GreenLyne has adopted FormFree’s Residual Income Knowledge Index (RIKI) to improve inclusivity in mortgage lending.
GreenLyne is an Inclusive-Finance-as-a-Service platform. RIKI is a risk-analysis model that analyzes cash flow and residual income to provide a more complete picture of a borrower’s creditworthiness.
By incorporating RIKI into its Automated Second-Look Engine, GreenLyne can more accurately predict a borrower’s risk of default and set appropriate loan terms that balance profitability for the lender and affordability for the homebuyer.
S0tandard underwriting models can’t assess default risk for borrowers who have thin credit files or FICO scores below 660. That means these borrowers are often excluded from housing finance. According to the Urban Institute, more than 39 million Americans have a credit score between 600-660. They are mortgage-ready, yet struggle to obtain a mortgage.
“Too many consumers who have a steady income and dutifully pay their bills on time are being excluded from homeownership because mortgage lenders haven’t had tools to assess their ability to pay. In effect, these consumers are being punished for an industry’s weakness, which is profoundly unfair,” said FormFree Founder and CEO Brent Chandler. “We are proud to provide GreenLyne with RIKI’s residual income analytics so it can pave a more inclusive path to homeownership for a large cohort of Americans.”
“GreenLyne’s fair lending credit underwriting innovation provides a precise path to safely and soundly expand homeownership for a large, unfairly underserved segment of Americans,” said GreenLyne CEO Syeed Mansur. “We are delighted to forge a deep partnership with FormFree, which couples a new era of consumer financial data with breakthrough advances in high accuracy credit risk prediction and fair underwriting that optimally balance affordability for borrowers and profitability for lenders.”