More Renters May Qualify for a Loan After July 10
By Kerry Smith
If renters paid their landlord on time for a year, they can share that info with Freddie Mac to improve their chance for mortgage approval or a lower interest rate.
MCLEAN, Va. – Freddie Mac will consider on-time rent payments as part of their loan-purchase decisions starting on July 10, 2022.
After that date, mortgage lenders that plan to sell loans to Freddie Mac can add an applicant’s rent-payment history automatically through Freddie Mac Loan Product Advisor (LPA), the company’s automated underwriting system.
“This extremely important initiative will help many renters move closer to achieving the dream of homeownership,” says Michael DeVito, CEO of Freddie Mac. “Millions of American adults lack a credit score or have limited credit history. By factoring in a borrower’s responsible rent payment history … we can help make home possible for more qualified renters, particularly in underserved communities.”