NewRez Announcements 2020-026 and 2020-048 addressed the adoption of flexibilities for conventional conforming loans due to the inability of an appraiser to perform an interior inspection due to COVID-19.
NewRez Announcements 2020-026 and 2020-048 addressed the adoption of flexibilities for conventional conforming loans due to the inability of an appraiser to perform an interior inspection due to COVID-19. This direction was based on Fannie Mae Lender Letter LL-2020-04 and Freddie Mac Bulletin 2020-5.
These temporary flexibilities have been extended for all conventional conforming loans in process and new loans with applications dated on or before July 31, 2020.
Note that these flexibilities do not extend to conventional conforming loans originated in conformance with state Bond or HFA programs.
Exterior-Only Inspection Appraisals on Rate & Term Refinances
As previously announced, an exterior-only inspection appraisal may be obtained in lieu of an interior and exterior inspection appraisal for Rate & Term refinance transactions where the loan being refinanced is owned by Fannie Mae or Freddie Mac.
It is imperative that the eligibility for an exterior-only inspection is identified before the appraisal order is placed.
A full appraisal must be ordered when the original loan is not owned by the same agency.
Examples:
|
Loan being refinanced is owned by: |
New loan’s product is (agency) and scored through (AUS): |
Exterior-only inspection is: |
|
Fannie Mae |
Fannie Mae; DU |
Eligible |
|
Freddie Mac |
Freddie Mac; LPA |
Eligible |
|
Freddie Mac (or another non-agency investor) |
Fannie Mae; DU |
Not eligible |
|
Fannie Mae (or another non-agency investor) |
Freddie Mac; LPA |
Not eligible |
Reminder: Exterior-only inspections are not permitted on cash-out refinances, including Texas 50(a)(6) transactions.
Identification of a Fannie Mae or Freddie Mac Loan
There are two ways to identify if the existing loan is owned by Fannie Mae or Freddie Mac.
AUS Findings
DU and LPA messages are populating when the loan is identified as being owned by the applicable agency. If these messages populate, a NewRez condition will be applied to the loan.
For a loan to be identified as an existing Fannie Mae or Freddie Mac loan, the subject property address, and a Social Security number for at least one of the borrowers must match an existing loan in their portfolio.
|
AUS Messaging |
NewRez Condition |
|
Fannie Mae: Based on the data provided to DU, the borrower's existing loan has been identified by DU as a Fannie Mae loan. |
Based on the data provided to DU, the borrower's existing loan has been identified by DU as a Fannie Mae loan. |
|
Freddie Mac: FMLoan is the Freddie Mac loan number of the loan to be refinanced |
Based on the data provided to LPA, the borrower's existing loan has been identified by LPA as a Freddie Mac loan. |
If the above messaging is not populating on the loan, the second check is to use the loan look-up tools below.
Loan Look-Up Tools
Use the following loan lookup tools to determine if Fannie Mae or Freddie Mac are the current investor of the existing mortgage.
- Fannie Mae Loan Lookup tool
- Freddie Mac Loan Look-Up tool
Next Steps
If the loan is not identified as owned by that agency by either of these two methods, then a full appraisal must be ordered.
For additional information, below are links to Fannie Mae and Freddie Mac Frequently Asked Questions
Remember that NewRez is not adopting all flexibilities in the Fannie Mae and Freddie Mac announcements, therefore some guidelines in their announcements and FAQ may not apply.
Please reference the NewRez Lending Library for the changes outlined in this announcement.