Fannie Mae's new rent reporting program could improve renters' homeownership opportunities. (iStock)
Fannie Mae recently announced a new partnership that will allow renters to report their payment history to credit bureaus. This could help build credit profiles, and even make homeownership more affordable for many who are renting, the mortgage giant said.
Through Fannie Mae’s new program, rent payments are reported to credit bureaus and will help improve a participant's credit score if it's made on time. The program is available for those whose multifamily property is financed through Fannie Mae.
Renters can see if they are eligible by reaching out to one of the three partners that Fannie Mae selected for this program: Esusu, Jetty and Rent Dynamics. Borrowers can compare the three companies and their offerings, such as additional rent payment loans at 0% interest, and submit a request to the company they choose.
If you are looking to improve your credit score, paying down debt can give it a boost. A personal loan is one way to help you pay down debt while also lowering your interest rate. You can visit Credible to compare personal loan options and find your rate without affecting your credit score.
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Benefits of the Positive Payment Reporting program
Fannie Mae explained that there are several benefits to its Positive Payment Reporting program.
"Rent is the largest recurring monthly expense that many households pay," Fannie Mae stated. "Having on-time payments reported to credit bureaus can help prepare renters to buy a home or get a better rate on a loan."
This program will open the door to homeownership for many renters who are able to boost their credit. It will also give them access to lower interest rates when they take out a mortgage or other credit products since their credit scores will be higher.
Even for those who don’t plan on buying a home, a higher credit score can help to lower future rent security deposits since that is determined by the renter’s credit score, Fannie Mae said.
If you are considering buying a home, comparing multiple mortgage lenders can help ensure you get the best interest rate for you. Visit Credible to compare multiple lenders at once and find the one that best fits your needs.
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Homebuyers searching for homes in these more affordable areas
The number of people looking to move to another metro reached a record high of 33.9% in July and August, according to a recent Redfin report. This was led by those who live in coastal cities with expensive job centers looking to move to a more affordable location.
Miami was the most popular destination for migrators, and San Francisco saw the largest outflow of residents. Other popular destinations included Sacramento, Calif., San Diego, Calif., Las Vegas, Nev., and Tampa, Fla.
"Although home prices in many of the popular destinations have increased significantly throughout the pandemic, they're still more affordable than the places homebuyers are coming from," the Redfin report said. "The typical home in Las Vegas, for instance, sold for $416,000 in August, half of the $845,000 median in Los Angeles, the number-one origin for people moving in."
If you are looking to move to a more affordable city, consider using an online marketplace like Credible to find the best mortgage rates for you. You can also contact Credible to speak to a home loan expert and get all of your questions answered.
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