ESTATE


How will foreclosure affect credit scores?
2009/03/16, 6:28 pm
Filed under: 1 | Tags: , , ,

The amount of damage to a credit score caused by foreclosure, deed in lieu or a short sale during 2008 and 2009 may be mitigated by the slower economic times, say some credit and legal experts.

FICO may have to adjust its credit scores to lessen the impact of a foreclosure in the last two years, says Todd J. Zywicki, a professor of law at George Mason University.

”It just seems obvious that a foreclosure in 2008 or 2009 doesn’t have as much information value as a foreclosure five years ago,” he says. ”To the extent that foreclosure doesn’t predict future behavior as much as it did in the past, you’d expect that the FICO algorithm would change to adjust for that.”

One of the country’s largest credit unions Golden 1 has already figured out a way to lend to people with a foreclosure on their record by offering a mortgage repair loan specifically for those who have lost a home to foreclosure and who want to buy a new one.

BECU, another large credit union based in Washington State, is about to present a program to fellow lenders, ”How to Lend to the Newly Credit Impaired.”

Source: The New York Times, Ron Lieber (03/14/2009)

http://www.realtor.org/RMODaily.nsf/pages/News2009031606?OpenDocument

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[…] Original post by mhanna43 […]

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[…] Original post by mhanna43 […]

Pingback by How will foreclosure affect credit scores? · Real-Estate.ExplainedOnline.Net

Greetings all members,

I would just like to say hello and let you know that I’m happy to be a member – been a lurker long enough 🙂

Hope to contribute some and gain some knowledge along the way….

Comment by FinancialServicesRenoNV




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