The FACT Act of 2003: Notice and Request For Public Comment On the Effects of Credit Scores and Credit-Based Insurance Scores on the Availability and Affordability of Financial Products
Credit and insurance does not go hand in hand. This type of co-mingling keeps drivers from purchasing car insurance. NJ has the worst rates for car insurance already especially in the urban areas. Because someone may have defaulted on a credit card does not mean they will not pay their car insurance. The car insurance/credit score situation keeps hard working people from getting car insurance at reasonable rates. Now credit scores in a whole is not a bad thing. It is when credit card companies only look at the score to get a picture of the person applying for credit. The fact that 6 years ago, I did not pay a credit card and maybe had late payments, does not mean that over 6 years later I have not established myself as a responsible person willing to pay my debts. And considering that credit reporting agencies rely on information from scrupulous collection agencies, it is hard to rebuild credit. The FTC guidelines should be more consumer friendly in that respect. Paying a debt off should not "restart" the clock of reporting. After 2-3 years late payments should become null and void if good payment history is re-established. Variations of names and address' and social security numbers should not be harder than giving birth to have removed. Investigations should be just that --- investigations, not verification. Given the number of complaints by consumers on agencies such as the FTC website and Better Business Bureau, collection agencies should be "red" flagged when a consumer complains of inaccurate reporting. Also, once a consumer request investigations of inaccurate reporting for any debt collector, that investigation should result in that tradelines score to be removed fromt he overall score module. I for one have had credit problems in the past. I was young and had a child. I had a job making minimum wage and going to college. I hit many rough spots and that resulted in credit cards being charged off. But that does not make me a bad person. I have since finished shcool and got a real good job. And because of the bad decisions I made over 5-6 years ago, I am unable to buy a home, get a decent auto loan rate, get decent car insurance rates or get a prime credit card. Because I chose to feed my child instead of amking the minimum payment on a credit card chargin over 19% interest in the first place, I can not be a homeowner. And I have since paid off 95% of the old credit cards and I am in maybe worst shape than I was 5 years ago because once I paid everything, it started the clock again. I understand that credit is abused everyday, but honest people willing to pay their debts should not have it this hard to re-establish themselves.