Unreported account payments may help when applying for mortgage
By Kenneth R. Harney, Special to the Times Friday, May 13, 2011
Giving credit to the prompt bill payer
WASHINGTON — Some credit experts call it the best-kept secret in home mortgage finance. Others say, so what?
Millions of Americans whose credit scores have declined in recent years because of economic stresses could start rebuilding their scores if their rent, utilities, cell phone, insurance and other monthly accounts were reported to the national credit bureaus.
But typically they are not, and as a consequence they fail to show up as positive factors on credit scoring systems such as FICO or VantageScore. These on-time payments essentially go to waste for consumers, even though monthly rents often can be as large as mortgage bills, and years of utilities and other payments are widely recognized as strong indicators of creditworthiness.
Now for the best-kept secret: Under federal law, these unreported accounts need not go …
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