Tag: Q&A Issue

Earnest Money Deposits

Question: How do Fannie and Freddie handle Earnest Money Deposits? Earnest Money Deposit Chart Answers: Freddie Mac – Earnest money deposit (EMD) When an EMD for a purchase transaction is used to qualify the Borrower for the Mortgage transaction, the Seller must obtain evidence that the EMD check cleared the Borrower’s account (e.g., copy of the canceled check, asset account […]

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Divorce Decree – Documenting a Change of Circumstance

Question: A divorce decree states that a borrower is required to pay alimony until ex-spouse is remarried or cohabitates with someone else. The ex-spouse has been cohabitating with someone for 4 years and as such my borrower has not made an alimony payment. How do I document this so that the liability is not counted? […]

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Minimum Distance from Primary Residence to Second Home

Question: Does Fannie Mae have a minimum distance requirement between a primary residence and a second home? Answer: Fannie Mae does not reference a minimum distance requirement. These types of requirements are driven by individual lenders and their restrictions/overlays in the absence of specific requirements from one of the agencies. Many lenders will want it to […]

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Refinancing a Car for a Mortgage Down Payment

Question: Can a borrower refinance a car and use the equity for a down payment on an FHA loan? Answer: Unfortunately, no. FHA requires collateralized loans to be taken against a financial asset or real estate. See the full guidelines below. Reference: 4000.1, II.A.4.d.iii (K) Loans (TOTAL) A Loan refers to an arrangement in which a […]

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VA E-signing Requirements

Question: Are there any documents excluding closing documents that need to be wet signed by the Veteran, or will VA allow all documents to be e-signed? Answer: VA states in both Chapter 4 and Chapter 9 that “digital signatures can be accepted as an original signature or wet signature as defined by the Electronic Signatures in […]

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