patrick.net

I finally got off of the fence, dove in, and got a new credit card after not having credit cards for about 3 years or so. Why did I do it? Because I need to get my credit score back up. Credit scores shouldn't be used as part of a background check for employment. That's not fair. If I don't need money, I don't need to work. A low credit score should mean that I really need the job and not be denied the job. The banks and credit wonks shouldn't be able to reach into my life to control what labor opportunities are open to me. That is a criminal practice that needs to stop.

So, what credit card did I get?

Well, I'm in the process from dumping Chase completely. I had credit cards with them and I was paying on time every month until they suddenly increased my interest rates to 30% and increased my monthly payments forcing me into default and then debt settlement. At least I had the resources to be able to follow through with debt settlement so I could avoid bankruptcy. The criminal tactic that was used against me was "universal default." Even though I was able to make my monthly payments (bringing down my principal balance and paying interest) they thought my debt to income ratio was too high. So they placed me in the "high risk" pool forcing me to choose between rent or credit card payments. Guess which one won...

The irony is that they "protect" themselves from "risk" by jacking up rates and payments to levels that consumers can't possibly afford forcing us into default. They do nothing to help consumers pay back the loans, as I was doing before they "intervened" on their own behalf by forcing me into default, ruining my credit.

So I joined my employer's credit union. Now I will have the opportunity to earn better interest for savings and get credit at better rates. Also I'm not contributing to the largesse of one of the criminal "too big to fail" thugs that has wrecked our economy, JP Morgan Chase.

I applied for a secured Master Card. I have a $300 limit. Therefore I keep $300 in an inaccessible account with my credit union earning interest. The interest rate on my secured card is a beautiful 10.15%. In six months or so, I may get an "unsecured" card if I so choose. I'm not sure I want one again but I may require it to build my credit score so that I'm not held back by the criminal practice of potential employers poking their noses into my business by using my credit score to help them make hiring decisions.

The current "regulations" that have "passed" house and senate do nothing to protect the consumers against any of these criminal practices that ruined my ability to pay off my loans in a straight forward way without screwing up my credit. I was plugging along just fine until Chase changed the contract on a whim without notice knowing that I had no power to negotiate until I was well into default. They won't deal with you until you are in default and they've ruined your credit. That's the fact.

It's not a level playing field when it comes to credit. The big banks have our government in their pockets and we the consumers are left to fend for ourselves. I don't see an easy way of changing this.

@simchaland
You should get several cards, because 40 or 60% of your score comes from how much credit you're using. So if you've got a $500 balance and have $50,000 in credit cards, you're in better shape than someone with $300 on a $500 credit limit. Not to mention, the different cards then try and get you to use their cards with "deals" although, less so now. So if you do get into a pickle, like happened to you, you could transfer away from the problem cards onto something better.

Having the cards isn't bad, using them to buy more than you can afford is bad. You can play their games as well, I've taken 50+K out at a time and put it in interest bearing accounts while they gave it to me for 0%. I didn't get a chance to fully abuse the system with a good 100K loan like many I knew were able to do. Borrowing 100K for $50 for a year. Not bad.

simchaland says

Credit scores shouldn’t be used as part of a background check for employment. That’s not fair. If I don’t need money, I don’t need to work

LOL! I agree and if they do implement that policy it should be retroactive. God almighty, there are people at hiring managers in sr. positions who would fail it at the blink of an eye. Should be fair either way.

yes, like i said.. "200+" .... at a 500+ we are talking audit and sox/internal control review by partner.
Tax isnt as much as audits... That is why many corporations are switching to smaller non big 4 lesser known firms for both audits and tax work.

"who says there’s no inflation."

No not overall inflation, the audit engagment as well as tax prep is prearranged as a fixed price contract with the audit committees ahead of the year. So for many public and non-public entities dont get a unkown bill at year end based solely on hours. Yes, hours are disclosed in details, but the accounting firms do eat hourly cost overruns and are not passed to client, else we go elsewhere. Not to mention, prices are negotiable, its not a take it or leave it situation. Many have switched to other cheaper firms. SOX however has added additional layers of services and accounting firm risks which has inflated hourly and fixed contract services.

If your a staffer or sr staffer, as well as audit manager, your pretty much working 12 hours a day regardless of rates.
Somethings never change! We are talking about 80-90% or more of the employees.

Companies often want to know you behave like a "normal" person. Normal people, handle situations in a "normal" way, which means people can easily identify when there is a problem. Credit score is really just to check up if you're normal or not.

Also, if you're in a dire situation, you could be more likely to take risks and/or do unlawful things to get yourself out. Lots of reasons to use credit scores.

pkennedy says

Companies often want to know you behave like a “normal” person. Normal people, handle situations in a “normal” way, which means people can easily identify when there is a problem. Credit score is really just to check up if you’re normal or not

And the norm may include getting divorced which leads to kinds of 'credit score" issues, garnishment of wages, laywers, blah blah blah. How do you define normal anyway? Just another crazy East Coast Liberal mentality infecting California.

Pkennedy,

Unfortunately, since my credit is so hosed at the moment, I have to start small and work my way up to multiple cards, if I so desire. The benefit of having done debt settlement instead of bankruptcy is that those accounts will slide off at 2013. Settlements are on your credit report for only 4 years. So, as I slowly re-establish credit and I show that I pay off my card every month, my score should improve.

I would have thought that finishing paying off my car loan, on which I never had a late payment, would have helped my credit score. Ironically, it didn't seem to help much. Oh well...

@simchaland
Yeah well many things are odd about the credit scores. Just remember that keeping additional cards around isn't bad, and often helps things out. Also apply to a bunch of places, it'll help your score a bit, it will take it down as well initially, but will show activity. Also, next time, try and keep your oldest accounts open, the length of your credit is important too... even though it's temping to shut down a bunch of cards because they pissed you off, it's better to just shelve the cards.

@thomas
Normal is whatever you define normal as being. I've found that succeeding isn't hard. We all do that, failing is in fact hard. Not in failing itself, that is easy. In HOW we fail. Do we curl up in a ball and tell no one. Do we work diligently and try and sort out the mess, without ever telling anyone? Do we break down crying and just quit? Managers can't do much if you just silently fail on them, they need to know WHEN you're in trouble and they need to be able to see that easily. If you behave "normally" hopefully they can catch that. So maybe the credit score doesn't give an exact picture, but it does paint a decent picture of who you are. Especially when you compare it with your resume, work history, references and conversations. I'm sure we've all seen an employee hired that sounded awesome on paper and did great in interviews only to find out they're miserable to work with or completely incompetent. Hiring/firing someone isn't cheap, it might be easy, but it isn't cheap. Undoing the mistakes, finding someone new, training them, etc.

Pkennedy,

Yes, this is why I've left a department store credit card open that didn't get closed. All the rest of my cards were closed involuntarily.

And I honestly have to say that my work performance has absolutely nothing to do with my credit score at all. I do well enough at my job and I'm not in danger of losing it for performance reasons at all. If I were to lose my job, it would be because our program closed due to budget cuts.

usery should be outlawed.

States may apply whatever laws they want on businesses.There may be a Federal Law or two but states have all kinds of laws for zoning, taxes, permits , etc. so at the end of the day, the States can decide.

marko says

States may apply whatever laws they want on businesses.There may be a Federal Law or two but states have all kinds of laws for zoning, taxes, permits , etc. so at the end of the day, the States can decide.

Sorry, but that is totally wrong.

What good is a state rate cap, when someone from Florida (18% rate cap) can just sign up for a credit card with with a company incorporated in Delaware (no rate cap)?

The question is will congress use it's power to regulate interstate commerce?

As it stands, the supreme court has affirmed a Delaware bank (extremely corporate friendly) can do business anywhere in the country, unless congress steps in.

MarkInSF says

marko says

States may apply whatever laws they want on businesses.There may be a Federal Law or two but states have all kinds of laws for zoning, taxes, permits , etc. so at the end of the day, the States can decide.

Sorry, but that is totally wrong.
What good is a state rate cap, when someone from Florida (18% rate cap) can just sign up for a credit card with with a company incorporated in Delaware (no rate cap)?
The question is will congress use it’s power to regulate interstate commerce?
As it stands, the supreme court has affirmed a Delaware bank (extremely corporate friendly) can do business anywhere in the country, unless congress steps in.

Well what good a rate cap is depends on performance benefits overall . For the argument, a State can impose whatever cap they want.

say anybody should be able to request as much interest payment as they want.

But they shouldn’t come crying to government run courts and police to be the enforcer of those contracts.

What other recourse would you recommend to enforce a legal business contract? If you own rental property and charge an "above market" rent, if your tenant refuses to pay you rent and refuses to move out, do you think government run courts should "butt out" and not help you evict them? Please.

Ah, but PKennedy, Bill Gross has defined the "New Normal". There is a new normal but banks always try to win no matter how many bad loans they make. They make bad loans to consumers, to countries, and they always think they can make their money back. But really they know that they will be bailed out. Have a TBTF bank around and you can blow new bubbles. Then let the IMF come in and clean things up if social revolution doesn't happen first

Zippy, if you charge above market rent you are a greedy sob. But with rent, buyer beware.

This use of credit scores to determine who gets a job is not for the benefit of the employer, it is for the benefit of the banks.

While some could say Tim the thief Geithner was ill prepared to be secretary of the treasury, he was qualified as a Federal Reserve Private Bank mole, and it didn't matter if he paid his taxes.

Here's an Idea, save your money, and don't use credit cards.

Geesh people this is a no brainier. The only people upset over credit card rules are the people that shouldn't be using them in the first place.

If you have money, credit cards are great. No carrying around large sums of cash, debit is okay, but then you need to leave large sums of cash in a non interest baring account. They also offer some great benefits, and rewards.

If you're poor, they offer a buffer zone for really bad times when you might need extra cash to bridge some gaps.

If you're poor or rich and spend beyond your means, they're just going to chew you apart, poor just don't have a way to dig themselves out, while the rich can make life changes to do it if they are so inclined.

It just isn't practical anymore to do without one, unless you've got large amounts of cash stored up. That being said, anyone "requiring" more than a 30% interest rate (even 30% seems bad) probably shouldn't have one as they've obviously failed financially so badly in the past. If the bank can't make it profitable without dropping massive rates on them, then they shouldn't be giving them credit, it's simply irresponsible of them. It's obvious these people can't handle credit properly at any level and they aren't using it as a stop gap, but rather a source of income, with far too many defaulting.

"If you’re poor, they offer a buffer zone for really bad times when you might need extra cash to bridge some gaps."

Worst idea ever, unless you are "Carnac the Magnificent".

I have here an envelope [places by his head] What is a bill I can pay next month?

If you suddenly have a car break down and don't have the savings to fix, a credit card is the only way to get a small short term loan. If you've got a bill every month that can't be covered, then you're just using the credit card for a source of income.

It's exactly the purpose of short term loans, and exactly what they're used for.

pkennedy says

If you suddenly have a car break down and don’t have the savings to fix, a credit card is the only way to get a small short term loan. If you’ve got a bill every month that can’t be covered, then you’re just using the credit card for a source of income.

gasp! well if you don't have savings, then you don't have savings for a reason.
And that reason is certainly affordability. Having/(more like Using) Credit only compounds this problem.
And dare I say only perpetuates both lack of affordability and the lack of savings.

Credit is not a suitable replacement for better employment.

GaryA says

This use of credit scores to determine who gets a job is not for the benefit of the employer, it is for the benefit of the banks.

Sorry I don't follow?

"Who on earth things the ruling regime/party that includes the architects of failure like Chris Dodd and Barney Frank would anything but try and hurt the middle class law abiding tax paying citizen-subject?"

Deluded fools would think so. Remember, Chris Dodd gave us such brilliant insights as "it's the housing market that brought us into this mess, it's the housing market that will bring us out" (paraphrase).

If that is the level of mind advancing our economic policy, then we're gonna need a bigger brain.

As for credit card caps, I'm all for it. In an ideal world, it wouldn't matter if an idiot doesn't read the contract and signs up for a lifetime of debt and is now paying XX% interest. But in the new world, it seems contracts between idiots and the banks have become my problem too. And yours. And Greece's. If banks can lend to any fool and seek help from the taxpayer when said fool defaults, then yes, we need a damn cap.

Geesh people this is a no brainier. The only people upset over credit card rules are the people that shouldn’t be using them in the first place.

False. I have never in my life carried a balance on a credit card, but I think legal limits should be placed on the extension of credit.

Here’s an Idea, save your money, and don’t use credit cards.

You could make the same argument about somebody opening up a corner shop selling pre-filled syringes of heroin, kiddie corner to the pay-day-loan shop. "Hey, here's an idea, don't use heroin!"

Liz Pendens says

GaryA says

This use of credit scores to determine who gets a job is not for the benefit of the employer, it is for the benefit of the banks.

Sorry I don’t follow?

Liz, this credit score usage for employment insures that many people continue to pay their credit cards even though they can't afford them. That benefits the banks!

Of course, 8 million people are now not paying a dime on their mortgages, but they are keeping their credit cards. Hmmmm.

Employers aren't going to care about banks. If they find a good candidate, they're going to hire them.

If the credit report shows something bad, they might second guess their decisions. If you can't manage your own finances, can you manage theirs? Will you hide things from them? Will you do similar things to, when you make a mistake will you correct your problem or keep doing something wrong instead of making a hard choice? It could point to a lot of issues with a possible employee. While comparing the people with criminals isn't exactly appropriate it does show a point. If a criminal has done his time and been released are you going to hire him as likely as someone who hasn't been to jail? Why take the risk that they might relapse. They've already done it once, the second time might be easier. They were stupid enough to get caught, etc.

If you've got financial issues, maybe you're going to cause them hardships in some way in the future.

I agree, if you can't manage your own finance, how on earth would you manage task and projects. Of course, whether credit scores matter depends on the responsibility of the position. Most positions would not matter. A bad credit score reflects badly on the prospectively employee and in this economy, every little detail counts. Of course if you can bring in a 1M in sales, nobody cares about these minor details.

For those that say credit score should not matter, it should. If you miss a bill, you miss a bill and that is the bottom line. This is a result oriented society and failure is failure no matter how that failure came about.

MarkInSF says

Geesh people this is a no brainier. The only people upset over credit card rules are the people that shouldn’t be using them in the first place.

False. I have never in my life carried a balance on a credit card, but I think legal limits should be placed on the extension of credit.

Here’s an Idea, save your money, and don’t use credit cards.

You could make the same argument about somebody opening up a corner shop selling pre-filled syringes of heroin, kiddie corner to the pay-day-loan shop. “Hey, here’s an idea, don’t use heroin!”

Heroin and Money! My God aren't you are a whinny "will Uncle Sam Please wipe my Ass?" lot!

libertarians never think things through

when people are in high debt they cant pay rent-go to shelters
landlord isn' paid-harms local economy
can't pay mortgage-abandoned houses
are not the best parents, too stressed-kids go to school without proper clothes/supplies
don't eat well, health problems
can't buy legitimate goods and services, harms local economy
This all harms the whole country and costs the gov't too
Many in local gov't know this and try to pass laws but states and Fed over-rule them...See Cleveland Ohio and predatory lending

Who put these credit report people in charge? We didn't elect them and didn't agree to this.

When foreclosures started I thought that everyone's score would be ruined and we would get a chance to throw off this yoke

they are like Big Brother

by the way I had a secured card, so $500 in bank plus 120 in checking...bill went to my old apt? or lost? ...didnt owe on the card, but they charged a yearly fee of $25 then a month later $20 late fee, only then they phoned me..When I called back to change my address they said I have to send a fax as they dont believe me.. so I probably get dinged for that..

"by the way I had a secured card, so $500 in bank plus 120 in checking…bill went to my old apt? or lost? …didnt owe on the card, but they charged a yearly fee of $25 then a month later $20 late fee, only then they phoned me..When I called back to change my address they said I have to send a fax as they dont believe me.. so I probably get dinged for that.."

In the end, it is your still your responsibility. Really, all the circumstances are just excuses.

Tenouncetrout says

My God aren’t you are a whinny “will Uncle Sam Please wipe my Ass?” lot!

The government does not have to do anything. And it doesn't have to "babysit" anybody as Nomo says. It just makes contacts that involve high interest loans not have legal status. Not to compare credit cards to slavery, but the government didn't have to do much of anything to end slavery. Mostly just just said that contracts involving slavery have no legal status, and the state cannot be involved in enforcing them.

High interest credit cards, pay-day loans and the like are almost always harmful to the borrower. So why do we allow them?

Well, we allow cigarettes, right? Personal responsibility and all that?

However, the government is not involved in selling cigarettes. It most definitely is involved in the credit card business. When you sign a credit card contract, the state is an implicit 3rd party to that contract when it recognizes it as having legal status. Based on it's involvement, the state has the power and obligation to grant claim on a debtors assets to unsecured creditors, and in some states your wages may be garnished.

I really don't know why the state should be helping a company provide a "service" that is harmful to it's citizens.

In other words everyone deserves instant risk free gratification.

Credit unworthy people deserve mounds and pile of credit, but they don't deserve risk mitigation of fees and rates?

Well what if the credit card companies just stop giving out cheap credit, unless those customers proved the past three months of employment, and other financial proof. Say the credit card companies ask for proof quarterly to continue their credit line with you.

Nah that wouldn't be fair either, would it?

Everybody is innocent, and nobody is accountable, it's the Goddamn banks fault.

ZippyDDoodah says

What other recourse would you recommend to enforce a legal business contract? If you own rental property and charge an “above market” rent, if your tenant refuses to pay you rent and refuses to move out, do you think government run courts should “butt out” and not help you evict them? Please.

If the lease is not a valid contract for some reason, then it's as if it doesn't exist in the eyes of the court. The landlord still has legal recourse, since it's his property.

Tenouncetrout says

In other words everyone deserves instant risk free gratification.

I most definitely did not say that, or even agree with it.

I'm just saying if you're a creditor, don't come crying to the Uncle Sam to wipe your ass if you're a high interest lender and they don't pay, and don't expect them to help you collect.

I agree, the world would be a better place if both the thieves and their Victims were left up to the free market forces. Instead of demonizing one, and bailing out both.

Tim Geithner didn't pay his taxes. Yet he is needed by the New World Order to keep the crony financial system together. So much for running a credit report on him!

I don't buy that personal financial trouble translates into the inability to do work competently and honestly. Trust me, this is about the banks keeping people paying crap loans back.

GaryA says

I don’t buy that personal financial trouble translates into the inability to do work competently and honestly. Trust me, this is about the banks keeping people paying crap loans back.

My solution is simple, I charge 20% more per hour or yearly Salary, for Credit report requirements, and 20% for background checks, and I'll piss in a cup if they'll drink it.

Try not to work for such companies, then Wallmart wont grow so strong to be the only employer you can find.

I manage just fine to avoid such intrusions from employers, and wouldn't want to work for those that do have those policies.

You forget people are willing Slaves, employer based Healthcare is full proof of that. I predict at this rate, the majority of Americans will be like 1849 West Virginia Coal Miners, every day you wake up you're more in debt to the company store. And if you don't like they'll call in the Pinkertos and mow the camp down and replace all of the corpses with those at the fence looking in, wanting work.

Ha, how true Tenounce. BTW I started a new thread about fighting the NWO. It is a good article.

The ponzi banks wanted ponzi and usury and their greed was evident. They also knew they would be bailed out. Then they get the house back in the end. What crimes here!