Announcement 2021-060 - Fannie Mae RefiNow™ Refinance Option

Newrez is pleased to announce the release of Fannie Mae’s RefiNow Option.  RefiNow offers expanded eligibility to benefit low-income borrowers to take advantage of the low interest rate environment.

 

Eligibility

  • Fannie Mae must own the existing mortgage being refinanced
  • Single-family residences
  • Primary residence
  • Borrower’s current income must be less than or equal to 80% of the area median income (AMI) for the subject property
  • Existing loan must be at least 12-months old but not more than 120 months old from the original note date to the new note date
  • Housing payment history for existing mortgage
    • No late payments in the most recent six months; and
    • No more than one late payment in months 7 to 12
  • Maximum 97% LTV/CLTV
  • Debt to income ratio up to 65%
  • Minimum 620 credit score
  • Borrower must receive the following benefits with the refinance
    • Monthly payment must be reduced by at least $50.00
    • Interest rate must be reduced by at least .50%
  • Cash back to the borrower not to exceed $250
  • Financed closing costs, prepaid items, and points not to exceed $5,000
  • A $500 appraisal credit will be provided, at closing, if an appraisal is obtained
  • DU Approve/Eligible required. Manually underwritten loans not permitted
  • DU will evaluate all eligible limited cash-out refinance (LCOR) loans for the RefiNow program and will issue a message that the loan casefile was underwritten according to RefiNow
  • A project review is not required for condo, co-ops, and PUD projects with the following exceptions
    • Confirm that the project is not a condo or co-op hotel, or motel, houseboat, timeshare, or segmented ownership project
    • Confirm the appropriate property and flood insurance
  • Standard Mortgage Insurance coverage is required on all loans with an LTV greater than 80%.
    • Borrower Paid Monthly MI only

 

Resources

Fannie Mae RefiNow product profile located in the Credit Policy & Product Development NewRez Lending Library

RefiNow training is available in the Hive for all Loan Officers and MLCs

Fannie Mae Lender Letter LL-2021-10 Introduction of the RefiNow Option

Desktop Underwriter/Desktop Originator Release Notes DU Version 11.0 June Update