VanDyk Mortgage News: February 7, 2024

February 7, 2024

• 2024 Virtual Fly In

Are you ready to Pump Up the Volume?  We are beyond excited to present our first companywide virtual fly-in event this month!  Be sure to visit the event webpage (http://vandykflyin.com/) to register, review FAQs and see all the most up to date details.  You will not be able to log in the day of the event unless you have completed the registration form here. Be sure to visit the site and get yours done soon. You are encouraged to invite your realtor partners to join us!

Help us help you: Please complete our survey on breakout sessions so we know what you’re most interested in attending. Access the survey here!

• New Broker Partner: American Heritage Lending

We are excited to announce a new broker option: American Heritage Lending. AHL offers hard money/bridge loans in addition to other NonQM options (DSCR, Foreign National, Alt Doc, Asset Qualifier). We will host a session with AHL in the coming weeks to learn about their loan options – be on the lookout for an invitation!

• HomeReady/HomePossible: New DPA Option

Fannie Mae and Freddie Mac have launched a $2500 grant program designed to help very low-income borrowers. To qualify for this program, borrowers need to be eligible for either HomeReady or HomePossible and have income at or below 50% AMI. We are working through the back-end process of this program and will announce when we are fully ready to utilize the program. In the meantime, if you have a deal that meets this criteria, please reach out to Brad Chatel and he will coordinate with all departments to ensure we work through the logistics.

• 2023 4506Cs at Closing: Reminder

Reminder: any application dated on or after 1/31 will require a 2023 4506C for all borrowers to be signed at closing. The Production Operations Staff were advised of the need for the 2023 4506C during last month’s Round Table.  Be sure to check your Request for Transcript of Tax form in Encompass and ensure the 2023 form has been added for each borrower prior to closing to avoid any post-close issues.

• • As a reminder, the 4506C form is only sent with the closing package. Initial disclosures are sent with the 8821 for Halcyon orders.
• Trainings from MI Companies/Agencies

Check out these training highlights for the month of February:

• Lakeview National DPA Loan Program – February 14 – Register Webinar Registration – Zoom
• Lakeview National DPA Loan Program – February 21 – Register Webinar Registration – Zoom
• MGIC – Can I Use Rental Income from a Business-Owned Property? –  February 28 – Register MGIC Webinar: Can I Use Rental Income from a Business-Owned Property?

• Income Documentation Updates  

For applications dated on or after 1/31/2024, OR loans with a note date on or after 2/15/2024: 2023 W2s OR a Written VOE will be required.

• • Tax Transcripts Cheat Sheet:  Updated version for 2024 is attached.
  • Income Worksheet – Prism: Updated within Encompass to include tax year 2023.
• Marketing Updates

New birthday BombBomb Vist videos are available to record! Log in to your BombBomb Vist account now to record personalized birthday videos for all your contacts with a birthday on file, including realtors and clients. If you don’t create a custom video, a standard corporate one will be sent instead. Be creative and make each birthday greeting special. Remember to vary the videos to keep them fresh year after year. Let’s ensure every birthday wish is unique and memorable.

• HR Updates

Priority Health offers a mobile app that allows you to manage your health insurance anytime, anywhere. Please see the attached PDF for more details.

Agency Updates

Fannie Mae

• Value Acceptance + Property Data is now allowable for Condos.  DU will begin issuing messaging on condo casefiles effective immediately.  As a note, we are still required to confirm the condo project eligibility.

• Manufactured Housing Cash-Out Refinancing is now available for a multi-width MFH for a 30-year mortgage term (formerly 20 years).  Single-wide MFHs remain ineligible for cash-out refinances.

• Non-Traditional Eligible Credit References have been expanded upon to include the following:

1. Rent: Fees paid to a landlord or property management company;
2. Private Mortgage: Housing payments not reported to the credit bureaus provided the payments are related to the borrower’s residence; and
3. Real Estate Taxes: Payments made on a principal residence, regardless of payment frequency (for homes owned free and clear).

• Use of Business Income Clarifications for Borrowers with less than 25% Ownership:

1. If business tax returns are provided, we are not required to analyze the viability of the business.  We may rely solely on the borrower’s proportionate share of the business income as reflected on the Schedule K-1.
2. Income reported on Schedule K-1 can only be considered for qualifying if we verify that the income was actually distributed to the borrower consistent with the level of business income being used to qualify (meaning that there are distributions and those are supported by the ordinary income) OR that the business has adequate liquidity to support the withdrawal of earnings.

• Property Insurance Requirements:

1. For 1-4 Unit properties and master property insurance policies, the following clarifications apply:
   1. In addition to actual cash value coverage being unacceptable, policies that limit, depreciate, reduce, or otherwise settle losses at anything other than a replacement cost basis are also not acceptable.
2. For Master Property Insurance, the following clarifications apply:
   1. The minimum required perils that a policy must cove are those found in a commercial “Broad” coverage form.
   2. Outdated references to guaranteed replacement cost, extended replacement cost, and replacement cost coverage have been removed to improve clarity.
   3. Coinsurance requirements have been removed to streamline the property insurance review process and to ensure that all project developments are reviewed for sufficient coverage.

Freddie Mac

• Freddie Mac is aligning with Fannie Mae at the direction of the FHFA on the Insurance updates noted above.

• Trust Income Documentation requirements are being updated effective with loan applications March 1, 2024, as follows:

1. Documented History of Receipt of income for the most recent one-year
2. When documenting continuance where the borrower is the Trustee, a letter from the Trustee is not acceptable documentation.

• ACE (appraisal waiver) Eligibility is being updated to allow for cash-out refinance mortgages.  The parameters of this offering will be 70% LTV for C/O refinances secured by a primary residence and 60% LTV for C/O refinances secured by a second home.

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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 What’s Happening at VDMC.net (all times posted on the What’s Happening calendar are EST)

• Deal Desk: Every Tuesday at 1:30pm Eastern
  • Reminder: Tuesday, February 13 is our special CONDO Deal Desk, covering FL Condos and Milestone Phase Inspections as well as Master Insurance issues.  Realtors are invited to attend. Invitation is attached, please forward as needed!
• VanDyk Mortgage Newscast: Thursday, February 8 at 1pm Eastern
• Iron Sharpens Iron: Tuesday, February 20 @ 11am Eastern
• Pump Up the Volume! Monday, February 26^th to Friday, March 1^st

*There will be no mandatory Round Table for February. Processors/TCs will be notified of the mandatory virtual fly-in sessions being assigned to them.

Prism Income Calculation Help

When submitting a request to askuw@vandykmortgage.com for income help, please ensure that you have already completed Prism or Prism Plus (Tax Return borrowers).

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EPO Scenario – Calculating Proceeds, Can They Pay Off REO?

We are seeing many EPOs (early payoff) in situations where the borrower is purchasing a new home and has a property that is pending sale or will be sold.

EX:  Sales Price (if listed) OR Value (if not listed) multiplied by 90% less any lien payoffs = Projected Net Proceeds.

If those Net Proceeds are enough to pay off our loan, we should be having conversations with our borrowers.  This quick calculation early in the loan process can help identify those loans that could be subject to an EPO and allow us the opportunity to set expectations with our borrowers to prevent an early payoff from happening.

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Halcyon Reminder: Photo ID Required 

Reminder, a photo ID is REQUIRED when placing an order for transcripts with Halcyon. A how-to guide is attached.

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aiUW and Soft Pulls: Reminder

For loans where you’ve used a soft pull for initial underwriting submission, we need a full tri-merge credit report and AUS run in order to resubmit (as you already know). We also need to re-run aiUW for updated conditions based on that credit report that may need to be addressed. Don’t forget to re-run aiUW prior to resubmittal!

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