It’s so difficult to get a loan based on current standards.
It used to be that bankers had a personal relationship with potential borrowers and looked at credit as something individual and asked questions, fico scores don’t tell the whole picture. When i am interviewing a tenant, i ask them to explain negative items. If it sounds reasonable, i overlook them. That can’t happen when it’s an impersonal thing like a computer spitting out Fico scores.
Housing and Urban Development (HUD) Secretary Julian Castro, said that the calculation of credit scores “needs to change to reflect how people live their lives today, or millions of people will continue to fall outside traditional calculation models and not be able to become home owners.”
HUD was looking at the credit scoring issue as part of its effort to improve Americans’ credit access. “There’s been a disconnect there,” the Secretary said.
Minorities and millennial don’t necessarily use credit the same way
Non-traditional charges as rent and utility payments although they are not yet incorporated into their scoring models need to be added. Fair Isaac Corp, which produces FICO scores, said it has also changed the way it handles medical collections, among other things, so people aren’t unfairly penalized for non-recurring problems.
