Have little-to-no-credit? It may have just gotten easier for you to get a mortgage
By Lucy Cohen Blatter |April 13, 2015 - 9:45AM
To qualify for a mortgage, you have to prove to the lender that you're good at paying back debts — makes sense right?— and the proof is in your credit score. The problem, of course, is that for those who don't have a credit score, either because they choose not to use credit cards or they can't get them due to bankruptcy or foreclosure, getting a mortgage can be nearly impossible.
But there may be hope for would-be house-hunters who are fiscally responsible but have little-to-no credit history: according to the Wall Street Journal, Fair Isaac Corporation (aka FICO), the credit score system used most often for mortgages, has announced a new credit score based on other financial data, such as cell phone, cable, phone, gas and electric bill payment history.
FICO plans to use that information (which they'll obtain through a collaboration with Equifax and LexisNexis) to create credit scores for up to 15 million more people. Currently, approximately 53 million people in the U.S. don’t have FICO credit scores.
Twelve of the country's biggest credit card issuers (whom FICO has yet to name) will use the new data to make decisions about offering credit.
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