GSEs Announce Updates to Loan Repurchase Guidelines for Lenders

first_img Demand Propels Home Prices Upward 2 days ago  Print This Post Related Articles At the direction of the Federal Housing Finance Agency (FHFA), both Fannie Mae and Freddie Mac announced on Thursday updates to their life-of-loan representation and warranty framework in order to provide clarity for lenders regarding the potential risk for repurchase.The clarification of life-of-loan exclusions announced by the GSEs are meant to provide more certainty to lenders and borrowers alike, which will “increase access to credit without compromising safety and soundness,” according to a prepared statement by FHFA Director Mel Watt.”The release of details today by Fannie Mae and Freddie Mac clarifying the definition of life-of-loan exclusions and when they apply is a positive step forward for housing finance,” Watt said in his statement. “Concerns about when a mortgage loan might be subject to repurchase, along with other market factors, have contributed to increased credit overlays that drive up lending costs and reduce access to credit.”For Fannie Mae, the new framework guidelines provide specific requirements under which lenders can seek a repurchase after they are granted relief. One particular clarification made in Thursday’s updates relates to misrepresentations or data inaccuracies around the loan that surface post-relief date – Fannie Mae will seek repurchase on these loans only after is that Fannie Mae will seek repurchase of a loan after administering a “significance test” to determine if Fannie Mae would not have purchased the loan in the first place had the misrepresentations or inaccuracies been known prior to the relief date.Currently, lenders are granted relief on many representations if one of three requirements is met: The borrower makes timely payments on most loans for 36 months, the borrower makes timely payments on Home Affordable Refinance Program (HARP) or Refi Plus loans for 12 months, or if the loan passes a quality control review administered by Fannie Mae.Fannie Mae also announced it will seek repurchase on a loan either before or after relief is obtained under the framework if “it determines the failure to comply would impair its rights under the note or mortgage or result in direct liability by Fannie Mae under the law, or if the lender may have violated a consumer protection or other law or regulation that is specifically listed in today’s announcement.””The clarity and certainty we’re providing today is crucial for lenders to increase access to mortgage credit,” said Andrew Bon Salle, EVP of Single-Family Underwriting, Pricing, and Capital Markets for Fannie Mae. “There are qualified borrowers who are not being served in today’s market. With this clarity, lenders should have greater confidence in lending to Fannie Mae’s full credit standards and making mortgages available to more borrowers.”Freddie Mac announced that it will implement a similar significance test to the one Fannie Mae will administer in order protect the enterprise against fraud, misrepresentations, or data inaccuracies in regards to a loan. Freddie Mac also announced that the updates will be retroactive to mortgages that settled with the enterprise on or after January 1, 2013. In addition, Freddie Mac will be updating the “compliance with law” definition in its Selling Guide in order to “provide more certainty on how Freddie Mac will enforce remedies for compliance with laws,” according to Thursday’s announcement.”Today’s announcement goes a long way in providing clarity and certainty to lenders as to when a loan will be subject to a repurchase,” said Dave Lowman, EVP of Single Family Business at Freddie Mac. “Lenders have been specifically concerned that the life of loan exclusions could undermine the selling representation and warranty relief, leaving a back door for the GSE to put loans back to them after granting relief. Addressing these concerns by providing tighter definitions and clarity should encourage Sellers to serve a broader range of qualified borrowers.” November 20, 2014 1,266 Views Servicers Navigate the Post-Pandemic World 2 days ago Brian Honea’s writing and editing career spans nearly two decades across many forms of media. He served as sports editor for two suburban newspaper chains in the DFW area and has freelanced for such publications as the Yahoo! Contributor Network, Dallas Home Improvement magazine, and the Dallas Morning News. He has written four non-fiction sports books, the latest of which, The Life of Coach Chuck Curtis, was published by the TCU Press in December 2014. A lifelong Texan, Brian received his master’s degree from Amberton University in Garland. Demand Propels Home Prices Upward 2 days ago Tagged with: Fannie Mae Freddie Mac Life-of-Loan Exclusions Loan Repurchase Guidelines Governmental Measures Target Expanded Access to Affordable Housing 2 days ago About Author: Brian Honea Fannie Mae Freddie Mac Life-of-Loan Exclusions Loan Repurchase Guidelines 2014-11-20 Brian Honea The Best Markets For Residential Property Investors 2 days ago in Daily Dose, Featured, Government, Newscenter_img Servicers Navigate the Post-Pandemic World 2 days ago Home / Daily Dose / GSEs Announce Updates to Loan Repurchase Guidelines for Lenders Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Data Provider Black Knight to Acquire Top of Mind 2 days ago Data Provider Black Knight to Acquire Top of Mind 2 days ago Previous: CFPB Proposes to Expand Foreclosure Protections Next: Fannie Mae Expects Modest Economic Growth in 2015 The Week Ahead: Nearing the Forbearance Exit 2 days ago The Best Markets For Residential Property Investors 2 days ago GSEs Announce Updates to Loan Repurchase Guidelines for Lenders Share Save Sign up for DS News Daily Subscribelast_img read more

Examine your fears to help you focus

first_imgWith Halloween coming up, it’s a great time to ask yourself, “What am I most afraid of when it comes to my credit union and the industry as a whole?” Your short list of answers can be a guide to what your top priorities really are.Because CUES staffers talk every day with our members and others in credit union land, CUES has deep insights into the things that keep CU leaders up at night—things like payments, risk management, and keeping and developing top talent.And as a talent development organization, CUES responds to these fears by offering learning experiences to help credit union leaders effectively address their top concerns. For example we are currently working with CUES Supplier member CO-OP Financial Services, Rancho Cucamonga, Calif., to offer the new Payments University next April. We have partnered with the highly knowledgeable CUES Supplier member Cornerstone Advisors, Scottsdale, Ariz., to bring credit unions enterprise risk management services. And our CUES Executive Compensation Survey and CUES Employee Salary Survey help subscribers know if they’re paying enough to keep and motivate the best people.While addressing specific fears with learning is important, CUES also excels at helping credit union leaders manage complexity. This means we offer programs that teach strategic tools to help leaders like you systematically sort through the sometimes overwhelming volume of news about payments, ERM, human resources and everything else. We know our attendees who attend and learn how to use these tools are well equipped to position their credit unions for success in the marketplace.Key CUES programs, including CUES’ flagship CEO Institute, the already-mentioned Payments University, Mergers & Acquisitions Institute (now in its second year) and Strategic Innovation Institute, teach top-level and time-tested tools for analysis, critical thinking and decision-making. The tools attendees of these programs take home can help them feel less afraid because they know they’ll be making solid decisions about how to handle the challenges they face.So, as the kids in your life dress up and go out to be scared this Halloween, be sure to ask yourself the question that led off this article: “What am I most afraid of when it comes to my credit union and the industry as a whole?” Take your short list of answers and seek reliable tools to help you best manage them. 36SHARESShareShareSharePrintMailGooglePinterestDiggRedditStumbleuponDeliciousBufferTumblr,John Pembroke Since joining CUES in March 2013, John Pembroke has played a leadership role in developing and launching a new direction in CUES’ strategy, branding and culture. Under his guidance, CUES … Web: www.cues.org Detailslast_img read more