Is Credit Scoring Is Eroding Away The Middle Class

[rsmith6621]

Poll question: Is Credit Scoring Is Eroding Away The Middle Class

With all the background checks and employers are increasingly using credit scoring to determine responsibility and reliability do you think that corporate America is using this to further erode the middle class ability to stay in the middle class considering that many MC have had some recent credit issues with the recent economy....

[GreenPartyVoter]

1. Credit score checks can hurt poor people too.

[AsahinaKimi]

10. Absoultely!

In San Francisco you can't rent an apartment without one.. think of all those HOMELESS who finally get a job and are on their feet..and the landlords shut the doors in their faces.. or Vets on disability, can't even get a place to live, because they don't even have a credit score. The whole system sucks.. its for the rich only.. Meh! これわふべんでたまりません!

[HysteryDiagnosis]

2. Credit scoring, a criminal activity with little or no redeeming value.

I cannot stand how these self important bastards threaten (in a way) the sense of security that people attempt to have. Personally I think they should all be done away with, don't have a need for them, never did, never will. They seem like parasites that feed on the financially shaky, the fiscally insecure. It seems to be just another thing that needs to disappear and never return.

[Nye Bevan]

14. Yes. Preferring to lend money to people who are more likely to repay it is *outrageous*.

And auto insurance companies should not be allowed to discriminate against people who have a few DUIs, either.

[Raster]

16. The OP was referring to using credit scoring as a means of denying employment or

denying people housing. Your BULLSHIT comment about lending is just that: BULLSHIT. The OP DID NOT mention credit scoring and lending: you did.

[Nye Bevan]

17. I wasn't replying to the OP (nt)

[HysteryDiagnosis]

18. Exactly my point. n/t

[Dreamer Tatum]

22. How EXACTLY is it criminal?

I mean, PRECISELY. Please tell me how the act of credit scoring is CRIMINAL.

Silly, bullshit assertion.

[HysteryDiagnosis]

41. It's a crime to threaten people with such silliness that if they don't

bend to these credit score co's assertions, smoke and mirrors that somehow they will be in dire straights. Poppycock. They need to mind their own bidness.

[SoCalDem]

3. For the ones still on the "borrow-train", yes, BUT

for people who got off that train, it's no biggie.. I couldn't care less what our FICO score is, because we have lived in the same home for 34 years, and do not plan to buy a house again.. we pay cash for cars & only use our one credit card when we check into a hotel or rent a car..

People need to get back to using cash & savings, instead of buy-now-pay-later.

There are ALWAYS alternatives to bigger/shinier/newer, until you have saved up the money necessary to buy whatever it is..

I have a friend who would run all over the place trying to save 20% on something, and then put it on a credit card.. Of course she did not pay it off, so she "saved" nothing...

Our media/advertising community has somehow convinced us all that we simply must have everything, and we need it NOW..

[Curmudgeoness]

7. But are you comfortable that your insurance rates could be higher

because you have a lower FICO score? Homeowners insurance, auto insurance, life insurance? Or you could have problems finding a good job if you needed one because of a low score (or not history)?

The biggest problem with these scores is that they are being used for so many things that should have no bearing on how your credit (or a lack of any history) stands.

[SoCalDem]

11. I know we are getting a break on our insurance because we have had the same

insurance since 1969 (State Farm ) & they bend over backwards to keep us happy:) (we have compared prices)
Even though I don;t care what it is, I suspect that our score may not be low, since we do have one card and pay it every time we use it, and we are not late on our bills

[Mimosa]

42. Most people don't understand how the 'credit score' has come to dominate n/t

[Hutzpa]

9. You speaking as if everyone can afford to pay cash for products

where is the sympathy for people that fell into hardship because their jobs got
outsourced? What about those who lost their jobs because corporation packed up
and moved to where they can find cheap labor.

I love being a democrat because of our compassion, our empathy toward others
who are suffering, not this selfishness of me me first.

[SoCalDem]

15. How am I being "selfish" by stating the obvious?

Buying "stuff" on credit hurts most people. You are "buying stuff NOW" with money you have not earned yet, and if "something happens", and you cannot earn that money...well you still owe it..

Our family has had MANY rough patches over the years, and we have lived in some pretty nasty places, but it was all we could afford... We have had $15 refrigerators, free stoves & handmedown furniture.. we have always driven used cars..

We also happen to be very generous with help for others... as for the "me first" you somehow thought you saw, it's not a bad thing to see to it that your own family has some security, instead of a mailbox full of bills..

It's much easier to help others if you are not hopelessly mired in debt yourself..

[Hutzpa]

20. I'm not sure whether majority of people live life like the way you've explained it

to me that is a Republican myth that people are living above their means so it is their fault that they find
themselves in the situation they're in, that is malarkey in the highest order.

Furthermore did you know our President was broke before he gave that speech at the democratic convention?
before he had all the money from his books sales he could not pay his credit card bills, yet, once he made money and
became President, that has not stopped him from fighting for the little guy, some may argue otherwise but I believe
he is fighting for the small guy, yes he did not anticipate how deep rooted our problem is, but there is no other person
I will have fighting.

When I see posts like yours it also reminds me of this mindset that most Americans tends to have which is "I've got mine
now you go get yours" and "I worked hard for mine why should'nt you" these are the thinking that prevented
Single Payer because the haves carry this concept within them that it is not their responsibility to take care of the little guy.

It's not something that democrats in general carry but it is an observation I have made lately creeping in to the democratic party,
which I blamed partly to our large umbarella. It will be a shame to see some within the democratic party adopt this mindset.

[coalition_unwilling]

25. I hate to be a Math Nazi, but your friend running around for 20%

discounts, placing said purchases on her credit card, and then not paying the credit card balance in full may still have saved something (assuming her annual APR was in the neighborhood of 20%).

The reason is that she got the 20% discount immediately. However, 20% of the purchase was not tacked onto the credit card at the end of her billing statement. At a 20% APR, approximately 1.75% would be tacked on at the end of the first month the balance was not paid in full (assuming she had exhausted her grace period).

I tend to use my own credit card for emergencies only and then try diligently to pay off the entire balance at the end of each month. Most of the time I am successful but even when I am not, I usually have paid it off within 2-3 months. So when I do use my credit card to snag a 20% discount when i don't have ready cash available, I feel like I really am saving money on a purchase that I might not have been able to amke at the time without the credit card, even though it ends up perhaps taking 2-3 months to pay off the balance.

[SoCalDem]

28. unfortunately for her, she keeps a high balance on her cards

:(

[coalition_unwilling]

32. Ah, well that does change matters. Sounds like your friend could

use a couple basic math refresher courses. Because the obverse of what I wrote is also true. If your friend takes too long to pay off her balances, the item she acquired at a nominal 20% discount may actually end up costing her much more (when interest and fees are added into the calculation). In that case, the 20% discount helped the vendor make the sale but at the expense of your friend's continuing debt peonage.

Don't think I need to draw the math out for you, b/c it sounds like you know the score already.

[SoCalDem]

33. She ended up declaring bankruptcy, so now she pays cash

and actually has a savings account now.. I don't think she's gotten another credit card since

[CreekDog]

45. yeah you don't need a credit score if you don't mind being homeless

Or need a job where you can eat, shelter yourself and your kids.

I mean if toy simply must have skill those luxuries the United Nations considers there basic human rights, then there must be something wrong with you.

I don't have the ability to explain but some here are happy to lecture all of us.

[aikoaiko]

4. criminal and credit background checks are reasonable.

But I bet a lot of employers don't use them intelligently.

[TwilightGardener]

5. I'm fine with credit scoring only if it's used when someone wants to borrow

a large sum of money, and not for employment or anything else. I try to have a good score because I will probably never have 10-20 thousand sitting around just to buy a car, or more to buy a new house.

[moondust]

19. +1 for only used for financial matters.

Some people probably get trapped in the catch-22 of low credit rating means can't get a job and no job means can't improve credit rating.

[robcon]

6. I think creditors have the right to know prior history of borrowers.

Is it eroding the middle class? Maybe.

[hobbit709]

30. Borrowers, yes. Insurance, employment(unless handling money) no.

[Hutzpa]

8. This is the reason why I despises Republicans and some Blue Dogs Democrats

they allowed corporation to enact this law that has helped to bankrupt the middle class,
it was design specifically to control ethnic minorities in this country. I believe the
idea came from England.

[REP]

12. I'm on SSDisability and have a near-perfect score -credit can be used wisely by anyone

[wickerwoman]

51. Until they become a victim of identity theft.

My parents had their credit card numbers stolen by a Blockbuster employee (who also stole DVDs using their video card) and then they got turned over to a collection agency for "late fees" on a bunch of porn videos.

Six years later, their credit rating isn't back to where it should be.

Part of the calculation is how often you change addresses because that's a sign of how "stable" you are. But I know people with internationally mobile careers who make six figure salaries and have no debt. Should they have a low score because their high-paying jobs require them to move a lot?

The whole rating system is fundamentally unsound and its being used to discriminate unfairly against people by taking a completely out of context statistic and using it as the basis of a moral judgment.

[MadMaddie]

13. Credit Scoring which uses secret formulas is criminal

We don't know how they score, all we know is they can drop your score for whatever points they want and it happens quickly. When you try to fix your score by fixing mistakes or just wrong data it takes months and years. It's a scam/

[Dreamer Tatum]

23. Not true.

Completely false. Educate yourself.

[Gormy Cuss]

44. Credit scoring is proprietary, isn't it?

Vendors like Fair Isaac have made a point to describe in broad terms how credit scores are derived but I'm unaware of any public disclosure of the actual algorithms used. Can you point to some place where that data can be obtained? I know that when one of my colleagues was granted access to the Fair Isaac model he had to sign a pretty stiff nondisclosure agreement. This was back when FICO was based in the San Francisco area.

[CreekDog]

48. so you reduce available credit to yourself and your score can go down

perfectly fair, no?

i closed a Citibank account because they changed my terms and I had a zero balance. it reduced my credit score.


SCAM!

[MadMaddie]

56. Exactly!

[Hannah Bell]

21. the whole credit score scam is yet another part of the growing surveillance state

intended to keep all the peons in check.

[Dreamer Tatum]

24. Scam?

As an expert in credit scoring, your post makes me laugh. Credit scoring separates the good risks from the bad risks, and provides a rationale for that separation.

[Hannah Bell]

34. lol. what bullshit.

[Dreamer Tatum]

35. Yes, your post was. Glad to see you admit it. nt

[Hannah Bell]

36. "expert in credit scoring" = lol.

[Dreamer Tatum]

37. I am an expert. 15 years worth of experience.

Don't particularly give a shit what someone who is completely uneducated in the practice thinks about it.

Your posts on the matter betray your complete ignorance, which is expressed by way of cynicism. Yawn.

Go post about something else.

[rucky]

40. Risks for what?

Lenders, maybe - but employers? How about utilities who check your credit to determine your deposit? Or insurance companies who use it to determine your premiums? Credit card companies that use your FICO as an excuse to jack up your rates to loan-shark proportions?

They're using it to block access to necessities and targeting the people at a point in their lives when they can least afford it. Using double-binds like this to control groups of people is nothing new.

Furthermore, it's a private corporation doing this and yes, the formula is proprietary and is created and adjusted at-will to serve the needs of creditors.

Scam.

[Curmudgeoness]

52. Credit scoring can separate risks, but

as an expert in credit scoring, you must know of the problems with erroneous reports or identity thefts. And you would know that there is no easy way for the person who is victimized to get it remedied. The person whose report you are selling is not your customer. You do not care if the information is right or wrong, or at least this is how it appears when errors cannot be corrected in a timely manner. Until the credit scoring industry takes the reliablity of their information more seriously, I do not think that it should be used for non-credit related purposes.

If you remember, laws had to be changed just to allow people free access to their own information because the industry was not interested in making absolutely sure that the information reported was accurate. And even then, the information you have free access to is minimal and close to useless. And the industry continues to destroy good people.

[Gormy Cuss]

26. Pervasive use of credit REPORTS, not credit scoring.

Potential employers and landlords are sold copies of credit reports without the score. This is in some ways far worse because they are privy to far more data on your private life. At least the credit score is only a number assigned by a consistent algorithm with known limitations. Your credit report allows employers full access to whatever records have been mined in your name/SSN: where you bank and your bank balances, where you have credit and where you've lived.

In most cases none of that information is relevant to employment but you can bet that some employers do try to read something important into that information even when you have absolutely no bad marks on your credit. While landlords can benefit from confirmation of your bank balances and residence history, they have no business knowing which creditors unless your account is in default. Even then, they have no need to know to whom the money is owed.

What some landlords and employers do is apply their own version of credit scoring by informally categorizing the credit information and there is nothing that the applicant can do about it. For example if a small landlord thinks that people with Amex cards make better tenants than people with Sears cards the choice of tenant can be made on that basis without any of the potential tenants ever finding it.

[tammywammy]

29. +1 n/t

[cbdo2007]

27. No, credit USING is destroying the middle class.

People have too much debt for shit they don't need.

[lumberjack_jeff]

31. If your middle class lifestyle was sustained only at the cost of acquiring a shitty credit record...

... you were never middle class to start with.

[coalition_unwilling]

38. To quote the band Cake, "How Do You Afford your

'n Roll Lifestyle?" (Aweseom song, btw)

**********************

Well, your CD collection looks shiny and costly.
How much did you pay for your bad Moto Guzi?
And how much did you spend on your black leather jacket?
Is it you or your parents in this income tax bracket?

Now tickets to concerts and drinking at clubs,
Sometimes for music that you haven't even heard of.
And how much did you pay for your rock'n'roll t-shirt
That proves you were there,
That you heard of them first?

How do you afford your rock'n'roll lifestyle?
How do you afford your rock'n'roll lifestyle?
How do you afford your rock'n'roll lifestyle?
Ah, tell me.

How much did you pay for the chunk of his guitar,
The one he ruthlessly smashed at the end of the show?
And how much will he pay for a brand new guitar,
One which he'll ruthlessly smash at the end of another show?
And how long will the workers keep building him new ones?
As long as their soda cans are red, white, and blue ones.
And how long will the workers keep building him new ones?
As long as their soda cans are red, white, and blue ones.

Aging black leather and hospital bills,
Tattoo removal and dozens of pills.
Your liver pays dearly now for youthful magic moments,
But rock on completely with some brand new components.

How do you afford your rock'n'roll lifestyle?
How do you afford your rock'n'roll lifestyle?
How do you afford your rock'n'roll lifestyle?

Excess ain't rebellion.
You're drinking what they're selling.
Your self-destruction doesn't hurt them.
Your chaos won't convert them.
They're so happy to rebuild it.
You'll never really kill it.
Yeah, excess ain't rebellion.
You're drinking what they're selling.
Excess ain't rebellion.
You're drinking,
You're drinking,
You're drinking what they're selling.

More from artist :
Cake

More from album :
Motorcade of Generosity

[lumberjack_jeff]

39. "You're drinking what they're selling" +1 n/t

[Obamaforthewin]

43. Good scores

It's not that tough to have a good credit score, and you certainly don't have to be rich. All you have to do is pay on time the obligations that you have taken on. That's it for the most part.

[CreekDog]

46. and not be a victim of identity theft, or credit reporting error, or...

:eyes:

[Obamaforthewin]

53. There are solutions

You can fix those errors, it's a pain in the ass...but you can fix them.

The people that have bad credit due to those problems are few, and it's fixable.

[CreekDog]

54. are you saying that it's okay to be judged on errors?

[Obamaforthewin]

55. No, I'm not.

But no system is ever going to be 100%. This system is pretty good at determining behaviors associated with borrowing money and money management.

If you personally were going to lend someone your money, would you like to know something about them? Would you be more likely to lend to, say a friend, that you knew their history, or a complete stranger?

My guess is that you would never lend money to a complete stranger, but may lend to someone you thought would more than likely actually pay you back.

That is what the credit score system does, in a nutshell.

[w8liftinglady]

47. One brain tumor made mine go from good to shit in two years.

Don't sell me a fucking house....
But Keep me from renting an apartment or getting a job? It is immoral to use this as anything but a CREDIT check.

[Initech]

49. It's another tool of the wealthy elite to destroy what's left of what we have.

I think scoring people by credit should be illegal.

[pitohui]

50. shitty pay is eroding the middle class

if you have a child you cannot afford to retire, and it's been that way for years

smart middle class people don't reproduce because they can do math and think about the future

dumb middle class people have kids and then wake up and realize that, oops, they don't have any legal way to earn enough money to support a decent education for the kids AND provide for their own old age

salaries are just not high enough for expenses required to live in america unless you live in a fucking tent somewhere

the credit scoring nonsense is just something that had to happen once shitty pay went on for enough decades, because people who want to feed & educate their children almost have to take on more debt than they can reasonably repay

there are not enough good jobs for good people who are qualified and bright enough to do them, so employers have to find some way to live with themselves whilst denying people a chance of any decent future

what would you do if you were an employer? i wouldn't hire me either, if i didn't know myself from the inside, if i knew me only from some pieces of paper

the rich man's child is perfect on paper and better looking too, thanks to early dental care, etc.

there are only so many 80K-plus jobs a year and almost all of them go to legacies...good jobs are found thru "networking," which means you were either born in the right circle or you were pretty enough to fuck your way into the right circle

the rest of us are out in the cold

i don't blame the credit agencies in particular

i blame shitty pay and shitty benefits