MPF Xtra Selling Guide Updates
Date: Immediately (unless otherwise noted)
Fannie Mae recently issued Selling Guide Announcement SEL-2021-05 and added updates and clarifications to Lender Letter LL-2021-10 which was previously published and provided details about RefiNow; a new refinance option being offered by Fannie Mae.
Selling Guide Announcement SEL-2021-05
The below referenced topics from Selling Guide Announcement SEL-2021-05 are applicable to loans sold under the MPF Xtra product:
- Added a new topic on notarization standards along with specific requirements for remote ink-signed notarization (RIN).
- Clarification of correction and modification policy regarding loans with technical or typographical corrections are not considered to be modified loans.
RefiNow - Lender Letter LL-2021-10
As previously announced in MPF Announcement 2021-40, the MPF Program will accept delivery of RefiNow loans that meet the Fannie Mae requirements outlined in Lender Letter LL-2021-10 and the Fannie Mae Guides under MPF Xtra.
Lender Letter LL-2021-10was recently updated to reflect additional clarifications to the requirements for RefiNow loans, including:
- Allowing existing subordinate financing to be simultaneously refinanced as part of a RefiNow transaction, provided certain requirements are met.
- Permiting borrowers who have resolved missed payments due to a COVID-19 forbearance in accordance with the temporary eligibility requirements for purchases and refinances in LL-2021-03 to be eligible for a new RefiNow transaction.
- Clarifying the paystub requirements to align with current policy.
In order for RefiNow to be delivered into the MPF Program, PFIs will need to follow the additional guidelines and operation details provided below:
- Please note that the MPF Program has opted to place a Desktop Underwriter (DU®) requirement on all MPF Xtra RefiNow deliveries. Although FNMA’s guidelines allow for the use of manual underwriting, the MPF program will require a Desktop Underwriter (DU®) Approve/Eligible AUS recommendation for all RefiNow loans sold into MPF Xtra.
- All RefiNow loans must be delivered with a Special Feature Code of 868 in the ULDD XMl file.
- Should the loan not be eligible for an appraisal waiver, the appraisal cost credit intended to be given back to the borrower will appear in the “Investor Fees” field of the “Transaction Confirmation and Loan Funding Activity Report” sent at the time of loan funding. Please expect this credit to be added back to the Investor Fees (also known as Loan Level Price Adjustments) that may have been assessed to the loan funding.
- Standard Delivery Commitments (Fixed 30 Yr, Fixed 15, etc.) as well as Low Loan Balance Subproducts (Fixed 30 Yr 200K Max Ln Amt for example) can be utilized for the RefiNow product. Please note that 10 Yr Delivery commitments are available, but will require calling into the MPF Service Center to execute.
- At this time, loans with a total debt-to-income ratios greater than 50% will require assistance by calling the MPF Service Center.
- In an effort to help inform users of potential eligibility concerns and uphold data integrity, rules have been implemented and, if triggered, will display on the “Batch Errors Report” that is retrievable within the eMPF website. For questions on those errors, please contact the MPF Service Center for assistance.
Other topics mentioned in the Fannie Mae announcement do not apply to MPF Xtra. To gain a full understanding of these topics, PFIs should review the entire Fannie Mae Announcement and any applicable Fannie Mae Selling Guide chapters, forms, or exhibits noted in the announcements.
- MPF Announcement 2021-51