At Palm State Mortgage Company, we think you will be hearing a lot about the term “Trended Credit Data,” in the near future. In fact, your trended credit data might become as important as your credit check and your credit history when you apply for a loan.  You might think of it as your financial pulse or perhaps your debt pulse!

Trended Credit Data: Your Financial Pulse

Recently the National Mortgage Professional Magazine reported that trended credit data would be a “huge development for the industry and is going to vastly change underwriting decisions for many consumers when it goes into use on Monday, June 27, 2016.”

If you are dreaming of financing a house, you need to be aware of the power of “Trended Credit Data.”  This week, Palm State Mortgage Company Blog brings you a closer look at some fascinating features of this new term, trended credit data and the technology behind it.  Read on to learn how it can affect your capability to finance a home!

Trended Credit Data:  How You Spend Credit!

Put simply, your trended credit data will offer lenders a more developed, detailed view of your credit history.Palm State Mortgage explains trended credit data.

1.  Trended Credit Data explores and analyzes the your payment history with credit accounts. It checks up to 30 months into your credit past. This has not possible with our current credit report data.

2.  This detailed information allows lenders to make better decisions than today’s credit report data. ()

3.  Even today, three national credit bureaus deliver some trended credit data. However, in June, Fannie Mae will require it.

4.  As of June 26, Fannie Mae will demand trended data sets from TransUnion’s CreditVision and Equifax’s Dimensions.  Experts believe that  Experian’s trended credit data could become a part of the requirements shortly after the Fannie Mae roll-out.

The big take-away for borrowers is that the new detailed view of your credit history, the Trended Credit Data, can divulge your spending habits and behaviors to creditors in new ways. Currently credit reports show only recent payments on an account.

Trended Credit Data:  Your Palm State Mortgage Company Primer of Credit Consequences

Beware!  Just as doctors can check your charts to determine symptoms of oncoming disease, lenders will soon be able to check more about the vital statistics of your fiscal health than ever before!

With the new trended credit data, lenders can:

A. See the details of your balance and payment each month on revolving charge accounts.Trended Credit Data Check Tells All About Credit Health

B. Analyze your financial consistency in paying more than the minimum required payment.

C. Conclude you are reducing total amounts borrowed.

D. Calculate how you are decreasing your debt utilization.

E.  Be aware, with this data, lenders will be able to see if you are spending more and more each month and making smaller and smaller payments to your creditors.

F.  Likewise, they can use the data to figure out how much of a credit risk you will be when you borrow from them to finance your home. We repeat,

“These payment trends cannot be seen on standard versions of the consumer credit report or picked up by any of the traditional risk scores that use the current non-trended data to calculate the score.”

–And we caution youto remember, these new style reports will be permitted to go back 30 months into your credit history, beginning this June! 

Trending Credit Data:  A Conundrum for Lenders and Homebuyers

Mortgage professionals do not know how underwriters will employ all the new trended credit data.  Will it help or harm a loan applicant that is on the borderline?

We can not yet predict if the credit score or the trended credit data will be the most important factor in procuring a good lender for you. Trended Credit Data Warning: Resist Credit Over-use!

For example, a home loan applicant’s trending credit data might demonstrate a steady rise in credit consumption for the last 30 months, yet he or she might have maintained a nice 750 credit score. Which will be more important in the eyes of prospective lenders–the credit score or the alarming and soaring credit usage revealed by the trending credit data?

Currently, all that we can say with certainty is that your trending credit data, your credit history, and your credit score will be critical to your success in gaining a good lender.

Lenders are simply going to be able to analyze your financial condition more closely, much as a doctor can measure your vital signs before making a diagnosis.

So if you are planning on buying a house in the near future, you need to begin resist overusing or underpaying those credit cards as soon as possible.

This has always been good advice, but now “Trended Credit Data” will be making it more important than ever in your fiscal life.

A Healthy Physical Life and A Healthy Fiscal Life!

Palm State Mortgage Company urges you to remember that potential home finance lenders see the trended credit data is your financial pulse.  Will your lender’s diagnosis make you a high risk case or a low risk case?  Stay Healthy, not only with the way you eat and drink and exercise, but in the way you spend!