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Is a bankruptcy greater than >10 years ago statistically a red flag? What do you think would be a better term? The government has several interests, beyond le
by mfringel 9y ago
Is a bankruptcy greater than >10 years ago statistically a red flag? What do you think would be a better term?
The government has several interests, beyond lenders. The government enforces the lenders abilities to claim debts. It is also in the government's interest to allow people to get back on their feet if their finances crater, because taking someone out of the financial system indefinitely is not productive.
Someone, somewhere, could be abusing any system. That, in and of itself, is not a disqualifying feature of a system.
- sol_remmy 9y ago> Is a bankruptcy greater than >10 years ago statistically a red flag? What do you think would be a better term? I think the banks themselves should be allowed to decide when the risk is worth taking. It will all be determined by actuarial tables like every other similar business decision. If the risk of someone defaulting 15 years after bankruptcy is 20% higher, then banks may charge that person 20% more interest.
- mfringel 9y agoAre you familiar with the output of a typical credit report? I'm curious as to why you're focusing on bankruptcy, when there are a significant amount of other signals banks use, which do not age off in the same way.