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Fannie Mae Cleared for Mistaken Foreclosure Report

Jan. 9, 2019, 8:20 PM

Fannie Mae isn’t liable under the Fair Credit Reporting Act for falsely informing potential mortgage lenders that customers had a prior foreclosure on a mortgage account, the U.S. Court of Appeals for the Ninth Circuit ruled Jan. 9.

The FCRA provision doesn’t apply to Fannie Mae because it isn’t a consumer reporting agency, the court said in a 2-1 decision.

Fannie Mae isn’t a consumer reporting agency because it doesn’t assemble or evaluate consumer information in order to furnish consumer reports to third parties, the court said.

The case stems from Fannie Mae’s software, called desktop underwriter, which lenders can ...