News From Underwriting 2016 W-2s & transcripts 2-1-17
August 24, 2016 - USDA Upfront & annual premium being reduced
Since the self-employed income policy updates were announced last year, lenders have provided feedback
regarding the difficulty in obtaining documentation to evidence a borrower’s ongoing access to business income,
and asked for additional guidance on how to determine whether the business has adequate liquidity to support the
withdrawal of business earnings.
Effective with loans closed on or after June 15, 2016, 2015 tax transcripts will be required.
If a borrower has filed an extension, Essex will require:
9/10/15 CalFHA has announced discontinuation of CHDAP 2nd Program!
Are you ready?
• Conversion of principal residence to rental.
30% equity no longer required, Additional reserves no longer required, may follow normal rental income guidelines.
Effective immediately, Sapphire loans must have:
680 minimum FICO score for all borrowers
Maximum 50% DTI
Require $1000 admin fee to Essex – please include in BOX 1 of GFE
Borrower paid compensation of 1.5% allowed
A processing fee is no longer allowed to be charged.
Loans currently in our pipeline will be honored
under the previous guideline
Call your Account Executive today if you have any questions.
Effective with loans closed on or after June 15, 2015, 2014 tax transcripts will be required...
Effective 1/21/15, Lenders may no longer charge interest past the payoff date: HUD HAS CLARIFIED THAT THIS WILL BE EFFECTIVE FOR LOANS THAT CLOSE AFTER 1/21/15 ONLY
HUD has recently announced the reduction of MIP. We have a window of opportunity to cancel existing case numbers in order for our customers to take advantage of this announcement.
No other details on when the change will be effective or what the effective date will be based on.
All sales contracts must be fully executed prior to 12/31/14 (11:59 pm) to be eligible for the 90 day flip waiver.
Although some county limits have increased to $417,000 due to this alignment, some have been reduced to $625,500
The Maximum LTV on cash out refinances is now 80%.
Effective 1/21/15, Lenders may no longer charge interest past the payoff date
Due to HUD indemnification requests, going forward, a copy of the donor’s recent bank statement will be required..
Most counties are unchanged
Requirements for loans funding on or after October 15, 2014
All FHA, VA, USDA & Conventional Programs where tax returns are required
Maximum DTI: 43.00%
Borrower contribution to down payment is no longer required
One year Home Warranty required
For Conditional Commitments issued by RH on or after 10/1/14, the annual fee will increase from .40% to .50%. The upfront fee of 2.0% remains unchanged.
Foreclosure, Deed-in-lieu of foreclosure and preforeclosure sale messages:
Fannie Mae will update Desktop Underwriter® (DU®) Version 9.1 with the changes described below. The changes included in this release will apply to DU Version 9.1 loan casefiles submitted or resubmitted to DU on or after the weekend of August 16, 2014.
CHDAP revises maximum Origination effective 6-2-14.
For loans underwritten on or after June 15, 2014, 2013 tax transcripts must
be obtained. If a borrower has filed an extension, the following must be
*FNMA One Unit Only, Maximum $417,000, owner occupied only with DU/DO approval, borrower is not required to contribute their 5% down payment over 80% LTV/CLTV
· LPMI (Lender Paid)
· Borrower Paid
Effective for FHA case numbers ordered on or after January 1, 2014
Requirements for loans funding on or after December 16, 2013, (copies of extension and last year’s transcripts will no longer be accepted)
LoanSifter will no longer be available for pricing and lock request this Friday, October 18, 2013 after 3PM PST.
New Guidance from FHA on collections, Judgments & disputed accounts
Effective immediately, Essex will require tax returns for all borrowers with income (not applicable to FHA non-qualifying streamlines and VA IRRRL’s) to identify potential 2106 expenses, multiple properties owned and self- employment.
HUD has announced the addition of loss of income as an extenuating circumstance to credit underwriting in certain circumstances for Purchase transactions only, effective for case numbers ordered on or after August 15, 2013 through September 30, 2016. Existing Essex Credit score overlays still apply.
Essex to allow Cosigners in conjunction with FHA & CalHFA loans
For loans underwritten on or after June 15, 2013, 2012 tax transcripts must be obtained. If a borrower has filed an extension, the following must be provided...
“Large Deposit” defined
For Conventional loans run through DU/DO: Any single deposit that exceeds 25% of the total qualifying income must be sourced. If joint borrowers have separate accounts, single deposits that exceed 25% of the individual borrowers gross income must be sourced...
A limited project review will no longer be permitted on principal residences in condominium projects when the LTV/CLTV/HCLTV is greater than 80%. DU will require a full project review on principal residences in condominium projects when the LTV/CLTV/HCLTV is greater than 80%...
RELS Appraisal or RELS Field Review required:
Conforming and High balance Conventional: REO properties require EITHER one RELS appraisal or an approved AMC appraisal PLUS a RELS field review.
For all FHA Streamline Refinance transactions that are refinancing existing FHA loans that were endorsed on or before May 31, 2009, the UFMIP will decrease from 1.0% percent to 0.01% of the base loan amount...
FHA has delayed the portion of these underwriting changes regarding collection accounts ONLY pending additional input and clarification. Case numbers assigned between 4/1-4/8 will not be deemed in violation of HUD requirements if not processed per these guidelines. The change in requirements for self- employed borrowers is effective for case numbers issued on or after 4/1/12