Little credit history? Lenders are taking a new look at you

Source: Ann Carrns, N.Y.Times (Paid Registration)

About 45 million Americans lack traditional credit files, and the federal government is looking into whether alternative credit scoring models could bring more of these consumers into the financial mainstream.

The Consumer Financial Protection Bureau opened an inquiry this month into the pros and cons of using “alternative” data, like rent and cellphone payments, to formulate credit scores. It is seeking feedback from the public and the credit industry.

The creator of the widely used FICO credit score recently introduced FICO Score XD, which uses data like cellphone and cable payments along with public data like property records.  TransUnion, too, began offering a scoring model in 2015 that incorporates alternative data.

Read Full Article: Little credit history? Lenders are taking a new look at you

 
 

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