Until the other day, nothing surprised me when it came to the credit industry. Well, that all changed after reading an article in the Wall Street Journal about the Bank of America's newest credit card.
The article reads:
"The new Bank of America program is open to people who lack both a Social Security number and a credit history, as long as they have held a checking account with the bank for three months without an overdraft. Most adults in the U.S. who don't have a Social Security number are undocumented immigrants."
This has many thing wrong with it on so many levels. For the record, I am for giving anyone a chance in this country to become an American citizen and lay claim to the American dream. Further, I support a program that deals with the illegal immigrants in this country fairly providing them with the opportunity to become American citizens.
I had so many titles for this article.
"The New Payday Loan from Bank of America."
"The Crime Rewards Card from Bank of America."
If they are giving out credit when no credit report or social security card exists, then there is something in it for them. Just like every other player in the credit industry, they are depending upon human nature to take over. Human nature is to make mistakes when it comes to dealing with your money. As a result, the credit industry makes you pay dearly for it. Just try being one day late, and you will pay the maximum interest rate penalty forever.
It is difficult enough for English speaking Americans to understand the credit system. As far as illegal immigrants, I would imagine it is even tougher to understand. This is a system that is setting up good people to fail. As a result, the bank makes the money on higher rates and fees.
Is this really about helping an "underserved community" or about making money by in a sense issuing payday loans?
I was curious as to the terms and conditions on the account. In an attempt to find out, I called Bank of America. The first lady argued that they would never have a program that gave credit to someone without a social security card. The next lady said she knew what I was talking about and would send me to someone for more details. The next lady said the same and then cut me off.
I finally called a branch in Los Angelas where they are starting the pilot program. In her own words she said, "We don't have terms and conditions for this program. We set them up when we set the account up for each person." She couldn't tell me how high the rates would be or the fees and penalties.
However, she said that the bank was "trying to serve the underserved community." Bless her heart, she really believes that to be true. Of course, they have the perfect person there to set up these accounts. She said she understands the market because she is married to an immigrant.
This is just another aggressive scheme put together by a Bank that is more about excessive interest rates and penalties and the almighty bottom dollar.
Oh and did I mention..... They want to help out those who are breaking the law. The irony is that the common day criminal couldn't walk into the Bank of America and get a credit card. The common day criminal has a social security card that reports a crime. As a result of a crime reported on a credit file, their credit is shot with no options to getting a credit card.
However, if you are an illegal allien living in Las Angelas, it doesn't matter.
Friday, February 16, 2007
Thursday, February 01, 2007
Letter to Texas House Representative Charlie Geren
Dear Representative Geren,
I understand that you were denied an insurance policy due to the inaccuracy of your credit score. Due to a low credit score, the insurance company that you applied felt you were too much of a risk and as a result would not accept your application.
That actually surprises me. I thought that most politicians had a way around the system. Well, since you are experiencing the same problems of your voters and getting a taste of how the world works outside the capital, let’s take this opportunity to let this unfortunate mishap turn into a positive for all of us.
You might not be aware of some of the problems in the system of credit and credit scoring. As a State Representative you potentially yield a lot of power. Your colleagues in Washington have passed the buck to the states to pass the tough laws against the credit industry. This way they can still sit in the even more unrealistic world of career politician land and not have to do anything that disrupts their relationships with the credit industry who like to pay lots of money in campaign contributions. It is quite the cozy relationship.
Being a Republican you especially have a great opportunity to make a difference. Unfortunately, at least in Congress, it is the Republicans that love the political contributions from the credit industry. Unfortunately, they have lost power and now the Democrats (who have no love for the industry because the industry shows them no love) are actually starting to do something on a Federal level.
While that taste of reality is still fresh, take this opportunity to start a movement on the Texas state level that shuts down the anti-consumer practices of the credit industry. How about some new legislation that helps us out with unethical debt collectors? How about some help with usury laws on interest rates? How about some action on credit scoring?
You see in the real world consumers are struggling to get out of the debtors jail that politicians have helped build through the years.
You had mentioned that your score was low only because of inquiries of 4 major credit transactions. There is a low probability that those inquiries that you had during that time period would have done enough damage to lower your credit score to the levels were people are denied based on credit scores. Thus, you probably have many mistakes on your credit report that are bringing that score down. Of course, with better legislation, that also might not have ever happened.
Sincerely,
Bob Brooks
I understand that you were denied an insurance policy due to the inaccuracy of your credit score. Due to a low credit score, the insurance company that you applied felt you were too much of a risk and as a result would not accept your application.
That actually surprises me. I thought that most politicians had a way around the system. Well, since you are experiencing the same problems of your voters and getting a taste of how the world works outside the capital, let’s take this opportunity to let this unfortunate mishap turn into a positive for all of us.
You might not be aware of some of the problems in the system of credit and credit scoring. As a State Representative you potentially yield a lot of power. Your colleagues in Washington have passed the buck to the states to pass the tough laws against the credit industry. This way they can still sit in the even more unrealistic world of career politician land and not have to do anything that disrupts their relationships with the credit industry who like to pay lots of money in campaign contributions. It is quite the cozy relationship.
Being a Republican you especially have a great opportunity to make a difference. Unfortunately, at least in Congress, it is the Republicans that love the political contributions from the credit industry. Unfortunately, they have lost power and now the Democrats (who have no love for the industry because the industry shows them no love) are actually starting to do something on a Federal level.
While that taste of reality is still fresh, take this opportunity to start a movement on the Texas state level that shuts down the anti-consumer practices of the credit industry. How about some new legislation that helps us out with unethical debt collectors? How about some help with usury laws on interest rates? How about some action on credit scoring?
You see in the real world consumers are struggling to get out of the debtors jail that politicians have helped build through the years.
You had mentioned that your score was low only because of inquiries of 4 major credit transactions. There is a low probability that those inquiries that you had during that time period would have done enough damage to lower your credit score to the levels were people are denied based on credit scores. Thus, you probably have many mistakes on your credit report that are bringing that score down. Of course, with better legislation, that also might not have ever happened.
Sincerely,
Bob Brooks
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