Archive for the ‘Credit Scores’ Category

Fannie Mae Offers First-Time Home Buyers Big Help With Closing Costs

This 5 bedroom, 3-bath house qualifies for 3% closing cost from Fannie Mae

 

Kennesaw’s Ashford Capital Partners’ Managing Partners Matt Riedemann brings you news you can use.

If you’re a first-time home buyer just entering the market, you’re in for a springtime treat: Fannie Mae will now pay your closing costs, up to 3% of the price of the home—provided you take the mortgage giant’s home-buyer counseling course first.

The new HomePath Ready Buyer program, announced on Wednesday, allows first-time buyers (defined as those who have not owned a home in the past three years) to take an online course, get certified, and become eligible for what could amount to significant savings. For instance, on a $150,000 home, Fannie Mae could contribute up to $4,500 toward your closing costs—which typically range from 2.5% to 3% of a home’s price—and even reimburse you for the $75 online course.

“This could actually get someone in the game,” said Frank Montro, a Chicago-area real estate broker who specializes in selling rehabbed homes. “This goes straight to the buyer’s needs.”

Montro says first-time home buyers are usually either “cash-poor or credit-poor. They pay their bills on time and they qualify for the mortgage, but they just don’t have the savings.”

By offering closing cost assistance on their properties, Fannie Mae is opening the gates to a pool of people who have largely been left behind in the housing market recovery. Traditionally, first-time buyers have made up about 40% of the market. Last year, they accounted for 33%, according to the National Association of Realtors®.

While this announcement marks the mortgage giant’s latest step in loosening credit availability—it also announced a new 3% down loan program in December—it does so with some strings attached. The closing cost credit applies only to properties in Fannie Mae’s own inventory.

Fannie Mae owns thousands of houses across the country, all seized in foreclosure proceedings, and now the government-backed private corporation is actively trying to unload that inventory. Searching our own site’s listings, we found 7,075 single-family homes listed as Fannie Mae HomePath properties.

April 17th, 2015 – Chrystal Caruthers – http://www.realtor.com/news/fannie-mae-first-time-home-buyer-closing-costs-help/

Kennesaw’s Ashford Capital Partners’ Managing Partners Matt Riedemann brings you news you can use.  Check back tomorrow for more.

FICO announces new credit program for risky borrowers

Kennesaw’s Ashford Capital Partners’ Managing Partners Matt Riedemann brings you news you can use.

FICO (FICO), LexisNexis Risk Solutions and Equifax (EFX) released the official details to the new pilot program that was first reported on Wednesday, potentially opening the door to help millions of borrowers secure financing for a home.

The three firms are working together to create a pilot program that will allow 12 of the largest credit card issuers in the U.S. to use alternative data to identify creditworthy individuals who would otherwise be unlikely to obtain traditional credit.

After the pilot program is complete in the coming months, FICO expects to make the score based on alternative credit data available to more lenders later this year.

FICO’s data scientists found that alternative data such as property records, telecommunications and utility information can reliably be used to score 15 million consumers who do not have enough credit data to generate FICO scores.

By using alternative data from LexisNexis and Equifax, FICO will give card issuers a FICO Score that complies with relevant regulations that they can use to extend credit responsibly to millions of additional people.

Card issuers will be able to use the alternative score without having to “rip and replace” existing systems, significantly lowering the cost and accelerating time to market.

“Working with Equifax and LexisNexis, we set out to help unbanked, under-banked and disadvantaged people gain equal access to the standard credit products enjoyed by millions of Americans,” said Jim Wehmann, FICO’s executive vice president for Scores.

“We’re excited by our pilot program’s strong results thus far. FICO’s focus is on expanding access to credit; not simply scoring more people. Our approach also addresses a paradox for people seeking their first traditional credit product – you often need a credit history before you can get traditional credit,” added Wehmann.

This falls in lines with recent talks from housing regulators on finding alternatives to traditional credit scoring.

Several real estate trade groups spent Wednesday discussing the challenges that credit standards pose for access for some would-be borrowers and alternatives to traditional credit scoring.

The event, co-hosted by the National Association of Realtors, the Asian Real Estate Association of America and the National Association of Hispanic Real Estate Professionals, included two roundtable discussions and a keynote address from Secretary of Housing and Urban Development Julian Castro.

Come back tomorrow to http://www.AshfordCP.com/blog  where Kennesaw’s Ashford Capital Partners’ Managing Partners Matt Riedemann brings you news you can use.

Author: Brenda Swanson – http://www.housingwire.com/articles/33445-its-official-fico-announces-new-credit-program-for-risky-borrowers

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