Fannie Mae just announced, “lenders to factor in an applicant’s rental payment history as part of the mortgage underwriting process for the first time.” This is great news for first time buyer’s who have been consistent in their rent checks.
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The Federal Housing Finance Agency recently announced this change, hoping it would open options to those with lower credit score. Historically, lifetime renters’s credit reports were not high because their on time payments would not be reported by landlords, preventing any positive building from on time bills.
“Rent is the single largest monthly expense.” says Sandra L. Thompson, acting director of the FHFA, who hopes that this announcement will help renters boost their credit score and allow more aspiring home owners to find their future homes. “There is absolutely no reason timely payment of monthly housing expenses shouldn’t be included in underwriting calculations,” she said. “With this update, Fannie Mae is taking another step toward understanding how rental payments can more broadly be included in a credit assessment, providing an additional opportunity for renters to achieve the dream of sustainable homeownership.”
This update will be effective starting September 18. The rent data will be confirmed through a verification technology firm to get rent payment records confirmed for the last 12 months.
Are you a longterm renter finally ready to begin your job search because of this new credit score news? We can help you start anytime, anywhere!