Fannie Mae Introduces New Underwriting Innovations to Responsibly Expand Access to Mortgage Credit

Today, Fannie Mae announced the company will launch a new feature in its automated underwriting system to incorporate consumers’ rent payments in the mortgage credit evaluation process. Beginning September 18, 2021, Fannie Mae’s Desktop Underwriter® (DU®) will enable single-family lenders – with permission from mortgage applicants – to automatically identify recurring rent payments in the applicant’s bank statement data to deliver a more inclusive credit assessment. The new update to DU is a positive change for eligibility – only consistent rent payments will be considered to improve eligibility. Any records of missed or inconsistent rent payments identified in the bank statement data will not negatively affect the applicant’s ability to qualify for a loan sold to Fannie Mae.

Additionally, to support homeownership opportunities for more underserved borrowers, Fannie Mae is updating the credit score used by DU in the eligibility assessment. Though credit scores are not an integral part of DU's risk assessment, DU currently uses credit scores to ensure compliance with the 620 minimum representative credit score requirement. For loan casefiles with more than one borrower, DU will use an average median credit score when determining if a loan casefile meets the minimum credit score requirement of 620. The representative credit score will continue to be used for pricing, any applicable mortgage insurance requirements, and provided in MBS disclosures.

For questions, please contact the Fannie Mae Investor Help Line at 1-800-232-6643, Option 3 or by e-mail.