VanDyk Mortgage News: August 4, 2023

August 4, 2023 

• Halcyon – Income Validation in LPA!

AWESOME NEWS!  Once your transcripts are back from Halcyon, they are automatically added to your eFolder and the report ID is saved into the GSE provider form in Encompass.  With this report ID, your Freddie Mac LPA will automatically evaluate the self-employed income and you may obtain income rep & warrants. This means you would NOT be required to submit any additional income information (tax returns, VOEs, etc.) for the borrower/business/income amount being validated. Contact Production Support if you have any questions.

• 4506Cs – Exciting Update

After extensive testing and excellent results with the 8821 and Halcyon, we are delighted to be able to remove all 4506C forms from our initial disclosure packages and deliver them to be signed at closing only.  WINNING!

• Reminder – Freddie Mac Direct Deposit as Income/Employment Validation

If your AccountChek report documents direct deposits, before you order a VOE on your conventional loan, run LPA and see if you get an income validation.  If you do and you can qualify using the income as validated, you do NOT need to obtain any other income or VOE documentation!

AccountChek would need to be pulled and LPA run before any other third party VOEs.  Be sure to ask the borrowers to provide all accounts their pay is deposited into when they are completing the AccountChek request (how many of YOU have your paycheck deposit split into 2 or more bank accounts?).  The AccountChek report cost is around $18 for a 60-day w/ refresh or $21 for a 90-day w/ refresh.

Please see the attached Income Validation Eligibility attachment for the history requirements by income type.

• Chase Community Lending Update

Chase is waiving LLPAs on Community Lending Program loans when the scenario is run with LP AUS. This applies even for borrowers that do not qualify for the First Time Homebuyer LLPA Waiver. Always make sure you are viewing the LP Pricing on all scenarios.

• If a loan is locked as LP, LPA must be run, and you must follow the LPA findings and LP guidelines for that transaction. If a Community Lending loan locked as LP has to be switched to DU, you will receive the DU pricing which will have the LLPAs added back.

• Updated Process for Up Front Fee Collection

Per direction from regulators, we will be retiring the use of the Credit Card Authorization Form for collecting upfront appraisal and/or Condo payments from borrowers. Both ValueLink (appraisals) and The Condo Vault (condos) allow the collection of borrower’s upfront payments via secure link, which can be sent to the borrower upon order submission.

• Funding Review Update: Introducing Clear Skies Funding!

We are pleased to announce we are revamping our funding process to eliminate the need for a funding review prior to funding authorization. This change will allow settlement agents to fund our loans “At Will” if they adhere to our closing instructions/procedures and are willing to assist with any corrections needed post-closing.

This change to Clear Skies Funding will dramatically increase the speed of funding and make for a turbulence-free borrower experience at closing.

At this time, Clear Skies Funding will not be available for bond loans, specialty loan programs, or files with prior to funding conditions. These loans will require a funding review prior to funding authorization. Please contact your assigned closer to confirm your funding options.

• New Broker Partner: Change Wholesale

We are excited to announce that we have added Change Wholesale into the mix of our broker partners. Change offers several non-qm options including a no ratio loan similar to Champions. With the Change No ratio loan, they have some intriguing ARM offerings that Champions does not. Be on the lookout for an upcoming sales call with Change – invitations coming soon!

• Post-Close Reminder
  Reminder: we do sell loans once they are closed, and from time to time the investor buying the loan will condition us for items. If you receive an email after your file closes from Rayna Jenkins, she is looking for assistance in clearing an investor condition. Please help clear these conditions as quickly as possible. Every day that a condition sits costs real dollars in execution.  
• Manufactured Homes in a Condo

We are pleased to announce that we have lifted our restriction preventing financing of Manufactured Homes in a Condo Project for Conventional, FHA, and VA financing!  The condo project MUST be agency approved; no FHA or VA spot approvals will be accepted.  Applicable matrices have been updated and can be found in Howee.  Below, find the appraisal types required for each agency – see the attached Encompass Data Points PDF for details on how to enter this type of property within Encompass.

• COMING SOON: Soft Pulls + AUS!

If you missed the announcement on Thursday, our VanDyk team has been looking for a solution to run AUS with a soft pull – and we have found this with Xactus and Freddie Mac. (Sarma may be an option for soft pulls run through Freddie in the future.) This is still a work in progress, and more details and formal training will be provided in the coming weeks and months – but this exciting news should be shared and celebrated! Please see the attached email for full details.

• Quality Control Insight – Trending Defect: Sales Contract Missing or Defective

In recent months we have seen an increase in defects or deficiencies related to the Sales Contract. Below are some of the repeat findings that have been noted during Quality Control reviews.

The most noted defect is that of missing addendums to the sales contract.

• Please include all referenced numbered addendums, exhibits in the sales contract and request all missing addendum pages prior to closing.

1. Addendum correcting buyer’s name.
2. Addendum correcting sales price, increase or decrease.
3. Addendum correcting sales concessions
4. Addendum, Appraisal Gap terms
5. Addendum removing non-borrower
6. Seller Disclosure missing
7. Fully executed Lead Based Paint Disclosure
8. Addendum disclosing relationship between seller and agent

Agency Updates

Fannie Mae

The selling guide update isn’t offering much, but the DU update this month is AWESOME! Fannie Mae has listened to us on the confusion with DU’s green checkmark for Value Acceptance in instances that we don’t truly have an appraisal waiver.  As a result, DU will no longer display a green checkmark in the Day 1 Certainty Property Information section when the lender receives the message stating the loan is eligible for value acceptance + property data but that eligibility is contingent upon the submission of property data to the Fannie Mae Property Data API.

DU will continue to display the green checkmark in the Day 1 Certainty Property Information section when able to determine the property data was submitted to API.

Freddie Mac

Applications for IRS Installment Agreement – Effective immediately, where a borrower has applied for an installment agreement with the IRS and it is pending approval, the following requirements must be met:

1. The application for the installment agreement reflecting the amount of taxes owed and requested payment terms must be documented in the mortgage file,
2. The greater of the monthly payment amount requested by the Borrower or the amount of taxes owed divided by 72 must be included in the Borrower’s DTI, and
3. There must be no indication, and no knowledge, that the IRS has filed a Notice of Federal Tax Lien for the taxes owed by the Borrower.

*In addition: Our partnership with Halcyon and Freddie Mac has contributed to advancements in AIM with LPA utilizing Tax Data!!  AIM has been enhanced using tax data from Halcyon to attain R&W income for IRS Form Schedule C.  Way to go VanDyk Team!

USDA Updates

USDA has made updates to the 2023 Income Limits!  Check your eligible areas here https://www.rd.usda.gov/income-limits

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Upcoming Events and Reminders

Miss a training? You’ll find our monthly newscast and Iron Sharpens Iron recordings in the VDM Vault. Department-specific trainings are shared in their respective Seafile folders.

Don’t forget: you can find invitations on our shared calendar under Upcoming Events at VDMC.net.

• Deal Desk: Loan Save with Dave: Every Tuesday at 1pm Eastern
• Deal Desk: Feature Topic + Loan Save with Dave: Every Thursday at 1pm Eastern
• VanDyk Mortgage Newscast: Friday, August 11 @ 1pm Eastern
• Iron Sharpens Iron: Tuesday, August 15 @ 11am Eastern
• Production Roundtable: Friday, August 18 @ 3pm Eastern MANDATORY for all LPs and TCs

Loan Template Sets: They’re Important!
If you are duplicating a loan, please don’t forget to apply the Loan Template Set. This template contacts the closing cost template, loan program template, and default field data that is needed in order to run AUS, submit the loan to processing/UW, and more.

If we forget to apply that template, adding it later can result in a loss of loan data. See the attached “How To – Duplicate a Loan” and “How To – Apply a Loan Template” for step-by-step instructions.

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Bonus Income
Did you know that when using and breaking out Bonus Income to qualify, we must annualize the YTD Bonus Income UNLESS the employer has documented the frequency of the Bonus Income?