Back-End Ratio

Finance a la shmoop what is the Fair Credit Reporting Act? alright so think

old the Englande it's 1604 and your family is still working the barley [Family carrying barley]

fields because great-great-grandfather smeltwagon wasn't very good at rolling

the bones he lost a lot of money so yeah great-great grandpappy ended up with

gambling losses getting him into massive debt with over 97 farthings worth of [farthings drop into a bag]

debt accumulated after 20 years of bad gambling bones so in England well they

would either torture you until you found a way to pay off your debts either

legally or not or they would just throw you your family and your progeny into

essentially a work camp for generations and in fact it was this unfairness that

led to the notion of no taxation without representation in our own Constitution [US constitution appears]

so as the world turned the notion of credit fairness actually became a thing

and eventually the Fair Credit Reporting Act was established in 1970 and of

course it gave rise to the store Credit Reporting Act first adopted by Sears

where America well used to shop yeah I remember Sears catalog that was

called the Amazon back in the day all right with enormous abuse of the

credit system the haves or if the educated or the wealthy were able to get

away with nearly everything just shy of murder while the uneducated well they [Arrow points to uneducated people]

suffered the key driver in credit or an individual's access to borrowing money

revolves around the manner or form in which their credit scores were reported

and calculated in all that stuff so if you're educated you kind of know how to [Students playing video games]

game the system right and in fact with no structure behind credit reporting the

system was simply not trustworthy and it had to be codified or made into cookie

cutter nuggets each of which treated those seeking a credit score equally and

fairly individuals were able to petition to correct bad information that had

somehow leaked into their system like inaccurate information like it would do

that and sit there and haunt you for decades they were also allowed to

actually access their score and amazingly in the past people did not [Credit score rises]

necessarily have the right to view their own credit score how

weird and finally bad credit stopped being a cattle brand that lived with an

individual for their entire life new amendments allowed people to remove bad

credit annotations by paying off their debts along with the penalty and then

having good credit for three four five years after which time the negative

frowny faces were removed from their credit ratings sheets

so yeah credit reporting was finally fair and people were finally able to you [Cattle brand credit score appears]

know go in for cattle brand removal that's gotta hurt...