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The careless errors of credit reporting agencies

washingtonpost.com

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Re: The careless errors of credit reporting agencies

#191

Post by FireBeyond »

superuser2 wrote: post #101
ThomPete wrote: post #83

The US is as far as I know the only country in the world who have a positive creditscore system. At least in Europe it's mostly based on a negative creditscore i.e. you are trusted by definition but if you don't pay your bills you end up not being allowed access to credit. In the US they don't trust you per definition and instead you have to prove that you are good with money by basically creating debt and then payin…

>you are trusted by definition I felt pretty "trusted by definition." Citi gave me a credit card with a $3,000 limit as a college freshmen. A few years later I had an $8,000 limit card and a $10,000 limit card. I bought my car certified-pre-owned under a program that writes favorable low-cost loans to recent college graduates with no or limited credit history (with an offer letter or paystubs). You just aren't truste…

"I felt pretty "trusted by definition." Citi gave me a credit card with a $3,000 limit as a college freshmen. A few years later I had an $8,000 limit card and a $10,000 limit card."

As a recent immigrant I felt pretty untrusted. In my late 20s, despite being able to show a year of income in the six digits, no overdrafts, I had to go to four separate banks before finding one that was willing to give me a $300 limit card.

Re: The careless errors of credit reporting agencies

#192

Post by loeg »

diggernet wrote: post #154
loeg wrote: post #30

Earlier quoted context omitted.

> How much is this connected to not having a real id card? Social security number is sort of that. But various businesses keep accepting it blindly from fraudsters ("identity thieves"). So for now it remains semi-private because it is overused for authentication. > Another concept that I don't understand is that USA's social security number has to be kept secret or otherwise your identity can be stolen. How that is e…

... and not even necessarily unique.

It is certainly intended to be unique.

Re: The careless errors of credit reporting agencies

#193

Post by loeg »

ourmandave wrote: post #54
loeg wrote: post #26

Earlier quoted context omitted.

I have also never had much luck with the annual report site.

Last time I tried I couldn't get past the question with the list, "Which of these phone numbers have you had in the past? (check all that apply)" I've had a lot of numbers in the past because my daughter's phone was in my name, or I changed carriers and my number wouldn't transfer.

Yes. I too "failed" the public information database of my history. :-/

Re: The careless errors of credit reporting agencies

#194

Post by Broken_Hippo »

scdoshi wrote: post #175
superuser2 wrote: post #128

Earlier quoted context omitted.

Being an authorized user on a parent's credit card does build credit history for the child. I did not have that, or any cosigned loan.

But it's also true that if you come to the US during or after college, banks will not issue you a credit card. Instead, they will issue you a 'secured' credit card, where you get a $300-500 limit on a card against the same amount paid to the bank as security. Only after a year or 2 of this, will the bank actually issue credit. Maybe you had an account/history with the bank for a while, and that made a difference?

That isn't just immigrants: Plenty of young, non-college bound students have only access to such cards. Americans also use them after bankruptcy to try to help strengthen their credit scores.

Re: The careless errors of credit reporting agencies

#195

Post by FireBeyond »

saryant wrote: post #176
ThomPete wrote: post #172

Earlier quoted context omitted.

Yet thats exactly what I had to do. I had to basically fund my own credit for some time and pay it off. All which cost money of course. As a foreigner thats how it's normally done. At least in a bank like Citibank.

You can open a secured credit card, never use it and after a year convert it to an unsecured credit card, getting your deposit back. And you would never have been in debt.

That's not quite accurate, almost any secured or subprime credit card will have activity requirements. Most will close your account if there's insufficient transactions in the last three months.

Re: The careless errors of credit reporting agencies

#196

Post by scott00 »

popmystack wrote: post #155
superuser2 wrote: post #101

Earlier quoted context omitted.

>you are trusted by definition I felt pretty "trusted by definition." Citi gave me a credit card with a $3,000 limit as a college freshmen. A few years later I had an $8,000 limit card and a $10,000 limit card. I bought my car certified-pre-owned under a program that writes favorable low-cost loans to recent college graduates with no or limited credit history (with an offer letter or paystubs). You just aren't truste…

>Citi gave me a credit card with a $3,000 limit as a college freshmen. How old are you? Just a few years ago, despite making a very decent amount of money and having no marks on my credit, it took an entire year for me to get a credit card. Reason: lack of credit history. A lot of people have similar stories. >This depends on your definitions a little bit. The part where you spend money that isn't yours and then pay…

> How old are you? Just a few years ago, despite making a very decent amount of money and having no marks on my credit, it took an entire year for me to get a credit card. Reason: lack of credit history. A lot of people have similar stories.

I don't really understand why, but it's way easier to get a credit card with no history if you are in college. People who would easily be approved as a senior in college will get denied 12 months later. It's stupid that it works this way, but some of the best financial advice you can give a college student is "get a credit card before you graduate."

> 4. Prevent employers from pulling credit history. Your finances are not their business.

This resonates intuitively with a lot of people (myself included), and is actually the law in 11 states. There are some interesting subtleties that should be considered before making up your mind though. In brief, the practical impact can make things _worse_ for some demographics often assumed to benefit from this type of legislation. A mass market article: https://www.washingtonpost.com/news/wonk/wp/2016/03/23/the-l...

The original research: http://scholar.harvard.edu/files/shoag/files/no_more_credit_...

> 5. Prevent landlords from pulling credit history. They are not loaning you money.

If all goes well, they aren't loaning you money. However, in most states it takes at least a couple of months to lawfully evict a non-paying tenant. So landlords are implicitly offering to loan tenants a few months rent.

Re: The careless errors of credit reporting agencies

#197

Post by Broken_Hippo »

ThomPete wrote: post #182
SystemOut wrote: post #115

Earlier quoted context omitted.

How do my parent's credit history have anything to do with my credit history in the US? Are you talking about co-signing for loans or possibly how a child can get a card under their parents' name? I didn't think either of those had any impact on the child's credit score.

You and your parents history in the US in general can have a an affect on whether you can convince a bank to give you a credit card or not not on the credit score. I am not talking about credit card history but about history of being a US citizen, having a bank account etc. I think a lot here are missing the point. The question is not about your credit score but about getting the credit card to begin with. Once you g…

Ok, here is the thing. Your parents credit score doesn't affect yours. At all. IT doesn't help you get a credit card, nor bank accounts.

Unless: Someone has them cosign for a loan or credit card. This is somewhat common with a first car loan or some student loans, but less common with credit cards. They won't be able to do that if they have a low score.

Otherwise, you are basically on your own. The credit stuff you would have experienced coming here is what many 18-year olds hav to deal with. Some older women find themselves in a similar position - the accounts were all in their husband's name.

Re: The careless errors of credit reporting agencies

#198

Post by brassic »

tedunangst wrote: post #152
graeme wrote: post #35

Earlier quoted context omitted.

Isn't it libel to spread incorrect information about others, that is damaging, and that is certified as a true belief?

Only if you know the information is false.

Or if you show a reckless disregard for the truth.

Re: The careless errors of credit reporting agencies

#199

Post by tacostakohashi »

Drdrdrq wrote: post #159
ArkyBeagle wrote: post #140

Earlier quoted context omitted.

They don't care if you're "good with money". They care that you can demonstrate a habit of making payments on time.

This. It is also the reason the system seems weird to me - their incentive is not same as mine as a customer.

It's pretty normal for opposing incentives to exist between customers and providers (counterparties).

Re: The careless errors of credit reporting agencies

#200

Post by tacostakohashi »

apatters wrote: post #158
bsbechtel wrote: post #99

Earlier quoted context omitted.

So do you have a suggestion for a system that works better, or do you prefer banks lend the money from your savings account without any sort of evaluation of how likely it is to be paid back?

The banks have a profit motive for assessing credit risk accurately. They are the ones who make money if this is done right. So why don't the banks pay for it? Why are we subsidizing the banks' business model by paying for credit reports at all? I don't have to pay if I want to receive more than one bank account statement per year, and bank accounts are another product the bank uses to make money off of me, just like…

You also have a profit motive for having your credit risk assessed accurately - you get credit, at a better interest rate.

The banks do pay for it - they have to pay a fee do get your credit report.

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