Sponsor
Al Green
Representative · D-TX
Representative · D-TX
The bill could expand mortgage access for credit-invisible borrowers and produce useful public data, but it raises material financial risk to the FHA fund and may be undermined by limited opt-in uptake and added compliance costs.
Low-income individuals and people with thin or no credit files may gain access to mortgage approval by opting into alternative-data credit scoring, increasing their homeownership opportunities.
Prospective mortgagors receive clearer information and counseling resources so they can make informed choices between standard scoring and the pilot alternative-scoring outcomes.
Taxpayers and policymakers will get public reports on participation, approval rates, demographic effects, and FHA Mutual Mortgage Insurance Fund impacts, improving oversight and evidence for future policy decisions.
Taxpayers and middle-class families could face financial risk if alternative-data models increase default rates and thereby harm the FHA Mutual Mortgage Insurance Fund.
Low-income individuals and borrowers with thin credit files may not benefit as intended because the program's opt-in design could limit uptake among those unaware of or distrustful of alternative scoring.
Mortgage lenders, model vendors, and participating borrowers may incur additional compliance and operational costs to implement opt-in procedures, notices, and side-by-side comparisons, which could be passed on to borrowers.
Based on analysis of 2 sections of legislative text.
Creates an FHA pilot letting borrowers without traditional credit history opt into alternative credit-scoring models using additional data and requires HUD evaluation and borrower notices.
Official title: To authorize a pilot program under section 258 of the National Housing Act to establish an automated process for providing additional credit rating information for mortgagors and prospective mortgagors under certain mortgages.
Introduced April 16, 2026 by Al Green · Last progress April 16, 2026
Creates an FHA pilot program that lets borrowers with limited or no traditional credit history opt into commercially available credit-scoring models that use “additional data” (nontraditional credit information). HUD must notify borrowers, require lenders to provide side-by-side comparisons of pilot vs. standard FHA underwriting, preserve other underwriting rights, and report to Congress on participation and outcomes. The Secretary must select model(s) within one year after enactment, consult Ginnie Mae, consider FHFA criteria, and protect proprietary model details; the bill focuses on evaluating whether alternative scoring expands access to mortgage credit for borrowers lacking sufficient credit histories.