Current Events > More proof credit scores are a complete and utter farse

(+) Yeah! (+)

Every time I log in to experian, I'm usually floating around 750

But I just got a mortgage approved, so they sent me a report saying "just FYI here's the numbers we found from each of the three bigguns"

and i had like 786 from TU, 800 from experian, and 810 from equifax

so like, what the fuck?

on top of that, each one had a summary of what adversely impacted the score. one of which was something like "no revolving account balances"

which is fucking stupid because like, i'm not going to deliberately avoid paying my credit card for a month just so it shows up as a "balance." i pay that shit off like every other day. im not gonna risk sitting on a balance for an extra period of time just so some bogus computer can say having money owed is a good thing instead of, y'know, having NO money owed being a better thing

You dont have to pay it off every other day. Just pay then off at the deadlines

And those are insanely good scores anyway

There's more credit reporting places than the big three and banks will use ones that are either more tailored or cheaper for them to use.

The reason having a revolving balance looks better is because it shows you pay something back constantly. Usually something like a car payment and occasionally rent payments are seen as way better indicators of being able to pay off something. A tiny credit card balance really isn't weighted too much anyway and the lender usually weighs everything they see alongside a credit report.

Someone with a car payment of 4 years with a credit score of 700 can often look better than an 800 score with nothing going on to the person dealing with the loan request. Some bigger factors would be DTI and any negative marks

It is dumb and arbitrary for non-automatic approvals from my experience

Damn_Underscore posted...

You dont have to pay it off every other day. Just pay then off at the deadlines

Seems like a great way to get into debt -- people use credit cards like free money for a straight month, then the bill comes in and they're like fucking hell

Treat it like a checking account -- pay it off every day or every other day. Everything is online so it's much easier to get a snapshot of what you actually have left vs. what you still owe.

Agonized_rufous posted...

Someone with a car payment of 4 years with a credit score of 700 can often look better than an 800 score with nothing going on to the person dealing with the loan request.

That helps my point though -- the issue is with how the system is built. Someone with a good payment history on four years of a big ticket item like a car shouldn't have a 700, they should be higher than that.

The person with zero history shouldn't have an 800.

On the surface, I agree. The person with a good payment history should have a higher score. They shouldn't be punished for being good.

Good job keeping your credit score high. I just recently got back into the 700+ club myself planning on staying there

TaylorHeinicke posted...

which is fucking stupid because like, i'm not going to deliberately avoid paying my credit card for a month just so it shows up as a "balance." i pay that shit off like every other day. im not gonna risk sitting on a balance for an extra period of time just so some bogus computer can say having money owed is a good thing instead of, y'know, having NO money owed being a better thing

Yeah I know that too, I remember falling into that trap after getting debt free two years ago and got myself right back into debt after losing track of spending

If you wait until each credit cards deadline (or close to it) you never pay interest. Paying them every day is wasted effort

Credit cards are a convenience and you should always have enough money in your bank account to pay them off.

IIRC 740 is usually the limit of what's considered good enough for the best rates available for most loans anyway. Anything above that is gravy.

Damn_Underscore posted...

If you wait until each credit cards deadline (or close to it) you never pay interest.

It opens up risk of forgetting or overspending. Small price to pay for 30 seconds a day.

Damn_Underscore posted...

Paying them every day is wasted effort

It takes 30 seconds to go to the bank websight, open my credit history, and pay the balance. Additionally, if not more importantly, it's a great way to stay on top of fraud. It's a lot easier to remember what that weirdly-listed vendor actually was when I was just there yesterday vs. 27 days ago.

Well pretty much all my spending is on 30 day cycles now so that isnt an issue for me anymore.

I know all my credit card deadlines and check them a lot when I am bored of something.

Kinda off topic, but if you pay off these small increments on a near daily basis because you have the money to cover it, why not just use just get a credit/debit combo card attached to your checking account?

Unless the CC is giving you rewards/points/cash back.

TaylorHeinicke posted...

Seems like a great way to get into debt -- people use credit cards like free money for a straight month, then the bill comes in and they're like fucking hell

Treat it like a checking account -- pay it off every day or every other day. Everything is online so it's much easier to get a snapshot of what you actually have left vs. what you still owe.

How would waiting until the end of the month make you spend more? You can check the balance online at any time and see how much you've spent.

TaylorHeinicke posted...

It opens up risk of forgetting or overspending. Small price to pay for 30 seconds a day.

It takes 30 seconds to go to the bank websight, open my credit history, and pay the balance. Additionally, if not more importantly, it's a great way to stay on top of fraud. It's a lot easier to remember what that weirdly-listed vendor actually was when I was just there yesterday vs. 27 days ago.

Most of us just set it to autopay so there is no forgetting. I review my statements and don't have trouble noticing unexpected charges. I have 10 or 11 cards and never paid an annual fee or interest on any of them. But personal finance is personal so you do you.

To the original point - another factor that confuses people is that there are different FICO models. In theory some FICO models are more accurate than others for different things, like for auto loans or for mortgage loans. So the score given might be unexpected because it's a different FICO model. And if you saw your score through Experian directly then this part doesn't apply, but in general a lot of people are also confused because sites like CreditKarma and stuff use VantageScore, which is altogether not the same algorithm as FICO but is kinda close to it. But that's another reason the scores would be unexpectedly different.

bigblu89 posted...

Kinda off topic, but if you pay off these small increments on a near daily basis because you have the money to cover it, why not just use just get a credit/debit combo card attached to your checking account?

Unless the CC is giving you rewards/points/cash back.

Credit card has points/rewards, yeah

Damn_Underscore posted...

Well pretty much all my spending is on 30 day cycles now so that isnt an issue for me anymore.

I know all my credit card deadlines and check them a lot when I am bored of something.

Which is fair if you've got it down to a science like that. I know mine cycles on the 12th or something close to there. But IMO I'd rather review 30 seconds a day or every other day vs. spending entire minutes going over a month worth of spending and potential research trying to recall what something was three weeks ago.

NoxObscuras posted...

How would waiting until the end of the month make you spend more? You can check the balance online at any time and see how much you've spent.

Right but then what's the point of not paying then and there? If I'm going to spend time getting to the bank websight anyways, why not just pay it off since you're there?

Kuuko posted...

Most of us just set it to autopay so there is no forgetting. I review my statements and don't have trouble noticing unexpected charges. I have 10 or 11 cards and never paid an annual fee or interest on any of them. But personal finance is personal so you do you.

Autopay works for some too, but I don't like not having the control. If there's fraud on something and my bank autopays, then it's gonna be a lot harder to get that money back. Also overdraft risk as well, though that really doesn't apply to me based on my spending and how much I usually have in checking.

I would post my credit score but rod will think I'm trying to brag and have some kinda e-dick measuring contest. I don't want to get rod mad.

TaylorHeinicke posted...

Right but then what's the point of not paying then and there? If I'm going to spend time getting to the bank websight anyways, why not just pay it off since you're there?

I have apps for my bank and my credit cards. It takes seconds to open them. Paying them off every other day just seems overkill. But if it works for you then it works.

TaylorHeinicke posted...

That helps my point though -- the issue is with how the system is built. Someone with a good payment history on four years of a big ticket item like a car shouldn't have a 700, they should be higher than that.

The person with zero history shouldn't have an 800.

On the surface, I agree. The person with a good payment history should have a higher score. They shouldn't be punished for being good.

It's just how it be. Having nothing and being at 800 is like dividing by 0. The system isn't able to bother with it but any automatic approvals will take it as is since they're usually smaller accounts with less risk and manual approvals will weigh out everything because the accounts are large enough to be critically processed

I remember wanting to refinance my car years ago but having questionable credit so the finance guy at my bank said I should check what my Equifax score is before they pull it since the inquiry would bring it down, and I'd need at least a 650 to get the rate I was trying. So I went home and paid $30 for an Equifax score which came back as 670. Went back to the finance guy and he ran the report and it came back 644 and we were both dumbfounded, so I called up Equifax and was told that the score I paid for wasn't the same score the banks use

What's the FUCKING POINT THEN

So glad I'm out of that mess and in the 750-800 range on everything and already have a mortgage and shit so I don't really need to apply for anything anytime soon

Yeah it's stupid as hell. I had my credit score around 800, but then it tanked because I paid off all my credit cards balances at once. I rarely ever have a balance above 30% of my limit.

Look at all these responsible goody goody two-shoes whining about not sustaining within the 800 gigachad credit line

Disgusting

oh another note in support of the farse

experian (and i assume the others) have these dumbshit promotions where you can pay to increase your score. like i keep saying ads for the experian boost

literally pay2win

TaylorHeinicke posted...

oh another note in support of the farse

experian (and i assume the others) have these dumbshit promotions where you can pay to increase your score. like i keep saying ads for the experian boost

literally pay2win

I forget which one had the big data breach but they just offered a free year of protection and then you'd have to pay a subscription for after that.

Like, bro

Still better than how it used to be

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which should be the default

if you can pay money to increase your score without changing anything about the spending/credit itself, it should be default

credit score means how easy it is to make MONEY out of you

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why would those third party services report your payments to the bureaus if you're paying experian rather than them?

My score is now in the low 600s and Ive still never had any issues getting new credit.

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im confused then

not gonna lie, im only going on those commercials where experian basically says you can use experian boost to make your score go up. i have to assume it was a paid service or one-time thing or part of their paid subscription or something

how does it work?

CE_gonna_CE posted...

My score is now in the low 600s and Ive still never had any issues getting new credit.

this is me
650 credit and Ive never had any problem getting approved or a interest rate that wasnt decent.

Ive stopped caring about credit score or maintaining my credit. Too much micromanaging and not using the credit that you actually need and got approved for. Just the bases of getting hit on credit checks is just flat out dumb.

hyperpowder posted...

Just the bases of getting hit on credit checks is just flat out dumb.

this too

it's the equivalent of getting modded for just asking questions

hyperpowder posted...

this is me
650 credit and Ive never had any problem getting approved or a interest rate that wasnt decent.

Pretty sure the low-mid 600s range is the average bracket for most people. So it's not that odd.

theAteam posted...

IIRC 740 is usually the limit of what's considered good enough for the best rates available for most loans anyway. Anything above that is gravy.

This
Everything over that is just a dick measuring contest. And just like a real dick measuring contest anything over 2 inches is only for bragging rights because that's all a human vagina can feel

Jiek_Fafn posted...

anything over 2 inches is only for bragging rights because that's all a human vagina can feel

heard brotha

https://gamefaqs.gamespot.com/a/user_image/9/8/8/AAeZUIAAEMTs.jpg

Credit scores are not how well you handle debt, but how likely it is the lender will make money off of you.

TaylorHeinicke posted...

Seems like a great way to get into debt -- people use credit cards like free money for a straight month, then the bill comes in and they're like fucking hell

Well it seems you get it completely. That's the behaviour that is being watched out for.

who gives a shit if banks dont like u paying your bills? They over-exaggerate how much being a "deadbeat" matters.

A "deadbeat" in banking is someone who always pays their bills and never accrues interest payments. i.e. a responsible person.

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because id rather do research before signing up for something that i still dont fully understand

Robot2600 posted...

who gives a shit if banks dont like u paying your bills? They over-exaggerate how much being a "deadbeat" matters.

A "deadbeat" in banking is someone who always pays their bills and never accrues interest payments. i.e. a responsible person.

Buddy, you arent a credit bureau, and your opinion of America's credit system isnt gonna get anyone financing.