Fannie Requires Two Credit Reports

Wow! Yet another change in underwriting guidelines.

Fannie Mae announced that effective June 1, they will require a second credit report to be pulled by the lender.

Why is Fannie Mae requiring this? Fannie Mae is requiring this in order to prevent someone from obtaining several loans (from other lenders) simultaneously on the same property. Pulling a second credit report allows lenders to see whether other creditors have recently requested information on the borrower.

What does this means to Borrowers/Buyers? Borrowers may be affected in that during the course of their transaction, they will be strongly encourage not to charge anything on their credit cards and /or open new credit. Doing so may affect their loan approval, which may affect their closing date.

What does this mean to Sellers and Realtors? Should the buyers do any of the above during the course of the transaction, it will affect the contract dates.

To prevent any major changes in loan approval, borrowers are encouraged to reframe from making any major purchases or opening any new loans. By doing so, it will allow a smooth transaction.

Have a great week!