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Anon tries to understand credit scores
(sh.itjust.works)
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this post was submitted on 27 Dec 2025
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The exact same as the Chinese "social credit" system that people whine about, except this one is capitalism based, so it's ok.
How do you think "social credit" would be handled if the US were a socialist/communist country?
Is that relevant to anything? Credit score bad. Next.
Nah, it's good for me to know the risk before I lend to someone. Only bad borrowers are against their reputation re repayment history not being public.
Without credit scores, nepotism and bigotry are what decides who gets loans, since lenders will have nothing but 'vibes' to go off of. No thanks.
Huh?
In my country there's debt registries (that you can only be put into when you're late enough on a payment) and lenders will usually ask you for proof of income and list of obligations, or account statements for the last 6 months, to determine if you're capable of paying back.
The disadvantage is, they'll see your account statements. The advantage is, you don't have to have a credit card, or any sort of debt, to build credit. You don't need credit history. If your income is high enough and your expenses are noticeably lower than your income, and you don't have an outstanding debt registry entry, you're eligible for a loan.
Our mortgage delinquency rates are lower than in the US. And home ownership rates are pretty high so it seems people are getting mortgages no problem
So you have a system that's only different than the US's in the minutia—fundamentally, it's still lenders using information from the to-be borrower's past to try and determine how risky it is to lend to them.
Which is what the person I was replying to is saying is a bad thing for lenders to have access to. Your country's debt registries are functionally equivalent to negative marks on a US credit report, so I think you're actually more on my 'side' here than the person I replied to.
This doesn't protect lenders from people who are plenty capable of handling a debt with the income they have, but don't, because they're irresponsible with that income. But that may be more of an issue in the US than in your country overall, culturally.
What's your rate, if you don't want to reveal your country of residence directly? I'm curious of the gap, and also want to make sure you're not using figures from around the 2008 scandal (primarily caused by a bunch of lenders giving mortgages to people who shouldn't have qualified); It's 1.78% in the US presently.
Define "pretty high", so I can get a better idea; it's 65% in the US presently, for reference.
If you've never fallen behind, or it's been over 5 years since you paid off your delinquent debts, there's no record. There's no need to play around for a good credit score.
The country is Estonia. Mortgage delinquency rates are 0.17% over 60 days late as of last year.
Home ownership rate is about 80% and a lot of those are mortgaged.
There are good reasons to avoid delinquency. The bailiffs can get your bank accounts even in other EU countries arrested if you keep refusing to pay. Also the debt registry system is fairly effective. You won't be getting any major credit for at least 5 years once you're in on it.
Banks are also willing to work with people on alternative payment schedules if they get in trouble. I'd wager that saves everyone involved some money and time too.
It's kind of similar in the US, negative things are gone 7 years later, regardless of whether they were resolved.
I'm seeing about 20% of homeowners having mortgages in Estonia, I wouldn't call 1 in 5 a lot. It's more like 60% in the US.
Also reading up on this, it looks like some post Soviet-era policies gave a lot of people the ability to buy their homes outright for a fraction of the cost in the 90s, so it seems a lot of what you're saying is the result of inertia from that. From what I read, it also seems Estonians are more likely than Americans to 'live within their means' as well, being much more averse in general to going into debt. That's definitely going to contribute to that low delinquency rate.
This all sounds pretty similar to how it is in the US.
This is also true in the US.
Overall, from what I'm seeing, I don't think any of the significant differences you've mentioned between Estonia and the US can be chalked up to how our credit score system works versus how it is there—you honestly describe a very similar system, and there are much more obvious reasons for the differences that I saw in the bit of research I did.
Who are you lending to?