Q&A - January 25, 2018

Fannie Mae – Commission Income – Casino Dealer: Can we use commission income for a casino dealer which is more than 25% of a client’s income and less than 24 months?

Answer: Fannie Mae provides a path to using less than 24 months for commission income (see highlighted text below). Reference: B3-3.1-04, Commission Income (06/30/2015) Introduction This topic contains information on the verification of commission income. Verification of Commission Income The following table provides verification requirements for commission income: ✓ Verification of Commission Income A minimum [...]

2018-06-01T13:10:36-05:00January 24th, 2018|

FHA – Flood Insurance: Does FHA allow the use of private flood insurance?

Answer: FHA requires coverage under the NFIP/FEMA.  They don’t offer the option of private insurance coverage.  See the full guideline below. Reference: (A) General Property Eligibility: The Property must be located within the U.S., Puerto Rico, Guam, the Virgin Islands, the Commonwealth of the Northern Mariana Islands, or American Samoa. (1) Special Flood Hazard Areas: The Mortgagee must determine if [...]

2018-06-01T13:11:12-05:00January 24th, 2018|

Compliance – Automated Appraiser Assignment: If we have an automated appraiser assignment (on rotation) through our LOS, can an LO place the order for an appraisal?

Answer: An LO can never ‘order’ the appraisal, even if the system is automated and the LO has no contact with the appraiser.  This breaks down to a technicality and ultimately it would be the responsibility of the lender to make sure appraisal independence requirements are being met.  What makes it technical is the concept [...]

2018-06-01T13:11:52-05:00January 24th, 2018|

VA-Income Based Repayment [IBR]: How do I calculate an IBR student loan payment for a VA loan? [Chart – Student Loan Repayment Rules – All Agencies]

Updated Chart on 5/9/2018 – Student Loan Chart/Checklist- FHA/VA/USDA/Conventional Comparison Answer: VA has no prohibition in the Lenders Handbook regarding the use of IBR payments, and my conversations with my VA Regional Office have confirmed this.  So IBR payments can be used to calculate DTI on a VA loan.  (See the VA Student Loan guideline [...]

2018-06-01T13:12:32-05:00January 24th, 2018|