Many think a bad credit score is OK
A new survey also says 32% of Americans think homeowners should be able to strategically default on their mortgages without facing consequences.
This post comes from partner site Credit.com.
After years of economic turmoil faced by millions of Americans, a large number of consumers now have new attitudes toward the kinds of financial missteps that can land borrowers in credit trouble, including strategic defaults.
A sizable amount of Americans now consider it socially acceptable to have a low credit score or to strategically default on their outstanding mortgage balances, according to new data compiled by JZ Analytics as part of a poll for ID Analytics. In all, 36% of those polled said they believe it's acceptable to have a poor credit score these days, accounting for 77 million people across the country if the data is extrapolated out.
More interesting, however, is that many consumers have seen their attitudes toward intentionally falling behind on underwater mortgages change drastically in the past few years, the report said. A total of 32% of those polled -- 68 million people nationwide -- say homeowners should be able to strategically default on their mortgages without facing any consequences whatsoever for doing so.
Further, 13%, or 28 million Americans, say they would likely strategically default, the report said. Another 17% say they know people who have already done so.
"Our research into the consumer opinion of the economic crisis of 2008 found alarming results," said John Zogby, a senior analyst at JZ Analytics and creator of the Zogby Poll. "What jumped out is how many Americans feel it is acceptable for homeowners to walk away from a mortgage and go into foreclosure. If Americans carry on with that mindset, it will continue to cause problems as the economy undergoes a slow recovery."
Another area in which consumers have more relaxed attitudes toward certain aspects of their credit rating is whether they would exaggerate their standing to obtain new lines of credit, the report said. In all, 17% of those polled said they would do so, making up some 36 million Americans.
Finally, another 35% of respondents said they are now more afraid of being victimized by identity theft than they were five years ago, the report said.
Identity theft and account mismanagement can lead to serious damage to a borrower's credit scores, and therefore all financial documents, including credit reports, should be monitored closely as often as possible.
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We are the only country that uses credit score for everything and to use credit scores for auto insurance is absurd. The reasoning is that someone wirth bad credit files more claims and has more accidents..BS! I know many that have low scores and never file claims that were not warranted or had an accident. We are such a mislead society as most are just lambs to slaughter as we let big government and big insurance ruin our lives. It was not intended for the masses to have to go into default on their homes loans and to point blame to those with bad scores and say the economy will never grow, you needs and education in economics. Real paper money and Gold makes or breaks the economy not scores.
And for those out there with perfect scores ,when you die the only thing you will have is sadness. You are judged on what you did in this life and how you contributed, not sitting around and wondering how your pissy credit score is..
Why should we behave any differently than: lawyers, police, wall st. bankers, mortgage companies, lenders of all kinds, business people, brokers of all types, politicians, clergy of all denominations, colleges, pop stars, actors...
Getting the picture? We have all been offered a new, low set of standards; all part of the race-to-the-bottom.
What does your credit score matter anyway if you pay cash for everything?
If the banks would work with people who didn't want to default on their mortgages in a reasonable manner we would have a different attitude.
There were/are no common sense options available to homeowners. The smart money learned pretty quick strategic default was best option. I can think of multiple scenerios that would have kept people in their homes and the banks satisfied;
1. Allow homeowners to repurchase homes at current value
2. Reduce mortgage to current value but when sold bank is eligible to receive price gain
3. Credit previous interest payments to principle balance
4. No cost refi to lowest interest rates available
Just because someone uses a credit card doesn't mean that they are not paying off their balance, there are people that actually do that and it makes your score high. Yes, cash is the best but you better have a lot of it to pay for everything in cash.
It sounds like Romney was right when he talked about americans feeling like they are intitled to get everything for free. You are intitled to nothing more than servival. If you want more than that, get off the couch and quit selling your food stamps to support yourself and get a job. If you cant do that then let Darwinism reign.
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