Shortly after the financial meltdown, lenders of all stripes pulled back their borrowing generosity. Credit card issuers slashed credit limits, while mortgage lenders and auto lenders approved only those with the most pristine credit.
Now, years removed from the credit crisis, lenders are looking for more borrowers but are still shying away from taking on extra risk. The key is finding consumers who are good credit risks, even if they are plagued by marginal credit scores or have no scores at all.
"Lenders want to grow their business, but they don't want to repeat the mistakes they made before the recession," says Ankush Tewari, director of strategy and market planning at LexisNexis, an alternative data mining company. "One of the ways to solve that problem is to look at other data sources to add to the traditional credit bureau files."