| The banking industry is starting to
look beyond traditional credit reports and scores as the
primary indicators of consumer creditworthiness. The industry
is realizing that just because a consumer does not have
a complete traditional credit history does not mean they
are a credit risk. For example, many people do not believe
in debt, they make payments on time and they have a decent
amount of money in a savings account.
In the past, it was difficult for lenders to ascertain
the credit risk for these consumers. However, that has
all changed. Innovative new products, such as the Anthem
Report from First American CREDCO, judge a person’s
credit worthiness by looking at alternative payment
histories such as rent, utility and insurance payments.
By examining these payment histories, lenders can accurately
determine the relative credit risk for a consumer. As
a result, many consumers with strong alternative payment
histories can now qualify for the same loans as consumers
with traditional credit histories and scores.
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