What is my dealer up to?

That was nice of your dad. I hope you're paying your part of the insurance too.....I say this as a parent

 

I just started doing the same thing. It's a good practice to cut down on the possibility of identity theft and keep people like dealerships out of your credit report.

 

Dang!

You are fortunate. My parents wouldn't have done that. Of course, I was 19 in 1986 and things were a little different back then.

I forgot to say, the Toyota Financing place sent me a letter stating they denied my loan through them...I was like, "I broke up with you!"

It's some formality to explain why I didn't finance through them.

It's water under the bridge now. I'm loving my Taco!

Ed

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Ya I do it mostly for protection against identity theft, too. 95% of Lifelock's identity theft protection service is just having you lock your credit lol

 

Still shitty on their behalf to not explain the contract. My salesman explained ALL of the paperwork in exquisite detail before we signed them.

 

My parents do. They’re extremely paranoid about applying for credit cards and loans.

 

I had mine locked. My bank that gave me the less than 2% interest asked me to unlock it so I could get the credit check. I must have locked it after the dealership did a soft credit check.

Ed

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Of course, the policy increased by $60 once my dad added me to it.

 

Live and learn.

My FICO score is back up over 830 now.

Ed

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$60 total isn't too bad every 6 months (my policy renews every 6 months)...that's $10 per month...chump change for you young people. lol

Ed

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Big reason I freeze mine is because I know a guy who's identity was stolen a few years back. Thieves went on to take a home equity loan out in his name. Not too sure of the specifics but 5 years later he's still dealing with that shit. Your parents are probably cautious for similar reasons.

 

Ther's no such thing as a Credit Score. The correct terminology should be "Debt score" or how prime are you to sign up for financing. All a scam if you ask me.

 

I just made sure my credit file is LOCKED. I pay to have my credit monitored through my bank.

Thanks for the dialogue!

Ed

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FICO Score is a scoring model that is used to predict behavior and mitigate risk. Has nothing to do with your being "prime to sign up for financing". There are multiple models by industry (consumer, automotive, mortgage, etc), so your score when you apply for a car loan will probably not be the same as your score when you apply for a credit card. Fair Isaac Corporation does about $1.2 billion in revenue a year, so if it's a scam it's a damn good one.

 

ok so I dumbed it down a little. IMO It's still a predictor of available liablility (ie.. this guy likes to finance shit) and likeliness to be able to pay it off. Your explanation was a bit more accurate technically.

 

This is GREAT dialogue...one of the benefits of being on a forum.

Ed

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Ahh ok I get it now. It does consider how much debt you have outstanding (utilization percentage), how much you've applied for recently (inquiries over the past 2 years and average age of accounts), and looks at your payment history to determine how likely you are to pay as agreed. Mix those factors all together, weight it based on their algorithm, and presto....a FICO score. The biggest advantage to scoring models is what I don't like about them. They allow for much of the lending process including the credit decision to be automated, thus taking the human factor completely out of the process. Years ago I was a mortgage underwriter, before risk scores were widely used. We actually looked at a credit file and made decisions. When someone had dinged up credit we actually tried to determine why. I looked at someone who had an identifiable issue at a particular point in time....divorce, serious medical issues, etc.....and had good credit before and after the event a lot differently than someone who was just sloppy in paying their bills on time. A scoring model can't do that. A dead beat gets the same score as someone who had a one-time identifiable problem and whose circumstances have now changed. Now what credit costs you, and whether you get it at all, lives and dies by that number.

 

Very well said!

 

This thread sparked me to check my free credit reports. I love it -- I don't have a credit report! In 2014 I paid off my mortgage and I have never had a credit card (and I'm in my 50's.) Only 1 of the agencies even knows I exist, and they just report a paid off mortgage.

When you borrow money you are doing the lender a favor -- they are NOT serving you. They are helping their bottom line!

 

I'm 55 and had an AT&T calling card during my first assignment in the US Air Force in 1986...which subsequently turned into a credit card.

Let's just say, I was not using credit to my advantage. Fast forward to this year and my wife and I are credit card debt-free. So much of what we bought during our early 30+ years of marriage was "wants" instead of "needs". We've been critical of ourselves and of course had peaks and valleys with regards to money.

We were able to refinance our mortgage prior to my Tacoma purchase this year and putting our money in IRA/Mutuals/Savings. It's taken some time but we feel very happy about the successes in our financial goals.

Ed

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