ILLINOIS HOME LOANS

580 Minimum Credit Score on Fannie Govies

Beginning with mortgage loans dated on or after March 1, 2009 or sooner FNMA minimum score for all mortgage loans delivered to them will need to be 580- FNMA Announcement 08-08.

This release 08-08 was primarily pertaining to conventional mortgages but is now expanded to mortgages insured or guaranteed by a federal government agency: HUD, FHA, VA, and RD mortgage loans.

Manually underwritten loans with nontraditional credit are currently exempt from this policy. Manual UW exemption applies to both conventional and government mortgage loans including certain types of streamlined refinance transactions.

Some lenders have already implemented minimum credit score requirements ranging from 575 to 620. The last date to implement this requirement for mortgages sold to FNMA is March 1 but I expect to see most lenders start implementing this minimum much sooner. This is a Fannie Mae requirement and I'm waiting to see a similar change with Freddie Mac. 

If you are a home buyer that has been turned down by your bank, please call me for a birdseye view of other lender policies on this matter.

Please keep in mind that you are also able to increase your credit score through our in-house credit repair service.

Gil [Reply]

Can we still do loans below 580?