The Federal National Mortgage Association has made changes to its policies on frozen credit reports, premium pricing and Texas home-equity loans.
When premium pricing is utilized, the lender credit can’t be used towards the borrower’s down payment or reserves and shouldn’t exceed the borrower’s closing costs.
Also, lender credits derived from premium pricing aren’t considered an interested party contribution even when the lender is an interested party to the transaction.
The premium pricing changes are immediately effective.
Fannie Mae covered the updates Tuesday in Selling Guide Announcement SEL-2017-10.
The secondary lender will accept credit reports from borrowers who have a frozen credit file at Equifax, Experian or TransUnion as long as credit data is available from the other two credit repositories.
In addition, a credit score must be obtained from one of the two available credit repositories, and the lender must request a three in-file merged report.
The frozen credit updates apply immediately to manually underwritten files and to loan case files submitted or resubmitted to Desktop Underwriter on or after Nov. 18.
Following the approval by Texas voters last month to amend the state’s constitution for HELs, Fannie is limiting the fee on HELs to 2 percent of the original loan amount.
However, the fee limitation doesn’t include discount points, appraisal costs or survey costs. It also excludes title insurance premiums and title examination report fees.
Fannie said that the list of authorized HEL lenders in Texas is being expanded to include subsidiaries of financial institutions, mortgage bankers and mortgage companies.
One other change is that loans made under the Texas law can now be
refinanced into a regular refinance.
The Texas HEL changes impact loans made on or after Jan. 1, 2018.
