Enact Holdings, Inc. · NASDAQ:ACT
Enact — Investor Presentation (March 2021)
44 slides from Enact's investor presentation, March 2021
Slide 1: Calculating Rental Income
Calculating Rental Income Fannie Mae And Freddie Mac Guidelines March 2021 Customer Education Brought to you by: Genworth Customer Development and Process Consulting ©2021 Genworth Financial, Inc. All rights reserved. Calculating Rental Income 0
Slide 2: Objectives
Objectives What we will cover: – General guidelines for calculation of rental income for Fannie Mae and Freddie Mac – Recent changes relating to rental properties from Fannie Mae Announcements and Freddie Mac Bulletins – Overview of Freddie Mac Rental Form 92 – Overview of Fannie Mae Rental Forms 10
Slide 3: Training Tools and Information
Training Tools and Information Calculating Rental Income 2
Slide 4: Training Tools and Information
Training Tools and Information Calculating Rental Income 3
Slide 5: Calculator and Quick Reference Guide: Rental Income
Calculating Rental Income Genworth =, =. imorotee hewanee xe Calculator and Quick Reference Guide: Rental Income Please use the following calculator and quick reference guide to assist m calculating rental mcome from IRS Form 1040 Schedule E Depreciation (ine 1a) “Amaruzaton/Canuaity Lasw/Nonrecumng
Slide 6: Rental Income
Rental Income Basics about rental income requirements: – Rental income must be supported by the borrower’s most recent personal tax returns if used for qualification purposes* • Follow the underwrite you are utilizing – Desktop Underwriter® follow the DU findings report – Loan Product Advisor® follo
Slide 7: Freddie Mac Rental Income Guidelines
Freddie Mac Rental Income Guidelines Calculating Rental Income 6
Slide 8: Freddie Mac Rental Income
Freddie Mac Rental Income https://guide.freddiemac.com/ci/okcsFattach/get/1001351_4 https://sf.freddiemac.com/content/_assets/resources/pdf/update/rental.pdf Let’s Review The New Rental Income Matrix And Form 92 Calculating Rental Income 7
Slide 9: Freddie Mac Rental Income
Freddie Mac Rental Income Use Rental Income Matrix Updated July 2020 – Documentation and History – Lease requirements – Properties placed into service in current calendar year – Maximum eligible amount rent – Rental Income calculations – Establishing the DTI – Appraisal Forms – Investment Property M
Slide 10: Freddie Mac Rental Income
Freddie Mac Rental Income https://sf.freddiemac.com/content/_assets/resources/pdf/update/rental.pdf Calculating Rental Income 9
Slide 11: Freddie Mac Rental Income Page 2
Freddie Mac Rental Income Page 2 https://sf.freddiemac.com/content/_assets/resources/pdf/update/rental.pdf Calculating Rental Income 10
Slide 12: Freddie Mac Rental Income Page 3
Freddie Mac Rental Income Page 3 https://sf.freddiemac.com/content/_assets/resources/pdf/update/rental.pdf Calculating Rental Income 11
Slide 13: Freddie Mac Rental Income Page 4
Freddie Mac Rental Income Page 4 https://sf.freddiemac.com/content/_assets/resources/pdf/update/rental.pdf Calculating Rental Income 12
Slide 14: Freddie Mac Rental Income Page 5
Freddie Mac Rental Income Page 5 https://sf.freddiemac.com/content/_assets/resources/pdf/update/rental.pdf Calculating Rental Income 13
Slide 15: Freddie Mac Rental Income Page 6
Freddie Mac Rental Income Page 6 https://sf.freddiemac.com/content/_assets/resources/pdf/update/rental.pdf Calculating Rental Income 14
Slide 16: Freddie Mac Form 92
Freddie Mac Form 92 https://guide.freddiemac.com/ci/okcsFattach/get/1001351_4 Check Out Genworth Website for Calculator Calculating Rental Income 15
Slide 17: Freddie Mac Form 92
Freddie Mac Form 92 Check Out Genworth Website for Calculator Calculating Rental Income 16
Slide 18: Genworth's Freddie Mac Form 92 Calculator
Genworth’s Freddie Mac Form 92 Calculator https://new-content.mortgageinsurance.genworth.com/documents/calculators/12413405.Training.Form92.0221.pdf Calculating Rental Income 17
Slide 19: Freddie Mac Seller/Servicer Guide
Freddie Mac Seller/Servicer Guide https://guide.freddiemac.com/app/guide/content/a_id/1000660 For Complete Rental Income Policy Refer To The Updated Chapter 5306.1 Of The Freddie Mac Seller/Servicer Guide Calculating Rental Income 18
Slide 20: Reserves
Reserves Guide Impacts: 5501.2(b) – Max number of financed properties is 10 when subject is second home or investment property – 720 Credit score required when 7-10 financed properties and loan must be submitted to Loan Product Advisor with Accept/Eligible Recommendation – Loan Product Advisor will
Slide 21: Fannie Mae Rental Income Guidelines
Fannie Mae Rental Income Guidelines Calculating Rental Income 20
Slide 22: Fannie Mae Selling Guide
Fannie Mae Selling Guide https://selling-guide.fanniemae.com/Selling-Guide/Origination-thru-Closing/Subpart-B3-Underwriting- Borrowers/#Documenting.20Rental.20Income.20from.20Subject.20Property *Lenders must meet all Fannie Mae requirements for use of rental income such as history of owning and mana
Slide 23: Calculating Monthly Rental Income or Loss
Calculating Monthly Rental Income or Loss Selling Updates – Also applies to manually underwritten loans https://selling-guide.fanniemae.com/Selling-Guide/Origination-thru-Closing/Subpart-B3-Underwriting-Borrowers/#Documenting.20Rental.20Income.20from.20Subject.20Property Calculating Rental Income 22
Slide 24: Establishment of Property Management Experience
Establishment of Property Management Experience https://selling-guide.fanniemae.com/Selling-Guide/Origination-thru-Closing/Subpart-B3-Underwriting-Borrowers/#Documenting.20Rental.20Income.20from.20Subject.20Property Calculating Rental Income 23
Slide 25: Fannie Mae Selling Guide
Fannie Mae Selling Guide Non-Subject Rental Properties See next slide for exceptions Calculating Rental Income 24
Slide 26: Fannie Mae Selling Guide
Fannie Mae Selling Guide Partial or No Rental History Any Property – Annualize Schedule E or – Fully executed leases Calculating Rental Income 25
Slide 27: Fannie Mae Rental Calculators
Fannie Mae Rental Calculators https://new.mi.genworth.com/self-employed-borrower-calculators Calculating Rental Income 26
Slide 28: Borrowers with Multiple Financed Properties
Borrowers with Multiple Financed Properties DU uses the number of financed properties to apply the following eligibility guidelines: – A minimum credit score of 720 is required for borrowers with 7-10 financed properties – Borrowers are limited to a maximum of 10 financed properties https://selling-
Slide 29: Multiple Financed Properties Fannie Mae
Multiple Financed Properties Fannie Mae https://selling-guide.fanniemae.com/Selling-Guide/Origination-thru-Closing/Subpart-B2-Eligibility/Chapter-B2-2-Borrower- Eligibility/#Limits.20on.20the.20Number.20of.20Financed.20Properties Calculating Rental Income 28
Slide 30: Reserves- Fannie Mae Multiple Financed Properties
Reserves- Fannie Mae Multiple Financed Properties Applies When The Subject Transaction Is A Second Home Or Investment Property AND The Borrower is Personally Obligated On The Financing Calculating Rental Income 29
Slide 31: Reserves- Fannie Mae Multiple Financed Property Examples
Reserves- Fannie Mae Multiple Financed Property Examples Applies When The Subject Transaction Is A Second Home Or Investment Property AND The Borrower is Personally Obligated On The Financing Calculating Rental Income 30
Slide 32: Rental Income-Fannie Mae Amounts
Rental Income-Fannie Mae Amounts* Fannie Mae Requirements 2-4 Unit Primary Residence – Purchase: Gross income is calculated from Form 1025 (small residential properties). – Net rental income is determined by taking the lesser of 75% of the gross rent from form 1025 or 75% of the existing leases. Not
Slide 33: You Need....
You Need…. – 2020 Schedule “E” handout – Rental Income Calculation Form • Impounded/non-impounded are calculated the same • Training today assume an escrowed or impounded loan Calculating Rental Income 32
Slide 34: Schedule E Handout
Schedule E Handout Calculating Rental Income 33
Slide 35: Mortgage Statement/Payment Coupon
Mortgage Statement/Payment Coupon Always ask for one – If loan is impounded or escrowed – What property the mortgage payment is associated with – If non impounded, obtain current tax and insurance information – If condo, PUD or Coop, most investors want verification of current HOA dues Calculating R
Slide 36: Mortgage Statement/Payment Coupon
Mortgage Statement/Payment Coupon Total monthly payment is $3400 PITIA Payment Above Came From Mortgage Statement And HOA Coupon/Statement From Borrower And Is Impounded; For Non-impounded Loans Obtain Tax And Insurance Information Calculating Rental Income 35
Slide 37: Calculating Rental Income
Calculating Rental Income 36
Slide 38: Genworth Underwriting Guidelines
Genworth Underwriting Guidelines Calculating Rental Income 37
Slide 39: Genworth Rate Express
Genworth Rate Express® Calculating Rental Income 38
Slide 40: Training Tools and Information
Training Tools and Information Calculating Rental Income 39
Slide 41: Training Tools and Information
Training Tools and Information Calculating Rental Income 40
Slide 42: Additional MI Site Information
Additional MI Site Information 41 Calculating Rental Income
Slide 43: Your Genworth Resources
Your Genworth Resources ➢ ActionCenter®: 800 444.5664 ➢ Your Local Genworth Regional Underwriter ➢ Your Genworth Sales Representative Calculating Rental Income 42
Slide 44: 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