Credit card help

[wangan_cruiser]

im in the market and looking to get a credit card. i never had credit card ever since ive been building my car. i pay cash everything i purchased. so im really proud that im not in big debt. im trying to get one so i can get started building my credit line for buying a house in the future.the question is i dont know stuff about them and i really need an insight what i need to check and look, which company are good to start with or avoiding. i know most of the members here had ups and downs with credit card, hoping u can share your experience with me.

thanks

[cc4usmc]

http://zilvia.net/f/off-topic-chat/40059-credit-card-recommendations.html?highlight=credit+card
http://zilvia.net/f/off-topic-chat/302813-easiest-way-get-out-credit-card-debt.html?highlight=credit+card
http://zilvia.net/f/premium-members/238418-loans-building-credit-nemo-way-formerly-parting-selling-s14-kouki-4.html

Those might help.

[fliprayzin240sx]

If you get one...keep the limit low so you wont get tempted to buy something crazy and if you do max it out, you wont be too deep into the hole.

[wangan_cruiser]

hey ray wasap.

yea. but my current bank offering me $3000 atm LOL so tempting but my brother told me keep an eye on the apr.

ccm3us thanks for the post

[fliprayzin240sx]

hey ray wasap.

yea. but my current bank offering me $3000 atm LOL so tempting but my brother told me keep an eye on the apr.

ccm3us thanks for the post

If theyre offering you that much...that means you got a pretty decent credit to begin with. Usually, if you have no credit or mid to low credit, they'd start you off less than $1k.

But yah, definitely watch out for the APR (both purchases and cash advance) and make sure there is no annual fees.

[g6civcx]

Despite what anyone tells you about how not having a credit card is bad for your credit, do not get credit at all if you don't need it. By "need" I mean if you don't have money to buy food or medicine or something drastic. Not you "need" a new set of wheels.


Watch out for BS like credit protection insurance, diability insurance, unemployment insurance, moving insurance, etc.

These additional coverages get added to your account, usually as a percentage of your balance. They cost a lot compared to what you get (usually just your minimum payment while you're out).

If you want these coverages, take out a real insurance policy with real coverage from a real insurance company.


Also don't get tempted by free money or giveaway. There's a reason why they want you to sign up: so they can trap you and grow your balance way beyond what you can pay.


Also watch out for BS like variable APR. Most of these are automatically opted in for you unless you explicitly opt out. Whoops, you didn't get the tiny letter with insufficient postage and small print? Not our fault. You get charged a fee nonetheless.

[wangan_cruiser]

yes im not into that using credit cards to buy parts for my car. im about to be out of the game soon hopefully. im trying to get myself on the right road to settle down.

[email protected] yeah i always have a good record in my current bank and theyve been offering me ever since but i decline because i didnt needed them back then.

since 04 ive been paying cash through my parts. hell im even scared to get in debt

[lucky7]

the best advice is to not be a jackass. i have two CC's i've been using for probably 5-6 years. i have no idea what the limit is on them or what the interest rates are. the important part is i don't owe the CC company a dollar and i never pay any interest.

i would get a card through your bank so you can monitor stuff right online. i pay my cards off a couple times a month sitting right here at my house. sofa king easy. don't be afraid of credit cards, just be an adult about it.

[g6civcx]

the best advice is to not be a jackass. i have two CC's i've been using for probably 5-6 years. i have no idea what the limit is on them or what the interest rates are. the important part is i don't owe the CC company a dollar and i never pay any interest.


Do you look at your statement to see if they slip any charges into your balance?

CC companies make their money from each transaction by charging the vendor a transaction fee. The vendor in turn raises prices on everything to compensate for the fees.

Ultimately you pay the vendor higher prices to pay the CC company whether you realise it or not.


You can use most cards as a credit or a debit transaction. I try to run every card transaction as a debit transaction with PIN. The charge goes through a different PIN verification network and the vendor doesn't get charged a transaction fee.

CC companies are catching on though. They're starting to charge YOU the transaction fee if you run a PIN transaction.


Credit transaction: vendor pays. PIN transaction: consumer pays. CC company: profit.

[lucky7]

i was just going to say that last part. i don't do debit, ever. regardless though, whether i use cash or credit, i'm paying the same amount as everyone else. i also don't mind when small businesses have minimum credit charges. we all know it's against their agreement with the CC companies, however, they have to do what they have to do to make money. for example, someone charges a little $.35 pack of gum, the retailer is better off just giving it to you... shit sucks but that's the way of the future. my parents own a small business and have been dealing with the high cost of providing the ability to charge to customers.

and of course i always look over my statements. :D
i checked my credit score about 8 months ago and was pleasantly surprised. i've never had a loan for anything, but i'm a good ways above a 750 rating. just gonna keep on doing my thing.

a general rule though. cards that gain rewards points or cash back, etc. those are the ones that usually will hit you with a high interest rate.

[1on1]

i've been trying to get a credit card but i do not have anything under my name. the only way for me to get a credit card is by a secured check card (give them $300 and that's my limit).

the only advice i know how to build credit is dont spend more than half of your limit (300, dont go over 150). i also been told that pay it off within the month so you can get a higher credit limit.

i know if i ever get a secure check card, i will probably be using it for food/gas and then pay it off by the end of the week or that same day.

a lot of people that say "dont get one" you actually need one to build up your credit. how else would you get a house or new car later in life, unless, you make loads of money.

[lucky7]

exactly.

but i think that you're only supposed to spend like 30% of your limit or something. i dunno for sure though.

[fckillerbee]

i've been trying to get a credit card but i do not have anything under my name. the only way for me to get a credit card is by a secured check card (give them $300 and that's my limit).

the only advice i know how to build credit is dont spend more than half of your limit (300, dont go over 150). i also been told that pay it off within the month so you can get a higher credit limit.

i know if i ever get a secure check card, i will probably be using it for food/gas and then pay it off by the end of the week or that same day.

a lot of people that say "dont get one" you actually need one to build up your credit. how else would you get a house or new car later in life, unless, you make loads of money.


close....

credit is built when you make purchases and pay that amount off. Credit cards that are maxed out, will only hurt your credit. The balance to get your credit score to go up, is half. So every month, if your balance on your card is less than half of the maximum limit, then the score goes up. Credit score is also determined by amount of debt vs amount available. As well as your personal expenses.

If you want your credit card to go up, max it out, pay it off. Max it out, pay it off. If you pay it off in the same month, you don't get charged interest. Never make minimum payments, as that shows banks you are hurting for money. If you do end up looking to finance anything, do it all in a 1 month timeframe, as lenders understand when you are looking for a loan, they won't take every "ding" against you when people check your credit, however someone that has more than 5 inquiries, shows lenders you are looking without researching the company. Kinda like a kid trying to buy his first car, he just applies everywhere hoping to land one.

Start little, get a credit card, make sure you pay it off everymonth, and next thing you know, the limit goes up. Just because you have a credit card, does not mean banks will finance you for cars/ houses, you need multiple cards, and maybe even a few outside purchases (jewelry, sounds system ((things that have a one time amount you can qualify for and pay off and close)).

then after two years, you can search for auto loans or purchasing a house, but anything less than two years, does not show being established.

If you have anymore questions, I can help. I worked in the auto industry for two years dealing with finance, and then had the pleasure of working the mortgage industry right when it flopped. lol.

I know things have changed in the past two years, but for the most part, I know it hasn't changed dramatically.

[g6civcx]

close....

credit is built when you make purchases and pay that amount off. Credit cards that are maxed out, will only hurt your credit. The balance to get your credit score to go up, is half. So every month, if your balance on your card is less than half of the maximum limit, then the score goes up. Credit score is also determined by amount of debt vs amount available. As well as your personal expenses.

If you want your credit card to go up, max it out, pay it off. Max it out, pay it off. If you pay it off in the same month, you don't get charged interest. Never make minimum payments, as that shows banks you are hurting for money. If you do end up looking to finance anything, do it all in a 1 month timeframe, as lenders understand when you are looking for a loan, they won't take every "ding" against you when people check your credit, however someone that has more than 5 inquiries, shows lenders you are looking without researching the company. Kinda like a kid trying to buy his first car, he just applies everywhere hoping to land one.

Start little, get a credit card, make sure you pay it off everymonth, and next thing you know, the limit goes up. Just because you have a credit card, does not mean banks will finance you for cars/ houses, you need multiple cards, and maybe even a few outside purchases (jewelry, sounds system ((things that have a one time amount you can qualify for and pay off and close)).

then after two years, you can search for auto loans or purchasing a house, but anything less than two years, does not show being established.

If you have anymore questions, I can help. I worked in the auto industry for two years dealing with finance, and then had the pleasure of working the mortgage industry right when it flopped. lol.

I know things have changed in the past two years, but for the most part, I know it hasn't changed dramatically.

I'm going to talk to you as an industry professional with all due respect so please don't take this the wrong way.


Have you actually seen the credit scoring algorithm? Not just the black box that spits out the score, but actually see how they calculate the score based on the 10 million variables or so they have on your credit report.

When you have an equation with 2 variables and an output. Changing 2 variables at the same time affects the output. If you can't see the equation, you don't know if one variable is affecting the output, or if it's the combination of both variables that causes the change in output.

Now when you do what you're saying to do, you're changing maybe 200,000-300,000 variables in a system that has over 10 million+ variables.


How can you conclusively say that doing X will affect the black box to give you Y? Do you have any extra insights or insider info that the rest of the industry doesn't have?

[SlideWell]

ive been told taking out a line of credit from your bank helps best to inscrease your credit. just my 2 cents.
my credit is fucked, i have to pay cash for everything and currently looking for a sugar momma to buy me a house.

[g6civcx]

ive been told taking out a line of credit from your bank helps best to inscrease your credit. just my 2 cents.

This is a HUGE propaganda propagated by the CC industry.

Credit rating agencies like Fair Isaac refuses to publish their credit scoring algorithm so nobody can conclusively say what is being used to calculate the credit score.

There are several cases pending in federal court that may change this practise.

[axiomatik]

When you apply for a loan, the number one thing that the lender is looking for is that you are responsible with your money, and you are responsible with your available credit. A credit report shows all of your payment history, when you opened the account, and your current balance vs your total available credit for every credit line you have/had. The lender wants to see that you pay your bills every single month, and are never late. The longer your history of paying your bills on-time, the better. They also want to see that you aren't showing signs of risky behavior.

For example, if you have 3 CC's with a total credit limit of $6000, and they look at your credit report and see that you have $5500 charged to those cards, you look risky. Why are you maxing out your cards? What happens to the debt if you lose your job?

Also, lenders look at your debt/monthly payments as a percentage of your income. If you have $6000 of debt, but you only make $18,000/yr, you look risky. It will take you a long time to pay off all the debt at your income, and if you lose your job, or some emergency comes up, you almost certainly won't be able to pay it off. When you apply for an auto loan or home loan, they will add up all of your monthly expenses and compare it to your monthly income to verify that you have enough room in your monthly budget to handle the additional payment.

It sounds like you are a responsible person, since you stated that you are terrified of debt. That is a good mentality to have, especially when it comes to credit cards. with APR's around 20%, racking up credit card debt and then making monthly payments on the debt just means that you will be throwing a lot of money away to the CC companies.

If you want to build credit with minimal risk, get a credit card, use it every month, and pay it off every month. To minimize risk, promise yourself that you will only ever use your CC to buy gas or groceries. That way you can ensure that you don't spend too much, but you will still be using it on a regular basis to build credit. Do not wait until the last minute to make the payments, pay it off as soon as you get your statement, or even earlier, to minimize the risk of late payments. Late payments are expensive, and make big dings on your credit report.

[fckillerbee]

I'm going to talk to you as an industry professional with all due respect so please don't take this the wrong way.


Have you actually seen the credit scoring algorithm? Not just the black box that spits out the score, but actually see how they calculate the score based on the 10 million variables or so they have on your credit report.

When you have an equation with 2 variables and an output. Changing 2 variables at the same time affects the output. If you can't see the equation, you don't know if one variable is affecting the output, or if it's the combination of both variables that causes the change in output.

Now when you do what you're saying to do, you're changing maybe 200,000-300,000 variables in a system that has over 10 million+ variables.


How can you conclusively say that doing X will affect the black box to give you Y? Do you have any extra insights or insider info that the rest of the industry doesn't have?


seeing the algorithm doesn't mean you have to know exactly what will happen. I am speaking from a "credit analyst" point of view. As I was the one that said...looks like your credit is too low, lets see how we can raise it 10 points to get you into your bracket, and go from there.

So no, I do not know what x+z equals...but I know if a client did this, this would result. So everything I have said is from 3 years of viewing credit reports, not just the number, but each and every revolving credit card, every chapter 7, all the little details. Things that matter. Now if I said you buy 3 cards, do what I say, and your credit score will be x...that is not the case, I am just letting the OP know that if he follows my advice, his credit score will be high. Now if he wants a perfect score, then yes, that is more in detail. And yes, I have seen a perfect score, on different occasions with different variables...as well as every creditor is different on how they score. I don't know exacts, but I do know the "just" of it.

I don't think the OP was looking for exact information....just general.

[vr4gasmtt]

You can't procrastinate with money.

If its your first credit card your not going to get much of a limit so just start somewhere.. obviously if your not making money then a credit card is not what you should even be thinking about.

It sucks, I work full time and all my paychecks go to pay off this silly credit card debt.

What do you need a credit card for again?

[iwishiwas-all*]

I don't think the OP was looking for exact information....just general.

no, he was looking for the theory to the universe, said g6civix

[saleaf]

if you have a credit union get a credit line through them. and pull a little here and there. then pay them back. or make payments. it will improve your credit making minimum payments and every time it gets paid off. Also loans like that through credit unions will have MUCH MUCH lower rates than credit cards.

[sw20>>s14]

skipped all the jargon and analysis because i think the bottom line is: PLEASE BE DAMN SURE YOURE READY FOR ONE/SOME

you should have been building years ago, but at least you know whats good for you...i must admit, it feels damn good to have great credit...no kids, bachelors, or masters yet so for now, my pride and joy is my 801 =D

[axiomatik]

if you have a credit union get a credit line through them. and pull a little here and there. then pay them back. or make payments. it will improve your credit making minimum payments and every time it gets paid off. Also loans like that through credit unions will have MUCH MUCH lower rates than credit cards.

NO NO NO! Do not "make payments". You will lose your ass on interest charges. Just paying the minimum amount due is the 2nd worst thing you could do (after paying late or not paying at all). Use the credit card, and pay it ALL off at the end of each billing cycle. This is not rocket science.

[g6civcx]

seeing the algorithm doesn't mean you have to know exactly what will happen. I am speaking from a "credit analyst" point of view.

What is a "credit analyst"? Is there a certification or something for this? How do you become one?

As I was the one that said...looks like your credit is too low, lets see how we can raise it 10 points to get you into your bracket, and go from there.

So no, I do not know what x+z equals...but I know if a client did this, this would result. So everything I have said is from 3 years of viewing credit reports, not just the number, but each and every revolving credit card, every chapter 7, all the little details. Things that matter. Now if I said you buy 3 cards, do what I say, and your credit score will be x...that is not the case, I am just letting the OP know that if he follows my advice, his credit score will be high. Now if he wants a perfect score, then yes, that is more in detail. And yes, I have seen a perfect score, on different occasions with different variables...as well as every creditor is different on how they score. I don't know exacts, but I do know the "just" of it.

I don't think the OP was looking for exact information....just general.

I see your 3 years, and multiply that by 2 or 3.

I am not saying you are atypical of the industry; everybody who works in the lending industry claims to know the way credit works by gleaning the credit report and looking at the credit score.

I am saying that this is approach is incorrect because the credit rating algorithm used by the major credit bureaus changes every day, if not every hour.

Also, each creditor also has their own in-house algorithm applied to the raw credit profiled based on the creditor's own underwriting algorithm.

The generalisations you come up, whether by your own volition or because someone else told you, were originally propagated by the credit industry to motivate people to use credit a certain way.

Their goal is to increase profits. They want you to do these things to increase profits.

There is no way to manipulate your credit score. The only thing you can do is to decrease debt as much as possible and control your spending and saving.

[g6civcx]

no, he was looking for the theory to the universe, said g6civix

You talk to me like I'm a f'ing idiot. I work with Fair Isaac almost every day trying to expose their credit rating system. They are the ones out to keep people in debt and take consumer's money.

"hegemony" is "the social, cultural, ideological, or economic influence exerted by a dominant group".

In this case, the lending industry has existed for thousands of years. Their goal is to keep people in debt. Whoever controls the money controls the world.

The American public has been bombarded with all these misconceptions that the lending industry wants you to think is true so they can manipulate your behaviour a certain way for maximum profitability.

When someone comes in with the truth, instead of looking at the facts and questioning what has been existing as fact before, you instead attack the person with the new fact that conflicts with your beliefs.


The only person you benefit by clinging on to your wrong beliefs is the CC company. You are actually hurting yourself by doing this.

[g6civcx]

When you apply for a loan, the number one thing that the lender is looking for is that you are responsible with your money, and you are responsible with your available credit

This is HUGELY incorrect. VERY VERY wrong.

I don't fault you, but this is a HUGE common misconception of the credit rating system.

The credit rating system was developed by businesses FOR businesses. This reporting was never meant for consumers.

The credit rating is used to do 2 things:

1) track your entire business profile; and
2) determine a business' potential profitability if that business were to do business with you.

Do you know what the hell is in your report? The credit agencies did not want you to know what's in the report. Do you know how much Congress had to fight to get you access to your own report? Even then the access is still not a full report.

Did you know that every company has a "black" report and a "white" report? The "white" report is what you see when you pay $39.99. There is a lso a "black" report that they never show you, yet they use it to rate you. The "black" report uses things like race, sexual orientation, disability status, etc. All these things have already been deemed by Congress to be illegal for credit rating purposes, yet these companies still use them.


The credit report does show how responsible you are with your payment, but this is not the purpose of the report. Creditors use the report to determine if you are good credit risks or not.

For most CC companies, they actually prefer you to be slightly behind on your payments. Why? So they can increase your rates, charge fees, and keep you in debt forever.

Up to 2008, mortgage lenders wanted you to have a good debt to equity ratio in the house, low income, and high debt. Why would anyone want this? Because it was more profitable to come in and foreclose on the home than to administer the loan to the end of the loan's life cycle.

It was not until recently that new mortgage underwriting guidelines force mortgage lenders to be extremely tight with their credit.

A credit report shows all of your payment history, when you opened the account, and your current balance vs your total available credit for every credit line you have/had.

True.

The lender wants to see that you pay your bills every single month, and are never late. The longer your history of paying your bills on-time, the better. They also want to see that you aren't showing signs of risky behavior.

NOT true. They want slightly risky behaviour. Clearly if you never pay your bills they will never make any money from you. For unsecured debt this is not good, but for collateralised debt it may be good if they can repo the asset and make money off of the deal.

If you are too clean and always pay your bills on time, only conservative lenders will do business with you because they want you to stick to the payment schedule.

Most lenders want you to stray a little bit but still pay in the end so they can still get all the money and a little bit more in late fees and higher interest.

If you want to build credit with minimal risk, get a credit card, use it every month, and pay it off every month. To minimize risk, promise yourself that you will only ever use your CC to buy gas or groceries. That way you can ensure that you don't spend too much, but you will still be using it on a regular basis to build credit. Do not wait until the last minute to make the payments, pay it off as soon as you get your statement, or even earlier, to minimize the risk of late payments. Late payments are expensive, and make big dings on your credit report.

I strongly disagree. The best way to build your credit is to not give a s*t about your credit.


OP, this is what I recommend you do:

Increase your income as much as possible. Decrease your spending and debt as much as possible. Save as much as possible.

Do not use credit if at all possible. When you do need credit, use credit sparingly and pay off everything as soon as possible.

Do not give money to CC companies just to feel like you're building your credit. This is folklore and you're playing right into their hands.

[g6civcx]

NO NO NO! Do not "make payments". You will lose your ass on interest charges. Just paying the minimum amount due is the 2nd worst thing you could do (after paying late or not paying at all). Use the credit card, and pay it ALL off at the end of each billing cycle. This is not rocket science.

I'm going to agree with you here, not because it's good for your credit score but because it's good for you in general.

[DALAZ_68]

so is it also folk lore that closing a line a credit (not just tearing ur card apart but actually calling the company to cancel ur card) once payments are complete a bad thing?

because i have 2 very useless credit cards that have been payed off for over a yr i just wanna stop worrying about... i never use them nor carry them...i dont even have the cards, but the fear of forgetting about those two and someone id thefting my shit and me none the wiser...scary

[g6civcx]

so is it also folk lore that closing a line a credit (not just tearing ur card apart but actually calling the company to cancel ur card) once payments are complete a bad thing?

because i have 2 very useless credit cards that have been payed off for over a yr i just wanna stop worrying about... i never use them nor carry them...i dont even have the cards, but the fear of forgetting about those two and someone id thefting my shit and me none the wiser...scary

It may be "bad" for the creditor since they can no longer profit from you. They will re-rate your credit profile and ding you accordingly.

But personally, I think it's absolutely best if you can close all of your credit lines that you don't need. There's no reason to keep an open balance just for the sake of proving creditworthiness.

Keep in mind that CC companies are starting to charge you inactivity fees and maintenance/annual fees. So even if you don't use your card you can still get charged for keeping an open balance.


You also leave yourself prone to CC theft if you have an inactive account. If you don't check the transactions regularly, something may get charged and you may not even find out in a timely manner.


Also keep in mind that having accessible credit is not a good thing. It shows that you can go out and get yourself into debt very quickly. Lenders also considers how easy it is for you to rack up debt if you decide to go crazy one day and max out all your cards on car parts.


There are pros and cons to either way, but I recommend closing all accounts that you don't need. Forget what the credit report say. Do it for yourself.

[TougeLove]

there is quite a bit of info on here already, all i can say is. check your card every other day or so. make sure you remember when your due date is EVERY MONTH. it may change on you.

also pay early early early. certain things happen and if you can afford to pay it early do so.

p.s. jewelry purchases are INCREDIBLE for your credit score. they usually report the fastest. so buy your mom/gf/fiance/fav actress a diamond and pay it off pretty quick.

oh and if you goto a credit score website make sure its not one that shows an inquire everytime you check it. i as well as other financial friends of mine use truecredit.com they are pretty legit and its only 15$ a month, no bs and LOTS of good useful info.

[saleaf]

I agree making payment on anything like a credit card or personal loan for a long period of time is not the best thing for you. But its the best thing for your credit. Make payments for about 3 or 4 month on what you have borrowed then pay it off. it will improve your credit faster that way.

[fckillerbee]

im in the market and looking to get a credit card. i never had credit card ever since ive been building my car. i pay cash everything i purchased. so im really proud that im not in big debt. im trying to get one so i can get started building my credit line for buying a house in the future.the question is i dont know stuff about them and i really need an insight what i need to check and look, which company are good to start with or avoiding. i know most of the members here had ups and downs with credit card, hoping u can share your experience with me.

thanks

so what you are telling me, does not answer this simple question that I am trying to solve for this man.

I understand you are working in that market, and there are "equations" for everything. But if this man is asking simple advice on how to get the best credit score....what you are telling him is incorrect. You are telling him how to stay out of debt and avoid getting a credit score at all.

Yes a profitable lender does like to see people make payments, and not pay everything off. At the same time, people that pay everything off, are not at risk, when they are not at risk, they are the MOST likely to get a loan for a house or a car.

Of course the industry is in business to make money, if they weren't making money, we wouldn't be so gun hoe about credit scores. In my opinion, how can you judge a human on previous experiences when they could be on a great path now. I am one of those cases. None the less, you are still not answering the question at hand.

I am not arguing with you saying you are wrong, I'm arguing the fact that what you are telling him, is not in any way going to build his credit, or make his credit a perfect score. So please, before you insult myself at reading credit reports, and speaking with lenders regarding decisions to finance, make sure you know what subject you are talking about.

As for the idiot saying charge shit up, and slowly make payments...that is good for the bank, but if you are looking to buy a house, clean is always the best.

Only keep a few credit cards, don't cancel them, as they will affect your available credit to debt ratio. Like I said, go buy some jewelry for the mrs, get a personal loan, pay all that shit off, and it will go up. Keep you cards under 50% credit limit at the least, but if you can pay them off, do so( and yes, I am aware of the gov. making this so people have to buy shit to build credit, it's a fucking catch 22 imo). Before you go out and get a card, research the company, research the loan, just dont go giving your ss# out, trying to finance everything in the world.


And for the fucking record, I don't know the algorithm. But I know I am not wrong with what I say. This will bring your credit up, how much, I don't know, when, I don't know.

and please, don't let people check your credit...when they "check" they run it....as "soft" or "hard" as it may be, your credit has an inquiry.

[sw20>>s14]

oh and if you goto a credit score website make sure its not one that shows an inquire everytime you check it.



and please, don't let people check your credit...when they "check" they run it....as "soft" or "hard" as it may be, your credit has an inquiry.

can you guys elaborate on this?

[Bricksquad1017]

if youre billed 75 dollars send them a 100 it builds youre credit

[nissan240]

you should give americn express a try. i got the zync from amex. and my apr is 2.9% but my credit score is pretty damn good and have 100000 credit limit(downfall is that you have to pay a annual fee). heres is what i learned on how to get a good credit score. use your credit card only 30% of what the card is maxed out at. for example if you have a 100 dollar credit limit on your credit card use only 30% of what the card is maxed out at. pay it off completly every month so there wont be any intrest rate, it shows that you can maintain your bills. if you do have to spend a little more then go ahead and try to pay off as quickly as possible 1 because it will look better on your end and 2 you'll end up saving more money in the end rather than having to pay more for it. im just giving you a quick run down and i didnt read other post so they may have mentioned it already. :D

[g6civcx]

so what you are telling me, does not answer this simple question that I am trying to solve for this man.

I understand you are working in that market, and there are "equations" for everything. But if this man is asking simple advice on how to get the best credit score....what you are telling him is incorrect. You are telling him how to stay out of debt and avoid getting a credit score at all.

Your statement is incorrect.

He asks about "building my credit line for buying a house in the future". He is not asking about a credit score. You can reread the question. Nowhere does he even mention a "credit score".

You are saying "credit score = creditworthiness".

I am saying "responsible finances = creditworthiness".

Do you see the difference?

Yes a profitable lender does like to see people make payments, and not pay everything off. At the same time, people that pay everything off, are not at risk, when they are not at risk, they are the MOST likely to get a loan for a house or a car.

Incorrect. This is a HUGE misconception. Even industry professionals get this point wrong so I do not fault you. You don't have to get so defensive.


Each lender has a set of underwriting criteria. The underwriter uses your full credit profile to generate a credit decision based on your credit profile.

Not every mortgage lender wants a low-risk borrower. Most mortgage lenders actually want medium-risk borrowers.


While I do not want to comment on how each lenders underwrites, I submit the following as evidence of my knowledge of the industry.


Each lender has different cost to capital. Some lenders get capital really cheaply (e.g. pension funds, bonds, etc.) and some lenders have really high cost of capital (e.g. securitised interests, high interest loans, etc.)

Based on the cost to capital and risk aversion profile, each lender prefers a slightly different mixture of customers. Highly leveraged lenders will need higher risk customers to give them more interest returns with more risk.

Low risk lenders prefer low risk customers with fixed interest returns with low risk.

Most lender has a portfolio mix of both kinds of customers.


Based on the lender's own target profile captured in the underwriting guidelines, the lender will go out and seek customers that match this target profile. High risk lenders look for high risk customers. Low risk lenders look for low risk customers.

Based on the customer's raw credit profile (both "white" and "black" reports), each lender runs its own underwriting algorithm to determine if the customer fits its own target profile.

The result is a form of internal credit scoring. Each lender's scoring of a customer predicts how well the customer meets the lender's target customer profile.


The credit score offered by TUC, EXP, and EQU are generic credit scores used to predict general business profitability. These credit scores are not specific to mortgage underwriting. Changing this credit score may or may not affect mortgage underwriting.


In order to manipulate your credit worthiness for mortgage, you need to know how the individual lender is rating your credit profile. You also need to know what the Fannie Mae and Freddie Mac underwriting guideline is for that day.

These things change every day, if not every hour. Therefore, it would be impossible for you to chase down different criteria from different lenders to improve your credit worthiness.


Of course the industry is in business to make money, if they weren't making money, we wouldn't be so gun hoe about credit scores. In my opinion, how can you judge a human on previous experiences when they could be on a great path now. I am one of those cases. None the less, you are still not answering the question at hand.

The question at hand is credit worthiness, not credit score.

I am not arguing with you saying you are wrong, I'm arguing the fact that what you are telling him, is not in any way going to build his credit, or make his credit a perfect score

Doing what I am telling him (as of TODAY), is in fact perfect compliance with the revised Fannie Mae and Freddie Mac underwriting criteria as required by the Obama administration. They want you to have high income, high savings, no debt, and no open credit accounts.

The generic credit score is immaterial to this underwriting guideline.

In fact, there is a push in the US government to move away from using consumer credit reporting to rate mortgage underwriting. Did you know that?

So please, before you insult myself at reading credit reports, and speaking with lenders regarding decisions to finance, make sure you know what subject you are talking about

At no point did I insult you or your ability to read a credit report. I make it a point NEVER to insult the person. I only attack the argument, not the person. Attacking what you say and attacking you are different things. If I attacked you personally then I violated forum rules and the mods need to punish me. Please point out where I insulted you.

As for my personal knowledge, I submit the following for your consideration:

* I graduated from one of the top ten business school in the US according to US News and World Report. My major was in corporate management.
* I have worked in the finance industry for close to 10 years.
* I have served as an expert witness for the US Department of Commerce on economic issues for almost 5 years.
* President Obama personally invited me to meet with him in the West Wing to avise him about the mortgage and credit card industry. I have appeared in numerous network TV coverages with him promoting his Making Homes Affordable program.
* I have worked with the top mortgage lenders in the country, e.g. Wells Fargo, BoA, etc.
* I have struggled with Fair Isaac for many years about their credit rating system.

Since you made this pesonal, now I turn to you.

You have not claimed to be an underwriter or statistic acturian employed or experienced in the mortgage lending industry.

Are you any of these? What is your actual experience in the mortgage lending industry? What is your educational background?

You said you are a "credit analyst" and you have examined many credit reports. What exactly do you do with these reports? Do you make lending decisions yourself, or do you just forward the report to the underwriter for final decision on creditworthiness?

What did you do in the auto industry? Are you a loan officer? salesperson? secretary? mail room clerk?

Where did you learn your knowledge of how auto and mortgage underwriting works?

As for the idiot saying charge shit up, and slowly make payments...that is good for the bank, but if you are looking to buy a house, clean is always the best.

I strongly agree with this statement.

Only keep a few credit cards, don't cancel them, as they will affect your available credit to debt ratio. Like I said, go buy some jewelry for the mrs, get a personal loan, pay all that shit off, and it will go up. Keep you cards under 50% credit limit at the least, but if you can pay them off, do so( and yes, I am aware of the gov. making this so people have to buy shit to build credit, it's a fucking catch 22 imo). Before you go out and get a card, research the company, research the loan, just dont go giving your ss# out, trying to finance everything in the world.

I strongly disagree with this statement for all the reasons I stated in the posts above.

And for the fucking record, I don't know the algorithm. But I know I am not wrong with what I say. This will bring your credit up, how much, I don't know, when, I don't know.

You do not know how much, and you do not know when, but you do know doing X will increase your credit score. You just don't know how much or when.

Then it can be logical to say that doing X can net you a 1 point increase 100 years from now.

Clearly this is not worth the effort.

You said any amount any time. Don't look at me.


Did you know about this? These rules are about to go into effect in 2 months. The new rules are meant to specifically stop the cycle of spend and pay off that was in use by the industry to artificially boost credit scores.

https://www.efanniemae.com/sf/refmaterials/prodmortcodes/

[g6civcx]

Everyone, please read this link: Building a Better Credit Report (http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre03.shtm)

[g6civcx]

can you guys elaborate on this?

When someone request a copy of your credit report, the inquiry is recorded in your credit report.

Each rating agency and lender is different, but usually having too many inquiries show that you are actively seeking credit and suggests that you may be getting in over your head.

It takes time to open a credit account. If you went out and took 10 mortgages, it would take about a month for those accounts to show up on your credit report. By then you would be overleveraged and it's too late.

The credit inquiries show up more quickly so lenders can see what you are trying to do.


2 ways to solve this problem:

1. Do a consumer-initiated inquiry. This doesn't show up as a lender initiated inquiry. It just means you are checking your own report for errors.

2. Do all your shopping in a short period of time, preferably within 2 or 3 months at most. The lender should recognise that you are shopping for rates and should not give you problems.

Does this answer your question?

[TougeLove]

^ a friend of mine who works at a dealer also told me it can give you a ten point deduction when your credit score is checked without using a consumer-initiated inquiry.

[TheWolf]

I will put this in here for a more macroeconomic perspective.

Do not forget the golden rule.

"He who has the gold. Makes the Rules!"

Like he said. Each bank has different algorithms. Most people don't realize also not everywhere is a bank. Sometimes these buildings look like banks, smell like banks, have people in them like banks but they're really banking centers. Like the raceon aero of banks. Places like BoA, Wachovia, etc. These people are drones. They can not help you unless their computer allows them to. They will tell you about some awesome rate and how they can save you money. They read the brochure 5 minutes before you did. Their goal is to get x peoples signed up for the following things per week. Think of them like car dealer salespeople. It's their job to be pushy, and attempt to sign you up for something that isn't in your best interests.

A local bank is different. I can not underestimate the importance of having a relationship with your local bank. If you can't walk in and the tellers all don't know your name, if you're not on a first name basis with the manager. You don't have a relationship. They look out for me and only advise financial products that could help me. Local credit unions are great for this. They usually have some of the most competitive rates and actually use factors like length of time you've been a customer and account standing. etc.

If you've got 20-30k in the bank, you will be surprised at how they change their attitude towards you. If you've slowly over 6 years acquired a large amount of cash for a house and now have a 10-20% deposit on hand, they'll write you no problem. First learn to save large amount of money. This is counter intuitive to the planet, the gov't, and the credit score program. They all want you to spend large amounts of money then think of how you're going to "save" it later. You will be wealthy in life if you learn and master the ability to save.

If you're just trying to boost your score because next year your gonna marry your GF and you want to put 3% down on a VA Loan and want to get a swank new pad then do the world a favor and don't do it.

[g6civcx]

I will put this in here for a more macroeconomic perspective.

Do not forget the golden rule.

"He who has the gold. Makes the Rules!"

Like he said. Each bank has different algorithms. Most people don't realize also not everywhere is a bank. Sometimes these buildings look like banks, smell like banks, have people in them like banks but they're really banking centers. Like the raceon aero of banks. Places like BoA, Wachovia, etc. These people are drones. They can not help you unless their computer allows them to. They will tell you about some awesome rate and how they can save you money. They read the brochure 5 minutes before you did. Their goal is to get x peoples signed up for the following things per week. Think of them like car dealer salespeople. It's their job to be pushy, and attempt to sign you up for something that isn't in your best interests.

A local bank is different. I can not underestimate the importance of having a relationship with your local bank. If you can't walk in and the tellers all don't know your name, if you're not on a first name basis with the manager. You don't have a relationship. They look out for me and only advise financial products that could help me. Local credit unions are great for this. They usually have some of the most competitive rates and actually use factors like length of time you've been a customer and account standing. etc.

If you've got 20-30k in the bank, you will be surprised at how they change their attitude towards you. If you've slowly over 6 years acquired a large amount of cash for a house and now have a 10-20% deposit on hand, they'll write you no problem. First learn to save large amount of money. This is counter intuitive to the planet, the gov't, and the credit score program. They all want you to spend large amounts of money then think of how you're going to "save" it later. You will be wealthy in life if you learn and master the ability to save.

If you're just trying to boost your score because next year your gonna marry your GF and you want to put 3% down on a VA Loan and want to get a swank new pad then do the world a favor and don't do it.

Thank you for your comments. It reeks of fair reasoning and balanced mind :drool:

[g6civcx]

OP, I am so sorry for all the BS. There is a lot of bad info floating around.

This is my recommendation for you, in order of importance:

1. Increase your legal income as much as possible.
2. Decrease your spending as much as possible.
3. Increase your savings as much as possible.
4. For things that you absolutely need to buy, use cash if at all possible.
5. Use credit sparingly. Avoid opening credit accounts if at all possible. It's ok to have 1-2 accounts, but save your credit card for emergency situations ONLY.
6. Check your credit report at least annually: The Federal Trade Commission's Information on Free Annual Credit Reports (http://www.ftc.gov/freereports)

Read your entire report carefully. If there are any problems at all, follow these guidelines to fix them: Building a Better Credit Report (http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre03.shtm)


If you do all these things correctly, you will be able to get a good mortgage with no problems. Good luck.

[g6civcx]

For everyone who already has a home but are in over their head and don't know what to do, go here: Making Home Affordable - Home (http://makinghomeaffordable.gov/)

You can call the hotline and a representative from HUD can help you for free.

[axiomatik]

This is HUGELY incorrect. VERY VERY wrong.

I don't fault you, but this is a HUGE common misconception of the credit rating system.

The credit rating system was developed by businesses FOR businesses. This reporting was never meant for consumers.

The credit rating is used to do 2 things:

1) track your entire business profile; and
2) determine a business' potential profitability if that business were to do business with you.

This does not contradict what I was saying. I know this. The original purpose of credit reports and credit scoring was as a tool for lenders to determine risk. Lenders do not want to lose money on loan defaults. So the credit reporting system was developed as a way to track people's credit history to determine if they had a history of paying off their loans or defaulting (I'm simplifying here, that's the gist of it. Over the years, the Credit Report system has changed and evolved, and now it is being used in more sophisticated ways as you mentioned, such as predicting how profitable a person will be to a credit card company). It was a tool created for businesses by business. However, because of how important the credit report is to people's finances, you need to keep track of what is on your credit report.



The credit report does show how responsible you are with your payment, but this is not the purpose of the report. Creditors use the report to determine if you are good credit risks or not.

For most CC companies, they actually prefer you to be slightly behind on your payments. Why? So they can increase your rates, charge fees, and keep you in debt forever.

You are confusing the issue here. This thread is not concerned about what credit card issuers want. Credit card issuers want nothing more than for people to rack up a few thousand dollars in debt, and then make modest payments on that debt for years. That is how they make billions of dollars. What is even better for the credit card company is for you to be late on a payment every once in a while. Then they can jack your APR even higher and charge you large fees too. That is why they call customers like me "deadbeats". Just about everything I buy goes on my AmEx. But at the end of every month I pay off the entire balance. American Express never gets a single cent from me in interest or fees while I get 1-3% cash back on every dollar I spend. But this is beside the point. The OP was asking about getting a mortgage.

Up to 2008, mortgage lenders wanted you to have a good debt to equity ratio in the house, low income, and high debt. Why would anyone want this? Because it was more profitable to come in and foreclose on the home than to administer the loan to the end of the loan's life cycle.

It was not until recently that new mortgage underwriting guidelines force mortgage lenders to be extremely tight with their credit.

I find it very hard to believe that there were many lenders out there that would prefer to foreclose on your house than have you make payments over the lifetime of the loan. It was only for 5 years or so that home prices were rocketing unusually. Prior to 2002, home prices were certainly not rising fast enough to justify foreclosing. It is an expensive, drawn-out process foreclosing on a house, and a house is not a liquid asset. A bank holding a foreclosed house is subject to the whims of the housing market and waiting for the right buyer coming along to actually buy it. To a bank, a house is a worthless asset until someone actually buys it. In fact, it can be an asset that rapidly loses value if it is vandalized while sitting vacant.

Besides that fact, most lenders won't even hold on to your loan for the duration anymore. Most likely your loan will be sold to some other financial institution.


NOT true. They want slightly risky behaviour. Clearly if you never pay your bills they will never make any money from you. For unsecured debt this is not good, but for collateralised debt it may be good if they can repo the asset and make money off of the deal.

It sounds like you are talking about credit card issuers again. That is not the subject of this thread.


OP, this is what I recommend you do:

Increase your income as much as possible. Decrease your spending and debt as much as possible. Save as much as possible.

Do not use credit if at all possible. When you do need credit, use credit sparingly and pay off everything as soon as possible.

Do not give money to CC companies just to feel like you're building your credit. This is folklore and you're playing right into their hands.

Good advice. However, it generally isn't that easy for people to just increase their income. Slanging parts on the side can help you pay down debt, but when it comes time to apply for a mortgage, the lender is going to look at your paychecks and W-2's, your 'official' income.

This is what it comes down to. When you apply for a mortgage, the lender is going to collect a bunch of information, including paychecks, bank statements, investment account statements, 401k statements, W-2's (possibly mutliple year's worth), credit reports, credit scores. A loan officer is going to review all of the information and determine whether or not you are a safe investment or risky investment. They will have some sort of computer system that takes all the data and spits out either a 'definite no' (you most definitely do not meet the qualifications), 'maybe' or 'yes' (again, I'm simplifying).

But in the end, a loan officer is going to make the decision on whether or not to issue you a loan. They will be checking to see if you have enough assets for the purchase. If you have a stable employment history. If your earnings history is sufficient for the loan. How much debt you have. What monthly payments do you have. Do you pay your bills on time. What is your credit score.

Your credit score is a black box. There is no magical action you can take that will bump you up to an 800. It is a complex system with many variables, looking at lots of data, going back for years. If you have had a bad habit of making late payments for years, going out a buying a necklace isn't going to erase all that history.

However, if you've never had a CC, never had a loan, have little to no payment history, you are going to look somewhat risky just because there is not enough data to determine what kind of borrower you are. That is why I suggested getting one CC and using it to buy groceries. Do not accumulate any debt on it. Pay it off every month, on time, and you will build a history of on-time payments in your credit report.

[g6civcx]

This does not contradict what I was saying. I know this. The original purpose of credit reports and credit scoring was as a tool for lenders to determine risk.

Actually the first formal "credit report" came out somewhere around the turn of the 19th - 20th century as an actuarial predictor of insurance risk.

Somewhere around the late 40s lenders started using formal credit reports in the manner close to what they do now.

Pardon me if the dates are not accurate, but these practices were not publicly released and this is just my estimate based on the published literature.


Lenders do not want to lose money on loan defaults

Actually, some lenders do want you to default. If they make more money by seizing the securitised collateral, they want you to default. Lenders don't really care what happens as long as they make the most profits.

So the credit reporting system was developed as a way to track people's credit history to determine if they had a history of paying off their loans or defaulting (I'm simplifying here, that's the gist of it. Over the years, the Credit Report system has changed and evolved, and now it is being used in more sophisticated ways as you mentioned, such as predicting how profitable a person will be to a credit card company).

Not quite an accurate portrayal of my statement but fair enough. Let's say it's good.

It was a tool created for businesses by business. However, because of how important the credit report is to people's finances, you need to keep track of what is on your credit report.

I agree 100%.

You are confusing the issue here. This thread is not concerned about what credit card issuers want. Credit card issuers want nothing more than for people to rack up a few thousand dollars in debt, and then make modest payments on that debt for years. That is how they make billions of dollars. What is even better for the credit card company is for you to be late on a payment every once in a while. Then they can jack your APR even higher and charge you large fees too. That is why they call customers like me "deadbeats". Just about everything I buy goes on my AmEx. But at the end of every month I pay off the entire balance. American Express never gets a single cent from me in interest or fees while I get 1-3% cash back on every dollar I spend. But this is beside the point. The OP was asking about getting a mortgage.

You are 100% correct. I was commenting on the other poster's advice to rack up CC debt.

I am sorry that we got off track.


I find it very hard to believe that there were many lenders out there that would prefer to foreclose on your house than have you make payments over the lifetime of the loan. It was only for 5 years or so that home prices were rocketing unusually. Prior to 2002, home prices were certainly not rising fast enough to justify foreclosing. It is an expensive, drawn-out process foreclosing on a house, and a house is not a liquid asset. A bank holding a foreclosed house is subject to the whims of the housing market and waiting for the right buyer coming along to actually buy it. To a bank, a house is a worthless asset until someone actually buys it. In fact, it can be an asset that rapidly loses value if it is vandalized while sitting vacant.

Because of appreciating assets, the loan-to-value ratio will increase after the loan is administered. As the value continues to climb, there is more and more incentive to foreclose on the home, or at least repackage the loan (toxic assets as we know it) at a premium.

Besides that fact, most lenders won't even hold on to your loan for the duration anymore. Most likely your loan will be sold to some other financial institution.

True.

It sounds like you are talking about credit card issuers again. That is not the subject of this thread.

You are correct.

Good advice. However, it generally isn't that easy for people to just increase their income. Slanging parts on the side can help you pay down debt, but when it comes time to apply for a mortgage, the lender is going to look at your paychecks and W-2's, your 'official' income.

Actually according to current Fannie Mae and Freddie Mac guidelines, the down payment is more important than income.

This is because income can be lost at any time very easily. The recession has taught us this.

Savings is more valuable because the loan-to-value ratio being low allows the lender to do a loan modification program to help the borrower in distress.

If you put no or little money down, you don't have any equity in the home and most likely will walk away resulting in foreclosure.

This is what it comes down to. When you apply for a mortgage, the lender is going to collect a bunch of information, including paychecks, bank statements, investment account statements, 401k statements, W-2's (possibly mutliple year's worth), credit reports, credit scores.

True.

A loan officer is going to review all of the information and determine whether or not you are a safe investment or risky investment. They will have some sort of computer system that takes all the data and spits out either a 'definite no' (you most definitely do not meet the qualifications), 'maybe' or 'yes' (again, I'm simplifying).

But in the end, a loan officer is going to make the decision on whether or not to issue you a loan. They will be checking to see if you have enough assets for the purchase. If you have a stable employment history. If your earnings history is sufficient for the loan. How much debt you have. What monthly payments do you have. Do you pay your bills on time. What is your credit score.

This is incorrect. The loan officer doesn't decide anything. The loan underwriter determines to fund the loan or not.

Loan officers are paid by commissions based on the number and amounts of loans they close. The loan officer's incentive is to close as many loans at as high an interest rate as possible.

Loan officers typically do nothing more than data collection and customer service duties. The heavy lifting is done by the lender's underwriting department.

Your credit score is a black box. There is no magical action you can take that will bump you up to an 800. It is a complex system with many variables, looking at lots of data, going back for years. If you have had a bad habit of making late payments for years, going out a buying a necklace isn't going to erase all that history.

Yes. Thank you for understanding.

However, if you've never had a CC, never had a loan, have little to no payment history, you are going to look somewhat risky just because there is not enough data to determine what kind of borrower you are. That is why I suggested getting one CC and using it to buy groceries. Do not accumulate any debt on it. Pay it off every month, on time, and you will build a history of on-time payments in your credit report.

This is not true any more. Nowadays the mortgage lenders actually prefer no credit history over buy and pay off.

You may actually get hit with an "over-reliance on revolving credit" flag, which means that the lender thinks you are not managing your cashflow efficiently and you are using credit to cover your shortfalls.

Paying off the balance monthly doesn't help you in this case.

[fckillerbee]

Actually the first formal "credit report" came out somewhere around the turn of the 19th - 20th century as an actuarial predictor of insurance risk.

Somewhere around the late 40s lenders started using formal credit reports in the manner close to what they do now.

Pardon me if the dates are not accurate, but these practices were not publicly released and this is just my estimate based on the published literature.




Actually, some lenders do want you to default. If they make more money by seizing the securitised collateral, they want you to default. Lenders don't really care what happens as long as they make the most profits.



Not quite an accurate portrayal of my statement but fair enough. Let's say it's good.



I agree 100%.



You are 100% correct. I was commenting on the other poster's advice to rack up CC debt.

I am sorry that we got off track.




Because of appreciating assets, the loan-to-value ratio will increase after the loan is administered. As the value continues to climb, there is more and more incentive to foreclose on the home, or at least repackage the loan (toxic assets as we know it) at a premium.



True.



You are correct.



Actually according to current Fannie Mae and Freddie Mac guidelines, the down payment is more important than income.

This is because income can be lost at any time very easily. The recession has taught us this.

Savings is more valuable because the loan-to-value ratio being low allows the lender to do a loan modification program to help the borrower in distress.

If you put no or little money down, you don't have any equity in the home and most likely will walk away resulting in foreclosure.



True.



This is incorrect. The loan officer doesn't decide anything. The loan underwriter determines to fund the loan or not.

Loan officers are paid by commissions based on the number and amounts of loans they close. The loan officer's incentive is to close as many loans at as high an interest rate as possible.

Loan officers typically do nothing more than data collection and customer service duties. The heavy lifting is done by the lender's underwriting department.



Yes. Thank you for understanding.



This is not true any more. Nowadays the mortgage lenders actually prefer no credit history over buy and pay off.

You may actually get hit with an "over-reliance on revolving credit" flag, which means that the lender thinks you are not managing your cashflow efficiently and you are using credit to cover your shortfalls.

Paying off the balance monthly doesn't help you in this case.


wow....everything you have talked about has been different then what I was taught only a couple years ago.

and just so you are a little clearer, a loan officer just places the order, finds which lender is best based upon their knowledge, and negotiate with the underwriter for better interest, more on the back end, etc. Their job is not to get the highest interest rate, but make the most money out of it whether it be on the front side of the loan or on the back side of the loan.

That is exactly why I got out of a fucked up industry, because I was seeing people get raped by the mortgage company I worked for, and I couldn't see any honesty in it....it was all in who you know, and how much you make, whether you are hurting people or not.

I was that loan officer, and when i was in the auto industry looking at what is now completely different applications according to the new fannie may and freddie mac guidelines, I was always trying to negotiate with the underwriters trying to get people financed.

It's not that I was the underwriter, but I more so picked and chose lenders based upon their guidelines, kinda like bofa prefers prime borrowers, with revolving credit being a plus, and wells fargo is sub prime preferring that you just had credit. Keep in mind, this was 3-4 years ago, so it looks like the whole criteria is now changed.

So now I have a question for you, since I am no longer useful information....What are they going to do about the whole bk's staying on your credit for 7-11 years? Same thing with people who default on credit cards...I remember at the time, if someone defaulted on a card, correct me if i'm wrong, but in 7 years, it would no longer be on your fico? Unless the bank went back into their records, and requested that to be on your credit score...same goes for collections. Or has that changed? I remember hearing something about bk's changing, people now have to accept responsibility, and man up for their bail out....I think I might have heard that on the radio.

Keep the good information coming, like I said, I WAS very knowledgeable when I was in the industry, but it looks like it really has taken a 360 since obama has been in business.....i mean president.

[g6civcx]

wow....everything you have talked about has been different then what I was taught only a couple years ago.

There has been so much change in the industry since 2008 that even long established companies are having to revamp their entire system.

and just so you are a little clearer, a loan officer just places the order, finds which lender is best based upon their knowledge, and negotiate with the underwriter for better interest, more on the back end, etc. Their job is not to get the highest interest rate, but make the most money out of it whether it be on the front side of the loan or on the back side of the loan.

You are 100% correct. Commissions can be based on interest rate, where lenders pay higher commissions to the loan officer to push higher interest rate loans, but yes you are correct. Whatever makes the most money is the way to go for the loan officer. Sometimes it's high interest rate. Sometimes it's not.

That is exactly why I got out of a fucked up industry, because I was seeing people get raped by the mortgage company I worked for, and I couldn't see any honesty in it....it was all in who you know, and how much you make, whether you are hurting people or not.

I was that loan officer, and when i was in the auto industry looking at what is now completely different applications according to the new fannie may and freddie mac guidelines, I was always trying to negotiate with the underwriters trying to get people financed.

It's not that I was the underwriter, but I more so picked and chose lenders based upon their guidelines, kinda like bofa prefers prime borrowers, with revolving credit being a plus, and wells fargo is sub prime preferring that you just had credit. Keep in mind, this was 3-4 years ago, so it looks like the whole criteria is now changed.

The best you could have done is to shop around for the borrower. You can try to negotiate but you're really at the mercy of the lender and whatever loan package they decide to give you.

So now I have a question for you, since I am no longer useful information....What are they going to do about the whole bk's staying on your credit for 7-11 years? Same thing with people who default on credit cards...I remember at the time, if someone defaulted on a card, correct me if i'm wrong, but in 7 years, it would no longer be on your fico? Unless the bank went back into their records, and requested that to be on your credit score...same goes for collections. Or has that changed? I remember hearing something about bk's changing, people now have to accept responsibility, and man up for their bail out....I think I might have heard that on the radio.

All of that is really beyond what the government is currently requiring. Keep in mind that credit rating agencies have NOT been regulated very much. This is slowly changing, but as of right now, the credit bureaus can still do whatever they want with your derogatory items.

Also keep in mind that these items never really come off your report. They store everything forever. They just take it off your "white" credit report, but once they have the data, it stays forever in their "black" credit report.

We don't really have any idea what's going on because both the data and the algorithm are not published. The credit agencies are fighting this really aggressively so it may not be for a long time until we really know what is actually contained in our full credit report.

Keep the good information coming, like I said, I WAS very knowledgeable when I was in the industry, but it looks like it really has taken a 360 since obama has been in business.....i mean president.

I don't mean any personal attacks on you. I work mostly on the policy side. We still need your experience on the administration side.

Please keep your helpful comments coming.

[fckillerbee]

So do we atleast know who has access to this algorithm...i mean someone has to have control over it. Wouldn't it be as simple as working for experian....all though..i have tried to get in contact with experian...and that was virtually impossible.

[g6civcx]

So do we atleast know who has access to this algorithm...i mean someone has to have control over it. Wouldn't it be as simple as working for experian....all though..i have tried to get in contact with experian...and that was virtually impossible.

The way the law currently works, the algorithm and the data itself are protected trade secrets. This means that EXP owns the data and the algorithm. No one has access to these things other than EXP.

Even if you worked for EXP you wouldn't get access unless you were th

I have a major problem with this.

In the US, we have the right to confront our accusors and view the evidence presented against us.

The credit profile is a way to determine your business "reputation"; it's used to see if I should do business with you or not.


When the process to determine my business reputation is not transparent and I'm being rated unfairly, it's like you're convicted of a crime without seeing any evidence.