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Income on credit card CRA a new way to validate?

Senior Contributor

Income on credit card CRA a new way to validate?

The other day I got an email from my employer allowing me to op in to Equaifax W2 Managemnt, I have not yet done so however I did notice that experian has a semilar product available to credit card companies called Income Insight W2, I am wondering is this just a new way to validate income ?

 

Here is a link on the news release from experian

http://www.prnewswire.com/news-releases/experian-offers-income-insight-w2sm-for-assessing-individual...

 

Kind of scary all the information available

Message 1 of 7
6 REPLIES
Valued Contributor

Re: Income on credit card CRA a new way to validate?

I don't see any way that this can come out accurate. 

 

Take for instance:

 

My father, 60 Year old man.  Total revolving credit lines is about $12k, student loans of about $10k 2 car loans and a $320k mortgage.  Income: $250k annually

 

Myself, 30 year old man.  Total revolving credit lines is about $85k, no student loans, 2 car loans and $307k mortgage.  Income: $135k annually

 

How is someone going to estimate income for either one that would be anywhere near accurate?

Starting a whole new chapter
Message 2 of 7
Valued Contributor

Re: Income on credit card CRA a new way to validate?


sccredit wrote:

I don't see any way that this can come out accurate. 

 

Take for instance:

 

My father, 60 Year old man.  Total revolving credit lines is about $12k, student loans of about $10k 2 car loans and a $320k mortgage.  Income: $250k annually

 

Myself, 30 year old man.  Total revolving credit lines is about $85k, no student loans, 2 car loans and $307k mortgage.  Income: $135k annually

 

How is someone going to estimate income for either one that would be anywhere near accurate?


Because this is (statistical) data mining.   So with X% certainty, individuals with the following credit report characteristics, have income between $Y and $Z


They don't need a causal model, as the release said (uniquely developed from a deep database of verified income and built on proprietary credit attributes), they use a set of accurate income data and derive patterns based on the corresponding credit report.   So, if you and your father are not outliers, it maybe able to predict quite accurately, just because there are other people like you.

 

Now, it might be that outliers are the ones credit card companies need to be most aware of!

Message 3 of 7
Senior Contributor

Re: Income on credit card CRA a new way to validate?

using verified income, could they be getting that information from when people apply for mortgages and income has to be verified for example?

 

Message 4 of 7
Frequent Contributor

Re: Income on credit card CRA a new way to validate?


bs6054 wrote:

Now, it might be that outliers are the ones credit card companies need to be most aware of!


I just reset to a bad semester in 1996.


GangnamFICO wrote:

Because the chicks dig it when I throw down the card to the waiter and...it comes in handy if I'm short on cash until payday and need a short spot. AMEX gets the booty, and that's important when you're a Pirate.


Minor vulgarity edit --Rev



Message 5 of 7
Valued Contributor

Re: Income on credit card CRA a new way to validate?

Im feeling ya John...i just finished taking not one, but two stats/numerical methods courses this past semester XD

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Message 6 of 7
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Valued Contributor

Re: Income on credit card CRA a new way to validate?


jake619 wrote:

bs6054 wrote:

Now, it might be that outliers are the ones credit card companies need to be most aware of!


I just reset to a bad semester in 1996.


Oh, you're THAT Jake.  Sitting up back, yawning, listening to Black Sabbath and Abba on your Walkman, during my seminar "Really Interesting Details of Statistical Analysis in 13th Century Flemish Lace Design"

Message 7 of 7