Once upon a time, loans were made on a handshake. That’s not just a platitude; before the Civil War, most Americans were self-employed, there was no federal income tax and banking was decentralized, making it practically impossible to verify a borrower’s employment, income and assets.
As the American financial system grew more sophisticated, so did our ability to document an individual’s financial history and capacity — but it still wasn’t possible for a creditor to access and review this information in real time.
Read the full article by Brent Chandler in HousingWire.