Assume there is a U.S.-based borrower and that you have a credit score of 621. Given your
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Assume there is a U.S.-based borrower and that you have a credit score of 621. Given your credit score of 621, it seems much more likely that your local banker will be able to originate-and-sell your mortgage to a GSE, since you are slightly above the minimum threshold of 620.
How might this ability-to-sell affect the incentives of your local banker to evaluate potential borrowers such as yourself? Does the banker have a stronger or a weaker incentive to carefully screen mortgage applicants for creditworthiness and ability to make mortgage payments, given that the mortgage will likely be sold to a GSE? Explain.
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