SOUTHFIELD, Mich. — 700Credit, a provider of credit reports, compliance solutions and prescreen products, today announced an alliance with FactorTrust to provide auto dealers with access to alternative credit information for customers who have thin credit files or are underbanked.
Many customers who lack the traditional loan tradelines, such as credit cards and mortgages, still have verifiable payment histories through transactions such as short-term or installment loans, credit and prepaid cards, nonprime automotive loans, retailers, wireless services and collection agencies. FactorTrust provides unique credit data that incorporates these alternative credit sources that are not reported by the Big 3 credit bureaus.
"There is a growing need in the auto industry to provide predictive alternative data sources for potential customers that might have gaps in traditional credit information," said Ken Hill, managing director of 700Credit. "FactorTrust provides information that can help auto dealers qualify more customers and increase conversion rates. Providing access to alternative forms of payment history is a win-win for both dealer and consumer."
The alternative payment information is particularly valuable to buy-here, pay-here dealers, who typically cater to consumers considered nonprime or underbanked. Providing alternative sources of payment histories in consumer credit reports can make the difference in a successful sale.
"Relying entirely on traditional data sources does not provide the complete picture of consumers with credit scores under 700," said FactorTrust CEO Greg Rable. "Combining alternative credit data with traditional credit data gives a comprehensive overview of a consumer. As a result, lenders unearth creditworthy prospects that are not surfacing via traditional credit sources. Subsequently, consumers are evaluated by the whole of their financial decisions – not just a snippet."
Originally posted on F&I and Showroom