As I continue to read here, I am curious about the CFL issues. Years ago, when we knew nothing about our credit reports or FICO scoring, we did periodically use store offered CFLs ... not having any idea that they could negatively impact our credit. Each time we did so, we had the cash to pay for the purchases, but used their 0% financing instead of losing interest on money in the bank. We also could have easily obtained personal loans through our CU ... just not 0% loans.As we educate our children about the wise use of credit, this is something we need to discourage them from? Obtaining a 0% loan and paying it off before the date the finance charges start hitting them? Even when we do that ... it is still bad??? I never realized that as consumers, we needed to evaluate the status of our lender and how THEY could be a risk for us instead of the other way around.
I would STILL like to know how exactly one determines if a loan is a consumer finance loan, and if all the powers that be define them the same way. Pretty obviously, the Wells Fargo Finance offer that came in the mail (and was gladly taken) a couple of years ago was a CFL, but signature loans from a credit union? Free financing from a furniture store? What is the precise definition?
And how exactly are they "penalized?" Maybe they're not so much penalized as not given equal weight with car loans and mortgages, similar to store and gas cards not having as much oomph in scoring as do the Big Four credit cards.