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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

#301

Post by ta1243 »

greedo wrote: post #289
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…

No more expenses... Right! No property tax. No homeowner's insurance. No maintenance. Just living on easy street.

It seems unlikely you'd be able to rent somewhere for less than the cost of

* maintenence

* taxes

* return on capital

Because otherwise your landlord is subsidising you, and why would they do that?

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

#302

Post by RankingMember »

wobfan wrote: post #167
tnel77 wrote: post #160

Earlier quoted context omitted.

True, and this is why you shouldn’t just hand your kid an iPad and peace out. I’m all for technology and video games for my kids, but I’m vigilant to keep my kids’ eyes away from ads. As a result, my kids aren’t foaming at the mouth for the latest and greatest toys and games which was my experience as a child.

Thing is, keeping children out of Instagram, Facebook, or whatever new social media is hyping currently will probably make them kind of weirdos in their bubble, e.g. in school. At least this would be my fear (don't have children). And good luck trying to use any of these ad-infested privacy-invading platforms while trying to avoid ads.

Being an outlier when the in-group is actively having their brains turned to mush seems like the better of the two outcomes.

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

#303

Post by throwaway98797 »

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…

sometimes you make money in lumps

debt allows people smooth that out and lending companies take a fee for that service

nothing evil or wrong about it

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

#304

Post by parpfish »

ch4s3 wrote: post #257
alkonaut wrote: post #251

Does anyone else live in a place where there isn't a visible "score" for how valuable you are, but rather only a "credit check" for how risky you are, which is performed if you apply for new credit (buying anything with an invoice, getting a credit card, or taking any other kind of loan)? Meaning that if you have a good income and no history of failing payments, you are basically passing the check with flying colors,…

Credit scores aren't a score of how valuable you are, they're a score of creditworthiness or how unlikely you are to default on a loan. The largest factors are age of credit and payment history. Utilization is also a factor. Someone who occasionally misses payments and has high utilization is going to be more profitable but higher risk to lend to.

Just because that’s what a scores is designed to do it doesn’t mean that’s what businesses use it for downstream.

The fact people always debate what a credit score really means suggests that there are too many factors rolled up into a single number when we should really have a few distinct sub-scales. Anybody that has made a dashboard for a ceo with a short attention span that refuses to deal with nuance and just wants to see “a number” knows this problem all too well

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

#305

Post by koakuma-chan »

op00to wrote: post #292
koakuma-chan wrote: post #212

Earlier quoted context omitted.

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.

I guess they all need those accounts for their student visas.

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

#306

Post by DiscourseFan »

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…

You forget that you don’t pay taxes on debt.

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

#307

Post by jajuuka »

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. :)

It's crazy how many things that require credit are on a self report basis. And the only time they actually report is for a past due debt and not successful payments.

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

#308

Post by 9rx »

ljm wrote: post #294
lm28469 wrote: post #91

Earlier quoted context omitted.

> 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 appli…

> Wages for the average person (working class) typically remain stagnant while cost of living increases, particularly through inflation.

If wages were stagnant, nominally, you'd be making like 25¢ per hour. Wages are stagnant[1] only in real terms (i.e. adjusted for inflation). Cost of living and inflation are very different concepts, but since you indicate that inflation is responsible for most of the cost of living increases, wages have kept pace anyway, so...

[1] Technically not even. Wages are growing faster than inflation, but the margins are small enough that we accept calling it stagnant as a close enough approximation.

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

#309

Post by bryanlarsen »

ljm wrote: post #294
lm28469 wrote: post #91

Earlier quoted context omitted.

> 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 appli…

That's not true. Wages have generally outpaced inflation as long as we've measured inflation properly. Up until the early 1970s this was very palpable, since the early 1970s the delta has been much lower, wage increases have been very slightly above inflation.

Why does it feel different? 1: the amount of stuff we buy has increased a lot. Anybody who owns what would be considered solidly middle class in the early 1970s will feel quite poor today. 2: financial security is way down.

In the early seventies a middle class family of 6 would own a 1200 square foot house, a single car, a single TV and a single radio would be the sum total of the entertainment electronics they owned, they'd have less than a dozen outfits apiece, they'd eat out about once a month, a vacation to a neighboring state would feel like a splurge, et cetera.

But they were relatively content. 1: they were much better off than their parents and grandparents, who experienced the depression & WW2. 2: they were "keeping up with the Joneses". 3: they had a feeling of financial security due to job security and the fact that serious health events were unlikely to financially devastating.

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

#310

Post by psunavy03 »

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…

OK, we'll tell the average worker who can't afford a house or a car by paying cash not to responsibly use a mortgage or a car loan, because some person on the internet said so.

And yes, I'm aware cars are depreciating assets, so spare me the lecture on financing one. I don't currently have a car loan.

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