Regulatory Changes to Credit Report Criteria – Good or Bad for consumers?
You got it right!
Starting 1st July 2017 there’s going to be slight regulatory change in the way credit scores are reported. Three national credit bureaus – Transunion, Equifax, and Experian will stop recording and reporting information like tax Lien and Civil Judgement (affecting positively millions of Americans).
This is good news for consumers. Many of you might be pleasantly surprised to see bump in your credit score post July'17.
Anyone who’s looking for that perfect home right now in market and who has had first meeting with lender for Pre-Qualification or for Pre-Approval knows first-hand importance of the Credit-Score and the way a good credit score can put you in better bargain position with lenders. You definitely know by now how it can directly affect your home buying capability.
Though removing most Tax Liens and Civil Judgement records from credit history improves Credit score of average consumers it really is not any indication of improved credit habits. This means Lenders will have to be careful as this might increase high risk of loan defaults (since, important indicators like Tax liens and Civil Judgments are not available).
In current housing market, in my view, this would mean more bold Buyers pushing those prices further higher up! While sellers are grinning, bold with new credit-score (and increased credit worthiness) buyers are likely to make this market more competitive (in lack of inventory and ever growing demand).