VanDyk Mortgage News: January 10, 2024

January 10, 2024

• 2023 Lookback/Gratitude Wins

As you are aware, VanDyk Mortgage is the best of the best!  We rise above other lenders in the industry in many areas but feel our people and our culture are what set us most apart.  With the focus we place on integrity, honesty, hard work, and gratitude, we have been able to support each other through one of the roughest years in recent memory.  See the attached document showcasing just a few of our team members quoted from 2023 – we are grateful for your attitudes of gratitude!

• 2024 Newscast Schedule

To ensure all employees have opportunity to attend our monthly newscast, we are taking over the 2^nd Thursday of each month at 1pm EST time slot.  A calendar invite was sent out and the meeting details are also posted on our shared What’s Happening calendar on VDMC.net.  Email ProductionSupport@vandykmortgage.com should you like the outlook invitation re-sent to you or forwarded to potential recruits.

• Credit Report Costs

As previously announced, costs for credit reports and credit related services are increasing.  See the attached email for details regarding the SARMA fees and be sure to review with your Branch Manager any changes in what is being disclosed to your borrowers.

• Soft Pulls with LPA

Due to the increased fee for soft pull reports taking effect 1/19/2024, we have revised our policy for loans being submitted to LPA / Underwriting with a soft pull to allow for a single or two-bureau report instead of requiring all three bureaus.  Please be mindful of the following:

1. If completing a 1 bureau pull, Experian is the default you should select (they tend to be the most accurate and are the least expensive)
2. If pulling 2, Experian and TU are the default.
3. To lock using a soft pull, a three-bureau report must be provided.

A copy of the breaking news email addressing this is attached and you can contact ProductionSupport@vandykmortgage.com for assistance.

• Pipeline Updates

We have created a new pipeline view for LOs available now in your Encompass!

The Loan Officer – Refi 2024 view will provide you with a list of borrowers closed on a rate over 6.4% who may be eligible to Rate/Term refi when interest rates drop.  We recommend reaching out to these borrowers ahead of time to get everything lined up so you can close them all quickly once you lock them in.  BRING IT ON 2024!!!

• Trainings from MI Companies/Agencies

We are thrilled to make 2024 a growing year.  This year, each month we will be highlighting trainings that both our agency and MI partners are offering.  Nothing is top secret or off limits!  We know knowledge is power and we are powerful people. Highlights for the month of January:

• • Freddie Mac Policy on Point Webinar (previously recorded) – VARIABLE INCOME!  A Discussion With Policy and Quality Control Experts About Rental and Employed Fluctuating Income (youtube.com)
  • Essent’s “DU Live! Advanced Micro Session” – January 9 – Register Here (gotowebinar.com) AND “LPA Live!  How to READ AUS Findings like a PRO” – Coming January 11 – Register Here (gotowebinar.com)
  • USDA Turn Income Into Opportunity – Coming January 18 – Register REGISTRATION SFHGLP “Turn Income into Opportunity” January 18, 2024 (2 pm – 3 pm ET) (office.com)
  • MGIC – Self-Employed Borrower Opportunities – January 16, January 23 and January 30 – Multiple Sessions can be found here: Mortgage Industry Training | MGIC

Find links to additional training provided by the MI companies here.

• EPO Policy Reminder

With the anticipated rate drops for 2024 and refinances on the horizon, we wanted to remind everyone of our Early Payoff policy.  Be sure you are watching the Earliest Refi Date in your Encompass pipelines and talk with your borrowers up front on every transaction regarding their intent to keep the loan.  If it is anything less than one year, communicate with Secondary to ensure your risk is minimized wherever possible.  Our EPO policy can be found HERE.

• EPDs and Risk

VP of Servicing Pam Groosbeck has put together an overview of delinquent loans and the seven basic stages of default. Please take a moment to review to see how the back end impacts the front end when it comes to delinquent loans.

Interested in learning more about VanDyk’s stance on late payments and early payoffs? Tune in to the Newscast for a special feature discussion piece.  You don’t want to miss this!

• Updated 8821/Halcyon Form

Halcyon has updated their disclosure to provide more transparency and detail regarding the individuals named on the 8821.  The new disclosure has been updated in Encompass as a 2 page document with the 8821 form to be signed by the borrower as the second page.

• Howee’s Agency Guideline Search: Updated

If you missed our announcement on December 12, the Howee Agency Guideline search has been improved. Check out the attached email for more information, and try it out next time you have a guideline question!

• Marketing Updates

Have you joined Marketing’s Video Challenge Teams Channel? Participate to learn and improve your video marketing techniques, dynamically connect with clients and colleagues, and have the chance to WIN BIG!!  Reach out to Morgan Bledsoe today to get added to the Teams Channel!

• HR Updates

Available Now: 2024 Annual Employee Training

• • As of January 2, the Annual Employee Training course is available to complete. Please visit VDMU to complete your training today.
  • New employees hired from Oct 1 -December 31, and who have already completed the training, do not need to repeat the training at this time.
  • See the attached announcement and contact hr@vandykmortgage.com with any questions.

Blue Cross Blue Shield: Mobile App Instructions

• • Always have your virtual Blue Cross Blue Shield card accessible for dental and/or vision care appointments. Check out the attached instructions to download!

Agency Updates

REMINDER: Self-Employed Borrower + Rental Income

As a reminder, effective January 1, 2024, Fannie Mae and Freddie Mac both updated their requirements involving self-employment and rental income.    Here is a highlight of those changes:

Fannie Mae – https://singlefamily.fanniemae.com/media/37021/display

Rental Income:

1. Non-Subject Rental Properties acquired in the last 12 months will require the borrower to have a primary housing expense and at least a one-year history of property management experience to use the full amount of rental income towards qualifying, otherwise the amount may be limited.
2. Lease Agreement use – Form 1007 or Form 1025 must support the income reflected on the lease agreement or the lease agreement must provide evidence the terms of the lease have gone into effect with proof of receipt for at least two-month’s rental payments.

Self Employed:

1. Less than a two-year history – Personal and Business Federal Tax Returns must reflect a minimum of 12 months of self-employment income from the current business (if a business was opened 2/1/2022, the 2022 tax return would not have a full 12 months of self-employment income and therefore could not be considered).
2. Using one-year of Tax Returns – This will only be allowed when ALL self-employed businesses have been in existence for five years and the borrower has had a 25% or greater ownership interest for the last 5 consecutive years.

Freddie Mac – https://guide.freddiemac.com/app/guide/bulletin/2023-19

Lease Agreements:

1. Lease term of a minimum of one-year is being removed – This is a flex!
2. Newly Executed Leases must require the due date of the first rental payment be no later than the first payment due date of the Mortgage.
3. Evidence of receipt of the security deposit plus first month’s rent OR receipt of two month’s rental payments AND must have evidence that the payments were cashed or deposited into the Borrower’s depository account or transferred into a third-party money transfer application account owned by the borrower.

Fannie Mae

Verification of Employment

Effective immediately, Fannie Mae has updated their Verification of employment to include alternative documentation to satisfy the final verbal verification of employment such as a paystub or bank statement.

• Within 15 business days prior to the note date, the borrower can provide either
• The most recent available paystub as of that date that

o meets the requirements in B3-3.1-02, Standards for Employment Documentation,

o reflects information for the most recent expected pay period based on the date it is provided and the borrower’s pay cadence, and

o does not include any information indicating the borrower may not be actively employed.

• Bank statements dated no earlier than 15 business days prior to the note date that

o meets the requirements in B3-4.2-01, Verification of Deposits and Assets,

o reflects information for the most recent expected pay period based on the date of the statement and the borrower’s pay cadence, and

o does not include any information indicating the borrower may not be actively employed.

Restricted Stock Units and Restricted Stock

Restricted Stock Units and Restricted Stock has been added as an eligible income source under “Other Sources of Income”.  Documentation requirements can be found here.

Non-Taxable Income

Fannie Mae is aligning with Freddie Mac to allow 15% of the social security income to be grossed up by 25% and added to qualifying income without needing to provide additional documentation (tax returns) evidencing the nontaxable status.  They have also specific that child support income may be grossed up by 25% without having to provide documentation of nontaxable status.

Freddie Mac

Verification of Employment

Effective immediately, Freddie Mac is also updating their 10-day Verification of employment to include use of a paystub.  The paystub must be the pay period immediately preceding the Note Dat AND has the “paid through” date no more than 15 business days before the Note Date.  For all alternate 10 day PCV allowances from Freddie Mac, visit their Selling Guide.

Non-Occupying Borrowers on Cash-Out Refinances

Effective with loans closing March 6, 2024, Freddie Mac is no longer allowing non-occupying borrowers.  All borrowers must occupy when it is a Primary Residence.

Condo Project – COMING SOON!

Coming in February, Freddie’s Condo Project Advisor Project Assessment Request will indicate if a project is not eligible.  Also in February, the condominium unit mortgages webpage will detail how an authorized representative of an HOA may contact Freddie Mac to inquire both whether a project has received a “Not Eligible” status and/or how to appeal a “Not Eligible” status.

VA

As announced in a special Corporate Communications update (attached), effective as of January 1, 2024, non-medical and non-charged off collection accounts must be considered in the DTI with 5% of the balance unless there is a documented established payment arrangement.

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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
• In House HELOAN Training: Wednesday January 10^th @ 1pm Eastern
• VanDyk Mortgage Newscast: Thursday, January 11^th @ 1pm Eastern
• Iron Sharpens Iron: Tuesday, January 16th @ 11am Eastern
• HECM 101 – Reverse Mortgage Training: Wednesday, January 24^th at 11am Eastern
• Production Roundtable: Wednesday, January 24^th @ 1pm Eastern – National Talk Like a Grizzled Prospector Day  REMINDER: ATTENDANCE IS MANDATORY for all LPs and TCs/LOAs who perform Processor or TC functions.

Updated Matrices

The VanDyk matrices have been updated to reflect 2024 loan limits. You can review in the Product Matrices folder here.

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FHA Timeframes

Where the 4000.1 HUD Handbook is silent on what a timeframe is based upon, it is to be assumed that it is based on the FHA Case Number Assignment Date.  An example of this would be late payments in the last 12 and 24 months.

In a case where the FHA Case Number has been transferred to us from another lender, the timeframe is based upon the date of the documented transfer.

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FHA New Construction Reminder

For aiUW to generate FHA New Construction document requirements: “New (less than 1 year)” must be checked within the HUD-92900LT FHA Loan Transmittal:

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Brokered Loans & Appraisals

As a reminder, any questions regarding a brokered loan appraisal should be directed to the Account Executive.