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New Trended Credit Data May Help You Get a Mortgage


As a borrower, any advantage you can get in the loan approval process can be helpful in getting the best loan. Soon, you’ll have one more advantage: Fannie Mae’s introduction of trending credit data.

What is trended credit? Currently, the revolving credit section of a credit report simply shows if a payment was made on-time or if a payment was made late. With trended credit data, however, credit reports will also show balances, scheduled payments amounts and actual payment amounts going back 30 months. Trended credit data will be important because it will reflect how a borrower specifically manages spending and debt—something that current credit report data doesn’t show.

How will it be used? Since trended credit data will allow lenders to see specific amounts, they will be able to get a better idea of a borrower’s level of creditworthiness. For example, if a borrower pays only the minimum amount on a credit card each month, that may be a sign that the borrower is more of a credit risk. On the other hand, if a borrower pays off the full balance—or at least pays more than the minimum—each month, that may indicate that the borrower is less of a credit risk.

Can it help me get a mortgage? Although every situation will certainly be different, if you’re making more than just the minimum payments on your revolving credit accounts, the use of trended credit data may be helpful in securing a loan or getting a better loan. According to Fannie Mae, trended credit data should “provide more creditworthy borrowers access to mortgage credit” and will “benefit borrowers who regularly pay off revolving debt.” It will also be helpful to those borrowers who are borderline applicants, those who have non-standard credit histories and those who don’t have enough credit history to generate an accurate credit score.

When will it be implemented? Fannie Mae had originally scheduled the release date for this past June, but it has been pushed back until September 24th. While each of the three credit bureaus—Equifax, TransUnion and Experian—do currently offer trended credit data in some form, only Equifax and TransUnion will be required by Fannie Mae to begin supplying the data in September. Experian’s trended credit data is not currently a part of the Fannie Mae initiative, but it will likely be on board at some point in 2017.

As with the introduction of the new mortgage documents (TRID) last year, there may be a few minor kinks at first, but the use of trended credit data should be smoothly integrated into current systems soon after the rollout.

For more details about trended credit, contact your mortgage professional.

For more than 25 years, Omega Financial has been serving mortgage clients in Massachusetts. Our brokers have approximately 50 years in the mortgage business. You always will receive fast, courteous, and accurate information. Omega Financial, Inc. is a company duly licensed to operate in Massachusetts as a Mortgage Brokerage. We are located in the Town of Norwood, Massachusetts where we have been operating as Omega Financial Incorporated since 1988.

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