Got a low credit score and can’t get a loan? Don’t fret over it, just subscribe to a magazine. Sounds absurd doesn’t it? According an article on MSN, banks are using other means to determine your credit worthiness. We all understand alternative credit, such as phone and power bills, but companies are now considering consumer data such as magazine subscriptions, the stores your shop at, what you purchase, what restaurants you eat at and how much you spend at them. Based on your consumer data a risk score on your ability to repay a loan is determined.
“Critics say the changes could make millions of borrowers appear safer than they are, diluting the value of credit scores and reports. Others say the alternative metrics, like a consumers reliability in paying electric bills, don’t translate into a likelihood they will repay their loans”
The article is an interesting read and makes you wonder how much data is out there on each of us. What could possibly go wrong? See the entire article here.
The Head of FHFA, Mark Calabria testifies before the US Senate Committee on Banking, Housing and Urban Affairs…..
“In their current financial condition, the Enterprises are not equipped to withstand a downturn in the housing market.
Another sign of trouble ahead. Do we need to say more?
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