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Fannie Mae and Freddie Mac - Credit History Requirements

Posted on: 27th Nov, 2008 09:28 pm
Hi,

I would like to know what are exact requirements for Fannie Mae and Freddie Mac requirements for Credit History section.

I have been through the effanniemae and freddiemac website, but the documentation is too huge, also recently fannie mae updated their foreclosure requirements if the loan qualifies for manually underwriting.

I want to know is that what are the exact BK / FC / MH / RO / IN / RE requirements for Fannie and Freddie if a loan recieves appropriate responses, do the credit policies change as per the response ??

Because Fannie recently upgraded the FC Requirements deals only if a loan qualifies for manually underwriting, so want to know for other responses.

Please guide me.
hi sagarthakar,

as far as i know, fannie mae will require a minimum credit score of 580 for most loans. fannie mae has also decided to lengthen the period needed for borrowers to re-establish their credit history after a foreclosure to 5 years from 4 years. in case of chapter 7 bankruptcy, fannie mae is now requiring a 4 year waiting period and in case of chapter 13 bankruptcy, it requires a 2 year waiting period after the discharge. in case of manufactured homes, fannie mae has announced that it will once again buy 30-year loans with a 5 percent down on factory-built houses. as far as mortgage refinancing is concerned, one can try out the cash-out refinancing. moreover, when one refinances the mortgage, the interest rates are lowered.

fannie mae and freddie mac both have come up with new loan products and flexible underwriting standards for manufactured homes. this has helped a lot of people to buy mobile homes. apart from this, as far as i know, the credit requirements for fannie mae and freddie mac are similar.

thanks,

jerry
Posted on: 28th Nov, 2008 01:31 am
Thanks Jerry,

If you check the 25-6 Announcement for Fannie it mentions that for Manually Underwritten Loans the Foreclosure has changed to 60 Months, rest bankruptcy clause is all same.

But if you check out the AllRegs.com site for FNMA Seller and Servicing Guide in the Credit Underwriting section Fannie Mae has still mentioned that for Foreclosure the period is 48 Months and Bankruptcy is still the same.

So I am confused that according to the new announcement is Fannie applying the new FORECLOSURE requirement of 60 Months for all types of responses or only for those files where Manual Underwriting is needed.

(Note - As we all are aware that if a file receives Refer , Out of Scope response then it has to be manually underwritten.)

Are the credit requirements different with respect to the responses ????

Please advice.

Thanks
Posted on: 29th Nov, 2008 07:15 am
I believe FC is now 60 months.
I would checkout FHA which is still 36months from discharge
Posted on: 29th Nov, 2008 12:00 pm
Please can you also verify once again that FC 60Mnths is it only for manually underwritten loans or for any response from DU.

Also if its possible for you can you attach a detailed Credit History requirement for both FNMA and FHLMC.

Thank You for your reply

Sagar
Posted on: 29th Nov, 2008 07:30 pm
I think you should follow what the Fannie Mae website states - for Manually Underwritten Loans the Foreclosure has changed to 60 Months and rest of the Bankruptcy clauses are all the same.
Posted on: 01st Dec, 2008 01:27 am
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