Credit Bureaus Pressured by Government Into Easing Scores

Regulation as political bludgeon

Bullied by President Obama's new consumer watchdog, the Big Three consumer credit bureaus have curved credit scores for deadbeats. The capitulation is a bad omen for the economy.

The credit-scoring system underpins our economy. If lenders and insurers can't rely on it, they can't make sound judgments about the risks involved in millions of transactions each day.

Yet the system is being socialized thanks to a campaign by the administration to falsely smear it as inaccurate and biased against minorities.

The campaign began in 2011 when the Consumer Financial Protection Bureau investigated scoring models used by the consumer credit-reporting agencies. They include the VantageScore owned by the three biggest credit bureaus — Experian, Equifax and TransUnion — which provide scores and reports to underwriters.

Then last summer, the administration fed a front-page story to the Washington Post lamenting how "credit scores of black Americans have been systematically damaged" by subprime foreclosures, "haunting their financial futures." A week later, CFPB announced in Detroit that it would start policing Experian, Equifax and TransUnion.

(H/T Lord Humungus)

Comments

[Sevo]

"credit scores of black Americans have been systematically damaged" by subprime foreclosures, "haunting their financial futures."

Uh, yeah, buying something you can't afford and not making payments on it is *supposed* to affect your financial future.

[Domestic Reagent]

So now the "systematically" racist credit reporting system will put the fix in for black Americans who didn't pay their bills. 'Tis an interesting irony that will be "haunting their financial futures" for years to come.

[Tina3223]

Most all people used to buy everything with credit cards. As for me I used to take out loans. I do this at home with the help of Internet. My friend advised me to contact these guys to apply for a loan. Truth to say, I liked this site. As for credit scores, I prefer mostly to check everything concerned to money. I've read a lot about different lending firms and do not want to be abused.