You have faith in our banking system? Think again...

[HoldingPattern]

Westpac just gave me and my similarly unemployed 18 year old friend a platinum card with a $10k line of credit. Yes my friend has significant assets, but for two unemployed teenagers that are new customers they WAIVED INCOME VERIFICATION!!!!

What the frick?

 

[medhead]

have you picked up the cards yet? I'm sure they'll ask for proof of income when you do

 

[HoldingPattern]

When the primary card holder picked up the cards they waived the income requirement.

 

[HoldingPattern]

*waived the income verification

 

[vilemerchant]

Time to hit the pokies!

 

[albatross710]

When the primary card holder picked up the cards they waived the income requirement.

The question would be who is the primary card holder?

In my case, I have a Westpac home loan and they are well ahead on security over my borrowings. Regardless of my income they are happy to provide cards and increased limits as their risk is well covered.

Westpac changed their credit card terms and conditions a few years ago allowing them to offset a credit card debt against your other assets that they hold. Effectively they are able to lend money at credit card rates knowing they have full security!

Alby

 

[ric_melb]

What is unclear from OP's original and subsequent postings is whether he and the friend are primary cardholders or supplementary cardholders.
If supplementary cardholders then the credit analysis would be based on the primary cardholder.
If in fact they are primary cardholders perhaps he would care to give me personal details so that I can make sure Westpac cancel the cards.

 

[medhead]

When the primary card holder picked up the cards they waived the income requirement.

Oh, who is the primary card holder in relation to the 2 18 year old unemployed people?

 

[albatross710]

Oh, who is the primary card holder in relation to the 2 18 year old unemployed people?

the chance for a bank to screw up a young person's credit rating with a card they can't afford. - some things never change.

 

[JohnK]

My guess would be that they are supplementary card holders.

have you picked up the cards yet? I'm sure they'll ask for proof of income when you do

In my experience Westpac asks for proof of income when you go to the branch to collect the cards. Cannot see how an unemployed 18 year old would get a credit card from anyone let alone Westpac. I could be mistaken and I am sure someone will come out and say that it has happened before....

 

[medhead]

the chance for a bank to screw up a young person's credit rating with a card they can't afford. - some things never change.

hey? no sure how this is related to my ?

 

[Diesellife]

The card is approved based on asset based assessment and no further income detail is required. But I haven't seen the application, so I can't comment further.

Normally, large amount of assets more or less will generate income which could cover the minimum payment anyway.

Moreover, asset based customers are considered (By statistic) to be have a lower risk compare to ordinary borrower with no asset (Even tho both lending are considered as un-secure)

I also guess your friend has no other credit card?! A 10k total un-secure debt is really not that much if you have 5-10 times asset backed?!

 

[albatross710]

hey? no sure how this is related to my ?

I was referring to banks how "in relation to the 2 18 year old unemployed people" they expect them to be competent money managers at that age. The ones that fail end up with bad credit ratings for life. I have friends since school who are still financially crippled by their nieve decisions when they were 17.

 

[serfty]

Strange ... even those who go Bankrupt basically have their 'records' scrubbed after seven years ...

 

[albatross710]

Strange ... even those who go Bankrupt basically have their 'records' scrubbed after seven years ...

Agree that their records are scrubbed but the poor financial habits remain. These are guys who bought cars with 'pre-paid' insurance and rego for three years all financed on hire purchase. By the time they had cleared those debts and their car was worth bugger all they were along way behind. Sadly they have continued to make some of the same financial decisons. I feel that I want to see youth protected from these deals until they are better informed.

Last time I saw some reserch on young people many had sky high credit card debts and carry over balances.

 

[JohnK]

I have friends since school who are still financially crippled by their nieve decisions when they were 17.

I know someone who has had a horrible credit rating since he left school early and I can't understand how he has managed to get any credit since then. He has never owned a credit card but managed to get some furniture and a car in his adult life until he split up with his girlfriend and could not repay, would not repay, the outstanding amount. I forgot the actual amount but the collectors finally caught up with him a few years ago and wanted some astronomical amount. He has managed to dodge them again but he is basically ruined for life.

He will never be able to have a credit card, a fixed line phone (owes Telstra a lot of money and has been using prepaid mobiles for many years), or get a license or register a car until recently (huge debt for unpaid traffic infridgements but paying it off at $20 a week/month now), get any goods or services from various business, borrow money for a decent car or buy a house even. His current girlfriend is pregnant with their 3rd child and he also has 2 adult children.

Strange ... even those who go Bankrupt basically have their 'records' scrubbed after seven years ...

Only if you have declared yourself bankrupt and do not carry outstanding debts with you....

 

[serfty]

... Only if you have declared yourself bankrupt and do not carry outstanding debts with you....

Once you have declared yourself bankrupt, basically all debts are wiped! After 7 years, the record of the bankruptcy is also wiped!

 

[Diesellife]

I was referring to banks how "in relation to the 2 18 year old unemployed people" they expect them to be competent money managers at that age. The ones that fail end up with bad credit ratings for life. I have friends since school who are still financially crippled by their nieve decisions when they were 17.

Well first of all, it is not the bank's job to teach a person how to manage their finances. And quite frankly, being older does not necessary have the advantage or better knowledge of managing finance.

So perhaps if someone is financially crippled when they are 17 (Which is below the legal age of 18), the only people to blame are their parents or guardians. Furthermore, if the person is still financially crippled after 10 years, surely there is something wrong with his way of managing his finance and merely taking consequence for his own action.

 

[medhead]

I was referring to banks how "in relation to the 2 18 year old unemployed people" they expect them to be competent money managers at that age. The ones that fail end up with bad credit ratings for life. I have friends since school who are still financially crippled by their nieve decisions when they were 17.

Well, big probably here. I asked What is the relationship between the primary card holder and the 2 18 year old unemployed people. You've taken half of my question and gone off on some tangent.

As others have alluded I find the whole OP dodgy, especially with the later reference to a primary cardholder. If what I suspect has happened, did happen then it is this third party primary card holder who is going to be screwed not the 18 year old unemployed secondary cardholders.

 

[Diesellife]

Well, big probably here. I asked What is the relationship between the primary card holder and the 2 18 year old unemployed people. You taken half of my question and gone off on some tangent.

As others have alluded I fine the whole OP dodgy, exspecially with the later reference to a primary cardholder. If what I suspect has happened, did happen then it is this third party primary card holder who is going to be screwed not the 18 year old unemployed secondary cardholders.

I agree with you totally Medhead... Unless they are referring the supplementary cards outside of Australia... E.g. United States / Hong Kong...which uses the scoring credit system and supplementary card holder will update its own seperate report monthly once the card is established.