Fannie Mae plans to launch a new underwriting innovation beginning September 18, 2021 that will automatically incorporate rental history into their credit evaluation system. Using bank statement data, mortgage lenders will be able to “deliver a more inclusive credit assessment” with the borrower’s permission, according to the press release.
Hugh R. Frater, Fannie Mae CEO, said, “Many renters believe they will never be able to buy their own home because of insufficient credit. We can responsibly expand mortgage eligibility by including positive rent payment history in underwriting risk assessments. We believe this will be the first time any large-scale automated mortgage underwiring system will leverage electronic bank statement data to consider positive rent payment history. It is but one important step in correcting the housing inequalities of the past, creating a more inclusive mortgage credit evaluation process going forward, and encouraging the housing system to develop new ways of safely assessing and determining mortgage eligibility in order to fairly serve all potential homeowners. We look forward to working with our industry partners to do what we can together to address this and other barriers of homeownership.”
This novel system will even the playing field for homeowners. It should lead to more mortgage approvals for those who might not have otherwise qualified for a home loan because of insufficient credit history.
If the borrower has a limited traditional credit history or was denied previously, the new change could be beneficial for them. Positive rental payments will be automatically notated from tendered bank statements and incorporated into the underwriting program.
To learn more about this new program and apply for a mortgage, contact the professionals at EB Mortgage today.
EB Mortgage is a locally-owned mortgage company with experts in new home purchase, refinancing, and commercial loans. Our wholesale rates can’t be beaten. We offer more products, more options, and more solutions. Our “3C” Process is simple: complete our pre-approval request, consider options based on your requirements, and choose the offer that suits your needs best. Call us at 866-246-0516 or e-mail contact@ebwmtg.com today.
Written by the digital marketing staff at Creative Programs & Systems: www.cpsmi.com.