Obama Adds AA To Credit Scores

Discussion in 'Politics' started by pspr, Mar 14, 2013.

  1. pspr


    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.

    "These companies have never before been subject to any federal supervision program," CFPB chief Richard Cordray said in July. "Now, they will be monitored just as big banks are monitored."

    By that, he meant his diversity cops will subject them, as well, to "disparate impact" investigations. Under that dubious doctrine, policies found to have an adverse impact on minorities are deemed racist, even if they're racially neutral and applied evenly.

    Federal studies show that blacks and Hispanics tend to have the lowest credit scores. So the bureau opened up a complaint line and portal for minorities with damaged credit, followed by on-site examinations at Experian, Equifax and TransUnion. Examiners last fall demanded they turn over data about their methods and practices.

    Then the administration created a crisis in confidence about credit reporting overall, releasing a study claiming less than 80% of credit reports are accurate, which in turn triggered an avalanche of stories by Obama's press stenographers, followed by public outrage. "Can you trust your credit score?" went the typical headline.

    In fact, 98% of reports contain no material errors. Also, a 2007 Fed study found no racial bias in credit scoring in a national sample of more than 300,000 credit bureau records. It found that scores typically underestimate the risk posed by black borrowers, who "show consistently higher incidences of bad (loan) performance than would be predicted" by their scores.

  2. How do the credit reporting cos know race?
  3. Don't credit applications always have a box for "race".. and then say responding to it is "voluntary"?

    There should be not "race" card/qualifications.

    One should "make it on their own"... regardless of whether they are married, single, nig, spic, Jew, raghead, WOP, honky, male, female, fat, queer/fag/lesbo or what? (How's that for being politically incorrect?)
  4. pspr


    Demographics, too. If your neighbor checked black, the odds are that you are black, too.