Credit

A "Big 3" credit bureau is testing a direct data feed into a FICO score, and a top multifamily mortgage lender signed a multiyear contract with a high-profile fintech platform.

Late-payment rates are rising at nonbanks that lend to people with lower credit scores. "We're probably entering a stretch where you're going to see a separation between those that are relatively good underwriters and those that are not," one analyst said.

Even though delinquency rates were previously at extremely low levels, the recent uptick among poorer consumers is worth monitoring, New York Fed researchers said.

Silvio Tavares, the credit score company’s relatively new leader, is honing its models to be more inclusive, for instance by taking into account rent payment data and bank account data. 

The credit reporting agency is trying to get a CFPB lawsuit dismissed by claiming the consumer bureau didn’t sign off on a 2017 consent order for the same violations.

The use of rent data in credit models is allowing people with low credit scores or thin credit files to get loans. But consumer advocates warn the use of that data could harm the very people it’s supposed to help. 

The agency issued an advisory opinion warning that credit reporting bureaus and other entities using credit checks can no longer use disclaimers to bypass privacy protections.

The use of rent data in credit models is allowing people with low credit scores or thin credit files to get loans. But consumer advocates warn the use of that data could harm the very people it’s supposed to help. 

Fannie Mae and Freddie Mac asked originators to resubmit applications that contained errors and adjust sold mortgage information due to incorrect life-of-loan representations and warranties.

In the fourth quarter of 2021, home equity line of credit volume was up 31% from the same period the year before.

Borrowers must be protected against discrimination at all steps of the credit process — including after they’ve already been granted credit, the regulator affirmed.

During the pandemic, consumer lenders have found it easier to collect payments because the federal student loan moratorium has made many borrowers more liquid. A plan for blanket forgiveness reportedly under consideration by President Biden could sustain that trend.

Mortgage finance stakeholders must pay careful attention to “nuts-and-bolts” which, if ignored or misunderstood, can become landmines when implementing even the most well-intended new policies or practices writes a senior advisor at the Milken Institute Center for Financial Markets

While relatively few of these consumers have applied for mortgages recently, the findings point to an untapped market that lenders might be able to reach out to as refinancing dries up.

If lenders get to choose the credit-scoring model, the Big Three credit bureaus will likely set a price for VantageScore that is super low, so low that FICO cannot compete, just as Uber decimated the taxicab industry by setting prices artificially low until the taxicabs were gone, writes an attorney at the National Consumer Law Center.

Esusu, a financial technology company that aims to help bridge the racial wealth gap by reporting rent payments to credit agencies, has become one of only a few Black-owned startups to reach a valuation of $1 billion after closing a Series B round led by SoftBank Vision Fund 2.

In a letter to the agency’s new director, top Senate Democrats recommended policy steps intended to limit mistakes in consumers’ credit files that they said “can ruin lives.”

Companies using only a person’s name and not other identifiers to screen job and tenant applications can produce inaccurate information, according to the bureau. The agency's advisory opinion said such practices violate the Fair Credit Reporting Act.

A report by the agency found that consumers in majority Black neighborhoods were more than twice as likely as those in white neighborhoods to lodge complaints with the credit bureaus over information in their files. Meanwhile, disputes were less common among older borrowers.

Those leaving forbearance or other relief plans generally had higher credit utilization rates, were more likely to have mortgages, and experienced lower levels of bank card delinquencies, according to TransUnion.