Time for the Government to put an end to FICO

[BungalowMo]

[kittygal]

Wonderful response!  I just love this forum!

[BungalowMo]

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@kittygal wrote:

Wonderful response!  I just love this forum!

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Yeah...we love it here too!   And ya gotta love "google images"! 

[Anonymous]

Wait a second here. You are saying we should all cut up our cards and forget FICO just because YOU did it? Since when did you become the standard? If you've saved $700 a month it is because you are not using credit. Whether or not FICO exists you can avoid interest charges by not charging stuff.

Not everyone is like you. You do what works for you and I'll do what works for me

[CanOnlyGetBetter]

O.K., you guys have me LMAO

I for one say who cares if you're getting paid!  All I know is that I have gotten some very good advise from all of you.  I have learned plenty.  I have found the courage to completely revamp my finances and play the game.  I applaud all of you for your knowledge and willingness to share your knowledge, paycheck or not.  If it weren't for this website, I wouldn't be well on my way to buying a house.  You are helping me to help myself in improving my lifestyle and achieving my financial dreams.

[Anonymous]

Let's be honest here.  People have become paranoid about their credit, and the credit bureaus are cashing in on it.  "Sign up with Equifax and get your 3 in1 score" - more often than not, the score are accurate. TU 3 in 1 is totally different than EQ - sometime off by 60+ points. EX, EQ, TU are all making out like bandits with the monthly fees paranoid consumers are paying. I was one of them - I had a membership to all three at one point. 

I purchased a vehicle a few years back and learned my middle score was 60+ points higher than any of the three.  The 3 in 1 "gimmick" is rarely accurate, If I need to check my scores, i just pick up the phone and speak to a rep, or my bank [USAA] provides a free report form each bureau 1 a year, or for a nominal fee anytime after (not to exceed the  $14.95 - $39.95 monthly fees EQ, EX, TU charge).

The credit scoring system is suspect, if an individual falls behind with debt and their score drops, the "system" is designed to keep people in the low score bracket for as long as possible to make money off of them through high interest rates.  One guaranteed way around this is to piggyback off of a friend or family member's credit - I've seen it work.  My friend did this with her husband, and his score went up 100+ points inside 8 months.  If you wait on the gov't to fix the system, you're kids will get old 'n grey first.

Lastly, should you choose the piggyback option to repair your credit faster. I hope that you consider your experience as a teaching point, and try your best to avoid getting [back] into the same situation.  If so, you deserve what you get!

[Anonymous]

You can go without a credit score just fine, until you try to buy a house. Perhaps you live in a distressed area where a home can be bought for $20,000 or so, and then you don't need credit even for that, if you're willing to save up, but in most areas of the country, a decent home costs a couple hundred thousand dollars, and most people wouldn't be able to get into one unless they use credit. For that you need a good payment history.

As for everything else - I agree that paying only for what you can afford is the way to go. You can pay for all your clothes, vacations, and cars with money you've already earned. You should have at least one credit card so you can buy things over the internet, rent a car, purchase ariline tickets, etc., if you ever need to do those. Otherwise, your financial lifestyle should lead to a good credit score, so I don't ge the animosity to financial institutions having a tool at their disposal to make lending more objective, and less risky.

Randy - Certified Financial Planner (TM) Professional

[Anonymous]

AMEN and well said! Unfortunately, you can't avoid the damned FICO scores or the Experian/TranUnion/Equifax cabal. Last year I discovered that my insurance company (homeowner's, auto and umbrella) and probably my Health Insurance company use some form of credit scoring to determine their premiums. Regardless, I said to hell with My FICO and stopped checking my score. It is what it is. With credit card companies canceling infrequently used cards or unilaterally reducing credit limits, FICO scores can tank even if you are financially prudent. I am just as disgusted with the Credit Bureaus and their error-riddled reports. Nevertheless, I request a credit report for my wife and I every four months and immediately contact then with any error I discover. I detest these legal extortionists and will give them as much aggravation as I can. That being said, I realize that many people need some credit scoring because of their irresponsible financial behavior. I don't have a good answer except for everyone to request their free credit reports and nail the credit bureaus for any errors they find. P.S. Last I checked - about a year ago - my score was over 800.

[Anonymous]

I had no debt whatsoever until about three years ago and therefore was not even on FICO's radar. I needed to move from my apartment and wanted to buy a house and applied for  credit cards mistakenly  thinking I needed that sort of credit history to to qualify for a loan (didn't know about manual underwriting). Anyhow, the cards came in handy when the water heater went out, the furnace died (during a horrendous cold spell or course) and the car needed two major repairs all within a few months, but I can see how  credit card debt can snowball, especially if not used judiciously,  and seem almost impossible to get out from under. I plan on paying off the cards and closing the accounts as I much prefer relying on an emergency fund. I agree with "Done" that the policy should be "If I don't have the cash, I can't afford it." Living off credit  is a dumb idea.  Having said that though, asking for the government to step in and ban FICO scoring is just plain silly. I'm tired of people in general expecting the government to step in and save us from ourselves. If you pay cash for everything (except a house), or at the very least pay off your credit cards in full every month, you don't need to worry what your FICO score is doing to your interest rates. Lenders are always going to use some sort of scoring method to determine credit worthiness - I'd prefer they use my past payment history and so on to do so rather than my sex, nationality, or something else totally out of my control.

[Anonymous]

@fused wrote:

Please be advised that cross-posting is prohibited in the forums. In the future, please refrain from doing so. 

Just so you know:

I'm not employed or contracted with FICO, and I'm not paid a single penny to moderate these forums. I volunteer my time. The biggest reason I continue to participate in these forums is to help others improve their lives and help them not to become slaves of banks. That said, your assertions about me and others is false. Debating and arguing facts is one thing, making groundless accusations is another.

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What is cross-posting? Just want to make sure I don't accidentally do it as I don't know what it is. Thx