While digital experiences are rapidly becoming the norm for mortgage lending, the verification process has largely remained a manual, paper-driven process. Fortunately, this is changing.

Finicity, a Mastercard company, is the only authorized report supplier that offers a digital, single-vendor solution for assets, income, and employment authorized for representation and warranty relief through both Freddie Mac and Fannie Mae. By automating the asset and income verification process, providing transaction data for rent payment history and providing a 10-day pre-closing report, we can help you streamline the approval process and in turn even be a more inclusive lender. 

Approved by Freddie Mac and Fannie Mae 

Finicity is an authorized supplier for Freddie Mac’s Loan Product Advisor® AIM, which automates borrower assets, income, and employment assessment for lenders. By leveraging the expertise of third-party service providers, AIM helps to deliver a simpler, more efficient loan origination process.

Fannie Mae’s Desktop Underwriter® (DU®) validation service also accepts our mortgage verification services to independently validate borrower assets, income, and employment data—providing Day 1 Certainty® on validated loan components. By digitally validating secure third-party data through DU, you can help eliminate the paper chase and help get your borrowers approved quicker.

Rent payment history in credit decisioning

On September 18, Fannie Mae introduced the inclusion of rent payments in their automated mortgage credit decisioning process in DU. Fannie Mae identifies recurring rent payments in bank statements and transaction data as a factor which could deliver a more inclusive credit assessment

For first-time homebuyers who may have a limited credit history but a strong rent payment history, the enhancement creates new opportunities for homeownership while still promoting safe lending. Fannie Mae said 17% of applicants who have not owned a home in the last three years and who did not receive a favorable mortgage recommendation could have instead received an “approved” or “eligible” recommendation if their rental payment history had been considered.

To take advantage of the rent payment history feature, Finicity provides a Verification of Asset and Income (VOAI) report through its Mortgage Verification Service (MVS) that includes up to 24 months of transaction data that Fannie Mae can use to identify rent payment history and provide a more favorable credit assessment.

The VOAI report can be called with a direct API or is available currently in ICE Encompass and Encompass Consumer Connect, as well as the SimpleNexus mortgage point-of-sale (POS) platform. 

In addition to VOAI, we’re pleased to announce that we now offer Verification of Asset (VOA) as a standalone product. Lenders can utilize Finicity’s VOA report to provide 12 months of data and participate in Fannie Mae’s rent history assessment. Lenders have the freedom to access two and 12 months of data to satisfy their own underwriting requirements, while VOA automatically sends 12 months to Fannie Mae, keeping the file GSE-compliant. 

The VOA report is available via direct API connection or on most ecosystem platforms.

10-day pre-closing verification

Additionally, Finicity’s 10-day pre-closing reports provide just the right data GSEs need for 10-day verification of employment.

In adding a 10-day pre-closing report to our mortgage verification services, we have enabled lenders to receive only the data GSEs require for the 10-day verification. You can use these 10-day pre-closing reports to view just your borrower’s employment status rather than refreshing our current full reports that contain financial data. This minimizes the introduction of new income data or other redundant and unnecessary underwriting changes.

One of the reports available is the VOE Transactions report, which contains 120 days of refreshed transactions with dates and description but no amounts or totals so that income is not re-assessed. It shows the latest direct deposits in the income streams so that it can be determined that the borrower is still being paid on their regular cadence.

Another option is the VOE Payroll report. This contains only employment status—no income or other data—so lenders can see that the individual is still employed according to their payroll provider.

Our 10-day pre-closing reports are part of MVS at no extra charge and are currently only available for lenders connecting directly to Finicity.

These new reports could help you improve accuracy and simplify the process of verifying employment within ten days of closing, which is simplifying the loan origination process even further without increasing risk. Because these products are part of Finicity MVS, you would no longer have to call your borrower’s employers to get the information or manually ask for any extra interaction from the borrower.

How can you access these 10-day pre-closing reports?

To pull the VOE reports today, your team will need to code directly to the endpoints. You can find documentation here. As we integrate them further into LOS and POS platforms, they will be even easier for consumer loan officers to access. To see Finicity’s Mortgage Verification Services in action, request a demo here.