"Expanding the set of acceptable credit scoring models to include VantageScore 4.0 and FICO 10T will help foster a more transparent and dynamic market, broaden access to sustainable credit, and put downward pressure on costs for GSE and FHA borrowers."
"The move introduces much-needed competition into a critical segment of the mortgage process, adding that a more competitive landscape could lead to a more transparent and cost-effective mortgage experience for consumers."
The FHA intends to adopt updated credit scoring models to enhance access to credit without compromising underwriting standards. A new pricing grid is being developed, potentially lowering credit score costs. The updated models may better reflect borrower behavior, such as timely rent payments. Industry professionals view this as a positive change, promoting competition and transparency in the mortgage process. The Mortgage Bankers Association supports the initiative but emphasizes the need for coordination among stakeholders for effective implementation.
Read at www.housingwire.com
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