The Wall Street Journal's Annamaria Andriotis reports Freddie Mac and two non-bank lenders are loosening income and documentation requirements for mortgage applicants in a new pilot program that was announced on Monday.
The changes, which are designed to help boost mortgage originations among first-time buyers and applicants with lower incomes, come nearly a decade after the start of the mortgage meltdown.
Under the Freddie program, applicants will be able use the income of people who will live with them but aren’t going to be on the mortgage to qualify. In addition, income from second jobs that borrowers have held for a relatively short period will be factored in. The pilot also doesn’t require bank statements that would show a paper trail of how some borrowers save for their down payments.