Did the Supplemental Performance Metric (SPM) replace the Compare Ratio and how do they differ?

The Supplemental Performance Metric (SPM) does not replace the Compare Ratio. The SPM is used as additional information for evaluating a Mortgagee’s performance.

In contrast to the Compare Ratio, which evaluates a Mortgagee’s origination and underwriting performance against  the performance of other institutions, the SPM compares a Mortgagee’s default and claim rates on mortgages originated or underwritten within specific credit score bands against target default and claim benchmarks for those same credit score bands.
A Mortgagee’s SPM and Compare Ratio are available in the Neighborhood Watch Early Warning System.
A comprehensive list of Help topics can be found in Neighborhood Watch under the “Help/About” tab on the Neighborhood Watch home page.

Neighborhood Watch can be accessed by approved Mortgagees at https://entp.hud.gov/sfnw/nw/
Public access to Neighborhood Watch is available at https://entp.hud.gov/sfnw/public/
For more information access FHA's Supplemental Performance Metric Fact Sheet at https://www.hud.gov/sites/documents/SF_SPMFACTSHEET.PDF

HQ Policy; FHA INFO #14-24  https://www.hud.gov/program_offices/housing/sfh/FHA_info_messages

All policy information contained in this knowledge base article is based upon the referenced HUD policy document. Any lending or insuring decisions should adhere to the specific information contained in that underlying policy document.

Topic Number: KA-04790