What is credit? Why does it exist? How do we decide who gets it? In episode 9 of the Wall & Broadcast we explore the evolution of the concept of credit and how we determine who is creditworthy. Many of us take advantage of credit every day without thinking twice – whether through the use of our American Express, Visa or CITGO cards, our mortgage or home equity loans. But what happens when, through no fault of our own, we do not have access to these financial tools?
There are millions of Americans either with no credit history or very little credit history who are unable to gain access to reasonably priced credit. Often called “No File” or “Thin File” applicants, these borrowers are relegated to the most expensive products with no recourse. And things get even more complicated for people with a long credit history who have been labeled subprime due to life circumstances that might be unavoidable. What is the industry doing to extend the credit lifeline to families on the edge? Is there any hope? Or are we destined to continue lumping everyone in either prime or sub-prime categories, with the ensuing financial implications going un-remedied?