October, 2017
Under served communities often do not understand that a credit score is a numerical measurement of credit worthiness. Scores can range from 300-850, determined by the information of a personalized credit report, which is based on bill payment history and is key to obtaining credit in the United States. Good credit is a key factor to creating a certain standard of life in America, a better life – even for those not under served.
Underserved communities often do not understand that a credit score is a numerical measurement of credit worthiness. Scores can range from 300-850, determined by the information of a personalized credit report, which is based on bill payment history and is key to obtaining credit in the United States. Good credit is a key factor to creating a certain standard of like in America, a better life – even for those not underserved.
There are three credit reporting bureaus from which a credit report can be obtained: Experian, TransUnion and Equifax. They sometimes have slightly differing scores but in the end the score used by a particular creditor is the one they get from the credit bureau they choose to pull the report from.
For the average American, the credit report is the single most powerful tool to gain access to a home, car, loans, and an overall lifestyle that is not attainable with a bad credit score or no credit score. Credit reports can even be pulled and used by employers, and is at times, as a criteria for being employed there .
Senator Elizabeth Warren has proposed legislation to illegalize credit report pulling, with only specific exceptions, as a criteria for employment. She is adamant that people should not be barred from employment because they did not have enough money to pay their bills and objects the idea that employers should be able to use a credit report as a judgement of character. There is a twisting irony in keeping people who cannot pay their bills unemployed because of it.
Another terrible disadvantage in America’s credit bureau system is how important it is to have good credit, yet the education system almost never mention the words credit, credit reporting or credit scores to students in their academic journey. This creates a significant amount of people who are not credit report educated and who sometimes had no idea about its scores until maybe an application was denied because of low or bad credit score.
Not only could knowledge help people to make better and more careful decisions when it comes to how it would effect their credit score but a credit educated population could also understand how to build up a credit score.
U.S. Representative Maxine Waters has introduced a bill to address some credit reporting issues such as: length of time a negative report can remain on a person’s report, the dispute process and other proposed monitoring laws.
If credit is the key to a good American life, then it is time for all to have access to understanding it and for fair credit reporting rules. Really, is someone of bad character if medical bills sunk their finances? Oh yea, we still have an insecured health care system so this is still possible.
It will take new legislation and curriculum inclusiveness, to address credit report education and fair laws that govern the reporting bureaus before people of underserved communities get a shot at creating a good credit score.
