Version 10.0 of Fannie Mae’s Desktop Underwriter (DU), with support for trended credit data, is now out of its wrapper.
The inclusion of support for trended credit data means lenders can now use a borrower’s payment history for other consumer credit products – such as credit cards – to determine his or her creditworthiness for mortgage loans. This will be particularly helpful to those lenders wishing to target self-employed or seasonal workers, who often lack the needed documentation to get approved for a mortgage.
Fannie Mae’s use of trended credit data will be the first widespread use in the mortgage industry, the firm says in a release.
“Desktop Underwriter transformed the industry when it was introduced over 20 years ago,” said Marianne Sullivan, senior vice president of single-family business capabilities for Fannie Mae, in a release. “Today’s DU 10.0 enhancements highlight the continued investments and improvements we’re making in our technology to be better partners for our customers and to provide access to mortgage credit for creditworthy borrowers. We continue to listen to our customers and make improvements to DU that take into account how our lenders tell us they want to work and to help them better serve today’s market.”
New capabilities in version 10.0 will allow mortgage lenders to consider the monthly payment amounts that a consumer has made on revolving accounts, such as credit cards, over the previous two years.
In addition, it will give lenders more insight into how a borrower tends to pay off his or her revolving credit lines each month, providing a more comprehensive risk assessment.
Importantly, these changes will allow lenders to go after the “underserved” market – but do it in an efficient way, as all of this fancy detailed underwriting can be automated.
As built, the system requires verification of at least two non-traditional credit sources, one of which must be housing-related.
DU 10.0 also includes automated underwriting for borrowers with multiple financed properties. It provides lenders with a simplified multiple financed properties policy.
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