Credit Criticism Why Credit Checks Might Cause Financial Problems

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Credit Criticism Why Credit Checks Might Cause
Financial Problems
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• With credit a hot topic in today's society,
  social media is more than sceptical when it comes
  to the FICO credit score and what financial
  problems a bad credit score can potentially
  cause.
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• Although a person's credit score can provide a
  lot of insight into possible risk due to poor
  money management, debt load, or existing
  financial problems, it can also cause financial
  problems that didn't exist before hand due to
  poor risk management, employment decisions, or
  impacted living.

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Risk Management

• Great credit scores don't mean great customers,
  and the when lazy lenders look at the number
  instead of the whole inquiry, they put their
  clients at risk. 
• For example, an elderly woman with a credit score
  of 680 might qualify for a great rate, but she
  wants to borrow money to take care of funeral
  costs for her husband. She has a small pension,
  several credit cards and with her husbands
  passing, has lost a second income. 
• Realistically, extending this woman more credit
  could actually put her at risk for future
  financial problems, primarily because a number
  can't assess her situation on a personal level.

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Employment Decisions

• Top of his class, graduate with honours, four
  years of experience, and he aced the interview!
  The young man in question is a prime employment
  candidate - that is, until his boss runs an
  inquiry. 
• Although Experian, Equifax, and TransUnion have
  stated on record that they do not provide
  employers with a score, they do provide them with
  a record that can reveal previous jobs, past
  addresses, aliases, and financial information
  such as recent inquiries, debts and legal
  actions.  
• When an inquiry reveals an applicant has some
  serious financial problems, he or she may be
  denied a position based on information that is
  not representative of their workplace abilities.

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Quality of Life

• Every citizen has a right to a safe place to
  sleep, and by law are required to carry insurance
  when driving. Using credit to determine if an
  individual qualifies for a roof over their head
  or denying them the ability to abide by the law
  due to financial problems isnt just immoral,
  its unlawful, and concerns over increased use of
  FICO scores to ostracize individuals with
  financial problems may soon force government
  bodies to step in and say enough is enough when
  it comes to inquiry. 
• Until then, individuals can only try a clean
  record by making timely payments, avoiding
  collections, and removing unwanted inquiries with
  the help of Inquiry Busters to ensure they arent
  denied important opportunities.

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