Inman News
Staff Writer
Carrington Mortgage Services LLC wants to boost lending to “underserved” borrowers with FICO scores below 640 — “a sizable market that is largely ignored by today’s lenders,” the company said today in announcing it’s loosening underwriting on FHA, VA and USDA loan programs, extending eligibility to more property types and reducing overlays.
Carrington estimates that 1 in 3 consumers has a FICO credit score below 650, and now the company is prepared to OK mortgages to borrowers with FICO scores as low as 550, as long as they meet other requirements.
To allocate resources to serve underserved borrowers, Carrington said it will eliminate conventional and jumbo loans from its wholesale product line on April 1, and limit its acceptance of wholesale submissions with FICO scores above 680. The company will make an exception for veterans, and continue provide VA loans “across the credit spectrum.”
More lenders are willing venture back into territory once considered “subprime,” as rising interest rates have put an end to the refinancing boom and lenders compete for a smaller pool of purchase loans, National Mortgage News’ Bonnie Sinnock reports. Continue reading
