FHA (the Federal Housing Administration) reports, “For the first time the average FICO score for insured cases reached the 700 level — actually 702.”
But, somebody thinks that’s not necessarily such a great thing. The U.S. Department of Housing and Urban Development (HUD (FHA is part of HUD)) has just opened investigations resulting from complaints filed by the National Community Reinvestment Coalition (NCRC). NCRC states that its investigation “reveals that too many of the country’s largest financial institutions are refusing to lend under the FHA loan program to consumers with credit scores between 580 and 640, despite the fact that FHA policy establishes a 100% guarantee for refinance.”
However, lenders are judged by their default and claim rates, and their underwriting authority can be termintated if those rates are too high.
Also, see: Average credit score chart, FHA loans.