For the past several years, housing affordability has been discussed as if it were a force of nature. Everyone agrees it is a problem, everyone studies it, and yet it often feels beyond reach, like something that can only be changed by sweeping legislation or a dramatic shift in interest rates. What feels different right now is that some of the most immediate levers are not theoretical at all. They are administrative. They do not require Congress, but rather decisions. And that is why debates that may seem narrow or technical (like the cost and structure of credit reports) are a test of whether the industry and its regulators are willing to fix what can actually be fixed, even when incumbents push back.
Mortgage lending is relentlessly competitive. When input costs come down, those savings do not sit on balance sheets for long. They get passed through to borrowers, because lenders that do not sharpen pricing lose business. This is not an ideological claim. It is the lived reality of a market where margins are thin and volume is fought for loan by loan. That is why it is hard to take seriously the suggestion, floated by credit bureau trade groups, that reductions in credit report costs would not benefit consumers. That argument only works in markets without real competition – like credit reporting and scoring. Mortgage is the opposite of that.
The above framed this year’s Independent Mortgage Bankers Conference, which drew nearly 700 attendees and carried a noticeably more energized tone than in recent years. The strong participation from independent mortgage banks and warehouse lenders underscored a simple truth: neither exists without the other. The industry is still constrained, but it is no longer paralyzed. What stood out was not a single keynote or breakout session, but a broader shift in mindset. Lenders are back to executing. They are not ignoring challenges. They are actively trying to solve them. And the biggest structural constraint still hanging over everything is cost.
The credit report discussion is not about irritation or symbolism. It is about unnecessary expenses embedded in the origination process and whether the industry can modernize a requirement that is costly and, according to the regulator’s own analysis, no longer justified in its current form. The Federal Housing Finance Agency has already done the work. It concluded that two credit reports are as predictive of mortgage performance as three. FHFA is not a casual observer here. As conservator of Fannie Mae and Freddie Mac, its mandate is to protect the enterprises’ assets. The risk question has already been asked and answered. What remains is identifying a better alternative and careful implementation.
Some have raised concerns that lenders could game a non-tri-merge system by pulling multiple reports and only submitting the most favorable one. That would clearly be unacceptable. It is also entirely preventable. The solution is straightforward: if you pull it, you submit it. Credit reports are billed per pull using identifiers that can be audited. Lenders already track this data, and the enterprises can as well. If a lender is consistently pulling more reports than it delivers, that discrepancy would be visible and enforceable through compliance reviews.
Others worry about pricing outcomes, particularly near score cutoffs. If a first report comes in just above a threshold, a lender might wonder whether a second report would have yielded a slightly better score and therefore better pricing. That can happen. The opposite can also happen. Variance cuts both ways. The existence of variance is not a justification for imposing a blanket requirement that increases cost across the entire system, especially when the incremental risk benefit has been shown to be negligible.
MBA has proposed a pragmatic approach: use a single bureau above a defined credit score cutoff, with 700 as a starting point for discussion. The logic is simple. As scores decline, dispersion between bureaus can widen, and there may be sound risk reasons to rely on more than one report in that range. But the exact number is not sacred. FHFA and the enterprises have the data and should set the threshold based on empirical analysis. If that number is higher, lower, or structured differently, the industry can adapt. The goal is not to win a debate over a cutoff. The goal is introduce competition where today there is none; to remove unnecessary cost while maintaining disciplined risk management.
It is also worth grounding this discussion in reality. The average Fannie Mae borrower credit score in recent quarters has been around 757. A significant portion of enterprise volume sits well above the bands where concerns about bureau divergence are most acute. For those loans, the current tri-merge requirement is pure overhead.
Questions about secondary market reception are fair but not disqualifying. If additional reports do not improve predictiveness, there is no reason they should improve pricing. Today, investors see only one score – the middle one – not three. It has a one-third chance of being the “right” score. In a single-file world, the investor sees one score that has the same one-third chance of being the right one. The only assurance the investor gets from tri-merge is that they aren’t getting an outlier score. However, that outlier score can often be the “right” score. These are questions that can be answered with data, and the GSEs have all the data. MBA has made a policy recommendation, based on our members’ analysis of their own data, for a single score and asked the FHFA and the GSEs evaluate their data and offer a solution that brings competition, lowers costs and will lead to improved data.
There is precedent across other lending products, including home equity, where single-bureau approaches are standard. More importantly, this is not a permanent leap into the unknown. If lenders choose to pull more reports for their own operational comfort and submit what they pull, the market will generate real-world data quickly. We can observe outcomes, adjust if needed, and move forward based on evidence rather than fear.
What makes this moment especially urgent is that credit reports are only one of several affordability levers that can be pulled without legislative action. Adjustments to loan-level price adjustments and thoughtful reductions in FHA mortgage insurance premiums also fall into this category. These decisions require coordination and responsibility, but they do not require Congress. If the objective is near-term relief for borrowers, administrative decisions matter more than distant policy theories.
Another underappreciated lever sits on the supply side: condominium eligibility. Today, more than 1,000 condo projects are no longer eligible for enterprise financing due to insurance requirements that tightened after Surfside. The increased caution is understandable. The unintended consequence is that thousands of otherwise viable units are effectively locked out of the financing system. Modernizing these requirements so projects can obtain available and affordable coverage, without imposing destabilizing assessments on homeowners, would reopen access quickly. This is not a headline issue. It is a practical one, and solving it would immediately expand the pool of financeable housing.
Looking ahead, there is also an opportunity for a reconstituted CFPB to focus on rulemaking that directly shapes borrower and lender outcomes, including loan officer compensation, servicing rules, and long-overdue attention to RESPA. These are not glamorous topics. They are, however, foundational to how the mortgage system actually operates day to day.
Housing affordability will not be solved by slogans or a single dramatic announcement. It will improve through a series of administrative choices that remove friction, reduce unnecessary cost, and expand access without eroding risk discipline. The credit report debate is one of those choices. It is imperfect and incomplete, but it is available now. Treating available fixes as impossible problems is a choice in itself. If we want progress, the industry needs less theater and more decisions.