Freddie Mac currently allows lenders to manually underwrite mortgage loans to borrowers without credit scores. By allowing automated assessments, lenders can serve more potential homebuyers more efficiently and with greater certainty that the loan will be purchased by Freddie Mac.
"We're committed to supporting responsible lending and improving access to credit for all borrowers, including first-time home buyers, low- and moderate-income buyers and underserved populations," said David Lowman, executive vice president of Freddie Mac's Single-Family Business. "It's important that we keep pace with the evolving needs of the U.S. market and help support sustainable homeownership."
Beginning in June, borrowers without credit scores may be eligible for purchase mortgages or no-cash-out refinance transactions on one-unit owner-occupied homes.
Loans will be reviewed by Loan Product Advisor, which evaluates them based on Freddie Mac's credit requirements and provides feedback on the credit risk of each loan. It's the cornerstone of Loan Advisor Suite, Freddie Mac's smart end-to-end technology solution that gives customers certainty, usability, reliability and efficiency.
"By allowing lenders to more easily assess their overall underwriting risk, we encourage them to take advantage of our entire credit box to originate more loans in a safe and secure manner," Lowman noted.
For more information, visit the Freddie Mac Loan Advisor Suite page.
Freddie Mac makes home possible for millions of families and individuals by providing mortgage capital to lenders. Since our creation by Congress in 1970, we've made housing more accessible and affordable for homebuyers and renters in communities nationwide. We are building a better housing finance system for homebuyers, renters, lenders and taxpayers. Learn more at FreddieMac.com, Twitter @FreddieMac and Freddie Mac's blog.