The Western Governments Interest Rate That Keeps Everyone Pinned Down

[Kathryn]

Dust1n you do know, don't you, that banks are started with capital from owners, partners, and shareholders, right? Banks don't start up by BORROWING money from the federal reserve or any other government agency. A group of investors and shareholders put up the money - after an extremely stringent screening process by state and federal entities.

This is the money that they lend out.

HowStuffWorks "How Banks Work"

 

[dust1n]

Dust1n you do know, don't you, that banks are started with capital from owners, partners, and shareholders, right? Banks don't start up by BORROWING money from the federal reserve or any other government agency. A group of investors and shareholders put up the money - after an extremely stringent screening process by state and federal entities.

This is the money that they lend out.

HowStuffWorks "How Banks Work"

Depends on the bank. For these types of banks, where did the capital originally come from?

 

[Kathryn]

Depends on the bank. For these types of banks, where did the capital originally come from?

All sorts of things. Let me give you an example of how this could come about.

My dad owns a business. He had very low start up costs so he paid cash to start the business. Then he created his product. He did not offer any credit to anyone to buy his product. They bought it anyway, paying cash. He saved a lot of money because his business was successful. Then he paid cash for his house, and in fact does not have a penny of debt and hasn't most of his life.

He has always paid cash for his homes and vehicles and anything else for that matter. How did he start off? My mother inherited about $30k and they bought their first house with that and then just paid cash for every house after that. Where did that inheritance come from? My mother's grandmother, who had saved that money from her own personal income for many years.

This is not as unusual a scenario as you might think, by the way. Working at the bank with lots of small business owners, I saw this sort of thing all the time.

But I digress. My point is that my dad could invest in a bank as a partner or shareholder if he liked. A whole group of guys like him could get together and just start a bank. It happens all the time.

Let me ask you something - these small community banks that you see all over the place. How do you think they got started?

 

[dust1n]

All sorts of things. Let me give you an example of how this could come about.

My dad owns a business. He had very low start up costs so he paid cash to start the business. Then he created his product. He did not offer any credit to anyone to buy his product. They bought it anyway, paying cash. He saved a lot of money because his business was successful. Then he paid cash for his house, and in fact does not have a penny of debt and hasn't most of his life.

He has always paid cash for his homes and vehicles and anything else for that matter. How did he start off? My mother inherited about $30k and they bought their first house with that and then just paid cash for every house after that. Where did that inheritance come from? My mother's grandmother, who had saved that money from her own personal income for many years.

This is not as unusual a scenario as you might think, by the way. Working at the bank with lots of small business owners, I saw this sort of thing all the time.

But I digress. My point is that my dad could invest in a bank as a partner or shareholder if he liked. A whole group of guys like him could get together and just start a bank. It happens all the time.

Let me ask you something - these small community banks that you see all over the place. How do you think they got started?

I know how small community banks and credit unions get started. But if you trace the money back far enough, where did it come from, originally?

 

[Heathen Hammer]

That's funny.

A credit score is based on factors such as past payment history on loans, the borrower's job stability, income, income sufficiency, debt to income ratio, and the impact of the economy.

It's funny because it's an accurate description. The short list you give is nothing like the entirety of how the score is gotten, and as I said, accurately, it is affected negatively by decisions which are actually wise in terms of personal finance: staying out of revolving debt.

So as you see, credit scores are not 'built" on debt or the payment of debts alone.

As for "feeling lesser of a human being, panicking if it's not perfect," - wow, sounds like a personal problem to me. My credit score has had it's ups and downs and it never evoked such feelings in me.

Propaganda.

It's possible you never got this kind of feeling because, as a financial industry drone you felt a false sense of security, Surely the industry you worked in could never harm you. Certainly because you maintain a good credit score, there couldn't possibly be anything actually wrong with the system! As long as it doesn't happen to you, it cannot possibly happen!

By the way, I worked in the financial industry for years, and literally NEVER saw a "perfect" credit score (850). In 2010, the average score in the US was 723 - a score which will certainly allow a person to take advantage of good, low interest rates.

I never stated one has to obtain a perfect score; as you admit, it's not possible.
However a very real pressure is placed to have that score. A high score, a socially acceptable score. There's an entire cottage industry just to be able to check it at any time. To deny it is dishonest.

I'm not clairvoyant. How would I know why your score is "garbage?"

And by the way, if indeed your score is "garbage," I doubt very seriously that it's simply because you don't have any credit.

Of course you would; you need to cast a negative light on me, as Im trashing the industry you worked in.

I specified directly how my score is garbage:

I have not applied for credit in many years, have not taken out credit for a number of years, and have not paid back any credit in a number of years. I've mishandled debt by not having any and bucking the system in its face.

A credit score is not based on that alone, as I pointed out above. As a loan officer, I often had customers in the same scenario. A very young person - with no job history AND no credit history - would probably have a hard time getting a large loan. But an adult with several years of good job history, who hasn't applied for any credit for years, with a good credit score (yes, you can definitely have a decent credit score with no debt, because the scores depend on other factors as well), can usually "get credit" easily.

You have other options too. For instance, my father hasn't had any debt in years and his credit score is over 800. How does he do it? He has ONE credit card and he uses it a couple of times a year and then turns around and pays it off immediately, so he never pays any interest. Lots of people do this to maintain an excellent credit score while staying completely out of debt.

I don't choose to do that: I choose to remain out of debt, which is the smartest course of action. Even your own father is a slave to the system exactly as I described: what purpose does his making arbitrary purchases on a credit card he doesn't actually want, serve him? Oh wait, that's right, it's just like I said: he feels the pressure upon him to maintain a digital score which serves him no good purpose, because people just like you, pitch it to him and everyone else that having a good credit score is something you NEED.

Essentially your family anecdote proves my point. He has no real reason to have and use that credit card - except to keep his imaginary score good for when bankers look at it.
Besides, interest compounds daily. Although it is possible that his card offers zero interest if ... they likely have service charges or are otherwise milking him for a few pennies or dollars here and there; that's how they work.

Wow, you are so emotionally involved in this. Paying debts back in a responsible manner DOES indicate that one can and will do so. In other words, the best predictor of future behavior is past behavior. Don't take objective reality so personally.

Don't take my trashing of the corrupt credit system so personally.
lol, 'objective reality'. Artificial numbers representing your behavior is not 'objective' in any sense of the word.

As for companies being able to access your "frozen credit reports," no, they can't do so if you've formally "locked" them. Don't be so paranoid.

Maybe; probably not so, though. Given the lack of privacy we have in the US, I would not be so iron-clad on that idea.

Actually I did address it. But the fact that you didn't realize it thru your paranoid ranting doesn't surprise me.

In the same way that God doesn't kill people; nature and circumstance and other people do!

"The credit industry" doesn't destroy people's family - let alone their credit - life and the actions of individuals destroy people's credit - and their families.

Sometimes life holds terrible tragedies for people. That's just an unfortunate reality. "The bank" doesn't cause you to lose your job, or not save enough money to live on thru an emergency, or plan poorly, or become disabled, whatever.

The bank does take your house away though and keep all the money you ever paid into it.

Nice way to avoid personal responsibility for your own financial decisions and planning.

Nice way to shill and dissemble for your banker masters

 

[lunakilo]

Dust1n you do know, don't you, that banks are started with capital from owners, partners, and shareholders, right? Banks don't start up by BORROWING money from the federal reserve or any other government agency. A group of investors and shareholders put up the money - after an extremely stringent screening process by state and federal entities.

This is the money that they lend out.

HowStuffWorks "How Banks Work"

But where did the owners, partners, and shareholders get their money from?
If you trace all the money back to its origin you will find that it doesn't really exist.
At some point it came into existence because someone said they had it and people in general agreed that that is so.

 

[Heathen Hammer]

Ahh, they definitely did it right in the 1700s. Money you could hold in your hand, bag up and smack people with, or bury on a deserted island for a rainy day. You knew where your money came from back then.

 

[lunakilo]

But that's the problem. Not only has growth been enough to allow all people to pay of all loans and interest rates, but infinite growth is not a possibility anyways because we live in a finite world. The fact that interest rates exist does not to exacerbate this problem.

Bankers do create money out of thin air, but they can't do so and then spend it as it never happened. That was the problem with your example. Banks are subject to the same interest rate problem and that is just continued and made worse by the time home loans are made.

EDIT: Another problem with the metaphor is that it makes no sense why a banker would go through all that effort to pay $12 bucks per wheat, when he could have done so for $10 from farmer A in the first place.

Well if you notice my example did not require infinite growth, just growth.
In fact on this little island all debts ended up being repayed even though they were repayed with interests.

And the example was silly, but that is what I was able to come up with at such short notice
It is difficult to make simple examples that make sense.

imagine using grain as currency instead of money.
Imagine an island with two farmers.
Farmer 1 has no grain, and farmer 2 has grain to spare, so he lends his extra grain to farmer 1 on the condition that farmer 1 gives him back twice that amount after harvest.
Farmer 1 grows grain and produce five times the original amount of grain. Come harvest he is able to give farmer 2 the amount of grain he promised, and still keep some for himself.

Farmer one payed back his loan with interests. There is no problem because the total value of stuff (the amount of grain) on the island has grown.
But it does not need to grow infinitly.

In the real world things are not so simple, and people are not so sensible.
We may be heading directly towards the edge of the cliff but it seems to mee that it is not charging interests which is in it self the problem, but more the fact that the amount of money which is conjured into existence has no counterpart in the real world.
Which basically leads to the problem of near infinite growth that will wreck the planet.

 

[Panda]

But where did the owners, partners, and shareholders get their money from?
If you trace all the money back to its origin you will find that it doesn't really exist.
At some point it came into existence because someone said they had it and people in general agreed that that is so.

Originally it was gold reserves. Gold was a valuable commodity we used as a trade item and as an intermediate so you were not directly bartering with others, instead it was indirect via some form of currency.

 

[Kathryn]

I know how small community banks and credit unions get started. But if you trace the money back far enough, where did it come from, originally?

Adam and Eve?

Money doesn't start with loans, Dust1n. It starts with, "I have this. You have that. I will give you this for that."

 

[Kathryn]

But where did the owners, partners, and shareholders get their money from?
If you trace all the money back to its origin you will find that it doesn't really exist.
At some point it came into existence because someone said they had it and people in general agreed that that is so.

Now that we're printing money without actually having the gold to back it, this is more true - but just for the record, that's not the banks' fault. Banks don't print money. The government prints money.

Prior to this fairly recent development however, paper money was representative of gold. In other words, it was like a check that guaranteed that the gold was there to back it, just like when you write a check from your checking account you're guaranteeing that the money is there to back it.

 

[Kathryn]

Originally it was gold reserves. Gold was a valuable commodity we used as a trade item and as an intermediate so you were not directly bartering with others, instead it was indirect via some form of currency.

Honestly, do people not KNOW this?

Scary.

 

[Kathryn]

This whole post is so ridiculous, I almost didn't even bother answering it.

It's funny because it's an accurate description. The short list you give is nothing like the entirety of how the score is gotten, and as I said, accurately, it is affected negatively by decisions which are actually wise in terms of personal finance: staying out of revolving debt.

You're the one who gave a short list. You said that credit is built on debt, period. I gave a much wider description of ALL the elements involved in building a credit score.

I made it clear that a person can have a good credit score WITHOUT carrying debt - without a SPECK of debt in fact - but I notice you didn't address that portion of my post.

I'm not at all surprised.

Propaganda.

It's possible you never got this kind of feeling because, as a financial industry drone you felt a false sense of security, Surely the industry you worked in could never harm you. Certainly because you maintain a good credit score, there couldn't possibly be anything actually wrong with the system!

It's possible - but this is not the case. First of all, as a person who worked in the financial industry for about eight years, I have knowledge about banks and credit, and insight into the industry that you, very obviously, do not have.

There's plenty wrong with the system - you're just picking the wrong things to harp about - and using a lot of misinformation to do so.

As long as it doesn't happen to you, it cannot possibly happen!

This is one of the more ridiculous statements you made.

You know what - working in a bank gave me a lot of insight into a very wide array of personal situations - from personal triumphs to tragedies. Of course any number of terrible things could happen to me. That's why I plan as best I can and try to make the best decisions I can financially. That's why my husband and I have put aside enough money to live on for at LEAST a year, probably more, if NEITHER of us could work at all.

However a very real pressure is placed to have that score. A high score, a socially acceptable score. There's an entire cottage industry just to be able to check it at any time. To deny it is dishonest.

That's why I didn't deny it. Hell, we didn't even talk about that aspect of the scenario.

I don't know what this "socially acceptable" thing is you're talking about though, and all this "pressure" you're describing. Weeks at a time go by without me even thinking once about my credit score. I would hardly call that "pressure."

Of course you would; you need to cast a negative light on me, as Im trashing the industry you worked in.

No, this is YOUR tactic, not mine. You're the one who is throwing personal insults around, not me.

I don't particularly love the banking industry - it's got it's flaws, just like any other industry I worked in. And I don't even WORK in banking anymore. I have no need to sugarcoat the industry - and I certainly don't have some sort of idealistic view of it. I understand how it works - and you obviously do not.

I specified directly how my score is garbage:

Nope. All you said is that you don't have any revolving credit. That alone will not create a "garbage" score. I clearly explained that this is only one of MANY factors, and that even a person with zero credit who has otherwise good credit factors, such as no negative loans or debts, no lay pays, solid work history, etc. should still have a good credit score and be able to obtain a loan with a good interest rate.

If your score is indeed "garbage" as you state it is - it's not simply because you have no revolving credit. I don't believe that for an instant. If your score is garbage, it reflects other negative factors in your life/work history/prior debts or loans or bills/etc.

I don't choose to do that: I choose to remain out of debt, which is the smartest course of action. Even your own father is a slave to the system exactly as I described: what purpose does his making arbitrary purchases on a credit card he doesn't actually want, serve him? Oh wait, that's right, it's just like I said: he feels the pressure upon him to maintain a digital score which serves him no good purpose, because people just like you, pitch it to him and everyone else that having a good credit score is something you NEED.

Nope. MY dad uses a particular credit card because he earns lots of points at a certain sporting goods store. Like I clearly pointed out, he turns right around and pays the balance immediately, so he's not "in debt." Meanwhile, he's earned the points and gets all sorts of cool tools and toys from this place. It's like Christmas every month for him!

I do the same thing with my Discover card and large purchases. It's so cool that they send me gift cards just for using that card!

Even if my father didn't use that card, (and remember, I said that he has no debt, and hasn't had any sort of debt for at least 20 years), his credit score would be around 800. He just likes the free stuff he gets from using that card.

Essentially your family anecdote proves my point. He has no real reason to have and use that credit card - except to keep his imaginary score good for when bankers look at it.

He has no need for bankers to look at his score - he has no debt and will not need to have any debt most likely for the rest of his life.

Like I said, he gets free stuff for using the card.

By the way - an aside note. My father had never even been LATE on ANY sort of payment in his entire LIFE till about a year ago, when he forgot to mail a payment in on some little bill he had. He was TICKED at himself!

He's a trip.

Besides, interest compounds daily. Although it is possible that his card offers zero interest if ... they likely have service charges or are otherwise milking him for a few pennies or dollars here and there; that's how they work.

My dad has never paid a penny of interest, or any sort of service charge on this card. Hey, guess what - if you have made good financial decisions for a lifetime, you can qualify for all sorts of great deals.

By the way, I have a very similar deal on my Discover card. If I pay the balance in full each month, I pay zero interest. There are no service charges. And I get points when I use the card, that I can redeem with Discover for cold, hard cash.

Don't take my trashing of the corrupt credit system so personally.

Oh, I'm not. I'm just amazed at how ridiculous your arguments are.

lol, 'objective reality'. Artificial numbers representing your behavior is not 'objective' in any sense of the word.

The numbers represent risk factors. That's all. If your score is garbage, it represents that you are a higher risk for a lender. And apparently you are - based on what I see in your attitude, you'd have no qualms whatsoever about walking on a loan, because you see lenders as "the bad guy" and yourself as a perpetual victim.

The bank does take your house away though and keep all the money you ever paid into it.

Actually, as I explained to you already, this isn't even true.

If you have equity in the house, and the bank sells your house, if there is money left over after the sale, you will receive that money.

In other words, say I've got $50,000 in equity and owe the bank $100,000. Say my house is worth $150,000 and the bank forecloses on it and sells it for $150,000. The bank gets their $100,000 and I get my $50,000.

This is a simplistic picture, and the reality is that very few homes with any significant equity are actually foreclosed on, for a number of reasons, including the fact that if a person actually has equity in a home, they have more of a reason to actually try to avoid foreclosure.

Most homes that are foreclosed on are "owned" by people who have little, to ZERO equity - which is yet another reason why it's not a good idea for people to buy a home with no down payment. They actually have no ownership in a home. If you have no equity in a house you're living in, you own nothing. And when you foreclose on it, you've lost nothing. All you've done is pay rent to live somewhere.

 

[Aquitaine]

Now that we're printing money without actually having the gold to back it, this is more true - but just for the record, that's not the banks' fault. Banks don't print money. The government prints money.

If I am not mistaken, although the Government "mint" prints new physical FRNs, the vast majority of "money" (in the form of digital Credit, with interest and ergo debt attached) is created by the Banks whenever they establish a Loan.

 

[Kathryn]

If I am not mistaken, although the Government "mint" prints new physical FRNs, the vast majority of "money" (in the form of digital Credit, with interest and ergo debt attached) is created by the Banks whenever they establish a Loan.

A loan on paper is an asset to the lender, just as rent being paid to a landlord is an asset to the landlord. (Income is considered an asset and both rent and loans bring in income.)

By the way, a salary paid in arrears is a loan. You work first, and trust your employer, who owes you money, to pay you back. But you consider this salary to be an asset.

If someone comes to your house and does some plumbing work, you have just "taken out a loan" and you owe them, even if you turn around and pay them in silver, or with a goat, an hour later.

At least, that's one way of looking at it. Using that rather tortured approach, one could say that we're all walking around as both debtor and lender most of our lives.

 

[Aquitaine]

A loan on paper is an asset to the lender, just as rent being paid to a landlord is an asset to the landlord. (Income is considered an asset and both rent and loans bring in income.)

By the way, a salary paid in arrears is a loan. You work first, and trust your employer, who owes you money, to pay you back. But you consider this salary to be an asset.

If someone comes to your house and does some plumbing work, you have just "taken out a loan" and you owe them, even if you turn around and pay them in silver, or with a goat, an hour later.

At least, that's one way of looking at it. Using that rather tortured approach, one could say that we're all walking around as both debtor and lender most of our lives.

I think perhaps that's a rather broad classification of the term "loan". In the context which I am using the term "loan", I'm talking about loans established between a Bank (or other private lending institution) and a borrower. Depending on the Fractional Reserve Ratio set by the Government/Central Bank, a Commercial bank my create 10, 20, 30 or even unlimited amounts of "Dollars" per every Dollar deposited into said bank by a Customer. This practice thus effectively "prints" digital Dollars into circulation, ergo the main Commercial bank end up "printing" more money than the Government Mint.

 

[Revoltingest]

I think perhaps that's a rather broad classification of the term "loan". In the context which I am using the term "loan", I'm talking about loans established between a Bank (or other private lending institution) and a borrower. Depending on the Fractional Reserve Ratio set by the Government/Central Bank, a Commercial bank my create 10, 20, 30 or even unlimited amounts of "Dollars" per every Dollar deposited into said bank by a Customer. This practice thus effectively "prints" digital Dollars into circulation, ergo the main Commercial bank end up "printing" more money than the Government Mint.

It seems that there are many conflicting opinions on this subject.
I go with this explanation.....
Free Banking » The Problem is Central Banking not Fractional Reserve Banking

If we imagine a simple non-electronic system, then unless banks operate printing presses, they cannot create money. As I understand it,
what some would call money "creation", is really a daisy chain of obligations which exceed the deposits if summed up. But this sum is
not the same as actual currency in circulation. Actual money creation is done by the gov't via their central banking system.

 

[dust1n]

Adam and Eve?

Money doesn't start with loans, Dust1n. It starts with, "I have this. You have that. I will give you this for that."

That's a barter, not money. The government prints money and loans out at interest, am I misunderstanding this?

 

[Heathen Hammer]

You're the one who gave a short list. You said that credit is built on debt, period.

I certainly did not.

I gave a much wider description of ALL the elements involved in building a credit score.

You left out the negative and dishonest elements which I noted.

I made it clear that a person can have a good credit score WITHOUT carrying debt - without a SPECK of debt in fact - but I notice you didn't address that portion of my post.

I did; I disagreed with the idea. The system is not designed to reward people who for example live as I do. I know this for a fact. In addition your idea of 'no debt' is actually having debt and then payuing it off before interest and fees acrue [the example of your dad]- which is another way of saying 'actually having debt'. Actually incurring zero debt, as I do, is NOT how to get a good score.

It's possible - but this is not the case. First of all, as a person who worked in the financial industry for about eight years, I have knowledge about banks and credit, and insight into the industry that you, very obviously, do not have. There's plenty wrong with the system - you're just picking the wrong things to harp about - and using a lot of misinformation to do so.

As an agent of the system, you are programmed to support it. Your words are suspect. Case in point: you left out all the negative/dishonest methods. Every now and again however, agreeing that they were there.. then denying them soon after.

This is one of the more ridiculous statements you made.

But it's an accurate assessment.

You know what - working in a bank gave me a lot of insight into a very wide array of personal situations - from personal triumphs to tragedies. Of course any number of terrible things could happen to me. That's why I plan as best I can and try to make the best decisions I can financially. That's why my husband and I have put aside enough money to live on for at LEAST a year, probably more, if NEITHER of us could work at all.

Another confirmation: you admit that the banking industry leaves people open to tragedy, but a few lines back deny that's the case at all. I understand that your insider info allows you to avoid most of the pitfalls - but to deny that such pitfalls exist and are cultivated - because it makes banks tons of money when people slip on those pitfalls- is simply dishonest.

That's why I didn't deny it. Hell, we didn't even talk about that aspect of the scenario.

I don't know what this "socially acceptable" thing is you're talking about though, and all this "pressure" you're describing.

Then you must be blind to the ads, and to the actual effects, and to the websites offering the ability to check, and...

No, this is YOUR tactic, not mine. You're the one who is throwing personal insults around, not me.

You are too. Don't pretend. You have on several occasions lashed out at me directly, accusing me of being a bad defaulter. Simply to have some insult to say.

I don't particularly love the banking industry - it's got it's flaws, just like any other industry I worked in. And I don't even WORK in banking anymore. I have no need to sugarcoat the industry - and I certainly don't have some sort of idealistic view of it. I understand how it works - and you obviously do not.

As I said, you are still associated with it and cannot handle the guilt by association; it's textbook psychology

Nope. All you said is that you don't have any revolving credit. That alone will not create a "garbage" score. I clearly explained that this is only one of MANY factors, and that even a person with zero credit who has otherwise good credit factors, such as no negative loans or debts, no lay pays, solid work history, etc. should still have a good credit score and be able to obtain a loan with a good interest rate.

I said more than that.

If your score is indeed "garbage" as you state it is - it's not simply because you have no revolving credit. I don't believe that for an instant.

I don't believe you for an instant, either, so we're even

Nope. MY dad uses a particular credit card because he earns lots of points at a certain sporting goods store. Like I clearly pointed out, he turns right around and pays the balance immediately, so he's not "in debt." Meanwhile, he's earned the points and gets all sorts of cool tools and toys from this place. It's like Christmas every month for him! I do the same thing with my Discover card and large purchases. It's so cool that they send me gift cards just for using that card! Even if my father didn't use that card, (and remember, I said that he has no debt, and hasn't had any sort of debt for at least 20 years), his credit score would be around 800. He just likes the free stuff he gets from using that card.

These draws are still lures to get you to use something you have no real use for, and which is dangerous to you to have. [or him]. The companies are making profit on you, so those free perks are being paid for by you; you are not ahead of the game. Nothing is free, especially in the banking world. If not him, then someone else is being squeezed for the money to cover what he's greedily gobbling up - he sees the word 'free' and doesn't realize no bank gives anything away. Somehow a profit is being made, and the dupe does not necessarily care, as long as it's not his pocket. Again - that fatal assumption that as long as nothing bad happens to YOU, there can't be anything wrong with the system, and that is definitely wrong.

He has no need for bankers to look at his score - he has no debt and will not need to have any debt most likely for the rest of his life.

Then he has no need to do what he does with a credit card he doesn't need.

Like I said, he gets free stuff for using the card.

By the way - an aside note. My father had never even been LATE on ANY sort of payment in his entire LIFE till about a year ago, when he forgot to mail a payment in on some little bill he had. He was TICKED at himself!

IM sorry to hear. He should be ticked, as it cost him money that he needn't have spent

 

[Heathen Hammer]

My dad has never paid a penny of interest, or any sort of service charge on this card. Hey, guess what - if you have made good financial decisions for a lifetime, you can qualify for all sorts of great deals.

As I said: they aren't really free. I do not believe you on the idea he's never paid anything. Sorry.

By the way, I have a very similar deal on my Discover card. If I pay the balance in full each month, I pay zero interest. There are no service charges. And I get points when I use the card, that I can redeem with Discover for cold, hard cash.

Discover Card, hah! Possibly the worst offender, though I have never gotten within 10 feet of American Express, who are rumored to be little better than animals.

I had my ID stolen by Verizon kiosk clerk, who tried passing nearly $10k through my account via another Discover customer. A few months later he attempted to buy a car with it. Over several months, it took them more than 3 to even verify anything untoward was going on and admit it was not me [even though the idiot had a dupe card sent to another address, thus easily identifiable]. The other customer and myself did all our own investigative work. Discover Card did not want any of the info we'd found, did not investigate, did not prosecute. They said to go to the cops; local cops said DC should have handled it. The perp went scot free. Undoubtedly still committing similar crimes.

The numbers represent risk factors. That's all. If your score is garbage, it represents that you are a higher risk for a lender. And apparently you are - based on what I see in your attitude, you'd have no qualms whatsoever about walking on a loan, because you see lenders as "the bad guy" and yourself as a perpetual victim.

they are the Bad Guy, and we are all victims. Your assessment is garbage too, as you're just one of their stooges. And you are part of the problem, admitting in previous posts that you approved loans to people you KNEW were borrowing too much;
in that case the right business action, IF the banks were not raking it on over such, would have been simply to refuse the loan to the people you knew were overextending. That is part and parcel of the business practices I've been railing against: you did it anyway. Case closed!

Actually, as I explained to you already, this isn't even true.

If you have equity in the house, and the bank sells your house, if there is money left over after the sale, you will receive that money.

In other words, say I've got $50,000 in equity and owe the bank $100,000. Say my house is worth $150,000 and the bank forecloses on it and sells it for $150,000. The bank gets their $100,000 and I get my $50,000.

Yes, I read that, and it's essentially a lie. There is no equity left in such homes these days. Your numbers are WAY overinflated [more sugarcoating], totally unrealistic. It is almost always a case of the opposite. In fact your next post admits it, shown in red:

This is a simplistic picture, and the reality is that very few homes with any significant equity are actually foreclosed on, for a number of reasons, including the fact that if a person actually has equity in a home, they have more of a reason to actually try to avoid foreclosure.
Most homes that are foreclosed on are "owned" by people who have little, to ZERO equity - which is yet another reason why it's not a good idea for people to buy a home with no down payment. They actually have no ownership in a home. If you have no equity in a house you're living in, you own nothing. And when you foreclose on it, you've lost nothing. All you've done is pay rent to live somewhere.

that rent was not paid out as rent, it was presumed equity: savings.. And you've lost all of it, and your future in the home you dreamed of and paid through the nose to get. You obviously have zero idea what a person foreclose don goes through, talking as if it's just another sunny day. It's actually suddenly being working class homeless.

I know people who've been through it, and I know people who've been through the almost obscene banking scam today, which is the 'new', post-bailout dynamic of home loans processing; delay after delay, fake losing of paperwork, bs 'purge of information' at the end of a year so that all paperwork has to be submitted again, oddball requests of info. All a scam to delay or frustrate the application on the applicant's side.

It's literally a huge conspiracy, with a few randomly-placed drones to tell all of us to go back to sleep, the banks are your friends, nothing to worry about.

New Twist: Your Credit Score is a ‘Ranking,’ Not a ‘Rating’ | Zillow Blog
Credit vs. Debt: The Lie Behind Your Credit Score