Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

How Equifax Became a Private IRS

mattstoller.substack.com

Post reply on HN
Print view View original

11–20 of 190 posts

Re: How Equifax Became a Private IRS

#11

Post by mattnewton »

BuyMyBitcoins wrote: post #10
radicaldreamer wrote: post #7

Earlier quoted context omitted.

Those are not the only rules though... you can have low credit for not taking out enough loans and not having debt. You get dinged for opening and closing credit card accounts too quickly, even if you've never missed a payment. Your score goes down if you simply inquire about loans a bit too often... All of these are "rules" made up unilaterally by the credit bureaus.

I have a few credit cards that I no longer use. If I cancel them my score would go down because the average age/length credit history would go down. Not by that much, but it is surprising that leaving these cards open is incentivized whereas the more secure and less risky thing to do would be to close those accounts.

It make a a bit more sense when you think about it - Risk isn’t really the main thing incentivized here, making interest payments is haha. Risky lenders don’t make payments, but neither do people who never take on debt

Re: How Equifax Became a Private IRS

#12

Post by [deleted] »

radicaldreamer wrote: post #7
xxpor wrote: post #4

Earlier quoted context omitted.

I see where you're coming from, but on the other hand, the biggest rules are well known and quite simple: If you take a loan and pay it back on time, you'll have high credit. If you fail to meet your obligations, you won't. The existence of an underclass which is constantly on the edge of not being able to pay their bills is true though.

Those are not the only rules though... you can have low credit for not taking out enough loans and not having debt. You get dinged for opening and closing credit card accounts too quickly, even if you've never missed a payment. Your score goes down if you simply inquire about loans a bit too often... All of these are "rules" made up unilaterally by the credit bureaus.

[deleted]

Re: How Equifax Became a Private IRS

#13

Post by MerelyMortal »

mbg721 wrote: post #8
nimbius wrote: post #2

A cogent argument could.be made that transunion, Equifax, and other big private credit clearinghouses act as direct agents of an unspoken american "social credit" system in which the credit score denies housing and employment to those who refuse to or cannot conform to a largely invisible tome of rules. These agents are then unpoliced as they serve capitalisms direct need for an underclass. Full disclosure: I am a co…

It seems weird not to name Experian. Aren't there only three?

There are a bunch of other types of reporting agencies too, not just for credit:

https://www.consumerlawfirm.com/credit-reporting-agencies.ht...

https://www.consumerfinance.gov/consumer-tools/credit-report...

Re: How Equifax Became a Private IRS

#14

Post by refurb »

nimbius wrote: post #2

A cogent argument could.be made that transunion, Equifax, and other big private credit clearinghouses act as direct agents of an unspoken american "social credit" system in which the credit score denies housing and employment to those who refuse to or cannot conform to a largely invisible tome of rules. These agents are then unpoliced as they serve capitalisms direct need for an underclass. Full disclosure: I am a co…

If “paying you debts” is an “invisible tome of rules” then I’m all for it.

Let’s be honest, credit score pretty accurately reflect what they are supposed to measure - credit worthiness.

Re: How Equifax Became a Private IRS

#15

Post by seanmcdirmid »

radicaldreamer wrote: post #7
xxpor wrote: post #4

Earlier quoted context omitted.

I see where you're coming from, but on the other hand, the biggest rules are well known and quite simple: If you take a loan and pay it back on time, you'll have high credit. If you fail to meet your obligations, you won't. The existence of an underclass which is constantly on the edge of not being able to pay their bills is true though.

Those are not the only rules though... you can have low credit for not taking out enough loans and not having debt. You get dinged for opening and closing credit card accounts too quickly, even if you've never missed a payment. Your score goes down if you simply inquire about loans a bit too often... All of these are "rules" made up unilaterally by the credit bureaus.

Those are minor and often temporary dings compared to not paying back loans on time or at all. For example, if you don’t have a loan history, your score isn’t low enough that you can’t get an apartment or get a car loan. Then by doing those things you can build credit. The other things, open and closing accounts too quickly, or making lots of loan inquiries over a short period of time, lead to temporary dings that recover in a few months (they just throttle your credit). The rules are not explicit enough I agree, but it’s not like most of them couldn’t be covered in a high school financial literacy class.

Almost everyone significantly disenfranchised by bad credit are actually for things that would obviously lead to bad credit (to their fault or not; i.e. identity theft could be involved).

Re: How Equifax Became a Private IRS

#16

Post by jessaustin »

nimbius wrote: post #2

A cogent argument could.be made that transunion, Equifax, and other big private credit clearinghouses act as direct agents of an unspoken american "social credit" system in which the credit score denies housing and employment to those who refuse to or cannot conform to a largely invisible tome of rules. These agents are then unpoliced as they serve capitalisms direct need for an underclass. Full disclosure: I am a co…

Even in our most dystopian RAND-suggested bedtime story vision of a "communist hellhole", those proles who happened to possess a ruble when they got to the front of the breadline could buy a loaf. In the supercapitalist future, all transactions will require the approval of more than the two involved parties. Good luck buying anything if you ever express skepticism toward the great and powerful credit bureaus.

Re: How Equifax Became a Private IRS

#17

Post by corytheboyd »

refurb wrote: post #14
nimbius wrote: post #2

A cogent argument could.be made that transunion, Equifax, and other big private credit clearinghouses act as direct agents of an unspoken american "social credit" system in which the credit score denies housing and employment to those who refuse to or cannot conform to a largely invisible tome of rules. These agents are then unpoliced as they serve capitalisms direct need for an underclass. Full disclosure: I am a co…

If “paying you debts” is an “invisible tome of rules” then I’m all for it. Let’s be honest, credit score pretty accurately reflect what they are supposed to measure - credit worthiness.

I would not loan someone thousands of dollars on a "trust me bro", so I wouldn't expect banks to either. Corruption of the authority judging trustworthiness is bad, but there just needs to be an authority doing this.

The real problem is more likely that wages and living expenses are not in sync, which just fucks over the poor people. Using credit to avoid literally dying on the street is more a symptom of wages making no sense.

It's sad. I don't like it either. I don't trust these people either. Equifax fucked me and millions of others, and I got a check for $5.21. There is no justice and there never will be.

Re: How Equifax Became a Private IRS

#18

Post by epgui »

xxpor wrote: post #4
nimbius wrote: post #2

A cogent argument could.be made that transunion, Equifax, and other big private credit clearinghouses act as direct agents of an unspoken american "social credit" system in which the credit score denies housing and employment to those who refuse to or cannot conform to a largely invisible tome of rules. These agents are then unpoliced as they serve capitalisms direct need for an underclass. Full disclosure: I am a co…

I see where you're coming from, but on the other hand, the biggest rules are well known and quite simple: If you take a loan and pay it back on time, you'll have high credit. If you fail to meet your obligations, you won't. The existence of an underclass which is constantly on the edge of not being able to pay their bills is true though.

On the contrary, the actual rules and methodologies for credit score calculations are not documented anywhere public.

Saying essentially "just don't do bad things to your reputation" is at most a very hand wavy "rule of thumb", but it's not a codified "rule" of the sort we should expect to see of such a consequential system.

Re: How Equifax Became a Private IRS

#19

Post by 33955985 »

refurb wrote: post #14
nimbius wrote: post #2

A cogent argument could.be made that transunion, Equifax, and other big private credit clearinghouses act as direct agents of an unspoken american "social credit" system in which the credit score denies housing and employment to those who refuse to or cannot conform to a largely invisible tome of rules. These agents are then unpoliced as they serve capitalisms direct need for an underclass. Full disclosure: I am a co…

If “paying you debts” is an “invisible tome of rules” then I’m all for it. Let’s be honest, credit score pretty accurately reflect what they are supposed to measure - credit worthiness.

A reasonable take if you ignore how this system reinforces existing inequality + the ways this system is used outside its original scope.

Also you have to admit it’s kind of fucked up that there’s no total opt out mechanism.

Re: How Equifax Became a Private IRS

#20

Post by epgui »

refurb wrote: post #14
nimbius wrote: post #2

A cogent argument could.be made that transunion, Equifax, and other big private credit clearinghouses act as direct agents of an unspoken american "social credit" system in which the credit score denies housing and employment to those who refuse to or cannot conform to a largely invisible tome of rules. These agents are then unpoliced as they serve capitalisms direct need for an underclass. Full disclosure: I am a co…

If “paying you debts” is an “invisible tome of rules” then I’m all for it. Let’s be honest, credit score pretty accurately reflect what they are supposed to measure - credit worthiness.

> credit score pretty accurately reflect what they are supposed to measure - credit worthiness

Do they?

If that was true, how could we verify it, beyond an initial gut feeling? There is no published rule book or methodology for credit score calculations!

Post reply on HN