Written By: Stacey Sprain
If you’re like me, you can’t wait to be done with September and into October so that we can implement all of the major changes we’ve known have been coming for quite some time. In case you’ve forgotten or misplaced your list, here are some reminders:
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• October 1- Temporary High Balance Loan Limits are replaced by permanent high balance loan limits
Refer to Fannie Mae 8/15/2011 Announcement, Freddie Mac 7/18/2011 Announcement, FHA Mortgagee Letter 11-29, VA 2011 Loan Limits
• October 1- USDA Guarantee Fee Changes for Purchases and an Annual Fee is added for Purchases and Refinances
o Purchase loans that receive RD commitment on and after 10/01/2011 are subject to RD Guarantee Fee of 2.0% and annual fee of 0.3% of the unpaid principal balance. Refer to RD AN-4551 issued 02/03/2011 for full details
o Refinance loans that receive RD commitment on and after 10/01/2011 are subject to RD Guarantee Fee of 1.0% and annual fee of 0.3% of the unpaid principal balance. Refer to RD AN-4551 issued 02/03/2011 for full details
• October 1- Beginning October 1, 2011 (FY 2012), all requests for Guarantees must be on the new Form RD 1980-21, “Request for Single Family Housing Loan Guarantee” with the 10/2011 revision date. If the Agency receives a Form RD 1980-21, “Request for Single Family Housing Loan Guarantee” from a lender on the old version of the form, the lender will be required to submit a new Form RD 1980-21, “Request for Single Family Housing Loan Guarantee” with the 10/2011 revision date. This new version has the required Annual Fee disclosures incorporated in the form.
• October 1- On October 1, 2011, the Single Family Housing Guaranteed Loan Program will update the Guaranteed Underwriting System (GUS) to accommodate the new annual fee structure for fiscal year 2012 (FY 2012). A conversion process is required for all applications in a “Final Submission” status, that have not been processed, obligated, and a Conditional Commitment issued to the lender by the Agency on or before September 30, 2011. All applications in GUS in a “Final Submission” status, that not been processed and guarantee funds obligated by the Agency, will be withdrawn and released back to the lender in GUS.
Need FHA Training? CLICK HERE: http://www.FHA-Classes.org
Lenders wishing to continue with a GUS application that has been released back to them, will need open the application in GUS and update certain data elements. Specifically, on the “Loan Terms” application page in the “Type of Mortgage and Terms of Loan” section, the “Upfront Guarantee Fee /Annual Fee Option” will need to be selected. On the “Transaction Details” application page, item” n”,” Funding Fee, Guarantee Fee financed” amount may need to be modified. The lender will also need to check other edits/errors in GUS which may be a result of the fee change.
• October 1- VA Funding Fees Change for most VA Home Loan Transactions-See Circular 26-11-12
The new funding fee structure applies for VA loans that have not yet closed on and after 10/01/2012.
Purchases
Regular Military First-time Use of Entitlement Subsequent Use of Entitlement
0-4.99% Down payment 1.40% Funding Fee 2.80% Funding Fee thru 10/01/2012
5-9.99% Down payment .750% Funding Fee .750% Funding Fee
10% or more Down payment .500% Funding Fee .500% Funding Fee
Reservist/National Guard First-time Use of Entitlement Subsequent Use of Entitlement
0-4.99% 1.65% Funding Fee 2.80% Funding Fee thru 10/01/2012
5-9.99% 1.00% Funding Fee 1.00% Funding Fee
10% or more .750% Funding Fee .750% Funding Fee
Need FHA Training? CLICK HERE: http://www.FHA-Classes.org
Cash-Out Refinances
Regular Military First-time Use of Entitlement Subsequent Use of Entitlement
Regardless of Down payment 1.40% Funding Fee 2.80% Funding Fee thru 10/01/2012
Reservist/National Guard First-time Use of Entitlement Subsequent Use of Entitlement
Regardless of Down payment 1.65% Funding Fee 2.80% Funding Fee thru 10/01/2012
IRRRL
Regular Military
Reservist/National Guard .500% Funding Fee .50% Regardless of usage or veteran status
Regardless of Down payment
Hope these reminders help you to keep it all straight as we move into October and finally move forth with all of the changes we’ve known were coming for quite some time!
About The Author
Stacey Sprain - As an NAMP® staff writer, Ms. Stacey Sprain is currently a NAMP® member in good standing, and is a NAMP® Certified Ambassador Loan Processor (NAMP®-CALP). With over 15+ years of mortgage banking experience, Stacey is also a Quality Control Manager for a major mortgage lending institution. If you would like to become a volunteer writer for us, please email us at: contact@mortgageprocessor.org.
