I can’t tell you how many times I’ve heard the question, “I can afford to pay my rent each month, so why can’t I get qualified for a mortgage?” It’s a valid question, and we finally have a helpful response, and a solution, thanks to Freddie Mac. (Freddie Mac was chartered by Congress in 1970 to keep money flowing to mortgage lenders in support of homeownership and rental housing. Their goal is to provide liquidity, stability, and affordability to the U.S. housing market.)
What’s Their Solution?
During the Arizona Mortgage Expo, I heard rumblings of big changes coming, so naturally, I had to dig in and see what all the ruckus was about. I was happy to learn that Freddie Mac will now consider a twelve-month rental history for individuals that lack credit history, or those with a very limited credit profile. All they are asking for is a twelve-month history of bank statements showing timely payments being made to your landlord. These will be submitted with the rest of the client’s qualifying information when using the Freddie Mac underwriting system. This is a huge win for renters with dreams of owning a home! As we transition into a buyers’ market, folks who previously thought they had no chance at home ownership can now explore getting into a place of their own and can start building equity with each payment rather than renting. There has always been a large sector of individuals, particularly in underserved communities where responsible renters were never given the credit they deserved when it came to the dream of home ownership. This will allow those same individuals to be able to build and grow their credit scores moving forward, and create more opportunities for families nationwide! For more information about how you can leverage your rental history to get qualified for a loan, please don’t hesitate to reach out!Author:
An Equal Housing Lender