Due to tighter requirements from lending institutions, it is harder to qualify for a home loan than in years past making the American Dream unreachable for many consumers. However, if you are renting and plan to buy a home for the first time later this year, your chances of qualifying for a mortgage might be better if you’ve had a history of paying your rent on time, the New York Times reports.
According to an article earlier this week in the New York Times, last year Experian, one of the three leading credit-reporting companies, added a section to millions of credit reports showing on-time rent payments, which had a positive impact on the credit scores to some on-time rent payers. Now the other two credit reporting companies are following suit.
CoreLogic and FICO recently announced they are also adding a score that reflects payment histories from landlords, The New York Times reports.
Evidence of positive rental payments could be a plus for consumers, Joanne Gaskin, FICO’s director of product management global scoring, told The New York Times.
Nearly half of high-risk consumers saw an increase of 100 points or more after their rental history was added to their credit report, says Brannan Johnston, the managing director of Experian’s rent bureau. Consumers with average or higher credit scores, on the other hand, did not see any major difference to their scores.
For former home owners who lost their homes to foreclosure, may be able to rebuild their credit histories more quickly now by showing they are “very responsible renters,” Tim Grace, senior vice president of CoreLogic, told The New York Times.
Read the entire article from The New York Times ...
New York Times Article
No comments:
Post a Comment