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New Study Shows How Rental Payment Data Impacts Credit Scoring

Phil Hall
Feb 14, 2020
Photo credit: Getty Images/scyther5

A new study exploring how consumer reporting agencies can use rental payments to determine the credit scoring has been released through a partnership between FICO, the Department of Housing and Urban Development (HUD) and the Policy and Economic Research Council (PERC).
The study, "Impacts of Credit Report Public Housing Rental Data," analyzed how so-called “credit invisibility” can limit housing options for approximately 54 million people, with the consideration of rental payment data in mitigating that situation. The study assessed credit scores of more than 9,000 HUD-assisted households across Cook County, Ill., Louisville, Ky., and Seattle using credit risk models, including FICO Score 9, and tracked how rental payment data to credit agencies could increase in the number of HUD-assisted tenants with credit scores above 620 while lowering levels of previously “unscorable.”
"Financial inclusion remains a top priority for FICO, so working with HUD and PERC on this study was a natural fit," said Joanne Gaskin, vice president of scores and analytics at FICO. "When we calculated FICO Score 9 for the study, we found that a majority of households who were previously unscorable received a credit score after the addition of rental payment data."

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