topic Re: Time for the Government to put an end to FICO in General Credit Topics

Time for the Government to put an end to FICO

Anonymous — Wed, 23 Jun 2010 00:47:18 GMT

I have tracked this thing and played the game for 3 years now..IM convinced it is nothing more than consumer fraud. An un-winnable game that sets you just running in circles.

One thing I have learned in my 45 years the best way to win some games is just not to play. Officially we are done. We have closed all open accounts except 1 Credit Card, moved all savings into a credit Union for now on we will pay cash for any car purchases, and we will only finance when we can find businesses that do not use this FICO fraud scam.

We have been following this policy faithfully for 4 months now...our savings is increasing our asset to Debt ratio is the best its ever been...and our credit union has been great...Don't be fooled you can live very well with a lousy FICO score....Just don't play their game. Pay cash don't play....you can't win!

Re: Time for the Government to put an end to FICO

Anonymous — Wed, 23 Jun 2010 01:19:35 GMT

Well, good luck with that.

As you will (or should) have learned from your three years of experience, lenders are free to use any scoring model they wish (or none). Most use Fico models, some use other models, and the largest institutions have their own proprietary scoring models. Fico has no monopoly. Fico provides formulas that predict risk in general. As with any such formula, there will be exceptions. There will be individuals who are approved but later default, and there will be individuals who are denied but who would have been perfect customers. The institutions that utilize credit scoring are interested in minimizing their risk. It is a numbers game, because those institutions don't have the time to extensively investigate every individual applicant, get to know them, learn to read their minds, etc.

Credit scoring is not perfect, but most of the problems are derived from errors in the underlying data provided to the credit bureaus, not from the credit formula or its designer.

Would you like to ban credit scoring entirely, and go back to the "good 'ol days", where loan approvals were dependent on human whim, and your gender or racial/ethnic background was often the reason for being declined, or having a high interest rate attached to your loan?

Re: Time for the Government to put an end to FICO

Anonymous — Wed, 23 Jun 2010 01:32:36 GMT

Yes its time to ban it from corporations using their own perverted formulates. Time to go back to the local bank and the loan officer. Like I said FICO has to go, the job was passed to these corporate fools and now look at the mess we have.

With our method the wife and I have added $767 per month to our income in save interest and fees by not PLAYING THE FICO GAME...Its like having a fourth small income stream. Cut up those credit cards America! Thumb you nose at FICO. find out if the company you are dealing with uses FICO if they do leave the paperwork on the desk and head for the door. Call you congressional Reps and tell them to put an end to FICO!

Re: Time for the Government to put an end to FICO

Imhotrodcrazy — Wed, 23 Jun 2010 01:54:18 GMT

@Anonymous wrote:
I have tracked this thing and played the game for 3 years now..IM convinced it is nothing more than consumer fraud. An un-winnable game that sets you just running in circles.
One thing I have learned in my 45 years the best way to win some games is just not to play. Officially we are done. We have closed all open accounts except 1 Credit Card, moved all savings into a credit Union for now on we will pay cash for any car purchases, and we will only finance when we can find businesses that do not use this FICO fraud scam.
We have been following this policy faithfully for 4 months now...our savings is increasing our asset to Debt ratio is the best its ever been...and our credit union has been great...Don't be fooled you can live very well with a lousy FICO score....Just don't play their game. Pay cash don't play....you can't win!

At 68 yrs of age I pretty much agree with you. I have always been an advocate of paying cash whenever possible. The exception being, if you want to buy a home. I come from the days of " your word was your bond", and a handshake sealed the deal and it was as good as a contract. I know that the majority of people will laugh at my thinking, but I have peace of mind knowing that I don't have any debt. I deal with one bank only, they treat me well and don't give me any trouble. I charge a tank or two of gas each month and pay it within a couple of days. I am like you, I don't play the games that make everyone else, but me, money. I don't really need a fico score because I don't need to buy anything over time. If I want something, I pay cash. If I can't afford to pay cash, then I can't afford it. It doesn't bother me one bit. Well, for what it is worth, that's my two cents worth.

Re: Time for the Government to put an end to FICO

Anonymous — Wed, 23 Jun 2010 02:18:05 GMT

Well Hotrod its time to get back t that kind of thinking....I do feel sorry for young folks today, my house was bought in the time before FICO...Im glad that we do not have anything big we would have to finance anymore. I was think of buying a timeshare but I will put it off indefinitely now or until I can find a way to do it without financing it

Re: Time for the Government to put an end to FICO

Anonymous — Wed, 23 Jun 2010 16:15:11 GMT

This is the best of everything you have written thus far:

Call you congressional Reps and tell them to put an end to FICO!

Let's tell the President to put aside Healthcare Reform, The oil spill in the Gulf, Housing Crisis, Unemployment, the economy, education, taxes and tell him we need to focus on ending credit scoring altogether!! This is far too important. Afterall, who needs credit scores? Lenders? Naah, they should be able to asses their risk by just looking at me and my income and job stability....why it shouldn't matter how I didn't pay my bills for several years?

I'd bet if you had a score 750 plus you wouldn't be writing such nonsense.

Re: Time for the Government to put an end to FICO

Anonymous — Wed, 23 Jun 2010 17:15:07 GMT

Now this is amusing...FICO cheerleaders!!!...lol. Only in corporatist America...all part of their PR firms image maker "FICO is your friend". Anyhow, I did find another "less one sided forum last night so I will continue my posting there....LOTS of angry people there!. In short up yours FICO, its time for the American people to give back some of the misery you and your slander, fraud, and terribly flawed system has caused.

Re: Time for the Government to put an end to FICO

Imhotrodcrazy — Wed, 23 Jun 2010 17:35:30 GMT

@Anonymous wrote:

I'd bet if you had a score 750 plus you wouldn't be writing such nonsense.

_____________________________________________________________________________________________________________________________

At my age I don't talk nonsense. I don't need a 750 score because I have all the money I need. In addition, I am not as narrow minded or brainwashed as some. I was expressing my "opinion". If you don't like it, ignore it.

Re: Time for the Government to put an end to FICO

Anonymous — Wed, 23 Jun 2010 17:56:17 GMT

Used to have a 720 score until I quit playing the game. I have no idea what it has been for the past 6 months and could not care less....Lik I said ask if they use FICO, if they say yes leave the paperwork on the desk and head for the door

Re: Time for the Government to put an end to FICO

Anonymous — Wed, 23 Jun 2010 18:11:38 GMT

So based off reading your responses to other threads, you are mad that credit card companies increased your interest rates on open cards... refused to pay the new interest rates (and balances), had them charged off, and your score tanked. You then realized you couldn't obtain anymore credit... so you are on a tirade against myFico,not the lenders, to put an end to credit scoring because it isn't helping you.

The ironic part about all this you preach paying in cash and only buying what you can afford, but obviously you were carrying balances on your cards since you are mad about APRs. Your APR means jack squat when you pay your bill in full each month... there is no interest. It seems like you can't make up your mind between hating lender or scoring models. BTW, you praise CUs it seems, which I agree with, but most national credit unions use credit scores as well.

Re: Time for the Government to put an end to FICO

Anonymous — Wed, 23 Jun 2010 19:06:50 GMT

Nope..not suprisingly you have it all wrong. I had really good rates on the accounts I had open. Then they started raising them for no reason. Most I opted-out and kept my rate on the balances and paid them off and THEY closed the accounts because I refused to accept new terms. 3 accounts I paid down except for some fees they added on and the amount of the increased interest...in all told I believe it was around $145 I stiffed them for collectively. Fico went from 720 to 550 and that was around Feb. I have no idea what it is today and I could not care less....As for being turned down for credit...I don't know I have not applied for any type of financing in over a year...I will never again anyhow so we will never know like I said we have 1 cc card for emergencies I charge some gas on once in a while to keep it active. I still get a bunch of credit card offers in the mail and every fly-by-night finance companies that haven't gone bankrupt sends me offers that I save in the fireplace kindling box for fire starter in the winter.

Like I said I don't play games I can't win...and I don't gamble.....we have learned we can live without financing and Fico...

Im looking into finding how I can completely eliminate using a bank now, although my Credit Union is pretty good. The last bank I was in changed names 5 times in 4 years...lol

Re: Time for the Government to put an end to FICO

RobertEG — Thu, 24 Jun 2010 05:59:08 GMT

The day usually comes for most of us. You may need financing for something that your current bank balance cannot immediately absord. A new car, a new home, or cardiac surgery.

If that day never comes for you, you are unique, and can, of course, just ignore the whole credit process if you have the means to just pay cash. The average American Joe cannot.

I would like to hear your views on how to regulate credit scoring.

Credit scoring, in its basis form, is a proprietary trade secret that federal legislation protects. Would you force Coca-Cola to to publish their trade secret formula?

Abolishment of FICO scoring as a commercial venture may be your goal, but lacks any reasonable legal basis that I know of.

Offer your Congressman a legal basis for banning credit scoring. Get your Congressman to support such a measure. Untiil then, opinions on its merits are nothing more than opinions.

Re: Time for the Government to put an end to FICO

Anonymous — Thu, 24 Jun 2010 18:42:13 GMT

Actually the "Average Joe" can...as I am an average Joe and I can give testimony to it. If people would just sit down and crunch the number of what they pay in interest and fees on a monthly basis and start looking at that as a lost income stream. They could do like I did and set a goal to recover that stream and save it to a separate account. Unfortunately so many of we Americans are so caught up in the "Instant gratification" thing (and mind you I am not talking on a high horse here as I spent 30 years doing the same thing) so the idea of saving for a month or 2 to buy something is almost horrifying with our"got to have it now programming".

In days before FIFRAUD, you applied and received credit...if you did not pay the shut you off....Now with the oligopoly that exists (along with the price gouging) the keep it open use FIFRAUD to justify raising your interest to insane levels and smack on the fees until the balance is 3 times what it was...Then of course after the default the rest of us consumers have to pay the bill....FIFRAUD and the credit scorers have ruined the credit system and the proof is all around....I thank god I bought my home in the time before de-regulation and FICO. Personally if I were 25 years younger and faced the mess like there is today I would immigrate..

Re: Time for the Government to put an end to FICO

Anonymous — Thu, 24 Jun 2010 19:13:30 GMT

@Anonymous wrote:
Actually the "Average Joe" can...as I am an average Joe and I can give testimony to it. If people would just sit down and crunch the number of what they pay in interest and fees on a monthly basis and start looking at that as a lost income stream. They could do like I did and set a goal to recover that stream and save it to a separate account. Unfortunately so many of we Americans are so caught up in the "Instant gratification" thing (and mind you I am not talking on a high horse here as I spent 30 years doing the same thing) so the idea of saving for a month or 2 to buy something is almost horrifying with our"got to have it now programming".

In days before FIFRAUD, you applied and received credit...if you did not pay the shut you off....Now with the oligopoly that exists (along with the price gouging) the keep it open use FIFRAUD to justify raising your interest to insane levels and smack on the fees until the balance is 3 times what it was...Then of course after the default the rest of us consumers have to pay the bill....FIFRAUD and the credit scorers have ruined the credit system and the proof is all around....I thank god I bought my home in the time before de-regulation and FICO. Personally if I were 25 years younger and faced the mess like there is today I would immigrate..

Somewhere I believe you are missing something. FICO and whatever a credit scorer is, have nothing to do with the credit system. FICO is a predictor of what your creditworthiness is, nothing more, nothing less. FICO has no control over the credit card companies, the raising of interest rates, price gouging, etc. But, those things will affect your score if you chose not to pay your bills, be late on a payments, etc. FICO is not the bad guy here. You sow what you reap.

FICO has been around for 50 years or so. No one complained back then.

If FICO did not exist, who would be blamed then?

Re: Time for the Government to put an end to FICO

Minato08 — Thu, 24 Jun 2010 20:19:52 GMT

I find it ironic that someone who detests FICO scoring is illustrating his rejection of the system by embarking on a course of action which will positively affect his FICO score. Do not carry a balance on your credit cards and you will save money and increase your credit score. It just seems as if you're just advocating for people to live within their means. That's just good advice.

Re: Time for the Government to put an end to FICO

BungalowMo — Thu, 24 Jun 2010 23:25:12 GMT

@Anonymous wrote:
Well Hotrod its time to get back t that kind of thinking....I do feel sorry for young folks today, my house was bought in the time before FICO...Im glad that we do not have anything big we would have to finance anymore. I was think of buying a timeshare but I will put it off indefinitely now or until I can find a way to do it without financing it

That is exactly why your way of thinking works for you. Not everyone can say "We" bought anything. "I" bought my first house 3 years ago. I'm not young...I'm 51. But I did not have financial help with anything along the way from anyone. I do not have someone to help with the bills and I did not grow up in the "time before FICO".

I have to do what I have to do. And these days, that means looking the absolute best on paper as I possibly can. Do I wish I had no debt??...sure. Do I wish my home were paid for??...of course I do. But could I have gotten what I have today by having absolutely 0 posting on my credit reports? No way.

So until I make those "Dave Ramsey" millions, I will do what I have to do, and play the game with the hand I deal to MYSELF. No one can say that I had help getting what I have, which is more than I'd ever imagined just a few short years ago.

So...since you have no debt and you own your home, why should you care if there is a FICO scoring system in existence or not? You don't need it. Right?

Re: Time for the Government to put an end to FICO

marty56 — Fri, 25 Jun 2010 00:24:08 GMT

The FICO scoring game is easy to play and win as long as you can control how much credit you use and what the reported balances are. The end game in credit is to be able to get the credit you need when your need it and at the best rates that are offered so it is natural to play the FICO score game as a means to that end. it takes years to get a good credit score so it is a long term game.

Unless someone has a lot of money, or lives off the land, credit scores are a fact of life even if you don't borrow money. You won't be able to get a cell phone, cable, sometimes a job.

The rules in having a good credit score are well known and are compatable with good financial health so play and play to win. It is not rocket science.

Re: Time for the Government to put an end to FICO

Imhotrodcrazy — Fri, 25 Jun 2010 01:44:54 GMT

IMO, this is a generational thing. For those of us who grew up being "taught" not to buy something unless we could pay cash for it, is "our" way of life. We were content to save till we were able to do that. Those of you who are much younger grew up in a generation of buy now, pay later. The two groups will never see eye to eye on this issue in my opinion. That doesn't mean that one side is right, and the other side is wrong. While I am set in my old ways, and not about to change, that doesn't mean that we, ( older generation ), are wrong in our thinking. Likewise, for those of the younger generation, your way of life seems normal to you too. I think the older generation is just trying to help by way of giving the younger generation the benefit of our experiences to maybe make your life a little easier. The main point is in letting you know, as most of you do, that debt is a bad thing overall. That paying off debt with very high interest rates amounts to nothing more than legalized loan sharking. While I do agree with the OP in many ways, each of us has to go down the path we choose. Sometimes that path is hard, and with very little choices. I do indeed feel sorry for what this generation has to deal with. I wish each and everyone the best with coping with their debts.

Re: Time for the Government to put an end to FICO

MidnightVoice — Fri, 25 Jun 2010 13:26:06 GMT

"I have tracked this thing and played the game for 3 years now" - just like me. And playing the game has saved me a whole pile of money and allowed me live my financial life in a better way.

Re: Time for the Government to put an end to FICO

LEXiiON — Fri, 25 Jun 2010 21:19:03 GMT

My opinion on the Credit System:

I moved here 5 months ago. There are credit scoring/ credit report systems everywhere in the world. They are used to judge the ability of how someone is able to pay back his/her debt. I am fine with that. So while my US credit history is limited, I do have a history and parts of it were able to get transferred (that just helped me to get a decent score in 5 months). But there are some things, other scoring systems solved a little bit better. I will explain those:

Inquiries: While here every access by a lender is counted as a hard INQ - even if they are grouped together Auto/Mortgage within 30-45 days they appear as a hard pull. Where I come from, lenders have the ability to select rate comparison (or you can request them to do so) and it will be counted as a soft INQ. This applies for all kinds of credit INQs (such as Personal loans, car loans, mortgages, credit cards). Only if you actually accept the card/loan it will be counted as hard INQ.

PIF: I still have a couple of my old cards. They are setup to PIF every month. I charged them really high sometimes during my travel (70% util). It does not affect my score, because they are PIF'd anyway. Here, you have to PIF the card before the statement closes (even with the Amex charge card) to get better utilization. This is what I really don't like. Why should I dismiss up to 25 days of interest free grace period (in addition to the statement period) just because the scoring system is not able to see that I always PIF? This is something that has potential for improvement. It is complete nonsense to me. However I can play that game. I just don't like it.

However the to be fair, the credit reporting system is much more brutal back home than here. If you have any negative information in your report, you won't get any credit from regular lenders (not even a car-loan from a shady dealer). Only non-reporting lender's would give you credit for high jacked rates (those loan sharks that only advertise in certain newspapers). Scoring is different, too. It is set on the probability how you would pay back. That means it ranges from 0%-100% while 100% is impossible to achieve (they admit that on their website). The last report showed my score at 97.3% . And you can also buy your auto-enhanced, mortgage enhanced, banking enhanced etc. Score (however you have to pay for every single one).

There is room for improvement in the system. However I disagree, that you ever can eliminate a credit reporting/scoring system. It is a necessary tool for the lenders. I for myself have no issue making the best out of it, even if I disagree with some of the rules. But there is this forum, that actually really helps to get educated.

There is one easy option for those who hate this system. Quit. Cash only. Your choice.

I personally won't quit. I am too young and there will be times when I need credit. I just follow those simple rules.

My two $cents and three €cents