Suddenly this phrase does not really mean what it use to! A new quality control measure put into place by Fannie Mae and Freddie Mac have added yet again, another new guideline to our already overburdened process. This new requirement, called the LQI or Loan Quality Initiative, states that a new credit report must be obtained by the lender on all mortgage loans at the funding table, and minimum credit guidelines met. If your credit scores are borderline, this simple inquiry can mean a last minute denial of your loan application because frequent inquiries into your credit history can cost you points off your credit scores. The idea here is to determine whether you’ve opened any new accounts, increasing your debt load and thereby hampering your ability to qualify, or whether you have become delinquent on any debts during the processing of your loan, but the simple inquiry itself can be detrimental as stated above. Here is the actual LQI language from Fannie Mae. [Read more...]