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Lending Dilemmas

BY BILL HULSTRAND

Decision-making guidelines for members with high debt

Credit reports are useful for credit unions when making lending decisions, but they don’t tell the whole story. See why even very good credit scores can bode trouble down the road. This decision guide can help serve as your crystal ball in predicting what the future might hold.

Although technology and credit reports have improved substantially over the years, lending is still just as much of an art as it is a science. Credit reports can only tell you so much about a member’s financial situation. What they can’t tell you is “What is this member’s ability to repay going to be 24 months from now?” Of course, no one can predict the future with 100 percent certainty, but we believe that there are tell-tale signs of impending trouble in most cases. Wouldn’t it be great to able to predict which of your members with really good credit scores (700+) are headed for future trouble?


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