Credit Reference Agencies-An Unfair system

ARCH 4, 2018 EDIT"CREDIT REFERENCE AGENCIES – AN UNEVEN AND UNFAIR SYSTEM."

Credit Reference Agencies – An uneven and unfair system.

Now Im not one for trying to push forward my own political agenda onto people. So in this article I am not pushing the blame at any one politcal party as this problem has been there for some time. looking at facebook I can see people have entrenched political views and that stems from upbrining, background and life choices. My biggest problem has not been with any political party in the UK, it has been with the system itself. Now what is a credit reference agency, well you would think it is an impartial organisation that gives you a decision based on certain factors. In some ways that is correct it will make decisions based on a persons background, a process they call credit scoring. The problem is with this system is that you have to have good credit to begin with. But how do you get it?

The system itself bases a decision based on being able to ofset a risk against a gurrantor. So in theory the way to get good credit is to try to take out a slow attitude to credit. It might also take two years from beginning to end to achieve the result. Most people think that their household bills generte good credit, apart from british gas I cannot think of any utilities that check the information. Basically my advice for good credit is to create one or two saving accounts and keep a balance active in your bank. So for instance you save 1000 in two savings accounts and then in your main account use a balance but always keep a float. Thats how to build up credit.

now you may ask what is my problem with credit reference agencies? I feel they are flawed , its a deeply rooted thing in my pschye in that at the age of 20 I had worked for three years with bank statements , no overdraft facilities used. I went to university and mainly a bank in the Uk called Natwest really affected my opinion of banks, credit. Now on the whole Natwest were a responsible bank and I never had any arguments. But what I found was there was people starting at univerity at the same time. They would be with the same bank but would have additional facilities. So I was the same age, with a working background, no adverse credit. So ultimately the decision of credit was linked to a family member.
On the other hand in 1996 I changed bank and was given a credit card and bank account with no main checks(HSBC), so they probably got around the credit system to hit targets.

So basically my first point is basically fianancial oragnisations can alter credit decisions when they enter the applications. So all though a individual has done things right there end, a organisation can alter the information to suit there targets. So in some ways people get credit that are not truly expected to get it. But on the other hand companies can make reprentations to agencies knowing that they will not get credit but the organisations will hit a targets.

My second point is that financial organiations like experian as an example are linked to other companies. I am sure but might be wrong here, but experian was linked to the great universal cataolgue group who in turn where owned by Argos. All though I understand that might have now changed. So people would be applying for credit with said companies and be rejected and have their files affected.

The thrid point is that I feel a sense of injustice to the whole thing about credit, a few years ago I was working in a holiday camp a couple were saving left right and centre trying to get their own home. Combining their income and savings, they keeped on getting rejected. This comes down in part to the property system, but ultimately the property system is linked to the credit reference system. So its almost like an exclusive club for the wealthy.

This is where the real crux of what I am getting at. A person with no credit history can with the reight decisions get an umlimited amount of credit, with little income. Where as a couple with a combined income of say 25000(2 lots of 12500) are not able to obtain credit. This just strikes me as completely and utterly mad.

On a personal level I have to state that my resentment of credit companies does not stem from rejections in the past. Its an over riding concern and annoyance I have had going on for 30+ years. It started at university in that I could see a ‘have and have not kind ‘of banking system. So when I finished university I did not want to go into a mortgage vs job scenario. Luckily my wife feels the same, all thought owning a house outright is a dream. We know the systems that are in place do not help and realitically there is no chance.