Credit Reports

Are "credit reports" choosing the future "elite"? To many this may sound silly but this may soon be a reality we all must face. Credit could likely be one of the biggest factors in our countries current economic crisis and credit reports are creating a very near future where only those with a "good" credit score can own or rent homes, buy cars, open bank accounts, shop, or even.....work.

More and more companies are doing "pre-employment credit checks". According to the Credit Scoring Site, an employment report provides everything a regular credit report does, without the actual credit score or date of birth. Yet, potential employers can basically see your entire debt history, although you, depending on a paycheck from them, may not see their financial secrets. One has to wonder if the companies now getting "bailed out" by the government - did credit checks on their employees while apparently having financial difficulties of their own.

Could the use of credit checks be one cause for the rising unemployment numbers? We could be moving into a vicious cycle with more people falling behind on payments at this time and more employers doing credit checks to determine a person's hiring desirability.

Also, many opponents to the use of pre-employment credit checks worry about the ability to "profile" or "discriminate" against people of certain races etc. through their credit history. In essence, those who do credit checks are discriminating against every individual, no matter race or color, who does not have a perfect credit rating. You can not judge any individuals ability to be a good employee by their personal finances, as how you spend your money has nothing to do with how you earn it, therefore the only possible reason to actually do a credit check would be to exclude people off a bias created by what I call "economic snobbery".

The complete power given to the credit bureaus is almost frightening. Our entire lives now depend on their reports, right or wrong. Common sense and good judgment no longer have a place in our world. The dependency on a company's computerized version of a person's life has completely replaced the need to utilize any normal human caution, discretion, or intellect. It is impossible to see the nature of a person by the credit check. The information provided is often outdated, completely inaccurate, misleading (many credit checks show the same account over and over making it appear as several), and can often indicate nothing more than a person's priorities.

If Mr. Renter goes in to rent an apartment but is denied because he may have faulted on a car loan, someone using basic common sense would look to see if Mr. Renter always paid his rent, regardless of what else does or does not get paid, and would understand that if Mr. Renter had perfect credit, he would not be renting. Same if Mr. Homebuyer wants to buy a home. Some people will sacrifice all else to pay for their home, some will sacrifice paying for their home to have toys.

Consumer laws in individual states vary and some have opened up entire new methods for people to be victims of "legalized" crime through the use of collection agencies. Identity theft is also a continuing and rising problem which impacts a victim's credit report. The Identity Theft Resource Center lists data breaches concerning Identity theft. According to the ITRC, the criminal population is stealing more and more data from companies. This "data" is often our most personal information. The information provided on their website is enough to wake anyone up to the flaws in the system. I suggest anyone go to their high profile breaches link just to get an idea how vulnerable we all are.

Our own government is probably one of most prevalent reasons for low credit scores, as any "debt" claimed by the IRS or a State Revenue department will result in instant low standing on your credit report. No entity or person needs your permission to put something against your credit, yet it is up to you to spend hours and hours fighting to get things removed. The average American has enough stress and hours each day just trying to survive without the added stress of trying to repair an inaccurate credit report. According to a 2002 report by the Consumer Federation of America, millions of Americans are jeopardized by inaccurate credit scores.

How does the use of credit reports create an "elite" class? If a credit report is used to rent/own a home, to get a job, to open a bank account and to own a credit card which is quickly replacing the use of cash, and even used to determine the cost of your insurance, where does that leave the millions of Americans whose credit score does not have a gold star next to it?

Many will be forced to live with relatives or on the streets. Even if they manage to get a home, they will be unable to get utilities for their home as even utility companies do credit checks. They will have no transportation or will not be able to afford the government mandated insurance to drive one. Because of the inability to get a good job with benefits, people with low credit scores will be forced to work only the most menial of jobs. If they receive a paycheck instead of cash, they will only be able to cash it by paying someone a fee to cash their check. They will be unable to travel or rent hotels as they have no credit cards. Soon they will be unable to even shop as more and more stores move further away from the inconvience of a cash system. They will become completely dependant on others or the government to survive - or a new black market will rise up from the gutters of necessity.

I think we must fight to not have our opportunities in the "land of opportunities" taken away from us by a faulty, over used, over pumped system. There was a day when a man/woman was judged simply by the way they interacted with individuals, bankers, etc. We need to demand this right by refusing to allow employers to do "pre-employment credit checks" (in fact employers should never have your social security number until after you are hired), or insurance companies to use credit reports to determine our premium. We should insist on legislature that makes a person or entity first prove you owe them (instead of you proving you don't) before they can place something on your credit report, and legislature to make it illegal to change a person's score because of attempts to obtain credit. Often these attempts can be fraudulent. The only "credit" report available to each inquirer should be only that which pertains to them, i.e. mortgage companies should only know your mortgage or rent history, car companies should only know your car history, etc.

When did we get so upside down to where the "have not's" (those who live on credit) became the "haves" and the "haves" (those who pay for what they have) became the" have not's"? I see many people putting on airs as they move through life in their expensive cars, huge, over done homes, designer clothing, diamonds and "bling", with luxuries unimaginable - all purchased - on credit. Lavish lifestyles they really could not afford, and yet, they will look down at the man who lives on only that which he can pay for. For those who have placed themselves on this pedestal of illusion - remember - one mistake, one wrong report, one number off - you could find yourself falling quickly from grace to join the millions who are not part of the "elite". The biggest mistake people make when a country is moving towards elitism is to assume, in their arrogance, that they will be part of the "elite". Chances are - most of us will be in the soup line together. The secret to the greatness that was once America was opportunity for all.

Note: Mr. Renter and Mr. Homeowner are fictitious characters. :)

Elitism: n.

1. The belief that certain persons or members of certain classes or groups deserve favored treatment by virtue of their perceived superiority, as in intellect, social status, or financial resources.

2. a. The sense of entitlement enjoyed by such a group or class b. Control, rule, or domination by such a group or class.

Sources: Identity Theft
Credit Scoring
Employee Credit Checks; Charles Cooper
Elitism