Issue: Q&A - April 25, 2018

Fannie-Freddie-FHA-VA-Payroll Debit Cards: Will Fannie Mae accept income that is deposited to a debit card by an employer?

Answer: Our expert sent this email to Fannie Mae based on your question: Scenario:  We have had several questions from borrowers who have employers that utilize debit cards to deposit the employee payroll.  We have a borrower now that uses an Emerald Card with H&R Block for her direct deposit.  She gets her tax refunds […]

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FHA – Non-Occupying Borrower – 2-Unit: What is the maximum LTV for an FHA loan if I use a non-occupying co-borrower?

Answer: The answer is that it depends!  See the guideline below to determine if your borrower can use the maximum LTV of 96.5% or 75%. Reference: 4000.1, II, A, 2, b, ii (B)LTV Limitations Based on Non-Occupying Borrower Status (1) Definition: A Non-Occupying Borrower Transaction refers to a transaction involving two or more Borrowers in which one or more of […]

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FHA Boarder Income: Does FHA allow boarder income?

 Answer: To claim boarder income the borrower needs to show this income on their Schedule E as per the guidelines below.  Be sure to use the averages as indicated. Reference: 4000.1, II, a, 4, c, xii, (I) (4) Boarders of the Subject Property (TOTAL) (a) Definition: Boarder refers to an individual renting space inside the Borrower’s Dwelling Unit. (b) Standard: […]

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FHA – Gift From Parent Seller: If a client is purchasing a home from their parents, can the parents give them a gift for the down payment? [Chart – FHA Gift Funds – Donors & Documentation]

Answer: The short answer is that the parents can give a gift, either personal or of equity, even when they are the seller. (See second set of guidelines below regarding gifts.) Family members are the exception to the rule stated in 4000.1, II, A, 4, d, ii, (B) that says that a seller cannot be the source […]

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FHA – Multi-Unit – Self Sufficiency Test: How do I determine “self-sufficiency” on a 4-Unit Property?

Answer: To document the self-sufficiency, please see the guidelines below. Reference: 4000.1 II, A, 1, b, iv, (B) (3) Three to Four Unit: A three- to four-unit Property is a Single Family residential Property with three to four individual dwellings. The Mortgagee must obtain a completed form HUD-92561.Self-Sufficiency Rental Income Eligibility (a) Definition: Net Self-Sufficiency Rental Income refers to the Rental Income produced by the subject Property over and above the Principal, […]

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