Fannie Mae and Freddie Mac have recently begun requiring the credit reports they receive for loans funded to have trended data on them. This means that the report isn’t just a monthly snapshot of your current credit situation; it actually shows what your balances were for the last 12 months.
If you’re someone who has recently paid off your credit cards to lower the balances in order to inflate your credit score, the underwriter will see that you held balances for X number of months.
For those who pay off their credit cards regularly but wait until the due date to do so, the credit reports will show that you have a higher balance than you think you have because most creditors report that information before the payment is due.
If you have any other questions about credit or trending data, please reach out to us. We’d love to help you understand the subject better.