WorthKnowing.com - Upon furthe

Discussion in 'Credit Talk' started by Steven Z, Sep 15, 2000.

  1. Steven Z

    Steven Z Guest

    Ok, after some calm reflection I have taken another look at WorthKnowing.com.

    I came to WorthKnowing.com upon the premise that I would be obtaining a "free" credit report and most importantly my credit score, with the promise of no 'hard inquiry' on my TU credit report. Since no transaction is truly free, I was aware that I would be exchanging some personal information which, regardless of what they claimed, would be subsquently sold or find its way to various data marketing firms. But I was cool with that.

    Upon completing my application I was given a credit score in the "very good" range.

    One clarification for Michael, WorthKnowing states that they will match you to an issuer based on your "credit score" NOT your "credit report", even though its true the credit score is compiled based on information in the credit report but as far as the creditors are concerned they will not see this unless you give them the authorization by making an application with them, whereupon they will proceed to examine your credit report which will result in a hard inquiry.

    Credit Scoring

    As I've stated previously I do not see them as being benefical to consumers and believe that all financial factors should be taken into consideration. Others look upon it differently and see it as a boon, including most of the financial industry. In fact they deem it the "most important factor". A passage from WorthKnowing.com's site puts in succintly.

    "A credit score is the primary element lenders utilize when evaluating a credit application. Virtually all credit decisions (i.e., bankcards, home mortages, car loans) are granted or denied based on a consumer's credit score. Credit scores are used to determine APR's, Credit Line, and annual fee. A high credit score indicates a low risk of delinquincy and commands better products. A low score indicates a higher risk of default."


    "A consumer who consistently receives offers of 9.9% APR or less, or gold or platinum cards with significant reward programs, can be confident that their score is average or above average (considering their sample profile is 44 and is considered good I would surmise that this is the average). Consumers who rarely receive pre-approved offers, or who receive offers with less favorable terms such as 24.9% APR or secured cards, may have a lower credit rating."

    Putting teething pains and bugs aside, if the credit scores are deemed legitimate than based on this and SOLEY this score an individual would be granted (or not) credit and terms. According to the dogma of "credit scoring" this is done regardless of race, creed, age, sex, residence or other factors which could conceivably cause bias.

    So, under this premise of credit scoring those applicants with high scores would be receiving the best offers while those with poor scores the worst. Moreover, all those with similar scores would be offered similar products and options. No ifs, ands or buts. So goes the theory.

    Premise 1

    Credit Scoring

    If I were to use myself as an example, my TU credit score would, according to WorthKnowing's charts and graphs, entitle me to qualify for cards in the very good range.

    Thus, I should expect to see "pre-approved" offers of two sorts:

    Solid: such as the Capital One Platinum, 9.9% APR, no annual fee, credit limit upwards of $10,000

    Risk or Tier based by such companies as Providian who will highlight their high-end platinum one's with the best terms but cover their asses by guaranteeing nothing but a secured card, although NextCard is offering an innovative upgrade package(s)

    Naturally, I should receive identical "pre-approved" offers as those whose scores match mine and similar one's to those in my range, of course I would be eligible for all lower offers.

    That is if this premise holds true. If it turns out that those with identical or similar scores are being treated differently then we can throw premise 1 out the window and consider what other factors OTHER than the credit score are making up the creditors decision.

    Premise 2

    Other Sources

    If the creditors in actual fact, use credit scores soley as a means of rejection rather than acceptance, they will be using other means of information to grant credit or even for "pre-approved" offers even to individuals with identical scores

    Credit Header information: The most common choice which provides such things as name, telephone number, employer, SSN and the all-important DOB and address. Based on these the creditor can use market segmentation techniques or hire the services of such companies as Micro Vision at http://www.natdecsys.com/mv.html to do it for them. And while my own segement is alright woe be it to them that live in the "wrong areas" or are the "wrong age" or have the "wrong mix", if anybody gave any credence to the malarky being pushed as to how credit scores were to bring 'equality' this is a cold slap of reality in your face for bias and racism has not only NOT gone away but has gone high tech!

    *For those not aware as of November 12, 2000 the CRA's will not be able to sell or otherwise provide credit header information without a permissible purpose as defined by the FCRA. So unless the CRA's are able to overturn this or at least get some sort of temporary injuction their time is running out on this extremely lucrative business and risk losing it to database marketing firms. It has been speculated that the CRA's are looking at selling credit risk scores to make up for this loss. Which is where a firm such as WorthKnowing.com comes in.

    Also, who is to say somewhere buried in the terms and conditions of WorthKnowing.com there 'may' be a clause which gives the authorization for all creditors, partners, affliates and even interested parties to purchase the credit header from TU (who for all we know may control WorthKnowing lock, stock and barrel and be using it as a front) from those who register on the site and in so doing circumvent the aforementioned laws. And since its not a 'hard inquiry' they'll find few who are willing to complain. I imagine with the right amount of advertising few surfers would be adverse to the opportunity to not only a receive free credit report but a most desirable free credit score, many of whom will probably think its their FICO score.

    The Credit Report itself: In this respect those with higher scores will have their TU report filled with promotional inquiries from prime and premium banks while those with low scores will garner the attention of the sub-prime institutions.

    The CRA's own marketing arms. A creditor such as Capital One may have an agreement with Equifax that as soon as an consumer has a charge-off or collection on his report than this information is provided to them. Thus the individual in question may find an unsolicted offer for a sub-prime or secured card well before he is even aware of the bad mark! Or Chase may have an agreement with Experian that they will be notified as soon as a competitor's premium card is reported on a consumer's report thus resulting in an "invitation to apply" for their own premium card. Obviously this will not be a "pre-approved" offer as they have no idea whats on the individual's report, thus you can rest assured that a promotional inquiry will be forthcoming in the very near future.

    The Credit Report itself: In this respect those with higher scores will have their TU report filled with promotional inquiries from prime and premium banks while those with those with low scores will garner the attention of the sub-prime institutions.

    In my own case these inquiries will result in "pre-approvals" only from companies who provide both prime and sub-prime cards such as Capital One, Providian and NextCard and be totally ignored by the rest.

    Various other databases and blacklists: With both the former and the latter their is a question as to just how accurate the information is. And while in theory the latter must follow FCRA regulations, in practice this is rarely the case (with the noted exception of ChexSystems and it took a HUGE public backlash to accomplish that). There are really no safeguards other than moral or ethical duty and the 'word' of those who are running these lists to see if the information is correct and time-relevant (I have heard cases of those who broke a lease over 20 years ago still being kept on these lists and being refused apartments over this).

    Based on these circumstances my credit score would be irrelevant and what offers I did receive would be based on information received from these other sources. Meaning a person could literally have a '100' credit score and still be rejected 'out of hand' because of what some blacklist "claims". Invariably, the applicant will receive a rejection letter with made up adverse reason codes and if he further questioned a CSR would receive "it was something in your credit report" lie.

    I feel the next three months should prove the validity and direction of the above in much clearer form.
  2. rickyg

    rickyg Guest

    RE: WorthKnowing.com - Upon fu


    Drugs are bad, um k?
  3. BarryN - C

    BarryN - C Guest

    RE: WorthKnowing.com - Upon fu

    Interesting backhanded comment from an IP address owned by CompuCredit Inc. (compucredit.com)

    They are our friends that give us Aspire Visa Cards.

    Perhaps they own a stake in worthknowing.com.

    Good Luck,

  4. Saar

    Saar Banned

    RE: WorthKnowing.com - Upon fu


    I always enjoy reading your posts. You should know, however, common courtesy dictates that any post exceeding 5,000 words should be followed by an executive summary :)

  5. Lopez

    Lopez Guest

    RE: WorthKnowing.com - Upon fu

    atually i rather enjoy them
  6. Steven Z

    Steven Z Guest

    RE: WorthKnowing.com - Upon fu

    Perhaps 'your' friends as they did go 'out of their way' to call you last month and offer you their "glorious" Aspire Diamond Visa at a paltry 35% APR :)

    Myself, based on Doris K's recommendation and an article last year (then reposited this year) from Bankrate.com I applied and got the 'thin envelope'. They did an inquiry with TU, which I thought strange since their located practically on the doorstep of Equifax.

    In retrospect, I am quite happy about this as it not only was determined that they do not report to the CRA's but the have most usurous APR's in the industry.
  7. Steven Z

    Steven Z Guest

    RE: WorthKnowing.com - Upon fu

    Perhaps I should get cool tagline like CreditWorks has :)

    Until then perhaps this summary will have to do:

    Based on a 'very good' score from WorthKnowing/TU

    Will this bring forth "pre-approved" offers from creditors, and if so what type?

    Will this bring about more promotional inquiries from creditors?

    Will creditors just ignore the score and use other means and sources as a basis for offers?
  8. dogman

    dogman Well-Known Member

    Barry : )

    Barry, don't you love DSL? Doris uses it too I know and so do a few folks around here.

    Most people haven't even considered IPs!
  9. dogman

    dogman Well-Known Member

    Executive Summary

    Actually, the Executive Summary should be on the cover page;
    specifically one precise paragraph - bulleting important points.
  10. RichGuy

    RichGuy Guest

    Beautiful Analysis

    Thanks for the beautiful analysis. Please give us more when you get a chance.
  11. BarryN - C

    BarryN - C Guest

    RE: Executive Summary

    At the very least if ought to be a powerpoint file with embedded multimedia.

    Show me the money!


  12. Steve Ande

    Steve Ande Guest

    Whoa! Blacklist??? Tell me m

    Has anyone ever seen one of these blacklists? Where can I get access to one? Steven Z...is it true that creditors match my application not only against my credit report, but a "blacklist" as well? So, my student loans listed as 120+ days past due with a zero balance and "paid in full" description may very well be a factor for automatic rejection from one of these lists, huh?

    Do you know how prevalent the use of such lists is?
  13. CardReport

    CardReport Guest

    RE: Whoa! Blacklist??? Tell

    My understanding is that the most common use of "bad customer" blacklists is for things like unpaid utility bills and misbehavior with sub-prime financing like "rent-to-own" deals. In the case of utilities, the lists would probably *not* be covered by the FCRA, since each company would maintain their own list, with info on just their own experiences, and would have a reciprocal deal to swap with other companies. This seems likely to become more popular with the opening of some areas for utility competition, since that creates more opportunities for customers to evade a bill with one provider, and then switch to another.

    CardReport.Com - Credit Tools, News, And Reference


    Everything You Need To Know About Credit And Debt
  14. Steven Z

    Steven Z Guest

    RE: Whoa! Blacklist??? Tell

    There are many hundreds of such consumer blacklists under such sections as

    Check Verification firms



    being the two most notable

    Tenant Screening Companies

    literally hundreds and covering the whole USA

    http://ntnnet.com/ and their affliate www.e-screening.net

    I suppose a case can be made for Employment Screening Services

    But I have severe doubts about the ethics and validity of those running the numerous "bad consumer" blacklists such as
    who dispense sub-prime consumer information.

    And of course CardReport.com has commented on the blacklists the Utilities maintain and distribute.

    Now with the exception of the latter all are covered by FCRA.

    Now according to the FCRA

    All credit bureaus, including specialized tenant screening, check verification and
    medical information bureaus, are subject to requirements to ensure accuracy and protect privacy and new deadlines for re-investigating disputes. Bureaus are required to consider information provided by the consumer in their
    error re-investigations.

    But as I stated in my original post, with the exception of such major one's as ChexSystems who have come under so much scrutinty there is rarely any pressure on any of these to make sure the information is valid and correct and once on these lists you're liable to remain there for life as tens of thousands of victimized tenants know all to well.

    As for your own case, I cannot see this being a factor as these blacklists do not grant credit they are just used by creditors to look for further negative information on consumer's and reject people based on that.

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