Fannie Mae and PMI Mortgage Insurance Co. said they completed a test of Fannie Mae's automated underwriting program for loans insured by the Federal Housing Administration program.
The companies said at the Mortgage Bankers Association convention that Fannie Mae's automated underwriting program will be available for commercial use in early 1999, upon approval by the Department of Housing and Urban Development.
FHA-approved lenders tested the product and processed over 4,000 loans with an approval rate of almost 55%, the companies said.
Lenders using Fannie Mae's automated underwriting will also be able to obtain loan decisions from GE Capital Mortgage Services Inc. for jumbo, fixed-rate mortgages, the companies said. GE Capital's scoring technology uses information on the borrower and collateral to determine a loan's risk. The companies plan to offer the service to lenders in mid-November.