Wendy Hannah-Olson: Alternative Sources of Credit Data are the Next Step for Mortgage


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-driven underwriting is the use of alternative sources of credit data, which could potentially enable lenders to serve millions of creditworthy yet “underserved” borrowers.

In a recent interview with MortgageOrb, Wendy Hannah-Olson, vice president, strategy execution leader, mortgage and housing for Equifax, discusses how the use alternative sources of credit data could open the door to homeownership for “credit invisible” or “thin file” borrowers. 

Q: What is the most exciting and/or noteworthy transformation you’ve seen over your 25 years of experience working in the mortgage industry?

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

Today, thanks to technology, we deliver credit reports in an instant. This monumental shift from manual to automation allowed the industry to start meeting the newer generations where they are, enabled companies to expand beyond regional or local sales and started the journey to go paperless.

How many trees have been saved with our introduction of automating and merging credit data and delivering it instantly? I hope billions!

These technology advancements have also helped the mortgage industry efficiently and effectively manage the many shifts the marketplace has seen, especially the last several years. In order to succeed today, mortgage professionals must increase efficiencies, which means utilizing technology to automate, simplify and speed up each step of the mortgage process. 

Q: Digital transformation has been a big focus for the industry for the past several years. While we’ll obviously continue to evolve and mature from a digital perspective, what do you see as the next big issue facing the industry?

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

While credit reports continue to provide an indication of credit history and past financial behaviors, alternative forms of data should be considered to gain a broader picture of one’s complete financial health, especially since a large part of the American population is considered “credit invisible,” meaning they do not have a credit history. Others are considered “thin file,” meaning they have too little data to calculate a traditional credit score. This alternative data includes rent payments, utility payment information and even cell phone bills and payments. 

Compiling these alternative forms of data along with traditional credit information opens the door for more individuals to obtain a mortgage. While it is currently a challenge to collect and accurately report this data, the industry is working to remedy that, as it would benefit those marginalized communities unable to prove their financial dependability with traditional methods, creating more minority homeowners and ultimately benefiting society as a whole.

Q: What is your greatest accomplishment of your career?

Hannah-Olson: I wouldn’t say I have a single greatest accomplishment; I would say it is an ongoing accomplishment. With the products and services our company provides to the industry, I play an active role in helping consumers accomplish their dream of homeownership – get the keys to the home of their dreams or refinance the home they are already in. It feels good to help consumers live their financial best.

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