Fannie Mae Updates Selling Guide
On October 2, 2018, Fannie Mae made the following updates to its Selling Guide.
Employment Information – Union Members
Where borrowers work in occupations that result in a series of short-term job assignments (such as a skilled construction worker) and a union facilitates the borrower’s placement in each assignment, the Guide has been updated to now permit this type of union to provide:
- the verbal verification of employment for a union member who is currently employed
- an executed employment offer or contract for future employment for a union member who is not scheduled to begin employment until after the loan closes
The change was effectively immediately.
Employment-Related Assets as Qualifying Income
For loans where an employment-related asset or assets are used as qualifying income, and where the asset owner is at least 62 years old at the time of the loan closing, Fannie Mae has increased the maximum LTV, CLTV, HCLTV ration from 70% to 80%. If the asset(s) is jointly owned, all owners must be borrowers on the loan and the borrower whose employment-related asset is being used as income must be at least 62 years old at the time of closing.
Prior to a future release of Desktop Underwriter, loans receiving a recommendation of “Approve/Ineligible” due to a LTV, CLTV, or HCLTV ratio over 70% may be delivered to Fannie Mae when the lender ensures the loan complies with the updated policy.
Outsourcing of Mortgage Processing and Third-Party Originations
Fannie Mae simplified its selling policy regarding outsourcing of mortgage processing and third-party originations, in order to provide additional clarity with regard to its expectations for lenders in their management of third-party originators. Only the requirements necessary for compliance remain. Examples, as well as recommendations and best practices have been removed.
Selection of Comparable Sales for MH Advantage Appraisals
Fannie has also clarified the comparable sales requirement for appraisals of MH Advantage homes. Appraisers must use sales of other MH Advantage homes when available. If fewer than three MH Advantage sales are available, then the appraiser must supplement with the best and most appropriate sales available, which may include site-built homes.
The complete update is available for viewing here: https://www.fanniemae.com/content/announcement/sel1808.pdf
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