Updates to Conventional Products
Net tangible benefit (ntb) update
Effective July 15, 2019, NewRez is updating the requirements for the conventional Net Tangible Benefit requirements on conforming conventional loans. A Net Tangible Benefit test will only be required in the following circumstances.
- The following states will require that the loan meet the requirements of the generic NewRez Net Tangible Benefit Form: AR, IL, MN, NC, NM, OH, and WA.
- The following states will require that the applicable state-specific Net Tangible Benefit test and state-specific forms be completed and met: CO, MA, MD, ME, RI, SC, VA, and WV.
- A net tangible benefit form will not be completed for any state that is not listed above.
Conditions have been updated to support the new requirements.
Please reference the product profile and NewRez Net Tangible Benefit Form for full details.
HomeReady and home possible income limit change
The maxiumum income limit for HomeReady and Home Possible mortgages is being reduced to 80% of area median income.
Fannie Mae issued Lender Letter LL-2019-06 to announce changes to the income limits for HomeReady mortgages. Effective for new submissions to Desktop Underwriter (DU) on and after July 20, 2019 the Borrower's annual qualifying income, may not exceed 80% of the AMI for the location of the Mortgaged Premises. This change includes properties in low-income census tracts.
- If the initial submission to DU is prior to July 20, 2019, the borrowers' total annual qualifying income may not exceed 100% of AMI and there is no income limit for properties located in low-income census tracts.
Freddie Mac issued Bulletin 2019-15 to announce changes to the income limits for Home Possible mortgages. Effective for new submissions to Loan Product Advisor (LPA) on and after July 28, 2019, the Borrower's annual qualifying income may not exceed 80% of the AMI for the location of the Mortgaged Premises. This change includes properties in low-income census tracts.
- If the initial submission to LPA is prior to July 28, 2019, the borrowers' total annual qualifying income may not exceed 100% of AMI and there is no income limit for properties located in low-income census tracts
Very low-income program (vlip) retirement
The Very Low-Income Program (VLIP) available with Home Possible, is being retired for new registrations effective immediately. Pipeline loans currently utilizing VLIP may remain in the VLIP product.