Sponsored Content from Equifax: Differentiated Insights to Expand Access to Credit

The purchase of a home is a critical first step to establishing wealth for many Americans. Yet, credit-invisible consumers can struggle to take the first step into homeownership. These consumers must go through a time-consuming manual underwriting process of obtaining physical documentation to show they have credit history when applying for a mortgage loan.

The housing industry has long served as the engine for our national economy with homeownership often considered as a primary contributor to wealth building for the majority of the United States. With advancements in certain differentiated insights, the industry is finally in a position to extend this opportunity to even more Americans – providing benefits on a national scale.

We recently sat down with Craig Crabtree, Senior Vice President and General Manager, mortgage and housing for Equifax, to learn more about how access to telecommunications (telco), pay TV and utilities insights can benefit the entire mortgage industry.

How can the mortgage industry improve financial visibility for all mortgage applicants and ultimately help open the door to home ownership for millions of Americans?

Craig Crabtree

CRAIG CRABTREE: The entire mortgage industry is placing an increased emphasis on expanding access to credit for all. To help facilitate greater inclusion to the mortgage lending process, we are all working together to introduce more tools, technology advancements, and access to data to provide visibility to millions of consumers.

As we know, mortgage credit reports continue to provide an indication of credit history and past financial behaviors. However, reviewing differentiated forms of data, such as telco, pay TV, and utilities attributes, can help provide greater visibility of a borrower’s financial profile. 

How does using telco, pay TV, and utilities attributes alongside traditional mortgage credit reports help create greater homeownership opportunities?

CRABTREE: Traditional credit reports remain a strong indicator of credit history and past financial reliability, but thin, young, and unscorable consumers may have thin credit files or no credit file. Delivering differentiated insights, such as telco, pay TV, and utilities attributes with traditional credit reports can help provide additional insights on 191 million U.S. consumers.

How does differentiated insights expand the customer base?

CRABTREE: A traditional credit history consists of whether payments are made on time, what debt a consumer owes, and what might be in collection. This credit history is then used to help determine creditworthiness and costs of credit.

This new offering is another way that we are leveraging differentiated data assets to help more consumers gain access to mainstream financial services and opportunities. By delivering certain attributes, which are based on a consumer’s aggregated history of telco, pay TV, and utilities, Equifax is able to provide powerful new insights that help to automate, save time and resources, and streamline the first mortgage process for every applicant – creating more potential for consumers to secure a loan.

How will the mortgage industry benefit from the use of telco, pay tv, and utilities attributes?

CRABTREE: Delivering differentiated insights with traditional credit reports will help provide lenders additional visibility on 191 million consumers, of whom 38 million are “credit-invisible” or “unscorable” consumers. Reviewing traditional credit reports alongside alternative data insights enables the mortgage industry to develop a more complete picture of a consumer’s financial profile to drive greater financial inclusion by potentially streamlining the mortgage underwriting processes for many more consumers. This new offering provides lenders differentiated data assets to help more consumers to gain access to mainstream financial services and opportunities.

By delivering telco, pay TV, and utilities attributes alongside traditional mortgage credit reports, lenders have the ability to access insights that are not typically available through traditional credit reports, providing a more comprehensive view of a borrower’s true creditworthiness.

Equifax is the only credit reporting agency that can deliver these valuable insights at no additional cost to lenders. The inclusion of these differentiated insights to mortgage lenders is just one of several ways Equifax is promoting greater access to credit. Equifax is committed to removing barriers to financial inclusion, supporting a number of industry initiatives designed to offer underserved populations with the same opportunities to succeed and benefit from the nation’s financial system as others.

Equifax looks forward to partnering with the industry to unlock the full potential of telco, utility, and pay TV insights to better support consumers in their pursuit to qualify for a mortgage loan, helping people live their financial best. For more information on Equifax Mortgage and Housing Solutions, visit equifax.com/mortgage.

(Sponsored content includes material submitted independently of the Mortgage Bankers Association and MBA NewsLink and does not connote an MBA endorsement of a specific company, product or service. For more information about sponsored content opportunities, contact Bill Farmakis at bill@jlfarmakis.com or 203/834-8832.)