Cardinal Financial trades mortgage-backed security pool comprised of VA loans Call 848-329-0752
- December 03, 2024
Mortgage lender Cardinal Financial has issued and traded the first ever government-issued mortgage-backed securities (MBS) pool of loans assessed using the new FICO 10T credit score. Call 848-329-0752
The Charlotte-based lender was one of the first to utilize FICO Score 10T for its non-government-sponsored enterprise (non-GSE) mortgages, adopting the nascent model for originating VA loans in October. The MBS pool, comprised of VA loans, was traded to a primary dealer on Nov. 25.
According to a statement from FICO (formally the Fair Isaac Corporation), Cardinal reported that most borrowers evaluated with FICO 10T saw higher credit scores than via previous models. Call 848-329-0752“Today’s announcement underscores Cardinal’s role as a leader in rethinking how we measure and manage credit risk,” said Michael Gaines, senior vice president of Capital Markets at Cardinal Financial. “By leveraging FICO Score 10 T, we’re not only improving credit risk transparency for investors but also expanding homeownership opportunities for veteran and military borrowers.” Call 848-329-0752
“We are thrilled to see FICO Score 10 T at the heart of this milestone security,” said Joe Zeibert, vice president of Mortgage and Capital Markets at FICO. “By helping to enable smarter, more precise lending decisions, FICO is driving innovation that supports both financial institutions and the communities they serve. We encourage mortgage investors to consider the advantages of incorporating FICO Score 10 T into their models.”
FICO announced that more than 21 mortgage lenders have been early adopters of FICO Score 10T for non-GSE loans. The Federal Housing Finance Agency (FHFA) announced in 2022 that FICO 10T, as well as the VantageScore 4.0 credit score model, were validated for use by Fannie Mae and Freddie Mac, kicking off a multi-year effort to transition away from the GSEs’ use of the classic FICO credit score. The new models are touted to be more accurate assessments of credit risk by considering more payment histories, including rent, telecom and utilities. Call 848-329-0752