Category: Challenges

April 7, 2023

• Tom VanDyk – The Big Follow Up

We are pleased to present an electronic version of Tom’s book “The Big Follow-Up” to every VanDyk employee who is interested in learning how to Start & Maintain New Relationships with Real Estate Agents…And follow up!  The book is available on VDMC.net under our Shared Department Files, in the Sales folder.

• Upcoming HMDA Field Changes

In an effort to improve the accuracy and integrity of our HMDA data, we are implementing new business rules surrounding HMDA fields. Through our partnership with Lender Tool Kit (LTK), they have recommended and implemented a series of rules that will ensure more HMDA information is entered in each file throughout the life of the loan, rather than after the fact.  Moving forward, the government monitoring section must be completed and AUS will be required to be run on all files prior to Submittal milestone completion.  Additional requirements apply to denials – see the attached (HMDA Details March 2023) and reach out to pipelines@vandykmortgage.com for more information or if you have any questions.

• Initial Disclosures: Important Update

Over the past year, we have worked hard on training branches to complete their own initial disclosures. You all have done amazing!!  We have a few branches that are still sending a few files through to our team to complete. Beginning 5/1/23: if you use the Compliance team to send your initial set of disclosures, the branch will incur a $30.00 disclosure fee. Keep in mind that this will be limited to initial disclosures only. Our Compliance team will continue to issue COC’s and CD’s on the branches behalf. Eligible files include any non-bond, non-brokered, initial disclosure that branches can send through disclosure automation (Disclosure Desk).

Branches can continue to initially disclose their own files free of charge via Disclosure Desk. Training and activation in disclosure desk is available upon request so please reach out to Compliance@vandykmortgage.com for help!

• Reverse Mortgage Update: Longbridge Financial, LLC

Candace Nelson, our longtime contact with AAG, has joined Longbridge Financial. We are pleased to announce our new partnership with Longbridge for reverse mortgage lending.  We will be coordinating with Candace in the coming weeks to ensure our in house reverse team is trained on how Longbridge accepts files into Underwriting and all the nuances involved with our new PA relationship.  We look forward to working with Candace and Longbridge Financial as another Reverse Mortgage in house option.

• Minimum Submission URLA Required Milestones
  As reviewed in last month’s Production Round Table, we will be implementing some basic URLA completion requirement rules to ensure files that are being submitted in to underwriting meet our minimum standards.  We are hosting a training on Wed 4/12 for the Production staff prior to going live with these rules Friday 4/14.  Training reference is attached.
• Updated Product Matrices: HomeReady/Home Possible, Fannie Mae Conventional, VA, Buydowns
  Attached find the updated matrices for Fannie Mae Conventional, Fannie Mae HomeReady, Freddie Mac Home Possible, VA Fixed Rate, and Buydowns.
• Post-Closing Quality Control – How can you help?

With the recent changes to the 4506C requirements, we are seeing more frequent rejections from the IRS on our transcript orders.  If you can verify the most recent tax filing address and fill in your 4506C to match this will greatly help reduce those rejections.  See the attached QC Update PDF for additional details and thank you for your help!

• Condo Fees: Paying Up Front
  If a borrower is paying for any condo fees prior to closing, be sure there is an invoice from the Condo department to match what is being charged prior to sending the form to accounting. *The VanDyk Condo Department Processing Fee $150 CANNOT be charged prior to closing – ONLY 3rd party fees*
• CALHFA – Dream For All Shared Appreciation Program Update
  CalHFA anticipates that all funds currently available for the Dream For All Shared Appreciation Loan Program could be fully committed as soon as April 10, 2023. However, all loans must be rate locked no later than 4 p.m. EST on April 12, 2023, or when the available funds become fully committed, whichever is sooner. Loan files that do not have rate locks by that time will not be funded.
• Compliance and Production Support: Ticketing System Update
  Starting Monday, April 10: emails sent to Compliance@vandykmortgage.com and ProductionSupport@vandykmortgage.com will be switching to the same ticketing system utilized by AskUW@vandykmortgage.com. You won’t notice a major difference when emailing these teams, but this change helps us to better track the questions that we receive and to provide training opportunities based on the “hot topics” that are asked about.
• Winnow
  We are replacing AllRegs with a new service that includes state specific searchable resources and reference charts.  Your credentials will be issued in the coming days (coming from support@winnow.law) and we will provide you with a calendar invite for training soon.  When you can access the website, you may see a message about unwanted content.  You are OK to Ignore and Continue past this message for this website:

• Essex DPA: LO Training
  Essex/NHF DPA will be holding another training session for LOs to learn more about their program – additional details available here. Training will be Tuesday, April 11 at 2pm Eastern – invitation is attached.
• PS Processing: Resource Folder
  Mary Spirou, our new Production Support Processing Manager, has been sharing helpful guides in our Production Support Processing folder. You’ll find processing checklists for several programs and other useful information – check it out today!
• Quality Matters: Learn About Appraisal Defects
  Fannie Mae, Freddie Mac and investors are all scrutinizing appraisals more and more during post purchase quality control reviews and audits.  See the attached Appraisals – Quality Matters and FNMA Top 5 Appraisal Defects for more information on how we are working to reduce or eliminate the risk for repurchase or indemnification of these loans.
• Coming Soon: VDM Shared Calendar
  Feeling left out?  Want to check and see what awesome meetings and trainings are on deck for the month?  Missing a Zoom link?  Coming soon, we’ll have a new SHARED CALENDAR LINK on VDMC.net!  You can add invitations from this calendar to your own – no more fear of missing out! Be on the lookout for an official announcement once available.

 

Agency Updates

Fannie Mae

• Fannie Mae is updating the Selling Guide to no longer require that Medical Collections to be paid off at or prior to closing in cases where a collection is required to be paid off.  Fannie Mae has also added an additional section to the Selling Guide where a borrower is a Real Estate Agent and using Earned Commissions for closing.
• Beginning the weekend of April 15, casefiles submitted or resubmitted will have updated terminology for Appraisal Waivers.  You will now see the term “Value Acceptance” used in conjunction with the term “appraisal waiver”.  This will also be updated as part of Fannie’s offering for Property Data Collection.  See the attached DU Release Notes Version 11.1 April Update for all DU messaging updates.

Freddie Mac

• In last month’s News, we released that Freddie Mac had done away with all COVID-19 overlays. Here are FAQs direct from Freddie Mac in relation to that update: Retirement of Bulletin 2020-17, Selling Guidance Related to COVID-19.
• Freddie Mac is following suit with Fannie Mae and issuing Appraisal Flexibilities for New Construction properties where the appraisal is completed “subject to completion per plans and specs”.  Form 400 Warranty of Completion of Construction Guide Form 400 (freddiemac.com) can now be used in conjunction with the photographs named below in lieu of a Final Appraisal Inspection.

 

VA

• Per last month’s VDM News, the VA Funding Fee has been updated. The VA matrix has also been updated to reflect this change and is attached.

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Upcoming Events and Reminders

If you need an invitation to one of the Zoom meetings listed below, please respond to this message or email ProductionSupport@vandykmortgage.com

• Deal Desk: Loan Save with Dave: Every Tuesday/Thursday at 1pm Eastern
• URLA Completion – Submission into UW: Wednesday, April 12^th at 3:30pm Eastern.
• VanDyk Mortgage Newscast: Friday, April 14^th @ 1pm Eastern
• Iron Sharpens Iron: Tuesday, April 18^th at 11am Eastern
• In House Bank Statement/DSCR & Binge on Brokering Refresher Training: Tuesday, April 25^th at 2pm Eastern
• Production Roundtable: Tuesday, April 26^th @ 1pm Eastern – National Static Cling Day

 

Florida FYI: FL Anti Coercion Disclosure

Florida teams will need to make sure the FL Anti Coercion disclosure is completed in its entirety.
This form requires borrower input: if the borrower does not have HOI at the time initials are signed, they will need to input “TBD” when eSigning the form.

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2022 Tax Return Deadline

REMINDER!  April 18, 2023 is the IRS Tax Deadline for filing 2022 Tax Return.  Please refer to the Tax Return and Transcripts Cheat Sheet and be sure to double check your loans where Tax Returns are required.

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Reminder: Debts Paid at Closing

When we’re paying off debts at closing – we need the address to send those payments to.
We must have a most recent statement for any revolving debt. In the case of non-revolving debt (mortgage, installment, etc.), we need an actual payoff good through funding, reflecting the address of where to send the payment.

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Mortgage Insurance Quotes + Loan Changes

Did you know you should re-quote MI if your DTI, LTV, FICO or number of borrower’s change?
We recommend reviewing the MI quote/refreshing your MI at Submittal, lock, appraisal received, resubmittal, if there is a program change… or if any of the loan qualifying parameters change.

It doesn’t hurt to check!

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Tax Transcript Years

To help you in the initial processing of the file and VanDyk in the final servicing / transfer of the loan to the end investor, we default a few different options for the 4506-C per borrower to eliminate the need for you to have to go back to the borrower and obtain additional forms later. These defaults will be updated based on the tax years that are applicable at application date.

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USDA Help Desk

Did you know AskUSDA is available for your USDA questions? You can reach AskUSDA by phone at (833) ONE-USDA with representatives available 9:00 am – 5:30pm EST weekdays.
The website https://ask.usda.gov/  is available 24/7 and includes live chat agents available 10:00am-6:00pm EST on weekdays. Inquiries can also be sent via email at any time to askusda@usda.gov

As a reminder, please include any scenario responses from USDA with your UW Cover Letter.

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aiUW – Minimum Requirements and Best Practices

In the March Production Round Table, we reviewed some best practices for running aiUW. Check out the recording and notes here, but as a reminder:

Run aiUW once docs are bucketed, AUS has been run, and the basic file structure has been set. This will determine income/credit/assets/property conditions (import ALL conditions!)

Review conditions – ALL conditions, every time! (Tip: sort by added on date to identify new conditions)

Assign applicable buckets to the condition it should be matched to (for aiUW items OR items added by UW)

Mark conditions as fulfilled if you have the documentation to satisfy. (Create comments to UW if you’re missing docs, or if the condition doesn’t apply/should be waived – and why!)

Re-run aiUW before submitting for initial UW and repeat above steps as applicable.

Re-run aiUW when appraisal is received.

Re-run aiUW if loan program/type is changed.

 

25 Points

January 6, 2023

• Howee’s Helpful Tips 

Have you seen Lindsey Kuhnle’s DYK posts in the VanDyk Happenings Facebook group yet? If you missed them, we’ve created a Howee’s Helpful Tips blog category at VDMC.net to collect all of the knowledge that is shared. Check it out!

• Brokered Loans Update and Reminders:

QC Review Process:  Effective Jan 1, non-government brokered loans will be reviewed by Production Support for completeness.  The QC department will continue to review government loans.  Files should be moved to the resubmittal milestone only when the loan has closed and funded, and the entire closing package with all loan documents, approvals and a copy of the broker check have been uploaded to the Encompass file.

REMN HELOC:  Although the borrower completes the application for this loan with REMN via their website, VanDyk requires an Encompass file and secondary approval to broker like any other loan.  Be sure to follow the normal procedure to obtain approval to broker this product or any other loan.

QUESTIONS, SUPPORT & TRAINING:  As a reminder, please reach out to Production Support for any broker questions – we are also able to provide training at a branch level for specific broker processes.

• Jumbo Loan Review Updates    

With aggressive interest rates, we have determined there is a need for a more relaxed review to lock our JUMBO customers into their interest rate more quickly.  Upon request to the JUMBO Team for approval to lock, we will be doing a scrub to verify that the loan appears to meet the specific jumbo investors requirements.  This will not be a full review or approval of the loan file, only the approval to lock, and any areas of concerns will be expressed.  The loan will not be fully underwritten until it is submitted into underwriting.
As a reminder, we must underwrite to our specific JUMBO investors guidelines and overlays.
Email: JumboLoanReview@vandykmortgage.com

 

• Commission Earned Policy Reminder

With many economists predicting that we could see a refinance market in the next 8-16 months, we wanted to remind every one of our commissions earned policy (Early Payoff). Please see the attached for a refresher on the policy. We do have a pipeline view in Encompass called “Recapture Pipeline” that is available for LOs to search loans and get an estimate for when a particular loan is in the clear.  If you have a situation where you might be close on recapture or just want a further look at the scenario, reach out to secondary and they can dive deeper into the exact loan scenario and investor policies to ensure we have an exact date.

• Chenoa Fund Updates  

Chenoa has made the following update, effective January 1, 2023. Matrix and updated guide are attached.

• Payment Shock Requirements: For Borrowers exceeding the 125% payment shock or where the Borrower has no prior housing expense, the new maximum DTI is 45%.  Sections 5.11 DTI Requirements, 5.12 Payment Shock Requirements, and 6 Manufactured Housing were impacted by this update.

• AMI/LLPA Announcement from Secondary

On December 23rd Secondary put out the attached “FHFA Updates in Optimal Blue.” If you missed it, please read! If a borrower meets the below two requirements on a Conventional transaction they are eligible for no LLPA’s.

• At least one borrower on the loan is a first-time homebuyer.
• The total qualifying income is less than or equal to 100% of the AMI, or less than or equal to 120% of the AMI in a designated High-Cost Area.

 

• MSHDA – Tax Return Update

Effective January 1, 2023, MSHDA will require federal returns for tax years 2020, 2021 and 2022 on all new MCC submissions. The completed MCC-004 Income Tax Affidavit is to be submitted in place of the 2022 federal tax return up until February 15, 2023.  After February 15, 2023, the 2022 federal tax return is required to be submitted with every MCC file before a Commitment can be issued. This applies only to the Mortgage Credit Certificate (MCC) program.

• Manufactured Home – Title Order Form    

A new Title Request Form for Manufactured Homes is now available in Encompass. This form gives additional guidance to Title Companies on what will be needed for us to close on a manufactured home. Please use this form for all title orders on Manufactured Homes.

• Borrower Summary – Form Update to 2023!

The Encompass input form Borrower Summary – 2021 will soon be replaced with an updated version, Borrower Summary – 2023. It will feature new fields for the Credits and Adjustments as well as an updated second input form (Page 2) for disclosure questions and fee rule overrides.

The form update will effective 1/16/23. Trainings on the new form will be provided before and after the change.

• New DPA Coming Soon: CALHFA

We have been approved with CALHFA but must undergo extensive training before they will allow us to originate. If you plan to originate CALHFA loans, please register for Part 1 and 2 of Sales and Ops training using the links below. We will issue another announcement once we are fully ready for launch.

• • Part 1: Registration (gotowebinar.com)
  • Part 2: Registration (gotowebinar.com)

• Market Update: Brad Chatel

Don’t miss the Newscast on Friday, 1/13 – Brad, our VP of Secondary and Capital Markets, will be joining us to recap his 2022 year-end commentary. He’ll also share any updates that have arisen since. If you missed the commentary, find the email attached!

 

Agency Updates

• VA: While this isn’t an update from VA, we wanted to pass along a reminder to log in to your LGY Hub account at least once every 90 calendar days.  Starting January 10, 2023 and onward, all LGY Hub user accounts will be deactivated if they have been inactive more than 90 days.

Upcoming Events and Reminders

If you need an invitation to one of the Zoom meetings listed below, please respond to this message or email ProductionSupport@vandykmortgage.com

• Iron Sharpens Iron: Tuesday, January 17 @ 11am Eastern
• VanDyk Mortgage Newscast: Friday, January 13 @ 1pm Eastern
• Production Roundtable: Tuesday, January 24 @ 2pm Eastern

 

35^th Anniversary Events

March 2 – 4, 2023 | Annual Sales Fly-in

VDM Newscast Dates

Just a reminder that the VanDyk Mortgage Newscast will be held on the second Friday of each month for 2023.

Invitations were sent in December, please let Production Support know if you need it re-sent!

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Reminder: Self-Employment and Rental Income Support Team

As a reminder, the Self-Employment / Rental Income Support Team is not designated for JUMBO loans.
Please continue to submit all jumbo loans through the Jumbo Loan Review Team at jumboloanreview@vandykmortgage.com.
Instructions for requesting support are attached.

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Video Portal

Did you miss an Iron Sharpens Iron or a Newscast? Don’t worry – those recordings are available on VDMTube here!

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Product Matrices

You can find our VanDyk Mortgage product matrices by asking Howee, or by going directly to the Shared Files – in the Product Matrices folder.

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Sales Fly-In – RSVP Reminder

Our 2023 Sales Fly-In is March 2nd – March 4th! If you already RSVP’d, thank you! If you haven’t and plan on attending, what are you waiting for?!

RSVP today: https://2023-VDM-Sales-Flyin.eventbrite.com

25 Points

December 15, 2022

• 2023 Loan Limits Update
  FHA Loan limits updated to $472,030. Please keep in mind that the maximum loan limit is determined by the effective date of your case number, and the new loan limits can only be used for case number assignments on or after 1/1/2023. If you have an FHA loan already in process, and the case number has already been assigned, you cannot increase the loan amount to the new limits.

Conventional loan limits updated to $726,200. DU and LPA are already updated to accept these values. Loans can close immediately with these values but the lock must be good through 1/2/2023.

Optimal Blue is updated to accept the new loan limits for both FHA and Conventional immediately.

 

• Chase Community Lending: Update 

Last month we announced the new Chase Community Lending program. To clarify additional details: the loan won’t be sent to Chase for underwriting until it’s been locked. In addition, the loan program won’t reflect as Chase Community Lending until the lock has been confirmed, so it is IMPERATIVE that your intention to submit the file to Chase be communicated to your processor.  Your Processor will need to specify on their UW Cover Letter the loan is being sent to Chase (if it’s not already locked at initial UW). As long as this is communicated, one of our amazing underwriters will pre-scrub the file against the Chase guidelines to catch any potential issues up front.

• Appraisal Orders: Chase has a naughty list and will not accept appraisals completed by someone who has been included.  If the appraisal is ordered prior to lock, please add a comment to the appraisal order that the loan is being sent to Chase so the appraisal department can assign the order to someone who is acceptable to the lender
• Overlays: There are additional overlays for this program, please review here (they are also available by asking Howee about Chase Community Lending)

 

• New Jumbo Outlet: Citi Bank    

We are pleased to add Citi Bank as a Jumbo outlet. Attached please find our updated Jumbo Comparison sheet and some facts about the Citi Program. These jumbo loans can now be priced in Optimal Blue. Please remember to email JumboLoanReview@vandykmortgage.com to have our Jumbo team review these loans prior to locking.

 

• Kentucky Housing 
  Starting Monday, December 19th, Kentucky Housing loans can be originated. When originating these loans, please make sure that the correct loan program template is selected in Encompass.

In order to lock, please review the KHC Reservation guide attached. Also attached is the KHC bond request form that needs to be submitted to secondary by 4:30pm EST to lock same day.

Normal and customary fees can be charged on the loan (Processing and UW). A $175 admin fee and $595 UW fee must be charged to the customer as these are all program fees.  The 2nd mortgage must have fees of $50 doc prep fee and $80 recording.

On the backend, the branch will make the .25% and must charge 1.5% in origination for FHA, Conventional, and USDA loans. On VA Loans no origination can be charged, and the branch will make 1.75% on the backend. Please make sure that you verify your P&L can support the pay structure of this program prior to originating.

 

• Compliance/Closing Updates: Disclosures, eClose, and Fundings.
  • Compliance – We are continuing to roll out Initial Disclosures to our branches. We happy to announce we will begin Beta Testing COCs and Initial CDs as early as next week.
  • Closing
    • Closing Request VDMC: – Please remember to complete this form when a closing date is known. This form communicates how you would like your file to close and will expedite the closing of your loan. Reminder, you do NOT have to be CTC!
    • Hybrids: – Communication is Key! Please confirm with all parties they are aware you plan to close as Hybrid (settlement agent included).
    • Funding: – Closers and Funders are working together to offer the best funding experience possible!
      • Hybrids – Reduced Funding Checklist.
      • Traditional – Full Package Review.

 

• Post-Closing Quality Control – How can you help?

With the recent changes to the 4506C requirements, we are seeing more frequent rejections from the IRS on our transcript orders.  If you can verify the most recent tax filing address and fill in your 4506C to match this will greatly help reduce those rejections.  See the attached QC Update PDF for additional details and thank you for your help!

 

• SimpleNexus – Partner Landing Page    

We are excited about the improved feature for your Partners to create their own SN account!    Our awesome Marketing department is working diligently on adding your individual LO Landing page links to your existing accounts.

Find the link to share with your partners under Contacts > Partners. Remember: If the agent is also a borrower, make sure they use a different email than the one they used for their personal loan!

• Income Worksheet: Updated  

In Encompass, the Income Worksheet – LTK form has been updated to a newer version. An example of the worksheet is attached.

 

• Company HELOC Commission Policy 

We have revised our 2^nd mortgage HELOC policy to allow individual LO compensation.  Closed end fixed rate seconds are still not eligible for LO comp, however, the open-ended stand-alone HELOC loans are now eligible.  If you utilize the company’s processing team, the fee is reduced from $695 to $495 for these stand-alone 2nds.  Additional details are attached.

 

• Broker Partner Updates

New Partner- REMN:  We are pleased to offer a new broker partnership with REMN and are looking forward to their EXCELLENT LO and Borrower hand-holding experience with the 203k and HomeStyle product offerings.  REMN will provide 203H options as well.  Additionally, we are DELIGHTED to announce that REMN has a stand-alone HELOC 5-day close product.  Production Support will coordinate training, so watch for the invitations coming soon!

Union Savings Bank – RESTRICTED: We continue to experience hardships with Union Savings and have determined a restriction in business operations is necessary.  With the constant revision in how they conduct themselves (from the initial disclosure process through underwriting submission and changing loan approval terms and decision last minute) Effective Monday, 12/19/22, Union Savings Bank brokered loan requests will include a more in-depth review process to ensure the loan officer understands the risk involved.

• • As a point of interest, Union Savings Bank has clarified their lending footprint and confirmed full LTVs are only available in OH, KY, IN, PA, and FL.  Other states are subject to reduced LTV and/or other restrictions.  There are some areas in MI, MN, and IL where the full LTV is available.  Union Savings does not lend in TX, AZ, CO, or NM.  Updated Submission, Closing and other information for this lender has been uploaded to Howee

• Pipelines Update

Pipeline Management: With the start of the new year upon us, we will be rolling out new Pipeline Management policies. As you may be aware, we are looking to have clean and accurate pipelines moving forward. This will assist us in not only accurately forecasting our internal revenue, but also ensure we are staffed properly to meet the necessary accommodations regarding closings and other operational procedures. In addition, we will be providing extra support regarding the loan process, should a loan stall for a myriad of circumstances we will be reaching out to see if the issue can be elevated to a senior manager to see if a solution can be found. Our ultimate goal is to close as many loans as possible!

ECOA: Changes are coming to the LSN/Notice of Incompleteness procedure. This will be a more automated process to ensure our compliance and fulfillment, though it won’t be intrusive to the way we do business. We are hosting a training for this new process next week – watch your inbox for an invitation!

 

• UW Submission Standards: Reminder  

As a reminder, the updated Underwriting Standards Checklist should be utilized for your new submissions. This new checklist includes the new requirements for running aiUW on all files and the use of the Underwriting Cover Letter. The updated standards are attached. If you missed the recent aiUW training call, you can review it here

 

• Reminder: Brokered Loan Folder  

Effective December 1, a new pipeline folder is being utilized to house our Brokered Loans. This folder will help ensure better file flow through underwriting and help us to efficiently monitor our in-house closings for the month. Once your file is approved for brokering, Production Support will move the file into the new Brokered Loans folder from Prospects. Upon completion, the file will be moved from the Brokered Loans folder into the Closed Loan folder.

 

Agency Updates

• Fannie Mae Highlights

1. Removal of 10 Year Age Limit on Single-Wide Manufactured Homes – Single-Wide Manufactured Homes are now eligible so long as the unit was manufactured on or after June 15, 1976, which aligns with the age limit of other manufactured home products.  Updated Matrix Attached.
2. Temporary Leave Income – Mandatory Leave initiated by an employer, such as a furlough, is not considered temporary leave.  In addition, Fannie Mae has clarified that income resulting from a furlough, layoff, or other employer-initiated action is not eligible to be used as qualifying income unless it is associated with seasonal employment.
3. Use of Business Assets – If self-employment income is not being used to qualify for the loan but the borrower is using assets from their business towards down payment, closing costs, or reserves, there is no requirement to perform a cash-flow analysis.  We must however verify that the borrower listed as an owner of the account and the account is verified in accordance with Selling Guide B3-4.2-01, Verification of Deposits and Assets.
4. Gift Letters – Gift Letters can now show the actual or the maximum dollar amount of the gift.  In addition, the Gift Letter no longer requires the specified date the funds were transferred.
5. Property, flood, and project insurance updates – Due to the extensive updates, please review attached Selling Guide Announcement indicating the sections of the Fannie Mae Selling Guide that have been impacted.

• Freddie Mac Highlights

1. Freddie Mac Bulletin 2022-24 – Update to ACE+PDR requirements that were announced in Bulleting 2022-13 in June of 2022.
2. Freddie Mac Bulletin 2022-25
   1. IMPORTANT!!!  COMING ON AND AFTER MARCH 7, 2023 – Cash-Out Seasoning is being updated to at least 12 months between the Note Date of the Mortgage being refinanced and the Note Date of the new cash-out refinance Mortgage).  Excluded from this guidance are special purpose cash-out refinance Mortgages that meet the requirements in Section 4301.6 or if the First Lien Mortgage being refinance is a HELOC.
   2. Freddie Mac has now included in their definition of “Related Person” to include unrelated individuals with close, family-like ties to the Borrower.  This expands on eligible gift donors as well as flexibilities to other guide sections.
   3. Gift Funds – In addition to expanding on the definition of “Related Persons”, Freddie Mac is now allowing a trust established by a Related Person and an estate of a Related Person to be eligible donors of gifted funds.
   4. Contingent Liabilities – Property-related expenses such as taxes, insurance, HOA dues, etc, may now be excluded from the DTI ratio when documentation in the Mortgage file confirms that a party other than the Borrower has been making timely payments for the most recent 12 months and the party making the payments is not an interested party to the transaction.
   5. Temporary Leave Income – Freddie Mac is aligning with Fannie Mae to state that employer-initiated actions such as furloughs and layoffs are not considered temporary leave where income can be considered.

• FHA: ML 2022-18 – FHA is now accepting Private Flood Insurance effective December 21, 2022!  Please review the attached Mortgagee Letter for requirements that will be updated in the 4000.1 Handbook.

 

• VA: GREAT NEWS!!!  Effective as of November 26, 2022, an ongoing maintenance agreement from an HOA of a joint maintenance agreement from the owners of properties accessed by a private road or shared driveway is no longer required.  The following actions will be taken on these properties:

• • A recorded permanent easement or recorded right-of-way from the property to a public road is still required to be placed in the loan file.
  • Item 5 of the Notice of Value (NOV) will no longer be marked as item 5 of the NOV since it no longer applies.

• USDA

USDA has announced UPCOMING revisions to Chapters 9 and 15 of the USDA Handbook 3555.  These are anticipated to be implemented in January 2023.  The updates are extensive and EXCITING so we have attached the full Procedure Notice as well as a much clearer Highlight.  Our favorite update is regarding sourcing deposits:  We will no longer be required to source and explain EVERY non-payroll deposit.  USDA is loosening up the requirement to only need to source recurring deposits as well as non-recurring deposits greater than $1,000.

Upcoming Events and Reminders

If you need an invitation to one of the Zoom meetings listed below, please respond to this message or email ProductionSupport@vandykmortgage.com

• Iron Sharpens Iron: Tuesday, December 20 @ 11am Eastern
• VanDyk Mortgage Newscast: Friday, December 16 @ 1:30pm Eastern
• Production Roundtable: Thursday, December 22 @ 3pm Eastern (You don’t want to miss it! Teaser: “Your mom goes to college…”)
• ECOA Update Training: Monday, December 19 @ 2pm Eastern (Invites will be emailed Friday)

 

Idaho Housing and Finance Association: Homebuyer Education

Please note that Idaho HFA does not accept Fannie Mae HomeView for homebuyer education – they will accept the Finally Home course.

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4506-C Form Changes

As a reminder: As we receive feedback from DataVerify, Encompass will be updated to accommodate changes that come across for the 4506-C form.

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TBDs/Files on Hold – Move your ECDs!

Reminder: for any TBD or file on hold with an ECD of 12/31/22 in Encompass, please push it to 12/31/2023. IT has added in the first payment dates in Encompass through July 2024

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Combining Buydown Programs and DPA

Please be advised that buydown programs are unable to be combined with certain DPAs. For example, Essex DPA will not allow a buydown.
Check with your underwriter or AskUW@vandykmortgage.com to confirm.

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Reminder-Appraisal Delivery – Just need one

FYI, we need appraisal delivery confirmation from only ONE person involved in the transaction. If the subject is a primary residence, the appraisal delivery needs to be delivered to a borrower who will occupy as their primary. If it is a VA loan, it must be delivered to the veteran. If the subject is a second home or investment, the delivery confirmation can be from any person on the loan. The delivery confirmation received from ValueLink showing the report was delivered is sufficient.

Alternately, an email to the borrower showing the report was sent will work (if you send to the email address, we have eConsent for) or the report is delivered via SimpleNexus and proof of delivery uploaded.

***

VanDyk Happenings – Did You Know?

Keep an eye out for Did You Knows to be posted in the VanDyk Happenings Facebook group – Lindsey will frequently be posting helpful information!

 

25 Points

November 15, 2022

• Ops Fly-In – Recordings Available

If you were unable to attend the first ever Ops Fly-in, or you were there and want a second look at some of the presentations, you are in luck! Visit https://www.vandykopsflyin.com/videos.html to view recordings from both days.

• Chase Community Lending Program

We are happy to announce that we have partnered with Chase Bank to offer improved pricing and rates in underserved areas of the country. When you run pricing, Optimal Blue will use the address, zip code, State, and county to determine if the address fits into its community lending program. If the product is in an eligible census tract you will see a loan program that contains “Chase Community Lending” in the name.

This program will be underwritten by Chase, so please take that into consideration when locking and plan for the extra time needed to obtain the conditional and final underwriting approvals from the lender (Amber will handle submitting the file to the lender and applicable conditions will be added into Encompass – there will be no difference in how processing submits or re-submits these files into underwriting).  Eligible products are Conventional 30 Year Fixed, HomeReady 30 Year Fixed, and HomePossible 30 Year Fixed. Attached are chase Community lending guidelines and Chase overlay guides.

 

• FHFA – Loan Level Adjuster Updates

On October 24, 2022, the Federal Housing Finance Agency (FHFA) announced changes to Fannie Mae and Freddie Mac’s guarantee fee pricing by eliminating upfront fees for certain borrowers as well as affordable mortgage products. They also announced targeted increases to the upfront fees for most cash-out refinance loans. Fannie Mae and Freddie Mac have both issued lender letters of the changes.

• • Effective with loans locked November 7^th and after: LLPA’s have been waived on all HomeReady and HomePossible loans. This removes the Fee caps that used to apply on this products.
  • Effective with loans locked December 1^st and after: LLPA changes to C/O refinance loans will be effective. Any C/O locked prior to 12/1/2022 must fund by January 13^th in order to avoid increased loan level adjusters. Attached are the changes to C/O adjusters.

We are working diligently with Optimal Blue and Encompass to implement other changes mandated by FHFA. No changes were made to AMI requirements for HomeReady and HomePossible. We will have further updates when they are available.

 

• New DPA Option: NHF/Essex

We are excited to share a new Nationwide DPA option! This program will be priced through Optimal Blue. There is a training for Loan Originators scheduled on Tuesday, November 29 at 1pm – invitation is attached, titled “invite.ics” – or email Production Support to have it sent to you.

• • 3.5% of Purchase Price or Appraised Value, lesser of the two.
  • Available in 46 states (except Kentucky, Massachusetts, New York, and Washington)
  • Highlights: 600 min FICO, no First time homebuyer requirement, FHA only, AMI up to 160%, forgivable and amortized 2^nd options, and normal/customary fees (Discount/origination max of 2%).

 

• Massachusetts Housing: No Longer DPA Partner

We are no longer approved with Mass Housing. Mass Housing has volume requirements and we were unable to meet those requirements. Termination is effective immediately.

 

• DSCR – Now Available In House!

We are pleased to offer a Retail solution for DSCR loans through Bayview.  These loans will be a hybrid process for underwriting and closing where Bayview will do the underwrite and VDM will handle the closing. Offering a Retail option will provide more pricing and guidelines options to our borrowers.

• • Prepay Penalty not allowed in: AK, IL, MD, MI, MN, NJ, NM, NC, OH, PA, RI, VA. Blanket option is not available.

Any questions can be directed to nonQM@vandykmortgage.com. Please refer to the attached Pricing Guide for tips on pricing these loans in Optimal Blue.

 

• Exciting Updates to Closing and Funding!
  • Updated Funding procedure for Hybrid eClose:

Starting 12/1/22, Closers will be issuing funding authorization on their own Hybrid eClosings. We have also consolidated the funding review conditions for Hybrid eClosing, allowing for a faster, easier, and more efficient funding review.

 

• • Hybrid eClosing – Default closing option:

Closing will be defaulting to Hybrid eClosings on eligible files if no closing method is specified. Traditional wet sign closings will still be available but must be specifically requested when filling out your Closing Request.

 

• Same Day UW

With the delay in the auto-notification from Encompass for Same Day UW Review, we are requesting that if your loan is being resubmitted within 1 business day of your closing date, an email is submitted to the assigned Underwriter on the loan file and copying the Regional Underwriting Manager to notify them of the request for Same Day UW Review.  Thank you for your patience while we continue to test our systems.

 

• Broker Partner Updates

New Partner- FNBA:  We are pleased to offer a new broker partnership with First National Bank of America.  FNBA lends in all 50 states and their service levels with the ITIN programs offered look to be higher than our current offerings.  We will send out more information about this exciting development soon!

Spring EQ-Increase in compensation:  Spring EQ has increased the compensation from 2.0 to 2.5% for their open-ended HELOCs when you select borrower paid.  Lender paid and fixed rate HELOAN / closed end compensation remains unchanged. 2% minimum must be charged on every Spring EQ transaction.  At this time, the compensation is paid to the branch and not the LO.

• TBDs/Files on Hold – Move your ECDs!

Reminder: for any TBD or file on hold with an ECD of 12/31/22 in Encompass, please push it to 12/31/2023. IT has added in the first payment dates in Encompass through July 2024.

 

• Updated Product Matrices – Attached
  • High Balance: Our High Balance Matrix has been updated in its entirety for Conventional and FHA programs and VA High Balance has been added.
  • VA: The VA matrix has been updated to reflect a minimum FICO of 580 for Manufactured Homes.
  • FHA: The FHA matrix has been updated to allow for manual UWs on the 203(h) program, and added clarification regarding ineligible AUS findings.

 

• WVOE Cheat Sheet

A new Written Verification of Employment Cheat Sheet is attached for your reference.

 

• AMI: What Is It? How Do I Find It?

The Area Median Income (AMI) Lookup Tool provides lenders with a quick and easy way to look up income eligibility by area, property address, or FIPS code. Here’s a link to Fannie’s AMI tool and Freddie’s tool!

• AccountChek as a Compensating Factor

Just a reminder that the AccountChek report fee charged to the branch is $18 for a 60-day w/ refresh or $21 for a 90-day w/ refresh.  There is no charge if results are not delivered.  AUS will be able to pick up a 12-month rental history if one is present – a separate VOR order is not required.

FREDDIE MAC has introduced positive cash flow as an additional compensating factor when AccountChek is used.  This means your Caution LPA result could flip to an accept if you pull an AccountChek and the results reflect the borrower’s running balances and deposits/accounts are healthy and demonstrate smart money management.  Adding additional accounts can help to strengthen the scenario.

• Encompass Submittal/Resubmittal Emails – Disabled  

In our effort to make Encompass run more efficiently, we have disabled the automated email notifications upon loan submittal, resubmittal, and other milestones. If you would like assittance setting up a pipeline view to see your milestone status at a glance, please email Production Support.

• Condo Fees

Effective immediately, we are forgoing the use of InterIsland for review on established Condo Projects.  Our Condo Team has worked closely with InterIsland over the past 6 months to help absorb the heavy volume and move in a forward direction.  With this change, the InterIsland Fee will no longer be charged.  The Condo Processing Fee of $150 as well as any third-party fees for documents will still be invoiced.  We will continue to send New Construction Projects to InterIsland as they always have and invoice accordingly.  We look forward to continuing to serve our Condominium customers.

Agency Updates

• Freddie Mac

Loan Product Advisor Enhancement – Use of a Borrower’s cash flow in its credit assessment

• LPA will now assess the Borrower’s cash-flow of deposits, monthly bills, and day-to-day transactions.  If positive cash-flow is identified in the account data, it may impact the credit assessment by upgrading a loan’s Risk Class from Caution to Accept.  To use this enhancement, the following requirements must be met:
  • At least on Borrower on the transaction must have a usable Credit Score as determined by Loan Product Advisor, AND
  • At least 12 months of account data must be transmitted to Loan Product Advisor

Credit Card Reward Points as a Source of Funds: Credit Card Reward Points are not an eligible source of funds to qualify the Borrower when the points are redeemed for cash.  Documentation requirements when the funds are not yet deposited in the Borrower’s account is as follows:

• Evidence of the Borrower’s ownership of the reward points and their cash value, AND
• Evidence the reward points are redeemed for cash prior to closing, which may include a direct transfer of the cash to the settlement or closing agent.

Upcoming Events and Reminders

If you need an invitation to one of the Zoom meetings listed below, please respond to this message or email ProductionSupport@vandykmortgage.com

PLUS: Bonus Training Feast Leftovers!

• aiUW Refresher: Wednesday, 11/30/22 @ 2pm Eastern
• SimpleNexus Refresher: Thursday, 12/1/22 @ 2pm Eastern

Total Expert – Training Sessions for new CRM (LOs: you only need to attend one session per class)

Creating Business Growth

• Wednesday, November 16^th, 9:30 am – 11:00 am CT https://totalexpert.zoom.us/webinar/register/WN_0CV05RuRT4qRyamcwEsAOA
• Thursday, November 17^th, 11:00 am – 12:30 pm CT https://totalexpert.zoom.us/webinar/register/WN_wpA-4kGBR-aKhkP93t3BWg
• Friday, November 18^th, 11:00 am – 12:30 pm CT https://totalexpert.zoom.us/webinar/register/WN_uqf11RNwQiqLhjrG7vYuow

Q&A For Loan Officers

• Wednesday, November 30^th, 10:00 am – 11:00 am CT https://totalexpert.zoom.us/webinar/register/WN_OncSOMj1Ryi-_JtNDl9-Qg
• Thursday, December 1^st, 12:00 pm – 1:00 pm CT https://totalexpert.zoom.us/webinar/register/WN_cxis6cT4R_2VCyBS69cqEQ
• Friday, December 2^nd, 10:00 am – 11:00 am CT https://totalexpert.zoom.us/webinar/register/WN_2dFSMKSYR0GkSfXj1D1OEg

 

35^th Anniversary Events

March 2 – 4, 2023 | Annual Sales Fly-in

VA Final Inspection Reports

If you are not getting the VA notification email for an upload to the VA portal, this is because once the NOV is issued the VA email notifications stop going out.

Please check the VA Portal for your report listed under Repair Inspection or please send an email to Amber Workman to check on it for you.

***

Buydowns: FHA ADP Code

When ordering your FHA Case Number Assignment on a 2-1 FHA Buydown, 797 must be selected as the ADP Code and Buydown must be answered “YES”.

***

Assets – LP

When using Freddie Mac LPA for your conventional loans, only 1 month’s asset statement is required versus the standard 2.

The statement must reflect all identifying information and have a starting and ending balance.

***

Condo Documents for Brokered Loans

Did you know? The condo department is able to assist with condo reviews/obtaining docs on brokered files!

Some lenders require their own questionnaires but Production Support has the details and the Condo Department can invoice for specific fees

***

Reminder: Check your Loan Program/AUS

Please review the Loan Program on your Borrower Summary 2021 form in Encompass to ensure the AUS you are delivering to underwriting matches.  If your program says DU, you should not be running Freddie Mac LPA.

***

Underwriting Turn Times

With the launch of Lightning Close and our underwriting department running at a standard 48 hours or less, we will no longer be emailing daily turn times.

UW turn times will be posted on the Encompass Home Page seen below.

If turn times vary between submission/resubmission or purchase/refinances, that will be noted in this section as well.

25 Points

October 17, 2022

• Production Support: Department Update

As announced at the Ops Fly In, we are delighted to inform that Taryn Chatel has been promoted to Production Support Operations Manager, responsible for the daily management and oversight of the Production Support department team members, systems, and services including the company training and VDMU programs.  Congratulations Taryn – we know you and your team will do an incredible job!

 

• Ops Fly-In Recap

Wow – what an amazing weekend!  We had a wonderful time learning about Magic, the VanDyk Life of Loan process, how pink shoes really DO make the man, and that when there is an open bar and 80’s synth pop blasting all night, the VanDyk Ops team will still show up to their commitments on time.  Please remember to complete the survey and give your opinion on what we got right and how we can improve for the next event (available until 10/21) and don’t forget to check out all the fun pictures!

 

• Reminder: Bank Statement Programs Available In-House!

Remember, if you have a Primary Residence or 2^nd home self-employed borrower looking to qualify using bank statements, try pricing the loan out in Optimal Blue before brokering.  We have 2 non-delegated in house options for these loans that are competitively priced – your LO comp is not disclosed, the appraisal is ordered like a regular conventional deal, and the loan is closed in VanDyk’s name through our closing department.  Give us a try!

• 203(h) – Disaster Victims

203(h) program is available, with guidelines listed on the FHA Fixed Rate matrix (attached). Please choose the loan program “FHA 203H 30 Year Fixed.” The Section of the Act will show 203b; DU will run Approve/Ineligible due to the loan amount.

When pricing these loans, please make sure that the “HUD Specialty” box is checked.

The ADP code should be 703.  There is a Program ID in the FHA Case Number Assignment Screen drop down option which is required to be listed as “(02)- Disaster Housing” in order for the 203(h) mortgages to be properly identified in the FHA Connection system.

 

• FL Housing – FHA Single Unit Approval No Longer Available

As previously announced, for all FL Housing Bond loans with reservation dates after Oct 3^rd, Lakeview Loan Servicing has replaced US Bank as the servicer.  Importantly, Lakeview does not permit the use of the “Single Unit Approval” condo review process for FHA loans sold to them. This is the process by which we review and approve a condo project for ourselves, prior to closing.

For FHA condo loans using FL Housing DPA, the remaining options are to 1) close on a condo project already approved by HUD/FHA or 2) submit the condo review documents directly to FHA for their review and approval (“HRAP” review process).

FHA does not charge a fee for HRAP condo reviews, and the guidelines and requirements are very similar to those for the Single Unit Approval process. The key distinction between both is that HRAP turn times are published as up to 30 calendar days to complete, although timelines could be shorter depending on volume.

If you have any questions, please direct them to condoapprovals@vandykmortgage.com.

 

• FEMA Updates

Hurricane Ian Update: Here is the most recent and up-to-date list of counties in the State of Florida that have been declared a Major Disaster Area and will require an inspection based upon the attached memo:

• Charlotte, Collier, DeSoto, Flagler, Glades, Hardee, Hendry, Highlands, Hillsborough, Lake, Lee, Manatee, Monroe, Okeechobee, Orange, Osceola, Palm Beach, Pinellas, Polk, Putnam, Sarasota, Seminole, St. Johns, Volusia

 

• 4506-C – New Form

A new version of the 4506-C is coming and will be automatically updated in Encompass. DataVerify will take the old form through 11/30/2022, but after that date a new form will need to be signed by the borrower(s) in order to order transcripts.

 

• Tax Filing Deadline

We are coming up on October 17, 2022, which is the extension deadline for 2021 Taxes to be filed.  The IRS / Washington have put out guidance that those in Florida, NC, SC, parts of Alaska, and Hinds County Mississippi have until February 15, 2023, due to the recent disasters.

We will need 2021 Tax Transcripts in the file for anything with a note date on or after 11/1/2022 for all other areas.  If you are not able to obtain the tax transcripts because the borrower just recently filed, we will need to show proof of filing via one of the allowable methods AND waive transcripts to go direct to agency.  As a reminder, if the borrower owes any monies, we do need to show these as paid OR evidence of accepted IRS Installment Agreement and include in the DTI.

• Student Loan Cheat Sheet – Updated!

Our Student Loan Cheat Sheet has been updated with USDA’s new guidance as well as information when a Student Loan is Government backed and in collections with FHA.  In addition, specifics for Freddie Mac’s Student Loan forgiveness, cancelation, discharge, and employment contingent repayment programs have been added.

 

Agency Updates

• Fannie Mae

With the Selling Guide Announcement issued 10/5/2022 from Fannie Mae (attached), they are expanding the documentation options for borrowers drawing Social Security Income (SSI) from their own account or work record.  In addition to the Social Security Administration (SSA) Award Letter or Proof of Current Receipt, Fannie will now allow the SSA-1099 of the most recent signed federal income tax return (or transcripts) to serve as adequate documentation.  The FNMA Selling Guide “B3-3.1-09 Other Sources of Income” table has been updated as follows.

• Freddie Mac

Freddie Mac is specifying requirements for Borrowers who own less than 25% of a business and receive ordinary income or guaranteed payments reported on an IRS Schedule K-1 for Partnerships and S-Corporations.  With this update, the guide is now requiring that for borrows with this income characteristic, sellers (VanDyk Mortgage) must use either:

• The requirements and guidance for self-employed income in Guide Chapter 5304 Guide Section 5304.1 (freddiemac.com) or
• The NEW requirements and guidance in Section 5303.2(d) Guide Section 5303.2 (freddiemac.com), as summarized below:

Also see attached Freddie Mac Bulletin 2022-20 for additional updates related to Freddie Mac Condo Project Advisor and Property Eligibility and Appraisals.

• USDA

USDA has updated multiple paragraphs within Chapter 11 Ratio Analysis Microsoft Word – 3555-1chapter11 (usda.gov) section of the RD Handbook HB-1-3555.  Highlights from this update are:

1. Student Loans – USDA has added verbiage to the allowance of One half (.50) percent of the outstanding loan balance documented on the credit report or creditor verification, when the payment amount is zero.
2. Debt Ratio Waivers – Payment Shock has been removed from Purchase & Refinance Sections as a compensating factor.

Attached to this Newsletter are the full details of the updates; many of those being grammatical.

 

Borrowers Sharing Email – Important!

Borrowers who are not on a joint application cannot share an email address. Joint borrowers may share an email if they are on the same URLA, but co-mortgagors/borrower pair 2 may not use the same email as borrower pair 1. This is against our eConsent policy.

If you have any questions or need clarification, please reach out to Compliance or Production Support.

***

Reminder: Government Loans in LPA

Just a reminder that we are absolutely able to run Freddie Mac LPA on FHA or VA loans – but it will run ineligible. This is acceptable for government loans!

 

25 Points

September 15, 2022

• You Asked, We Listened: AskUW@vandykmortgage.comAn underwriting scenario inbox is back! Now you can email your questions directly to AskUW@vandykmortgage.com. This will create a ticket in Howee, and the underwriting manager assigned to your region will respond. Those responses come via email, so watch for responses to come from AskUW!
• Appraisal Modernization Update

Good News! We are officially live with both Fannie and Freddie for all the different appraisal options AND we have negotiated with Clear Capital to match our full appraisal pricing for the Full Hybrid reports.

Please remember to run both AUS and look for your appraisal offering – even on TBDs, you will get notice of a desktop or Hybrid options.

Workflow:

• Both: Full appraisal – Order the appropriate report
• Freddie Mac:  ACE+PDR (this is NOT a full waiver).  You need to order the ACE+PDR property inspection report which runs around $250.
• Both:  Desktop option – no inspection required.  Get a floorplan layout from the realtors and order the Desktop report.  Should take less time and cost a little less.
• Freddie Mac:  Hybrid 70H – Order the Freddie Mac Pilot 70. This is a bifurcated process.  An inspection will be done by a third party usually the next day and then it goes to an appraiser for a Desktop report using the information in the PDR that the inspector provides.
• Fannie Mae:  Hybrid 1004H – Order the Fannie Mae 1004 Hybrid. This is a bifurcated process.  An inspection will be done by a third party usually the next day BUT the PDC report is submitted directly to Fannie Mae and they will determine if they need the full 1004H or are satisfied with the value+PDC.  I am told 40% of the time this will be it for $250.  The remaining 60% will be sent to the appraiser for a Desktop report using the information in the PDC that the inspector provides.

These Hybrid options are pilot programs to help reduce turn times and allow appraisers to stay home and do more reports

• Reverse Mortgages: UpdateWe have closed our first PA Reverse and finalized the fee package for our Reverse Support Team’s services.  Look for meeting invitations where we will review the helpful and beneficial services available from this awesome team coming soon!
• Reminder: Run BOTH AUS!

We encourage you to run both DU and LPA to ensure you are offering the best appraisal option, the smartest qualifying documentation, and the most competitive interest rates.

• Conventional Buydowns

We recently announced a conventional buy-down option – the full newsflash is attached for your reference.

• Expanded Credit Scores

We are thrilled to announce 500-579 FICOs are now eligible for FHA and VA Financing with Approve/Eligible AUS Findings (no manual downgrades)!  Terms are limited to 360 months only.  First-Time Homebuyers will require a Homebuyer Education Cert and all buyers will require a satisfactory 12-month VOR/VOM.  Find attached our updated VA and FHA Fixed Matrices for further details.

• Jumbo Updates: PenFed, US Bank, Maximum Loan Amounts

Effective immediately: PenFed has been suspended as a Jumbo outlet. PenFed is working through some operational changes. During their operational changes, we have decided to suspend them as an outlet.  We will continue to monitor their ops changes and advise once we feel their service levels and pricing have returned to an acceptable level.

• • With the suspension of PenFed as a Jumbo outlet our max Jumbo loan amount internally has been reduced to $2 million. Anything over and above that loan amount would need to be brokered. We will advise when we are able to offer higher loan amounts.

Effective immediately, US Bank has lowered their maximum LTV to 80%.

• Broker Partner Update: GoPointDirect

On September 12, we received news that GoPointDirect abruptly closed their doors. There has not been any indication from GoPointDirect that they will fund the loans that remain in their pipeline. From what we have heard elsewhere, it doesn’t sound like they will be following through on loan commitments already in process. If we hear from GoPointDirect or any other industry chatter, we will make sure to communicate that to you.

 

The non-QM market has remained rather volatile as rates continue to move higher. Liquidity remains a major issue in this space as investors have moved to safer assets. We continue to see non-QM outlets tighten their credit box as a risk off approach enters this space.

 

We remain committed to providing you all with as many products as we can in the non-QM space and will search for other outlets if any gaps arise from consolidations or industry exits.

• QC Process: Reminder

As a reminder, QC Reviews are no longer completed at initial underwrite and are handled as follows:

 

Regular Reviews – 10% Requirements

1. Selected at Conditional Approval/Resubmittal at least 5 business days prior to the Closing Date – Email will go out to all parties and condition will be added
2. UW will move loan to “Approval” and notify QC Auditor after running final AUS file is ready for review.
3. Loan will not be CTC until QC Audit is cleared

 

Discretionary Reviews – MCRs / Manual UWs

1. Selected at Conditional Approval (no TBD) at least 10 business days prior to the Closing Date – Email will go out and condition will be added
2. QC will review in any of the following milestones – Conditional Approval, Resubmittal, Approval
3. Loan will not be CTC until QC Audit is cleared

 

Please ensure loans selected for pre-closing QC review are resubmitted ahead of the closing date for final review to avoid any delays in meeting the contract date.

• Escrow Holdback – Fee Increase

Due to an increase in appraisal charges, we are increasing the escrow holdback fee to $200, effective immediately.

 

Agency Updates

• Fannie Mae

Personal Gifts: Per Selling Guide Announcement SEL-2022-08 (attached), Fannie Mae has expanded the list of acceptable donors for Personal Gift Funds to include a non-relative that shares a familial relationship with the borrower, specifically a former relative, relative of domestic partner, and godparent.  This update has impacted section B3-4.3-04, Personal Gifts, of the Selling Guide.

• Freddie Mac

Gift Funds: Freddie Mac is also expanding on gift fund and gift letter requirements as a means of reaching for First-Time Homebuyers.  As such, they are updating their requirements to allow graduations gifts from both related and unrelated persons for the purchase of a Primary Residence.  See attached Bulletin 2022-18 for further information on documentation requirements.

In addition to this expansion, Freddie has updated their requirements to allow gift letters to state the MAXIMUM amount of the gift funds or gift of equity OR the actual amount.  This will eliminate the need to obtain a corrected gift letter should the actual amount of the gift be less than the amount stated on the gift letter.

1099 Employment/Income: Freddie Mac is providing more detailed guidance on income received on IRS Form 1099.  Attached Bulletin 2022-18 outlines a summary of the existing and updated requirements surrounding this income type.

• USDA

Rural Development Fee Structure for Fiscal Year 2023: The fees for the coming year have remained unchanged at 1% upfront guarantee fee and .35% annual fee for both purchase and refinance transactions.   See also Fiscal Year 2023 Conditional Commitment Notice (govdelivery.com) regarding yearly lapse in funding.   The lapse will have no effect on our loan flow or procedures.

Upcoming Events and Reminders

If you need an invitation to one of the Zoom meetings, please respond to this message.

• Iron Sharpens Iron – Tuesday, September 20 @ 11am Eastern
• VanDyk Mortgage Newscast (Formerly Ops Huddle) – Friday, September 16 @ 1:30pm Eastern
• Production Roundtable – Thursday, September 22 @ 3pm Eastern
• 35^th Anniversary Events
• October 8, 2022 | Ops Fly-in 35^th Anniversary Meet and Greet
• March 2 – 4, 2023 | Annual Sales Fly-in

Property Taxes – Important!

We are approaching the months of the year where property taxes are coming due. This is important for us when structuring our LEs and cash to close on files. Many title companies and attorneys’ offices will begin using the estimates for what is due to establish tax proration credits, and we will also need to account for this in our escrow account set-up as well, which in turn effects the final monthly payment we use for qualification.

 

Please be sure that you are reviewing the most up-to-date estimates in your locality. Also be reminded that in situations where taxes or CDDs are paid for the year in advance, there is a considerable reimbursement due from our Borrowers to the Sellers on purchase transactions. This often times grossly increases cash to close over what we may have estimated – please review your LEs and escrow account set-ups carefully and make sure that your borrowers have the most accurate information up front.

***

Reminder: Tax Proration Credits

We have completed the research in all agencies as to when the Tax Proration can show on the URLA and run through the AUS:

1. 1. FNMA Conventional DU – You CAN add to URLA DOT and run through AUS; Can show on the CD
   2. Freddie Mac Conventional LPA – You CANNOT add to URLA DOT and run through AUS; Can show on the CD
   3. FHA – You can only add to ULRA DOT and run through AUS “IF” the borrower has sufficient funds for the 3.5% MRI + Closing Costs + Prepaids less any seller/lender/OTP credits; Can show on the CD
   4. USDA – You CAN add to URLA DOT “IF” the borrower is not receiving any cash back from the Tax Proration; Can show on the CD BUT the borrower CANNOT receive any cash back from the Tax Proration Credit.
   5. VA – You CAN add to URLA DOT and run through AUS; Can show on the CD AND borrower CAN receive cash back from the Tax Proration Credit.

25 Points