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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

#581

Post by loeg »

quickthrowman wrote: post #443
loeg wrote: post #11

Earlier quoted context omitted.

Plenty of people with good credit use BNPL loans; they are offered on much higher cost items than $80.

1.5% back on the purchase via CC rewards beats earning 1% over 3 months (4% yield) in a HYSA every time, anyone using BNPL is using them suboptimally. For a 3 month BNPL loan to be worth it, HYSA rates must be over 6%, and actually a bit more due to the time value of money; you get CC reward cash after the statement period but it takes 90 days (and up to ~120 days) to get three monthly interest payments.

Maybe you replied in the wrong place? This isn't responsive to my comment.

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

#582

Post by nailer »

I honestly have no idea whether buy now pay later is considered good or bad. The article is email-walled so I don’t know.

I was fiscally responsible and didn’t buy things on credit. I had a low credit score.

Now I deliberately pat for things on credit then pay them off immediately to have a high credit score.

Maybe we could replace credit score with an actual measure of financial responsibility?

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

#583

Post by corford »

bryanlarsen wrote: post #503
johnnyanmac wrote: post #461

Earlier quoted context omitted.

Yes, so why are we ignoring that housing is multiple times more expensive? Even with 5 times the luxury expenses, you're not going to end up cheaper than boomers who paid $1000 on a mortgage in a high COL area. Telling people to penny pinch on buying Netflix subscriptions while rent is 70% of their budget is just political theater at this point.

Rent per square foot per person as a fraction of income has been relatively constant. Rent has gone from 13% of income in 1970 to 30% of income today, but average house size has doubled and average family size has halved.

Renting is not owning (no benefits accrue from asset appreciation). The same calc for ownership is very different. Also would love to know % of population in 1970 that rented versus today. My guess is it's much higher today.

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

#584

Post by WalterBright »

chasd00 wrote: post #545
WalterBright wrote: post #435

Earlier quoted context omitted.

> It will cost you 35k a year > If instead you rent it for 20k a year Some good numbers, but what is missing is the result of investing $35k-$20k=$15k per year. Let's say you earn a %7 real return on $15k/year invested for 60-25=35 years. Writing a little program: import core.stdc.stdio; void main() { double d = 0; foreach (i; 0..35) d = (d+15000)*1.07; printf("d: $%f\n", d); } Yields $2,218,701 I would think twice a…

Can’t argue with the math but one thing about a mortgage is it takes no effort. Just pay the bill and time does the rest. With stock investment there’s an emotional attachment to every major swing, should you buy or should you sell is never far from your thoughts. Using a home as an investment may not make the most return but it’s easy as long as you can pay the bill.

Real estate prices swing around, wax and wane, just like the stock market does. It's just that there is no real estate price ticker.

Investing in the S&P 500 is even less effort. The last time I bought a house, I had to carefully read and sign about 50 pages of legal papers. Buying stocks is just pushing a button.

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

#585

Post by philipallstar »

olddustytrail wrote: post #551
bigstrat2003 wrote: post #456

Earlier quoted context omitted.

> There's definitely some loss of trust in institutions, but if it weren't for RFK, I would still trust them more than some random skeptic covid. Now, I don't trust the FDA anymore, how ironic. I stopped trusting the institutions the moment that the CDC admitted that they lied to people about "masks aren't effective" in an effort to preserve supplies for hospitals. Even if their motivation was good, that doesn't matt…

I would find that a little more convincing if the people complaining about being lied to about the efficacy of masks were also the people who were afterwards arguing most strongly in favour of masks. Strangely, it appears to be the opposite.

That doesn't seem that strange. If they can't trust an institution, people stop trusting lots of things.

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

#586

Post by bluefirebrand »

hansvm wrote: post #278
devmor wrote: post #255

Earlier quoted context omitted.

Or you end up with the opposite end of the problem. I grew up in destitute poverty and was told all my childhood that credit was an evil trap - I should absolutely never use it. Well, spring forward to me starting a pretty good career as a software developer and wanting to get my first reliable car. I had no credit history and ended up with a 19% APR. That really, really sucked. It's been 10 years since then and I st…

Why'd that suck so much? As a software dev couldn't you just pay it off a month or two later?

I dunno about you but my first car was when I was 16 working at Tim Hortons for minimum wage, long before I had a software developer salary...

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

#587

Post by bluefirebrand »

9rx wrote: post #509
Whoppertime wrote: post #498

Earlier quoted context omitted.

Some people really just want a back yard with a white picket fence their kids can play in

Sure, but outside of where that backyard is wanted to be hundreds of acres, then there is the density necessary to introduce amenities like jobs, healthcare, shopping, etc. alongside the backyard. At which point you no longer need transportation as you have everything you need right there. But what happens in the places we're talking about is that the people accept a small backyard in order to keep everything close,…

> What do people see in these strange middle places?

Not sharing a wall or ceiling with other people is great actually

I am constantly told that dense housing "built right" is quiet and peaceful and you never hear your neighbors through the walls, but my experience in apartments in my 20s was not like that

I constantly had neighbours that would play loud music at all hours, or get into fights with their partners or otherwise just be extremely disruptive and stressful to share a building with

I'll take the trade of having to drive a couple more minutes to get to a store if it means I never have to hear my neighbours having loud sex through the walls again at 2am when I'm trying to sleep

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

#588

Post by bluefirebrand »

vel0city wrote: post #552
chasd00 wrote: post #543

Earlier quoted context omitted.

Many people who live in those towns you describe work in McKinney, Plano and other parts of the suburbs. I’m not saying you’re wrong because there certainly are those people that make those commutes. I personally know a dev who lives in Prosper and another who lives in Melissa and they both commute to Las Colinas! Their reasoning was home affordability, home value growth, and school quality.

Many people do, I agree! I'm not trying to paint it as everyone living there does have an hour commute, it's true many don't. But yeah, go work a job in Addison, Las Colinas, deep in Plano, etc. You'll find a lot of coworkers living in Farmersville, Prosper, Melissa, etc. > Their reasoning was home affordability, home value growth, and school quality This is yet another set of data points showing what I'm talking abo…

> These people live there because it was cheap when they bought it, they expect the metroplex to keep growing increasing the value of their eventually "closer in" home from where the outskirts will be in a decade, and schools are better than other places they might have afforded to buy. Am I wrong

I think you are wrong, yes

Could be I'm the one who is wrong, but I don't think most people buy homes with this sort of speculation in mind. Most people are just looking for the most comfortable and nicest house they can afford on their budget, and probably don't actually think too much about "what might be built later"

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

#589

Post by 9rx »

danans wrote: post #573
9rx wrote: post #562

Earlier quoted context omitted.

> If you live in a pre-car American town Technically it was established before the automobile, but its tenth of a mile downtown commercial strip is the only remaining remnant of that. For all intents and purposes, it was built to "modern" standards, which is to say that its density is on par with the average American suburb. – To be fair, the streets and sidewalks are sensibly laid out. Some of those winding maze sub…

> The difference is really only that people in towns of 3,000 people want all the jobs, services, and amenities as possible. Whereas suburban folk fight tooth and nail to keep it all out. But the question is: Why? Why wouldn't you want those things nearby, most especially when you are complaining you can't afford transportation to those amenities where there are found elsewhere? Because the amenities usually require…

> which might then compromise some of the reasons you liked the suburb in the first place.

What might be those reasons?

This 3,000 person town has some very well paid people and low paid workers living side-by-side seemingly in harmony. Seriously, I really cannot imagine any quality that would be different in a suburb. I did even live in a suburb of a large city a number of years ago for a while when I was young and dumb and I can really find no noticeable difference in the way of life other than everything I do outside of the home is a lot easier to access now.

Granted, in this part of the world the small town/rural areas are predominantly – almost exclusively, even — white. Is that what you're trying to subtly hint at? That the people in those suburbs are afraid of reverting their "white flight" efforts? Apparently that's a thing, astonishingly.

> I don't think suburbanites complain about the cost of transportation.

That's exactly how we got here, though: Comments were complaining about how transportation is of high cost/unaffordable. When we dug into why transportation was even needed, the answer was that many people live in suburbs that are void of any nearby jobs, other amenities, or anything at all, requiring access to transportation to live out life.

The people who don't need transportation because they have those things nearby have no need to be worried about the cost of transportation. So who is worried about the cost of the transportation? Are you suggesting nobody — that the original comments were making shit up?

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

#590

Post by hackable_sand »

JamesBarney wrote: post #494
darth_avocado wrote: post #458

Earlier quoted context omitted.

> 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 “average person” doesn’t make enough money to pay rent or afford groceries. You’re blaming the poor based on your idea of what an “average person” looks like, which is a representation of middle and upper middle class. The average person doesn’t have the…

The median household income is 80k which is plenty to afford groceries and rent. How did you come to believe that half the people in the richest country in the world can't afford to eat or have a roof over their head?

Because it is a lived experience.

I will say the exact same thing for me and 90% of the people around me.

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