Re: Credit score - Landlord Forum thread

Re: Credit score by napolean (GA) on June 9, 2012 @04:11

Most renters probably don't have good credit scores which is the reason why they are renting (the other reason is that many cannot afford the 10% or 20% down payment on a mortgage).

Since I don't expect good credit scores, I look at the actual credit report. I look at how they paid bills recently. How many times were they delinquent in the last 3-6 months? If they didn't pay bills last month, what makes me think they will pay their rent next month? Which bills are they late on and how much was the monthlly payment that is in delinquency status? How many collections from apartment complexes, utility bills, etc. How many credit cards and other loans did they open and never made a payment (i.e. became delinquent 1 month after opening and charging off 4-6 months later). Foreclosures do not bother me because it simply means their payment was too high. However, I do want to know how much was the housing payment they struggled to pay. If the foreclosed housing payment was equivalent to what I charge in rent, it tells me that they probably will struggle with the rent payment.

By the way, there is a comment above saying "No one knows what goes into credit scores".. Actually there are statisticians at FICO, Equifax, Experian, and TransUnion who statistically derive those equations. So there are people who knows what goes into credit scores

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Re: Credit score by Anonymous on June 9, 2012 @17:07	[ Reply ]

The point is that no one outside of a select few in those organizations know the exact formula. If you don't know the formula, you can then only make certain generalizations about how well the formula applies to your scenario.