Fannie Mae "Loan Quality Initiative" begins June 1, 2010. How will this affect home buyers?

Reblogger Gabe Sanders
Real Estate Agent with Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales 3090099

Some new Fannie Mae rules going into effect on June 1'st.  Here's a fine summary from Amy Jones:

Original content by Amy Jones Group DRE# SA528757000

Beginning with applications dated June 1st, Fannie Mae is implementing the “Loan Quality Initiative” (LQI) guidelines.  All Fannie Mae lenders must adhere to these guidelines.  In a nutshell, the LQI guideline changes are:

  1. fannie mae loansCredit re-verification the day of funding:  Fannie Mae will require the borrower’s credit to be repulled the day of funding.  If the credit obligations change by more than 2%, the loan is required to go back to underwriting for approval.  Peoples Mortgage will reverify credit obligations on the borrower’s credit report (this will not be a hard pull of credit and will not affect their credit score; it is simply a verification of all current obligations).  Buyers should be made aware of  this rule so they know they should not purchase any large ticket items or have their credit pulled during the escrow process.  This could end up disqualifying them from buying their home at the very last minute.  This has always been true, but some lenders were not in the practice of pulling credit toward the end of escrow.  Now it will be mandated
  2. Excluded Party Lists:  Fannie Mae will require all parties to the transaction be checked against the “excluded party” lists, which are managed by HUD and by the General Services Administration.  These federal lists cover a broad array of risk categories, including fraud, gross negligence, and lack of business integrity.  Individuals have been placed on these lists for both mortgage-specific and non-mortgage-specific activities.  Government loans have always used the GSA list to exclude anyone included.  This will not impact most borrowers.  Those borrowers who are on the list are aware they are on the GSA list;
  3. Social Security Number Validation: The borrower’s social security number must be validated.  Depending on the findings of the credit report pull and “Desktop Underwriting”, the borrower may be requested to show their valid social security card or additional documentation; in some cases the underwriting lender may be requested to contact the Social Security Administration to verify a SSN.
  4. Validation of Intent to Occupy:  Fannie Mae is requiring all investors to verify the borrower’s intent to occupy the property.  This may include employing 3rd-party services that specialize in investigating occupancy information, reviewing the hazard insurance policy or utility bills to confirm occupancy of the property following funding of the loan.  This has been an issue for years with buyers claiming they intend to occupy the premises in order to obtain a lower interest rate, with the full intention of using the property as a rental. 

Please speak with your Lender for more information and details or visit Fannie Mae Loan Quality Initiatives Frequently Asked Questions.

I feel these are all positive changes.  A little like closing the barn door once the horse has escaped...but positive changes nonetheless.  What do you think?

  _______________________________________________________________________________________________________________________________

    Chandler homes for sale               Sun Lakes Homes for Sale               Gilbert Homes for Sale         Tempe Homes for Sale       Ahwatukee Homes for Sale
Search Chandler Homes      Search Sun Lakes Homes       Search Gilbert Homes        Search Tempe Homes     Search Ahwatukee Homes

Amy_Jones_RealtorAmy Jones, REALTOR, ABR, CNE, EPro, CDPE
Direct~480-250-3857
Chandler, Sun Lakes, Gilbert, Tempe & Ahwatukee Real Estate
Phoenix Business Journal "Top 50 Real Estate Agent"
 
REMAX Excalibur

4921 S. Alma School Rd
Chandler, Arizona 85248

Visit www.AmySellsAZ.com for more information including free MLS search.
Visit
www.PhoenixArizonaRealEstateBlog.com  for a comprehensive Phoenix Area Blog.
Visit
www.SunLakesBlog.com about living in Sun Lakes, AZ.
Check out home values in your neighborhood!

 

close

This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At

Post a Comment
Spam prevention
Spam prevention
Show All Comments
Rainmaker
4,797,261
Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

Thank you for stopping by and taking the time to read my re-blog.

Jun 16, 2015 07:03 AM #1
Post a Comment
Spam prevention
Show All Comments

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?

Rainmaker
4,797,261

Gabe Sanders

Stuart Florida Real Estate
Ask me about Stuart FL real estate
*
*
*
*
Spam prevention

Additional Information