What do counselors first consider when evaluating alternative credit?

When evaluating alternative credit, counselors primarily consider utilities as they provide a clear indication of a consumer's payment history and reliability. Utility payments are often seen as essential bills that reflect a borrower's regular financial behavior. The consistent management and payment of utility bills can demonstrate a borrower’s creditworthiness, even if they lack traditional credit history.

This assessment is important because it helps in understanding the borrower's capability to handle monthly expenses and indicates their level of responsibility in managing financial commitments. While options like rent, national accounts, and mortgage payments hold significance in a borrower's overall financial profile, utilities serve as a foundational element that many lenders look at first due to their monthly recurrence and critical nature in most consumers’ lives. This makes them a vital aspect of evaluating alternative credit, especially for individuals who may not have established credit through traditional means.