December, 2011

New Score Offered by Core Logic, What Does it Mean for Lending?

	Tweet

In March a new credit score will be introduced by CoreLogic.This new score aims to supplement Fico scores pulled by lenders. This will be optional for banks. Since CoreLogic already provides merged reports to lenders and creditors it will be an easy product to sell. This score will compile non-traditional credit history information that may not be on regular credit bureau reports and provide a much quicker window for updating filings. The turnaround time for filings is 23 days compared to the 60 day period the bureaus usually take.

Here is a list of some of the information CoreLogics described as being a part of the new score tabulation:

Properties owned-with and without debt obligations
Mortgage obligations with companies that may not report to traditional credit reporting agencies
Property legal filings, such as notices of default
Property tax amounts and payment status
Estimated market values on all U.S. properties owned
Rental applications and evictions
Inquiries and charge-offs from pay-day and online lenders
Consumer-specific bankruptcies, liens, judgments and child support obligations

So what does this mean for lenders and consumers? While some think this will make it more difficult for consumers, others believe it will give lenders the ability to approve more loans. Those banks that chose to use the supplement will most likely see some applicants benefit from it while others are hurt. The Fico scores will still be used by lenders and the CoreLogic score and report will just be a supplement adding to the information the bureaus supply. This will give underwriters a more detailed vision into the consumers paying habits and credit management skills.

Here are some examples of what could potentially happen:

Jack has an excellent Fico score of 745, and normally this would allow him to enjoy the best rates from a lender. However, his CoreLogic report and score supplement show evictions from a landlord in the past 2 years. This added information may prompt the lender to charge a higher rate.

On the other hand Sue and John have minimal credit accounts and reduced Fico scores. They are looking to buy a home and get a mortgage approval. With the supplemental CoreLogic credit report showing prompt rental payments for the past 8 years the underwriter decides to approve a loan which otherwise would have been denied.

Since the score supplements are not readily available yet it is hard to know just how it will affect consumers and lenders. It is important to note that all credit reports and scores used by lenders are subject to the Fair Credit Reporting Act. These laws will allow us to correct, update, and modify information on any kind of bureau report and score supplement. No matter what is on any report created there is always room for us to improve it.

Feel free to call us with any credit questions.

North Shore Advisory offers credit repair and restoration services.
We've been providing credit education and credit improvement for more
than 20 years. We can help you with your business credit needs or
personal FICO scores. For bankers and realtors we can improve your clients' credit scores.
Call us at 914-524-8300

Email: info@northshoreadvisory.com

Call Today for a Free Credit Education Seminar!

914-524-8300

www.northshoreadvisory.com

Testimonials

Newsletters

Blog

Order Tracy's new book

Credit Score Power

for everything you need to know about your credit and score!

November 2011,

Tracy Becker in the New York Times article, When a Co-Borrower Has Poor Credit

"...one way to raise a FICO score by 30 to 40 points in a few months is to be added as an authorized user to a well-established person's credit card, even if you don't use the card. Your score can rise, too, if you pay down credit-card balances so they are at least 10 percent of the maximum credit limit."

North Shore Advisory is now active in social media!

Do You Have Any Credit Questions?

Ask Tracy!

ask@northshoreadvisory.com

Tracy Becker

President

155 White Plains Road

Suite 200

Tarrytown, NY 10591

(914) 524-8300

(914) 524-5014

914-524-8300

Call Now for a FREE Credit Education Seminar

Send Newsletter as Email

North Shore Advisory | 155 White Plains Road Suite 203 | Tarrytown | NY | 10591