Your credit score may benefit from rent payments

For years, we’ve advocated giving consumers who are struggling to establish credit alternative ways to establish a positive credit history. Now, FICO and CoreLogic have partnered to do just that.

A new credit score has been devised that combines the data in one’s FICO file along with info gathered by CoreLogic about payments for rent, payday loans, court records, and more. The new score is expected to give lenders a better idea if renters are ready for a mortgage loan, with the goal of helping more households qualify for homeownership.

We’ve always believed that there were many consumers renting who were ready for homeownership, but their credit score made it impossible for them to get loans; the new score has proven to be even better at predicting risk of default, while allowing those without an extensive credit history to qualify for mortgage borrowing.

Another advantage to the new "CoreScore™" is that it is quicker to add consumer data to the file, giving lenders the data they need in less than half the time of traditional credit scoring.

And because CoreLogic worked with FICO to create this new scoring model, the resulting credit score is a true FICO score, ranging from 300 to 850, not an imitation "FAKO" score that lenders won't use.

Consumers can get a free CoreScore Credit Report by calling 877.532.8778 or visiting the consumer information page for CoreScore.

For more information about establishing or improving your own credit score, check out our "Consumer Guide to Good Credit", a free .pdf download from out FIT Academy