New Consumer "Payment Hierarchy"

Credit Card Bills Trump Mortgage Payments I attended a private dinner this week where the featured speaker, a senior executive at FICO, offered a wide range of comments. Since the talk was off-the-record, I won’t mention the individual’s name, but the insights were fascinating. In a nutshell, FICO is observing a sea change in how...
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FICO’s Decline (& Fall?)

Credit Rating Agencies, Writ Small As a long-time lender, I would always trade off fico for equity. —email from Angelo Mozilo, Countrywide CEO (now charged with civil fraud), to a lieutenant What exactly is Mozilo talking about? Sub-prime lenders’ growing concerns, circa 2006, that the size of a borrower’s down payment was a much better...
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Credit Score Pitfalls

Cash Buyers “Off the (Credit Score) Radar”I can’t say I’ve run into any as clients, but an article in today’s Wall Street Journal makes the counter-intuitive point that simply not using credit — as opposed to using it irresponsibly — can lower your credit scores (“Credit Score Pitfalls of the Wealthy“). As the article notes,...
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