If these new systems are widely accepted, there will be
a flood of mortgages in default within a year or two
of the sale. I worked 10 years in "second-chance" financing for automobiles and what the lender sitting in his/her office will not know is this....How many illegals
will be living in that house and what per cent of the rent are they responsible for? When they move out, or are caught and sent back, will the person whose NAME the loan is in be able to make up that protion of the payment?
Who was the "landlord" that provided rent receipts to help the illegal applicant establish a payment history: brother, cousin, uncle? Is that payment history even legitimate? Etc, etc., etc., These are the problems we encontered on auto loans approved thru sources other than those using credit scores....fraud, fraud, and more fraud.
Over 10 years, I worked for Mercury Finance,Reliance Acceptance, First Merchants Acceptance, and Long Beach Acceptance. All are now out of business. Each one had their own "alternative scoring" system.....