2022-10-17 | OTCQB: FMCC | Press release
Industry-first capability will also help lenders qualify more entry-level and underserved borrowers
MCLEAN, Va., Oct. 17, 2022 (GLOBE NEWSWIRE) — Freddie Mac (OTCQB: FMCC) will increase homeownership opportunities by including a review of a borrower’s bank account data to identify a history of positive monthly cash flow activity as part of homeownership eligibility assessments. loan purchase of its technology, the company announced today. This industry-first innovation will be available to mortgage lenders nationwide through Freddie Mac’s automated underwriting system. Loan Product Advisor® (PLASM), starting November 6, 2022.
“With the addition of positive monthly cash flow data, our underwriting system can help more accurately predict a borrower’s ability to repay their mortgage because it uses a comprehensive view of managing finances. over time,” said Terri Merlino, Senior Vice President and Chief Credit Officer of Freddie Mac Single-Family. “Our latest innovation is leveling the playing field and helping to make homes more accessible to borrowers whose lenders don’t them might not have qualified with traditional underwriting methods. This should especially help first-time home buyers and underserved communities.”
With the borrower’s permission, lenders and brokers can submit financial account data for LPA to identify 12 or more months of cash activity for inclusion in the tool’s risk assessment. Data can be obtained from checking, savings, and investment accounts, including those used for direct deposit of income and monthly bill payments, such as rent, utilities, and auto loans. Account data submitted can only positively affect the borrower’s credit risk assessment. To help identify opportunities, LPA will notify lenders when additional account data could benefit a borrower.
Lenders and brokers can obtain financial account data from designated third-party service providers using the same automated process they currently use to verify assets, income (using direct deposit), useand on-time rent payments via a single report via LPA’s asset and income modeler (OBJECTIVE).
Together with our industry partners, we have made significant progress toward modernizing the mortgage origination process,” said Kevin Kauffman, vice president of customer engagement for Freddie Mac Single-Family. “In today’s market, our latest industry-leading innovation provides lenders with efficiencies that can drive cost savings and improvements to the borrower experience, while meeting strict credit underwriting standards. by Freddie Mac.”
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About Freddie Mac
Freddie Mac makes home possible for millions of families and individuals by providing mortgage capital to lenders. Since our founding by Congress in 1970, we have made housing more accessible and affordable for buyers and renters in communities nationwide. We are building a better housing finance system for buyers, renters, lenders, investors and ratepayers. Learn more about FreddieMac.comTwitter @FreddieMac and Freddie Mac’s blog FreddieMac.com/blog.
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