Government Audit Finds FHA’s Credit Scoring Model Inferior, Not Used as Well as It Could Be
May 19, 2006
The FHA’s credit scoring model is outdated and inferior compared to its competitors, according to a new Government Accountability Office report. The findings underscore recent years of declines in FHA mortgage originations and product innovations. The GAO found that FHA’s Technology Open to Approved Lenders Scorecard, which evaluates the majority of new loans insured by the FHA, was based on outdated data when it was implemented in 2004. Additionally, the GAO said FHA has not…