Fannie Mae and Freddie Mac will use a four-phase process for validating and approving third-party credit score models under the Federal Housing Financial Agency’s (FHFA) new final rule, which implements Section 310 of the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA).
The new rule describes each phase in detail and establishes timeframes for each. The rule also details how the GSEs will handle their current credit-scoring model – “Classic FICO.”
Find out more about the implications of the final rule.