Remember in school whenever you did something bad, or got into a fight, or stole a kid's action figure, or cheated on a test, or slept through a test that whatever the infraction was it would Go on Your Permanent Record? (Well, personally that never happened to me but I saw enough 80s Teen movies to share in the gestalt.) As adults we are faced with a new form of the Permanent Record: The Credit Report.
Constantly reminded by those commercials of that guy selling "chowder and ice tea" a man's credit report is the civilized yardstick by which all self-worth is measured. Not only does bad credit mean you will be denied access to housing and employment and any chance of the American Dream it also means women will not like you, friends will find you less humorous, your junk will possibly rot off, you will be confined to a life of crack smoking, and quite possibly Zeus will strike you down with a lighting bolt if ever turned over to a collection agency.
And the best part is that this all important metric of your Adult Being is maintained and controlled by Private Corporations who make up the rules as they go along.
Case in point, Bob Sullivan's Red Tape Blog on MSNBC today had a story on how a reporting error by the student loan firm Sallie Mae " temporarily wrecked the credit scores of a million loan holders, with some victims saying their scores had sunk 100 points or more."
. Sallie Mae's change caused the bureaus to view those on graduated payments as “arrangements made with credit grantor to make partial payments." That sounded to the credit bureaus as if the borrowers had signed up for a reduced payment plan after being delinquent, which carries with it a serious credit score stigma.
Sallie Mae spokeswoman Martha Holler said the glitch affected “roughly 10 percent of our 10 million customers.”
Bob Sullivan goes on to talk to John Ulzheimer -- he helped design Fair Isaac's credit scoring formula -- who goes on to add:
Credit reports are notoriously riddled with errors -- mistakes most people discover only when they are in the middle of a major purchase. At that point, it's often too late to get the scores fixed in time for a mortgage to close or a car to be purchased. Generally there's a 30- to 45-day lag time when fixing credit report errors, Ulzheimer said, because lenders send data to the credit bureaus in large batches, only once a month.
Comforting to know that the private Corporations that are the gate-keepers and maintainers of your financial future take the approach of, Eh, We will fix when we get to it.
I am not delusional enough to hope that we could pass laws that decouple Credit Reports from our daily, non-credit seeking lives. There should be laws preventing employers from deny someone a job based on their credit and landlords from denying housing based on their credit. But I might as well hope for a Chartered Trip to the Moon and Peace on Earth while I am at it.
The fact of 21st Century life is that we live in a world where we are largely deemed worthy and unworthy based on what we've paid, and not what we've done. The Measure of a Man is the Measure of whether he can buy a BMW with no Money Down.
If we must live under the tyranny of the anonymous report is it too much to ask, then, to take the Permanent Records out of the hands of Private Corporations and into the hands of a Public Agency with proper oversight and open reporting methods? In the wake of a Credit Crisis that helped spark a recession and was caused in large part by a gaming of the private credit reporting and credit scoring regime to approve mortgages people could not afford removing the Foxes from the Hen House seems like a modest proposal. Especially, since we are reminded by the douchebag selling Chowder and Ice Tea, our financial lives -- if not our very lives -- depend on the maintenance and upkeep of that particular hen house.