Fannie Mae Provides Day 1 Certainty; New Enhancement Further Streamlines Mortgage Origination Process for Lenders and Homebuyers

By klrw460 March 6, 2024

Fannie Mae (FNMA/OTCQB) has announced new enhancements to its Desktop Underwriter® (DU®) automated underwriting system, aimed at simplifying the mortgage origination process for lenders and homebuyers. Starting March 29, 2024, Fannie Mae’s single-family lenders will be able to utilize a 12-month asset verification report within the DU validation service. This report will enable the automatic validation of income, employment, and assets by identifying recurring deposits in applicants’ digital bank statements. Additionally, it will consider applicants’ positive rent payment and cash flow history, potentially benefiting those with limited or no credit history.

Cyndi Danko, Fannie Mae’s Senior Vice President and Single-Family Chief Credit Officer, emphasized the organization’s commitment to modernizing the mortgage finance experience and responsibly broadening homeownership opportunities. The DU update facilitates a more efficient loan application process, offering speed, simplicity, and certainty to both lenders and borrowers.

The enhancement employs data from third-party vendors for validating borrowers’ details. By opting into the DU validation service and using the asset verification reports, lenders may achieve faster closings, potentially lower costs by reducing the need for third-party reports and labor, and gain Day 1 Certainty® for validated information, enhancing loan quality and reducing repurchase risk. This update also aims to improve the homebuyer experience by lessening the documentation required from applicants and could enable more individuals to receive an Approve/Eligible recommendation through an automated cash flow assessment and the acknowledgment of positive rent payments.

Fannie Mae has introduced several other innovations to support homeownership readiness and accessibility. These include an enhanced pre-qualification process through the DU early assessment, an automated income calculator for self-employed homebuyers, a down payment assistance tool, and the award-winning HomeView® and HomeView en Español for consumer education on financial literacy and homeownership. Lenders are encouraged to reach out to their Fannie Mae representatives to explore these enhanced DU capabilities and other available resources.

For the full details and insights, please refer to the original press release at the following link: https://www.fanniemae.com/newsroom/fannie-mae-news/fannie-mae-provides-day-1-certainty-new-enhancement-further-streamlines-mortgage-origination-process