e-Loans Free Credit Score

e-Loans Free Credit Score




In the past 5 years in America, credit record, particularly credit scores have become the single most important piece of data used to determine whether consumers can get a loan and, as importantly, how much consumers have to pay and what terms, They accept. More than 75% of the mortgage decided to use credit scores in the underwriting process. Credit scores are also widely used in automobile loans, credit cards and other consumer transactions decided diversification, insurance, and even rent qualifications, e-loans free credit score.

Low scores can cost consumers very high financing costs. For example, recent consumer car loans standards, so that customers and the credit score of 720 or higher, and is generally considered a good score is to ensure that rate of 7.5%, while less than 680 customers and the score just 40 points, will be paid rate of more than 10%.

Show scores of electronic credits the Internet for free - to cut off credit

Because e-loans free credit score have become so profoundly important in determining consumer participation in the credit markets, electronic credits that it is essential that consumers, and their scores, so that they can better understand their Credit prospects and better manage their finances.

E-commerce is beginning to show consumer loans, their credit record, in February 2000, as our on-line debt management services. The personal security of a web site, consumers can receive free credit score and credit linked to understand what the scores mean that the typical range of what factors affect their credit scores and what consumers can do to improve their scores (see Figure 1).

In the first four weeks more than 25,000 consumers to their own credit records, free use of electronic loan services. Response consumers, many of them do not know they have a fraction, let alone its importance, in access to credit, it is very positive (see Figure 2).

Unfortunately, in April 2000, e-commerce e-loans free credit score free loan program to consumers was closed by the credit is under intense pressure from the creators of credit scores, fair, impartial and Isaac. Although e-business loans can access credit scores for processing loans, the data sources were available only as long as the loan does not indicate electronic scores to consumers. E-business loans are loans credit scores through a third party contracts for the supply of credit data through the three credit agencies, which in turn contracts for credit score algorithm from the fair, Isaac. Fair, Dihanyi saxophone contracts and credit to prevent any users with access to consumer credit score.

Consumer response to the closure of electronic loan services is a huge disappointment. People could not understand why they do not have a correct view on this extremely important personal information, especially when the loan was complete and unhindered access.



Opponents cite credit score disclosure consumers can not understand their scores

One of the reasons often cited by the consumer credit industry refused to disclose is that consumers do not understand what the results mean. E-business lending experience in the release of the consumer credit score to prove just the opposite. On the 25000 successfully obtain their credit scores before the closure, there seems to be a high level of understanding and positive consumer awareness.

Especially the Internet is a very effective medium for communication score data - so that consumers instant access to their own e-loans free credit score, links to the specific factors and data, the construction of the score, as well as general information on credit score. According to our experience, the lack of disclosure score more confusion to consumers.



"Game" Score and liability management

Another reason often cited by the consumer credit industry refused to disclose is that once consumers know what to enter their scores, they will "game" the system, the activities, leading to better results. Electronic loan-to-believe that this is why the disclosure of credit score needs - consumers need to be able to improve their financial situation, through knowledge and understanding. This is called effective consumer debt management.



Credit industry response to legislation, but still does not allow disclosure of score

After the recent legislation requiring the disclosure of credit scores to move the California Assembly and the Senate (California Senate Bill 1607), a fair, just and Isaac announced that the general credit score, will be made available to consumers. While this is a step in the right direction, fair, Isaac still refused to allow disclosure of the actual scores or specific factors have an adverse impact on individual scores. E-business loans attempts to re-establish its data feed for their free credit score disclosure has been refused by the continued contractual restrictions, fair Isaac.

At this point, is still unknown source will allow consumers to access their scores.



Score disclosure should enhance market efficiency

Credit Score is an effective measure of the credibility of consumers, and has led to increased efficiency in the lending industry. However, the lending market, based on e-loans free credit score can only be efficient and fair, and if the two sides lenders and consumers have full transparency into the scoring system. As it stands today, an important market participants - the consumers - not to have transparency, to prevent them from optimize the credit decision.

Credit score of transparency, consumers should make the market more efficient and the lack of transparency can be seen as a market failure, in a single company that is blocking many of the benefits of market participants. We believe that legislation to allow credit score disclosure to the consumer, will correct this market failure.