In Search of High-Definition Credit Scores

Credit bureaus fine-tune their methods to get a clearer picture of borrowers post-crisis
Illustration by Sam Island

As banks tiptoe back into consumer lending, their biggest challenge is discerning good risk from bad. Lenders and credit bureaus are trying to devise new methods to sift through the Great Recession’s legacy of tarnished credit so they can find profitable customers. Some want to know whether a loan applicant pays his car loan before his mortgage. Others are scrutinizing child-care expenses for the first time. “Every bank is looking for more and more ways to understand what is a client’s payment behavior,” says David Bowen, senior vice president at Ohio-based KeyBank, which recently bought a $725 million credit-card portfolio and plans to start issuing cards on its own.

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