by usezloan | Aug 12, 2021 | Financial study
융자지식206- NON-QM A UNDERWRITING GUIDELINES 4
Income Documentation Option (Full-Doc)
4.1 Salaried Borrowers
Portfolio Program Matrices
Salaried income from employment should be from related fields if the Borrower has held multiple
jobs. In some cases, an employer does not offer year-round employment for a certain position, such
as the building trades or farm workers (seasonal income). The evaluation of stable earnings must be
based upon whether the Borrower(s) is able to consistently generate a similar amount of income
from the employers listed.
If the income is determined to be stable, the next step is to develop an income figure from the
verified information that represents dependable earnings as a basis for repayment of the loan.
Non-QM Mortgage Program
Purchase Eligibility Guidelines
06/22/20 Confidential and Proprietary Page 8 of 44
Special attention must be given to additional compensation in the form of overtime, bonus,
commission, or from other acceptable sources, so that the income used to qualify is truly
representative of what the Borrower will continue to earn. Variances in earnings from these sources
must be carefully evaluated to determine if income is stable.
For salaried Borrowers, pay stubs covering at least one (1) month’s year-to-date (YTD) earnings,
along with the most recent two (2) years’ W-2 statements are required to verify their income.
Second-job income will require receipt of pay stubs covering at least one (1) month’s YTD earnings
and most recent two (2) years’ W-2 statements. For qualifying purposes, the second-job income will
be based on a two (2)-year average of the W-2s.
Follow FNMA guidelines with regard to commission, bonus, or overtime income greater than 25% of
base income. In general, we will require YTD pay stubs and W-2s covering the most recent two (2)-
year period or a written verification of employment (VOE).
Please reference the “Employment and Other Sources of Income” section of the Selling Guide:
Fannie Mae Single Family for additional information regarding income documentation and
qualification guidelines.
4.2 Self-Employed Borrowers
Self-employed Borrowers are identified as any individual(s) who has a 25% or greater ownership
interest in a business. The following factors must be considered when analyzing a self-employed
Borrower:
• The stability of the Borrower’s income;
• The location and nature of the Borrower’s business;
• The demand for the product or service offered by the business;
• The financial strength of the business; and
• The ability of the business to continue generating and distributing sufficient income to
enable the Borrower to make payments on the requested mortgage.
Self-employed Borrowers must have been in business for at least two (2) years to be considered for
qualification.
Self-employed Borrowers will be required to provide the most recent two (2) years’ personal tax
returns (all schedules) and two (2) years’ business tax returns, if applicable (i.e., Partnership, LLC, SCorporation, or C-Corporation). In addition, the following is required:
• If more than 120 days has passed since the filing of the latest Schedule C or business tax
return, a dated YTD unaudited profit and loss (P&L) statement;
• Evidence of the existence of the business for the past two (2) years (i.e., a Certified Public
Accountant (CPA letter); and
• A signed 4506-T and 1040 tax transcripts covering the most recent two (2) years (not
required for business returns).
Non-QM Mortgage Program
Purchase Eligibility Guidelines
06/22/20 Confidential and Proprietary Page 9 of 44
4.3 Fixed Income
This applies to income sources such as Social Security (including dependent’s Social Security),
disability payments (temporary or permanent), VA disability, retirement/pension, or alimony/child
support. If this income is used for qualification of the Borrower(s), evidence of income and
probability that it will continue for at least three (3) years past the application date must be
provided.
Note: Borrowers who are on a temporary leave from their current job for reasons such as maternity
or parental leave, short-term disability, and other temporary leave types that are considered
acceptable by law, and/or the Borrower’s employer will be considered for eligibility on a case-bycase basis, subject to Fannie Mae guidelines for temporary leave income as defined in Fannie Mae’s
Selling Guide, B3-3.1-09, Other Sources of Income.
If the fixed income source is verified as non-taxable income, it may be adjusted or “grossed-up” by
125%, provided that:
• Only the net income will be used for determining disposable/residual income; Medicare and
insurance payments are to be omitted;
• The Borrower(s) clearly benefits as a result of income being grossed-up to qualify; and
• The Borrower’s net income (before gross-up) is sufficient to pay all debts.
Non-taxable income that is not allowed to be grossed up includes:
• Foreign-earned income,
• Foster care income, and
• Housing allowance.
4.4 Capital Gains and Losses
Capital gain or loss that is a one-time transaction will not be considered as a gain or loss in
determining the income available to the Borrower(s). However, if the Borrower’s business has a
constant turnover of assets that produce recurring gains or losses, the capital gain or loss may be
considered in line with the following:
• An average of the gains or losses for the last two (2) years as disclosed on the Borrower’s
income tax form 1040, Schedule D, will be used to calculate the income.
• When the income from this source represents a substantial portion of the Borrower’s
income, the Borrower’s tax returns for the past two (2) years must be reviewed (regardless
of documentation type) to determine an accurate estimated of average earnings. For
example, an asset sold during the year might be an income-producing asset, which could
result in a reduction in future income.
• Borrowers must have an asset base in order to use capital gain or loss on an ongoing basis.
Non-QM Mortgage Program
Purchase Eligibility Guidelines
06/22/20 Confidential and Proprietary Page 10 of 44
4.5 Farm Income
Net farm income reported on the Borrower’s income tax return (Schedule F) is eligible with the
addition of depreciation, pension, amortization, and depletion.
Note: Farm income cannot be generated by the subject property as income-producing farm
properties are ineligible for purchase.
4.6 Interest and Dividend Income
Interest and dividend income may be used for qualification if it has been verified through two (2)
years’ tax returns as a stable source of income, and if additional verification is obtained as proof that
the funds are still on deposit in the financial institution and/or investment portfolio account. Income
must be proportionately reduced if funds are used for closing in a purchase money transaction.
4.7 Military Income
Income verified for clothing allowance, quarters allowance, hardship or hazard pay may be included
as stable income if there is a likelihood of continuance. Basic Allowance for Housing (BAH) and Basic
Allowance for Subsistence (BAS) may be grossed up to 125% due to their non-taxable status. Other
allowances may also be grossed up to 125% if documentation is provided evidencing the allowance
is non-taxable.
4.8 Note Income
Note income is eligible for qualification, so long as a complete copy of the note (all pages) is
provided, outlining the terms and conditions of repayment. The repayment period must extend at
least three (3) years past the application date of the loan.
4.9 Rental Income
In order to use rental income for qualification, all applicable transactions (2–4-unit primary
residences and all investment properties) will require a rental income analysis to determine a
positive or negative cash flow. Rental income on a second-home transaction is not allowed. One of
the following is required to support leases or rental income on the application:
• Rent Survey Form 1007 or Form 1025 (only required for subject property); or
• Federal income tax returns (1040s) with Schedule E.
Actual rents must be documented with copies of the signed lease agreements. Net cash flow for
properties, other than the subject property, will be calculated using Schedule E from the Borrower’s
federal tax returns (1040s) for the past two (2) years.
A positive cash flow will be added to gross income; negative cash flow will be added to total
liabilities and used to qualify the Borrower(s).
Room rents will not be considered as income for qualifying purposes.
A loan for an investment property generating a negative cash flow will be closely scrutinized and
should present adequate purpose for the Borrower’s circumstances.
Rental income received from a family member may not be used as income without copies of a
minimum six (6) months’ cancelled rental checks provided by the tenant/family member.
Non-QM Mortgage Program
Purchase Eligibility Guidelines
06/22/20 Confidential and Proprietary Page 11 of 44
Income received from rental properties will be calculated using one of the following methods:
Owned at least one (1) year – For properties owned for one or more tax years, cash flow can be
calculated in one of the following manners:
• 75% of actual rents, established by copies of signed leases; or
• Net income from 1040 tax return Schedule E, plus depreciation.
Owned less than one (1) year – For properties owned less than one tax year, cash flow must be
based on 75% of the lesser of actual the actual or market rents.
Rental income from a new investment property purchase transaction can be used to qualify using
75% of the current lease (must document proof of the security deposit) minus the full PITIA
(principle, interest, taxes, insurance, and association dues). If there isn’t an existing lease, 75% of the
appraiser’s opinion on the appraisal minus the full PITIA will be used.
4.10 Short-Term Rental Income
One of the following is required to support leases or rental income on the application:
• Rental Survey Form 1007 or Form 1025(only required for subject property); or
• Federal income tax returns (1040s) with Schedule E (follow Agency guidelines).
* Must provide proof that short-term rentals are allowed in the municipality (city
website/appraiser).
Note: The above applies to standard program only.
4.11 Restricted Stock (RSUs)
SCL will only consider restricted stock that was awarded in prior two (2) years and became
unrestricted (vested) in the current year. The vesting schedule must indicate the income will
continue for a minimum of three (3) years at a similar level to the prior two (2) years. Continuance is
based on the vesting schedule using a stock price based on the fifty-two (52)-week low for the most
recent twelve (12) months’ reporting at the time of closing.
RSU income is calculated using a two (2)-year average. If RSU income is declining, proof of stability
must be provided, and the most conservative average used for qualifying.
The following documentation is required:
• Copy of the vesting schedule, and
• Most recent W-2 and pay stub.
Private stock is not eligible; employer must be a publicly traded entity.
4.12 Trust Income
Trust income may only be derived from an irrevocable trust or a revocable trust where a Borrower
who is the beneficiary has also established the trust. In order to verify trust income, a complete copy
of the original trust agreement showing the terms and conditions of the income that will be received
must be provided.
Non-QM Mortgage Program
Purchase Eligibility Guidelines
06/22/20 Confidential and Proprietary Page 12 of 44
In lieu of the copy of the trust agreement, a certification letter from the trust administrator may be
obtained, outlining the total income paid to the Borrower, method of payment, duration of the trust
and any non-taxable portion is required. Receipt of this income must be verified to continue for at
least three (3) years past the date of the application.
Except for what is stated in these guidelines, the product will default to Fannie Mae manual
underwriting guidelines for acceptable sources of income for qualification purposes. Please
reference the “Employment and Other Sources of Income” section of the Selling Guide: Fannie Mae
Single Family (Section B3-3.1) for additional information regarding trust income.
급여를 받는 차용자
포트폴리오 프로그램 매트릭스
고용으로 인한 급여 소득은 차용자가 여러 직업을 가지고 있는 경우 관련 분야에서 발생해야 합니다. 어떤 경우에는 고용주가 건설업이나 농장 노동자(계절 소득)와 같은 특정 직위에 대해 연중 고용을 제공하지 않습니다. 안정적인 수입에 대한 평가는 차용자가 나열된 고용주로부터 지속적으로 유사한 금액의 수입을 창출할 수 있는지 여부를 기반으로 해야 합니다.
소득이 안정적인 것으로 확인되면 다음 단계는 대출 상환의 기준으로 신뢰할 수 있는 소득을 나타내는 검증된 정보로부터 소득 수치를 개발하는 것입니다.
초과 근무, 보너스, 커미션 또는 기타 허용 가능한 출처의 형태로 추가 보상에 특별한 주의를 기울여야 합니다.
차용자가 계속 벌어들일 금액을 나타냅니다. 소득이 안정적인지 판단하기 위해 이러한 출처의 소득 차이를 주의 깊게 평가해야 합니다.
급여를 받는 차용자의 경우 소득을 확인하려면 가장 최근 2년 동안의 W-2 명세서와 함께 최소 1개월의 연간 누계(YTD) 소득을 다루는 급여 명세서가 필요합니다.
부업 소득은 최소 1개월 YTD 소득과 가장 최근 2년 W-2 명세서를 포함하는 급여 명세서를 받아야 합니다. 자격 요건을 위해 부업 소득은 W-2의 2년 평균을 기준으로 합니다.
기본 소득의 25%를 초과하는 수수료, 보너스 또는 초과 근무 소득과 관련하여 FNMA 지침을 따르십시오. 일반적으로 가장 최근 2년 기간에 대한 YTD 급여 명세서와 W-2 또는 고용 증명서(VOE)가 필요합니다.
판매 가이드의 “고용 및 기타 소득원” 섹션을 참조하십시오.
소득 문서 및 자격 지침에 관한 추가 정보는 Fannie Mae Single Family에게 문의하십시오.
소득 문서 옵션(전체 문서)
4.1 급여를 받는 차용자
포트폴리오 프로그램 매트릭스
고용으로 인한 급여 소득은 차용자가 여러 번 보유하고 있는 경우 관련 분야에서 발생해야 합니다.
일자리. 어떤 경우에는 고용주가 특정 직책에 대해 연중 내내 고용을 제공하지 않습니다.
건물 무역 또는 농장 노동자로 (계절 소득). 안정적인 수익에 대한 평가는 다음과 같아야 합니다.
차용자가 비슷한 금액의 소득을 지속적으로 창출할 수 있는지 여부에 따라
나열된 고용주로부터.
소득이 안정적인 것으로 결정되면 다음 단계는 다음 단계에서 소득 수치를 개발하는 것입니다.
대출 상환을 위한 기초로서 신뢰할 수 있는 수입을 나타내는 검증된 정보.
비 QM 모기지 프로그램
구매 자격 지침
06/22/20 기밀 및 독점 페이지 8/44
초과 근무, 보너스,
수수료 또는 기타 허용 가능한 출처에서
차용자가 계속 벌어들일 금액을 나타냅니다. 이 출처의 수입 차이
소득이 안정적인지 판단하려면 신중하게 평가해야 합니다.
급여를 받는 차용자의 경우 최소 한(1) 개월의 연간 누계(YTD) 소득을 포괄하는 급여 명세서,
가장 최근 2년의 W-2 명세서와 함께 소득을 확인해야 합니다.
부업 소득은 최소 1개월의 YTD 소득을 포함하는 급여 명세서를 받아야 합니다.
및 가장 최근 2년 W-2 명세서. 자격 목적을 위해 두 번째 직업 소득은
W-2의 2년 평균을 기준으로 합니다.
25% 이상의 수수료, 보너스 또는 초과 근무 소득과 관련하여 FNMA 지침을 따르십시오.
기본 소득. 일반적으로 가장 최근의 두(2)개를 다루는 YTD 급여 명세서와 W-2가 필요합니다.
년 기간 또는 고용 증명서(VOE).
판매 가이드의 “고용 및 기타 소득원” 섹션을 참조하십시오.
소득 문서 및 관련 추가 정보는 Fannie Mae Single Family
자격 지침.
4.2 자영업 차용자
자영업 차용자는 소유권이 25% 이상인 개인으로 식별됩니다.
사업에 대한 관심. 자영업자를 분석할 때 다음 요소를 고려해야 합니다.
빌어 쓰는 사람:
• 차용자의 소득 안정성;
• 차용자의 사업의 위치와 성격;
• 기업이 제공하는 제품 또는 서비스에 대한 수요;
• 사업의 재정적 건전성; 그리고
• 계속해서 충분한 소득을 창출하고 분배할 수 있는 기업의 능력
차용자가 요청한 모기지론에 대해 지불할 수 있도록 합니다.
자영업 차용자는 최소 2년 동안 사업을 했어야 합니다.
자격.
자영업 차용자는 가장 최근 2년 동안의 개인 세금을 제공해야 합니다.
보고서(모든 일정) 및 2년 사업 세금 보고서(해당되는 경우)(예: Partnership, LLC, Scorporation 또는 C-Corporation). 또한 다음이 필요합니다.
• 최신 Schedule C 또는 사업세 신고 후 120일 이상 경과한 경우
수익률, 날짜가 기입된 YTD 미감사 손익(P&L) 명세서;
• 지난 2년 동안 사업이 존재했다는 증거(즉, 공인 공공
회계사(CPA 서신); 그리고
• 가장 최근 2년 동안의 서명된 4506-T 및 1040 세금 증명서(
비즈니스 반품에 필요).
비 QM 모기지 프로그램
구매 자격 지침
06/22/20 기밀 및 독점 페이지 9/44
4.3 고정 수입
이것은 사회 보장(부양 가족의 사회 보장 포함)과 같은 소득원에 적용됩니다.
장애 수당(임시 또는 영구), VA 장애, 퇴직/연금 또는 위자료/자녀
지원하다. 이 소득이 차용자(들)의 자격을 위해 사용되는 경우, 소득 증빙 및
신청일로부터 최소 3년 동안 계속될 확률은 다음과 같아야 합니다.
제공.
참고: 출산 등의 사유로 현 직장에서 임시 휴직 중인 차용자
또는 육아 휴가, 단기 장애 및 기타 임시 휴가 유형으로 간주됩니다.
법에 의해 허용되고/또는 차용자의 고용주는 Fannie Mae’s에 정의된 임시 휴가 소득에 대한 Fannie Mae 지침에 따라 사례별로 적격성 고려 대상이 됩니다.
판매 가이드, B3-3.1-09, 기타 수입원.
고정 소득 출처가 비과세 소득으로 확인되면 다음과 같이 조정되거나 “가산”될 수 있습니다.
125%, 단:
• 가처분 소득/잔여 소득을 결정하는 데 순소득만 사용됩니다. 메디케어와
보험료는 생략한다.
• 차용자(들)는 소득을 합산하여 적격 자격을 얻은 결과 분명히 이익을 얻습니다. 그리고
• 차용자의 순이익(총계산 전)은 모든 부채를 갚기에 충분합니다.
총계산이 허용되지 않는 비과세 소득에는 다음이 포함됩니다.
• 외국인 근로 소득,
• 위탁 양육 소득,
• 주택 수당.
4.4 자본 이득 및 손실
일회성 자본 이득 또는 손실
by usezloan | Aug 12, 2021 | Financial study
융자지식205- NON-QM A UNDERWRITING GUIDELINES 3
소득 자격
3.1 적절하고 안정적인 수입
소득 및 고용 분석은 인수 프로세스의 핵심 요소이며 반드시 사용되어야 합니다.
차주의 상환 능력이 합리적인지 판단하기 위해. 소득 서류
이를 위해 차용자가 제공한 자료를 검토하고 확인해야 합니다. 추가적으로 소득
안정적이고 계속될 가능성이 있으며 차용자가 상환할 수 있도록 충분한 것으로 간주되어야 합니다.
적시에 부채.
비 QM 모기지 프로그램
구매 자격 지침
감소하는 소득원은 소득이 다음 용도로 사용될 수 있는지를 결정하기 위해 면밀히 검토되어야 합니다.
자격 목적. 감소에 대한 설명을 얻어야 합니다. 가 있는 경우
소득의 사용을 지원하기에 충분한 정보, 가장 최근의 더 낮은 소득이 사용되어야 합니다
자격을 위해.
고용은 동일 직종 또는 동일 계열에서 최소 2년의 경력으로 안정적이어야 합니다.
일의. 자영업 차용자는 최소 2년 연속 사업을 했어야 합니다.
차용자는 1개월을 초과하는 고용 격차를 서면으로 설명해야 합니다.
차용인은 현재 고용되어 있어야 합니다.
3.2 ATR 문서
ATR 표준 준수에 대한 문서 증거를 유지하는 것은 매우 중요합니다.
대출 파일은 차용자의 상환 능력을 문서화해야 하며 그렇지 않으면 대출 자격이 없습니다.
SCL에서 구매.
3.3 소득 대비 부채 비율 요건
소득 대비 부채 비율(DTI)은 차용자의 월간 총 부채를 다음으로 나누어 계산합니다.
차용인의 총 월 적격 소득. SCL은 별도의 주거비를 사용하지 않습니다.
비율(즉, 프론트 엔드 비율)이 아니라 ATR 규칙에 정의된 대로 모든 부채를 롤업합니다. 허용 DTI
비율은 12개월 준비금으로 45% 또는 50%입니다.
LTV 최대 DTI
60% 이하 45% 또는 50%(12개월 적립금 포함)
참고: 처음 주택 구입자는 SCL의 대안 중 하나를 사용할 때 43% DTI로 제한됩니다.
문서(Alt-Doc) 프로그램.
3.4 잔여 소득 요건
DTI 비율이 43% 이하인 대출은 잔여 소득이 필요하지 않습니다. DTI가 43.01% 이상인 대출에는 잔존금이 필요합니다.
소득. 잔여 소득은 모든 월별 의무가 종료된 후 남은 현금 흐름으로 정의됩니다.
지불되었습니다. 요건 = 모기지 미지급 원금 잔액의 0.0045(0.45%)(즉,
UPB x 0.0045 = 필요한 잔여 소득).
Income Qualifying
3.1 Adequate and Stable Income
Income and employment analyses are key elements of the underwriting process and must be used
to determine whether the Borrower’s ability to repay is reasonable. Income documentation
provided by the Borrower must be reviewed and verified for this purpose. Additionally, the income
must be considered stable, likely to continue, and sufficient to enable the Borrower to repay the
debt in a timely manner.
Non-QM Mortgage Program
Purchase Eligibility Guidelines
06/22/20 Confidential and Proprietary Page 7 of 44
Declining income sources should be closely reviewed to determine if the income may be used for
qualifying purposes. An explanation for the decline should be obtained. In instances where there is
sufficient information to support the use of the income, the most recent lower income must be used
for qualification.
Employment should be stable with at least a two (2)-year history in the same job or in the same line
of work. Self-employed Borrowers must have been in business for at least two (2) consecutive years.
The Borrower(s) must explain in writing any employment gaps that exceed one (1) month.
Borrowers must be currently employed.
3.2 ATR Documentation
Maintaining documentary evidence of compliance with the ATR standards is of critical importance.
The loan file must document the Borrower’s ability to repay or the loan will be ineligible for
purchase by SCL.
3.3 Debt-to-Income Ratio Requirements
The debt-to-income (DTI) ratio is calculated by dividing the Borrower’s total monthly obligations by
the Borrower’s total monthly qualifying income. SCL does not utilize a separate housing expense
ratio (i.e., front-end ratio), but rather rolls up all debts as defined by ATR rules. The allowable DTI
ratio is 45% or 50% with 12 months reserves.
LTV Maximum DTI
60% or below 45% or 50% with 12 months reserves
Note: First-time homebuyers are limited to a 43% DTI when using one of SCL’s Alternative
Documentation (Alt-Doc) programs.
3.4 Residual Income Requirement
Loans with DTI ratios of ≤ 43% require no residual income. Loans with DTI ≥ 43.01% require residual
income. Residual income is defined as the cash flow remaining after all monthly obligations have
been paid. The requirement = 0.0045 (0.45%) of the unpaid principal balance of the mortgage (i.e.,
UPB x 0.0045 = required residual income).
by usezloan | Aug 12, 2021 | Financial study
융자지식204- NON-QM A UNDERWRITING GUIDELINES 2
Non-Warrantable Condominiums
Non-warrantable condominiums are allowed with the following parameters:
Condominium Project Questionnaire – A completed questionnaire is required.
Commercial Space – Commercial space acceptable in projects up to 40%.
Completion Status – The project, or the subject’s legal phase along with other phases, must be
complete. All common elements in the project or legal phase must be 100% completed. At least 50%
must be sold or under a bona-fide contract.
Delinquent HOA Dues – No more than 20% of the total units in the project may be 60 days or more
past due on HOA dues.
Investor Concentration – Investor concentration up to 60% is allowed. Higher percentages may be
considered on investment property transactions when an established history of a high percentage of
rental units in the condo project can be demonstrated.
HOA Control – The developer may be in control of the condominium association provided the
Master Agreement provides for the homeowners to take control upon either a predetermined
percentage of unit sales or within a defined time period.
Litigation – Projects involved in litigation are acceptable if the pending lawsuit(s) are not structural
in nature, do not affect the marketability of the units, and:
Potential damages do not exceed 25% of the HOA reserves; or
Documentation is provided by the insurance carrier or the attorney representing the
insurance carrier that the insurance carrier has agreed to provide the defense and the
association’s insurance policy is enough to cover the litigation.
Single-Entity Ownership – Single entity may own up to 30% of units in the project.
무보증 콘도미니엄
보증할 수 없는 콘도미니엄은 다음 매개변수와 함께 허용됩니다.
콘도미니엄 프로젝트 설문지 – 완성된 설문지가 필요합니다.
상업 공간 – 프로젝트에서 최대 40%까지 허용되는 상업 공간.
완료 상태 – 프로젝트 또는 다른 단계와 함께 주제의 법적 단계는 다음과 같아야 합니다.
완벽한. 프로젝트 또는 법적 단계의 모든 공통 요소는 100% 완료되어야 합니다. 최소 50%
판매하거나 선의의 계약에 따라야 합니다.
연체 HOA 회비 – 프로젝트의 총 단위 중 20%를 넘지 않아야 60일 이상이 될 수 있습니다.
HOA 회비 연체.
투자자 집중 – 투자자 집중은 최대 60%까지 허용됩니다. 더 높은 비율은
높은 비율의 확립된 이력이 있는 경우 투자 부동산 거래에서 고려됩니다.
콘도 프로젝트의 임대 단위를 시연할 수 있습니다.
HOA 제어 – 개발자는 다음 조건에 따라 콘도미니엄 협회를 제어할 수 있습니다.
마스터 계약은 주택 소유자가 미리 결정된
단위 판매의 백분율 또는 정의된 기간 내.
소송 – 계류 중인 소송이 구조적이지 않은 경우 소송과 관련된 프로젝트가 허용됩니다.
본질적으로 단위의 시장성에 영향을 미치지 않으며 다음을 수행합니다.
잠재적 손해는 HOA 예비의 25%를 초과하지 않습니다. 또는
문서는 보험사 또는 대리인을 대리하는 변호사가 제공합니다.
보험회사가 방어 및 방어를 제공하기로 동의한 보험회사
협회의 보험 정책은 소송을 커버하기에 충분합니다.
단일 엔티티 소유권 – 단일 엔티티는 프로젝트 단위의 최대 30%를 소유할 수 있습니다.
by usezloan | Aug 12, 2021 | Financial study
융자지식203- NON-QM A UNDERWRITING GUIDELINES 1
What is a non-qualified mortgage?
A non-qualified mortgage (non-QM) is a home loan designed to help homebuyers who can’t meet the strict criteria of a qualifying mortgage. For example, if you are self-employed or don’t have all the necessary documentation to qualify for a traditional mortgage, you might need to look at non-qualified mortgages.
The best way to understand a non-qualifying mortgage is to look at the criteria for traditional, qualifying mortgages. To qualify for a traditional mortgage, you must meet these requirements:
Income: You must have verifiable income, including pay stubs, W-2s, and tax returns.
Debt: Your debt-to-income ratio (DTI) must be 43% or less. This is the amount of your monthly income that goes toward your existing debts.
Limits on fees: Points and fees on your loan cannot exceed 3% of the loan amount.
No risky loan features: Risky features include interest-only loans (where you only pay interest without reducing the principal), negative amortization (where your principal can increase, even while you are making payments), or balloon payments (where a larger payment can be tacked on to the end of the loan).
Loan term: The loan term must be 30 years or less.
적격 모기지론이란 무엇입니까?
비적격 모기지(비 QM)는 적격 모기지의 엄격한 기준을 충족할 수 없는 주택 구입자를 돕기 위해 고안된 주택 융자입니다. 예를 들어, 자영업자이거나 기존 모기지 자격에 필요한 모든 서류가 없는 경우 비적격 모기지를 살펴봐야 할 수 있습니다.
비적격 모기지를 이해하는 가장 좋은 방법은 전통적인 적격 모기지의 기준을 살펴보는 것입니다. 기존 모기지 자격을 갖추려면 다음 요구 사항을 충족해야 합니다.
소득: 급여 명세서, W-2 및 세금 신고서를 포함하여 확인 가능한 소득이 있어야 합니다.
부채: 소득 대비 부채 비율(DTI)은 43% 이하여야 합니다. 이것은 귀하의 기존 부채에 대한 월 소득 금액입니다.
수수료 한도: 포인트 및 대출 수수료는 대출 금액의 3%를 초과할 수 없습니다.
위험한 대출 기능 없음: 위험한 기능에는 이자 전용 대출(원금을 줄이지 않고 이자만 지불하는 경우), 마이너스 할부 상환(원금을 지불하는 동안에도 원금이 증가할 수 있는 경우) 또는 벌룬 지불(더 많은 금액을 지불할 수 있는 경우)이 포함됩니다. 대출이 끝날 때까지 고정).
대출기간 : 대출기간은 30년 이하여야 합니다.
1 일반 구매 자격
1.1 개요
이 가이드라인은 거래 대출 기관에 방향과 일관성을 제공하기 위해 고안되었습니다.
에 판매할 투자 품질의 비적격 모기지(“Non-QM”) 대출을 시작하고자 합니다.
Silvergate Bank(“Silvergate”)의 특파원 대출 부서(“SCL”).
1.2 폐쇄 대출만
특파원과 SCL이 대출을 종료한 후에만 대출을 구매합니다.
신용, 평가, 마감 및 담보를 포함한 전체 파일을 검토하고 승인했습니다.
서류.
1.3 상환 능력(ATR)
연방 진실이 적용되는 개인, 가족 또는 가계 목적을 위한 모기지 대출의 경우
대출법(TILA)에서 ATR 규칙은 대출 기관이 선의를 행했음을 입증하도록 요구합니다.
확인된 제3자 기록에 기초하여 차용자가 충분한 소득을 가지고 있고
일반적으로 다음 8가지 기준을 고려하여 조건에 따라 대출을 상환할 자산:
• 현재 또는 합리적인 예상 소득 또는 자산;
• 현재 고용 상태;
• 해당 거래에 대한 월별 지불금;
• 동시 대출에 대한 월별 지불;
• 모기지 관련 의무에 대한 월별 지불금;
• 현재 채무, 위자료 및 자녀 양육비;
• 신용 기록; 그리고
• 소득 대비 부채 비율.
SCL에서 구매를 고려하는 모든 대출은 ATR 규칙을 충족해야 합니다. 일부 대출은 면제될 수 있습니다.
TILA 또는 ATR에서 면제됩니다. SCL이 그러한 대출(예: 투자
재산), 차용자가 신중한 기준에 따라 대출을 감당할 수 있는 것으로 보이는 경우에만 그렇게 할 것입니다.
인수 기준.
1.4 수동 인수 요건
특파원은 모든 대출에 대해 포괄적인 인수를 요구하여
ATR 요건 준수를 문서화하고 정보에 입각한 신용/대출 결정을 내리십시오.
특파원의 인수 승인 및 차용인의 결정에 대한 증거
ATR 요구 사항을 충족하는 것은 대출 파일에 포함되어야 합니다.
비 QM 모기지 프로그램
구매 자격 지침
06/22/20 기밀 및 독점 페이지 2/44
1.5 QM 검토
Fannie Mae 또는 Freddie Mac 승인을 받을 수 있는 대출은 SCL에 판매할 수 없습니다.
비 QM 대출. 대출은 Fannie Mae의 Desktop Underwriter 또는
Freddie Mac의 Loan Prospector는 차용자가 적격 모기지를 받을 자격이 없는지 확인합니다.
(QM). AUS 결과는 “참조” 또는 “승인/부적격”이어야 하며, 그렇지 않은 경우 특파원
완성된 비 QM 대출 자격 양식을 제공해야 합니다.
특정 측면에서 이 가이드라인에 정의된 SCL의 비QM 프로그램 매개변수는 서로 다릅니다.
다음을 포함하되 이에 국한되지 않는 FNMA(연방 모기지 협회)
• DTI 비율,
• 최대 대출 금액,
• 예약 요건,
• 최소 FICO,
• 총 대출 금액 및
• 자영업 문서.
대출 프로그램 유형
• 기존 5/1 Libor ARM 및 5/1 Libor ARM 이자만(1년 Libor 지수 기준,
5-2-5 금리 상한선 하한선은 마진과 동일).
1.6 적격 요율(ARM)
소득에 대한 시작 요율 또는 완전 연동 요율(즉, 현재 지수 + 마진) 중 큰 금액으로 자격
비율 계산. 이자 전용 프로그램에도 동일한 규칙이 적용됩니다(동일한 기준 사용
다만, 이자만 부과된 기간 이후 잔여기간에 걸쳐 상각한다.
1.7 Fannie Mae 지침 참조
인수 목적으로, 주제 또는 지침이 이 지침에서 구체적으로 언급되지 않은 경우,
해당 주제/지침은 기본적으로 다음과 같은 표준 Fannie Mae 언더라이팅 지침으로 설정됩니다.
Fannie Mae 판매 가이드, 파트 B: 시작부터 마감까지 정의
(https://www.fanniemae.com/content/guide/sales/b/index.html).
1.8 사기 방지 제로
SCL은 사기와 관련하여 무관용 정책을 가지고 있습니다. 기자는 자신의 의견을 따라야 합니다.
사기를 방지하고 탐지하기 위해 모든 대출에 대해 사기 및 신원 확인 절차를 수립했습니다(다음을 포함하지만
사회 보장 번호 확인, 고용의 구두 확인, 처리
4506-T 등). 사기 문서 또는 정보가 포함된 대출은 즉시
거절했다. 발신자 참여가 결정되면 발신자는 비활성화됩니다.
연방 은행 비밀법에서 요구하는 모든 보고서가 제출됩니다. SCL은 차용자를 추구합니다
법의 최대한의 범위에서 사기.
비 QM 모기지 프로그램
구매 자격 지침
06/22/20 기밀 및 독점 페이지 3/44
1.9 공정 대출 정책
SCL은 공정 주택법 및 평등한 신용 기회의 조항에 따라 운영됩니다.
법(ECOA). 공정 주택법은 주택 관련 활동에 대한 차별을 불법으로 규정하고 있습니다.
인종, 피부색, 종교, 출신 국가, 성별, 장애 또는 가족 상태를 이유로 사람을 상대로 하는 행위.
ECOA는 신용 거래의 모든 측면과 관련하여 성별을 근거로 한 차별을 금지합니다.
인종, 피부색, 종교, 출신 국가, 결혼 여부, 나이(차용자가
NS
구속력 있는 계약을 체결), 공공 지원을 받거나 차용자가
믿음은 소비자 신용 보호법에 따라 모든 권리를 행사했습니다. SCL은 문자를 완벽하게 지원하며
이 두 가지 법의 정신을 따르며 모기지 거래에서 차별을 용납하지 않습니다.
1.10 포인트 및 수수료
총 포인트, 수수료 및 APR은 현재 주 및 연방 고비용 임계값을 초과할 수 없습니다.
1.11 고가 모기지론(HPML) 자격
더 높은 가격의 모기지론은 필요한 모든 조건을 충족하는 SCL에서 구매할 수 있는 것으로 간주됩니다.
공개가 제공되고 HPML 평가 규칙 준수가 충족됩니다. 모든 HPML의 경우
재산세 및 보험에 대한 에스크로 계정은 최소
5 년.
1.12 HOEPA 고비용(섹션 32) 대출 부적격
적용 가능한 지역, 주, 연방 및 보조 기관에서 정의한 고비용(섹션 32) 모기지 대출
시장 규정에 따라 구매할 수 없습니다.
1.13 부적격 대출 특징
다음 기능은 허용되지 않습니다.
• 선납 벌금(투자 부동산 제외),
• 마이너스 상각,
• 풍선 지불,
• CEMA(NY)와의 대출 마감.
1.14 베스팅
소유권은 개인 또는 생체 내 취소 가능 신탁의 이름으로 단순 수수료여야 합니다. (LLC
금지됨) 예외: DSCR 및 투자 대출은 LLC에서 마감될 수 있습니다.
1.15 Inter Vivos 취소 가능 신탁
생체 신탁이라고도 하는 Inter vivos 취소 가능 신탁은 특정 조건에 따라 구매할 수 있습니다.
정황. 이 섹션에서 다루지 않은 사항에 대해서는 Fannie Mae 요구 사항을 참조하십시오.
• 신탁은 한 명 이상의 자연인이 단독으로 또는 공동으로 설립해야 합니다. 첫째의
신탁의 수혜자는 신탁을 설립한 개인이어야 합니다. 만약 신뢰가
공동으로 설립된 경우 소득이나 자산이
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신탁을 설립한 개인 중 최소한 한 명이
저당.
• 부동산은 주 거주지, 두 번째 주택 또는 투자 부동산일 수 있습니다.
• 수탁자는 재산에 대한 법적 소유권을 보유하고 저당할 수 있는 권한이 있어야 합니다. 이것은 반드시
신탁에 명시해야 합니다.
1.16 신탁 계약 요건
판매자는 신탁 또는 신탁 증명서의 사본을 입수하여 대출 파일에 포함시켜야 합니다.
구매를 위해 제출했습니다. 사본은 변호사 또는 양도인/신탁인/설정자의 인증을 받아야 합니다.
소유권 회사는 신탁 사본도 제공해야 합니다.
계약이 다음을 모두 충족하는지 확인하려면 신탁 계약을 검토해야 합니다.
요구 사항:
• 신탁은 단독 또는 공동으로 한 명 이상의 자연인에 의해 설립되었습니다. 사람
신탁을 설정하는 것을 “Settlor”, “Trustor” 또는 “Grantor”라고 하며, 이하에서는 다음과 같이 지칭합니다.
“세틀러.”
• 신탁은 청산인의 평생 동안 유효합니다.
• 정산자는 신탁의 주요 수혜자입니다. Settlor가 둘 이상인 경우
둘 이상의 주요 수혜자가 될 수 있습니다.
• 설정자는 수탁자 또는 공동 수탁자 중 한 명입니다.
• 수탁자는 담보를 확보할 목적으로 대상 재산을 저당할 수 있는 권한을 가집니다.
어음의 차용인인 당사자(또는 당사자)에 대한 대출.
• 수탁자는 모기지에 대해 수혜자로부터 서면 동의를 받을 필요가 없습니다.
서면 동의가 제공된 경우 대상 자산.
• 대출을 받기 위해 필요한 분배와 같은 대출 기관의 권리에 대한 비정상적인 위험이나 손상이 없습니다.
순이익 이외의 특정 금액으로 이루어집니다.
• 신탁은 연방, 주 및 지역 법률에 따라 유효합니다.
• 신탁 계약에 두 명 이상의 수탁자가 돈을 빌리거나 구매하도록 요구하는 경우,
부동산을 건설하거나 담보로 설정하는 경우 판매자는 필요한 수탁자 수를 확인해야 합니다.
대출 서류에 서명했습니다.
1.17 위임장
위임장(POA)을 통해 마감된 대출은 사례별로 검토됩니다.
1.18 지침 예외
게시된 지침에 대한 예외는
차용인의 인종, 피부색, 종교, 출신 국가, 성별, 장애 또는 결혼 여부. 대출
예외 요청은 강력한 보상 요소를 나타내야 합니다. 예외 요청은 다음과 같아야 합니다.
서면으로 제출했습니다. 예외 요청을 허용하거나 거부하는 SCL의 결정은
비 QM 모기지 프로그램
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SCL은 대출을 구매하고 기본 결정과 관련하여 특파원을 구속하지 않습니다.
신용을 연장합니다.
1.19 최소/최대 대출 금액
최소 대출 금액은 $50,000이고 최대 대출 금액은 $2,000,000입니다. 프로그램 매트릭스 참조
신용 점수 및 가치 대비 대출(LTV) 비율을 기반으로 한 소액 한도.
1.20 가정 가능성
대출은 초기 고정 금리 기간 이후에 자격을 갖춘 차용자가 인수할 수 있습니다.
1.21 부적격 국가
다음 지역에 위치한 부동산은 SCL에서 구매할 수 없습니다.
• 네
w 요크;
• 텍사스(현금 재융자만 가능, 기타 모든 거래 허용);
• 미국 영토; 그리고
• 모든 경우에 주별 규정이 SCL 지침을 대체합니다.
1.22 비정상 거래
비정상 거래는 가족 구성원 간의 거래입니다.
혈연, 결혼, 입양 또는 법적 후견인), 동료, 친구 또는
목록 에이전트, 건축업자, 모기지 대출 기관 또는 중개인과 같은 거래. 팔길이가 아닌
거래는 SCL의 단독 재량에 따라 이 프로그램에 따라 구매할 수 있습니다. 비정상 거래가 구매에 대해 승인되면 SCL은 두 번째 평가 또는 기타
가치 검증이 제공됩니다.
1.23 부적격 자산 유형
부적격 속성에는 다음이 포함되지만 이에 국한되지는 않습니다.
• 임대 부동산,
• 협동조합,
• 콘도텔,
• 시분할,
• 소득을 창출하는 기업(농장, 민박, 생활 보조),
• 제조 주택,
• 통나무 집,
• 5에이커를 초과하는 부동산은 경우에 따라 20에이커를 초과하지 않아야 합니다.
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1.24 한 명의 차용자에 대한 대출
SCL에서 1명의 차용자에 대한 대출은 부동산 5개 및/또는 $3,000,000를 초과할 수 없습니다.
최대 융자 재산 – 차용자는 총 15개까지 융자를 받을 수 있습니다.
대상 부동산을 포함한 모든 대출 기관의 주거용 부동산.
1 General Purchase Eligibility
1.1 Overview
These guidelines are designed to provide direction and consistency for correspondent lenders
wishing to originate investment-quality non-qualified mortgage (“Non-QM”) loans for sale to
Silvergate Bank’s (“Silvergate”) Correspondent Lending Division (“SCL”).
1.2 Closed Loans Only
A loan will only be purchased by SCL after the loan has been closed by the Correspondent and SCL
has reviewed and approved the complete file, including credit, appraisal, closing, and collateral
documents.
1.3 Ability to Repay (ATR)
For mortgage loans made for a personal, family, or household purpose covered by the federal Truth
in Lending Act (TILA), the ATR rule requires lenders to demonstrate they have made a good faith
determination based on verified third-party records that the Borrower has sufficient income and
assets to repay the loan according to its terms, generally considering the following eight criteria:
• Current or reasonable expected income or assets;
• Current employment status;
• Monthly payment on the covered transaction;
• Monthly payment on any simultaneous loan;
• Monthly payment for mortgage-related obligations;
• Current debt obligations, alimony, and child support;
• Credit history; and
• Debt-to-income ratio.
All loans considered for purchase by SCL must meet ATR rules. Certain loans may be exempt from
TILA or otherwise exempt from the ATR. If SCL chooses to purchase such a loan (e.g., investment
property), it will only do so if the Borrower appears able to afford the loan based on prudent
underwriting standards.
1.4 Manual Underwriting Requirement
Comprehensive underwriting is required by the Correspondent on every loan to ensure and
document compliance with ATR requirements and to make a well-informed credit/lending decision.
The Correspondent’s underwriting approval and evidence of its determination that the Borrower
meets ATR requirements must be included in the loan file.
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1.5 QM Review
Loans that are eligible for Fannie Mae or Freddie Mac approval are ineligible for sale to SCL as a
Non-QM loan. Loans must be submitted through either Fannie Mae’s Desktop Underwriter or
Freddie Mac’s Loan Prospector to ensure the Borrower does not qualify for a qualified mortgage
(QM). AUS findings must be either “Refer” or “Approve/Ineligible,” otherwise, the Correspondent
must provide a completed Non-QM Loan Eligibility form.
In certain respects, the parameters of SCL’s Non-QM programs, as defined in these guidelines, differ
from those of the Federal National Mortgage Association (FNMA), including but not limited to:
• DTI ratios,
• Maximum loan amounts,
• Reserve requirements,
• Minimum FICOs,
• Aggregate loan amounts, and
• Self-employed documentation.
Loan Program Types
• Conventional 5/1 Libor ARM and 5/1 Libor ARM interest only (based on 1-year Libor index;
5-2-5 interest rate caps; floor rate equals the margin).
1.6 Qualifying Rate (ARMs)
Qualify at the greater of the start rate or fully indexed rate (i.e., current index + margin) for income
ratio calculations. The same rule applies to the interest-only programs (using the same criteria
mentioned above), but it will be amortized over the remaining period after the interest-only period.
1.7 Fannie Mae Guideline Reference
For underwriting purposes, if a topic or guideline is not specifically addressed in these guidelines,
the applicable topic/guideline will default to standard Fannie Mae underwriting guidelines as
defined in the Fannie Mae Selling Guide, Part B: Origination Through Closing
(https://www.fanniemae.com/content/guide/selling/b/index.html).
1.8 Zero Fraud Tolerance
SCL has a zero-tolerance policy as it relates to fraud. Correspondents should follow their own
established fraud and identity procedures on every loan to prevent and detect fraud (including, but
not limited to, Social Security number verification, verbal verifications of employment, processing of
4506-T, etc.). Loans containing fraudulent documentation or information will immediately be
declined. If there is a determination of originator involvement, the originator will be made inactive
and any reports required by the federal Bank Secrecy Act will be filed. SCL will pursue Borrower
fraud to the fullest extent of the law.
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1.9 Fair Lending Policy
SCL operates in accordance with the provisions of the Fair Housing Act and Equal Credit Opportunity
Act (ECOA). The Fair Housing Act makes it unlawful to discriminate in housing-related activities
against any person because of race, color, religion, national origin, sex, handicap, or familial status.
ECOA prohibits discrimination with respect to any aspect of a credit transaction on the basis of sex,
race, color, religion, national origin, marital status, age (provided the Borrower has the capacity to
enter into a binding contract), receipt of public assistance, or because the Borrower has in good
faith exercised any right under the Consumer Credit Protection Act. SCL fully supports the letter and
spirit of both of these laws and will not condone discrimination in any mortgage transaction.
1.10 Points and Fees
Total points, fees, and APR may not exceed current state and federal high-cost thresholds.
1.11 Higher-Priced Mortgage Loan (HPML) Eligibility
Higher-priced mortgage loans are considered as eligible for purchase by SCL provided all required
disclosures are provided, and compliance with the HPML appraisal rule is met. For all HPMLs, an
escrow account for property taxes and insurance must be established and funded for a minimum of
5 years.
1.12 HOEPA High-Cost (Section 32) Loans Not Eligible
High-cost (Section 32) mortgage loans, as defined by applicable local, state, federal, and secondary
market regulations, are not eligible for purchase.
1.13 Ineligible Loan Features
The following features are not allowed:
• Pre-payment penalties (with the exception of investment properties),
• Negative amortization,
• Balloon payments, and
• Loans closing with CEMA (NY).
1.14 Vesting
Ownership must be fee simple in name of individual(s) or inter vivos revocable trust. (LLC
prohibited) Exception: DSCR and Investment loans can close under an LLC.
1.15 Inter Vivos Revocable Trust
Inter vivos revocable trusts, also known as living trusts, are eligible for purchase under certain
conditions. Please refer to Fannie Mae requirements for anything not addressed in this section.
• The trust must be established by one or more natural persons, solely or jointly. The primary
beneficiary of the trust must be the individual(s) establishing the trust. If the trust is
established jointly, there may be more than one primary beneficiary if the income or assets
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06/22/20 Confidential and Proprietary Page 4 of 44
of at least one of the individuals establishing the trust will be used to qualify for the
mortgage.
• The property may be a primary residence, second home or investment property.
• The trustee must have the power to hold legal title to and mortgage the property. This must
be specified in the trust.
1.16 Trust Agreement Requirements
The Seller must obtain copies of the trust or trust certification and include them in the loan file
submitted for purchase. The copies must be certified by an attorney or the grantor/trustor/settlor.
The title company must also be supplied with copies of the trust.
A review of the trust agreement is required to ensure the agreements meets all the following
requirements:
• The trust is established by one or more natural persons, solely or jointly. The person
establishing the trust is known as the “Settlor,” “Trustor,” or “Grantor,” referred to below as
“Settlor.”
• The trust is effective during the Settlor’s lifetime.
• The Settlor is the primary beneficiary of the trust. If there is more than one Settlor, there
can be more than one primary beneficiary.
• The Settlor is the trustee or one of the co-trustees.
• The trustee has the power to mortgage the subject property for the purpose of securing a
loan to the party (or parties) who are the Borrowers on the note.
• The trustee is not required to obtain written consent from the beneficiaries to mortgage the
subject property if written consent has been provided.
• There is no unusual risk or impairment of lender’s rights, such as distributions required to be
made in specified amounts other than net income.
• The trust is valid under federal, state, and local law.
• If the trust agreement requires more than one trustee to borrow money or purchase,
construct, or encumber realty, the Seller must confirm that the requisite number of trustees
have signed the loan documents.
1.17 Power of Attorney
Loans closed via a power of attorney (POA) are reviewed on a case-by-case basis.
1.18 Guideline Exceptions
Exceptions to published guidelines may be considered on a case-by-case basis without regard to
Borrower’s race, color, religion, national origin, sex, handicap, or marital status. Loans with
exception requests should exhibit strong compensating factors. Exception requests should be
submitted in writing. SCL’s decision to allow or deny any exception request relates only to whether
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06/22/20 Confidential and Proprietary Page 5 of 44
SCL will purchase a loan and does not bind a Correspondent with respect to the underlying decision
to extend credit.
1.19 Minimum/Maximum Loan Amounts
Minimum loan amount is $50,000 and maximum loan amount is $2,000,000. See Program Matrices
for sub-limits based on credit score and loan-to-value (LTV) ratio.
1.20 Assumability
Loans may be assumed by a qualified Borrower after the initial fixed-rate term.
1.21 Ineligible States
Properties located in the following geographic regions are not eligible for purchase by SCL:
• New York;
• Texas (cash-out refinancing only; all other transactions are acceptable);
• U.S. territories; and
• In all cases, state-specific regulations supersede SCL guidelines.
1.22 Non-Arm’s-Length Transactions
A non-arm’s-length transaction is a transaction between family members (related to the Borrower
by blood, marriage, adoption, or legal guardianship), co-workers, friends, or anyone associated with
the transaction, such as the listing agent, builder, mortgage lender, or broker. Non-arm’s-length
transactions may be eligible for purchase under this program at the sole discretion of SCL. If a nonarm’s-length transaction is approved for purchase, SCL may require a second appraisal or other
value validations be provided.
1.23 Ineligible Property Types
Ineligible properties include but are not limited to:
• Leasehold properties,
• Co-ops,
• Condotels,
• Timeshares,
• Income-producing enterprises (farms, bed & breakfasts, assisted living),
• Manufactured homes,
• Log homes, and
• Properties over 5 acres are case by case, not to exceed 20 acres.
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1.24 Loans to One Borrower
Loans to one Borrower from SCL may not exceed five (5) properties and/or $3,000,000.
Maximum Financed Properties – Borrowers are allowed up to a total of fifteen (15) financed
residential properties with all lenders, including subject property.
by usezloan | Aug 12, 2021 | Financial study
융자지식202- USDA A UNDERWRITING GUIDELINES
Refer to Exhibit A for Rural Housing origination instructions.
PRIMARY RESIDENCE – PURCHASE & RATE/TERM REFINANCE
Property Type 1-Unit, Condo, PUD
Maximum LTV Purchase Loans 1, 2, 3
: 101.01%
Refinance Loans 1, 3, 4
: 101.01%
Maximum Loan Amount $548,250 ($822,375 in Alaska, Hawaii and the US Virgin Islands)
Maximum Ratios
With Accept response from GUS: follow GUS findings
Manual Underwrite: 29% / 41%5
Minimum Credit Score 620
Reserves Not required but can be used as a compensating factor.
Any assets input into GUS must be verified.
Guarantee Fee
Upfront Fee
1.00% of the Gross Loan Amount
Annual Fee (Paid Monthly)
0.35%
1. The LTV is calculated as the loan amount divided by the appraised value. LTV may exceed 100% of the appraised value only by the amount of any
financed Guarantee Fee.
2. For purchase transactions, closing costs and prepaid expenses may be financed when the sales price is lower than the appraised value but the base loan
amount may not exceed the appraised value.
3. Refer to the Subordinate Financing section.
4. Refinances permitted only for existing GRH loans.
5. Refer to Chapter 11, Ratio Analysis, of RD Technical Handbook, HB-1-3555 for information regarding debt ratio waivers and compensating factors.
PROGRAM SUMMARY
The Guaranteed Rural Housing mortgage loan program offers 30-year fixed-rate mortgage financing guaranteed
by the U.S. government through USDA Rural Development (RD). Applicants must be unable to secure credit
from other sources upon terms and conditions which the applicant can reasonably fulfill. Under this definition, a
traditional conventional loan is one where:
• The applicant has available personal non-retirement liquid verifiable assets of at least 20% of the
purchase price that can be used as a down payment; and
• The applicant can, in addition to the 20% down payment, pay all closing costs associated with the loan; and
• The applicant can meet qualifying ratios of no more than 28% PITI and 36% TD when applying the 20%
down payment; and
• The applicant demonstrates qualifying credit for such a loan.
• The conventional mortgage loan term is for a 30-year fixed rate loan without a condition to obtain
private mortgage insurance (PMI).
If the applicant meets the cumulative criteria of traditional conventional credit, as defined by RD above, the
applicant is ineligible for the Guaranteed Rural Housing program. Refer to Chapter 5, Origination and
Underwriting Overview of RD Technical Handbook, HB-1-3555 for further information.
PRODUCTS OFFERED
Product Loan Term
Guaranteed Rural Housing – 30 Year Fixed 30-Year Fixed
Guaranteed Rural Housing
V. Product Guidelines 2 of 19 Document #5830
Return to Top 05/14/2021
PRICING
The GRH program is priced to the GNMA I 30Y or GNMA II 30Y pricing (depending on the desired rate) listed
on the third page of the daily price indication sheets, but subject to the maximum interest rate listed under
Government Price Adjustments.
The maximum interest rate for Guaranteed Rural Housing loans is defined by RD Instruction 440.1, Exhibit B
as the Fannie Mae posted yield for 90-day delivery (Actual/Actual) for 30-year fixed rate conventional loans
plus one percent (1.0%), rounded up to the nearest one-quarter of one percent (0.25%).
RURAL DEVELOPMENT STATE WEBSITES
Websites for state Rural Development offices can be accessed by inputting the main address, then adding the
2-letter state code. Main web address: http://www.rd.usda.gov/.
Example
State of Michigan
http://www.rd.usda.gov/mi
Connecticut, Massachusetts, and Rhode Island are all managed by the Massachusetts RD director. Therefore,
the applicable Website for all three states is http://www.rd.usda.gov/ma.
RURAL DEVELOPMENT FORMS
Rural Development forms are available at the USDA Service Center Agencies eForms site:
FORM RD 3555-21, REQUEST FOR SINGLE FAMILY HOUSING LOAN GUARANTEE
Form RD 3555-21 must be submitted to Underwriting with the initial loan submission. Borrower and coborrower must sign page two. The version dated “Rev.03-21” must be used for all loan submissions
beginning on and after May 1, 2021.
ELIGIBLE BORROWERS
• U. S. citizens
• Permanent resident aliens:
o Submit INS/CIS Form I-551, Alien Registration Receipt Card (a.k.a. green card).
o Refer to Chapter 8, Applicant Characteristics of RD Technical Handbook, HB-1-3555 for further
information.
• Non-permanent resident aliens:
o Guaranteed Underwriting System (GUS) findings must indicate applicant(s) is/are eligible aliens.
o Refer to Chapter 8, Applicant Characteristics of RD Technical Handbook, HB-1-3555 for further
information.
• Married borrowers applying without their spouse (non-purchasing spouse (NPS)):
o Income of non-purchasing spouse must be verified and included in the household income
calculation to determine if household is income eligible. However, the non-purchasing spouse’s
income will not be counted toward repayment/qualifying income.
o Credit of the non-purchasing spouse is not considered a reason to deny a loan application.
o The non-purchasing spouse will not sign the note, but will sign the security instrument.
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o Community/marital property states (Arizona, California, Idaho, Louisiana, Nevada, New Mexico,
Texas, Washington, and Wisconsin):
Except for obligations specifically excluded by state law, the debts of NPS’s must be
included in the applicant’s qualifying ratios.
A credit report that complies with Flagstar and RD requirements must be obtained for the
NPS in order to accurately determine the debts that must be counted in the total debt ratio.
Note: GUS will only retrieve credit reports for applicants. Therefore, lenders must obtain
an acceptable credit report outside of GUS for applications in community property states.
On the Assets and Liabilities application page lenders must enter the debt obligations
(those not excluded by state law) of the NPS in the appropriate liability section. In the
“Notes” data field lenders should identify the debt as spousal debt or NPS debt. The
credit report for the NPS must be retained in the lender’s permanent case file and
submitted to RD.
Any non-purchasing spouse debts in judgment status must be paid prior to closing.
Idaho: must indicate that applicant is applying as sole and separate.
INELIGIBLE BORROWERS
• Non-occupant co-borrowers
• Borrowers closing in a trust
ELIGIBLE PROPERTY TYPES
• One-unit detached or attached properties
• Condominiums. Refer to the Property Guidelines section for details
• Planned unit development (PUDs)
• Modular homes
INELIGIBLE PROPERTY TYPES
• Manufactured Homes. RD will accept new manufactured homes, Flagstar will not.
INCOME LIMITS
• Income used for purposes of determining eligibility for the GRH program is referred to as adjusted
annual income, and it is an estimate of the annual income to be received by all adult members of the
household over the next 12 months; adjusted annual income is not the same as repayment income,
which includes only income from the loan applicants and which must be determined by the underwriter
to be stable and dependable
• Annual income, adjusted annual income and repayment income will all be determined by using the
Worksheet for Documenting Eligible Household and Repayment Income, which is Attachment 9-B to
Chapter 9, Income Analysis, of RD Technical Handbook, HB-1-3555
• Adjusted annual income may not exceed 115% of the median income for the area in which the subject
property is located; the income limits published here are calculated at 115% of the median income and
cannot be exceeded
• Tax exempt income is included for purposes of determining whether adjusted annual income conforms
to the income limits, but it is not grossed up.
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HOMEBUYER EDUCATION
Homebuyer education is not typically a requirement for a GRH loan. However, it may be required by RD in
some circumstances. Even if not required by RD, homebuyer education is always highly recommended by
Flagstar as a tool to help homebuyers better understand the home buying process, developing and maintaining
a home budget and typical home maintenance issues all with the goal of helping the homebuyer maintain
successful homeownership. Refer to HUD’s Housing Counselor Directory for more information.
MAXIMUM LOAN AMOUNT
PURCHASE
The maximum base loan amount is determined by qualifying ratios and appraised value or the loan limit,
whichever is less. The gross loan amount may exceed the appraised value only by the amount of the
financed Guarantee Fee.
REFINANCE
Non-streamlined refinances: The new loan amount may include the principal and interest of the existing RD
loan, closing costs, prepaid expenses, and lender fees to the extent there is sufficient equity in the
property, as determined by the new appraisal. The guarantee fee may still be financed even if the resulting
gross loan amount would exceed the appraised value.
Streamlined refinances: The refinance loan amount may represent the outstanding principal balance
(including current interest charges due along with a reasonable and customary fee for reconveyance) of the
existing GRH loan and any amount of the upfront guarantee fee to be financed into the loan. The new loan
amount cannot exceed the original purchase loan amount and cannot include delinquent interest, closing
costs, prepaid expenses, or lender fees. The guarantee fee can be included in the loan amount, but only to
the extent that the gross loan amount does not exceed the original purchase loan amount of the existing
loan to be refinanced. (Streamlined-Assist transactions are not eligible under this product. Use the GRH
Streamlined-Assist product instead.)
TEMPORARY BUY-DOWNS
Not eligible. RD will permit temporary buy-downs, Flagstar will not.
RESERVES
Not required.
SUBORDINATE FINANCING
PURCHASE
No maximum CLTV. However, subordinate financing (down-payment assistance) is allowed only from a
non-profit or religious organization, a federal, state, or local government agency. All secondary financing
must be reviewed and approved by Flagstar Bank.
REFINANCE
No maximum CLTV. Any subordinate financing cannot be included into the new first lien, and must remain
subordinate.
INTERESTED PARTY CONTRIBUTIONS
Limited to 6% of the sales price
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CREDIT ALERT INTERACTIVE VOICE RESPONSE SYSTEM (CAIVRS)
All borrowers must be screened using HUD’s Credit Alert Interactive Voice Response System (CAIVRS). Rural
Development will not insure a loan if the borrower is currently delinquent on any unpaid federal debt or has had
a claim paid within the previous three years. A CAIVRS check occurs automatically when the loan is submitted
to RD’s GUS system. A CAIVRS number that begins with anything other than an “A” must be investigated and
verification must be obtained that the debt has been satisfied prior to moving forward with the loan application.
The GUS findings will identify all such loans.
SYSTEM FOR AWARD MANAGEMENT (SAM)
All applicants and other parties to the transaction (including sellers, listing and selling real estate agents, loan
officers, loan processors, underwriters, appraisers and builders) must be screened using General Services
Administration (GSA) System for Award Management (SAM) (https://www.sam.gov/portal/public/SAM/). An
applicant is ineligible if he/she is presently delinquent on any Federal debt or is suspended or debarred, or
otherwise excluded from participating in Rural Development programs. Customers will check the website
above and submit screen prints of the results of those checks for all parties along with their underwriting
submission to Flagstar. The checks should occur no greater than 30 days prior to loan closing, otherwise
documentation will need to be updated by performing another check of SAM and submitting the new screen
print to Flagstar.
PROPERTY GUIDELINES
APPRAISAL STANDARDS
• Appraisals ordered through Loantrac must include the following comment in the Special Instructions
field: Appraisal is for a Rural Development loan.
• Appraiser must not appear on the ineligible appraisers list published by the state RD office.
• Refer to Chapter 12, Property and Appraisal Requirements of RD Technical Handbook, HB-1-3555.
• Full URAR appraisal
o Fannie Mae Form 1004/Freddie Mac Form 70, (for one-unit single-family dwellings).
o Fannie Mae Form 1073/Freddie Mac Form 465 (for condominium units).
o Every appraisal must be accompanied by a Fannie Mae Form 1004MC/Freddie Mac Form
71 (Market Conditions Addendum to the Appraisal Report).
o Residential appraisals will be completed using the sales comparison approach. The income
approach is only necessary if the appraiser determines that it is necessary to develop
credible assignment results. The cost approach is not required.
Not less than three comparable sales will be used unless the appraiser provides
documentation that such comparable sales are not available. The appraiser must
use their knowledge of the area and apply good judgment in the selection of
comparable sales that are the best indicators of value for the subject property.
o Photographs used in the appraisal report must be clear and descriptive to be able to identify
the property’s condition and quality. Photographs must clearly represent the improvements,
and any physical deterioration of the property, amenities, conditions and external influences
that may have a material effect on the market value or marketability of the subject property.
An appraisal report with interior and exterior inspection of the subject property must include
at least the following:
A front view of the subject property
A rear view of the subject property
A street scene identifying location of the subject property and neighboring improvements
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The kitchen, main living area, bathrooms and bedrooms
Any other rooms representing overall condition, recent updates, such as restoration,
remodeling and renovation
Basement, attic and crawl space
Comparable sales, listings, and/or pending sales utilized in the valuation analysis
must include at least a front view of each comparable utilized
Condominium projects should include additional photographs of the common areas
and shared amenities
o An appraisal ordered by another lender for the applicant can be transferred to the lender
who will complete the purchase transaction. The initial lender must agree to the transfer of
the report. A letter from the initial lender who ordered the appraisal report must be retained
in the permanent loan file as evidence the lender transferred the report to the lender
completing the purchase transaction. The receiving lender must assume full responsibility
for the integrity, accuracy and thoroughness of the appraisal report including the methods
that the original lender used to acquire the appraisal. The appraisal report must be no older
than 120 days at loan closing to be valid.
o Lenders may extend the validity period of an appraisal with an appraisal update report that
will be no greater than 240 days from the effective date of the initial appraisal report at loan
closing (120 days for the original appraisal plus 120 days for the Appraisal Update Report).
Appraisals with no update will be no greater than 150 days from the effective date of the
appraisal report at loan closing (120 days validity period plus a 30-day extension period).
The 30-day extension period cannot be used when the original appraisal report is updated.
An original appraisal report can be updated one time with an Appraisal Update Report.
All Appraisal Update Reports must include a completed Market Conditions
Addendum (Fannie Mae Form 1004MC/Freddie Mac Form 71) for the subject
property that is reflective of market conditions as of the effective date of the
Appraisal Update Report.
The appraiser may use a pre-printed form or a narrative report to provide the
appraisal update, but whichever reporting format is used it must be in compliance
with USPAP.
Fannie Mae Form 1004D/Freddie Mac Form 442, Appraisal Update and/or
Completion Report may be utilized by the lender to report the completion of a repair
and/or satisfaction of requirements and conditions noted in the original appraisal
report.
o Appraiser MUST certify that the requirements of HUD Handbook 4000.1 have been met.
The certification may be made on page three of the appraisal form, in the Additional
Comments section, or the appraiser may make their certification in an addendum to the
appraisal. Certifications made elsewhere on the appraisal form may not be acceptable to
RD. It is not necessary for the appraiser to specifically identify the HUD Handbook by
number. However, appraiser comments that the state of the property appears to meet or
seems to meet HUD Handbooks are unacceptable.
o Insulation section must not be stated as unknown, assumed, concealed or similar wording.
• Existing dwelling inspection reports/certifications are not required with appraisals by FHA roster
appraisers; however, they are required if the appraisal is prepared by a non-FHA roster appraiser.
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PROPERTY STANDARDS
• Property must be in area designated as rural by Rural Development, refer to the USDA Income and
Property Eligibility site.
• Condominiums must meet Fannie Mae or Freddie Mac warranty guidelines or be HUD or VA approved.
• There is no site size limitation, but the size must be typical for the area. The site must not have
income-producing land (e.g., tracts of arable land ready for planting). However, a minimal incomeproducing activity, such as a garden that could generate a small amount of additional income does
not violate this requirement. A qualified property must be predominantly residential in use, character
and appearance.
• Properties constructed within the past 12 months and that have never been occupied are
considered new construction and must comply with RD’s guidelines for new construction properties.
Contact the appropriate RD production team for their current new construction guidelines. Flagstar
will only finance the permanent end loan. These transactions will be treated as purchases. Oneclosing construction transactions are not eligible.
• Property repairs may be required by the appraiser or Flagstar. Properties requiring repairs generally
must have the work completed prior to closing. However, an escrow holdback may be allowed on a
case by cases basis only for exterior property repairs that cannot be completed due to inclement
weather; refer to the Escrow Holdback section of Flagstar’s USDA Underwriting Guidelines for
further information.
FLOOD HAZARD REQUIREMENTS
• The lender must complete, or arrange for a contractor to complete, FEMA Form 086-0-32,
Standard Flood Hazard Determination Form (SFHDF) to determine whether the dwelling is
located in a Special Flood Hazard Area (SFHA) in accordance with the National Flood
Insurance Reform Act of 1994.
• Existing dwellings are eligible under the SFHGLP only if flood insurance through FEMA’s
National Flood Insurance Program (NFIP) is available for the community and flood insurance
whether NFIP, write your own, or private flood insurance, as approved by the lender, is
purchased by the borrower. Lenders are required to accept private flood insurance policies that
meet the requirements of 42 USC 4012a(b)(1)(A). Insurance must be obtained as a condition of
closing and maintained for the life of the loan for an existing residential structures property when
any portion of the residential improvements structure is determined to be located in a SFHA,
including decks and carports, etc. However, according to the Homeowner Flood Insurance
Affordability Act (HFIAA) of 2014, flood insurance is not required for any additional structures
that are located on the property but are detached from the primary residential structure and do
not serve as a residence, such as sheds, garages, or other ancillary structures.
• New or proposed construction in an SFHA is ineligible for a loan guarantee unless:
o A final Letter of Map Amendment (LOMA) or final Letter of Map Revision (LOMR)
removes the property for the SFHA is obtained from FEMA, or;
o The lender obtains a FEMA National Flood Insurance Program Elevation Certificate
(FEMA Form 086-0-33). The flood elevation certificate must document that the lowest
floor (including the basement) of the residential building, and all related improvements/
equipment essential to the value of the property, are built at or above the 100-year flood
elevation in compliance with National Flood Insurance Program (NFIP) criteria. The flood
elevation certificate must be prepared by a licensed engineer or surveyor.
Part of the site may be located in the SFHA without triggering these requirements, as long as no
part of the dwelling is located in the SFHA. At the lender’s discretion they may require national flood
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insurance even if the residential building and related improvements to the property are not located
within the SFHA, but the lender has reason to believe that the building and related improvements to
the property may be vulnerable to damage from flooding.
Flood insurance must cover the lesser of the outstanding principal balance of the loan or the
maximum amount of coverage allowed under FEMA’s National Flood Insurance Program (NFIP).
Unless a higher maximum amount is required by state or federal law, the maximum deductible
clause for a flood insurance policy should not exceed the greater of $1,000 or 1 percent of the face
amount of the policy.
EXISTING DWELLING REQUIREMENTS
• Wells
o The local health authority or state certified laboratory must perform a water quality
analysis. Water quality must meet state and local standards. Contact EPA’s Safe Drinking
Water Hotline: (800) 426-4791 or refer to the Drinking Water Contaminants website.
o Before ordering a water quality analysis, check the state RD website for any specific
requirements or contact the appropriate RD production team. Water test results
submitted without all of the required contaminant analyses will not be accepted and must
be reordered. Also, once the state requirements for water tests have been determined
contact the desired laboratory to ensure they can complete all required tests. Not every
laboratory has the capacity to run all required tests.
Minnesota: Water quality analysis must include tests for coliform bacteria (total),
nitrate nitrogen, and lead for all properties. In addition, properties with new wells
must include a test for arsenic. See USDA RD MN Private Well Testing
Requirements.
o Wells with unsafe levels of nitrates will require installation of an approved individual
water treatment system, must verify that an acceptable water treatment system has
been installed.
o Properties with shared wells: Flagstar Underwriting management must approve loans
secured by properties with shared wells where the water source is located on another
property. A recorded shared well agreement and title commitment must be submitted for
review. The agreement must provide irrevocable water rights to the subject property.
• Septic systems
o Septic inspections are not required unless:
The appraiser notes observable evidence of system failure
The appraiser or underwriter is in doubt about the operation of the system (e.g.,
when the property is vacant). If either is true the local health authority or a septic
system professional must determine the viability of the system.
• Pest inspections
o If required by the appraiser, Flagstar, or local/state law, a pest inspection must be
obtained showing that the property is free of active termite infestation.
OUTBUILDINGS
• Customers should review the requirements in Paragraph 12.4, Site Requirements of Chapter
12, Property and Appraisal Requirements of RD Technical Handbook, HB-1-3555 and should
discuss such properties with one of our GRH underwriters to determine if the property is eligible.
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BASEMENT KITCHENS
• Properties with basement kitchens are only acceptable if it can be clearly demonstrated that the
basement could not be rented as a separate living unit, even if there are no plans to do so.
Examples of basement features that, when looked at together with the kitchen, might
demonstrate the ability to be rented as a separate living unit include, but are not limited to: a
separate entrance into the basement without accessing another part of the home, a full bath, a
bedroom or area that could serve as a bedroom, closet space, etc.
• Customers should discuss such properties with one of our GRH underwriters to determine if the
property is eligible.
UNDERWRITING
• All loans will be underwritten to current Flagstar Bank and Rural Development guidelines.
• Rural Development’s basic eligibility and underwriting guidelines are found in 7 CFR 3555 and the RD
Technical Handbook, HB-1-3555.
• Use the Rural Housing Processing Checklist, Doc. #9801, for documentation required for submission to
Flagstar Underwriting.
• Flagstar requires a minimum credit score of 620.
o Even with credit scores of 620 or greater, there must not be indicators of unacceptable credit:
Foreclosure within three years:
• Including pre-foreclosure activity, such as a pre-foreclosure sale or short sale in
the previous three years;
Bankruptcy within three years:
• Chapter 7 bankruptcy discharged in the previous three years;
• Chapter 13 bankruptcy that has yet to complete repayment or has completed
repayment in the most recent 12 months;
Late mortgage payments, if any mortgage trade line during the most recent 12 months
shows one or more late payments of greater than 30 days;
Late rent payments paid 30 or more days late within the last 12 months.
• Flagstar will only use Credco credit reports when underwriting GRH loan transactions. For Flagstar
underwritten files, if the customer does not provide a Credco credit report, the underwriter will order
one, and the credit report of record, which will include the credit scores of record, will be the Credco
report used in the most recent Guaranteed Underwriting System (GUS) submission.
o Delegated customers and customers who are Lender Agents of Flagstar, and thus able to
submit loans to the USDA GUS system themselves, may use their own credit providers.
• At least one applicant whose income or assets are used for qualification must have a valid credit score,
consisting of two or more trade lines with at least 12 months of repayment history reported on the credit
report. The trade line may be open, closed and/or paid in full by the applicant. Refer to Paragraph 10.5
of Chapter 10, Credit Analysis of the RD Technical Handbook for a list of eligible trade lines.
• Flagstar will submit all eligible loans to the Guaranteed Underwriting System (GUS), an automated
underwriting tool provided by Rural Development based on a modified version of the FHA Total
Scorecard. The GUS Underwriting Findings Report will be posted to Loantrac’s Documents module.
Currently, there is no interface between the GUS system and Flagstar’s system. The underwriter must
ensure data integrity by confirming no discrepancies exist between the data entered in both systems
and that the documentation in the file supports such information.
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• All loan applications must be fully documented. Documentation submitted to the underwriter must verify
the borrower’s credit history, employment, income, assets, collateral requirements, and any other
documentation supporting the loan request (such as verification of mitigating circumstances regarding
adverse credit). An Accept/Eligible recommendation from GUS often provides the approving lender the
ability to provide limited documentation to the appropriate RD production team, but lenders must still
possess and maintain a fully documented permanent loan file in their records.
• Loans that receive an Accept/Eligible recommendation, and which have a valid credit score, do not
require explanation or further review of mitigating circumstances for adverse credit. All other loan data
must be fully documented and verified.
• For loans that do not receive an Accept/Eligible recommendation from GUS, the underwriter must
document compensating factors considered in the evaluation of the mortgage loan application on the
Uniform Underwriting and Transmittal Summary, Fannie Mae Form 1008. Then print the 1008, sign it,
and upload the signed version into Paperless File Manager. The signed 1008 must be included with the
full file submission to the appropriate RD production team.
• The broker/correspondent is to fill out the Request for Single Family Housing Loan Guarantee, Form
RD 3555-21. The borrower and co-borrower must sign page two. In addition, the broker/correspondent
is to fill out the Worksheet for Documenting Eligible Household and Repayment Income, which is
Attachment 9-B to Chapter 9, Income Analysis, of RD Technical Handbook, HB-1-3555. For nondelegated customers, the forms must be submitted to the underwriter with the initial loan submission.
The 3555-21 must be completely filled out and signed by the underwriter and applicants PRIOR to
submitting the loan to the appropriate RD production team.
• Once the underwriter issues a conditional loan approval where the only outstanding prior-to-close
conditions are not likely to affect the GUS recommendation, the underwriter will Final Submit the loan in
the GUS system, and send the appropriate documents to the appropriate RD production team for their
review. Non-delegated brokers/correspondents should not submit anything to RD.
• The underwriter is responsible for resubmitting the loan to GUS when material changes in loan data
occur. Under the following conditions, the underwriter must resubmit the loan through GUS for an
updated evaluation. If the Final Submit has already occurred, the underwriter will need to contact the
appropriate RD production team to have the loan application released back to Flagstar in GUS.
o Borrowers were added/deleted from the application or critical borrower information has changed.
o A decrease in the borrower’s income and/or cash reserves.
o An increase in the loan amount or interest rate.
o Any changes that would negatively affect the borrower’s ability to repay the mortgage.
o Any changes regarding the property, such as change in sales price or appraised value.
• Some data changes do not affect the outcome of an underwriting recommendation. Once a mortgage
loan has been sent to the appropriate RD production team as a Final Submit, the following data
changes do not require that the GUS loan application be updated. Although these changes do not
require another GUS submission, an updated Form RD 3555-21 MUST be submitted to the appropriate
RD production team and the RD Conditional Commitment re-issued with the updated information.
o A decrease in the interest rate.
o A decrease in the loan amount.
o A decrease of mortgage or personal liabilities.
o An increase of assets.
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• Documentation to include in submission to the appropriate RD production team.
o Accept/Eligible loans:
Underwriter should refer to RD’s Origination Stacking Order Checklist for list of required
documents and stacking order.
o In the following circumstances, even Accept/Eligible loans will require that a fully documented
file be submitted to the appropriate RD production team (appropriate messaging will appear on
the GUS findings):
When a loan is submitted to GUS 10 or more times.
As part of a random five percent sample of loans.
If the borrower or co-borrower is on another GUS application within the past 12 months.
Loans that receive the full file submission message on the GUS findings are treated by
Flagstar as a recommendation downgrade to Refer and are ineligible.
• Loans that receive an Accept/Ineligible recommendation must be reviewed to determine if the
ineligibility identified in the GUS findings can be resolved. If so, the loan information must be corrected
and resubmitted to GUS to obtain a revised underwriting recommendation (Accept/Eligible).
Accept/Ineligible loans are not approvable if the reason(s) leading to the ineligibility cannot be resolved.
INCOME/EMPLOYMENT DOCUMENTATION
• Non-self-employed applicants must meet one of the following:
o Request for Verification of Employment, Form RD 1910-5 or the equivalent FHA/VA/Fannie
Mae form, and the most recent paycheck stub, or
o Paycheck stubs or payroll earnings statements covering the most recent 30-day period, and
W-2 tax forms for the previous two tax years, and a verbal verification of employment (VOE)
as required, or
o Electronic verification or other computer-generated documents accessed and printed from
an Intranet or Internet, and W-2 tax forms for the previous two tax years, and a verbal VOE,
as required.
o Refer to Section 2: Repayment Income of Chapter 9, Income Analysis of RD Technical
Handbook, HB-1-3555 for further guidance.
• Self-employed applicants must submit the following:
o Signed individual Federal income tax returns with all appropriate schedules for the most
recent two tax years.
o Signed business Federal tax returns for the most recent two tax years:
Sole proprietor: Schedule C to individual Form 1040
Partnership: Form 1065
S Corporation: Form 1120S
Corporation: Form 1120
o Current profit and loss statement for the business.
o Current balance sheet for the business.
o IRS Form 4506-C, signed.
o Refer to Section 2: Repayment Income of Chapter 9, Income Analysis of RD Technical
Handbook, HB-1-3555 for further guidance on underwriting self-employed applicants as well
as information on how to treat business debts.
• Part-time, Second Job and/or Seasonal Income:
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o Income from a second job or part-time job may be counted for repayment income if the
applicant has worked this position uninterrupted for the past two years and will continue to
do so. This type of income must be likely to continue for the next three years.
o Income from seasonal employment (e.g., umpiring baseball games in summer or working at
a department store during the Christmas shopping season) is considered uninterrupted and
may be counted if the applicant has worked the same type of job for the past two years.
o Income from a part-time position that has been received for less than two years may be
counted if the lender is able to determine through employer verification that the income’s
continuance is likely at the level of receipt verified in the past. Income from part-time
positions not meeting these requirements may be considered as a compensating factor, as
described in Chapter 11, Ratio Analysis of RD Technical Handbook, HB-1-3555.
o To utilize secondary employment or seasonal income for repayment, the income must be
reported on the applicant’s federal income tax returns for the most recent two years.
• Alimony and child support income must be documented to continue for a minimum of three years
and must document a history of receipt for at least 12 months and a signed IRS Form 4506-C.
• Social Security or disability income:
o Document that income will continue for a minimum of three years with award letter.
o IRS Form 4506-C, signed.
• When considering income not subject to Federal income tax, for example, certain types of disability
payments or military allowance, the amount of continued tax savings attributable to non-taxable
income source may be added to the applicant’s repayment income. Income that has been verified
to be tax exempt may be grossed up by 25 percent, in other words, multiplied by 125 percent to
“gross up” such income. No other adjustments for tax exempt income are authorized. Tax exempt
income sources should not be grossed up when calculating eligibility income.
• Rental income:
o Net monthly rental income must always be included in household income for income
eligibility purposes, regardless of whether it is also considered to be stable income and
therefore eligible to be included in qualifying income. To calculate the amount to be included
in household income, the monthly gross rents amount must be reduced by a vacancy factor
of 25% before subtracting the monthly principal, interest, taxes, insurance, and homeowners
association dues, etc. Treat the income as follows:
Positive net rental income is included in household income
Negative net rental income is treated as $0.
o In order for rental income to be included in the borrower’s qualifying income, borrowers must
be able to document receipt of rental income over the past 24 months using IRS Form 1040,
Schedule E, for the past two income tax filings, along with a signed IRS Form 4506-C. The
income may be averaged over the past 24-month period, and depreciation may be added
back to the net income or loss shown on Schedule E. Positive net rental income may be
considered as qualifying income. Negative net rental income must be treated as a recurring
monthly liability.
o For newly signed leases, Flagstar requires applicants to qualify with all mortgage liabilities;
no rental income is to be included in qualifying income.
DEBTS/OBLIGATIONS
• Standard GRH qualifying ratios are 29% / 41%.
o Higher ratios are permitted with an Accept/Eligible recommendation from GUS; underwriter
will follow GUS findings.
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• The total debt ratio will include long-term obligations with more than 10 months remaining, including
all installment loans, revolving charge accounts, alimony, child support or separate maintenance
payments and other continuing obligations.
• Short-term obligations that are considered to have a significant impact on repayment ability, such
as large medical bills, automobile lease contracts with 10 or fewer remaining payments or other
credit payments will be counted in the total debt ratio.
• Collections:
o Refer to Paragraph 10.9 of Chapter 10, Credit Analysis of RD Technical Handbook, HB-1-
3555.
• Judgments:
o Refer to Paragraph 10.10 of Chapter 10, Credit Analysis of RD Technical Handbook, HB-1-
3555.
ASSETS
• The 1003 must fully disclose assets for ALL applicants.
• Income from all HOUSEHOLD assets (not just applicant assets) must be disclosed for all adult
members of the household, and must be included on the Eligibility page in GUS.
o Refer to Paragraph 9.4 of Chapter 9, Income Analysis of RD Technical Handbook, HB-1-
3555 for additional information regarding assets and program eligible income. Assets
meeting the requirements of that paragraph also require verification documentation for the
file. Such assets must be included in the GUS submission.
• Assets are not required to be entered on the Assets and Liabilities page in GUS; however, any
assets entered must be fully documented. The presence of assets/cash reserves after closing can
influence the outcome of the GUS underwriting recommendation.
• The underwriter may choose to submit the loan to GUS without disclosing the assets. If an
unfavorable recommendation is received, resubmission of the loan application with the asset
information may result in an improved recommendation. If this is the case, the underwriter will
require verification of assets be submitted to Flagstar.
o If assets are submitted to GUS, the lesser of the two-month average balance or the actual
balance (as reported on the most recent statement) will be input on the Assets and
Liabilities page of GUS. Refer to Paragraph 9.3 of Chapter 9, Income Analysis of RD
Technical Handbook, HB-1-3555 for documentation standards and examples of calculating
the average monthly balance of assets.
• Depository accounts (e.g., checking, savings, certificate of deposit, money market):
o Verification of Deposit with the two-month average balance, or two consecutive monthly
bank statements dated within 45 days of the initial loan application date.
o A two-month average of liquid assets most accurately represents the true value of the
account(s) since these types of accounts often fluctuate significantly during the month. The
lesser of the two-month average balance or the actual balance (as reported on the most
recent statement) will be input on the Assets and Liabilities page of GUS. Refer to
Paragraph 9.3 of Chapter 9, Income Analysis of RD Technical Handbook, HB-1-3555 for
documentation standards and examples of calculating the average monthly balance of
assets.
• Earnest money deposit:
o Earnest money deposit on sales contracts can be considered an asset if the deposit is not
already reflected in a liquid asset account (such as a checking or savings account).
Guaranteed Rural Housing
V. Product Guidelines 14 of 19 Document #5830
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o If the funds have cleared the borrower’s account, place the amount as an Other Credit in
Section VII of the application, where it is assumed to have been verified.
o For GUS transactions, do not enter earnest money in a depository account on the Assets
and Liabilities page and in the Other Credit section on the Transaction Details page.
• Gift funds:
o Funds may be provided by the applicant’s relative, employer or labor union, charitable
organization, or government agency/public entity that has a program to provide
homeownership assistance to low and moderate income applicants.
o Refer to Section 9.3(E)(1) of Chapter 9, Income Analysis of RD Technical Handbook, HB-1-
3555 for information on verification of gifts.
• Sale proceeds from currently owned property:
o Final HUD-1 Settlement Statement or Closing Disclosures indicating cash sales proceeds
actually realized by borrower.
o Proceeds from the sale of the property should be included in the borrower’s liquid assets
(such as a checking or savings account).
o For GUS transactions, the Net Equity portion will be populated once the Real Estate Owned
Property section is properly completed.
• Retirement accounts (e.g., IRAs, thrift savings plans, 401(k)s, and Keogh accounts):
o To account for withdrawal penalties and taxes, 60% of the vested amount will be used as
the value of retirement assets. Accounts that restrict withdrawals only in connection with the
borrower’s employment separation, retirement, or death will not be considered as assets.
o Obtain the most recent statement.
o Funds borrowed against these accounts may be used for loan closing, but are not to be
considered as cash reserves
• Stocks and bonds:
o Obtain the most recent monthly or quarterly statement provided by the stockbroker or
financial institution managing the portfolio.
• Cash-on-hand:
o The borrower should be able to explain in writing how funds were accumulated and the
amount of time taken to do so.
o The underwriter must determine the reasonableness based on the borrower’s income
stream and the time frame in which the funds were saved.
o Typically, individuals that accumulate and keep cash savings on hand are less likely to save
money through a savings or checking account as would an individual with a history of such
accounts.
OTHER REQUIREMENTS
• Borrowers owning multiple dwellings: Applicants are limited to retaining ownership in one dwelling
other than the one associated with the loan request. The retained dwelling must be outside of the
local commuting area or not be structurally sound and functionally adequate.
• An escrow account is required. Therefore, escrow waivers are not permitted.
• The Rural Development Conditional Commitment for Single Family Housing Loan Guarantee, Form
RD 3555-18 must be received by the underwriter prior to issuing a Final Approval.
Guaranteed Rural Housing
V. Product Guidelines 15 of 19 Document #5830
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• Final loan approval must include a statement about the maximum interest rate (e.g., The maximum
interest rate is ___%.), which is to be drawn from the GUS findings and/or the RD Conditional
Commitment.
• Final loan approval must include a statement about the maximum payment (e.g., “Total new house
payment including taxes and insurance cannot exceed $_______.”). This amount must be in line
with the GUS findings, and is to exclude any homeowners association (HOA) fee.
• New construction: Loans that represent the permanent financing of a two-closing construction
transaction are eligible as are loans that represent the purchase of a newly constructed dwelling
from a builder. One-closing construction transactions are not eligible.
• California purchases: For purchases of new and existing properties in California only, property
taxes may be calculated using 1.25% of the purchase price or the actual tax rate.
REFINANCE TRANSACTIONS
• Click here for a helpful side-by-side refinance options chart provided by USDA.
• All refinance transactions:
o Refer to Chapter 6, Loan Purposes of RD Technical Handbook, HB-1-3555.
o Existing RD loans may be refinanced even if property is no longer in a designated rural
area.
o The interest rate of the new loan must be at or below the interest rate of the existing loan.
o The existing RD loan must have closed at least 12 months prior to the appropriate RD
production team’s receipt of a conditional commitment request for refinance (loans
outstanding for less than 12 months are not eligible for refinance).
o The existing loan to be refinanced must have been current for the previous 180-day period
prior to the appropriate RD production team’s receipt of a conditional commitment request
for refinance.
o Any late mortgage payments within the past 36 months on the existing USDA loan must be
analyzed and addressed by the lender to determine if any late payments were a disregard
for financial obligations, an inability to manage debt, or factors beyond the control of the
borrower when considering the underwriting decision. The permanent file for the new loan
must contain documented evidence that the payment history requirements have been met.
o Adding or deleting borrowers is permissible as long as at least one original borrower is
retained on the new refinance loan.
o Escrow credits are not permitted. The borrower’s existing escrow balance may not be
credited to the payoff and/or credited anywhere on the Closing Disclosure.
o Customary and reasonable closing costs and other fees may be collected from the borrower
by the lender. Such charges may not exceed the cost paid by the lender or charged to the
lender by the service provider. Excessive fees are not permitted. Examples of customary
and reasonable fees are:
The actual cost of the appraisal, inspection, credit reports, imposed verification
charges, title examination and title insurance fees, attorney fees, settlement fees,
recording fees, taxes, test or treatment fees, and/or courier/wire/notary fees as long
as the service provider is not an employee of the lender.
Document preparation fees may only be charged if the documents are prepared by a
third party not controlled by the lender. The lender may not charge document
preparation fees if it prepared the documents itself.
Guaranteed Rural Housing
V. Product Guidelines 16 of 19 Document #5830
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Only bona-fide discount points (paid to Flagstar to lower the interest rate) can be
assessed to the borrower. See Discount Points under Other Fees in the Fees section
below.
o Subordinate financing, such as home equity seconds and down payment assistance silent
seconds, cannot be included in the new loan amount. Any existing secondary financing must
be re-subordinated to the new first lien.
o Refer to Paragraph 11.3B of Chapter 11, Ratio Analysis, of RD Technical Handbook, HB-1-
3555 regarding debt ratio waivers and compensating factors for refinance transactions.
o All guidelines not specified in this section that are applicable to purchase transactions apply.
• Non-streamlined refinances:
o Existing loan must a USDA GRH or Direct loan without regard to the current servicer.
o A new appraisal is required.
o The new loan amount may include the principal and interest of the existing RD loan, closing
costs, prepaid expenses, and lender fees to the extent there is sufficient equity in the property,
as determined by the new appraisal.
o The guarantee fee may still be financed even if the resulting gross loan amount would exceed
the appraised value.
• Streamlined refinances:
o Existing loan must a USDA GRH loan serviced by Flagstar Bank. Streamlined refinances of
USDA GRH loans serviced by others must be done under the GRH Streamline-Assist program.
o An appraisal is not required, and the value used for the appraised value will be the appraised
value from the loan being refinanced.
o Streamlined refinance transactions may nowbe submitted to GUS.
o The refinance loan amount may represent the outstanding principal balance (including current
interest charges due along with a reasonable and customary fee for reconveyance) of the
existing GRH loan and any amount of the upfront guarantee fee to be financed into the loan.
The new loan amount cannot exceed the original purchase loan amount and cannot include
delinquent interest, closing costs, prepaid expenses, or lender fees.
o The guarantee fee can be included in the loan amount, but only to the extent that the gross loan
amount does not exceed the original purchase loan amount of the existing loan to be refinanced.
Even though an appraisal is not required, Flagstar requires a property inspection to
verify that the property meets the current requirements of HUD Handbook 4000.1. The
inspection must be conducted by an FHA appraiser on Flagstar’s eligible appraiser list.
• Loans utilizing the new Streamlined-Assist option must be registered under the special GRH
Streamlined-Assist products, based on whether the existing loan is currently serviced by Flagstar Bank
or another lender. Streamlined-Assist loans are not eligible under this product.
FEES
GUARANTEE FEE
The guarantee fee for all purchase and refinance transactions is 1.00% of the gross (final) loan amount.
The guarantee fee may be financed or paid at closing. If the upfront fee is financed, it is calculated as the
base loan amount (before the guarantee fee is added, but after other financed items) divided by 0.99,
rounded down to the nearest dollar, and then multiplied by 0.01. The gross loan amount may only exceed
the appraised value by the amount of the financed guarantee fee.
Guaranteed Rural Housing
V. Product Guidelines 17 of 19 Document #5830
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ANNUAL FEE (PAYABLE MONTHLY)
0.35%
Calculate the amount for the upfront and annual guarantee fees using the Guarantee Upfront and Annual
Fee Calculator.
Loantrac permits the following three options regarding the upfront guarantee fee:
• Full financing of the upfront guarantee fee (except for any amount less than one dollar),
• Partial financing of the fee (with the remainder paid in cash at closing), or
• Paying the full upfront guarantee fee in cash at closing.
Customers should refer to Loantrac’s Guaranteed Rural screen for the breakdown of the financed vs. paid
in cash portions of the guarantee fee.
OTHER FEES
• Fees and charges associated with originating/closing a GRH loan cannot exceed fees charged for
loans insured or guaranteed by the FHA or VA; refer to Paragraph 6.2C of Chapter 6, Loan Purposes
of RD Technical Handbook, HB-1-3555
• Closing costs for both purchase and non-streamlined refinance transactions may be financed up to
the appraised value of the property
• Discount points: Bona fide loan discount points (that reduce the interest rate) are eligible to be financed
for all loans; Financed discount points must not exceed two percentage points of the loan amount
STATE ELIGIBILITY
Available in designated rural areas of the following states and the U.S. Virgin Islands with the stated
restrictions. Designated rural areas in states not listed are available without restriction.
State Restriction
Arizona Community property state. See the Eligible Borrowers section for non-purchasing spouse details.
California Community property state. See the Eligible Borrowers section for non-purchasing spouse details.
District of Columbia Not eligible
Idaho Community property state. See the Eligible Borrowers section for non-purchasing spouse details.
Louisiana Community property state. See the Eligible Borrowers section for non-purchasing spouse details.
Nevada Community property state. See the Eligible Borrowers section for non-purchasing spouse details.
New Mexico Community property state. See the Eligible Borrowers section for non-purchasing spouse details.
Puerto Rico Not eligible
Texas Community property state. See the Eligible Borrowers section for non-purchasing spouse details.
Washington Community property state. See the Eligible Borrowers section for non-purchasing spouse details.
Wisconsin Community property state. See the Eligible Borrowers section for non-purchasing spouse details.
LATE FEE
Flagstar requires a five percent (5%) late fee for GRH transactions.
CLOSING DOCUMENTATION – CORRESPONDENT TRANSACTIONS
Closing documentation may be obtained from Flagstar’s Web-Based Closing Documents (WBCD) service
available on Loantrac.
Guaranteed Rural Housing
V. Product Guidelines 18 of 19 Document #5830
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• Fannie Mae/Freddie Mac Uniform Security Instrument, 3000-series.
• Fannie Mae/Freddie Mac multi-state Fixed Rate Note, 3200-series.
• Copy of Preliminary Title Policy or Preliminary Opinion (with environmental endorsement).
• Copy of Settlement Statement for prior primary residence (for purchase transactions).
• Copy of Homeowners Policy or Binder.
• Borrower must acknowledge receipt of the appraisal (signed handwritten statement is OK).
Cash back to the borrower at closing, including tax prorations, is not allowed except for refunding the
borrower’s verified earnest money deposit on a purchase transaction. Refinance transactions are not eligible
for any cash back to the borrower. Any excess should be returned to Flagstar.
Guaranteed Rural Housing – Exhibit A
V. Product Guidelines 19 of 19 Document #5830
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EXHIBIT A
How to originate a non-delegated Guaranteed Rural Housing loan with Flagstar:
1. Take the application, ensure applicant is eligible for a guaranteed loan based on:
a. Property being located in a rural area
b. Income eligibility (use RD’s Worksheet for Documenting Eligible Household and Repayment
Income, which is Attachment 9-B to Chapter 9, Income Analysis, of RD Technical Handbook, HB1-3555)
c. Initial review of credit
d. Qualifying ratios
2. Confirm eligibility through USDA’s Income and Property Eligibility site.
3. All applicants and other parties to the transaction (including sellers, listing and selling real estate
agents, loan officers, loan processors, underwriters, appraisers and builders) must be screened using
General Services Administration (GSA) System for Award Management (SAM) (https://www.sam.gov/
portal/public/SAM/). Obtain screen prints for results of all checks and submit with underwriting file.
4. Upload/input loan application into Loantrac, select product using a Loan Type of Rural, complete
Guaranteed Rural screen on Loantrac, run credit through Loantrac, order verifications, etc.
5. Retrieve and follow the Rural Housing Processing Checklist, Doc. #9801.
6. Complete all applicable Rural Development forms, to include signatures, and then submit loan
application package to Flagstar for underwriting review.
7. Once Flagstar issues its conditional loan approval, the underwriter will submit file to Rural Development
for their review.
8. Rural Development reviews loan and issues Form RD 3555-18, Conditional Commitment of Single
Family Housing Loan Guarantee.
9. Flagstar reviews and clears conditions listed on the Form RD 3555-18 and places loan into Final
Approval status.
10.Broker/correspondent locks the interest rate with Flagstar Marketing department (if not previously
locked). Save confirmation in the file.
11.Schedule the closing. Prepare closing documents using Flagstar’s Web-Based Closing Docs (WBCD)
service available on Loantrac. Order funds.
12. Close the loan.
13. Deliver closed loan package to Flagstar.
14.Flagstar submits the guarantee package to Rural Development using RD’s Loan Closing Stacking
Order Checklist.
15. Rural Development issues the Loan Note Guarantee, Form RD 3555-17 to Flagstar
by usezloan | Aug 12, 2021 | Financial study
융자지식201- VA A UNDERWRITING GUIDELINES
A UNDERWRITING GUIDELINES
• VA Pamphlet 26-7 – Lenders Handbook
• VA Loan Guaranty Circulars
• VA Loan Limits
OVERLAYS
4506-C
• A fully executed IRS Form 4506-C must be included in all loan files.
• 1040 transcripts are required for the following income types:
o Self-employed
o Rental income documented on Schedule E
o Employed by family
o Fixed income types such as disability, social security, retirement, child support, alimony,
etc., when the 1040s are obtained in lieu of alternative documentation such as award letters,
1099s, bank statements, etc.
ASSETS
SWEAT EQUITY
Not allowed
CLOSING
CLOSING IN TRUST
• For loans closing in a trust, a Certificate of Trust, Doc. #3954 or similar form is required. For
properties located in California, the California Trust Certificate, Doc. #3951 or similar form may
be used.
VERIFICATION OF EMPLOYMENT
• Reverification of employment related income must be completed within 10 days prior to the date
of the note, excluding non-credit qualifying IRRRL refinances. Verbal re-verification of
employment is acceptable. Third party verifications such as Work Number are acceptable.
CREDIT SCORES
MINIMUM CREDIT SCORES
Loan
Purpose Purchase Cash-Out Refinance 1
Cash-Out Refinance 2 IRRRL
Units 1-2 Units 3-4 Units 1-2 Units 3-4 Units 1-2 Units 3-4 Units
Minimum
Credit
Score
620 620 620 620 620 620
1. VA Cash-out refinance in which borrower does not receive cash back and only paying off mortgage debt.
2. Borrower receives cash back and/or consolidates non-mortgage debt.
VA Underwriting Guidelines
VI. Underwriting Guidelines 4 of 13 06/17/2021
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DOWN PAYMENT
• All community second and grant programs must be Flagstar-eligible – Refer to Gift/Grant Programs,
Doc. #5935 or Community Seconds Programs, Doc. #5932.
• Due to GNMA’s prohibition, the down payment may not be derived from a second mortgage on the
property.
ENERGY EFFICIENT MORTGAGES
Ineligible
ESCROW HOLDBACKS
• Closing documents must be prepared through Flagstar’s Web-Based Closing Documents (WBCD)
and all repair escrows for Flagstar-underwritten loans are held by Flagstar
• Two bids required
o Holdback will be 1 ½ times the highest bid. Bids may not exceed $6,666 for a maximum
escrow holdback of $10,000
• One draw only permitted upon completion of repairs
FUNDING FEE
Due to system constraints, the funding fee must be fully financed or fully paid at closing
INSURANCE
HO-6 POLICY
• If Flagstar underwrites the loan, HO-6 insurance coverage for condominiums and PUDs having
any coverage maintained under a master policy must be at least 20% of the property’s
appraised value or replacement cost
JOINT LOANS
• Due to system constraints, the following joint loans are ineligible transactions:
o All veterans are using entitlement and one is exempt from paying the funding fee but all
others are required to pay a funding fee
o Two or more unmarried veterans are borrowers on a loan but only one is using entitlement
o Two or more veterans are using entitlement but one or more of the veterans’ funding fee
factors differs from the others (i.e. One veteran’s funding fee factor is 2.15% and the other
veteran’s funding fee factor is 3.30%)
o Borrowers are a veteran and non-veteran who is not the veteran’s spouse and the veteran is
subject to paying a funding fee
• All veterans must occupy the property
LTV/CLTV
CASH-OUT REFINANCE
• 3-4 unit: 90% – Borrower receives cash back and/or consolidates non-mortgage debt
• 3-4 unit: 100% – Borrower does not receive cash back and only paying off mortgage debt
• Maximum CLTV is 150%
VA Underwriting Guidelines
VI. Underwriting Guidelines 5 of 13 06/17/2021
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MANUALLY UNDERWRITTEN TRANSACTIONS
• Non-Traditional, Alternative Credit or No Credit Score loans are ineligible.
• 3-4 Units are ineligible
• Loans receiving an AUS refer response or required to be manually downgraded will be eligible
provided the loan meets all manual underwriting criteria of the VA Lenders Handbook.
MAXIMUM LOAN AMOUNTS
• Loan amounts <$1,000,000 to $1,500,000 require a minimum 620 credit score.
• Loan amounts >$1,500,000 to $2,000,000 require a minimum 660 credit score.
MAXIMUM NUMBER OF FLAGSTAR BANK LOANS
Flagstar will not approve and close loans for borrowers having more than five loans with Flagstar Bank or
having an aggregate loan amount of $4,000,000. The maximum number of loans and aggregate loan
amount calculations include all of the following:
• Non-closed loans with Flagstar Bank and
• Loans that are closed and currently serviced by Flagstar Bank and
• Loans that were closed with Flagstar Bank but the servicing rights have been sold to another lender
within the most recent 24 months
NON-OCCUPANT CO-BORROWERS
Not permitted
POWERS OF ATTORNEY
• Not permitted for cash-out
• Unless Flagstar has experience with the borrower and can compare the signature to a previous
transaction, there must be more than one borrower on a transaction with a POA, and at least on
borrower must be present at closing
PROPERTY ELIGIBILITY
INELIGIBLE
• Properties with a PACE lien that will not be paid off prior to or at closing. Note: HERO loans are
issued under the PACE Program
• Properties located in Puerto Rico
• 3 to 4-unit properties when one or more of the borrowers does not have credit scores
• Properties having both a stick-built and manufactured home located on the same parcel or
property unless the manufactured home is unoccupied and utilities are not hooked up
• Manufactured homes unless the loan is a Flagstar to Flagstar IRRRL:
o Manufactured homes are not permitted in the following states: Colorado, Illinois,
Kentucky, Louisiana, Missouri, New York, Pennsylvania, Texas, or U.S. Virgin Islands
• Condominiums without Homeowner’s Associations are ineligible for Flagstar financing
RATIOS
• Maximum ratio for manually underwritten loans – 47%
• Maximum ratio for loans that receive an AUS approve/accept – 60%
VA Underwriting Guidelines
VI. Underwriting Guidelines 6 of 13 06/17/2021
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RECENTLY LISTED PROPERTIES
• Cash-out and rate and term refinance: Property must be off the market at least one day prior to
application
REFINANCE TRANSACTIONS
• Transactions in which one veteran substitutes entitlement for another veteran are ineligible
• Cash-Out Refinance
o Maximum cash-in-hand 1-2 Unit – Follow AUS
o Maximum cash-in-hand 3-4 Units – $300,000
PROCESSES AND PROCEDURES
4605-C
• If the 4506-C transcripts do not match the borrower’s income and the borrower is a victim of
taxpayer identification theft, the following conditions must be met in order to validate the borrower’s
income:
o Proof of identification theft as evidenced by one of the following:
Proof ID theft was reported to and received by the IRS (IRS form 14039) OR
Copy of notification from the IRS alerting the taxpayer to possible identification theft
o In addition to one of the documents above, all applicable documents below must be
provided:
W2 or 1099 transcripts which match the W2 or 1099 income shown on the 1040s
1099 mortgage interest must match the reported interest on Schedule A or Schedule
E
1099G unemployment must match the reported amount of unemployment
1099 dividend and interest income must match the reported dividend and interest
Validation of prior tax year’s income (income for current year must be in line with
prior years)
APPRAISAL
PROPERTY ADDRESSES
The property addresses on the appraisal, mortgage, note, flood certification and in Loantrac must be
identical. However, abbreviation of “Street,” “Road,” etc. is acceptable, even if “Street” or “Road” is fully
spelled in another document. This is the only acceptable variance.
• Use the standardized USPS address unless the address in the legal description on the title
commitment differs. If the legal address differs, use the legal address
• Appraisers are required to state the USPS address as the property address on the first line of
the appraisal. If the legal address differs from the USPS address, the appraiser must reference
the legal address in a comment on the appraisal or an addendum to the appraisal
PURCHASES AND CASH-OUT REFINANCES
• Appraisals are ordered through WebLGY in the Veteran’s Information Portal. VA provides
access to the portal to lenders who possess a current VA Agent ID and a VA PIN. For additional
information, refer to memo #14050 – Order VA Appraisals/Case Numbers and memo #15067 –
VA LIN, Certificate of Eligibility, CAIVR and Appraisal Processes
VA Underwriting Guidelines
VI. Underwriting Guidelines 7 of 13 06/17/2021
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o Lenders must notify Flagstar when the appraisal has been uploaded to WebLGY by VA.
Email vaappraisal@flagstar.com
• For lenders who have not yet received an Agent ID from VA, Flagstar will order the case
number and appraisal. Lenders must complete VA Case Number/Appraiser Assignment, Doc.
#9701 and forward to fsgovlend@flagstar.com
o If Flagstar orders the appraisal, we will upload the appraisal invoice to the paperless file,
and Flagstar must be paid the appraisal fee
APPRAISAL DISPUTE PROCEDURES
• E-mail at least three additional comps to Flagstar at vaappraisal@flagstar.com
o Provide valid comparables, including MLS data
o The SAR will review the additional comps for similarity, proximity, closing date, etc.
o Upon determination that the new comps are similar to the subject property, the SAR will
submit them to the appraiser for consideration. Appraiser turn time is up to five business
days
• On a limited basis, we will submit the appraisal and appraiser’s rebuttal to VA for consideration
of a higher or lower value. VA’s turn time is ten to 15 business days
o In the event Flagstar believes the appraised value is too high, the loan may be denied
CERTIFICATE OF ELIGIBILITY
A Certificate of Eligibility is required for all VA transactions. The following information is included on a
Certificate of Eligibility:
• Veteran’s full name – The veteran’s name on the Certificate of Eligibility must match the veteran’s
name in WebLGY, Loantrac, the loan guaranty certificate and the note and mortgage
o The following name discrepancies are the only acceptable variations:
James Everett Brown, James E. Brown, James Brown
William Smith Jr., William Smith, William R. Smith, William Ryan Smith, Jr., William
Ryan Smith, William R. Smith, Jr.
o The following name discrepancies must be resolved prior to the loan closing (this list is not
all-inclusive and name discrepancies are reviewed on a case-by-case basis):
Name discrepancies due to marriage (C of E shows Mary Smith, but documentation
in Loantrac, WebLGY and/or the note and mortgage shows Mary Jones) – A copy of
the marriage license is sufficient documentation
Hyphenated name discrepancies (C of E shows Bill Smith, but documentation in
Loantrac, WebLGY and/or the note and mortgage shows Bill Smith-Jones)
Middle name discrepancies (C of E shows Bill John Smith, but documentation in
Loantrac, WebLGY and/or the note and mortgage shows Bill Robert Smith)
First name discrepancies (C of E shows Bill Smith, but documentation in Loantrac,
WebLGY and/or the note and mortgage shows William Smith)
Last name prefix discrepancies (C of E shows Bill St. Pete, but documentation in
Loantrac, WebLGY and/or the note and mortgage shows Bill Stpete)
CLOSING REQUIREMENTS
• Fees must be itemized on the Closing Disclosure per VA Circular 26-17-11.
• Interest credit allowed – Loan must close by the 7th calendar day of the month preceding the first
payment date.
VA Underwriting Guidelines
VI. Underwriting Guidelines 8 of 13 06/17/2021
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• All conditions must be collected and provided in the closing package
o Down payment assistance funds are typically wired to the closing agent – Wire transfer
documentation must be included in the file prior to funding or purchase
• Any changes to loan amount, funding fee, cash-to-close, interest rate, points, PITI, etc. must be
reviewed by underwriter prior to closing and disbursing loan
• Principal reductions are required when the total of lender and/or seller credits reflected on the
Closing Disclosure exceeds the total of the actual closing costs, pre-paid expenses and discount
points
• Principal reductions are required when the borrower receives any cash back at a purchase
transaction closing
o Documented funds paid by the borrower outside of closing for items such as EMD or
appraisal and credit report may be refunded to the borrower at closing – Document funds
paid outside of closing with one of the following:
Cancelled checks
Bank statement showing transfer of funds – If the statement does not indicate the
payee, a copy of the check is also required
Money order receipts and evidence of source of funds
• Principal reductions are required when the borrower is receiving more than $500 cash at closing on
an interest rate reduction refinancing loan.
NOTARY POLICY
Refer to the Notary Policy stated in Settlement/Closing Requirements, Doc. #4601
CONFLICT OF INTEREST
Transactions in which the realtor and the originator are the same individual are eligible.
CREDIT REPORTS
All credit reports must be imported to Loantrac, including credit reports for IRRRL transactions.
AGE OF CREDIT REPORTS
• To achieve Flagstar’s and VA’s minimum credit requirements, a new credit report may be repulled after a borrower has repaired derogatory credit, and Flagstar will honor the new credit
score. The new credit report must be imported to Loantrac
• The following credit report discrepancies require a new credit report:
o Social Security number is incorrect
o Last name is incorrect
o Middle initial is incorrect
o Misspelled first names and/or missing or incorrect suffixes (Jr./Sr.) require a new credit
report unless the name variation appears in the AKA section of the credit report
DE CUSTOMERS ONLY
• Credit report must contain Office of Foreign Assets Control (OFAC) screening
• If credit report indicates a potential OFAC match, the credit report must be e-mailed to
delegated.underwriting@flagstar.com for review by Flagstar Bank’s Secrecy Act Compliance
VA Underwriting Guidelines
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Department – The loan may not close without clearance from Flagstar’s BSA Department
(violation of this policy is a federal crime)
ELECTRONIC SIGNATURES
• Electronic signatures are permitted for all VA loan documents except the following:
o Powers of attorney
o Form SSA-89
o Note and Mortgage – While VA accepts these, at this time, GNMA does not
ESCROWS
• Escrow waivers not allowed
• Generally, property tax escrows for all new construction properties must be calculated based on the
fully assessed property value. Obtain actual tax amounts from the local tax assessor’s office. If the
new construction property taxes charged by the municipality will not be based on the fully improved
property within 12 months of closing, escrows may be based on one of the following. Note:
Regardless of assessment dates, ratios and reserves must be calculated based on the fully
assessed property value.
o Lot only or
o A partial assessment or
o Actual or estimated amount based on fully assessed value
o The Closing Department will require the borrower(s) to confirm that once the property is fully
assessed, they are aware of the potential escrow shortage
• For purchases of new and existing properties in California only, property taxes may be calculated
using 1.25% of the purchase price or the actual tax rate
ESCROW HOLDBACKS
• Allowed only for exterior property repairs that cannot be completed due to inclement weather
• Fully executed Escrow Holdback Agreement, Doc. #3655 required in closing package
IMMIGRATION STATUS
• DACA c(33) is a work status that is under a deferred action and does not provide lawful status,
therefore, Individuals that are working under DACA authorization are not eligible
INDUSTRY LINKS/FLAGSTAR LINKS AND CONTACTS
• VA Lender’s Handbook – VA Pamphlet 26-7
• VA Circulars
• VA Construction and Valuation
• VA Loan Limits
• VA Lender’s, Servicers and Real Estate Professionals Page
• VA-Approved Condos Search Engine
• VA-Registered Builders Search Engine
• VA Construction and Valuation – State Requirements
• WebLGY User Administration Guide
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• DFAS My Pay – For Leave and Earnings Statements – Veteran’s PIN required
• Active-Duty Verbal Verifications of Active Duty
o Army or Air Force – 888-729-2769
o Marines – 888-332-7411
o Navy – 888-332-7411
o Civilian Defense – 800-729-3277
• About.com – US Military Pay – Defines Abbreviations and provides Pay Charts, etc.
• Federal Income Tax Tables
o IRS Federal Tax Tables
• State Income Tax Tables
o Bank Rate – State Tax Roundup
• Flagstar Bank Government Underwriting Help Desk
o E-Mail: governmentuw@flagstar.com
o Phone: 866-945-9872: Select option 1 for Underwriting and option 2 for Government
Underwriting
INSURANCE
HAZARD INSURANCE
Hazard Insurance Requirements, Doc. #4602
FLOOD INSURANCE
• Flood Insurance Requirements, Doc. #4603
• Eligible Flood Provider Companies- FEMA Flood Insurance Company List
• Private flood insurance meeting the requirements of the Biggert-Waters Flood Insurance Reform
Act of 2012, however, all improvements, including detached structures must be insured.
LOAN TERM
FIXED RATE MORTGAGES
10, 15, 20, 25 and 30-year fixed rate mortgages
ARMS
3/1 and 5/1 CMT adjustable-rate mortgages without temporary buydowns
MAXIMUM LOAN AMOUNTS
LOAN AMOUNT RESOURCES
• 2021 VA County Loan Limits for High Cost Counties
• VA Guaranty Calculation Examples
• VA Mortgage Calculation Worksheet – Purchase Loan Amounts ≤ $144,000, Doc. #9740
• VA Mortgage Calculation Worksheet – Purchase Loan Amounts > $144,000, Doc. #9741
• VA Mortgage Calculation Worksheet – Refinance Loan Amounts ≤ $144,000, Doc. #9742
• VA Mortgage Calculation Worksheet – Refinance Loan Amounts > $144,000, Doc. #9743
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NET TANGIBLE BENEFIT
A net tangible benefit form must be completed when required by the state and for any Cash-Out and
Interest Rate Reduction Refinance (IRRRL).
POWERS OF ATTORNEY
All signatures on the power of attorney must be notarized, and the power of attorney must be reviewed by
a Flagstar underwriter. All signatures must match the signatures in the file.
QUALIFIED MORTGAGES (QM)
With the exception of the VA IRRRLs described below, VA’s Interim QM Rule classifies all VA loans as
Safe Harbor Qualified Mortgages.
IRRRLS
IRRRLs meeting all of the following criteria are classified as Safe Harbor QMs:
• The note date of the refinance loan must be on or after the later of:
• The date that is 210 days after the due date of the first monthly payment on the mortgage being
refinanced, and
• The date on which 6 consecutive full monthly payments have been made on the mortgage being
refinanced
• The veteran has not been more than 30 days past due during the six months preceding the new
loan’s closing date and
• The number of months to recoup the allowable fees and charges associated with the loan does
not exceed 36 months
o All of the following costs are included in the recoup calculation:
Fees paid on behalf of the veteran through lender credits and premium pricing
may be excluded from the calculation if they offset allowable fees listed in
Chapter 8 of VA Pamphlet 26-7
The funding fee is excluded.
Pre-paid expenses that would have been payable under the loan being
refinanced are not included in the recoupment calculation. Examples of pre-paid
expenses are property taxes, homeowner’s insurance premiums and HOA dues
o If the payment increases due to a decreased loan term or conversion of an ARM to fixed
rate mortgage, the Veteran cannot incur any fess, closing costs or expenses (other than
taxes, amounts held in escrow, and fees paid under Chapter 37, e.g. VA Funding Fee)
o The number of months to recoup is calculated using VA Net Tangible Benefit & Loan
Disclosure, Doc. #9723-A and Doc. #9723-B
IRRRLs not meeting the criteria above are not acceptable to VA.
For additional info, refer to Interim Final Rule – Ability to Repay Standards and QM Definition
TITLE
Effective date of title commitment must be no older than 90 days as of initial underwrite and within 120
days of the note.
VA Underwriting Guidelines
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ENERGY LOAN TAX ASSESSMENT PROGRAM (ELTAP) LIENS
Not permitted
UNEXPIRED RIGHTS OF REDEMPTION – ALL STATES EXCEPT ALABAMA
• Unless the property is located in the State of Alabama, Flagstar will not approve and/or
purchase any loan having an unexpired right of redemption unless the purchase agreement, title
and appraisal all show the same seller who is the original mortgagor
o Title may show lis pendens notices from the bank or mortgagee
• Purchase contract may indicate a short sale
• Unexpired Rights of Redemption – Alabama Only
o Purchase agreement, title and appraisal will be in the name of the lender and not the
original mortgagor.
o Title commitment will show one or both of the following acceptable recorded deeds:
Foreclosure from John Doe (original mortgagor) to Anybank (foreclosing lender)
followed by the date on the deed and the recording date
When the foreclosing lender deeds the property to HUD, Fannie Mae, Freddie
Mac, VA or GNMA, there will be a special warranty deed from Anybank
(foreclosing lender) to one of the GSEs listed above followed by the date on the
deed and the recording date
o If the above referenced deeds are dated within the most recent 12 months, the title
commitment must contain a specific exception for the unexpired right of redemption and
affirmatively insure, without qualification, the mortgagee (Flagstar Bank) against all
losses arising out of the exercise of any outstanding right of redemption
UNDERWRITING
VA PRIOR APPROVAL
The following loans require submission of the loan to VA for underwriting and approval prior to loan
closing:
• Joint Loans (See Joint Loan section for definition and additional information, including joint loan
eligibility/ineligibility)
• Loans to veterans who receive non-service-connected pensions
• Loans to veterans who have been rated incompetent by VA
• IRRRL loans made to refinance delinquent VA loans
VA REGIONAL LOAN CENTERS
NATIONAL CALL CENTER – 877-827-3702
• Select 1 if you know your party’s extension
• Select 2 if you are calling regarding VA funding fee
• Select 3 if you are a veteran or a lender obtaining or processing a VA loan
• Select 4 if you are a homeowner having difficulty making your mortgage payment or are in
foreclosure, or if you are a servicer.
• Select 5 if you have questions about the Specially Adapted Housing Grant through VA
• Select 6 if you have questions about an appraisal, building ID or condominium project approval
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• Select 7 regarding Certificate of Eligibility. Note: Most Certificates of Eligibility can be obtained online by the Veteran through eBenefits or the lender through WebLGY
• Select 0 if you are calling concerning other benefits such as Education, Health Care or Disability
Benefits
For options 2 and 3, calls will be answered on a nationwide basis by the next RLC representative. Calls for
options 4 and 5 will be answered by the RLC with jurisdiction based on the caller’s area code.
CLEVELAND REGIONAL LOAN CENTER
Ohio, Michigan, Indiana, Pennsylvania, New Jersey, Delaware, Connecticut, Maine, Massachusetts, New
Hampshire, New York, Rhode Island, Vermont
HOUSTON REGIONAL LOAN CENTER
Texas, Arkansas, Oklahoma, Louisiana
ST. PAUL REGIONAL LOAN CENTER
Minnesota, Iowa, Illinois, Kansas, Missouri, North Dakota, Nebraska, South Dakota, Wisconsin
ATLANTA REGIONAL LOAN CENTER
Georgia, South Carolina, North Carolina, Tennessee
DENVER REGIONAL LOAN CENTER
Colorado, Alaska, Idaho, Montana, Oregon, Utah, Washington, Wyoming
PHOENIX REGIONAL LOAN CENTER
Arizona, California, Nevada, New Mexico
ROANOKE REGIONAL LOAN CENTER
Virginia, District of Columbia, Kentucky, Maryland, West Virginia
ST. PETERSBURG REGIONAL LOAN CENTER
Florida, Alabama, Mississippi, Puerto Rico, U.S. Virgin Islands
HONOLULU REGIONAL OFFICE
Hawaii, Guam, American Samoa Commonwealth of the Northern Mariana Islands
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