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New Services Present Another Reason To Pay Your Rent On Time
from the the-long-tail-of-credit-rating-agencies dept
The business of tabulating and reporting consumer credit scores is one of centralizing diffuse information and then reselling it to clients. But the internet has proved a challenge to this business model, and this space will likely be no different. Already, niche startups are emerging that circumvent the oligopoly of FICO score reporting agencies. These companies allow landlords to share information directly with other landlords about tenants' rental histories, potentially allowing them to avoid paying an incumbent reporting agency for a credit report. Other services target tenants, offering them the opportunity to present their own rental history. Of course, the established agencies may look to license this data, to better flesh out their own scores, but this doesn't change the fact that the internet allows peers to coordinate and share information with each other without the need of a centralized authority. Combined with nascent models such as peer-to-peer lending exchanges, services such as these may help disrupt financial institutions that have so far been very slow to adapt to new technologies.
Reader Comments
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Scary stuff
- All these databases - some containing very personal information, some storing inaccurate data.
- Consumers having very little control over the information that is kept on them.
- Regulations designed for a different era.
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Hmmm...don't like this
I don't think that this type of service should be offered without some sort of strong verification about *who* is using it (the information in the wrong hands could lead to identity theft). I also think it should be an opt-in type of service, one where consumers can say that it is ok to share this information over the internet.
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Excellent
I realize no one pitys the small businessperson on techdirt, but this could stop the folks who make it their business to cheat landlords in a serial fashion.
A few controls, similar to those on the big scoring agencies, will do the trick.
When applying to rent, you'll agree that your information can be shared with credit reporting agencies, if you don't already. Or, you'll pay a premium to rent someplace that accepts folks who don't want their bad prior history explored.
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Opt-In does not work.
In the beginning, you will be allowed to opt-in, and everything will be fine. Later more select rentals will require you to opt-in and/or have a rental history. Then this will trickle down to every rental where if you choose not to share your data in this system, you do not get to apply. This is essentially what happens with credit cards. Every application says they share your data with credit agencies, if you don't accept the terms you don't get a card.
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What constitutes predatory lending practices? What's to stop this from becoming predatory renting?
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About time
This has been due for a long time. Hopefully now it will be easier to determine and make known a bad tenant.
Mind you, as when using Credit Checkers, you most likely would need to supply proof (usually by fax) that the person you are looking up signed an application, clearly stating you will look up their information. The company cannot be that stupid to give out information to anyone, as there would be legal issues.
Very great service! Can't wait to use it.
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