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The History of Credit and the Bureau
Our nation is in chaos and the root of it all stems from good graces of man. Credit is deeply rooted into our history and it stems from a person's or merchant’s product or service priced too high for the average consumer; or when payment for the item(s) was not convenient at the current time. This was the birth of the consumer credit program.
Let's look at a typical California House priced at $395,000. The builder,
in order to make a profit, needs to sell many of these homes at this price.
How many of us have $395,000 to plop down in one lump sum?
If the builder only sold homes to people who could pay the lump sum, they
would not sell many homes and the price would skyrocket to $3,395,000
due to the need for the builder to earn an equitable profit. On the other
hand the builder would not make any profit if the homes were sold at $4000
or even $40,000.
The homes must be sold at a price that is consistent with perceived value
and quality, but still needs to make it available to the average consumer.
This is the reason the mortgage business is so huge.
Let's look at another example. This trend is deeply rooted in our history.
Have you ever gone to a store and realized you didn't have the money to
purchase an item? Remember asking the store clerk to put it on your account?
Actually you can still find this type of system where the merchant would
allow the consumer a period of up to 30 days to repay the debt; when payment
for the goods or services is not convenient.
This began back in the days of the general store where a patron would
come by and pick up a few items, charge them to a personal account and
the patron would agree to pay the entire account by the end of the month.
You can still find this type of environment but it's gone for the most
part replaced by the modern day credit and department store cards. This
is a system designed with the theory that you never have to pay off the
balance in full - the revolving credit or charge account. Pay off some
and spend it to the limit.
This is where people get in to trouble everyday; from late payments piling
up debt and adding stress; who needs it? As an evolution of this process,
it was natural that some type of credit reporting system would be create;
the dawn of the credit bureau.
Creditors or merchants were concerned about doing business with bad debtors;
they needed a way to report problem consumers and a way to get the information
about them before they established an account for them.
Now that the bureau had been born they began tracking information on individuals
and businesses, selling that information to subscribers (creditors) and
receiving information as well.
| Finance: Credit Tips Articles from EzineArticles.com |
| How Inquiry Removal Can Help Boost Your Credit Score Your credit score plays a crucial role in your ability to obtain a loan, whether it is a small personal loan, an auto loan, or a home or business mortgage. New credit (or your pursuit thereof) is one of the main factors that determine your score. When your credit score is being calculated, then the most recent credit on your report will account for about 10 percent of your score. |
| Credit Repair Secret Tip - Don't Depend on Any Government Bailout For Your Personal Credit! Now More Than Ever American Consumers Need To Take Control Of Their Finances and Personal Credit Scores. Sure, Wall Street Fat Cats and The Morons In Detroit Are Going To Get A Handout From Uncle Sam...But You And I Won't See Any Bailout Or Assistance, So We Have To Take Charge Of Our Own Finances Because No One Else Will! |
| Credit Repair Secret Tip - Should You Consider Hiring a Legal Professional to Fix Your Bad Credit? If credit repair and improving your credit scores is your goal...what can a legal professional do for you that the others can't? Inside this article, credit repair expert Mark Garcia shares with you the pluses and minuses of hiring a legal professional to help you with your credit repair activities. |
| Your Credit Rating Defined A credit rating basically determines the worthiness of credit of a particular individual, company, and sometimes even a country. These ratings are carefully calculated from credit history and items such as financial history, current liabilities and assets, and other various items that give a lender the ability to determine whether or not the borrower can pay back the loan. |
| How to Pay Your Credit Cards Properly - Create an Excellent Payment History How do you pay your credit card debts so that you have an excellent payment history all the time? What is this credit game that lenders play, and how do I gain a bigger benefit than my lender does from my borrowing? Use these simple tips to stay on top of your credit debts and give you the piece of mind you need. |
| Learn How Repairing Your Credit Yourself Can Raise Your Score Higher Than Ever! Repairing your credit yourself is something that anyone can do yet many people have no idea where to start. Most people don't know that you can take a mediocre 650 FICO score and push it over 700 with just a few small adjustments and corrections. |
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