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Comment by jurassicfoxy | Hacker News Reader

But what value is credit score, really? Like, the most mundane thing credit score might affect is that you have to put a deposit down to get a fancy phone, or an internet service.

No one's buying houses, no one needs to buy a car on credit, etc. Credit score is highly overrated, no?

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>Credit score is highly overrated, no?

Credit checks and score can also affect insurance rates. A bad score can also prevent job candidates from being hired for some jobs in some industries.

>No one's buying houses,

Even in scenarios of not buying a house... e.g. Getting a new loan on a primary home via re-financing an existing mortgage or taking a 2nd mortgage requires a good credit score.

Even if one is not getting a home mortgage, renters can be denied from leasing apartments because of credit score.

No. Really no. Some employers do credit checks. It can also impact your ability to just rent an apartment. Way back in the early 2000s I had a poor credit score and it meant 1) having to put down onerous deposits for services* and 2) being declined a few times when I tried to rent an apartment.

I was able to rent an apartment, but it cost me a few non-refundable application fees first and had to take a less-desirable apartment.

A poor credit score will also cost you when it's time to buy a car. You need to buy a new car? Unless you can pay cash, borrowing money is going to cost you more because you have a bad credit score.

* One of the many ways that being broke is a self-perpetuating cycle. You have little money, so you have to cough up deposits and tie up what little money you do have trying to secure services and a place to live. Some of that money you will get back - eventually - some of it (rental deposits) there's a good chance you'll never see again or only see some of. (Obligatory mention of Vimes' Boots theory...)

a credit score locks people out of an entire tier of purchases that could reasonably be paid off over time if they weren't entirely opt-ed out by credit, it isn't just fancy phones and internet services.

i've known home-owners that can't get financed for things like air conditioners because of medical debt -- and they were home owners -- and large appliances like that constitute large purchases espescially for those on fixed incomes; this essentially means there is a group of people that own homes, , likely retired so they're working on a fixed income and could surely use the flexibility of finance options, need to finance the repairs, and can't because of unrelated medical debt.

You made a good point I hadn't thought of: it's precisely the people with bad credit scores that most often need to take out loans for those things that people with great credit scores probably don't worry about.

At least in Canada, your credit score affects your ability to get a loan, and at what interest rate that loan will be. So it greatly affects your ability to buy a car and house. Is that not also the case in the US?

I think the point is that people who have so much medical debt that they’re not even able to make payments on it are not in a position to buy a house or a car either.

And more realistically, more people than ever will never be able to afford to own a home.

Where do you live that no one is buying houses or taking out a car loan?

Many many people are never going to buy houses. I've never owned a house. Probably never will. I've never owned a new car, either, and I'm older than dirt. Some commenters had good counter examples, but those seemed to me like the main reasons to "need" a good credit score.

I get individual people being like this, but enough for someone to assume it's the norm? That's what surprised me.

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