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Conventional Updates - 4/30/18

Effective with new applications on or after April 30, 2018, the conventional products will be updated in order to better align with Fannie Mae and Freddie Mac guidelines.

MAXIMUM LTV/CLTV/HCLTV

  • For Fannie Mae purchase and no cash-out refinances on ARMs, the LTV/CLTV/HCLTV has been increased from 90% to 95%.
  • For Freddie Mac purchase and no cash-out refinance fixed and ARMs, the LTVs/CLTVs have been increased for 2-unit primary residences from 80% to 85%, and second homes from 85% to 90%.
    • Reminder: Loans with eligible secondary financing require a 5% LTV reduction from the maximum LTVs listed in the matrix.

UNDERWRITING GUIDELINE UPDATES:

  • The underwriting guidelines have been updated to remove the requirement for a field review on certain properties valued at $1,000,000 or more, with an LTV/CLTV/HLCTV greater than 75%.
  • For DU scored loans on cash-out refinances, properties held in an LLC or an inter-vivos revocable trust are eligible to count towards the seasoning requirement when no borrowers have been on title to the subject property for at least six months. Additional requirements apply.
  • Detached condominiums or Fannie Mae to Fannie Mae or Freddie Mac to Freddie Mac rate and term refinances less than or equal to 80% LTV/CLTV/HCLTV will no longer require a Limited Review. These will still need to be submitted to the Project Review Department.
  • Removed references to Special Designation from the TPO version of the product profile in regard to Florida condos.
  • The allowable maximum amount for an escrow holdback on a primary residence has been increased to the lesser of agency requirements or $10,000. Previously escrow holdbacks were limited to a maximum of $5,000.Refinance purpose type must be “Student Loan Cash-Out Refinance” in Destiny

Refer to the updated product profiles posted to the Product Profiles page for all requirements.