4 ms·
The US system is kind of broken. They don't equate high salary with high creditworthiness - maybe it's because of the american culture of consumerism (which imp
by acchow 10y ago
The US system is kind of broken. They don't equate high salary with high creditworthiness - maybe it's because of the american culture of consumerism (which implies that you might make lots of money, but if you spend it all and are going into debt to fund your lavish lifestyle, then you're not creditworthy). So the American system rates creditworthiness by a history of paying off debt on time (usually credit cards, mortgage, car loan, etc.).
It's stupid.
It would obviously be better if we judged creditworthiness by your bank balance history. But this is apparently hard/impossible to show.
- SilasX 10y agoRight. Their models are "trained" on people who have credit card debt. No history of using a credit card? "Ugh, weirdo, don't bother, send them to subprime." Happened to me too -- I was working at my first job for 18 months but had never gotten a credit card. I had never had debts and was asking for a mortgage less than 2x my salary while making 3x the median income for the area and at its largest employer; still classified as subprime. What's worse is that I could go to the annual credit report services and get my score, which would show it as 740, but then any actual lender I went to wouldn't see the 740; they'd see "no data", which puts you in the subprime bucket. I would be auto-rejected even for $500-limit store credit cards. (It's been since resolved and I've had a credit card for a while but still, very screwy.)