Disputed credit accounts
A credit dispute does not automatically kill a conventional loan—but it can change how the AUS evaluates the file.
Fannie DU's two-step analysis
DU first evaluates the loan including disputed tradelines. If DU still issues Approve, Fannie says no further documentation or action is required for that dispute scenario.
If DU cannot approve with the dispute included, it can reassess without the disputed tradeline. If that produces Approve, the lender must investigate whether the borrower owns the account and whether the reported information is accurate and complete.
When the dispute becomes a problem
If the borrower is responsible for the account and the adverse information is accurate and complete, a DU approval that depended on excluding the disputed account is not eligible for delivery as a DU loan. An otherwise eligible transaction may need manual underwriting.
Medical disputes
Fannie's current DU guidance says disputed medical tradelines are not shown in the disputed-tradeline message and lenders are not required to investigate them under that rule.
Official guide baseline
Fannie Mae Selling Guide · Freddie Mac Seller/Servicer Guide
Agency guide and AUS findings control over summaries. Lender and mortgage-insurer overlays may be more restrictive.