Mortgage Lenders Can Improve Pull-Through With Rent History

New workflow in the Empower LOS makes it easier for mortgage lenders to consider rent payments when qualifying first-time homebuyers

Dark Matter Technologies announced a new automated workflow in the Empower loan origination system. The workflow helps lenders identify applicants who may benefit from positive rent payment history evaluation.

Developed with Informative Research, the workflow uses Fannie Mae’s Desktop Underwriter positive rent payment history enhancement. It allows lenders to better support first-time homebuyers with a history of consecutive rent payments.

Fannie Mae introduced its positive rent payment history enhancement to help expand access to sustainable homeownership for renters with limited credit histories.

By using 12-month asset verification reports from authorized providers, such as Informative Research’s AccountChek, lenders can allow DU to consider positive rent payment data for certain first-time homebuyers.

According to Fannie Mae, as of Q4 2023, 5,600 mortgage applications benefited from positive rent payment history and were deemed approve-eligible. Forty-one percent of those applicants identified as Black or Latino/Hispanic.

“Using positive rent payment history in credit evaluations is one of several ways Fannie Mae is improving access to affordable homeownership that supports our commitment to our mission and strong credit underwriting standards,” said Peter Skarnulis, Fannie Mae Vice President of Single-Family Digital Management Solutions. “This new workflow makes it more practical for lenders to take advantage of this feature, which can help more first-time homebuyers qualify for a home loan.”

The Empower LOS helps lenders consider positive rent payment history earlier in the loan process through business-friendly configurations instead of code.

• When a loan application is submitted to DU and does not initially receive an approve-eligible recommendation, DU can determine whether rent payment data may help provide a more favorable recommendation.
• If DU recommends reviewing rent payment history, Empower can suggest obtaining a 12-month asset verification report through AccountChek.
• Empower helps route the consumer-permissioned asset data from AccountChek for resubmission to DU at the right point in the process.
• This automation gives more borrowers an additional opportunity to receive loan approval and move forward.

“This is a prime use case of how business process automation can create value not only for lenders but for borrowers as well,” said Rich Gagliano, CEO of Dark Matter Technologies. “Our task-based orchestration engine allows lenders to improve pull-through for borrowers with nontraditional credit references without burdening loan officers or processors.”

“Enhancements to lender workflow that make innovative and equitable solutions practicable are a huge step toward making meaningful change,” said Informative Research SVP of Marketing and Product Craig Leabig. “Our goal is to blend technology with business process and verification products to improve outcomes.”

About Dark Matter Technologies

Operating with the nimble nature of a startup and the disciplined maturity of one of the industry’s leading providers, Dark Matter Technologies delivers technology, automation, and innovation to mortgage lenders and companies nationwide. For more information, visit dmatter.com.