Credit scoring systems and FICO probably aren't a good idea.

[Anonymous]

Systems such as the FICO system, and the credit reports are overall a pretty bad idea.

As far as I can tell, if a group of wrong doers (or good doers) wanted to help break the system, they could launch automated applications of credit cards based upon phone listings and other data gathered from the public. By doing this, the hard inquiries would drive down the credit ratings of random Americans. If this was done using compromised home computers, such as those sold for pennies each on the black market, it would be difficult to detect and stop.

I originally thought SSN's were required to do such a thing, but after reading where people have had hard inquiries on their reports without this information, it became apparent that it isn't required.

(Don't worry, I'm on the good side, but I just look at "the system" as a whole in terms of reliability and security, and see that it's not so hot).

[wmarat]

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bubbleboy wrote:
Systems such as the FICO system, and the credit reports are overall a pretty bad idea.

As far as I can tell, if a group of wrong doers (or good doers) wanted to help break the system, they could launch automated applications of credit cards based upon phone listings and other data gathered from the public. By doing this, the hard inquiries would drive down the credit ratings of random Americans. If this was done using compromised home computers, such as those sold for pennies each on the black market, it would be difficult to detect and stop.

I originally thought SSN's were required to do such a thing, but after reading where people have had hard inquiries on their reports without this information, it became apparent that it isn't required.

(Don't worry, I'm on the good side, but I just look at "the system" as a whole in terms of reliability and security, and see that it's not so hot).

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Totally agree with you. A system is unsecure and unreliable. Besides, when business is really eager to have you as a customer they know how to disregard all this credit nonsence, take risk and make a deal. When I was shopping for autoloan and was offered unacceptable rate all I had to do is to get up on my feet, say "thank you for your time" and start going away without making a deal then I was given premium rate that I "was not qualified" initially.

[marty56]

CCCs get lists from CRAs based on criteria like credit scores and maybe payment history for pre-approvals.  They are soft inqs.

As far as hackers applying for credit in your name to drive our scores down.  Get real.

They are more interested in stealing your credit cards numbers to charge stuff or apply for credit in your name to use it.

Message Edited by marty56 on 01-01-2008 06:32 AM

[haulingthescoreup]

Hi, bubbleboy, welcome to the forums! I just posted on your other thread.

As wmarat said, no one should allow potential lenders to rely solely on credit scores to make decisions, although some foolishly do. It reminds me of the endless battles that parents have with schools when they attempt to pigeonhole their children according to test scores. In the end, we're all individuals, and businesses lose a lot of profitable relationships by depending on the results of a credit check.

But the reality is, if you are dealing with a nationally-based lender, and you are doing all this online or with a local rep who has no authority to override the default decisions of the computer, then you will want to fit their parameters. If you don't want to (for whatever reason), then set up relationships with local lenders who are more able to look at the total picture. The Big Boys have too much going on to step away from their computer data and work with individuals.

[Anonymous]

This is why the FCRA is in place-

It requires PP to pull someones credit.

You can opt out to prevent promotional inq's.

Fraud alerts make it even more difficult.

[Anonymous]

I wouldn't call them hackers, I call them thieves. Stolen credit cards really don't go for that much on the black market. I think a credit card with $10,000 in credit, full owner information and the CVS code or whatever that silly number on the back is called goes for less than $5. There was a great presentation at Defcon in 2007 that went over what this information is worth on the black market.

I'd take having a credit card stolen over having to deal with CRA's and cleaning up a credit report any day. You report a credit card stolen, the credit card companies don't even care about who did it. They just remove it and refund your money. On the other hand, it is expensive to pay for credit reports and FICO scores, and time consuming to deal with the CRA's and their very bad service (everything is read and reduced to 2 letter codes, often by offshored workers in other countries).