Editor’s note: In this four-part series, we highlight four of the finalists for the 2005 Inman Innovator Award and profile their contributions to the real estate industry. This year, 66 real estate, technology and media firms have made it to the final nomination round and will compete for the coveted awards.

Editor’s note: In this four-part series, we highlight four of the finalists for the 2005 Inman Innovator Award and profile their contributions to the real estate industry. This year, 66 real estate, technology and media firms have made it to the final nomination round and will compete for the coveted awards. (See Part 1: Give us this day our daily leads; Part 2: OnBoard LLC founders make sense of real estate data; and Part 3: Search real estate and ye shall find ‘WhereToLive’)

Maryland mortgage broker Carl Delmont hates having to disappoint a client. So when he heard about CreditXpert, which can help applicants get better interest rates or loans they might not otherwise get, he decided to try it. Nearly seven months later, he’s glad he did.

Delmont, who founded Hunt Valley, Md.-based Freedmont Mortgage in 1993, said he has used CreditXpert for 400 to 500 clients since he first began using the tool in December 2004. The tool has helped many of them get a better deal, he said.

“Say an attorney sends a client to me and I give the client a 5.25 percent mortgage interest rate, well, big deal. That’s what I’m supposed to do. But if I show him that he had a low score and I was able to bring it up and get a lower rate, that makes a big impression.

“We’ve always branded ourselves more as experts than our competitors,” Delmont said. “This is the best arrow in our quiver.”

Sometimes the software can identify a problem with a quick fix that can take as little as a few days, he said. Often, a consumer must take action and wait for his or her to score to come up over a few months’ time.

Delmont can use CreditXpert to show clients how to improve their score by setting problems straight – such as wiping out credit card debt – or by changing credit habits long-term. He also can show them how much their score would increase if a certain problem was eliminated, or he can find inaccuracies in a report using CreditXpert Detective, which launched in February.

This tool scans an individual’s credit data to reveal potential inaccuracies and recommend specific updates that will most significantly improve the person’s credit score. It also automatically generates customized instructions and dispute letters for fixing the problem.

The product enables loan officers to check applicants’ credit to see if any errors or omissions are holding down the credit score, said David Chung, interim president and vice president of business development.

Another product, the CreditXpert Simulator, shows brokers and their clients how much the applicant’s credit score would go up if certain problems were removed.

“We had a Realtor who had a small collection against her,” Delmont said, meaning that a debt the Realtor owed had been referred to a collection agency. “We ran the CreditXpert simulator, taking the collection off, which showed us how much her score would go up without that problem.

“She proved the debt wasn’t hers, and a week later her score went up above 680 and she was able to purchase an investment property she wanted,” Delmont said.

The grateful Realtor has since referred 11 clients to Freedmont Mortgage, Delmont said.

“Our referral business has increased since we began using CreditXpert,” Delmont said. “It’s helped us to generate business with referral sources, whether it’s financial planners, real estate agents or attorneys.” Delmont couldn’t give a dollar figure as to the amount of increased income.

Chung came up with the idea for CreditXpert when he realized how mysterious the credit scoring process is to most consumers. He was working at a company doing custom modeling and consulting for financial services companies, building different scoring models.

“We were consulting with major lenders to help them make better lending decisions. We realized the borrowing community wasn’t aware of any of this. It was all shrouded in secrecy,” Chung said. “Friends and family would ask us questions and we would give them guidance when they were applying for loans.” Chung realized this would be helpful to others as well.

Because people often don’t know how to establish a good credit rating, it’s harder for them to do so, Chung pointed out.

A recent study by GMAC Mortgage revealed that U.S. consumers lack important information about credit scores. Some 62 percent don’t realize that a score above 620 out of 850 is necessary to secure the most favorable mortgage rate, for example. And only 42 percent knew that payment history was a critical determinant to a credit score.

“If you let the consumer know what proper behavior is, they are more likely to do that, especially if it ties into better rates and saving money,” Chung said.

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Send tips or a Letter to the Editor to janis@inman.com or call (510) 658-9252, ext. 140.

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