TUF
Posts: 21,310
Add as Friend
Challenge to a Debate
Send a Message
1/21/2012 5:35:35 PM
Posted: 4 years ago
This thread is in regards to the ever omnipotent, the over bearing, and the ever dooming credit score.
Credit has a huge effect on a lot of peoples lives.
It effects home buying, car buying, even in simple things like getting your T.V. service.

I have been trying to move out of my little apartment now for a long time, and I have found trying to get a home while having no credit was proving to be a little difficult.
So I started my little 'credit adventure'.
I have taken out several loans over the past 6 months, and have been paying them off in a timely manner in order to get good credit.
Finally, yesterday I checked my credit score hoping for a pleasant surprise, and was unfortunately dis-appointed, finding that a certain bank trying to check my credit had made a little over 10 different hard inquiries on my credit, dropping my once average score a severe 80 points.

The questions I would like to discuss with you in this thread are as follows:

1. Do you think the way credit scores are evaluated is fair?
Why or why not?

2. Do you think it should be neccesary to have a credit score for things like signing up with services?

3. How has credit effected, either for the better or the worse?

I just want to know how many of you agree with the credit score system, or dis-agree with it.

I personally totally understand the purposes of the credit score system, I just think some of the ways certain companies reports to the credit bureau's, is evaluated can be unfair at times, as in my situation.
As a lender, I would totally want to know that I am giving money to someone who has a long history of paying their bills on time.
"I've got to go and grab a shirt" ~ Airmax1227
TUF
Posts: 21,310
Add as Friend
Challenge to a Debate
Send a Message
1/21/2012 5:47:31 PM
Posted: 4 years ago
At 1/21/2012 5:39:35 PM, UnStupendousMan wrote:
Shouldn't this either be in economics or personal?

Yeah but then nobody would read it haha.
"I've got to go and grab a shirt" ~ Airmax1227
nonentity
Posts: 5,008
Add as Friend
Challenge to a Debate
Send a Message
1/21/2012 5:56:50 PM
Posted: 4 years ago
The credit score system could be better though... For example, where I work we use 'temporary' ratings, such as A, B, C, and E. Someone with an A rating is someone who pays their bills in full all the time. The more late payments you have, and the longer you keep balances on your credit card, and the higher the balance you owe is, the worse your rating is.

People typically have E ratings if they are always delinquent or over their limit, or have been caught committing fraud (such as kiting).

But did you know that if your credit card is one penny over the limit, even for the first time and even temporarily, for that moment you have an automatic E score? So if you try to apply for any credit products during that time, you will automatically be declined.

I think that's a little messed up. But yeah.
TUF
Posts: 21,310
Add as Friend
Challenge to a Debate
Send a Message
1/21/2012 6:01:44 PM
Posted: 4 years ago
At 1/21/2012 5:56:50 PM, nonentity wrote:
The credit score system could be better though... For example, where I work we use 'temporary' ratings, such as A, B, C, and E. Someone with an A rating is someone who pays their bills in full all the time. The more late payments you have, and the longer you keep balances on your credit card, and the higher the balance you owe is, the worse your rating is.

People typically have E ratings if they are always delinquent or over their limit, or have been caught committing fraud (such as kiting).

But did you know that if your credit card is one penny over the limit, even for the first time and even temporarily, for that moment you have an automatic E score? So if you try to apply for any credit products during that time, you will automatically be declined.

I think that's a little messed up. But yeah.

So you have escaped the national credit score system into this credit rating system? And lenders look at that score rather than your numerical transunion, equifax, and experian score? How exactly do you do that?
"I've got to go and grab a shirt" ~ Airmax1227
nonentity
Posts: 5,008
Add as Friend
Challenge to a Debate
Send a Message
1/21/2012 6:06:32 PM
Posted: 4 years ago
At 1/21/2012 6:01:44 PM, TUF wrote:

So you have escaped the national credit score system into this credit rating system? And lenders look at that score rather than your numerical transunion, equifax, and experian score? How exactly do you do that?

No, I work for a bank. You have a credit score with transunion and equifax and all of that, but if you were to apply for a product with the bank they take all of that into account. I'm not sure exactly how the process works. I just know that if your credit card is over the limit or your overdraft on your account is past its limit, it changes your rating on our system.
nonentity
Posts: 5,008
Add as Friend
Challenge to a Debate
Send a Message
1/21/2012 6:08:41 PM
Posted: 4 years ago
At 1/21/2012 5:56:50 PM, nonentity wrote:
So if you try to apply for any credit products with us during that time, you will automatically be declined.


Sorry, I should have been more specific.
TUF
Posts: 21,310
Add as Friend
Challenge to a Debate
Send a Message
1/21/2012 6:16:21 PM
Posted: 4 years ago
At 1/21/2012 6:08:41 PM, nonentity wrote:
At 1/21/2012 5:56:50 PM, nonentity wrote:
So if you try to apply for any credit products with us during that time, you will automatically be declined.


Sorry, I should have been more specific.

I think that's kind of a more fair system, then the national one. It's lot easier to follow, and small things, or bad reports probably wouldn't effect your report as much.

I work for directv and dishnetwork, and I have DNQ's (did not qualify) all day. It's weird that people should have to have good credit to get a utility, such as satellite tv. Especially when your already locking them into a binding contract along with it the credit check.
"I've got to go and grab a shirt" ~ Airmax1227
nonentity
Posts: 5,008
Add as Friend
Challenge to a Debate
Send a Message
1/21/2012 6:24:21 PM
Posted: 4 years ago
At 1/21/2012 6:16:21 PM, TUF wrote:
At 1/21/2012 6:08:41 PM, nonentity wrote:
At 1/21/2012 5:56:50 PM, nonentity wrote:
So if you try to apply for any credit products with us during that time, you will automatically be declined.


Sorry, I should have been more specific.

I think that's kind of a more fair system, then the national one. It's lot easier to follow, and small things, or bad reports probably wouldn't effect your report as much.


Umm I'm pretty sure the national system still affects your rating with us... For example, if you've got a poor Equifax rating you will also have a poor rating with us. The difference is if your rating is A all of the time, being over your credit limit automatically makes you an E. I'm not 100% sure about that though and I'm too lazy to ask :p

I work for directv and dishnetwork, and I have DNQ's (did not qualify) all day. It's weird that people should have to have good credit to get a utility, such as satellite tv. Especially when your already locking them into a binding contract along with it the credit check.

Yeah I'm not really sure about that. I also don't understand why looking for an apartment effs up your rating...
TUF
Posts: 21,310
Add as Friend
Challenge to a Debate
Send a Message
1/21/2012 6:54:09 PM
Posted: 4 years ago
At 1/21/2012 6:24:21 PM, nonentity wrote:
At 1/21/2012 6:16:21 PM, TUF wrote:
At 1/21/2012 6:08:41 PM, nonentity wrote:
At 1/21/2012 5:56:50 PM, nonentity wrote:
So if you try to apply for any credit products with us during that time, you will automatically be declined.


Sorry, I should have been more specific.

I think that's kind of a more fair system, then the national one. It's lot easier to follow, and small things, or bad reports probably wouldn't effect your report as much.


Umm I'm pretty sure the national system still affects your rating with us... For example, if you've got a poor Equifax rating you will also have a poor rating with us. The difference is if your rating is A all of the time, being over your credit limit automatically makes you an E. I'm not 100% sure about that though and I'm too lazy to ask :p

Hmmm... What bank do you work for?

I work for directv and dishnetwork, and I have DNQ's (did not qualify) all day. It's weird that people should have to have good credit to get a utility, such as satellite tv. Especially when your already locking them into a binding contract along with it the credit check.

Yeah I'm not really sure about that. I also don't understand why looking for an apartment effs up your rating...

Not an apartment. A house. The bank I applied for did like 10 hard inquires on my credit. Every time someone does a credit check it pulls from your credit a few points
"I've got to go and grab a shirt" ~ Airmax1227
Double_R
Posts: 4,886
Add as Friend
Challenge to a Debate
Send a Message
1/21/2012 11:31:08 PM
Posted: 4 years ago
At 1/21/2012 6:24:21 PM, nonentity wrote:
Umm I'm pretty sure the national system still affects your rating with us... For example, if you've got a poor Equifax rating you will also have a poor rating with us. The difference is if your rating is A all of the time, being over your credit limit automatically makes you an E. I'm not 100% sure about that though and I'm too lazy to ask :p

Part of how your credit scores are calculated is by your credit to debt ratio. If you are over your barrowing limit, lenders see this as a risk because it looks like you are overextending yourself which is an indication of irresponsibility.