The ranks of thin file consumers continues to grow in this country. According to Experian these consumers now number 25% of the total U.S. population. These are people with five or fewer items in their traditional credit history.
Clarity Services is a credit bureau covering this non-prime population (you can listen to my podcast with Clarity founder Tim Ranney from last year). They have 65 million consumers in their database with a majority of these people not being covered by the traditional credit bureaus. Experian has been buying data from Clarity Services for many years but they decided last year to acquire the company.
Since the acquisition they have worked with the Clarity Services team to build a new score specifically for the non-prime segment. They are calling it the Clear Early Risk Score. As the name implies this new score is designed to give lenders a clearer view of the risk of these thin file consumers, many of whom should not be categorized as subprime.
I spoke with Alex Lintner, the president of Experian Consumer Information Services, last week to learn more about this new score and what it means for consumers.