Data Point: Credit Invisibles

"Consumers with limited credit histories reflected in the credit records maintained by the three nationwide credit reporting agencies (NCRAs) face significant challenges in accessing most credit markets.1 NCRA records are often used by lenders when making credit decisions. In particular, lenders often use credit scores, such as one of the FICO or VantageScore scores, that are derived entirely from NCRA records when deciding whether to approve a loan application or in setting a loan’s interest rate. If a consumer does not have a credit record with one of the NCRAs or if the record contains insufficient information to assess her creditworthiness, lenders are much less likely to extend credit. As a result, consumers with limited credit histories can face substantially reduced access to credit.."
credit, consumer finance