Borrowers without credit scores may soon qualify for a Fannie Mae loan, giving them an array of new options, reports The Orange County (Calif.) Register contributing columnist Jeff Lazerson.
The government-sponsored enterprise will roll out a new system in June. That's good news for people who haven't built up enough credit to get a credit score. Lazerson writes:
You are eligible for purchase as well for a no cash-out refinance loan if the lender can gather at least two pieces of credit information that covers the last 12 months. One must be a verification of rent. The other can be anything from a utility bill to on-time payments to your local gym.
You must put a minimum of 10% down (or have 10% equity when refinancing), all of which can be a gift. It has to be a single unit primary residence and, for Orange County, your loan amount cannot exceed $417,000.
Read the article to get more details.