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There's a New Score In Town

Posted by NextGEN Real Estate Corp. on March 25, 2011 at 10:57am
Big news in the credit score arena. Credit reports are getting an important new addition-apartment rental scores. This is great news for renters or people who wish to establish a positive credit history and good credit score. Experian is the first of the big three credit bureaus to include this data, adding millions of apartment rental accounts to their credit file database in December 2010.
For decades, the only time apartment rental accounts would show up on credit reports was if you were in collections or had been evicted. Experian acquired RentBureau, the company furnishing the apartment rental data, exhibiting its willingness to step outside of the financial services comfort zone. This is significant as anytime something new is added to a credit report, the provider of the data is exposed to potential liability and Fair Credit Reporting Act obligations.
According to Brannan Johnson, VP and Managing Director of Experian RentBureau, this was no easy task, “We did it as soon as we could. It took a lot of time and effort to load the data to the Experian database and go through legal and compliance reviews. Our goal for quite some time has been to expand the breadth of the Experian credit file. For many consumers their rent represents their largest monthly obligation. The rental data provides the first account on many consumers’ Experian files.”
This creates a credit file for many consumers. One third of the consumers in the former RentBureau database had no Experian credit file, or at best they had a thin credit file. Like it or not, people are much better off having a credit report than not having a credit report. A credit report is essential for doing business with mainstream lenders and having access to more credit at better terms.
The apartment accounts will be updated monthly by Experian, just like mortgage, auto and revolving credit accounts. If a consumer wants to dispute the accuracy of one of the rental accounts, the same protocol for disputing accounts will apply. Experian won’t add negative rental history until 2012.
FICO says they won’t include the rental accounts in their scores until they’ve had the opportunity to fully evaluate the predictive nature of the information.
So, here’s the round-up. An improvement in credit scores for the majority of renters, access to better credit at better terms and an important first step in building a strong credit score
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Positive Sign of Mortgage Lending? Sounds like things might be loosening up a bit?

Posted by John Susan Karen on December 16, 2009 at 10:11am
If you are in the process of buying a house, keep checking on the progress, monitor your credit scores because the lenders have once again tightened their standards. Improve your credit profile by doing the following:• Review your credit reports for errors. Visit AnnualCreditReport.com and order your credit reports from the three main credit-reporting bureaus: Experian, TransUnion and Equifax. You’re entitled to a free credit report once a year if you go through this website. Review your credit reports, and look for inaccurate information. Dispute errors through their published process. • Pay off credit cards and other debts. Paying off balances will increase the amount of unused credit you have available, which will help your score. Many say even if you’ve decided never to use credit cards again, don’t close your accounts. You reduce the amount of your available credit, which could hurt your credit utilization ratio.• Avoid opening any new accounts. New accounts you open are likely to drop your credit score. When you order your free credit reports from AnnualCreditReport.com, your credit scores aren’t included; you’ll have to pay a fee to get them. You can buy your FICO score and credit report from TransUnion and Equifax at www.myfico.com for $15.95 each.Many banks have posted profits possibly brought in by the sales of short sales and REO properties.In a meeting at the white House Monday Citigroup and wells Fargo agreed to support the struggling economy by lending. Possibly the recently released “Home Affordable Foreclosure Alternatives Program” or “HAFA”guidelines for "streamlining" short sales will help a few consumers in distress.That is good news for a home buyer. Sounds like things might be loosening up a bit?But Fannie Mae guidelines don't seem to be so consistent with this focus. Fannie Mae sets the standards for mortgage loans. Starting this week, mortgage finance giant Fannie Mae will require borrowers with a 20 percent downpayment to have a credit score of at least 620. Previously, the cutoff was 580. This action could stymie frustrated buyers who look to take advantage of the tax credit incentives that were recently extended.Makes you wonder if everyone is listening and aware of what is going on in the next room. Posted by Susan Phelps from StopForeclosureShortSaleTeam.
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