Freddie Mac helps lenders bring self-employed underwriting into the digital age
Q&A with Andrew Higginbotham on new asset and income modeler and LoanBeam integration
May 9, 2019 Alyssa Stringer
HW sat down with Andrew Higginbotham, senior vice president and chief operating officer, single-family, at Freddie Mac, to talk about the company’s new asset and income modeler (AIM) for self-employed borrowers.
Q. What led Freddie Mac to expand its highly-successful AIM program to include income assessment for self-employed borrowers?
A. Today’s mortgage and housing industry cannot operate efficiently using yesterday’s tools and our clients know that success with their customers depends on improving service. There are millions of self-employed workers in the United States and that number is only expected to grow, which means traditional underwriting standards and techniques won’t accommodate this new demographic.
We are working to develop cutting-edge algorithmic models fueled by data analytics to help our lenders underwrite quality loans quickly and cost-effectively. The bottom line: a better borrower and lender experience and a more liquid and financially sound housing market.
Q. How is Freddie Mac preparing to better serve future borrowers?
A. We are always thinking about ways to better serve the housing industry, its clients and borrowers. Our Loan Product Advisor AIM for the self-employed provides our lenders with a new way to make their processes more efficient – to cut costs and reduce cycle times.
It gives them a competitive edge to expand their business in a tightening purchase market by penetrating a growing, underserved market, and it gives them confidence that the loans they deliver align with Freddie Mac’s purchase eligibility requirements as captured in Loan Product Advisor. With our AIM for self-employed program, we are able to open the door to an easier mortgage experience for an entire group of potential borrowers who were previously underserved by the traditional methods.