PennyMac Confronts Rising Credit‑Report Fees and Possible Shift to Single‑Bureau Pulls

PennyMac Confronts Rising Credit‑Report Fees and Potential Shift to Single‑Bureau Pulls

PennyMac Financial Services faces a growing operational and pricing issue as mortgage lenders push back against rising borrower charges for credit reports, a routine closing cost that is increasing rapidly. The Mortgage Bankers Association tells Federal Housing Finance Agency Director Bill Pulte that these fees could climb an average 40% to 50% in 2026, and it urges allowing lenders the option to rely on a single credit bureau for borrowers with scores of 700 or higher instead of the customary tri‑merge report. For lenders that originate, service and sell loans — including PennyMac — such a change would affect both consumer disclosures at closing and internal underwriting workflows.

The company, like most mortgage originators, must align with Fannie Mae and Freddie Mac standards because the government‑sponsored enterprises dominate the secondary market and shape acceptable underwriting and disclosure practices. Fannie Mae’s November decision to remove a minimum credit score from its automated underwriting system further shifts the landscape, increasing the pressure on lenders to adapt systems that now evaluate risk differently. PennyMac’s origination, collateral evaluation and pricing models are therefore directly exposed to any policy that reduces the number of credit pulls or alters allowable fees, potentially lowering some borrower friction while requiring system and compliance adjustments.

Operationally, a move toward single‑bureau pulls for higher‑score borrowers promises savings and faster closings but raises execution questions for large lenders. PennyMac must weigh potential cost reductions against the need to maintain fraud and accuracy checks that tri‑merge reports provide, and to ensure consistency for loans intended for sale to the GSEs. Any industry shift would prompt updates to loan delivery specifications, consumer disclosures and vendor contracts, and could influence how PennyMac allocates technology and compliance resources across origination and servicing platforms.

Regulatory crosscurrents and market incentives

Because the FHFA oversees Fannie Mae and Freddie Mac, its response to the MBA request carries immediate weight for mortgage firms. Regulators face calls to balance lower costs and friction with safeguards that protect borrowers and market stability.

Consumer credit profiles and the debate ahead

Most homebuyers already have strong credit — 2024 New York Fed data shows average scores of 734 for first‑time buyers and 775 for repeat buyers — which supporters of single‑bureau pulls cite as justification. Critics warn lost redundancy may weaken protections, leaving lenders such as PennyMac to navigate competing demands for efficiency and consumer protection.