DU® Validation Service

In October 2016, Fannie Mae named Equifax the first designated third party provider of income and employment verifications for Day 1 Certainty™ as part of the validation service powered by Desktop Underwriter® (DU®). This includes instant income and employment verifications obtained via The Work Number® database and those that Equifax completes manually on a lender’s behalf. The DU validation service also incorporates validated income that has been reported to and received by the IRS via the Equifax 4506-T tax transcript service. Additionally, the service includes an asset validation component through a solution provided by FormFree.

What does this mean for you as a lender?

Fannie Mae has designed the DU validation service in an effort to provide lenders with improved processes that add an enhanced level of certainty to the loan origination process. Additionally, through this new service, you have the opportunity to potentially improve processes you may have in place today – improvements that can have a positive impact for both your business and consumers alike.

Reduce potential income fraud exposure in the underwriting process

Today, many lenders verify an applicant’s income and employment themselves. Fannie Mae’s new service includes income and employment verification from an independent third party – Equifax – helping you reduce fraud exposure in the application process.

Meet consumer expectations in a fast changing market

Technology is evolving and consumers’ expectations are changing. The DU validation service can help you provide an experience that consumers have come to expect in a world where they increasingly do banking and business on mobile devices, expect quick answers and don’t want the headache of providing scans, faxes or paper documents.

Streamline operations

Since the DU validation service institutes third party verification of income and employment data as part of the initial underwriting process, a validated loan can be processed in a more automated and streamlined fashion, potentially reducing the time to underwrite a loan and helping enable a quicker time to close.

Still asking yourself how all of that can be possible?

As the first designated third party provider of verifications for the Fannie Mae DU validation service, Equifax delivers the experience and solutions you need to make
Day 1 Certainty easy.

  • Income and Employment Verifications: Through Equifax, you can verify employment and payroll income in seconds with The Work Number, the largest database of instantly available employment and income records contributed by thousands of employers nationwide. If an applicant’s information isn’t instantly available on the database, Equifax agents can reach out to the applicant’s employer and fulfill the verification on your behalf, eliminating the need to burden the consumer with having to provide pay-related documentation, in most instances. In 2016 alone, Equifax completed over 90 million verifications. This isn’t something ancillary we offer – we have a proven process and it’s at the core of what we do every single day.
  • IRS Income Verification: For deeper insight into an applicant’s income, the IRS Income Verification (4506-T tax transcript service) from Equifax enables lenders to retrieve all tax transcript forms via streamlined fulfillment through our direct connection with the IRS. Our upfront quality check, robust QC reporting capabilities, eSignature Capture offering, and other features can help you receive Day 1 Certainty with faster tax transcript results and fewer rejections from the IRS.
  • NEW – Asset Verification: Through an alliance with FormFree, Equifax can offer the Asset Verification through AccountChek™, a service that allows you to order asset information, collected directly from the financial institution. This information may help you analyze and certify a borrower’s financial data, as well as eliminate the need for borrowers to collect, copy and submit paper statements.

Audit by Loan Number (ABLN)

By opting into the program with Equifax, audit copies of income and employment verifications can be passed, upon request, to Fannie Mae. The audit copy will be provided based on Social Security Number + loan number – this transaction is called Audit by Loan Number. By receiving these audit copies, Fannie Mae can review the income and employment details and provide a validation where applicable. For those loans where a validation is received, you may be relieved of having to collect and provide paystubs, W-2s and other pay-related documentation. The verification output from Equifax will replace those traditional paper documents.

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Resources

Audit by Loan Number Overview

Equifax DU Validation FAQs for Lenders

Fannie Mae DU Validation Resources

Fannie Mae Day One Certainty

What this means for consumers

Today’s loan applicants often have to provide W-2s and pay stubs when applying for a home mortgage. With the DU validation service, Equifax will independently verify income and employment – through The Work Number database (and through our manual process when an applicant’s information is not available on the database) as well as the IRS – and where validated, the applicant may not be required to provide those documents.