Enact Holdings, Inc. · NASDAQ:ACT
Enact — Investor Presentation (December 2018)
83 slides from Enact's investor presentation, December 2018
Slide 1: Understanding the Loan Product Advisor Feedback Certificate
Loan Product Advisor® Understanding the Loan Product Advisor Feedback Certificate December 2018 Genworth Mortgage Insurance Corporation ©2018 Genworth Financial, Inc. All rights reserved.
Slide 2: Agenda
Agenda Loan Product Advisor® – Resources – What is Loan Product Advisor – Recent Updates – How To Read the Results – How To Document Your File – Data Integrity Reminders – Documentation Matrix – Help Tools and Training – Genworth Today’s Session Covers Conventional Loans Only Loan Product Advisor 2
Slide 3: Freddie Mac Updates - Where To Get Them
Freddie Mac Updates - Where To Get Them Freddie Mac’s Website – http://www.freddiemac.com/loanadvisorsuite/ – Single Family News – Pending Loan Product Advisor Enhancements – Subscription Center – Links to www.freddiemac.com – Learning Center Loan Product Advisor 3
Slide 4: Loan Product Advisor
‘You are viewing: 6304.1: Stable monthly income and documentation requirements for self-employed Borrowers (03/02/16) 4 Erevious| Nex» Blew Full Screen Reference Single-Family Seller/Servicer Guide, Bulletins and Industry Letters ‘Single-Family Seller/Servicer Guide Selling Series £000: Origination
Slide 5: What is Loan Product Advisor?
What is Loan Product Advisor? – Loan Product Advisor is Freddie Mac’s automated underwriting system – It gives users access to Freddie Mac’s credit requirements, allowing you to easily identify the overall underwriting risk – It replaces Loan Prospector® http://www.freddiemac.com/singlefamily/pdf/Lo
Slide 6: Loan Product Advisor is Part of the Loan Advisor Suite
Loan Product Advisor is Part of the Loan Advisor Suite Loan Product Advisor 6
Slide 7: Loan Product Advisor Functionality Guide
Loan Product Advisor Functionality Guide – Updated November 2018 – Assists with data entry – Error messages – Correcting errors – Assigning a loan http://www.freddiemac.com/learn/pdfs/uw/fun_guide.pdf Loan Product Advisor 7
Slide 8: What Risk Factors is Loan Product Advisor Looking at?
What Risk Factors is Loan Product Advisor Looking at? Loan Product Advisor 8
Slide 9: Recent Freddie Mac Updates
Recent Freddie Mac Updates 2018 Loan Product Advisor 9
Slide 10: Single-Family Week in Review
Single-Family Week in Review Loan Product Advisor 10
Slide 11: Bulletin 2018-23
Bulletin 2018-23 Selling Updates Single-Family Seller/Servicer Guide (Guide) Bulletin 2018-23 introduces automated income and asset assessment with Loan Product Advisor®, which are effective for submissions and resubmissions on and after December 9, 2018. See Freddie Mac Single-Family Seller/S
Slide 12: 2019 Loan Limits
2019 Loan Limits Loan Product Advisor 12
Slide 13: Bulletin 2018-21
Bulletin 2018-21 Selling Updates Single-Family Seller/Servicer Guide (Guide) Bulletin 2018-21 introduces GreenCHOICE MortgageSM , an option to finance energy and/or water efficiency improvements. – GreenCHOICE Mortgages expand current underwriting flexibilities for mortgages secured by energ
Slide 14: Enhancements
Enhancements Loan Product Advisor 14
Slide 15: Bulletin 2018-19
Bulletin 2018-19 Selling Updates Rental income requirements Documentation requirements for Social Security retirement and disability benefits Special loan-to-value/total LTV/Home Equity Line of Credit ratio requirements for a “no cash-out” refinance of a mortgage owned or securitized by Fr
Slide 16: Bulletin 2018-18
Bulletin 2018-18 Selling Updates Updates to the Loan Collateral Advisor® score structure, feedback messages and eligibility for representation and warranty relief for property value only. Updates to condominium projects requirements and flexibilities for condominium project reviews. Freddi
Slide 17: Bulletin 2018-16
Bulletin 2018-16 Selling Updates Selling and servicing requirements for our Community Land Trust mortgage offering Updated requirements for mortgages secured by properties subject to resale restrictions Additional flexibility in the use of sweat equity as a source of down payment for Home
Slide 18: Bulletin 2018-15
Bulletin 2018-15 Selling Updates Updates requirements for authorized user accounts. Sellers will only be required to meet additional requirements if the Feedback Certificate contains a feedback message instructing them to do so. Revises requirements for super conforming mortgages. Al
Slide 19: Bulletin 2018-13
Bulletin 2018-13 Selling Updates Combines Home Possible® and Home Possible Advantage® offerings into one consolidated offering and expands certain requirements. Updates mortgage eligibility and credit underwriting requirements related to: – Payment calculation requirements for student lo
Slide 20: Bulletin 2018-12
Bulletin 2018-12 Selling Updates – Lender Credits • Cannot exceed the borrower’s closing costs • When they do, Sellers can now apply excess as a principal curtailment towards the mortgage as opposed to re-disclosure and delaying the closing. – Streamlining policies for Leasehold estates – Contin
Slide 21: Bulletin 2018-10
Bulletin 2018-10 Selling Updates – Updates to Automated Collateral Evaluation (ACE) • Allows for Condos • Must receive Accept/Eligible if run in Loan Product Advisor – Increasing number of financed properties to 10 when subject is a second home or investment. When 7-10 range loan must have: • 72
Slide 22: Bulletin 2018-10
Bulletin 2018-10 Selling Updates – Appraisal Updates to Comp Selection • For subdivisions, PUDS, Condos, appraisers may use ALL comps from outside the project when no contracts or closed comps are available • Appraisers must comment, justify and support the use of selected comps • Comps older th
Slide 23: Bulletin 2018-08
Bulletin 2018-08 Reminders – Income – Credit Inquiry Loan Product Advisor 23
Slide 24: Bulletin 2018-07
Bulletin 2018-07 Selling Updates – Introducing HomeOne Mortgage SM • 97% First time homebuyer option – Updates to HomePossible • Income limit changes • Removes the disaster area and high cost area – See Home Possible® training for full details Loan Product Advisor 24
Slide 25: Bulletin 2018-06
Bulletin 2018-06 Single-Family Seller/Servicer Guide – Specific guidance regarding cancelation of borrower-paid mortgage insurance • Allows for written or verbal request • Examples of substantial improvements to cancel MI • Current value requests, servicers must obtain a new BPO through BPOdirec
Slide 26: Bulletin 2018-05
Bulletin 2018-05 Single-Family Seller/Servicer Guide – Increases maximum LTV/TLTV/HTLTV ratio for purchase and “no cash-out” refinance mortgages for second homes and 2-unit primary residences – No project eligibility review for a Freddie Mac owned no cash-out refi • Max LTV/LTV/HTLTV is 80% – Al
Slide 27: Bulletin 2018-03
Bulletin 2018-03 Single-Family Seller/Servicer Guide – Updates related to Eligible Disaster Areas • Loan Product Advisor updated to remove areas impacted by disaster and only offers ACE (Automated Collateral Evaluation) where eligible – Retirement of condo unit credit fee in price for detached c
Slide 28: Loan Product Advisor Documentation Matrix
Loan Product Advisor Documentation Matrix Tool to help document files http://www.freddiemac.com/learn/pdfs/uw/docmatrix.pdf Loan Product Advisor 28
Slide 29: Freddie Mac Rental Income Matrix
Freddie Mac Rental Income Matrix Tool to help document files http://www.freddiemac.com/learn/pdfs/uw/rental.pdf Loan Product Advisor 29
Slide 30: Loan Product Advisor – May 27, 2017
Loan Product Advisor – May 27, 2017 ALL Borrowers WITHOUT a Credit Score – At least one housing payment reference must be verified – One additional payment history for each borrower – Each reference must have existed for most recent 12 months – Homeownership education is required for at least on
Slide 31: Loan Product Advisor – June 26, 2017
Loan Product Advisor – June 26, 2017 NOT All Borrowers Have A Useable Credit Score – At least borrower must have a usable credit score as determined by Loan Product Advisor – Purchase or “no cash-out” refinance – One unit Primary home with all borrowers occupying – If borrower without the usable
Slide 32: Loan Product Advisor
Loan Product Advisor Loan Product Advisor Returns a “Response File”: – Documentation Checklist: Used to help you process/document your file – Credit report: Loan Product Advisor allows for several options for credit reports. In-file credit reports or Tri-Merged credit reports (If you opted to or
Slide 33: Loan Product Advisor ...The Process Continued
Loan Product Advisor...The Process Continued – For validation, you may use in-file credit reports pulled either inside or outside Loan Product Advisor. (In-file credit reports are the default in Loan Product Advisor) Three must be requested for each borrower. – You may select to order a tri-merged c
Slide 34: Loan Product Advisor Feedback Certificate
Loan Product Advisor Feedback Certificate Let’s Review The Feedback Certificate Handout That Was Provided Loan Product Advisor 34
Slide 35: Freddie Mac Purchase Eligibility
Freddie Mac Purchase Eligibility • Review the Feedback Certificate for Purchase Eligibility Messages – Freddie Mac Eligible – Freddie Mac Ineligible (Not eligible for sale to Freddie Mac/Investor) – Freddie Mac 500 A-minus Offering Many Lenders Do NOT Allow For A-Minus Loans To Be Delivered Or Insur
Slide 36: Loan Product Advisor “Risk Class”
Loan Product Advisor “Risk Class” Risk Classes for: •Conventional / Conforming Loans – ACCEPT – CAUTION Loan Product Advisor 36
Slide 37: Loan Data and Documentation Level
Loan Data and Documentation Level Loan Data Fields – Borrower name – Appraisal Identifier, AUS Key #, Application # – Property Address and Mortgage Type Documentation Levels for Conventional Conforming Loans – Streamlined Accept (Generally the Rule of One…). – Standard (Generally the Rule of Two) Bu
Slide 38: Results and Credit Report Information
Results and Credit Report Information Loan Product Advisor 38
Slide 39: Validate Mortgage Information
Validate Mortgage Information Loan Product Advisor 39
Slide 40: Easy To Read Funds To Verify
Easy To Read Funds To Verify Loan Product Advisor 40
Slide 41: Additional Amounts on Top of Loan Product Advisor Feedback
Additional Amounts on Top of Loan Product Advisor Feedback Updates Made for Additional Properties Owned! Loan Product Advisor 41
Slide 42: Income And Ratio Information
Income And Ratio Information Validate Liabilities From Your LOS To Loan Product Advisor; Do Ratios Match? What Liabilities Must Be Included? Loan Product Advisor 42
Slide 43: Number of Submissions
Number of Submissions You Must Always Validate/Underwrite To The Most Recent Loan Product Advisor Submission Loan Product Advisor 43
Slide 44: Feedback Summary - # of Messages
Feedback Summary - # of Messages Let’s Start With The Employment And Income Messages Loan Product Advisor 44
Slide 45: Income/Employment Messages
Income/Employment Messages • Documentation “Level” determines the documentation required – Note: Many messages say “if”, so they apply only “if”…. Loan Product Advisor 45
Slide 46: Asset and Reserves
Asset and Reserves • Read All Messages Loan Product Advisor 46
Slide 47: Credit and Liabilities Messages
Credit and Liabilities Messages Read!! Guidance when no payment is listed or liability is not on the credit report; option to verify funds to pay off open ended accounts; Loan Product Advisor 47
Slide 48: Property and Appraisal
Property and Appraisal Loan Product Advisor 48
Slide 49: General Messages
General Messages Loan Product Advisor 49
Slide 50: The Checklist - Use It!!
The Checklist - Use It!! Loan Product Advisor 50
Slide 51: Documentation Matrix
Documentation Matrix – Updated September 2018 – Assists with processing and documenting Loan File – Can help with scenarios before submission to Loan Product Advisor – Note the reference to the Guide – Broken out by topic – Credit and Liabilities – Income – Assets – Property – Broken out by Document
Slide 52: What if the Credit Report has an Inquiry?
What if the Credit Report has an Inquiry? What do I do? NEW Pages 22 and 23 of matrix http://www.freddiemac.com/learn/pdfs/uw/docmatrix.pdf Loan Product Advisor 52
Slide 53: What Debts Must be Included in the DTI?
What Debts Must be Included in the DTI? Pages 23 and 24 of Matrix http://www.freddiemac.com/learn/pdfs/uw/docmatrix.pdf Loan Product Advisor 53
Slide 54: Treatment of Student Loans in DTI
Treatment of Student Loans in DTI NEW Page 24 of Matrix http://www.freddiemac.com/learn/pdfs/uw/docmatrix.pdf Loan Product Advisor 54
Slide 55: Excluding Contingent Liabilities From DTI
Excluding Contingent Liabilities From DTI Page 25 of Matrix http://www.freddiemac.com/learn/pdfs/uw/docmatrix.pdf Loan Product Advisor 55
Slide 56: Refer to the Guide for More Information on Monthly Income
Refer to the Guide for More Information on Monthly Income Page 3 of matrix http://www.freddiemac.com/learn/pdfs/uw/docmatrix.pdf Loan Product Advisor 56
Slide 57: Self-Employment
Self-Employment Page 12 and 13 of matrix Loan Product Advisor 57
Slide 58: Self-Employment
Self-Employment NEW Page 13 of matrix Loan Product Advisor 58
Slide 59: What is a Large Deposit and What Do I Do?
What is a Large Deposit and What Do I Do? Page 17 & 18 Loan Product Advisor 59
Slide 60: Freddie Mac Required Reserves
Freddie Mac Required Reserves Loan Product Advisor 61
Slide 61: Freddie Mac Required Reserves
Freddie Mac Required Reserves Loan Product Advisor 62
Slide 62: Property Eligibility Requirements
Property Eligibility Requirements Page 27and 28 of matrix http://www.freddiemac.com/learn/pdfs/uw/docmatrix.pdf Loan Product Advisor 63
Slide 63: Loan Collateral Advisor®
Loan Collateral Advisor® Loan Product Advisor 64
Slide 64: Loan Collateral Advisor®
Loan Collateral Advisor® Loan Product Advisor 65
Slide 65: Loan Collateral Advisor®
Loan Collateral Advisor® Loan Product Advisor 66
Slide 66: Loan Product Advisor Enhanced Underwriting Workflow
Enhanced Underwriting Workflow Loan Product Advisor® — the cornerstone of Freddie Mac Loan Advisor Suite® — gives you Freddie Moc a MeNy sume Senm ome access to Freddie Mac credit requirements and XN «°° sk S0 you cameos a80008 your loan’s overall underwriting risk. It's our next Feedback Message Su
Slide 67: Automated Collateral Evaluation (ACE)
Automated Collateral Evaluation (ACE) Loan Product Advisor 68
Slide 68: FAQ’s
FAQ’s http://www.freddiemac.com/loanadvisorsuite/faq/loanproductadvisor.html Loan Product Advisor 69
Slide 69: HVE FAQ’s
HVE FAQ’s http://www.freddiemac.com/hve/faq.html Loan Product Advisor 72
Slide 70: Read ALL Messages and Validate; Resubmit if Necessary
Read ALL Messages and Validate; Resubmit if Necessary Loan Product Advisor 76
Slide 71: Common Errors
Common Errors Double Check Your Data – Address information wrong – Property Type entered incorrectly (condo, but entered as single family) – HOA, Condo or PUD dues not included in DTI – Liabilities omitted without supporting documentation – Inquires not cleared as either a new account opened or
Slide 72: Always Remember
Always Remember A Few Reminders: – Use FULL vested value of the borrower’s 401k, IRA, KEOGH, 403b or other IRS qualified plan as reserves IF borrower has access to the funds currently without restriction; Ensure loans taken are subtracted from the value of the asset account and that applicant is
Slide 73: Always Remember
Always Remember A Few Reminders: – If a revolving debt, open-ended accounts or deferred non-student loan do not show a payment on the credit report, you are required to use 5% of the balance, or obtain a copy of a statement evidencing lower payment. – For open-ended debt (AmEx O type accounts),
Slide 74: Genworth Underwriting Guidelines
Genworth Underwriting Guidelines Loan Product Advisor 80
Slide 75: Genworth Rate Express®
Genworth Rate Express® Loan Product Advisor 81
Slide 76: LOS Connections
LOS Connections Loan Product Advisor 82
Slide 77: Training Tools and Information
Training Tools and Information Loan Product Advisor 83
Slide 78: Training Tools and Information
Training Tools and Information Loan Product Advisor 84
Slide 79: Additional MI Site Information
Additional MI Site Information Loan Product Advisor 85
Slide 80: Your Genworth Resources
Your Genworth Resources ActionCenter®: 800 444.5664 Your Local Genworth Regional Underwriter Your Genworth Sales Representative Loan Product Advisor 86
Slide 81: Legal Disclaimer
Legal Disclaimer Genworth 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 train
Slide 82: Previous Freddie Mac Updates
Previous Freddie Mac Updates 2017 Loan Product Advisor 88
Slide 83: Updates For Freddie Mac 2017-12
Updates For Freddie Mac 2017-12 Effective for loans with settlement dates on or after March 1, 2019; Sellers may implement immediately – Short-term and long-term rental income sources for refinance transactions – Updates policy for rental properties NOT owned in the prior calendar year – Reintro
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