Slide 1: Fannie Mae's RefiNOW: An Overview
Fannie Mae’s RefiNOW An Overview June 2021 Genworth Mortgage Insurance Corporation and Genworth Mortgage Insurance Corporation of North Carolina ©2021 Genworth Mortgage Insurance Corporation. All rights reserved.
Slide 2: Genworth MI is now Enact
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Slide 3: Webinar communication box instructions
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Slide 4: RefiNOW Mortgage
RefiNOW Mortgage Fannie Mae is introducing the refinance option designed to assist lower-income borrowers earning 80% or less of area median income (AMI) on an existing Fannie Mae-owned mortgage. More borrowers will be eligible to take advantage of the current low interest rate environment. 4
Slide 5: RefiNOW Mortgage – Borrower Benefit
RefiNOW Mortgage – Borrower Benefit The refinanced loan must provide the following benefits to the borrower: • a reduction in interest rate of at least 50 basis points, and • a reduction in the monthly payment that includes principal, interest, and the mortgage insurance payment (if applicable) of a
Slide 6: Program Overview
Program Overview Fannie Mae Lender Letter, DU/DO Release Notes 6
Slide 7: Fannie Mae Communications
Fannie Mae Communications https://singlefamily.fanniemae.com/media/25701/display https://singlefamily.fanniemae.com/media/25696/display 7
Slide 8: RefiNOW Mortgage
RefiNOW Mortgage Fannie Mae is committed to fulfilling their affordable housing mission to serve low-income borrowers by offering home financing options that help them build equity and grow wealth, while continuing to promote a stronger, safer housing finance system. Barriers that hamper low- income
Slide 9: RefiNOW Mortgage – Effective Date
RefiNOW Mortgage – Effective Date During the weekend of June 5, 2021, Fannie Mae implemented an update to Desktop Underwriter® (DU®) Version 11.0, which included the implementation of the RefiNow™ refinance option. The changes in this release applied to DU Version 11.0 loan casefiles submitted or re
Slide 10: Requirements
Requirements Eligibility Parameters: Existing Mortgage Being Refinanced 10
Slide 11: RefiNOW Mortgage – Borrower Income
RefiNOW Mortgage – Borrower Income The borrower(s) income must be less than or equal to 80% of the applicable AMI limit for the subject property’s location. • In determining whether a loan is eligible under the borrower income limits, the lender must consider the income from all borrowers who will s
Slide 12: RefiNOW Mortgage – Change in Borrower
RefiNOW Mortgage – Change in Borrower The loan must have identical borrowers on the new loan as the existing loan. New borrowers cannot be added or removed. One or more borrowers may only be removed if: • the remaining borrower(s) meet the payment history requirements and provides evidence that they
Slide 13: RefiNOW Mortgage – General Eligibility
RefiNOW Mortgage – General Eligibility The Mortgage being refinanced must: • Be a First Lien, conventional Mortgage currently owned by Fannie Mae, in whole or in part, or securitized by Fannie Mae. • Be seasoned for at least 12 months and no more than 120 months (i.e., the Note Date of the Mortgage
Slide 14: RefiNOW Mortgage – Exclusions
RefiNOW Mortgage – Exclusions The Mortgage being refinanced must not be: • mortgage note date is not within 10 years of the casefile creation date, • DU Refi Plus™ or manual Refi Plus™, • High LTV refinance, • RefiNow, • subject to investor paid mortgage insurance, • pledged asset loan, • subject to
Slide 15: RefiNOW Mortgage – Eligibility
RefiNOW Mortgage – Eligibility When the existing loan is eligible to be refinanced using the RefiNow refinance option, DU will determine if the new loan meets the RefiNow eligibility requirements. If the new loan includes any of the features below that are not eligible with the RefiNow refinance opt
Slide 16: RefiNOW Mortgage – Manual Eligibility
RefiNOW Mortgage – Manual Eligibility There are eligibility guidelines that DU will not be able to confirm. DU will issue messages reminding lenders of these guidelines on specific transactions: • When the subject property is located in Texas, the DU message will require the lender to confirm that t
Slide 17: RefiNOW Mortgage – Payment History
RefiNOW Mortgage – Payment History For the loan being refinanced, the borrower cannot have had: • any 30-day mortgage delinquencies in the most recent six-month period, and • no more than one 30-day delinquency in months 7 through 12. 17
Slide 18: Mortgage Eligibility Requirements
Mortgage Eligibility Requirements When DU finds a loan for the subject property address using either the address provided on the DU loan application or the standardized address, DU will then confirm that the Social Security number(s) (SSN) for the borrower(s) on the new loan casefile matches that on
Slide 19: Mortgage Eligibility Requirements
Mortgage Eligibility Requirements When there is an SSN match, DU will underwrite the loan casefile as RefiNow. If the SSN for any of the borrowers on the loan casefile do not match using all nine digits, DU will advise the lender as follows: • When a borrower SSN is matched using 7 or 8 digits of th
Slide 20: New Mortgage (Refinance) Underwriting Requirements
New Mortgage (Refinance) Underwriting Requirements 20
Slide 21: Underwriting Path
Underwriting Path Loans may be underwritten with DU. DU will automate the identification of loan casefiles that appear to be eligible for RefiNow based on the borrowers listed on the loan application, the property address, qualifying income, and several other factors. Refer to the Release Notes for
Slide 22: General Eligibility
General Eligibility The RefiNOW Mortgage must be a fixed-rate Mortgage Be a limited cash-out refinance with • financed closing costs, prepaid items and points that do not exceed $5,000, and • cash out less than or equal to $250. Excess proceeds may be applied as a curtailment on the new loan. Have a
Slide 23: Occupancy and Property Eligibility
Occupancy and Property Eligibility The Refi Possible Mortgage must be secured by a one-unit Primary Residence For Mortgages secured by Condominium Units or Cooperative Share Loans, the Seller is not required to evaluate if the Condominium or Cooperative Project meets the project eligibility requirem
Slide 24: Maximum LTV, TLTV HTLTV
Maximum LTV, TLTV HTLTV 24 1-unit other than Manufactured Homes 97%* Manufactured Homes 95% Mortgage with a non-occupying Borrower 95%* *A TLTV ratio up to 105% is permitted when secondary financing is an Affordable Second®. “Enact
Slide 25: Borrower Benefit
Borrower Benefit The proceeds of the RefiNOW Mortgage must be used only to: • Pay off the first Mortgage • Pay related Closing Costs not to exceed $5,000 • Disburse cash to the Borrower not to exceed $250 Any excess proceeds must be applied as a principal curtailment to the RefiNOW Mortgage. 25
Slide 26: Minimum Credit Score
Minimum Credit Score The loan must have a minimum representative credit score of 620. The borrower must comply with all applicable waiting periods following derogatory credit events in B3-5.3-07, Significant Derogatory Credit Events – Waiting Periods and Re-establishing Credit. (Exception: The LTV r
Slide 27: Maximum Housing Ratio and DTI
Maximum Housing Ratio and DTI There is no maximum housing expense-to-income ratio The total monthly DTI ratio must be less than or equal to 65%, including when a non-occupying Borrower is present 27
Slide 28: Income and Employment Documentation
Income and Employment Documentation 28
Slide 29: Property Valuation
Property Valuation Standard property valuation requirements for an appraisal waiver or appraisal apply. A $500 credit will be provided to the lender at the time the loan is purchased if an appraisal was obtained for the transaction. The lender must pass the credit to the borrower. NOTE: The appraisa
Slide 30: Pricing
Pricing All standard loan-level price adjustments apply. The adverse market refinance fee of 50 basis points will be waived for loans with an original principal amount less than or equal to $300,000. See the Loan-Level Price Adjustment Matrix. NOTE: The waiver of the adverse market refinance fee for
Slide 31: Mortgage Insurance Coverage
Mortgage Insurance Coverage All standard mortgage insurance requirements apply in accordance with the Selling Guide. Mortgage insurance coverage for RefiNow loans is not restricted to the current mortgage insurer on the existing loan. However, DU will identify the insurer that is currently providing
Slide 32: Solicitation
Solicitation 32 v Permissible solicitation for RefiNow loans to borrowers at or below 80% of AMI Lenders may s borrowers with mortgages owned or securitized by a particular GSE, provided that the lender simultaneously applies the same advertising and solicitation activities with respect to borrowers
Slide 33: Freddie Mac Refi Possible: An Overview
Freddie Mac Refi Possible An Overview June 2021 Genworth Mortgage Insurance Corporation and Genworth Mortgage Insurance Corporation of North Carolina ©2021 Genworth Mortgage Insurance Corporation. All rights reserved.
Slide 34: Refi Possible Mortgage
Refi Possible Mortgage Freddie Mac’s Refi Possible mortgage offering is designed to assist lower-income borrowers earning 80% or less of area median income (AMI) on an existing Freddie Mac-owned mortgage. Eligible borrowers will receive meaningful refinancing benefits including a reduction in intere
Slide 35: Program Overview
Program Overview Freddie Mac Bulletin, Program Eligibility Parameters 35
Slide 36: Bulletin 2021-17
Bulletin 2021-17 https://sf.freddiemac.com/articles/news/guide-bulletin-2021-17-introducing-freddie-mac-refi-possible 36
Slide 37: Refi Possible Mortgage
Refi Possible Mortgage Assist Borrowers This offering creates more equitable opportunities by making it easier for homeowners in low-income brackets to refinance their Mortgages. Refi Possible is intended to reach low-income Borrowers who can benefit from refinancing and provides flexibilities to in
Slide 38: Refi Possible Mortgage- Effective Date
Refi Possible Mortgage- Effective Date Refi Possible is available for Manually Underwritten Mortgages with Application Dates on and after August 30, 2021, and for submissions to Loan Product Advisor® on and after August 30, 2021. 38
Slide 39: Requirements
Requirements Eligibility Parameters: Existing Mortgage Being Refinanced 39
Slide 40: Refi Possible Mortgage-Borrower Income
Refi Possible Mortgage-Borrower Income • The Borrower's qualifying income converted to an annual basis must not exceed 80% of the area median income (AMI) for the location of the Mortgaged Premises • To determine if the Borrower's income exceeds the income limits, the Seller must rely on the income
Slide 41: Refi Possible Mortgage- Change in Borrower
Refi Possible Mortgage- Change in Borrower The Borrower(s) obligated on the Note for the Refi Possible Mortgage must be the same as the Borrower(s) obligated on the Note for the Mortgage being refinanced, except that a Borrower obligated on the Note for the Mortgage being refinanced may be omitted f
Slide 42: Refi Possible Mortgage-General Eligibility
Refi Possible Mortgage-General Eligibility The Mortgage being refinanced must: • Be a First Lien, conventional Mortgage currently owned by Freddie Mac, in whole or in part, or securitized by Freddie Mac • Be seasoned for at least 12 months and no more than 120 months (i.e., the Note Date of the Mort
Slide 43: Refi Possible Mortgage-Ineligible Mortgages
Refi Possible Mortgage-Ineligible Mortgages The Mortgage being refinanced must not be: • A Freddie Mac Relief Refinance Mortgage℠ • A Freddie Mac Enhanced Relief Refinance® Mortgage • A Refi Possible Mortgage • A Mortgage subject to an outstanding repurchase request • A Mortgage subject to recourse,
Slide 44: Refi Possible Mortgage- Payment History
Refi Possible Mortgage- Payment History The Mortgage being refinanced must have a payment history that indicates the following: • The Mortgage has not been 30 days delinquent in the most recent six months; and • The Mortgage has not been 30 days delinquent more than once in the most recent 12 months
Slide 45: Loan Product Advisor Assessment
Loan Product Advisor Assessment Loan Product Advisor will assess whether the Mortgage being refinanced complies with the eligibility requirements including: • Borrower Income • Change in Borrowers • General Eligibility • Ineligible Mortgages • Payment History with the following exceptions: • The Sel
Slide 46: Mortgage Eligibility Requirements
Mortgage Eligibility Requirements Determining if Freddie Mac Owns Present Mortgage 46
Slide 47: New Mortgage (Refinance) Underwriting Requirements
New Mortgage (Refinance) Underwriting Requirements 47
Slide 48: Underwriting Path
Underwriting Path The Refi Possible Mortgage must be: • Submitted to Loan Product Advisor or • Manually underwritten, provided that the loan is otherwise eligible for manual underwriting 48
Slide 49: General Eligibility
General Eligibility The Refi Possible Mortgage must be a fixed-rate Mortgage The Refi Possible Mortgage must not be: • A Mortgage with a temporary interest rate buydown • A super conforming Mortgage • Originated pursuant to Section 50(a)(6) of Article XVI of the Texas Constitution. Refer to Guide Se
Slide 50: Occupancy and Property Eligibility
Occupancy and Property Eligibility The Refi Possible Mortgage must be secured by a one-unit Primary Residence For Mortgages secured by Condominium Units or Cooperative Share Loans, the Seller is not required to evaluate if the Condominium or Cooperative Project meets the project eligibility requirem
Slide 51: Maximum LTV, TLTV HTLTV
Maximum LTV, TLTV HTLTV 51 1-unit other than Manufactured Homes 97%* Manufactured Homes 95% Mortgage with a non-occupying Borrower 95%* *A TLTV ratio up to 105% is permitted when secondary financing is an Affordable Second®. “Enact
Slide 52: Borrower Benefit
Borrower Benefit The refinance transaction must result in both of the following: • A First Lien Mortgage interest rate reduction of at least 50 basis points (bps) AND • For Mortgages with an LTV ratio equal to or less than 80%, a reduction in the First Lien Mortgage Principal and Interest payment am
Slide 53: Borrower Benefit
Borrower Benefit The proceeds of the Refi Possible Mortgage must be used only to: • Pay off the first Mortgage • Pay related Closing Costs not to exceed $5,000 • Disburse cash to the Borrower not to exceed $250 In the event there are remaining proceeds from the Refi Possible Mortgage after the proce
Slide 54: Minimum Credit Score
Minimum Credit Score The Mortgage must have a minimum Indicator Score of 620. If no Borrower has a usable Credit Score, then the Mortgage does not have an Indicator Score and is not eligible for delivery to Freddie Mac. 54
Slide 55: Credit Assessment- Manual Underwrite
Credit Assessment- Manual Underwrite For Manually Underwritten Mortgages, the Seller does not need to perform a credit assessment of the Borrower in accordance with Chapter 5202 provided that: In addition to meeting the payment history requirements for the Mortgage being refinanced, the Mortgage com
Slide 56: Maximum Housing Ratio and DTI
Maximum Housing Ratio and DTI There is no maximum housing expense-to-income ratio The total monthly DTI ratio must be less than or equal to 65%, including when a non-occupying Borrower is present 56
Slide 57: Income and Employment Documentation
Income and Employment Documentation The minimum documentation requirements in the table below apply to the referenced income types in lieu of the Streamlined Accept and Standard Documentation Level requirements stated for these income types in Guide Topic 5300 All other income types must be document
Slide 58: Income and Employment Documentation
Income and Employment Documentation The minimum documentation requirements in the table below apply to the referenced income types in lieu of the Streamlined Accept and Standard Documentation Level requirements stated for these income types in Guide Topic 5300 All other income types must be document
Slide 59: Asset Documentation Requirements
Asset Documentation Requirements When funds required for closing are more than $500, funds in a depository, securities or retirement account used for closing must be documented with one-month account statement or a direct account verification When funds required for closing are $500 or less, verific
Slide 60: Property Valuations
Property Valuations Standard Guide property valuation requirements for appraisal or automated collateral evaluation apply. A $500 credit will be provided to the Seller when an appraisal is obtained. The Seller must pass the credit to the Borrower. 60
Slide 61: Pricing
Pricing Standard Credit Fees in Price apply. Refi Possible Mortgages with an original Note amount of less than or equal to $300,000 are not subject to the 50 bps Market Condition Credit Fee in Price. 61
Slide 62: Mortgage Insurance Coverage
Mortgage Insurance Coverage Mortgages with LTV ratios greater than 80% must have mortgage insurance coverage in accordance with Chapter 4701. 62
Slide 63: Acceptable Refinance Practices
Acceptable Refinance Practices Advertising and solicitation: Seller may target Mortgages owned or securitized by Freddie Mac for the Refi Possible offering, provided that the Seller simultaneously applies the same advertising and solicitation activities with respect to Borrowers of Mortgages with AM
Slide 64: Acceptable Refinance Practices
Acceptable Refinance Practices Advertising and other communications with Borrowers: If a Seller chooses to reach out to Borrowers and the Seller's communication includes a reference to Freddie Mac, then the communication must also include the following (or substantively similar) verbiage: Freddie Ma
Slide 65: Enact Rate Express
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Slide 66: Enact Underwriting Guidelines
Enact Underwriting Guidelines 66
Slide 67: Enact Training Resources
Enact Training Resources Enact ——— =— MIBRATES | UNDERWRITING 8 GUIDES | LOS& CONNECTIONS | ENACT TOOLKIT TRAINING We've changed to emain focused on you. Genworth MI is now Enact. fe & Training Blass 9°08" Your Knowledge LEARN NOW Underwriting Innovate Underwriting KNOW Mone 6 “Enact
Slide 68: Enact Training Resources
Enact Training Resources 68 Self-Employed Borrower Tools by Enact MI We get it, mental math is hard. That's why Enact provides a collection of dawnloadiable calculators and reference guides to help you analyze a self-employed borrower's average monthly income and expenses, Please note that these too
Slide 69: Your Enact Resources
Your Enact Resources • ActionCenter® : 800 444.5664 • Your Local Enact Regional Underwriter • Your Enact Sales Representative 69
Slide 70: Legal Disclaimer
Legal Disclaimer Enact Mortgage Insurance is happy to provide you with these training materials. While we strive for accuracy, we also know that any discussion of laws and their application to particular facts is subject to individual interpretation, change, and other uncertainties. Our training is