3 ms·
> If someone wants to get a loan I don't see how a single number has any bearing on reliability. It boils a multi variable question into one number. That's the
by twblalock 9y ago
> If someone wants to get a loan I don't see how a single number has any bearing on reliability. It boils a multi variable question into one number.
That's the point! It's a way to aggregate a lot of complex things into a simple number that makes it easy for lenders to predict risk. It's not supposed to be perfect, and it doesn't need to be. It just needs to be predictive of risk for lenders. Clearly it is, or they would have stopped using it by now and moved on to another way of predicting risk -- probably another kind of numeric score, because of how useful they are.
Imagine what a pain it would be if you had to provide proof that you paid your bills on time for the past 7+ years in order to get a loan, because the lender can't just get a report from Equifax.
- anfilt 9y agoI think I should have that choice though. If you want the convenience go head give your data to the credit reporting agencies. I don't get loans. So I don't care.
- chrisan 9y agoThe problem would be all the data you _don't give_ You act like everyone is a good citizen, you may be, I may be, but people out there will cheat if left to their own reporting
- twblalock 9y agoYep, and the downside of that is that so many people will lie that lenders will assume everyone is lying. People with good credit who have nothing to hide would be worse off under a self-reporting regime because lenders won't believe them and will turn down their applications or demand an invasive level of financial information.