Answer(s): No, Maybe and Yes (in the near future) As one can tell from the answers outlined above, there is some confusion and inconsistencies in the underwriting policies of VA and FHA relative to the topic of charging Tax Service fees to borrowers. Unfortunately, this confusion can lead to deficient underwriting review ratings with lenders being asked to make refunds…
Pre-Closing (or Pre-Funding) Reviews Will Now Be Required on FHA Loans In HUD’s draft “Origination Through Post-Closing/Endorsement Handbook” it is stated that a mortgagee’s required Quality Control (QC) sample must comply with the following balance of pre and post-closing reviews: Pre-Closing Reviews – 10% or less of the QC sample size Post-Closing Reviews – 90% or more of the QC…
Freddie Mac On May 29, 2015, Freddie Mac has stated that, beginning June 1, 2015, the use of Loan Prospector will be free for all new loan submissions. Loan Prospector is Freddie Mac’s automated underwriting system which provides feedback to lenders on loan eligibility as well as minimum documentation requirements for underwriting the loan transaction. Fannie Mae Fannie Mae rolled…
In honor of David Letterman’s recent departure from television, I have compiled a Top Ten list of concerning policies in HUD/FHA’s draft 4000.1 Handbook. Number 10: The Mortgagee must re-verify, in writing or electronically if available, employment, income, assets, gift funds, source of funds and mortgage or rental payments as part of a pre-closing (or pre-funding) review. (Page 506) Although…
Are You Prepared? Several months ago, HUD/FHA released a draft copy of its “Origination through Post-Closing Endorsement” Handbook (4000.1) on its website. Most noteworthy is the fact that the policy & procedural changes that are being implemented by HUD/FHA via this Handbook are scheduled to be effective as of June 15, 2015 – which is now less than 3 months…
