This article originally appeared in the July 2025 edition of MortgagePoint magazine, online now.
Malloy Evans is Fannie Mae’s EVP and Head of Single-Family, reporting to the President and Chief Executive Officer. He leads the company’s Single-Family business division, including the teams responsible for providing consistent and reliable liquidity to the single-family mortgage market, facilitating access to affordable homeownership, and managing the risk of the company’s $3.6 trillion mortgage loan portfolio.
Evans has served in various roles during his tenure at Fannie Mae, most recently as SVP and Single-Family Chief Credit Officer, where he was responsible for first-line credit risk management from mortgage acquisition through disposition. He has also held other leadership roles overseeing risks across the Single-Family mortgage life cycle, as well as the company’s administration of the Treasury Department’s Making Home Affordable (MHA) program. He has a Bachelor of Science in chemistry from Davidson College and a Juris Doctor from Washington and Lee University School of Law.
From Fannie Mae’s perspective, what are the most significant barriers prospective homebuyers face today—particularly first-time buyers—and how are you working to address them?
Evans: Affordability is a big hurdle for prospective homebuyers, especially first-time homebuyers. It’s a complex issue driven by many factors like home price appreciation, interest rates, lack of supply, inflation, and the pace of household income growth. Unfortunately, these factors are largely outside of Fannie Mae’s control. That’s why we’re focused on homeownership barriers we can influence, working in partnership with the primary market.
Based on our research, two factors that fall in this category are credit invisibility and insufficient funds to close. There are many people who fit in our existing credit box and are ready to be homeowners, but traditional underwriting processes and credit bureau data don’t tell us their full story. There are also plenty of consumers who have a good credit history and the means to handle monthly mortgage payments, but they just don’t have enough savings for down payments and closing costs. Fannie Mae is focused on providing consistent and reliable liquidity to the market and delivering tools and services that address these barriers in a safe, sound, and sustainable way. We are constantly developing and refining services that make homeownership more accessible.
How is Fannie Mae innovating to make the mortgage process more accessible and more efficient for borrowers?
Evans: Innovation plays a critical role in helping lenders make more loans and enabling a more efficient origination process, especially as customer and market needs change. At Fannie Mae, that means supporting as much of the conventional market as we can within our risk appetite. We are focused on developing solutions that break down barriers to access and set borrowers up for success.
Tackling credit invisibility is a great example of this. We’ve introduced a number of innovative products, tools, and enhancements to help us see and approve more potential borrowers who are ready to purchase a home and maintain a mortgage but historically have been overlooked. Solutions like positive rent payment history and cash flow underwriting, and enhancements to our assessment of potential borrowers with limited or no credit histories, have expanded our ability to serve creditworthy homebuyers who weren’t visible before.
We also innovate to improve how processes work in both the primary and secondary markets, with a focus on delivering differentiated value to our business partners. Teams across Fannie Mae are committed to helping our customers take full advantage of the many capabilities we offer, enabling them to strengthen their risk management and improve their business outcomes. Fannie Mae itself was born as an innovation. Innovation is in our DNA. We apply it every day to modernize the mortgage finance experience and explore new ways to make the mortgage origination process simpler, smarter, and more accessible—without compromising our strong risk management philosophy.
What are some of the most impactful examples of these innovations in supporting affordable and sustainable homeownership?
Evans: It all starts with Desktop Underwriter® (DU®), which has been the preeminent automated underwriting system in the market for 30 years. In fact, DU just turned 30 years old this past April. It comes with a suite of powerful capabilities that enable our customers to streamline and optimize workflows, pre-qualify borrowers with a soft credit check, validate income, assets, and employment with a single asset report, leverage positive rent payment history and cash flow underwriting, and so much more.
DU is the cornerstone. It’s used by 1,200 lenders nationwide and has enabled $11.4 trillion in mortgage funding since 2000, helping around eight million first-time homebuyers. Since 2018, DU has reviewed about two-thirds of all conventional closed mortgage loans. A tremendous volume of business is processed through the platform each day, so it demands constant innovation to support the market as efficiently and comprehensively as possible. We are continually investing in DU to make it better.
Our DU Version 12.0, which we introduced earlier this year, is helping lenders serve borrowers in multiple new ways. For instance, we’ve improved our ability to assess credit risk delinquency factors, which means we can say “yes” more often without sacrificing risk principles. As a result, we’ve seen DU approvals increase by over three percentage points since the DU 12.0 release.
We also enhanced our positive rent payment and cash flow underwriting capabilities to extend benefits to more first-time homebuyers. Since the release of our positive rent payment history enhancement, we’ve seen a sharp increase in the number of loans that have benefited; that is, those that received an approved/eligible recommendation in DU that wouldn’t have previously. We’ve also expanded the pool of borrowers
who can benefit from a cash flow assessment. It’s no longer limited only to those without a credit score.
Income Calculator is another great example of Fannie Mae innovation at work to solve a specific need. This is a
new solution we introduced to the market, first in 2023 followed by a significant enhancement in 2024. It helps lenders and other mortgage professionals serve the growing number of aspiring homebuyers who are self-employed and don’t have traditional sources of income. Loans to self-employed borrowers have historically been some of the most difficult and time-consuming to execute. They represent approximately 10% of the U.S. workforce and approximately 12% of Fannie Mae deliveries. Income Calculator streamlines the process and
improves outcomes for both lenders and borrowers. It removes complexity for lenders for a variety of self-employed business structures and maximizes borrower income for qualification. It also increases certainty of loan quality, which our lenders have asked for. Since we launched the tool, over 630 lenders have created more than 160,000 income evaluations using a simpler way to calculate income for borrowers who are self-employed, have business ownership, or rental properties.
We have other new innovations on the horizon, and we’re constantly improving the tools and resources already in flight. We’re not slowing down. We want to help lenders take advantage of all our solutions to support more homebuyers and grow their business while saving time and money in the process.
What about solutions that reduce costs for borrowers so they can actually reach the closing table?
Evans: We’re very focused on reducing costs to help applicants become homebuyers. Fannie Mae’s flagship HomeReady® mortgage program is a good example. It’s specifically designed to support low-income and very-low-income borrowers by lowering down payment and closing cost requirements. HomeReady requires just a 3% down payment for creditworthy borrowers and also offers lower mortgage insurance costs.
Borrowers don’t need to be first-time homebuyers to take advantage of HomeReady. And we enhanced the product to include $2,500 towards reimbursement of funds provided by lenders for down payments or closing costs for qualified, creditworthy very-low-income purchase borrowers. This enhancement is available to all Fannie Mae-approved lenders, making it a powerful tool to help increase homeownership opportunities for borrowers at or below 50% AMI.
We’ve also introduced several other cost-saving measures across the mortgage origination spectrum. For instance, our suite of valuation modernization options has saved borrowers about $2.9 billion in appraisal costs since 2020, and our title modernization options have saved borrowers over $12 million. These savings can make a huge difference for homebuyers, especially in a challenging housing market.
Fannie Mae is committed to providing liquidity to ensure access to the affordable housing market, consistent with our Charter. We’re listening to our lenders—they’re on the front lines with borrowers, after all—and we’re using their feedback to make the mortgage process easier, less expensive, and more accessible for everyone
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