Experian, one of the four major credit bureaus, is marketing a new product for consumers to report credit from non-traditional sources on their own. It’s called Experian Boost, and it’s touted as a way for consumers to increase their FICO credit scores. And all they have to have is a payment history for mobile phones and utility bills.
According to the Experian Boost website, the service is free. Consumers simply have to connect to their online bank accounts and select the mobile phone and utility payments they’d like to be considered. Experian then adds these payment records to your Experian credit report. Additionally, Experian Boost adds only positive payment records; late payments or missed payments are not.
Understanding FICO to report credit
The Fair, Isaac Company created the FICO consumer score. FICO is used primarily by banks and other lenders to evaluate a borrower’s credit risk. It draws from the four major credit bureaus to determine a score. A FICO score looks specifically at payment history, level of debt, types of credit used, length of history, and new accounts. Raising, or “boosting,” your FICO score can make it easier for you to borrow money.
NerdWallet also reports that Experian plans to launch an UltraFICO score later this year. UltraFICO will be a service that pulls information from checking, savings, and money market accounts to “supplement data already in your credit report.”
What this means to landlords, lenders, and HOAs
Do you extend credit to consumers but don’t yet report this information to the four major credit bureaus? If so, you should pay attention to these new services. You’re likely to see increasing FICO scores when you pull credit for loan or tenant applications.
But more importantly, products like these show that consumers are more interested than ever in adding non-traditional payments to their credit reports. These new options are similar to those that Datalinx credit reporting services company offers. Both Experian Boost and UltraFICO can help consumers with no thin or no credit histories build credit. They can also help those with poor credit repair their reports legitimately, by reporting positive payment behavior.
Unlike these credit bureau-sponsored products, though, Datalinx services also help you to report delinquencies, judgments, evictions, and skips. The more information that is added to a consumer’s report, whether positive or negative, the more accurate the report is for the next lender.
Sometimes, simply sharing with your customers or tenants that you report to the credit bureaus can have an immediate impact on payment behavior. Those who want to maintain a good credit probably won’t ever consider missing a payment. Plus, anyone working to rebuild their credit may be discouraged from damaging it even more with a skip.
To learn more about how you can report consumer credit to the credit bureaus, contact Datalinx today.
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