The REASON for credit scoring

Doc, let me teach you how FICO works and it's net effects. Now then, since your limited education would probably prevent you from truly understanding it if I really got down to the nitty gritty of it all. The really technical side of it, you know. So here is a little story that illustrates the net effect of FICO since you wouldn't understand all of the techie jargon anyway.

An Arab was walking through the Sahara desert, desperate for water,
when he saw something, far off in the distance. Hoping to find water, he
walked towards the image, only to find a little old Jewish man sitting at a
card table with a bunch of neckties laid out on it. The Arab asked,
"Please, I'm dying of thirst, can I have some water?"
The man replied, "I don't have any water, but why don't you buy a
tie?
Here's one that goes nicely with your robes.
"The Arab shouted, "I don't want a tie, you idiot, I need water!"
"OK, don't buy a tie. But to show you what a nice guy I am, I'll
tell you that over that hill there, about 4 miles, is a nice restaurant. Walk
that way, they'll give you all the water you want."
The Arab thanked him and walked away towards the hill and eventually
disappeared. Three hours later the Arab came crawling back to where
the man was sitting behind his card table.

The man said, "I told you, about 4 miles over that hill. Couldn't
you find it?"

The Arab rasped, "I found it all right. Your brother wouldn't let me
in without a tie."

LOL

 

Doc, you need to be more careful with advice like "stomp out FICO." Just try stomping it out and it will probably punch holes in your shoes as well.

 

Well, of course, you know I was just joking.
But you bring up a good point for sure.
The model is terribly flawed and it's still going to take a lot of work to get it right. They have to use millions of sets of statistics over years of time to be able to come up with something that's really accurate and predictive and it just takes time.

How many people died untl Dr. DeBakey (hope I spelled it right) performed the heart replacement surgery and now it happens just about every day and maybe more.

Then it went on to lungs and kidneys and just about every organ in the human body.

All takes time. And some people get killed in the process.

 

You know Doc, I like FICO. Let's face it. Were it not FICO it would be something else and FICO is beginning to be the worse kept secret of all time. FICO can be beaten. It's the devil we know as opposed to the one we don't know.
I think we need to look at like high school teachers. Many are now rated on how many kids pass the high school exit exams. What do they do? They teach to the test. What should we do about credit? Develop the profile FICO wishes to see.

 

Pre 1970 and fico have nothing to do with each other.

Using Fico for price structuring is wrong and unjustified. There is no excuse for allowing such a flawed system to operate .
If they can't do it right don't let them to do it
What's wrong in demanding that they get their act together or get out of the business if they can't or wont??

 

I don't understand the LOGIC of F.I.C.O. scoring either...I have a PERFECT payment history since 1978, but my F.I.C.O. is NOT any where near 850 (685-704)...WHY???

SO WHAT IF I SPEND A LOT OF MONEY ON CREDIT...

I have a 0.00% card, it is at 99.99%...WHO IN THEIR RIGHT MIND WOULDN'T DO THE SAME??? I WILL PAY IN FULL ONE WEEK BEFORE IT EXPIRES!!!

 

In reference to the "OLD" system...I was NEVER denied a "PRE-APPROVED" card (with way less income), UNTIL F.I.C.O. reared it's UGLY HEAD!!!

 

George fico is a shell game.This con game needs to be outlawed.You don't stop a con game operation by rationalizing about it or making excuses for it.
The credit industry makes enough excuses for it on their own.They don't need any help from consumers or posters on this or any other board.

 

BIG chuckle!!

 

George!! You should know better!! Of all people!!

 

George:
Didn't you know we need them so bad that it is Better to let em rip us off however and when ever they want than it would be to close them down till they learned how to fly right?

Using the same logic we should allow quack doctors to keep their license and continue their practice .

I hear ther's a shortage of nurses.Perhaps we should license anybody who walks in off the street and put them to work because we need need nurses so badly.

 

So do I: Of course I like sleeping every nite in a den of rattle snakes to!

 

You're so rite:

-----------And the best way to do it is to outlaw it.

 

The profile F I C O wants to see has all ready been developed.

 

bump

 

why the bump/

 

Hi LB,

Because Greg said to search on "credit scoring disparate impact" and this is the only thread that comes up with lots of applicable information in it, links and thoughtful insight and responses.

From this current thread: http://consumers.creditnet.com/straighttalk/board/showthread.php?s=&pgnum=1&postid=243029#post243029

about Fannie Mae being sued for discrimination for using a racially discriminating scoring model.

Sassy

 

==================
1*Thanks Sassy.

2* This Can't be due to Racial Discrimination for as Dock Says Fico was created to eliminate such discrimination.

 

LBrown,

I've been reading this board long enough to know not to get sucked into this between you and Doc.

I tend to use a lot of words; you tend to use few words.

Sometimes my point is lost in the amount of words; sometimes your point is never made due to a lack of words.

In this case, a lack of words making a statement inaccurate and misleading.

Doc said "Credit scoring was an attempt to remove issues like RACE, GENDER, and SOCIO-ECONOMIC STATUS (a.k.a., income) from an overall assessment of every consumer's credit report."

ATTEMPT is the key word there.

As the discussion progresses he says that current models are flawed and need revising. And that, even the current model flawed and in need of revising, is superior to this country's previous system of making decisions based on nothing but race and gender as well as other personal characteristics.

Earlier today, Greg posted these links on the other thread:

http://www.fdic.gov/regulations/res...de/results.html

http://fic.wharton.upenn.edu/fic/lacourpaper.pdf

http://www.law.emory.edu/ELJ/volume...98/mahoney.html

http://www.ncpa.org/pd/law/lawdefg.html

http://www.phil.frb.org/cca/capubs/cascade39.pdf

and the list goes on.

Greg Fisher

(The links belong over here, I have issues with disjointed threads being separated.)

They substantiate that the elimination of race and gender from the scoring models hasn't eliminated the discrimination; it's just not as overt as it once was.

I've not read Doc discounting the documentation, he only said that credit scoring was an attempt to remove those factors that tend to be discriminating.

Doc speaks eloquently for himself and I hope he chimes in as this is an important issue, still.

I hope the importance isn't lost on my having responded to your baiting because I'd like to read other's thoughts and insights.

Now, would you like to sway and sing kumbaya with marc and I?

Sassy