6 ms·

You could stop at "An entity like Equifax cannot hold such private info and power over our finances" Credit rating is an instrument of control used by banks an

You could stop at "An entity like Equifax cannot hold such private info and power over our finances" Credit rating is an instrument of control used by banks and credit card organizations to force us into debt we don't want. This system is CRAZY and I don't understand why normally anti-establishment and "leave me alone" Americans so sheepishly agree to be involved in a system that hurts our individual liberties every day. When I came to this country the "credit score" system was the single most incomprehensible thing about american society. Still is.

lern_too_spel 9y ago
How is credit-worthiness determined in your country of origin?
__david__ 9y ago
I’m not a fan of credit ratings companies either, but how do they force me into debt?
- magnetic 9y ago
  I suspect the statement is meant this way: in order to build credit (to buy a house later for example), you need to get in debt: you need to get credit cards, loans, etc... and "climb the ladder". Only then will you have a credit worthy status to get a loan for a house. When I came to the US from Europe, I had no credit history and that made it difficult to get any type of credit card, or loan, or anything. I thought it was a catch 22 since I couldn't build credit because I didn't have credit, but there is this thing called "Secured Credit Card", where the bank lends you your own money (that you deposit) to see if you can repay yourself. Had to do that for about a year, and I also managed to get a Macy's card with a $100 credit limit (yes, one hundred) that forced me to shop there to "build credit". After that the climbing of the ladder started with credit limits increasing slowly, etc... up to the point that I was able to get a loan for a house. There's a bit of strategic planning to building credit worthiness, and that requires you getting into some "managed debt". I think that was the spirit of the comment you are asking about.
  - tedmiston 9y ago
    I've always thought it was a little ironic that increasing your credit score is done by getting more credit line than you need then not actually using it (reducing the percentage of your credit line that you do use assuming expenses are fixed).
    - Drdrdrq 9y ago
      This is because credit score is a measure of two things. The first one is obvious - that you are capable of paying your debt if you find yourself in it. The second one however is how valuable you are to the banks. What good are you to them if you never borrow more money than you need? Their best customer is always in debt but regularly making payments (with interests of course).
  - luckydata 9y ago
    you are completely correct, I'm surprised it even needs to be explained.
    - thaumasiotes 9y ago
      A history of regular payments on a card with a $100 limit doesn't require you to go into debt in any way except for an accident of nomenclature. Pay your $5 every month; you'll have normal credit and no carried debt.
      - Larrikin 9y ago
        If it is that easy, isn't it worthless?
        thaumasiotes 9y ago
        No. That is how you build a credit score. If your goal is to build a credit score, it is not worthless, and it is also not a risk to your personal finances or a means by which it is even possible to get into nontrivial debt. A large part of the credit score concept is to flag people for whom paying a trivial bill on time is difficult.
del82 9y ago
> Credit rating is an instrument of control used by banks and credit card organizations to force us into debt we don't want. Wait, how is that?
- luckydata 9y ago
  Let me borrow an Archer-ism: how is it not? https://www.youtube.com/watch?v=spG-Yj0zEyc https://www.youtube.com/watch?v=spG-Yj0zEyc
ams6110 9y ago
> why normally anti-establishment and "leave me alone" Americans so sheepishly agree to be involved Because it's a private system, and it's at least theoretically voluntary. Nobody forces you to get credit cards or borrow money. Credit cards are immensely convenient. I hardly ever carry cash anymore. I buy everything from coffee to lunch to groceries to gasoline using credit cards, and pay the balance every month. If I had to make arrangements to always carry cash to cover those sorts of expenses, it would be frustrating.
- umanwizard 9y ago
  Can't you use a debit card?
  - deleted 9y ago
    [deleted]
  - tayo42 9y ago
    Debit cards dont have the same protection as credit cards.
    - Larrikin 9y ago
      In the current system paying cash out with a debit card means you are losing money. Most businesses charge the same no matter what method you pay with, but credit cards are usually the only way to get part of that profit. I've seen a slight increase in debit card rewards, like with Yelp, airline company dining rewards, and BoA rewards, but those are for the most part random and need to be planned spends. My credit cards will always reward me for using them.
    - howlgram 9y ago
      Please tell me why, i don't get it
      - tayo42 9y ago
        Chargebacks and protection and against fraud are the biggest reasons I think.

lern_too_spel 9y ago

How is credit-worthiness determined in your country of origin?

__david__ 9y ago

I’m not a fan of credit ratings companies either, but how do they force me into debt?

magnetic 9y ago
I suspect the statement is meant this way: in order to build credit (to buy a house later for example), you need to get in debt: you need to get credit cards, loans, etc... and "climb the ladder". Only then will you have a credit worthy status to get a loan for a house. When I came to the US from Europe, I had no credit history and that made it difficult to get any type of credit card, or loan, or anything. I thought it was a catch 22 since I couldn't build credit because I didn't have credit, but there is this thing called "Secured Credit Card", where the bank lends you your own money (that you deposit) to see if you can repay yourself. Had to do that for about a year, and I also managed to get a Macy's card with a $100 credit limit (yes, one hundred) that forced me to shop there to "build credit". After that the climbing of the ladder started with credit limits increasing slowly, etc... up to the point that I was able to get a loan for a house. There's a bit of strategic planning to building credit worthiness, and that requires you getting into some "managed debt". I think that was the spirit of the comment you are asking about.
- tedmiston 9y ago
  I've always thought it was a little ironic that increasing your credit score is done by getting more credit line than you need then not actually using it (reducing the percentage of your credit line that you do use assuming expenses are fixed).
  - Drdrdrq 9y ago
    This is because credit score is a measure of two things. The first one is obvious - that you are capable of paying your debt if you find yourself in it. The second one however is how valuable you are to the banks. What good are you to them if you never borrow more money than you need? Their best customer is always in debt but regularly making payments (with interests of course).
- luckydata 9y ago
  you are completely correct, I'm surprised it even needs to be explained.
  - thaumasiotes 9y ago
    A history of regular payments on a card with a $100 limit doesn't require you to go into debt in any way except for an accident of nomenclature. Pay your $5 every month; you'll have normal credit and no carried debt.
    - Larrikin 9y ago
      If it is that easy, isn't it worthless?
      - thaumasiotes 9y ago
        No. That is how you build a credit score. If your goal is to build a credit score, it is not worthless, and it is also not a risk to your personal finances or a means by which it is even possible to get into nontrivial debt. A large part of the credit score concept is to flag people for whom paying a trivial bill on time is difficult.

del82 9y ago

> Credit rating is an instrument of control used by banks and credit card organizations to force us into debt we don't want. Wait, how is that?

luckydata 9y ago
Let me borrow an Archer-ism: how is it not? https://www.youtube.com/watch?v=spG-Yj0zEyc https://www.youtube.com/watch?v=spG-Yj0zEyc

ams6110 9y ago

> why normally anti-establishment and "leave me alone" Americans so sheepishly agree to be involved Because it's a private system, and it's at least theoretically voluntary. Nobody forces you to get credit cards or borrow money. Credit cards are immensely convenient. I hardly ever carry cash anymore. I buy everything from coffee to lunch to groceries to gasoline using credit cards, and pay the balance every month. If I had to make arrangements to always carry cash to cover those sorts of expenses, it would be frustrating.

umanwizard 9y ago
Can't you use a debit card?
- deleted 9y ago
  [deleted]
- tayo42 9y ago
  Debit cards dont have the same protection as credit cards.
  - Larrikin 9y ago
    In the current system paying cash out with a debit card means you are losing money. Most businesses charge the same no matter what method you pay with, but credit cards are usually the only way to get part of that profit. I've seen a slight increase in debit card rewards, like with Yelp, airline company dining rewards, and BoA rewards, but those are for the most part random and need to be planned spends. My credit cards will always reward me for using them.
  - howlgram 9y ago
    Please tell me why, i don't get it
    - tayo42 9y ago
      Chargebacks and protection and against fraud are the biggest reasons I think.