Articles Tagged with ''Credit score''

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FHFA on credit score delivery: forgotten lessons

Multiple versions of a credit model may lead to added cost and complexity
Recently, FHFA posted a Request for Input asking for opinions concerning options for changing the delivery of credit scores to the GSEs, underwriters and investors. FHFA is considering various options to change the current system. Any such choice, in the end, is the outcome of a detailed cost-benefit analysis, but while FHFA acknowledges this, they fall short of providing the necessary framework for reaching an informed conclusion.
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Here's where to find some good news for mortgage lenders

Refis down, mortgage profits down, true, but desire to buy homes is still growing
Looking for some good lending news during a downturn? LendingLife has your back. Yes, it is true that rates are rising, per loan profits are down, credit feels tight and refinances are dipping. But, the good news is that the perception of homeownership as a good investment is on the rise. And that's not the only good news for lenders right now.
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Keep credit scores independent and reliable for the mortgage market

What would a credit-bureau controlled credit score look like?
[Expert commentary] Tucked into the U.S. Senate’s recently passed financial regulatory reform bill is a provision that has nothing to do with regulatory relief for community banks, freeing up capital in financial institutions, or enhancing consumer protections. FICO explains what it thinks a credit-bureau generated credit score would mean for mortgage finance.
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MBA calls for competitive credit score requirements

Submits letter to FHFA
On the last day to submit comments about credit scoring to the Federal Housing Finance Agency, the Mortgage Bankers Association sent in a letter calling for more competitive credit score requirements. Here’s some of the requirements the MBA outlines in its letter to the FHFA.
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VantageScore hires former Radian, Wells Fargo exec Phillip Bracken to lead industry relations

Bracken also tasked with dealing with regulators
VantageScore Solutions, the developer of the VantageScore credit scoring model, is hiring former Radian Guaranty and Wells Fargo executive Phillip Bracken to lead the company’s government and mortgage industry relations. Bracken comes to VantageScore from Radian, where he was chief policy officer and head of government and industry relations.
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MI companies creating new standard for over 45% DTI mortgages

More companies prepare to raise standards
More mortgage insurance companies continue to fight against mortgages with debt-to-income ratios of 45% to 50% as they prepare to raise their standards. Last week, HousingWire outlined plans from MGIC and Genworth to increase their standards on high DTI loans, but as it turns out, that was just the tip of the iceberg.
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State of U.S. interest rates, broken down by credit scores

Here are the interest rates for those less-than perfect scores
The last report from Freddie Mac shows the average 30-year fixed-rate mortgage interest rate came in at 3.95%, but what about for borrowers with less-than-perfect credit scores? LendingTree recently conducted a study which analyzed the actual rates lenders offered to borrowers to see the average interest rate broken down by credit scores.
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Watt: Shift away from FICO is among “most complicated” decisions for FHFA

FHFA considering alternative credit scoring but it’s going to take time
Just as he did back in August in a speech before the National Association of Real Estate Brokers’ 70th annual convention in New Orleans, Federal Housing Finance Agency Director Mel Watt told the crowd at the Mortgage Bankers Association Annual meeting in Denver not to hold their breath waiting for Fannie Mae and Freddie Mac to begin using alternative credit scoring models.
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VantageScore: How the FHFA can open the door to alternative credit score models

A transition from the FICO model
Although FHFA Director Mel Watt recently threw cold water on the idea, at some point in the future, the mortgage industry will move to using a credit scoring model other than one built by FICO prior to the recession. A push towards embracing alternative credit scoring models has gained steam in recent years, and as the discussion starts to grow, VantageScore Solutions plans to be right at the forefront of it.
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