A key member of the House Financial Services Committee raised concerns with the Federal Housing Finance Agency’s plan to change credit report requirements for Fannie Mae and Freddie Mac mortgages.
Letter to FHFA: Rep. Blaine Luetkemeyer (R-Mo.), chairman of the panel’s national security subcommittee, took issue with the FHFA’s plan to transition from requiring three credit reports (tri-merge) to requiring two credit reports (bi-merge) for single-family loan acquisitions. In a letter to the FHFA, Luetkemeyer said the proposal, which also would replace the Classic FICO credit score model with FICO 10T and VantageScore 4.0, risks unnecessary exposures to the enterprises’ balance sheets.
FHFA Timeline: The FHFA in August said it is considering adjustments to its transition plan following outreach from ICBA and other groups representing the mortgage industry. In a letter to the organizations, the agency said it is considering adjustments to the proposed timeline, understands the need for data to support stakeholder analysis of the impacts of the new credit score models, and is developing several mechanisms to ensure robust stakeholder engagement.
Industry Concerns: In a previous letter, the groups:
Expressed concerns with the FHFA plan to replace the Classic FICO credit score model with FICO 10T and VantageScore 4.0.
Said the implementation timeline and plan lack data and transparency and fail to address the far-reaching effects of the proposed policy changes.
Called for stakeholder engagement, robust data transparency, and a recalibrated timeline.