Portable credit reports could lower costs, but fraud worries persist

"The Broker Action Coalition noted in a February letter to the Federal Housing Finance Agency that consumers have their credit pulled an average of 2.5 times when getting a mortgage. Reducing this to a single pull would effectively lower the aggregate cost of credit reports from roughly $150 to $60 for the consumer."

"Brendan McKay, president of advocacy at the BAC, stated, 'I don't think it solves all of our problems; it's more than a Band-Aid solution... Can you just use that credit report I paid for?' the answer is no, and for no good reason."

"Mortgage industry proponents say the change would reduce the need for lenders to pull credit reports that ultimately fail to result in closed loan originations while also empowering customers."

"Credit reporting industry representatives, however, view the model as an open door for fraud and have showed skepticism from the start."

The Broker Action Coalition is advocating for consumer-controlled portable credit reports to minimize repeat credit pulls during mortgage searches. This model allows borrowers to authorize a single credit report for multiple lenders, similar to tenant screening reports. Proponents argue it would lower costs from $150 to $60 per report and empower consumers. However, credit reporting advocates express concerns about potential fraud risks associated with this approach. Currently, consumers face an average of 2.5 credit pulls when seeking a mortgage, which the BAC aims to reduce.

Read at www.housingwire.com