• reddig33@lemmy.world
    link
    fedilink
    arrow-up
    26
    arrow-down
    1
    ·
    1 year ago

    And whose fault is that? Maybe banks shouldn’t approve credit card debt to people who can’t pay it.

    • Z3k3@lemmy.world
      link
      fedilink
      English
      arrow-up
      47
      arrow-down
      1
      ·
      1 year ago

      The whole credit system is a scam.

      I was lucky enough to pay off my mortgage a few months ago due to the money saved working from home going to that since the 1st lock downs

      What happened my credit score instantly went down.

      • Chainweasel@lemmy.world
        link
        fedilink
        English
        arrow-up
        16
        arrow-down
        1
        ·
        1 year ago

        You’re credit score isn’t about how good you are at making payments, it’s about how good you are at generating interest for your creditors.

      • partial_accumen@lemmy.world
        link
        fedilink
        arrow-up
        7
        arrow-down
        1
        ·
        1 year ago

        What happened my credit score instantly went down.

        Your credit score is just an up-to-date test of how good you are at servicing debt. If you paid off all your debt, then no one knows if you’re still good at servicing debt. For all they know you could have a $2k/week cocaine habit after paying off your mortgage and all your cash flow goes up your nose.

        Since you’re not paying on any debt today you’re not as good a credit risk.

      • SatanicNotMessianic@lemmy.ml
        link
        fedilink
        arrow-up
        4
        ·
        1 year ago

        Not justifying the algorithms or even the agencies, but in general your credit score reflects things like onetime payments and the balances you carry relative to your outstanding credit limits. Paying off a loan closes an account, so by the formula you’re changing your open accounts. This is going to result in a temporary dip.

        It’s annoying, it’s stupid, it’s not reflective of someone’s ability to manage debt (which is what a credit score should reflect), and if anything should be positive. The two things to remember are that it’s a temporary dip and your score will go back up without you doing anything differently, and that you do not need an 850 to get the best deals. Anything above 750 or whatever their top tier starting point is gets the same rate.

        • ShittyRedditWasBetter@lemmy.world
          link
          fedilink
          arrow-up
          2
          arrow-down
          4
          ·
          edit-2
          1 year ago

          People bitching about this really just want to bitch and don’t have any clue how lending actually works. My score dropped 1.5%? Literally slavery!!!

      • ShittyRedditWasBetter@lemmy.world
        link
        fedilink
        arrow-up
        1
        arrow-down
        4
        ·
        edit-2
        1 year ago

        🙄 nobody is changing your rates because your home is paid off and your score dropped 1.5%. It doesn’t mean any fucks when it comes to a human looking at it.

    • madcaesar@lemmy.world
      link
      fedilink
      arrow-up
      6
      ·
      1 year ago

      Start with fucking car loans. There is no fucking way people should be getting approved for what they are. It’s the next massive bubble after housing.

  • Taleya@aussie.zone
    link
    fedilink
    arrow-up
    13
    ·
    1 year ago

    The GFC is rather going to end up viewed historically like The Great War. Terrible, but what followed is far worse.