Why we need 3 CB ?

[newUser0]

Any thoughts? Just one was more than enough

[enharu]

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@newUser0 wrote:

Any thoughts? Just one was more than enough

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Because competition is (supposed to be) healthy.

If there's only 1 bureau, everyone will be getting screwed over by that 1 company because they can simply dictate the terms on how things are done. Banks will be charged a lot more to run customers' credit, which will then pass the cost onto the customers. Customers will be charged more to buy their credit report as well. 

AND the worst part is..........what if there's an issue on your credit report and that 1 company simply refuses to work with you about it? 

[gdale6]

It used to be years ago, the big 3 only served areas of the country and were not national. Experian was TRW served the west, EQ the South and TU the north & east, 40-50 yrs ago if you moved from one area of the country to another you would have to establish credit in that area your history did not follow.

[indiolatino61]

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@gdale6 wrote:

It used to be years ago, the big 3 only served areas of the country and were not national. Experian was TRW served the west, EQ the South and TU the north & east, 40-50 yrs ago if you moved from one area of the country to another you would have to establish credit in that area your history did not follow.

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Wow...that must have been a royal PITA...!

[baller4life]

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@gdale6 wrote:

It used to be years ago, the big 3 only served areas of the country and were not national. Experian was TRW served the west, EQ the South and TU the north & east, 40-50 yrs ago if you moved from one area of the country to another you would have to establish credit in that area your history did not follow.

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I don't even think it was that long ago. When I was first establishing credit back in the 80's I remember Equifax being the only bureau that everyone used here in Texas. Nowadays it all depends on the lender as to who they pull. I dont think I would like the idea of only having one bureau. That's just too much power for one entity to have I think. Wow that would be catastrophic!

[newUser0]

I was actually imagining this, when I wrote this Post.

I thought, that If we had 1 CB, then we had less to manage. But regarding, competition, I was assuming that Fed would pass some laws like Fair Credit Act which will set fair price for monitoring service, banks etc.

Moreever, all the Mortgage, Auto lenders might be able to give a fixed rate for each credit score range. Easy for you to know, where you stand. 

But of course, if you screw up CR, then gone case...

[baller4life]

Haha I forgot Experian used to be called TRW back in the day!! It sure did!!!

[newUser0]

Thank you for sharing your experience.

To be honest, I really can't even image, how would you build your credit from scratch; when you move to other place (For job/Family).

[enharu]

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@newUser0 wrote:

Thank you for sharing your experience.

To be honest, I really can't even image, how would you build your credit from scratch; when you move to other place (For job/Family).

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you just have to. At the end of the day, career and family is much much more important than credit history. You can establish credit history anywhere, but you can't really do the same for your career. 

With regards to your other post: it may be more 'linear' with 1 CB, but things are still never going to be clear cut black and white. Scores are not the only thing lenders look at. Lenders are not going to approve a mortgage for someone who's already overstretched on his DTI regardless of whatever his credit score may be. Someone with a 650 score on the other hand may qualify for the best rates through preferential lending, such as private banking relationship. Hence it doesn't really matter if there's 1 or 10 CBs. Banks will still evaluate apps pretty much the same way as it is now.

Feds can try to pass laws to limit prices, but it's just not going to work as intended. History has taught us that a monopoly tends to screw everyone but that 1 company over. Just look at how well managed most cable companies are. They enjoy local monopolies, and as a result there's really no incentive to compete. Most of the customers are shafted with horrible customer service and there's nothing they can do either because there's just no alternatives.

[takeshi74]

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@newUser0 wrote:

Any thoughts? Just one was more than enough

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Sounds like you need some more experience with Experian.  You definitely would not want them as the only CRA.

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@newUser0 wrote:

Moreever, all the Mortgage, Auto lenders might be able to give a fixed rate for each credit score range.

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Underwriting criteria doesn't vary because of scoring models but because of the creditors.  Going to a single CRA wouldn't going to change that.