On-time rent payments added to Freddie underwriting criteria

Jul 15, 2022

On-time rent payments will now be taken into account in Freddie Mac’s underwriting process, the company revealed on Wednesday. The government-sponsored company claimed that its goal is to encourage “responsible” renters to buy a property.

Starting on July 10, this option will enable mortgage lenders to send information from a borrower’s bank account that demonstrates a 12-month run of on-time rent payments to Freddie’s automated underwriting system.

The lack of a credit score or a short credit history has prevented millions of potential borrowers from becoming homeowners, according to Michael DeVito, CEO of Freddie Mac.

“By factoring in a borrower’s responsible rent payment history into our automated underwriting system, we can help make home possible for qualified renters, particularly in underserved communities,” DeVito said.

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