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pdm
306 Posts |
 Posted - 04/08/2008 : 07:07:01 AM
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FYI
New DU Version and Related Eligibility and Pricing Changes
Fannie Mae continues to make changes as necessary to support our lenders and their broker partners by fulfilling our mission to provide liquidity, stability, and affordability to the mortgage finance system. The dramatic shifts in the market over the past few months have prompted us to review our eligibility requirements, automated underwriting risk assessment, and pricing.
It is important that the underwriting and eligibility criteria foster sustainable homeownership for the borrower while establishing sustainable economics for Fannie Mae.
Below is a summary of the changes.
DU Version 7.0
The Desktop Underwriter® (DU®) version that will be released during the weekend of May 31, 2008, will support the policy changes described in Announcement 08-08 and several other changes.
Below are some of the changes customers should expect to see with DU Version 7.0:
All DU recommendation levels will reflect improved credit quality, especially for Expanded Approval® (EA) recommendations.
Some loan casefiles will receive more conservative recommendations, while others may receive improved recommendations when compared to loan casefiles submitted to DU Version 5.7.
Reduced Approve and/or EA recommendation rates, although the overall impact will vary depending on the mix the customer submits to DU.
For details, please refer to the Release Notes.
Eligibility and Pricing Changes
Announcement 08-08, Mortgage Eligibility and Pricing Updates for Desktop Underwriter and Manually Underwritten Loans, outlines a number of changes that generally are effective June 1, 2008, including:
Introduction of a 580 minimum credit score for loans underwritten through DU or manually underwritten (except insured government loans, nontraditional credit loans, and certain Fannie Mae to Fannie Mae Streamlined Refinances)
Reduced maximum LTV/CLTV ratios and new minimum credit scores for certain manually underwritten transactions
Reduced maximum HCLTV for all manually underwritten loans
Retirement of the Streamlined Purchase Money Mortgage and the Timely Payment Rewards® feature of EA
Changes to MyCommunityMortgage® (MCM®) eligibility and credit score requirements; including a maximum 97% LTV for manually underwritten MCM loans
Policy changes regarding borrowers with prior foreclosures and recent mortgage delinquencies
A policy change regarding authorized users of credit
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clarenceworley
4358 Posts |
Posted - 04/08/2008 : 07:24:37 AM
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| Well, there goes sneaking one through with a good ltv, reserves, good dti and a lousy score. |
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FLProcessor
442 Posts |
Posted - 05/12/2008 : 11:42:49 PM
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Keep in mind, the 580 fringe issue is the least of the problems that will be created by the FNMA 08-08 announcement.
And... DU 7.0 is not going to be pretty! |
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