Bill Overview
Title: Credit Access and Inclusion Act of 2022
Description: This bill allows for the reporting of certain positive consumer-credit information to consumer reporting agencies. Specifically, a person or the Department of Housing and Urban Development may report information related to a consumer's performance in making payments either under a lease agreement for a dwelling or pursuant to a contract for a utility or telecommunications service. However, information about a consumer's usage of any utility or telecommunications service may be reported only to the extent that the information relates to payment by the consumer for such service or other terms of the provision of that service. Furthermore, an energy-utility firm may not report a consumer's outstanding balance as late if the firm and the consumer have entered into a payment plan and the consumer is meeting the obligations of that plan. Specified provisions that establish civil liability with respect to furnishers of information to consumer reporting agencies shall not apply to any violation of the bill. The Government Accountability Office must report on the consumer impact of such reporting.
Sponsors: Rep. Hill, J. French [R-AR-2]
Target Audience
Population: People utilizing credit reports featuring rental, utility, or telecommunications payment data
Estimated Size: 250000000
- The bill impacts consumers whose payment history can positively influence their credit scores, especially those who aren't traditionally covered by credit reporting agencies.
- People who rent their homes and want their rent payments to be reported for credit purposes are directly impacted.
- Individuals who pay for utility and telecommunication services and want those payments reported for credit purposes are affected.
- Since the bill avoids reporting payments as late if there's a payment plan in place, it supports financially vulnerable individuals who might need such plans.
- Bill influences lenders and financial institutions reliant on comprehensive credit reports for assessing creditworthiness.
Reasoning
- The Credit Access and Inclusion Act of 2022 targets expanding credit accessibility for individuals whose financial activities, like rent or utility payments, were previously underrepresented in credit reporting, potentially improving credit scores.
- Given the policy's focus, the simulated population includes consumers across a range of socio-economic backgrounds, with an emphasis on renters and individuals with utilities or telecommunication services.
- Financial vulnerability is directly addressed by ensuring consumers engaged in payment plans are not negatively impacted.
- The policy impacts could range from 'none' for those already with high credit scores and comprehensive reports, to 'high' for those previously unreported or with limited credit history.
- This simulation accounts for the budget, focusing on plausible real-life application impacts for assessing wellbeing, suggesting that large-scale modeling considers socio-economic diversity and potential differences in impact across various communities.
Simulated Interviews
Administrative Assistant (Chicago, IL)
Age: 29 | Gender: female
Wellbeing Before Policy: 4
Duration of Impact: 8.0 years
Commonness: 15/20
Statement of Opinion:
- I always pay my rent and utilities on time, but it hasn't really helped my credit score. This policy might finally recognize my consistent payments.
- It would be a relief if my utility payments improved my credit; maybe I could qualify for better loan terms.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 4 |
| Year 2 | 6 | 4 |
| Year 3 | 6 | 4 |
| Year 5 | 7 | 5 |
| Year 10 | 7 | 5 |
| Year 20 | 6 | 5 |
Freelancer (Houston, TX)
Age: 42 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 12/20
Statement of Opinion:
- I think it's fair that my utility payments contribute to my credit score.
- I've had some struggles getting loans even with a solid track record of paying bills. This could help.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 7 | 6 |
Retired (Phoenix, AZ)
Age: 68 | Gender: female
Wellbeing Before Policy: 9
Duration of Impact: 0.0 years
Commonness: 10/20
Statement of Opinion:
- I have a good credit score and don't anticipate this policy will affect me much.
- It seems more beneficial for younger folks or those trying to build their credit.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 9 | 9 |
| Year 2 | 9 | 9 |
| Year 3 | 9 | 9 |
| Year 5 | 9 | 9 |
| Year 10 | 9 | 9 |
| Year 20 | 8 | 8 |
Small Business Owner (New York, NY)
Age: 55 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 2.0 years
Commonness: 14/20
Statement of Opinion:
- It's good in principle, but I don't think it affects me directly since most of my payments are business-related.
- My personal credit is already strong.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 8 | 8 |
Student (San Francisco, CA)
Age: 23 | Gender: other
Wellbeing Before Policy: 5
Duration of Impact: 7.0 years
Commonness: 18/20
Statement of Opinion:
- If my rent payments can help me build credit, that's fantastic!
- I'm planning to apply for student loans, and improving my credit would be a huge help.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 7 | 5 |
| Year 3 | 8 | 5 |
| Year 5 | 8 | 5 |
| Year 10 | 8 | 5 |
| Year 20 | 7 | 5 |
Utility Worker (Detroit, MI)
Age: 47 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 5.0 years
Commonness: 14/20
Statement of Opinion:
- It's a progressive step to recognize utilities in credit scores.
- Not everyone owns a home to benefit from traditional credit-building methods.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 7 | 7 |
Warehouse Worker (Buffalo, NY)
Age: 31 | Gender: male
Wellbeing Before Policy: 3
Duration of Impact: 10.0 years
Commonness: 17/20
Statement of Opinion:
- Having my utility payments reported might finally give me a chance to establish a credit score.
- I can't even get a credit card with no score. This could change things.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 4 | 3 |
| Year 2 | 5 | 3 |
| Year 3 | 6 | 3 |
| Year 5 | 7 | 3 |
| Year 10 | 7 | 3 |
| Year 20 | 6 | 4 |
Nurse (Miami, FL)
Age: 39 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 3.0 years
Commonness: 11/20
Statement of Opinion:
- My credit is stable already. I can't see this policy significantly affecting me.
- It seems more beneficial for people who rent or young adults starting out.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 8 | 8 |
Service Worker (Seattle, WA)
Age: 19 | Gender: female
Wellbeing Before Policy: 4
Duration of Impact: 6.0 years
Commonness: 19/20
Statement of Opinion:
- Reporting rent payments could assist my financial independence and credit building.
- I feel like it would help young people establish themselves financially.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 4 |
| Year 2 | 6 | 4 |
| Year 3 | 6 | 4 |
| Year 5 | 6 | 5 |
| Year 10 | 7 | 5 |
| Year 20 | 7 | 5 |
Accountant (Atlanta, GA)
Age: 50 | Gender: male
Wellbeing Before Policy: 9
Duration of Impact: 0.0 years
Commonness: 9/20
Statement of Opinion:
- The policy is certainly helpful for others but doesn't change much for me with an already robust credit history.
- More inclusive credit reporting could strengthen the financial system overall.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 9 | 9 |
| Year 2 | 9 | 9 |
| Year 3 | 9 | 9 |
| Year 5 | 9 | 9 |
| Year 10 | 8 | 9 |
| Year 20 | 8 | 8 |
Cost Estimates
Year 1: $25000000 (Low: $20000000, High: $30000000)
Year 2: $20000000 (Low: $17500000, High: $25000000)
Year 3: $17500000 (Low: $15000000, High: $20000000)
Year 5: $15000000 (Low: $12500000, High: $18000000)
Year 10: $10000000 (Low: $7000000, High: $13000000)
Year 100: $2000000 (Low: $1000000, High: $5000000)
Key Considerations
- The bill may improve credit access for consumers who are traditionally underrepresented in credit reports, potentially changing their credit standing for better loan and credit opportunities.
- The inclusion of non-traditional data (rent, utilities, telecom) could lead to more accurate risk assessments by lenders, which could reduce overall risk in financial markets.
- Implementation may involve substantial coordination with utility companies, rental agencies, and telecom service providers to ensure accurate and consistent data reporting.
- Long-term savings may arise from a more financially stable consumer base with better credit access.