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FICO to incorporate buy-now-pay-later loans into credit scores

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Re: FICO to incorporate buy-now-pay-later loans into credit scores

#291

Post by JKCalhoun »

scarface_74 wrote: post #85
crazygringo wrote: post #80

Earlier quoted context omitted.

No. You can rent and you can take the bus. Or rent and buy a crazy cheap old used car. A house and a decent car are not primarily about making money. They're about your quality of life. > And all recommend not using credit cards and instead an emergency fund if you lose your job. And if you already used your emergency fund on, say, a medical emergency...?

Yes because American public transit is so great and now you have to get up hours earlier and come home later - not great if you have kids or you actually want to spend time with your significant other. Also what happens when that cheap old car doesn’t start in the morning when you need to get to work or pick your kids up from day care/school or need to be home when they get off the bus? Where are you going to get the…

You present some very daunting problems that the young and working class have to deal with (I know, I was both of those decades ago and struggled myself).

Credit to buy a new car though is still generally a bad solution. We should fix the other things you mentioned.

I would like to see laws allowing extreme low-cost vehicles (equivalent to golf carts, I guess) allowed on designated roads. A special inexpensive insurance proviso for them.

That you need something like $30K to buy a new car in the U.S. is insane.

Re: FICO to incorporate buy-now-pay-later loans into credit scores

#292

Post by op00to »

koakuma-chan wrote: post #212
suddenlybananas wrote: post #192

Earlier quoted context omitted.

Yeah who cares about society?

How do you propose to at least get society off TikTok or Instagram? You will only face backlash if you try to utter in that direction.

I’ve never had anyone say anything other than “yes, that seems like a good idea, I wish I could do that” when i tell them I do not have a TikTok, instagram, twitter, facebook, etc account.

Re: FICO to incorporate buy-now-pay-later loans into credit scores

#293

Post by JKCalhoun »

lupusreal wrote: post #96
crazygringo wrote: post #80

Earlier quoted context omitted.

No. You can rent and you can take the bus. Or rent and buy a crazy cheap old used car. A house and a decent car are not primarily about making money. They're about your quality of life. > And all recommend not using credit cards and instead an emergency fund if you lose your job. And if you already used your emergency fund on, say, a medical emergency...?

Lol what bus?

My daughter went a year to and from work by bus in Omaha. Yeah, it sucked. But we should instead be trying to fix that rather than just tell people "Let them eat credit."

Re: FICO to incorporate buy-now-pay-later loans into credit scores

#294

Post by ljm »

lm28469 wrote: post #91
PostOnce wrote: post #13

Theoretically, credit should be used for one thing: to make more money. (not less) However, instead of using it to buy or construct a machine to triple what you can produce in an hour, the average person is using it to delay having to work that hour at all, in exchange for having to work an hour and six minutes sometime later. At some point, you run out of hours available and the house of cards collapses. i.e., credi…

> the average person is using The "average person" is told from birth to consume as many things and experiences as possible as it if was the only thing that could give their life a meaning. The entire system is based on growth and consumption, I have a hard time blaming "the average person"

Wages for the average person (working class) typically remain stagnant while cost of living increases, particularly through inflation. I imagine minimum wage would be 25-30 bucks an hour if it did track inflation and that would only serve to keep your purchasing power constant.

Credit, in this sense, is also used to solve a cash flow problem. It’s a bad sign when that credit (or Klarna Pay-in-3 style setups) is applied to basic day to day expenses like buying groceries or other necessities.

Basically the market’s answer to increasing poverty: you’re not getting paid more, so how about we give you a payment plan to spread things out?

Re: FICO to incorporate buy-now-pay-later loans into credit scores

#295

Post by barchar »

lan321 wrote: post #223
Arainach wrote: post #42

Earlier quoted context omitted.

When everything around suggests that the system is rigged against you and care against you, it's no surprise that many people live for the moment and try to find some small bit of pleasure or joy in the moment without planning for a future that may not come. It's easy to say "why don't they save more?" from an upper or middle class stability, but when the price of everything keeps going up, the police are out to get…

This is a bit too romantic imo. From my eyes, it's mostly: "An old AMG at 20 is better than a new Ferrari at 60." There's a slider for how well you want to live your early vs late life. If you work hard, you'll be better off later, and if you go crazy early on, you'll be worse off later. However, there is a point in that you can't catch up on 20-year-old sex, getting drunk or drugged up out of your mind or general fu…

There is a ceiling on how much you can spend on these things. Generally it is not fun to get drunk or high that frequently, and in the limit you die.

Re: FICO to incorporate buy-now-pay-later loans into credit scores

#296

Post by charles_f »

For the line to go up you need people to keep buying more, and reducing costs. But when these costs are people's salary, you end up paying them less, so they can't buy more, thus credit.

The overreliance on credit as a new step in the consumption cycle is an indicator that the whole system is collapsing, but somehow it's supposed to be good news that buying a burrito might be used against you to further drawn you down.

The town is on fire but good news, your house being burned down will get you air-miles.

Re: FICO to incorporate buy-now-pay-later loans into credit scores

#297

Post by ta1243 »

lesuorac wrote: post #249
ta1243 wrote: post #239

Earlier quoted context omitted.

If you buy a house for 500k on a 5% mortgage over 25 years when you are 25, and you plan to live until you are 85, you will live there for 60 years. It will cost you 35k a year for 25 years, or 875k a year After 25 years you have no more expenses. If instead you rent it for 20k a year, increasing with 2% inflation each year, by year 25 you're paying 33k a year in rent, and by year 60 you're paying 66k a year. Over 60…

> You'd have to invest the savings and get way higher than inflation returns to break even. You say that like it's a difficult thing to do. S&P500 is up 710% since 1996. Gold is up 92% since 2012. Personally, the rent control is the best part of a mortgage and even though renting is typically better, I'm fine paying a premium for that. That said, good luck getting somebody to loan you 900k so you can play the stock m…

> Gold is up 92% since 2012.

And housing is up 125% since 2012, so the sucker who bought gold instead of a house has lost out.

We can all be rich in hindsight.

(There's also other benefits to owning - like being able to have pets, not being able to be evicted, etc)

But the biggest tell that housing is valuable is that nobody is spending $500k on housing to rent it out if they could make more money pumping $500k into the stock market.

Re: FICO to incorporate buy-now-pay-later loans into credit scores

#298

Post by Quinner »

Yizahi wrote: post #123

They didn't before? It's a credit like any other type, increasing debt burden like any credit. Seems like corru... ahem, lobbying of course. :)

There's no lobbying necessary, because FICO isn't a government agency, its a private company. Why we have a private company determining such an important thing with minimal government oversight is certainly a question we could be asking.

That being said, there's an innocent explanation for this specifically. BYPL is pretty new as a common type of debt (became popular in the last five years). They're putting it into FICO 10. The last time they updated FICO was FICO 9 which was released in 2014, before that there was FICO 8 in 2008... a lot of banks are still using FICO 8 or even earlier models. Banks are slow to change, and FICO moves slowly because banks don't want their models upended every year. Fwiw if the government was more involved in this I doubt it would be taken into account any faster.

Re: FICO to incorporate buy-now-pay-later loans into credit scores

#299

Post by scarface_74 »

JKCalhoun wrote: post #291
scarface_74 wrote: post #85

Earlier quoted context omitted.

Yes because American public transit is so great and now you have to get up hours earlier and come home later - not great if you have kids or you actually want to spend time with your significant other. Also what happens when that cheap old car doesn’t start in the morning when you need to get to work or pick your kids up from day care/school or need to be home when they get off the bus? Where are you going to get the…

You present some very daunting problems that the young and working class have to deal with (I know, I was both of those decades ago and struggled myself). Credit to buy a new car though is still generally a bad solution. We should fix the other things you mentioned. I would like to see laws allowing extreme low-cost vehicles (equivalent to golf carts, I guess) allowed on designated roads. A special inexpensive insura…

How are you going to safely have a golf cart on a highway? And what good is a car that can’t get you everywhere you need to go?

Re: FICO to incorporate buy-now-pay-later loans into credit scores

#300

Post by RankingMember »

beowulfey wrote: post #270
john01dav wrote: post #95

Earlier quoted context omitted.

I acknowledge that such telling exists, but there is still responsibility for people choosing to listen to it. Skepticism is vital. Beyond being skeptical of what you see, it is wild to me that we don't have approximately everyone blocking all ads, cable news, most social feeds, and other such transparently manipulative shit. Advertisement especially is literally industrialized and research-based psychological manipu…

People aren't going to learn to be skeptical or think critically because we've been literally removing that from the curriculum in schools. How can someone be skeptical of something if they don't even know how to be skeptical? Social media runs rampant with a form of skepticism, but I would call that closer to paranoia than critical thinking, and I don't think it's really being helpful in the same way.

I see this as directly correlated with the gradual denigration of liberal arts education, a core tenet of which is critical thinking.
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