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Credit scores change constantly. What your 80 point drop told creditors is "This person might not have enough money to pay their bills, or is careless or forget

Credit scores change constantly. What your 80 point drop told creditors is "This person might not have enough money to pay their bills, or is careless or forgetful.". You are perceived as higher risk because, statistically, you are a higher risk. Those of us who maintain excellent credit do it in part by making sure our money gets where it's supposed to. I check online to make sure payments post, or hand in payments in person, or call in the rare case these days when there's no other way to check. Fortunately, credit scores usually recover rather quickly from one-off delinquencies if you stay current afterward. And I bet you'll be paying more attention to your bills now, won't you? The credit score is doing exactly what it's supposed to.

kome 7y ago
> The credit score is doing exactly what it's supposed to. policing people and make the poor to pay more.
- throwawaycert 7y ago
  If you don't pay your bills, I think it's entirely reasonable for businesses to tell each other about that so you don't defraud them out of a lot of money.
  - XaoDaoCaoCao 7y ago
    >the entire banking system promotes systematic moral hazards and has lowered the purchasing power of stagnating wages for most people "Why are people defaulting on their bills!?" The whole notion of transfer of majority responsibility to an individual is one of the slimiest things in this society. We get monitored by an array of hidden surveillance measures and algorithimic judgement we have no way to properly counter or defend ourselves against. Meanwhile central credit gets to borrow money and get bailed out. Give me a fudging break.
    - throwawaycert 7y ago
      This isn't complicated. You incur a debt, you pay it. If you can't, people aren't going to want to do business with you, and will quite reasonably refuse. You are trying to make everyone else responsible for my finances and I'd damn well thank you to stop, since they're mine.
      - XaoDaoCaoCao 7y ago
        I understand that clearly. But clearly there are classes of institutions and people who... 1. Make a mockery of prudent allocation of money and get bailed out when their games get messed up 2. Mess up the purchasing power of any money you possess far more than any individual defaults or even class of individual defaults 3. Impose grave and hidden responsibilities on individual borrowers and mass surveillance... They are messing up your finances far more than the most reckless individual borrowers ever could. * PS - How is finance going to deal with the multitrillion dollar pension bomb? With prudence or with a combination of a game of musical chairs and chickens until stuff gets serious? How is your financial discipline, as an individual, going to protect you from manmade tsnumais?
        throwawaycert 7y ago
        What are these "grave and hidden responsibilities" you're talking about? Paying your bills is hardly an obscure pastime. As for your PS, I don't respond to conspiracy theories.
        XaoDaoCaoCao 7y ago
        https://worldview.stratfor.com/life-expectancy-pension-retirement-age https://worldview.stratfor.com/life-expectancy-pension-retir... Is the World Economic Forum a purveyor of conspiracy theories? Is our reduced purchasing power at the level of food and rent a conspiracy theory? Edit: My apologies, here's the actual WEF press release https://www.weforum.org/press/2017/05/global-pension-timebomb-funding-gap-set-to-dwarf-world-gdp/ https://www.weforum.org/press/2017/05/global-pension-timebom...
nostrademons 7y ago
I was surprised how much they change constantly, for silly things like how much balance you have on your credit cards. My wife & I both have excellent credit scores, and we pay all of our bills in full every month. Nevertheless, I've noticed a ~50 point swing in credit scores from month-to-month, all dependent on whether airline tickets, furniture, or charitable contributions happened to make it onto this month's bill. Our debt-to-liquid-assets ratio is something like 0.1%, so there's never any real risk of not having money to pay it off, but of course the credit bureaus don't have information about our assets, so they evaluate us against what other people our age have, which (being Millenials) is not very much. Knowing how the system works, we can take steps to game it, like not putting any major purchases on credit card in the 3-6 months before getting a mortgage. But still, it's slightly ridiculous that something that's supposed to measure your creditworthiness can swing so much over short time periods.
- throwawaycert 7y ago
  It's not that weird. If your score is, say, 750, 50 points is about a 7 percent change. My finances very easily vary 7% from month to month! 50 points also isn't likely to make much difference, especially if your score is already good. Loans basically go off tables. Essentially if you're between A and B, you get this rate for this losan, C and D gets this rate, etc. Once you're past 700, you're already getting good interest rates and banks will fall over themselves to loan you money if your income supports the loan size. When I was at 780, the loan officer couldn't give me a lower rate on a mortgage - I was already getting a fraction of a percent over prime.
- lonelappde 7y ago
  You also believe the stock market is nonsense, because valuations fluctuate?
- rootusrootus 7y ago
  It's worth remembering that an important aspect of your score is your value as a customer. Risk is one element. Carrying a balance gives you more value than if you never carry a balance.
mikeash 7y ago
Foisting responsibility onto customers with more important things to worry about, rather than into organizations whose only purpose is to keep track of these things?
- throwawaycert 7y ago
  It is not my job to go out and manage my customer's finances and take their credit cards or write myself checks from their accounts, and I'd be quite rightly arrested for theft if I tried.
  - mikeash 7y ago
    It is, or should be, your responsibility to notify them when payment it due.
    - throwawaycert 7y ago
      Ah, but there is no indication they didn't. What happened is that the check was sent, but did not arrive. In other words, the customer and his agent (the postal service, probably) in the exchange did not fulfill their job of getting the money to the business. That is not something the business can control, and if you try to make it their responsibility, they will simply start refusing payment by mail, since it would be a constant and high level source of fraud.
      - mikeash 7y ago
        But making it the customer’s responsibility is cool? In any case, I read this as the notice that payment was required is what got lost, not the payment itself.
        throwawaycert 7y ago
        Ah, you may be right, but even that still makes the report valid. Let me tell you what I hear as a business person if you tell me my letter to you was misdelivered: "My mail delivery is unreliable so it's your problem." Well, no, you didn't tell me it was unreliable, so I couldn't adjust my risk perception or take special precautions. And if you ever want to do business with me again, you're going to come in and execute the transaction on site and not leave with the goods until the bank confirms it's cleared. On top of which, most billing contracts specify that payment is due whether or not you were notified. You are supposed to keep track, too. And yes, this is okay, because until we have a proper socialist system, it is, in fact, our responsibility to pay our debts. Don't like it? Don't incur debts.
lonelappde 7y ago
> statistically, you Is an oxymoron. Statistics exist when "you" is unknown.
- throwawaycert 7y ago
  "You" have statistics attached to you. Default rates, lifespan, cancer risk. Given people A and B in similar life and financial situations, A or B might defy the statistics that say they'll both pay or default, but they probably won't. The only way a bank or anyone can predict this is statistically.

kome 7y ago

> The credit score is doing exactly what it's supposed to. policing people and make the poor to pay more.

throwawaycert 7y ago
If you don't pay your bills, I think it's entirely reasonable for businesses to tell each other about that so you don't defraud them out of a lot of money.
- XaoDaoCaoCao 7y ago
  >the entire banking system promotes systematic moral hazards and has lowered the purchasing power of stagnating wages for most people "Why are people defaulting on their bills!?" The whole notion of transfer of majority responsibility to an individual is one of the slimiest things in this society. We get monitored by an array of hidden surveillance measures and algorithimic judgement we have no way to properly counter or defend ourselves against. Meanwhile central credit gets to borrow money and get bailed out. Give me a fudging break.
  - throwawaycert 7y ago
    This isn't complicated. You incur a debt, you pay it. If you can't, people aren't going to want to do business with you, and will quite reasonably refuse. You are trying to make everyone else responsible for my finances and I'd damn well thank you to stop, since they're mine.
    - XaoDaoCaoCao 7y ago
      I understand that clearly. But clearly there are classes of institutions and people who... 1. Make a mockery of prudent allocation of money and get bailed out when their games get messed up 2. Mess up the purchasing power of any money you possess far more than any individual defaults or even class of individual defaults 3. Impose grave and hidden responsibilities on individual borrowers and mass surveillance... They are messing up your finances far more than the most reckless individual borrowers ever could. * PS - How is finance going to deal with the multitrillion dollar pension bomb? With prudence or with a combination of a game of musical chairs and chickens until stuff gets serious? How is your financial discipline, as an individual, going to protect you from manmade tsnumais?
      - throwawaycert 7y ago
        What are these "grave and hidden responsibilities" you're talking about? Paying your bills is hardly an obscure pastime. As for your PS, I don't respond to conspiracy theories.
        XaoDaoCaoCao 7y ago
        https://worldview.stratfor.com/life-expectancy-pension-retirement-age https://worldview.stratfor.com/life-expectancy-pension-retir... Is the World Economic Forum a purveyor of conspiracy theories? Is our reduced purchasing power at the level of food and rent a conspiracy theory? Edit: My apologies, here's the actual WEF press release https://www.weforum.org/press/2017/05/global-pension-timebomb-funding-gap-set-to-dwarf-world-gdp/ https://www.weforum.org/press/2017/05/global-pension-timebom...

nostrademons 7y ago

I was surprised how much they change constantly, for silly things like how much balance you have on your credit cards. My wife & I both have excellent credit scores, and we pay all of our bills in full every month. Nevertheless, I've noticed a ~50 point swing in credit scores from month-to-month, all dependent on whether airline tickets, furniture, or charitable contributions happened to make it onto this month's bill. Our debt-to-liquid-assets ratio is something like 0.1%, so there's never any real risk of not having money to pay it off, but of course the credit bureaus don't have information about our assets, so they evaluate us against what other people our age have, which (being Millenials) is not very much. Knowing how the system works, we can take steps to game it, like not putting any major purchases on credit card in the 3-6 months before getting a mortgage. But still, it's slightly ridiculous that something that's supposed to measure your creditworthiness can swing so much over short time periods.

throwawaycert 7y ago
It's not that weird. If your score is, say, 750, 50 points is about a 7 percent change. My finances very easily vary 7% from month to month! 50 points also isn't likely to make much difference, especially if your score is already good. Loans basically go off tables. Essentially if you're between A and B, you get this rate for this losan, C and D gets this rate, etc. Once you're past 700, you're already getting good interest rates and banks will fall over themselves to loan you money if your income supports the loan size. When I was at 780, the loan officer couldn't give me a lower rate on a mortgage - I was already getting a fraction of a percent over prime.
lonelappde 7y ago
You also believe the stock market is nonsense, because valuations fluctuate?
rootusrootus 7y ago
It's worth remembering that an important aspect of your score is your value as a customer. Risk is one element. Carrying a balance gives you more value than if you never carry a balance.

mikeash 7y ago

Foisting responsibility onto customers with more important things to worry about, rather than into organizations whose only purpose is to keep track of these things?

throwawaycert 7y ago
It is not my job to go out and manage my customer's finances and take their credit cards or write myself checks from their accounts, and I'd be quite rightly arrested for theft if I tried.
- mikeash 7y ago
  It is, or should be, your responsibility to notify them when payment it due.
  - throwawaycert 7y ago
    Ah, but there is no indication they didn't. What happened is that the check was sent, but did not arrive. In other words, the customer and his agent (the postal service, probably) in the exchange did not fulfill their job of getting the money to the business. That is not something the business can control, and if you try to make it their responsibility, they will simply start refusing payment by mail, since it would be a constant and high level source of fraud.
    - mikeash 7y ago
      But making it the customer’s responsibility is cool? In any case, I read this as the notice that payment was required is what got lost, not the payment itself.
      - throwawaycert 7y ago
        Ah, you may be right, but even that still makes the report valid. Let me tell you what I hear as a business person if you tell me my letter to you was misdelivered: "My mail delivery is unreliable so it's your problem." Well, no, you didn't tell me it was unreliable, so I couldn't adjust my risk perception or take special precautions. And if you ever want to do business with me again, you're going to come in and execute the transaction on site and not leave with the goods until the bank confirms it's cleared. On top of which, most billing contracts specify that payment is due whether or not you were notified. You are supposed to keep track, too. And yes, this is okay, because until we have a proper socialist system, it is, in fact, our responsibility to pay our debts. Don't like it? Don't incur debts.

lonelappde 7y ago

> statistically, you Is an oxymoron. Statistics exist when "you" is unknown.

throwawaycert 7y ago
"You" have statistics attached to you. Default rates, lifespan, cancer risk. Given people A and B in similar life and financial situations, A or B might defy the statistics that say they'll both pay or default, but they probably won't. The only way a bank or anyone can predict this is statistically.