Federal Reserve: FEDS Notes | Are Income and Credit Scores Highly Correlated?
Are Income and Credit Scores Highly Correlated? Rachael Beer, Felicia Ionescu, and Geng Li1 1. Introduction Credit scores, a numerical indicator constructed to predict borrowers’ credit risk, represent a crucial element of a person’s financial life and are used extensively in loan underwriting and pricing. On average, consumers with higher credit scores tend to have…