Lending Announcement: July 9, 2021

Topics in the Announcement

July 9, 2021

• COVID-19 Guidance: Updated!

Please see COVID-19 Guidelines and Product Updates attachment for revised guidance. Highlights include:

• Lifting of minimum score requirement of 640 for FHA manual underwrites
  • Reminder: VDM does not offer manual underwriting for Conventional loans
• Removal of FHA DTI restrictions for credit scores under 640 with AUS Approve/Eligible
• Verbal VOE requirements: clarification that these may be completed within 10 days of closing (20 days for self-employed borrowers)
  • As a reminder: for self-employed borrowers, we will still need to verify that the business is open and active. LARA printouts will not suffice; invoices, verification via phone from someone at the business other than the borrower, etc. must be used to confirm the business is operating currently.

• Update: Minimum Standards for Submission to UW

As discussed in previous Processing Roundtables, we are updating our UW minimum submission requirements. The updates include the following now required documents, for UW submissions (including TBDs), as of 8/1:

• URLA replacing 1003
• Photo ID and SSN documentation for all borrowers
• Patriot Act Information Form completed by LO or LP
• Credit Report valid through ECD for active purchase and refinance transactions
• Non-Borrowing Spouse Credit Report as applicable for loans in Community Property States
• CAIVRS on all government loans
• Manual Underwrite checklists completed and included with submissions

• HOI Order/Reverification Form Updates

In order to insure a smooth transition from Origination/Closing to Servicing, we need to collect and re-verify insurance company payment information for future HOI payments, including phone numbers, fax numbers and payment remittance addresses. We need to have this information on file to aid account set-up with our servicing operations and prevent missed renewal payments as we grow our servicing portfolio.

We have added the information request to our insurance order forms and additional fields on the re-verification forms. We are looking for the processing teams to confirm with the insurance agents the payment info for the companies the new policies are written with. The following forms in Encompass have been updated to reflect this additional information: HOI Insurance Order Form, HOI Insurance Order Form (FL Bond), HOI Final Verification Form.

• eClosings Information

We get a lot of questions and inquiries about eClosings.  There are now four basic versions of eClosings. Each type is distinguished by which closing documents are electronically signed and the type of notarization used. Please see the PDF attachment titled “eClosings” for a full summary of these options.

ICE (Encompass) just released their Hybrid eClose platform through Consumer Connect. We have signed up and are testing the system currently, and should be able to allow borrowers to sign all NON-notarized documents electronically by August.

• Removal of Closing Cost Templates

Closing Cost templates will be removed in the coming weeks and replaced with updated Dynamic Data Management (DDM) fee rules. These expanded DDM rules now include most of the itemization (title fees, surveys, pest inspections, etc.)  and will mimic the functionality of Closing Cost templates but will allow for greater customization of fees and easier maintenance. Once this change is made only the “Generic” closing cost templates will be available for use.

Attached is a spreadsheet of all the allowable fees for the templates. If you would like a custom fee rules created for your branch or would like to duplicate an existing Closing Cost template, please complete the spreadsheet and return to Ryan VanDyk at rvandyk@vandykmortgage.com.

• Homeowner Education Update

Effective immediately, VDM will no longer accept MGIC’s homeownership course. Homebuyer courses provided by MGIC do not fulfill pre-purchase education requirements.

• Brokered File Support

As mentioned in last month’s announcement, Maryann Stanco has come onboard as a member of our Production Support team. Immediately, you can contact Production Support with any questions regarding your brokered files.

In order to ensure better quality and compliance, we will require all Brokered loans to go through a centralized channel within VDM. Beginning 9/1, all registrations and locks for Brokered loans will be handled by Secondary, and all processing of brokered files will be handled by Maryann. Further details for procedures will be published in the August announcement.

• Spanish Translations: LE, CD, URLA & Buyers Guide

Spanish translations of common mortgage documents can now be found in the custom forms within Encompass. Since Encompass does not fully support Spanish disclosures, these documents will not replace any of the disclosures found in our standard English disclosure packages, but should be used as supplemental documentation when an application is taken in Spanish.

The 3 documents are:

1. Spanish LE and CD
2. Spanish Step by Step Mortgage Guide
3. Spanish URLA Borrower Info

Providing these disclosures is optional (in most states) but encouraged whenever they will offer additional understanding to the borrower. However, in CA, OR, DC, or TX if you are taking applications and/or negotiating terms of the loan in Spanish all 3 of these disclosures required to be provided to the borrower at initial disclosure.

We are working to have these Spanish translations documents automatically populate when the Spanish App checkbox on LE Page 0 is checked within Encompass, but until this automation is complete it will be the LOs responsibility to provide these documents when needed.

• Floify Disclosure Update

In the Floify “Disclosures” tab, you will notice a new action icon that will allow you to resend the disclosures email to any parties who have not yet signed their disclosures – even a non-borrowing spouse. This will help when borrowers report not receiving the email (or accidentally deleting it). As a reminder: for a non-borrowing spouse, be sure the borrower has logged out of their Floify account prior to the NBS clicking the link to sign!

• Technology Update: Encompass Enhancements! 

We are excited to share a few more Encompass enhancements that have been implemented.

• Flood Certs: Flood will now automatically order once disclosures have been triggered on a loan.
• ePrint: Now works on 2015 Itemization form.
• Loan Folder Auto Move: This feature will automatically move loans into the correct folder – you will receive a notification when any of the below move rules are triggered:

• Knock Knock: If someone is currently working in a file that you need access to, Knock Knock allows you to send a message to the user who is currently editing the file. From the Pipeline view, right-click on the loan in use and select Knock Knock:

The current user in the file will receive a pop-up message letting them know that someone else needs access to the loan. A message will also be emailed to them in Outlook.

The user may choose one of the pre-set responses and add additional notes if needed. (If they are currently away from their desk and no response is received, the system will automatically close the loan after 15 minutes.)

The user requesting access will receive the selected response back.

Once the file is free, the requesting user will receive a pop-up letting them know the file is available to be open.

• Notes for Encompass: We are upgrading our conversation log!  Notes is accessible anywhere in the file, can stay open while you work in the file, and you can access it from the pipeline view without having to open the file.

You can locate the Notes tab on the right side of your Encompass file. Or, from the Pipeline tab, you can access and create notes without opening the file. Right click on the loan and choose Notes.

Notes will stay open until you click on the Notes tab on the right to collapse it.

Notes has many features. You can Add, Find and Share conversation log entries quickly, copy/paste from any text source, set Alerts for yourself or anyone else, capture your thoughts as they hit you, add to and edit your note before publishing, and easily compare existing notes to current loan data.

Notes writes your message directly to the Encompass Conversation Log as a separate entry.

Notes also appends the following choices to the bottom of the message: Category, SubCategory, To, CC, Subject and Alert.  This allows for easier searching through previous Notes (Conversation Log Entries). However, the Keyword Search will find any note in the Conversation Log that contains the search text.

You can send an email to any person assigned to the file (new – branch managers and Regionals will be auto assigned to files starting 7/9/21). Please add a “Subject” to the loan note to ensure Outlook delivery.

Note: DO NOT email borrowers and other Non-VanDyk Mortgage employees through Notes (or any conversation log) because the required contact and NMLS information does not get added.

Occupancy Type – Why It Matters

Are you aware of the risks associated with loans with an inaccurate occupancy status?

Read Fannie Mae’s Reverification of Occupancy bulletin about the risks of misrepresenting occupancy, along with tips in identifying red flags regarding occupancy status.