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Equifax removed the $125 claim payout option after millions submitted claims

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Re: Equifax removed the $125 claim payout option after millions submitted claims

#351

Post by Slartie »

navigatesol wrote: post #337
Retric wrote: post #335

Earlier quoted context omitted.

Those loans can be a profit center as they make it really easy to miss a payment, and then instantly jack up the rates to ~20% APR. Think short window to make a payment and no automatic payments available. It’s probably not worth it for effectively a sub 1% discount.

> It’s probably not worth it for effectively a sub 1% discount. The discount is small, I agree. But it's always worth it. It's riskless if you have the cash anyway.

It's worth it until you miss a payment and run in the absurdly high interest rates. Which makes it not riskless, because your risk of missing a payment is non-zero, even if you think it is zero.

And regarding having cash: if you set aside the full amount in cash at time of purchase in order to reduce the risk of not being able to pay the rates, then you did win absolutely nothing. Opportunity cost of not having that cash available for profitable investments in case of paying in cash is what could possibly be the reason for the credit variant being cheaper in the end, but that of course depends on you investing the cash and divesting just when it is necessary to pay a rate.

Re: Equifax removed the $125 claim payout option after millions submitted claims

#352

Post by Kneecaps07 »

elcomet wrote: post #318
frereubu wrote: post #308

Earlier quoted context omitted.

This is a great 99% Invisible episode about how credit cards came about, and what it was like beforehand, where you would be interviewed at length by a store before being given credit to buy, for example, a piece of furniture. Credit cards were designed to outsource checking of credit-worthiness, stop intrusive interviews with stores and avoid embarrassment of being rejected in-store. Lax digital storage of informati…

Coming from Europe, it would never occur to me to buy furniture on credit, is this something common in the US ?

Yes. There are even large chains where you can rent things like furniture and TVs.

Re: Equifax removed the $125 claim payout option after millions submitted claims

#353

Post by behringer »

adrianN wrote: post #349
safgasCVS wrote: post #341

Earlier quoted context omitted.

I had the exact same thought. Making credit easier to obtain is taken as 'good' but I only see that as beneficial for something major like a house or car but the idea of going into debt for disposable items seems really weird

For low income families, furniture is something major.

Low income families need to buy furniture at the goodwill, not taking out loans for a leather sofa.

Re: Equifax removed the $125 claim payout option after millions submitted claims

#354

Post by vasco »

navigatesol wrote: post #337
Retric wrote: post #335

Earlier quoted context omitted.

Those loans can be a profit center as they make it really easy to miss a payment, and then instantly jack up the rates to ~20% APR. Think short window to make a payment and no automatic payments available. It’s probably not worth it for effectively a sub 1% discount.

> It’s probably not worth it for effectively a sub 1% discount. The discount is small, I agree. But it's always worth it. It's riskless if you have the cash anyway.

It's not always worth it. If you have to spend 1 hour to set it up initially, sign the paperwork and then an extra 15mins per month paying it, it might already be very much not worth it.

Re: Equifax removed the $125 claim payout option after millions submitted claims

#355

Post by atombender »

navigatesol wrote: post #332
elcomet wrote: post #318

Earlier quoted context omitted.

Coming from Europe, it would never occur to me to buy furniture on credit, is this something common in the US ?

> it would never occur to me to buy furniture on credit Ikea, and nearly any reasonably sized furniture store, has a financing arm. So I assume it's common (and a money maker). Thing is, often these places offer 6 months interest free and what not, so as long as you pay off your debt in the allotted time, it's smarter than paying cash.

Many places offer interest-free deferred payment. For example, Design Within Reach, through Synchrony Bank, lets you pay in equal installments over 24 months (or less, if you want) [1]. APR around 20% kicks in if you go past the time limit.

[1] https://www.mysynchrony.com/mysyf/paymentestimator.html?intc...

Re: Equifax removed the $125 claim payout option after millions submitted claims

#356

Post by vasco »

jdietrich wrote: post #327
Glawen wrote: post #304

Earlier quoted context omitted.

The UK imports all the shitty things from the US, instead of looking at what the european are doing: - No national ID, so identity theft is easier - For a long time, no pin code on credit card, so that theft is easier Basically they keep the stuff which trick the consumer, whereas in Europe they make law to protect consumer. I really hope they leave the EU and stop bothering us with their shitty ideas, credit referen…

>No national ID, so identity theft is easier We don't want national identity cards; the Blair government tried to introduce them in 2006 and failed due to massive public opposition. We think it's a bit weird that other EU nationals are so tolerant of the government having a massive centralised database tied to a single token. https://en.wikipedia.org/wiki/Identity_Cards_Act_2006 >For a long time, no pin code on credi…

You have drivers licenses and bank cards and passports already. Having a national ID just makes a bunch of stuff easier and identity theft harder.

Re: Equifax removed the $125 claim payout option after millions submitted claims

#357

Post by endorphone »

throwawaycert wrote: post #101
brazzledazzle wrote: post #97

Earlier quoted context omitted.

I’m suddenly reminded of the ratings used to fuel the subprime mortgage crisis.

That was something subtly different. The banks more or less knew they were taking poor risks, the problem is it wasn't their risk to take . They quietly packaged these bad mortgages along with others and resold the mess to less sophisticated investors (like pension plans). Then the bubble burst, the well dried up, and banks started collapsing. It wasn't a mismanagement of risk, it was criminal fraud writ large.

A bank isn't an individual who is lending his own money. It is an organization that lends other people's money and needs a veneer of justifications for the choices they make, and credit reporting agencies are a perfect choice. You mentioned earlier that banks have statistical teams making these analyses, but most simply don't because that provides counter-information that undermines the whole value of credit reporting agencies (which is that they outsource the politically fraught choices and makes it easy to say "well we just followed their ratings, just like everyone else").

Regarding the subprime crisis, the biggest victims were the largest banks -- the most sophisticated being put completely out of business -- so not sure what the bit about pension plans comes from (many of those made a lot of money on it).

Re: Equifax removed the $125 claim payout option after millions submitted claims

#358

Post by koboll »

paulgb wrote: post #116
nikolay wrote: post #35

Earlier quoted context omitted.

We should. It looks like FTC isn't on our side.

Seriously. I was especially struck by this, which sounds like it is written by Equifax PR people, but it comes from the FTC: > The free credit monitoring provides a much better value, and everyone whose information was exposed can take advantage of it. If your information was exposed in the data breach, and you file a valid claim before the deadline, you are guaranteed at least four years of free monitoring at all th…

$16 is still a lot more than we're each going to get from the $31 million. Millions of people have signed up, which means we might get a buck or two each if we're lucky.

So arguably, if you really want to stick it to Equifax, the monitoring service might be a better way to do so.

Re: Equifax removed the $125 claim payout option after millions submitted claims

#359

Post by [deleted] »

mikeash wrote: post #251
patio11 wrote: post #221

Earlier quoted context omitted.

This statement, which is currently greyed out, is an objective statement of engineering fact about one of the most important technologies introduced in the last one hundred years. I hope I have bought enough street cred to say the following by ghostwriting hundreds of letters to the credit reporting agencies to fix their problems, which are numerous and essentially inevitable given their model and present operations.…

It’s effectively for free, except for the massive society wide risk of fraud that they’ve foisted upon all of us. The stuff looks cheap because, like any polluting industry, the price does not reflect the true cost. Surely there’s some third alternative other than “incompetent credit bureaus enable fraud” and “minorities have bad access to credit because lenders are super racist”?

[deleted]

Re: Equifax removed the $125 claim payout option after millions submitted claims

#360

Post by save_ferris »

safgasCVS wrote: post #341
elcomet wrote: post #318

Earlier quoted context omitted.

Coming from Europe, it would never occur to me to buy furniture on credit, is this something common in the US ?

I had the exact same thought. Making credit easier to obtain is taken as 'good' but I only see that as beneficial for something major like a house or car but the idea of going into debt for disposable items seems really weird

Unfortunately, it’s deeply ingrained in US culture to rely too much on credit. It’s just one of many barriers that separates the wealthy from the poor.

Payday lenders don’t have limits on the amount of interest that they can charge for a given payday loan. Worse yet, loan applicants don’t have to demonstrate ability to pay the loan during the application process.

Legislation was recently passed to require payday lenders to loan only to those who could demonstrate ability to pay, but this was recently reversed after intense lobbying by the payday lenders.

Credit access is vastly predatory in the US, and feeds into our consumerist culture that believes in nice phones, watches, cars, whatever, and has created generations of debt slaves owing interest in excess of 20-30% that they’ll likely never be able to repay.

A former coworker once said to me: “those who understand compound interest earn it, and those who don’t understand compound interest pay it.” And generally, I’ve found this to be very true.

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