Lawmakers Urge FHFA to Eliminate FICO Requirement in Seller/Servicer Guidelines

January 17, 2014
BankCreditNews.com 
mortgage lending news
The Federal Housing Finance Agency is under pressure from legislators to strike a requirement from Fannie Mae and Freddie Mac's seller/servicer guidelines that underwriting be performed with a FICO credit score.

A letter to the regulator from Reps. Spencer Bachus (R-Ala.), Jim Himes (D-Conn.), Carolyn Maloney (D-N.Y.), and Ed Royce (R-Calif.) said the rule blocks other credit score providers from the mortgage market, which will become an even bigger issue under the new qualified mortgage (QM) and qualified residential mortgage (QRM) standards. Refusing to consider scores from other competitors in the field, the lawmakers wrote in the letter dated Jan. 9, "risks harming consumers by stifling innovation, increasing prices and reducing the predictiveness of credit scores."









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