Personal Credit Scores system

Discussion in 'Economy' started by tigerbob, Mar 10, 2010.

  1. tigerbob
    Offline

    tigerbob Increasingly jaded.

    Joined:
    Oct 27, 2007
    Messages:
    6,225
    Thanks Received:
    971
    Trophy Points:
    153
    Location:
    Michigan
    Ratings:
    +972
    Anyone here understand credit scoring? I understand how they work in principle, but one thing has always surprised me a bit.

    I lived in the US from 94-98. When I left, I have no idea what my credit rating was but I guess it wasn't bad. I then moved back to the UK for a decade, during which time I had no US bank account, no US credit cards, no US income and completed no US tax returns. However, I did have a credit card that I had forgotten to pay off before I left, that had gone into default by the time they tracked me down in England six months later, and that I then paid off from England.

    About 2 weeks after I moved back here in 2008, I wanted to buy a full size pickup. I got a good 'Friends and Family' deal on a RAM 1500 and was going to buy it for cash, but the salesman told me I could get an extra $1000 off if I financed it (the minimum I could finance to qualify was $6K) and that I could pay it off after a month with no penalty, thereby not paying any interest. So I agreed to pay about $17,000 cash and finance the rest. He ran a credit chack on me (which I expected to come back not approved - after all I had only been back for 2 weeks and had no job, no house and no wage slips that I could show).

    My credit score came back at 806. I have since learned that this is a pretty good score. How is that possible? It makes me think that the whole credit score system is pretty fucked up if someone like me, given those circumstances, can get an 806.

    Anyone care to offer an opinion of why this should be, or have any similar stories?
     
  2. Big Black Dog
    Offline

    Big Black Dog Gold Member Supporting Member

    Joined:
    May 20, 2009
    Messages:
    22,930
    Thanks Received:
    5,118
    Trophy Points:
    260
    Ratings:
    +5,757
    I don't know how it works either but I do know that my credit score was 824 when I bought my pick-up truck about 9 months ago. To me, credit should be like (a) you have credit or (b) no credit. Makes no sense to me to have something in between.
     
  3. editec
    Offline

    editec Mr. Forgot-it-All

    Joined:
    Jun 5, 2008
    Messages:
    41,427
    Thanks Received:
    5,598
    Trophy Points:
    48
    Location:
    Maine
    Ratings:
    +5,618
    One wonders how one can be eliminated from the whole damned credit system?

    This credit rating invention is brought to us by the very same people who brought us this economic meltdown.

    The whole damed ediface of the consumer credit economy is the secondary device with which the masters fleece their flock.

    It is the logical extention of the classist FEDERAL RESERVE BANKING system.

    Sadly, few of us can avoid its tenacious grasp over our lives.
     
  4. Ravi
    Offline

    Ravi Diamond Member

    Joined:
    Feb 27, 2008
    Messages:
    81,432
    Thanks Received:
    12,698
    Trophy Points:
    2,205
    Location:
    Hating Hatters
    Ratings:
    +29,889
    Do you have a mortgage? Electric bill, cable bill, student loan, etc...don't all those affect your credit score?

    I'd call and ask.
     
  5. tigerbob
    Offline

    tigerbob Increasingly jaded.

    Joined:
    Oct 27, 2007
    Messages:
    6,225
    Thanks Received:
    971
    Trophy Points:
    153
    Location:
    Michigan
    Ratings:
    +972
    I don't have a mortgage, but do own a house so certainly I now have electric bill / cable bil, etc. The point was that I didn't have at the time I financed the truck, so I have no idea what generated the credit rating.
     
  6. RodISHI
    Offline

    RodISHI Gold Member

    Joined:
    Nov 29, 2008
    Messages:
    10,392
    Thanks Received:
    1,858
    Trophy Points:
    280
    Ratings:
    +5,051
  7. Ravi
    Offline

    Ravi Diamond Member

    Joined:
    Feb 27, 2008
    Messages:
    81,432
    Thanks Received:
    12,698
    Trophy Points:
    2,205
    Location:
    Hating Hatters
    Ratings:
    +29,889
    If you were renting, that would count toward your score. Basically, the scores predict your ability to pay your bills...so unless you were dinged for nonpayment since you came back you'd have a decent score.
     
  8. GHook93
    Offline

    GHook93 Aristotle

    Joined:
    Apr 22, 2007
    Messages:
    17,924
    Thanks Received:
    3,126
    Trophy Points:
    255
    Location:
    Chicago
    Ratings:
    +4,932
    I work at one of the credit bureaus. Your defaulted credit card wouldn't show up, because negative information can only stay on your credit report up to 7 years (BK can last up to 10).

    But I highly doubt your story. Did you see your credit report. 800 FICO scores are nearly impossible to get and it sounds like you would have no credit history whatsoever. In those case they either assign you a 900 or a 0 score, indicating you don't have good or bad credit, rather you have no credit.

    There is a chance the auto company uses the Vantage score, which runs from 500-990. 800 score would be at a B level.

    Did you get a credit card since you been home? Any credit lines? Did you sign up for nicor gas? Do you rent? Does your landlord report your rent payments (there is a trend for many large property management firms to start reporting).

    But there is no way in hell you have a 806 credit score.

    The auto industry uses the FICO score (some use the new Vantage Score). FICO score runs from 300-850.

     
  9. GHook93
    Offline

    GHook93 Aristotle

    Joined:
    Apr 22, 2007
    Messages:
    17,924
    Thanks Received:
    3,126
    Trophy Points:
    255
    Location:
    Chicago
    Ratings:
    +4,932
    less that 2% of the public has over 800 scores and we just met 2! :eusa_liar:

    Look there are NOT just one score out there. There is FICO (all these bureaus have different scores, EQ =Beacon, TU = Empirca, EXP = FICO), there is the new Vantage score, the BK Score, the Recovery Score, Fast Track, Custom Models, Scorex, etc.

    Funny thing is if you get monitoring services and pull your credit report and score, you ARE NOT getting FICO. the only way to get FICO is through myfico.com!
     
  10. GHook93
    Offline

    GHook93 Aristotle

    Joined:
    Apr 22, 2007
    Messages:
    17,924
    Thanks Received:
    3,126
    Trophy Points:
    255
    Location:
    Chicago
    Ratings:
    +4,932
    Don't get anything on credit!

    The credit system is a heck of a lot older than the current problem!

    Credit is based off of:
    (1) How you pay your current credit lines, pay on time good, bad late bad
    (2) Your balance to credit limit ratios
    (3) The number of accounts you have
    (4) Bankruptcy
    (5) And to a VERY small extent credit inquiries (but not how people think and not to impact people think it has)
    (6) The length of credit history. If you have a credit card you never defaulted on for 10 years, that is a lot better than one you had for a year!

    Its a flawed system no doubt, but its a heck of a lot better than the alternative!

    Um not its not! Its a COMPLETELY private institution of 4 agencies. They compile information for commercial use and they are VERY profitable.

    Maybe because not all of us are socialist!:eusa_angel:
     

Share This Page