Using Cable or Even Netflix to Qualify for a Loan?

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If prospective home buyers don’t have a long credit report, mortgage lenders may be skeptical about their ability and willingness to repay their debt. But those with a thin credit profile may still be able to show their worth the risk by showing off their nontraditional credit. 

Credit.com recently said this can be shown in a number of ways from a P.O. box, a book club membership, to even a Netflix account. 

Lenders aren’t only looking at your credit score but also they like to see a certain number of “trade lines” or credit accounts (such as car loans and credit cards). Strong credit profiles usually consist of old trade lines that are still active — such as student loans or a mortgage — and revolving accounts, such as credit cards. Lenders typically like to see around three trade lines with at least a yearlong history in an applicants’ credit profile. 

For borrowers who come up short on credit accounts, nontraditional trade lines may help support their case, although not all lenders will accept alternative credit accounts. 

In a recent article, Credit.com highlighted some alternative trade lines that can be used for those borrowers who may need to show more in their credit profile. Such alternative trade lines may include: 

  • A storage unit
  • Cable or cellphone bill
  • Auto or renters insurance
  • Utilities paid (separate from monthly rent)

Source: “How Netflix Account Can Help You Qualify for a Mortgage,” Credit.com (Aug. 27, 2013)

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