Agency Guideline Revisions Note: Suntrust Mortgage Specific Overlays Are Underlined
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Agency Guideline Revisions Note: SunTrust Mortgage specific overlays are underlined. Impacted Revised Guidelines Topic Impacted Products Current Guidelines Document Effective Immediately for NEW AND EXISTING Loan Applications ON OR After May 26, 2017 Appraisal Correspondent HomeReady® Appraisal Analysis: Agency Loan Programs / Improvements Section of the Appraisal Report Appraisal Analysis: Agency Loan Programs / Improvements Section of the Appraisal Report Requirements Section 1.07 Mortgage / Accessory Appraisal- (non-AUS & Non-AUS Non-AUS Units Guideline DU) Note: Below is an EXCERPT only of the guidance from the above referenced section. All other currently published Note: Below is an EXCERPT only of the guidance from the above referenced section. All other currently published Home guidelines from this section remain the same. guidelines from this section remain the same. Possible® Accessory Units Accessory Units Mortgage Fannie Mae will purchase a one-unit property with an accessory unit. An accessory unit is typically an Fannie Mae will purchase a one-unit property with an accessory unit. An accessory unit is typically an (LPA) additional living area independent of the primary dwelling unit, and includes a fully functioning additional living area independent of the primary dwelling unit, and includes a fully functioning kitchen and bathroom. Some examples may include a living area over a garage and basement units. kitchen and bathroom. Some examples may include a living area over a garage and basement units. Whether a property is defined as a one-unit property with an accessory unit or a two-unit property Whether a property is defined as a one-unit property with an accessory unit or a two-unit property will be based on the characteristics of the property, which may include, but are not limited to, the will be based on the characteristics of the property, which may include, but are not limited to, the existence of separate utilities, a unique postal address, and whether the unit is rented. The appraiser existence of separate utilities, a unique postal address, and whether the unit is rented. The appraiser is required to provide a description of the accessory unit, and analyze any effect it has on the value or is required to provide a description of the accessory unit, and analyze any effect it has on the value or marketability of the subject property. marketability of the subject property. If the property contains an accessory unit, the property is eligible under the following conditions: If the property contains an accessory unit, the property is eligible under the following conditions: The property is defined as a one-unit property. The property is defined as a one-unit property. There is only one accessory unit on the property; multiple accessory units are not permitted. There is only one accessory unit on the property; multiple accessory units are not permitted. The appraisal report demonstrates that the improvements are typical for the market through an The appraisal report demonstrates that the improvements are typical for the market through an analysis of at least one comparable property with the same use. analysis of at least one comparable property with the same use. The borrower qualifies for the mortgage without considering any rental income from the The borrower qualifies for the mortgage without considering any rental income from the accessory unit. accessory unit. If it is determined that the property contains an accessory unit that does not comply with zoning, the property is eligible under the following additional conditions: Reference: See the “Rental Income from a One-Unit Primary Residence with an Accessory Unit” The lender confirms that the existence will not jeopardize any future property insurance claim subtopic within Section 2.01a: Fannie Mae HomeReady® and Freddie Mac Home Possible® that might need to be filed for the property. Mortgages for an exception to this guideline for HomeReady mortgage loans. The use conforms to the subject neighborhood and to the market. The property is appraised based upon its current use. If it is determined that the property contains an accessory unit that does not comply with zoning, the The appraisal must report that the improvements represent a use that does not comply with property is eligible under the following additional conditions: zoning. The lender confirms that the existence will not jeopardize any future property insurance claim The appraisal report must demonstrate that the improvements are typical for the market that might need to be filed for the property. through an analysis of at least three comparable properties that have the same non-compliant The use conforms to the subject neighborhood and to the market. zoning use. The property is appraised based upon its current use. The appraisal must report that the improvements represent a use that does not comply with Fannie Mae DU zoning. Follow DU requirements, which are the same as non-AUS guidelines. The appraisal report must demonstrate that the improvements are typical for the market through an analysis of at least three comparable properties that have the same non-compliant Freddie Mac LPA zoning use. Note: Below is an EXCERPT only of the guidance from the above referenced section. All other currently published guidelines from this section remain the same. Fannie Mae DU Accessory Units Follow DU requirements, which are the same as non-AUS guidelines. A 1-unit detached property may have an incidental accessory unit that is incidental to the overall value and appearance of the subject property. Examples of such properties include a dwelling with a Freddie Mac LPA unit above a detached garage, a dwelling with a guest apartment, or a dwelling with a basement unit. Note: Below is an EXCERPT only of the guidance from the above referenced section. All other currently published The appraiser must describe the accessory unit, and analyze any effect on the value or marketability guidelines from this section remain the same. of the subject property. Accessory Units A 1-unit detached property may have an incidental accessory unit that is incidental to the overall Reference: See “Rental Income From the Subject 1-unit Primary Residence” in the “Rental Income” value and appearance of the subject property. Examples of such properties include a dwelling with a subtopic within Section 2.01 Agency Loan Programs of the Correspondent Seller Guide for additional unit above a detached garage, a dwelling with a guest apartment, or a dwelling with a basement unit. guidance. The appraiser must describe the accessory unit, and analyze any effect on the value or marketability Last Revision Date: 05/26/2017 (Correspondent) Page 1 of 18 Agency Guideline Revisions Note: SunTrust Mortgage specific overlays are underlined. Impacted Revised Guidelines Topic Impacted Products Current Guidelines Document Effective Immediately for NEW AND EXISTING Loan Applications ON OR After May 26, 2017 of the subject property. References: See “Rental Income From the Subject 1-unit Primary Residence” in the “Rental Income” subtopic within Section 2.01 Agency Loan Programs of the Correspondent Seller Guide for additional guidance. See the “Rental Income from a One-Unit Primary Residence with an Accessory Unit” subtopic within Section 2.01a: Fannie Mae HomeReady® and Freddie Mac Home Possible® Mortgages for additional guidance for Home Possible mortgage loans. DU Refi Plus / Correspondent DU Refi Plus™ Overview / Product Summary Overview / Product Summary Ineligible New Section 2.04 Note: Below is an EXCERPT only of the guidance from the above referenced section. All other currently published Note: Below is an EXCERPT only of the guidance from the above referenced section. All other currently published Mortgage DU Refi Plus™ guidelines from this section remain the same. guidelines from this section remain the same. Loan Types Loan Program- Guideline Eligible loan products available under the DU Refi Plus loan program include the following: Eligible loan products available under the DU Refi Plus loan program include the following: Agency Fully Amortizing Fixed Rate, Agency Fully Amortizing Fixed Rate, Agency Fully Amortizing 5/1, 7/1 & 10/1 LIBOR ARMs, Agency Fully Amortizing 5/1, 7/1 & 10/1 LIBOR ARMs, Agency Plus Fully Amortizing Fixed Rate, and Agency Plus Fully Amortizing Fixed Rate, and Agency Plus Fully Amortizing 5/1, 7/1 & 10/1 LIBOR ARMs. Agency Plus Fully Amortizing 5/1, 7/1 & 10/1 LIBOR ARMs. Note: 3/1 LIBOR ARMs and Texas 50(a)(6) transactions are NOT eligible. Note: 3/1 LIBOR ARMs , HomeReady Mortgages, Home Possible Mortgages, and Texas 50(a)(6) loans are NOT eligible. Employer Correspondent Standard Non-AUS Non-AUS Assistance Section 2.01 Agency (non- Forms of Employer Assistance Forms of Employer Assistance Agency Loan AUS, DU & The employer assistance may be in the form of: The employer assistance may be in the form of: Programs- LPA) a grant, a grant, Guideline Agency Plus a direct, fully repayable second mortgage or unsecured loan, a direct, fully repayable second mortgage or unsecured loan, (DU & LPA) a forgivable second mortgage or unsecured loan, or a forgivable second mortgage or unsecured loan, or HomeReady® a deferred-payment second mortgage or unsecured loan. a deferred-payment second mortgage or unsecured loan. Mortgage A borrower of a mortgage loan secured by a primary residence may use funds provided by an A borrower of a mortgage loan secured by a primary residence may use funds provided by an (non-AUS & employer to fund all or part of the down payment or closing costs subject to the minimum borrower employer to fund all or part of the down payment or closing costs subject to the minimum borrower DU) contribution requirements. Employer assistance can also be used for financial reserves for all types of contribution requirements. Employer assistance can also be used for financial reserves for all types of Home assistance with the exception of unsecured loans (which may only be used for the down payment and assistance with the exception of unsecured loans (which may only be used for the down payment and Possible® closing costs).