3-On Your Side: New Type Of Credit Report
By Jim Donovan
PHILADELPHIA (CBS) -- Looking to apply for credit? You may find that lenders now know more about you than ever before. As 3 On Your Side Consumer Jim Donovan finds, a new kind of credit report is packed with information about how you handle everything from your electric payments to your past rent.
Most people realize their credit report will dictate whether they get a loan for anything from a car to a house, and if so, what interest rate they'll pay. But now, a new kind of credit report, called Core Score, contains information that digs deeper than ever into your payment history. According to Chi Chi Wu with the National Consumer Law Center this information includes, "rental applications and evictions, pay day loans, auto title loans, rent to own transactions." It's all intended to give a lender a better idea of who is asking for money and the likelihood of it being paid back.
So where do they get the information? John Ulzheimer with SmartCredit.com says, "From the public records system, and traditionally credit reports only hold three types of public records; bankruptcy, tax liens and judgments."
Woo is concerned that people who had legitimate reasons for not paying certain bills will now be penalized. She says for example, "If there are mice running around, if you don't have any hot water, you're allowed to not pay your rent under some jurisdictions. Is the new credit report going to reflect that?" Another concern is what else could be added to these reports. According to Woo, "With the push of a button you can aggregate billions of pieces of information about anything and turn it into a consumer report."
Ulzheimer believes the new reports will help both lenders and consumers. He says, "Now consumers who deserve the credit are going to get it. those who deserve it at competitive terms are going to get competitive terms, and those who frankly don't need to be saddled with that type of debt are going to be denied."
Core Logic, the company behind the Core Score Credit Report says that borrowers with insufficient credit histories may be able to benefit when this additional information is included in their reports. To get a free copy of your Core Score Credit Report you can call 1-877-532-8778.
