It is real debt in the sense that you have an obligation to pay it back.
Sure, you don’t have a choice to take it, but that doesn’t mean it won’t effect your finances.
Of course it’s real debt, but taking it on is involuntary. It does not have the same behavioral predictive power as debt that exists because of bad financial decisions.
It might affect your ability to pay, but less so if it is not on the credit report to begin with.
Right I feel like you’re all missing my point, I probably didn’t explain my thought process well.
The premise is that:
giving out loans involves risk. To make the risk worth while, the lender needs more upside(higher rate). The more unknowns, the more risk, thus higher rates.
My logic is that if lenders had more information then they would be better positioned to evaluate risk, thus borrowing could become less expensive for people that are less risky. This is due to competition between lenders for customers. On that, based on friends getting mortgages recently, it does actually feel like there is a decent amount of competition that space specifically.
I will admit that in one of the other threads someone linked to a study that proves this wrong for medical debt specifically.
It is real debt in the sense that you have an obligation to pay it back. Sure, you don’t have a choice to take it, but that doesn’t mean it won’t effect your finances.
Of course it’s real debt, but taking it on is involuntary. It does not have the same behavioral predictive power as debt that exists because of bad financial decisions.
It might affect your ability to pay, but less so if it is not on the credit report to begin with.
Should debt to loan sharks and illegal bookies be on your credit report too?
I’m sure if they could get that info it would be on there. Seems like it would be useful for loan decisions.
Of course they would.
The question was “should they” not “would they”
Right I feel like you’re all missing my point, I probably didn’t explain my thought process well.
The premise is that: giving out loans involves risk. To make the risk worth while, the lender needs more upside(higher rate). The more unknowns, the more risk, thus higher rates. My logic is that if lenders had more information then they would be better positioned to evaluate risk, thus borrowing could become less expensive for people that are less risky. This is due to competition between lenders for customers. On that, based on friends getting mortgages recently, it does actually feel like there is a decent amount of competition that space specifically.
I will admit that in one of the other threads someone linked to a study that proves this wrong for medical debt specifically.
stop simping for capitol
Disgusting
Yikes.