VVance
1670 Posts |
 Posted - 05/05/2008 : 05:47:42 AM
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This is the basis of qualifiying for almost all loans and has been for 10+ years. This scoring system has virtually eliminated any bad loans and foreclosures. How did our industry even survive prior to this scoring system? (Sarcasm ON)
AS THE DIRECTOR of finance at a Spring Hill, Fla.-based Chrysler dealership, Marvin Hedrick has had his fair share of skeptical (and unhappy) clients, especially when he has to turn someone down for an auto loan or break the bad news that they'll have to pay a much higher interest rate than they expected.
It's an issue Hedrick deals with all too often: Car buyers walk into his office with an inflated sense of their creditworthiness and he has to burst their bubble. Recently, a client came in armed with a copy of a credit report that said her score was 640. When Hedrick pulled the report, however, her score was 600. That 40-point reduction in her score meant the difference between qualifying as a prime borrower and paying 7.85% interest and being considered subprime and getting a loan at 11.64%.
http://www.smartmoney.com/consumer/index.cfm?story=20080501-credit-scores&afl=myyahoo |
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