4 ms·

If “paying you debts” is an “invisible tome of rules” then I’m all for it. Let’s be honest, credit score pretty accurately reflect what they are supposed to me

by refurb 4y ago

If “paying you debts” is an “invisible tome of rules” then I’m all for it. Let’s be honest, credit score pretty accurately reflect what they are supposed to measure - credit worthiness.

corytheboyd 4y ago
I would not loan someone thousands of dollars on a "trust me bro", so I wouldn't expect banks to either. Corruption of the authority judging trustworthiness is bad, but there just needs to be an authority doing this. The real problem is more likely that wages and living expenses are not in sync, which just fucks over the poor people. Using credit to avoid literally dying on the street is more a symptom of wages making no sense. It's sad. I don't like it either. I don't trust these people either. Equifax fucked me and millions of others, and I got a check for $5.21. There is no justice and there never will be.
- epgui 4y ago
  > there just needs to be an authority doing this People will tolerate even the harshest laws if they feel like they are applied fairly. But in this case there is no published rule book, and no published methodology for calculating credit scores. There is not even the most basic transparency.
  - corytheboyd 4y ago
    Don't get me wrong I'd love to see the rule book too. Would you trust the rules though? There will always be the mysterious few with the power. I wish we could just have nice things without corruption :/
    - epgui 4y ago
      > Would you trust the rules though? Rules don't need to be trusted, they need to be written down and available for reading.
33955985 4y ago
A reasonable take if you ignore how this system reinforces existing inequality + the ways this system is used outside its original scope. Also you have to admit it’s kind of fucked up that there’s no total opt out mechanism.
- epgui 4y ago
  It's also super Kafkaesque, because there is no way for you to know why your score is exactly what it is. There is no published rule book or methodology.
  - 33955985 4y ago
    Yep. It’s all a secret. You are measured by an invisible system that you can’t opt-out of, can’t question… oh and just in case you thought you could learn from experience, here comes a newer “version” of the score that determines whether you’re allowed to build equity or whether you’re relegated to paying someone else’s mortgage.
- refurb 4y ago
  That makes no sense. How does “checking if people are credit worthy” reinforce inequity? If you can’t repay, you shouldn’t be taking on debt. If anything it prevents people from taking on debt they can’t afford, stopping them from further inequity. And you can opt out. Don’t use credit at all. (edit: of course a credit record will still exist, but it won't matter if you don't use credit) This sounds like a bunch of people complaining “why can’t I just borrow whatever I want without people checking whether I can repay?”
  - 33955985 4y ago
    > And you can opt out. Don’t use credit at all. Nope. Whether you use credit or not, the credit bureaus collect information about you and share that with all manner of other companies, including employers. Also these systems have inherent racial biases. https://www.forbes.com/advisor/credit-cards/from-inherent-racial-bias-to-incorrect-data-the-problems-with-current-credit-scoring-models/ https://www.forbes.com/advisor/credit-cards/from-inherent-ra...
epgui 4y ago
> credit score pretty accurately reflect what they are supposed to measure - credit worthiness Do they? If that was true, how could we verify it, beyond an initial gut feeling? There is no published rule book or methodology for credit score calculations!
- xyzelement 4y ago
  I get what you are saying but you are not the customer. The customers are lenders which rely on these scores to make lending decisions critical to their business. Presumably these lenders find these scores accurate enough to prevent enough bad loans while not turning away too many credit worthy customers. That said, obviously the models can be improved with more data. I worked for a lender for a while whose edge was giving people a slightly lower rate (or lending to some folks that just missed the cutoff with other lenders) because we thought our model was a bit more accurate than the credit scores / models used by other lenders. But even we admitted to ourselves that these were just marginal improvements, by and large the credit score is a super meaningful indicator.
  - epgui 4y ago
    > Presumably these lenders find these scores accurate enough to prevent enough bad loans while not turning away too many credit worthy customers. And this is precisely the point. If there was an error in your score, you'd have no way of knowing, no reasonable basis for any appeal, and it just sucks to be you. Lenders don't care if individual scores are accurate, they only care about whether they're making more money than they're losing. It's analogous to doing AI gender prediction: it works fine in the aggregate, but you run into issues at the individual level, and it's the individual's rights that I care about.
    - xyzelement 4y ago
      // If there was an error in your score, you'd have no way of knowin I don't think that's true. I remember many years ago getting a free credit report on myself (it may have been a free trial from a monitoring service but I believe you can also just get it from the agencies itself) You get to see the data that is factored into your score. Anything that majorly dings your credit should be obvious (eg Experian thinks you are delinquent on something that is actually paid off) I never had to deal with that but likely the error then is with the reporting bank so you call them to fix the issue. Is there a reason you think this isn't possible?
Retric 4y ago
The issue is the rules include things like lowered scores after paying off a home loan and companies are using these scores for things that have nothing to do with the likelihood of paying back a loan. They don’t even do a very good job of what’s intended as people can literally have an 800 score the week before declaring bankruptcy.
- piyh 4y ago
  It's a score, not a fortune teller. It's for financial modeling, and only one thing of many that lenders look at.
  - Retric 4y ago
    The entire point of a credit card score is to predict the future. Being bad at that because of inherent inaccuracies in their methodology is a problem.
    - gruez 4y ago
      >Being bad at that because of inherent inaccuracies in their methodology is a problem. The parent poster already mentioned that it's "not a crystal ball". It doesn't have to be perfect. Sure, there are some edge cases where it fails, but if it works 99% then it's good enough. On the flip side, do you really want a minority report like system that can predict your future credit with 100% accuracy?
      - Retric 4y ago
        99% accuracy is wildly overstating things. With low enough accuracy such predictions become actively harmful.

by refurb 4y ago

If “paying you debts” is an “invisible tome of rules” then I’m all for it. Let’s be honest, credit score pretty accurately reflect what they are supposed to measure - credit worthiness.

corytheboyd 4y ago

I would not loan someone thousands of dollars on a "trust me bro", so I wouldn't expect banks to either. Corruption of the authority judging trustworthiness is bad, but there just needs to be an authority doing this. The real problem is more likely that wages and living expenses are not in sync, which just fucks over the poor people. Using credit to avoid literally dying on the street is more a symptom of wages making no sense. It's sad. I don't like it either. I don't trust these people either. Equifax fucked me and millions of others, and I got a check for $5.21. There is no justice and there never will be.

epgui 4y ago
> there just needs to be an authority doing this People will tolerate even the harshest laws if they feel like they are applied fairly. But in this case there is no published rule book, and no published methodology for calculating credit scores. There is not even the most basic transparency.
- corytheboyd 4y ago
  Don't get me wrong I'd love to see the rule book too. Would you trust the rules though? There will always be the mysterious few with the power. I wish we could just have nice things without corruption :/
  - epgui 4y ago
    > Would you trust the rules though? Rules don't need to be trusted, they need to be written down and available for reading.

33955985 4y ago

A reasonable take if you ignore how this system reinforces existing inequality + the ways this system is used outside its original scope. Also you have to admit it’s kind of fucked up that there’s no total opt out mechanism.

epgui 4y ago
It's also super Kafkaesque, because there is no way for you to know why your score is exactly what it is. There is no published rule book or methodology.
- 33955985 4y ago
  Yep. It’s all a secret. You are measured by an invisible system that you can’t opt-out of, can’t question… oh and just in case you thought you could learn from experience, here comes a newer “version” of the score that determines whether you’re allowed to build equity or whether you’re relegated to paying someone else’s mortgage.
refurb 4y ago
That makes no sense. How does “checking if people are credit worthy” reinforce inequity? If you can’t repay, you shouldn’t be taking on debt. If anything it prevents people from taking on debt they can’t afford, stopping them from further inequity. And you can opt out. Don’t use credit at all. (edit: of course a credit record will still exist, but it won't matter if you don't use credit) This sounds like a bunch of people complaining “why can’t I just borrow whatever I want without people checking whether I can repay?”
- 33955985 4y ago
  > And you can opt out. Don’t use credit at all. Nope. Whether you use credit or not, the credit bureaus collect information about you and share that with all manner of other companies, including employers. Also these systems have inherent racial biases. https://www.forbes.com/advisor/credit-cards/from-inherent-racial-bias-to-incorrect-data-the-problems-with-current-credit-scoring-models/ https://www.forbes.com/advisor/credit-cards/from-inherent-ra...

epgui 4y ago

> credit score pretty accurately reflect what they are supposed to measure - credit worthiness Do they? If that was true, how could we verify it, beyond an initial gut feeling? There is no published rule book or methodology for credit score calculations!

xyzelement 4y ago
I get what you are saying but you are not the customer. The customers are lenders which rely on these scores to make lending decisions critical to their business. Presumably these lenders find these scores accurate enough to prevent enough bad loans while not turning away too many credit worthy customers. That said, obviously the models can be improved with more data. I worked for a lender for a while whose edge was giving people a slightly lower rate (or lending to some folks that just missed the cutoff with other lenders) because we thought our model was a bit more accurate than the credit scores / models used by other lenders. But even we admitted to ourselves that these were just marginal improvements, by and large the credit score is a super meaningful indicator.
- epgui 4y ago
  > Presumably these lenders find these scores accurate enough to prevent enough bad loans while not turning away too many credit worthy customers. And this is precisely the point. If there was an error in your score, you'd have no way of knowing, no reasonable basis for any appeal, and it just sucks to be you. Lenders don't care if individual scores are accurate, they only care about whether they're making more money than they're losing. It's analogous to doing AI gender prediction: it works fine in the aggregate, but you run into issues at the individual level, and it's the individual's rights that I care about.
  - xyzelement 4y ago
    // If there was an error in your score, you'd have no way of knowin I don't think that's true. I remember many years ago getting a free credit report on myself (it may have been a free trial from a monitoring service but I believe you can also just get it from the agencies itself) You get to see the data that is factored into your score. Anything that majorly dings your credit should be obvious (eg Experian thinks you are delinquent on something that is actually paid off) I never had to deal with that but likely the error then is with the reporting bank so you call them to fix the issue. Is there a reason you think this isn't possible?

Retric 4y ago

The issue is the rules include things like lowered scores after paying off a home loan and companies are using these scores for things that have nothing to do with the likelihood of paying back a loan. They don’t even do a very good job of what’s intended as people can literally have an 800 score the week before declaring bankruptcy.

piyh 4y ago
It's a score, not a fortune teller. It's for financial modeling, and only one thing of many that lenders look at.
- Retric 4y ago
  The entire point of a credit card score is to predict the future. Being bad at that because of inherent inaccuracies in their methodology is a problem.
  - gruez 4y ago
    >Being bad at that because of inherent inaccuracies in their methodology is a problem. The parent poster already mentioned that it's "not a crystal ball". It doesn't have to be perfect. Sure, there are some edge cases where it fails, but if it works 99% then it's good enough. On the flip side, do you really want a minority report like system that can predict your future credit with 100% accuracy?
    - Retric 4y ago
      99% accuracy is wildly overstating things. With low enough accuracy such predictions become actively harmful.