Who uses Credit Scoring?
Everyone these days that lends money – everyone that is, in the financial industry if they are a member of the credit bureaus. Credit scoring has proven to be the financing industry’s most reliable and quickest method of checking a borrower’s credit. Until now, the scoring part of your credit history has not been available to you. Credit scores are an objective and consistent measure for the credit industry as they can help predict loan, credit card, and credit default. Research shows that mortgages granted to applicants with lower credit scores did indeed have significantly higher default rates than mortgages granted to applicants with higher scores. How Credit Scores Work and Why it is Important to Monitor Them Credit scores, because of their predictive power, have become big business. They suggest that applicants with low credit scores should be required to provide a larger down payment, lower debt-to-income ratios, more cash reserves, and a history of a good payment record on housi
