Wendy Hannah-Olson: Alternative sources of credit data are the next step for mortgages

PERSON OF THE WEEK: Technology continues to transform the mortgage market, reducing operating costs, creating more efficient processes and improving the borrower experience. The next step in AI-powered underwriting is the use of alternative sources of credit data, which could potentially allow lenders to serve millions of creditworthy but “underserved” borrowers.

In a recent interview with MortgageOrbWendy Hannah-Olson, Vice President, Head of Strategy Execution, Mortgages and Housing for Equifax, discusses how using other sources of credit data could open the door to homeownership for “invisible credit” or “light files” borrowers.

Q: What is the most exciting and/or remarkable transformation you have seen in your 25 years in the mortgage industry?

Hannah Olson: Early in my career, credit reports used in the mortgage industry were created manually, delivered by courier, and took two to three days to complete. While that was quite a while ago, it was actually the start of the digital age.

Today, thanks to technology, we deliver credit reports in an instant. This monumental shift from manual to automated has allowed the industry to begin meeting new generations where they are, allowed companies to grow beyond regional or local sales, and started the journey to dematerialization.

How many trees have been saved by our introduction of credit data automation and fusion and instant delivery? I expect billions!

These technological advances have also helped the mortgage industry to effectively manage the many changes the market has seen, especially in recent years. To succeed today, mortgage professionals must increase efficiency, which means using technology to automate, simplify and speed up every step of the mortgage process.

Q: Digital transformation has been on the industry’s agenda for several years. While we obviously continue to evolve and mature from a digital perspective, what do you think is the next big issue facing the industry?

Hannah Olson: While working toward a complete end-to-end digital mortgage is important, lenders must also continue to find ways to ensure financial inclusion for all consumers, including marginalized communities. The mortgage industry as a whole is working to remove barriers to homeownership for minority and marginalized groups, which requires additional tools, advances in technology, access to data and specific programs tailored to certain populations.

Although credit reports continue to provide an indication of past credit history and financial behavior, other forms of data should be considered to get a broader picture of a person’s complete financial health, especially that a large portion of the American population is considered “invisible when it comes to credit.” meaning they have no credit history. Others are considered “light files,” meaning they have too little data to calculate a traditional credit score. This alternative data includes rent payments, utility payment information, and even bills and cell phone payments.

Compiling these alternative forms of data with traditional credit information opens the door for more people to get a mortgage. Although it is currently difficult to collect and report this data accurately, the industry is working to address it, as it would benefit marginalized communities unable to prove their financial reliability with traditional methods, creating more minority owners and ultimately benefiting society as a whole. .

Q: What is your greatest career achievement?

Hannah Olson: I wouldn’t say I have a single greatest accomplishment; I would say it’s an ongoing accomplishment. With the products and services our company provides to the industry, I take an active role in helping consumers realize their dream of home ownership – getting the keys to their dream home or refinancing the home they’re in. are already found. It feels good to help consumers live their best financially.

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