@Anonymous wrote:
@Anonymous wrote:
@Anonymous wrote:
@Anonymous wrote:
@Gunnar419 wrote:What everybody else just said.
There has recently been a lot of talk about incorporating rent and utility payments into the scoring models. It's certainly something that would help people who don't use credit to build a verifiable financial record, however the enlarged reporting and data gathering that would be required is huge.
I think that is part of the 09 model but I might be wrong.
How will they deal with the optional reporting issue? Unlike major financial institutions, most landlords are not going to waste their time and effort reporting on time rent payments to the CRAs. I doubt incorporating rent payments will make any difference for most renters. Utility companies on the other hand might be willing to report, but with all the smaller local utility companies that exist nowadays, many of them will likely choose not to even if utility payments are incorporated into newer FICO scoring models. Making reporting mandatory might fix this, but can you imagine the chaos that will create for small landlords and the like? Simply put, I doubt most of us can rely on rent, or even utility payments, to help our scores in new scoring models.
No clue how they will do it. I just know that there is a push for people that rent, pay utilities, etc to get credit for on time payments. Seeing hothey can certainly be reported for not paying it seems fair to report the positive as well. How much can be forced upon landlord, apt complexes and utilities is up in the air. It will be interesting to see how this all develops.
Currently all reporting is 100% optional. No lender, including major banks, are required to report. If reporting remains optional, I don't see landlords choosing to report as it will be a burden for them. Making reporting mandatory is a whole different ballgame, but I seriously doubt it will happen. I have not heard of any serious push towards these changes other than occasional complaints from people on these forums. Also, nothing I have read about the FICO 9 scoring model suggests things like rent or utility payments will be reported or considered.
Furthermore, any change would have to be made at multiple levels. FICO itself cannot mandate reporting. Nor can FICO require the CRAs to change the information they collect. A legislative change would be required rather than merely a change of a scoring model by FICO. FICO 9 has already rolled out and none of the listed changes mention rent reporting or rent/utility bill considerations in the scoring. Perhaps future versions of FICO will, but for them to have any realistic impact, an official legislative change mandating reporting would likely be required. Personally, I don't see that happening anytime soon, but I have been wrong many times in the past. I guess we will just have to see
Legally it's optional, but the CRA's have some verbiage in their contracts regarding reporting consumer accounts from what I've heard when I was working at a non-trivial lender... and I would assume they probably discount the pull price as a result.
I don't really see how rental history will ever be reported short of going through an online clearing house for payments and reporting. Not seeing that as being likely with the majority of landlords, the major apartment businesses might, but there's so many one-offs and small complexes that it'd be nearly impossible to do so. If I rent out the theoretical future condo someday how would I as the average person report? I could figure it out since I know how to do it but that's some incredibly small fraction of the population.
I don't really think people would choose one rental over another based on whether they report payments or not. People don't care that much and I can't see any other way to drive the landlords to doing so.
