And so, home equity lending surged as well.
Then it dawned on some genius, ??Hey, wait a minute. Screw the credit score. I mean if a borrower has a bad credit score, but they have equity in their home, why not lend to them anyway? If they default, their home equity is there to protect our loan. But wait, it gets even better. On top of that we can actually make more lending to people with bad credit scores than to those with good ones. Because we can charge them higher loan fees and higher interest rates. And ?? wait til you hear this, this the best part ?? they can't even blame us for charging them more. We just point to their credit score and say, 'hey deadbeat, it's not our fault you're a higher risk.' ?
And so it came to pass, the sub-prime home loan and sub-prime home equity loans became the bread and butter of America's largest home loan companies, like Countrywide.
By 2000 the credit score had become a double-edged sword, both edges on dangling over the head of consumers. If you always paid The Man on time and in full, you got a few points shaved off what the lender charged. If you were late making payments, or worse, they'd still lend you money, but at much higher rates. The credit score became a coin flip ?? heads they win, tails you lose.
You can pretty much chart the stratospheric rise in total US household debt, to the day credit scoring began:
It should have been predicted and, who knows, maybe some did and felt it would be just dandy. The credit score has become an iron leash lenders now hold attached to every American over 18 ?? a leash so pervasive, so strong, so threatening to Americans live today that Mafia loan sharks must view it with burning envy. ( ??Hey, Tony, dese Shylocks don't have to a lay a finger on dem schmucks. Dey just yank this credit score thing and, batabang, batabing, da suckers cough it up the vig every month right on time.)
And so today, you know, (oh yes, you know...) one wrong move, just one wrong move, and your credit score gets it. So, better be a good. Better not shout. Better not pout. Because CapitalOne is coming, and they know exactly ??whats in your wallet. ?
You're behavior is controlled by forces you can't see. Like it or not, you are ??hooked up. ? And they hold the remote.
Then it dawned on some genius, ??Hey, wait a minute. Screw the credit score. I mean if a borrower has a bad credit score, but they have equity in their home, why not lend to them anyway? If they default, their home equity is there to protect our loan. But wait, it gets even better. On top of that we can actually make more lending to people with bad credit scores than to those with good ones. Because we can charge them higher loan fees and higher interest rates. And ?? wait til you hear this, this the best part ?? they can't even blame us for charging them more. We just point to their credit score and say, 'hey deadbeat, it's not our fault you're a higher risk.' ?
And so it came to pass, the sub-prime home loan and sub-prime home equity loans became the bread and butter of America's largest home loan companies, like Countrywide.
By 2000 the credit score had become a double-edged sword, both edges on dangling over the head of consumers. If you always paid The Man on time and in full, you got a few points shaved off what the lender charged. If you were late making payments, or worse, they'd still lend you money, but at much higher rates. The credit score became a coin flip ?? heads they win, tails you lose.
You can pretty much chart the stratospheric rise in total US household debt, to the day credit scoring began:
It should have been predicted and, who knows, maybe some did and felt it would be just dandy. The credit score has become an iron leash lenders now hold attached to every American over 18 ?? a leash so pervasive, so strong, so threatening to Americans live today that Mafia loan sharks must view it with burning envy. ( ??Hey, Tony, dese Shylocks don't have to a lay a finger on dem schmucks. Dey just yank this credit score thing and, batabang, batabing, da suckers cough it up the vig every month right on time.)
And so today, you know, (oh yes, you know...) one wrong move, just one wrong move, and your credit score gets it. So, better be a good. Better not shout. Better not pout. Because CapitalOne is coming, and they know exactly ??whats in your wallet. ?
You're behavior is controlled by forces you can't see. Like it or not, you are ??hooked up. ? And they hold the remote.
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