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I am someone who believes the world would be better off without these companies. My argument generally goes like this: - Credit existed before reporting agenci

I am someone who believes the world would be better off without these companies. My argument generally goes like this: - Credit existed before reporting agencies - It's possible to verify creditworthiness without a reporting agency - Reporting agencies aren't particularly good at their job anyways You may dislike the first two arguments, because obviously they make debt more expensive. I don't think that's the worst thing in the world. So, I'll focus on the last point. Credit reporting agencies often have incorrect info. Here's an FTC study that says one in five have wrong info that was corrected. [0] You may argue that I should use the other number, ie. people who still had errors after fixing it: 2.2%. But, it oftentimes by the time you fix an error, the opportunity to get the thing you want (ie. job, apartment, car, house, etc) has passed. But even if the data was correct, the way they generate the score manipulates people into taking on more debt than they should and take on worse debt. Getting and using one or more credit cards is the easiest ways to improve your credit score, and this is honestly bullshit. Credit cards encourage bad spending habits and trap people in debt. The credit card companies rely on people carrying a balance and a really good way to make that happen is to make sure everyone uses their credit cards for everything. Meanwhile, things that should improve your score often don't. For example, rent and utility payments only count if they are reported and a lot of landlords or companies don't report or only report if you don't pay. Maybe it's not the credit reporting agencies' problem if people don't report good behavior. And, I don't know what efforts they've made at getting more people to report. But my bias tells me that they probably just don't care. [0] https://www.ftc.gov/news-events/press-releases/2015/01/ftc-issues-follow-study-credit-report-accuracy https://www.ftc.gov/news-events/press-releases/2015/01/ftc-i...

SilasX 8y ago
>- Credit existed before reporting agencies >- It's possible to verify creditworthiness without a reporting agency Absolutely, it was called "whether the banker knows you from church as a good Christian man".
- neuland 8y ago
  whether the banker knows you from church as a good C̶h̶r̶i̶s̶t̶i̶a̶n̶ ̶m̶a̶n̶ person Is that supposed to be a bad thing? Edit: I kinda regret responding to this now because I'm thinking its trolling. Knowing someone personally to be reliable in repaying debt is a valid strategy. It is basically the human lender's internal approximation of creditworthiness and it's how most one-on-one personal lending works. Also, it definitely does not exclude more rigorous methods based on verified info and using a known algorithm to weigh creditworthiness. Edit 2: Is it a bad thing that getting a loan requires you to go to church? Yeah, kind of. Yup. Troll.
  - SilasX 8y ago
    Is it a bad thing that getting a loan requires you to go to church? Yeah, kind of. Edit: Now I don't know what I'm responding to. You agree that someone's history in repaying debts is legit to use as an indicator. You agree in augmenting the lending decisions with algorithms. That's what credit reporting is! And yet somehow that's a defense of your conclusion that "therefore it should be more based on whether your social circles include the people with money" (which no one would scream bloody murder about for being anti-minority)? I'm lost.
    - neuland 8y ago
      We seem to have talked past each other. I have no issue with credit reports per-se. Rather, I believe that they systemically mis-categorize bad behavior as good and underreport good behavior that is non-traditional. Also, I have no idea what you are talking about with Church things. I never mentioned Church or basing lending on social ties.
      - SilasX 8y ago
        >I am someone who believes the world would be better off without these companies. My argument generally goes like this: >Credit existed before reporting agencies So, you like credit reporting, but not credit reporting agencies? Can you see how I might have missed this subtlety, since you never even tried to justify it? Upon examination, your position isn't even against "credit reporting agencies", but "having wrong credit information". Great, everyone agrees, but it's unclear what you're saying should be different from the current system, now that you say you like "credit reporting". >Also, I have no idea what you are talking about with Church things. I never mentioned Church or basing lending on social ties. Or you forgot already. The Church came up because I pointed out that, yes, lending did exist before credit reporting agencies, but only based on these informal social cues, like whether someone "seems like a good Christian man" (gender intended) or whether your went to the same church (yes, church specifically). Then we had this exchange: >>[lending was based on] whether the banker knows you from church as a good C̶h̶r̶i̶s̶t̶i̶a̶n̶ ̶m̶a̶n̶ person >Is that supposed to be a bad thing? Now you're acting like none of that happened, and also calling me a troll. If there's a clear argument, I'd like to engage with it, but I can't discern what it is from your comments.

SilasX 8y ago

>- Credit existed before reporting agencies >- It's possible to verify creditworthiness without a reporting agency Absolutely, it was called "whether the banker knows you from church as a good Christian man".

neuland 8y ago
whether the banker knows you from church as a good C̶h̶r̶i̶s̶t̶i̶a̶n̶ ̶m̶a̶n̶ person Is that supposed to be a bad thing? Edit: I kinda regret responding to this now because I'm thinking its trolling. Knowing someone personally to be reliable in repaying debt is a valid strategy. It is basically the human lender's internal approximation of creditworthiness and it's how most one-on-one personal lending works. Also, it definitely does not exclude more rigorous methods based on verified info and using a known algorithm to weigh creditworthiness. Edit 2: Is it a bad thing that getting a loan requires you to go to church? Yeah, kind of. Yup. Troll.
- SilasX 8y ago
  Is it a bad thing that getting a loan requires you to go to church? Yeah, kind of. Edit: Now I don't know what I'm responding to. You agree that someone's history in repaying debts is legit to use as an indicator. You agree in augmenting the lending decisions with algorithms. That's what credit reporting is! And yet somehow that's a defense of your conclusion that "therefore it should be more based on whether your social circles include the people with money" (which no one would scream bloody murder about for being anti-minority)? I'm lost.
  - neuland 8y ago
    We seem to have talked past each other. I have no issue with credit reports per-se. Rather, I believe that they systemically mis-categorize bad behavior as good and underreport good behavior that is non-traditional. Also, I have no idea what you are talking about with Church things. I never mentioned Church or basing lending on social ties.
    - SilasX 8y ago
      >I am someone who believes the world would be better off without these companies. My argument generally goes like this: >Credit existed before reporting agencies So, you like credit reporting, but not credit reporting agencies? Can you see how I might have missed this subtlety, since you never even tried to justify it? Upon examination, your position isn't even against "credit reporting agencies", but "having wrong credit information". Great, everyone agrees, but it's unclear what you're saying should be different from the current system, now that you say you like "credit reporting". >Also, I have no idea what you are talking about with Church things. I never mentioned Church or basing lending on social ties. Or you forgot already. The Church came up because I pointed out that, yes, lending did exist before credit reporting agencies, but only based on these informal social cues, like whether someone "seems like a good Christian man" (gender intended) or whether your went to the same church (yes, church specifically). Then we had this exchange: >>[lending was based on] whether the banker knows you from church as a good C̶h̶r̶i̶s̶t̶i̶a̶n̶ ̶m̶a̶n̶ person >Is that supposed to be a bad thing? Now you're acting like none of that happened, and also calling me a troll. If there's a clear argument, I'd like to engage with it, but I can't discern what it is from your comments.