Fannie Mae issued Selling Guide Announcement SEL-2023-03 (Announcement), setting forth updates to the Selling Guide. Per the Announcement, Fannie Mae:
- Removed the requirement that medical collection accounts be paid off at or prior to closing for both Desktop Underwriter (DU) and manually underwritten loans, regardless of the amount (aligning Selling Guide policy with the risk assessment performed by DU);
- Removed the requirement for manually underwritten loans allowing certain unpaid collections and charge offs on non-mortgage accounts to remain unpaid if the borrower had a strong credit profile and meaningful reserves (going forward, non-medical collections accounts and non-mortgage charge off accounts that exceed $250 individually or $1,000 in aggregate are required be paid in full at or prior to closing);
- Revised Compliance with Laws policy to require lenders to report to Fannie Mae’s Ethics division all instances of penalties (civil or criminal) or enforcement actions for compliance failures or violations related to Office of Foreign Assets Control regulations;
- Updated verification of non-depository assets policy to permit the use of a borrower’s earned real estate commission for down payments and closing costs if the borrower receives a sales commission from the purchase of the subject property; and
- Added language to describe in more detail how DU determines the amount of required reserves for loan casefiles based on the transaction type and risk assessment.
Revisions related to the reporting of violations related to the Office of Foreign Assets Control regulations are effective May 1, 2023 (servicers are, however, encouraged to implement the reporting requirement immediately). All other revisions are effective April 5, 2023.
Click to view the Fannie Mae Selling Guide Announcement SEL-2023-03: https://www.tenaco.com/wp-content/uploads/2023/04/Fannie-Mae-Selling-Guide-Announcement-SEL-2023-03-04-05-23.pdf
