SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Strategies & Market Trends : Mish's Global Economic Trend Analysis
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: koan who wrote (79822)6/6/2008 8:53:44 AM
From: Think4Yourself  Read Replies (1) of 116555
 
New underwriting software/rules went into effect at Fannie effective June 1. MUCH stricter lending standards to get a conforming loan now. There will be lots of fallout from this in the coming months.

Message 24652804

...
Borrowers and lenders complained that the policy was scuttling deals. In May, Fannie Mae announced that it would rescind the rule June 1. That happened to be the same date Fannie rolled out the newest version of its loan decision-making software, Desktop Underwriter. It wasn't a coincidence. A Fannie spokeswoman explained that the company could ditch the declining-market policy because the new loan software "will limit risk layering and assess each loan more precisely."

And what does that mean? Stephen Swad, Fannie's chief financial officer, told analysts in May that, "We have significantly tightened underwriting and eligibility standards." In a memo, Fannie told lenders to expect the new software to reduce approval rates.

Because of Fannie's stricter standards, conforming lenders will require credit scores of at least 580. Borrowers won't be able to boost their scores by being listed as "authorized users" of credit cards owned by other people. Anyone who has been 60 days late on a mortgage payment in the last 12 months will be turned down; ditto for anyone who went through foreclosure within the last five years. And the new guidelines cast a wary eye on anyone who is buying a condominium or wants to do a cash-out refinance.
...
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2026 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News