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What if college graduates with low credit scores are less likely than high school graduates with low credit scores to be involved in accidents and make claims? Should I be have to pay a higher premium because insurers are too lazy to property underwrite insurance?
The actuarial sciences know that people generally become less accident prone as they age. The credit score is only one of the markers that determines the premium. Claims made is over a 3 year ( varies by state) period, regardless of fault, determines who is qualified for further consideration for preferrential rates.
As an aside, it's easy enough for a college student to begin to establish credit. Banks routinely market credit cards on school campuses. Some kids use this as an opportunity to establish their credit and some kids max out their cards and default.
I am unaware that any lender was forced to do no doc loans.
The GSEs (Fannie, Freddie, etc.) expected lenders to accept impaired credit, higher debt ratios, and creative definitions of income and approve loans for such in the name of reaching "affordable housing" goals. Read the Fannie Mae Foundation pdf I linked earlier, and what Fannie Mae's former chief credit officer has to say about it in my last post.
Has nothing to do with paying cash. I've done the math and have calculated I can afford only a tiny house on a tiny piece of land, but nobody is allowed to sell me a home I can afford.
Just like you people in 1% land use zoning regs to keep out the masses, the other 99% use zoning to keep the poor from buying homes they can afford.
The solution to affordable home ownership is not the failed liberal solution of forcing lenders to make high risk loans. The solution is to allow the private sector the economic liberty to sell homes people can actually afford to buy.
Your issue with your very local zoning laws is well known on this forum.
No, the government forced lenders to make high-risk loans to low-income borrowers to buy housing at all. They never should have qualified for those loans.
I live more frugally than most low-income people, but I should be denied a loan to buy a tiny home because those other low-income people mismanage their money?
Your issue is a local zoning issue and has nothing to do with your credit score. Why not pursue a variance with your local municipality. You have nothing to lose.
What irks me about credit scores is when they are used by businesses where credit is not really an issue.
For example, did you know insurer's use your credit score to determine whether or not they will issue you a policy and at what price? Insurance is not bought on credit- if you don't pay, the policy is cancelled.
That is a metric by which they determine your general responsibility as an individual. It is a great way to determine whether or not you should vouch for that motorist, as their insurer, or not.
Yep. In 1994, Countrywide became the first lender to sign an agreement with HUD to provide affordable mortgages patterned on national GSE–FHA affordable home program lending standards, which were the acceptance of impaired credit, higher debt ratios, and creative definitions of income for loan approval.
Originally Posted by Workin_Hard
Obviously the only fair thing to do is to take credit-worthiness points from those who have earned it and give those points to the bottom 47% who have not earned any at all. Recent arrivals (from the Southern lands) will be provided with points as they are shown the path to credit nirvana. After all, they're just here for a better credit score.
All part of the plan to make it fair!
Actually they already did the fair thing only they didn't give the points instead they just devalued the score of responsible people by easing the terms so much that the 47% didn't have to show responsibility and could still get a mortgage.
The responsible people already shared with the 47%ers and 2008 is a example of how bad that worked out. Dems (including Obama) and when Bush warned them of the coming crash they ignored him.
The housing crash was brought on by sharing with irresponsible people and sharing what was not earned and is a sign of things to come.
So, my question is, for those who think credit scores are in some way "racist": what alternative do you propose?
Credit scores would seem to be the least prejudicial way to determine the risk of doing business with an individual, as scores are based upon proven financial history, or lack thereof.
Should minorities be offered immunity from previous poor credit histories? Should they be spotted a bonus +150 pts?
When will people stop using the level of melanin in their skin as a personal handicap?
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