Government-sponsored enterprise (GSE) Fannie Mae has pushed back the release date for the next version of its Desktop Underwriter (DU) automated underwriting system to Sept. 24.
Version 10.0 – which is to incorporate trended credit data that will supposedly open up the credit box to self-employed and so-called “thin file” borrowers – was supposed to be released on June 26, but on Tuesday, the GSE released a memo stating that the release date had to be pushed back to Sept. 24.
It is unclear whether the delay has anything to do with incorporation of trended credit data.
“We are focused on delivering the best technology solutions that provide certainty and stability for our customers, ” company officials say in a statement. “Our release date ensures that all of our customers have the time they need to fully test and transition to the new DU version 10.0. We remain unwavering in our commitment to earn our customers’ business every day and look forward to bringing them the industry-leading capabilities of the enhanced DU, such as use of trended data in credit risk assessment and automated underwriting for borrowers with no traditional credit to expand access to mortgage financing.”
Using trended credit data means DU will go beyond just using credit reports to underwrite loans. Today’s credit report data for mortgages includes only the outstanding balance, utilization and availability of credit, and if a borrower has been on time or delinquent on existing credit accounts, such as credit cards, mortgages or student loans.
With trended credit data, lenders and Fannie Mae will be able to use a different kind of credit risk assessment, which is based on historical monthly data, including balance, scheduled payment and the actual payment amount that a borrower has made on an account.
“Leveraging trended data in the DU risk assessment allows a smarter, more thorough analysis of the borrower’s credit history,” company officials say. “The use of trended data is a powerful predictor of risk, and its use enhances the DU risk assessment to better support access to credit for creditworthy borrowers.”