Tag: Reserves

VA Reserve Requirements-Using Retirement Funds

Question: Does VA have a percentage requirement for the use of retirement funds when using those funds as reserves? Answer:  While the lack of clear guidance (on so many topics) in the VA Handbook is frustrating for all of us, VA still expects common-sense and prudent underwriting standards to be applied regardless of their lack […]

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Freddie Mac – LPA Feedback Message Updates – Effective March 29, 2020

Written by: Lloyd Rutherford, Staff Writer LPA [Loan Product Advisor] continues to become more sophisticated to assist lenders in avoiding mistakes that result in denied loans or buybacks.  Read through this article to learn the new feedback messages being adopted by Freddie Mac in March. Rule Synopsis: Freddie Issues notification that they are updating Feedback […]

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Can Employer Profit Sharing be Used as Reserves?

Question: Can we use profit sharing from an employer as reserves on a Fannie Mae loan? Answer: Here is what I have in the selling guide for Fannie Mae (Freddie is basically the same).  Unfortunately, this is not listed as an eligible asset.  I think the litmus test lives in the first statement under the […]

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Are Reserves Required on Reverse Mortgages?

Question: I have a 3-Unit Reverse Mortgage and am being asked to provide reserves.  Is this required by FHA? Answer: Per the HECM Guidelines and Financial Assessment Guide, there are NO listed requirements for reserves on any, one-four family units when underwriting a HECM.   On a regular FORWARD mortgage, yes, that would be a HUD guideline […]

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Freddie Mac – LPA Feedback Message Updates – Effective December 3, 2019 and January 25, 2020 and February 4, 2020 – Dated November 21, 2019

Written by: Lloyd Rutherford, Staff Writer One of the best things you can do for your business is to understand how your AUS systems work. This update on Loan Product Advisor shares some important changes you need to know to get the results you want! Rule Synopsis: Freddie Issues notification that they are updating Feedback […]

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