Articles Tagged with ''Credit score''

VantageScore: How the FHFA can open the door to alternative credit score models

A transition from the FICO model
Although FHFA Director Mel Watt recently threw cold water on the idea, at some point in the future, the mortgage industry will move to using a credit scoring model other than one built by FICO prior to the recession. A push towards embracing alternative credit scoring models has gained steam in recent years, and as the discussion starts to grow, VantageScore Solutions plans to be right at the forefront of it.
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CoreLogic: Mortgage lending just got riskier

Market shifts to investor loans
During the second quarter this year, the risk in mortgage lending inched up as the market shifted toward an increased share of investor loans. And while mortgage risk remains at the 2001 to 2003 benchmark level, it has been increasing since 2016, and if the trend continues, could soon surpass these levels.
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Bring visibility to credit invisibles through alternative financial data

A clear opportunity for lenders to capitalize on
[Expert commentary] In today’s environment, loans are not as accessible to a growing number of Americans given a lack of sufficient, traditional credit history. This group is made up of millennials, low-income individuals, recent immigrants and mass-affluent individuals. There is a clear opportunity for lenders to capitalize on the opportunity to identify credit invisible consumers who have no credit score, but are still credit worthy.
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Huge housing trade groups push FHFA for FICO alternatives

Calls grow for Fannie and Freddie to use alternative credit scoring models
A coalition of the housing industry’s largest trade groups want Fannie Mae and Freddie Mac to look beyond FICO and begin using alternative credit scoring models. In a letter sent last week to Federal Housing Finance Agency Director Mel Watt, the groups express their disappointment in Watt, who recently threw cold water on the idea that Fannie and Freddie would begin using alternative credit scoring models at any point in the next two years.
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Hey Millennials! Have questions about how your credit scores work?

Take this quiz to see how much you understand
The exact intricacies of a credit score continue to be one of the most confusing financial concepts for Millennials. This elusive three-digital number holds the power to some of the most financially expensive purchases in a consumers life, and yet according to a recent poll from LendEDU, young American consumers only have an intermediate understanding of that all-important number. See how well you perform against the stats.
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Senate to consider bill to end “FICO monopoly” at Fannie Mae and Freddie Mac

Bipartisan push continues to allow GSEs to use alternative credit scoring models
Earlier this year, a bipartisan group reintroduced a bill in the House of Representatives that would allow Fannie Mae and Freddie Mac to consider alternative credit-scoring models beyond the FICO credit score the government-sponsored enterprises currently use. Now, a companion bill is being introduced in the Senate as well, with the backing of Senators from both parties.
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TransUnion: December rate hike prevented 1 million Americans from paying their mortgage

Significantly lower than estimated 10 million Americans with a mortgage
After the Federal Reserve raised interest rates in December, TransUnion conducted a study showing more than 10 million Americans would be unable to absorb the increase to their mortgage payment. However, further studies showed only 1 million of them struggled to meet their payments after the rate hike.
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Two major changes make getting a mortgage easier

Millions will suddenly qualify for home loan this month
Two changes coming this month will allow millions of buyers to enter the mortgage market as FICO scores improve. About 6% of Americans will see an improvement to their FICO scores due to the first change, and the second will allow borrowers to take on more debt in addition to their mortgage.
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Do you use alternative data? This is how it opens door for millions of borrowers

Are you current with technology or still using traditional data?
Most mortgage industry leaders have made significant changes in their processes to keep current in the past few years and credit bureaus are no exception. Lenders are seeking creative methods to evaluate potential borrowers who lack credit history, and in some cases, identify consumers who will likely soon apply for credit and reach out to them directly. Here's how credit bureaus are meeting this challenge.
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