#Two4Tuesday – Guideline Day – FNMA Updates galore! Fannie Mae has been busy this month, with several key updates. Some that may just affect your loans in process! So excited for the new 1003 to come out, just as the past the disclosure “roll out” as optional has been post-poned! The actual roll out date will be too, but we just have to wait for the next update that let’s us know when we can roll out the optional use of the new application.
Some good updates this month, and I hear and see other LO’s mentioning that DU seems a little tighter already. This is the second time in the last 90 days that DU has been updated. And this time Fannie is really vague on what was updated, other than specifically identifying “other risk factors”. This comes down to DTI, reserves and LTV, mark my word, some LO is gathering conditions from a loan and in the last 5 days their file has not been re-ran through DU. And when it does on the final time, there will need to be a restructure to make it work. Risk thresholds are being updated and over time after running so many DU run’s we’ll be able to report back to you and let you know what changed. Just remember the basics on DTI for FHA/VA and Conv.
FHA – Three buckets depending on how many compensating factors your file has 31/43 & 37/47 & 40/50
VA – One major backend threshold that is mentioned and that is 41. There is also note of use of residual income as a compensating factor. (this has been the loosest one of them all over the years and more recently have had personally a VA loan with as high as 82 DTI close)
Conventional – While it is widely known that conventional goes to 50 DTI (49.999) in the books (ed) and in programming the thresholds of 28/36 are used. So if your file is over that, you should have compensating factors.
Risk is risk and when it comes down to it, there seems no two files are the same. Just watch your risk thresholds on active loans as DU is updated, and keep rocking.
As Always –