WASHINGTON—The Federal Housing Finance Administration (FHFA) is being encouraged to continue to work towards finding the right balance between safety and soundness and credit availability for consumers.
CUNA made the request of the agency in a letter in response to FHFA’s request for information on Fannie Mae and Freddie Mac credit score requirements.
Specifically, the FHFA is seeking feedback about the operational and competition considerations of changing Fannie and Freddie’s current credit score requirements.
“CUNA believes FHFA should continue to work with lenders, including credit unions, to improve and promote the housing market. Having a housing finance market that provides liquidity throughout the country requires strong participation by a wide range of lenders, including small lenders and lenders serving rural areas,” CUNA’s letter reads. “Qualified financial institutions and creditworthy eligible borrowers should have fair and equitable access to the financial services offered by Fannie Mae and Freddie Mac.
With regard to the FHFA’s inquiry into credit score requirements, CUNA stressed the importance of an approach that minimizes prescriptive requirements and maximize flexibility for lenders credit unions and other lenders.
The credit scores being evaluated by FHFA, Fannie and Freddie are:
- Classic FICO;
- FICO 9; and
- VantageScore 3.0.
Fannie and Freddie currently use Classic FICO for product eligibility, loan pricing, and financial disclosure purposes.