Credit scores about to get personal
December 9, 2011
By: Megg Mueller
A big change to credit score reports is on the horizon. Information such as late rental payments, property tax liens, delinquent homeowners association payments and other personal financial information could show up on consumer credit score reports in the near future.
CoreLogic, a financial data collector that provides streamlined credit reports to mortgage companies and other lenders, has released a new report called CoreScore, the New York Times reports. The report, according to CoreLogic, is designed to give beleaguered lenders more information about prospective buyers than is provided by traditional credit score reports.
The new report is currently created for mortgage and home equity lenders; the Times story notes it could be developed for other kinds of credit such as credit cards. The report has raised concerns that it provides negative information not previously available to lenders, and that this will hurt consumer credit ratings. Consumer advocates are concerned that issues such as late rental or utility payments happen when times are tough or during expensive holiday periods and aren't reflective of overall creditworthiness. CoreLogic believes that the report will give both consumers and lenders a chance to see a larger picture, and that when traditional credit score items are negative, the chance for lenders to see timely payments in other sectors will benefit consumers.
CoreLogic has teamed with FICO, the agency that provides the traditional credit scoring system to the three major reporting agencies, to come up with a new credit score that will be based on the new data.
Other items that could be revealed in the new report include whether a consumer owes more on their home than it is currently worth, other real estate properties that are owned, and mortgages made by small lenders. Evictions, child support judgments, payday loans and repayment history are other types of data that could show up on the CoreScore report.