Fannie Mae is simplifying the lending process for lenders and borrowers with a series of updates to its mortgage offerings.

One of the biggest changes is that beginning in mid-2016, Fannie Mae will require lenders to use trended credit data when underwriting single-family borrowers through Desktop Underwriter. Fannie is working with Equifax and TransUnion to provide the data.

As it stands, credit reports used in mortgage lending only indicate the outstanding balance and if a borrower has been on time or delinquent on existing credit accounts such as credit cards, mortgages or student loans.  

Through trended credit data, lenders can access the monthly payment amounts that a consumer has made on these accounts over time. 

“With these two dramatic steps, Fannie Mae is helping to make the home mortgage market smarter, safer, and open to more consumers,” said Craig Crabtree, general manager of Equifax Mortgage Services. “Increasing the use of trended data will help improve the evaluation of risk and reward the responsible use of credit, while incorporating Equifax verification services will help streamline the underwriting process.”

Equifax explained that trended data expands the credit information used for evaluating a home loan applicant, adding a more dynamic two-year picture of the applicant’s history managing revolving accounts.

“For some consumers who don’t have a large amount of available credit, but pay their balances every month, trended data may potentially improve their ability to obtain a mortgage by providing lenders with a more complete picture of their credit behavior over time,” Crabtree said.

TransUnion added that after a recent analysis, it found that the use of trended data can potentially impact vast numbers of consumers in the housing market through better pricing and access to mortgage loans. 

TransUnion research indicates that the percentage of consumers in the Super Prime risk tier, who generally have the greatest access to new loans at the lowest pricing, would increase from 12% of the population to nearly 21%.

“Fannie Mae wants to be the partner of choice for lenders. Our aim is to help lenders serve their customers efficiently so that more qualified borrowers have access to mortgage credit,” said Timothy Mayopoulos, president and CEO of Fannie Mae.

“We are enhancing our offerings, improving our tools and innovating through the technology we provide to our customers. Our goal is to make sustainable homeownership a reality in communities across the country while reducing risk for taxpayers,” he added.

Click the next page for the other three new mortgage initiatives from Fannie.