5 ms·

That is insane. How is that rationalized by the credit card companies?

kybernetyk 13y ago
I guess statistically ;) They take average paying morale in a neighborhood into account. But I guess one very bad seed can spoil pull down a otherwise good/average neighborhood.
- bougiefever 13y ago
  All the more reason to open a private mailbox and conceal your real address from banks, employers, and when making purchases. Also, since I live outside of the city, shipping is cheaper too. I doubt the UPS store has a bad credit rating.
  - wyclif 13y ago
    For many consumers, their bank already knows their physical address since they have their home loan through the same bank.
    - bougiefever 13y ago
      The original post sounded like they were renting, so yea, your mortgage holder knows the address of the house you bought, but your bank does not need to know the address where you are renting. A personal mailbox is not going to shield your private address from every entity, but it can help with many. Also, the mortgage holder does not know if you are still living in that house, especially if you list a different address.
  - mh- 13y ago
    you don't think that their databases also identifies CMRAs? they are well known addresses. http://en.wikipedia.org/wiki/Commercial_mail_receiving_agency http://en.wikipedia.org/wiki/Commercial_mail_receiving_agenc... https://ribbs.usps.gov/index.cfm?page=mtcsa https://ribbs.usps.gov/index.cfm?page=mtcsa (you can also google for dpv cmra)
- jk4930 13y ago
  Usually one bad apple won't kill the area rating, they filter for that. Image search for "schuldneratlas" (a detailed map of private households in distress) to get some impressions. Or see there: http://www.boniversum.de/schuldneratlas/ http://www.boniversum.de/schuldneratlas/
- simoncion 13y ago
  That's very strange. IMO, it might make sense to operate on the "Folks with bad credit tend to cluster" intuition for folks who have no established credit history, seeing as how you don't have any other data on them. However, it makes no sense to do this for people who have an established track record. I'm sure as hell not going to stop honoring my financial obligations just because I moved into a building with some deadbeat debtor (or worse, just because the debtor moved in to the building!). Do these creditors think that people have the moral fortitude of five-year-olds?!
a3n 13y ago
Data, I suppose. They want to make as many loans as possible. The want to loan you money or grant credit. But if they find a correlation that indicates too much risk they'll say no. The questions then are, is the correlation real, and is doing the correlation legal in the local jurisdiction.
hannibal5 13y ago
Maximizing expected value. You make more profit even when you take into account all the false positives. Profiling people (who have nothing to hide) gives banks and insurance companies huge advantage. It may look insane in personal level, but there is solid math behind many of their descisions.

I guess statistically ;) They take average paying morale in a neighborhood into account. But I guess one very bad seed can spoil pull down a otherwise good/average neighborhood.

bougiefever 13y ago
All the more reason to open a private mailbox and conceal your real address from banks, employers, and when making purchases. Also, since I live outside of the city, shipping is cheaper too. I doubt the UPS store has a bad credit rating.
- wyclif 13y ago
  For many consumers, their bank already knows their physical address since they have their home loan through the same bank.
  - bougiefever 13y ago
    The original post sounded like they were renting, so yea, your mortgage holder knows the address of the house you bought, but your bank does not need to know the address where you are renting. A personal mailbox is not going to shield your private address from every entity, but it can help with many. Also, the mortgage holder does not know if you are still living in that house, especially if you list a different address.
- mh- 13y ago
  you don't think that their databases also identifies CMRAs? they are well known addresses. http://en.wikipedia.org/wiki/Commercial_mail_receiving_agency http://en.wikipedia.org/wiki/Commercial_mail_receiving_agenc... https://ribbs.usps.gov/index.cfm?page=mtcsa https://ribbs.usps.gov/index.cfm?page=mtcsa (you can also google for dpv cmra)
jk4930 13y ago
Usually one bad apple won't kill the area rating, they filter for that. Image search for "schuldneratlas" (a detailed map of private households in distress) to get some impressions. Or see there: http://www.boniversum.de/schuldneratlas/ http://www.boniversum.de/schuldneratlas/
simoncion 13y ago
That's very strange. IMO, it might make sense to operate on the "Folks with bad credit tend to cluster" intuition for folks who have no established credit history, seeing as how you don't have any other data on them. However, it makes no sense to do this for people who have an established track record. I'm sure as hell not going to stop honoring my financial obligations just because I moved into a building with some deadbeat debtor (or worse, just because the debtor moved in to the building!). Do these creditors think that people have the moral fortitude of five-year-olds?!

a3n 13y ago

Data, I suppose. They want to make as many loans as possible. The want to loan you money or grant credit. But if they find a correlation that indicates too much risk they'll say no. The questions then are, is the correlation real, and is doing the correlation legal in the local jurisdiction.

hannibal5 13y ago

Maximizing expected value. You make more profit even when you take into account all the false positives. Profiling people (who have nothing to hide) gives banks and insurance companies huge advantage. It may look insane in personal level, but there is solid math behind many of their descisions.