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I'm not so sure the credit scoring system it's self is unfair, the one I use always seems keen to help + have added a note to my file explaining what's been going on. It's fair to say that after the credit crunch that the average Joe's report has taken a pounding, my report went from having a good rating to very poor over night. I think the problem lies at the creditors door step, many creditors seem quick to add late payment points (even when you make a prior arrangement) but when you make a massive effort top pay it off they don't seem keen to alter the record to reflect that. I would suspect this is engineered in some way so in the near future when you do need finance for a car or something important in the house ie. a new boiler they will grant you a loan at top APR's. I would say to any one having issues with there file then contact the company in question & see what they can advise & also contact anyone you have finances with & state your case, if it's genuine then it's a fair bet they may remove the default.
Well the Op is going to be happy with what is coming. Much more than crdit score but actual debt to income being added as a important factor. You can pay everyhtign on time but have to much debt for your income in the new consumer protection laws and they will protect you from yourself.Check with nay auto dealer to se just how tight credit scores are on those deals 'for well qaulified Buyers". They have to lineup credit at higher rates for those that don't pass and the numbers are getting higher and higher.That is really how consumer protection works.
Of course I don't expect what you said about handing out money, even though it would be nice. The point I was making is it seems the system is set up to make more people have poor credit than it is to have it the other way around.
The system doesn't make people have poor credit. The system warns those who might loan them money that they might not pay it back.
I thnik that those using the credit score actaully allow for the errors .That is why they bascially say above a certain score. 25-50 points is goig to hurt you much unless its borderline to start with. There is no perfect system when dealig with numbers and humans.That is why lide isn;t fair and needs to be paid attention to to control it for your best interest.
There's a HUGE difference between a 620 and a 670, as far as how much interest you're going to pay. Or a 670 vs 720. You don't have to be borderline to be affected by 50 points. And to intentionally not report your good credit to keep your score lower? That's just wrong.
Get away with what? The credit card companies didn't create the system. The system was developed by the Fair Isaac and wasn't created out of thin-air. The number indicates your credit worthiness and your likelihood of default, many real world statistics have been used to develop the algorithm. Also they do not treat a score of 610 the same as 510.
So what do you want, should the credit card companies just hand out money to anybody at low rates? Would you loan money to someone you know is having trouble paying back what they currently owe? But some people screw up, but its usually because bad life planning. Regardless, why do you expect a company to pay for your mistakes?
Let's say Bob has a credit score of 550 and Tom has a credit score of 650. Now let's say Bob discovers a major error on his credit report, has this error corrected, and suddenly his credit score jumps to 700.
Did Bob suddenly become a much lower credit risk, and a lower risk than Tom?
Let's say Jim lost his job and his income, so he was unable to pay his bills and his credit score plunged from 750 to 600 and eventually to 500. Let's also say that Bill used to be in Jim's shoes but finally found a job and Bill's credit score has gone up from 500 to 600 and eventually to 750.
Does Jim's 600 reflect credit risk equal toi Bill's 600?
People of their own free will voluntarily forfeited their right to pay their hospital or doctor directly and negotiate payment plans with their hospital or doctor that would not adversely affect their credit when they made the brilliant decision to pay insurance companies thousands of dollars each year for the privilege of forfeiting their right to pay their hospital or doctor directly and negotiate payment plans directly with their hospital or doctor.
What should an uninsured burger flipper do? There is no possibility that a $100K payment plan would be workable or sustainable. Should they just die?
Of course, I can hear the conservatives say, manage your own credit properly and you won't have this problem.
Well, it is not always that easy, again, always, that easy.
Yes, it is.
And, if you hit hard times, you do get a chance to improve. It's not carved on your forehead forever.
Geezus, just pay cash and be done with it. If your credit is that bad, it's a sign you shouldn't be using credit in the first place.
I got slammed by one creditor with exorbitant fees because I was one day late paying another creditor. So I ended up have 3-4k applied to the higher interest rate. In other words they changed the interest rate, which is what they can do, especially if you have a low rate.
And it's like a self-fulfilling prophecy. A reduced credit score means worse terms (higher interest rates over a longer period of time) which GUARANTEES a higher rate of delinquency and default.
It's like they are setting you up for failure and charging you for the privilege.
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