>I understand the importance of protecting
>credit by paying credit card
>bills and student loan payments
>on time. Oprah did a
>financial show which revealed inadvertantly(I
>just noticed it from watching
>and listening all of the
>stories)that Blacks might get lower
>credit limits (these were all
>college students, so their incomes
>were based on student loans,
>so were all probably very
>similar in amount). The white
>students had like $20,000 and
>$30,000 in credit card debt!
>The Black students had like,
>$5,000 and $8,000 in
>credit card debt, and were
>saying how their credit was
>in ruins. They could not
>qualify for apartments, and had
>to live with their parents
>when they moved out of
>the dorm at college. One
>of the white girls had
>like $25, 000 in credit
>card debt, or something ridiculous,
>and her mother complained to
>Oprah that the girl turned
>right around and got ANOTHER
>credit card with like a
>$15,000 limit on it, and
>bought a brand new car
>with the credit after she
>graduated. How can this be?
>And what recourse do Blacks
>have against such financial injustices?

I know this sounds like a terrible injustice, but until you know more about the situation, you really can't tell, in fact, it may not be a racial injustice at all.

Two things I want you to think about before I get into this:

#1. When I was in college, I noticed that there seemed to be more poor/lower income Black kids, then poor/lower income White kids (% wise)...what does this mean? Well that poor White Kids are not as likely to go to college, as poor Black kids are.

#2. My friends who were poor/lower income White kids, seemed to avoid credit cards alltogether, or avoid using them if they did get them.

Those are just two things I want you to think about..


Now, when you look at the above situation, you think that the White Girl is getting over because she's White, after all, she had 3x the amount of credit card debt, that the Black kids had. BUT, you really can't determine if it's unfair or not, until you know more about her situation.

#1. Credit card companies don't know what race you are; American Express & Citibank don't know what color I am, they've never seen me and I've never told them.

#2. you can't judge fairness between two people's ability to get credit based on their credit card balances. The reason for this, is that the % of your total available credit, on credit lines/credit cards, is what determines your credit rating, moreso then the actual amount.

Think about it, if you have 4 credit cards and the average credit line is $25,000, so what if I have a $40,000 total balance? I'm only using 40% of my total available credit (The ideal is 50% with regards to your credit) I have plenty go, and if I make my payments on time, I don't appear to be having problems maintaining my credit.

BUT, if you have 4 credit cards,with an average credit line of $1,500 and your total balance is $8,000, your over the limit by $2k, you obviously can't manage your credit (even if you're making your payments ontime) and you're a bad customer.

See the difference?

I suspect that what the case was for the white girl in question.

Other factors:

-Parents often put their kids on their credit cards and this is more likely to happen to White kids then Black ones. Typically, the credit card company will report the activity on that card to a credit reporting agency as if it was your card. The net effect is that your credit is positively impacted.

If Mom has a Platinum card she rarely uses and she puts you on it, in case of an emergency and you run up your other card to the limit, you'll still look because Mom always makes her payments has a 80k limit...so to the credit scoring computer, your credit looks good because the $25,000 you racked up isn't even half of your total available credit.


-White kids put their parents income (which is usually higher) on their credit card apps; they also probably more likely to lie about their income (knowing it gives them a higher limit), work the system to get higher limits (Charge things you don't need and then pay it off), etc.

-The White kids are more likely to come from homes where their parents had credit cards and know how to work the system, SO, the know that even if they carry a Balance, that if they keep paying the minimum, they'll maintain their credit and at some point they company will reward them with a higher balance.

-Payment History: I know a lot of White kids who kept up their payments in college, White a lot of Black kids gave up, because they were simply paying the finance charges and it wasn't freeing up more available credit for them to use. You can't call it an injustice unless you know the payment history. I've racked up some $ on my cards lately, and I'm sure I still have better credit then a lot of people with less debt, simple because I don't miss payments, nor do I use more then 50% of of the credit line of any one card.

S0, when you pay your payments on time for the 4 years you're in college, you're going to be rewarded with higher limits and a better credit rating....this seems to happen to White Students more often then Black ones.

When I was in college, a lot of the Black kids lost their credit cards in a year or two, while a lot of the White kids were rejoicing about their new 10k credit limit just in time for them to buy suits for interviews during our Sr. year.

ALSO, when the White kid gets in trouble, it's more likely that they'll be able to ask Moms to spot em' $100 to make their payments.

Student Loans: Who is more likely to owe more on their student Loans? White Kids or Black kids...unlike revolving debt like credit cards, the amount of debt here does matter.

Anyway, add that all up and it isn't racial injustice, it's merely the product of one's financial situation.

Look at it another way, let's say that you and I have the same income, the same financial obligations, identical amounts of debt and identical credit ratings....

In five years, who do you think is more likely to have saved more, accumulated more wealth and built up their credit more?

Would that result be because of race or appearence?

I doubt it.








Peace,








M2