A Methodology for Calculating a Score Consistency Index


Date: April 16, 2008

Typical real estate underwriting procedures require three credit scores for assessing a consumer’s creditworthiness – one score from each of the three national credit reporting companies (CRCs). Lenders require that these scores are accurate in predicting credit risk and also highly consistent in their absolute value across the CRCs. Scoring algorithms that provide inconsistent scores can increase the risk exposure that a lender takes on, resulting in less attractive products and pricing offered to the borrower…

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