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Earnest is a new small-scale lending company with an unconventional approach to risk assessment.
Rather than focus only on standard measures, such as borrowers’ credit scores and existing debt, Earnest also considers spending and saving habits and income potential, based on such factors as where borrowers went to college and what degrees they earned. The company has been using Boston as a test market and will have its official launch on Monday.
Earnest is even willing to issue loans for reasons that might raise eyebrows at other lenders, such as vacations and gifts. One borrower who participated in the company’s test, along with Pollara, is planning to propose to his girlfriend and used the money to buy an engagement ring.