Potential Impacts of Credit Reporting Public Housing Rental Payment Data
Private credit rating firms use personal financial histories of U.S. consumers to estimate credit ratings that determine their access to affordable financing for homebuying and other purposes. Households with limited assets or credit histories may lack sufficient data to achieve good credit ratings. To examine potential alternatives to building credit histories, this study incorporated rental payment data from public housing residents into two credit rating calculation models: FICO 9 and VantageScore 3.0. The results of this preliminary research show that including rental history in credit reports could increase the proportions of tenant with scoreable credit histories and with good credit scores, but the change could be detrimental to credit scores for a subset of tenants.