Greetings Hallmark Sales Team!
Below is this week’s upcoming agency changes to guidelines, investor changes and any industry news.
These weekly updates will be posted in the Hallmark Helpdesk in a new folder called “Weekly Underwriting Updates to Sales”
FHA
FHA had announced with the August 14th publication, the "Project Approval for Single Family Condominiums" Final Rule is applicable to both the Home Equity Conversion Mortgage (HECM) and forward mortgage programs. As a result, FHA published Mortgagee Letter (ML) 2019-17, Home Equity Conversion Mortgage (HECM) Program - Condominium Requirements, which outlines the updated origination requirements for HECMs in condominium projects in accordance with the recently published SF Handbook guidance. It also includes certain borrower eligibility requirements for seniors seeking to obtain a HECM for a condominium unit using FHA's Single-Unit Approval process.
FHLMC
Freddie Mac Single-Family is ALL FOR reducing barriers and raising hope. Freddie Mac is expanding the thinking around affordable lending and inspiring others to do the same. With All For HomeSM, we're leading the way through providing insights, education, mortgage products and business solutions that address the needs of today's borrower and of The Borrower of the FutureSM. Rising home prices and interest rates, coupled with a lack of entry-level inventory, are increasing affordability challenges. Demographic and cultural shifts, migrations from rural to urban, first-time homebuyers with thin-credit files and complex processes pose additional barriers to achieving the American dream. It takes collaboration and partnership to innovate solutions that make a positive impact. Learn more about All For Home, discover key insights to inform your business and take advantage of solutions and tools that will enable your borrowers to make Home Possible®. All in. All of us. All For Home.
Coming Soon:
Mortgage eligibility, origination, and underwriting
- Revisions to our requirements for employed income analysis and calculation – April 2, 2020
- Revisions to Employer Assisted Homeownership (EAH) Benefits that are unsecured loans or secured loans
- New Guide Chapter 4305 with requirements specific to purchase transaction Mortgages
- Updates to our requirements for excluding monthly payments on certain student loans from the monthly debt payment-to-income (DTI) ratio – January 2, 2020
- Revisions to our requirements for calculating the monthly housing expense-to-income and DTI ratios – January 2, 2020
FNMA
- Fannie Mae released an MH Advantage® eLearning course that provides an overview of our affordable loan option for manufactured housing, including roles and responsibilities, and explains home criteria for MH Advantage financing eligibility.
- Rental Income Policy Updated
- Fannie Mae recently updated its Title Insurer Requirements - In a June 5, 2019 announcement, Fannie Mae updated section B7-2-02 of the Selling Guide to reflect updates.
- HBC required on the following effective 12.7.19 DU submissions
Homeownership Education Requirements
We believe homeownership education helps borrowers gain essential knowledge to prepare for sustainable homeownership. To that end, we are updating our homeownership education requirements. Currently, our policy requires at least one borrower to complete homebuyer education prior to closing
- if all borrowers on the loan are relying solely on nontraditional credit to qualify, or
- for all HomeReady® purchase transactions.
With this update, at least one borrower must complete homebuyer education for the following transactions:
- if all borrowers on the loan are relying solely on nontraditional credit to qualify, regardless of the loan product or whether the borrowers are first-time home buyers (no change to current requirement);
- HomeReady purchase transactions when all occupying borrowers are first-time homebuyers, regardless of the LTV ratio; or
- purchase transactions with LTV, CLTV, or HCLTV ratios greater than 95% when all borrowers are first-time homebuyers.
In support of our commitment to homebuyer education, beginning October 23, 2019, we will waive the fee for the Framework Homeownership, LLC (Framework®) course for lenders, removing the cost burden for borrowers. Additional information about this is forthcoming.
USDA
Our primary investors are accepting Conditional Commitments - Business as usual during the Fiscal Year shut down
VA
Changes
Chapter 4, Topic 2, Subsection k, page 4-18 has been updated for clarification changing from "and" to "or" in reference of documentation required.
https://benefits.va.gov/warms/pam26_7.asp
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