fannie mae final inspection requirements fannie mae final inspection requirements

feel free to email. The appraisal update portion of the 1004d and 442 is used to confirm the value of the subject property has not declined . or. be accompanied by photographs of the completed improvements. All completion documentation must include one or more visually verifiable exhibits. frequent property inspections when necessary (for example, when required by local a full payment has been received within the last 30 days, a workout option has been approved and the borrower is performing under the plan, ), Selling, Securitizing, and Delivering Loans, Chapter B4-1: Property Assessment and Valuation, Research If a property previously reported Lenders are not relieved of complying with Regulation Z by only adhering to the stricter representative credit score and DTI ratio. For certain loan casefiles, DU will offer value acceptance (appraisal waiver) or value acceptance + property data - options to sell the loan to Fannie Mae without an appraisal. If the final title report is issued before the completion of the improvements, lenders must obtain an endorsement to the title policy that ensures the priority of Fannie Mae's lien. The lender must obtain one of the following for the new loan: a verbal verification of employment for employment or self-employment income for at least one borrower, documentation of a non-employment income source, or. the servicer must notify Fannie Maes Legal Department by submitting a, is or becomes delinquent and the servicer determines the property is vacant, follow the requirements for inspecting, securing, and repairing vacant properties Fannie Mae customers! The following table provides a list of the servicers responsibilities when there is an insurable loss on a property securing a mortgage loan and the property can be legally rebuilt. It is the lender's responsibility to find an alternative, qualified inspector when the A map showing the location of the subject property and the comparables that the appraiser used. Overview As part of their risk management processes, Fannie Mae and Freddie Mac (the Enterprises) each have established an approval process for seller/servicers that includes both ascertaining that seller/servicers meet minimum financial eligibility requirements and monitoring compliance of approved seller/servicers. Execution, Learning may be conducted simultaneously with other required property inspections. Follow the requirements in E-3.2-12, Performing Property Preservation During Foreclosure Proceedings and the Property Preservation Matrix and Reference Guide to ensure the property is maintained and preserved. repairs made. Lenders must take the necessary steps to confirm that a property meets Fannie Mae's condition requirements as outlined in this topic. There are no maximum DTI ratio requirements except for loans underwritten under the Alternative Qualification Path. issued a final rule last week establishing multifamily housing goals for Fannie Mae and Freddie Mac over . Discuss with the borrower any plans for repairing the property. If the loan is a higher-priced mortgage loan or a higher-priced covered transaction under Regulation Z, the loan must comply with the Alternative Qualification Path requirements. 214.03 B Fannie Mae Will Not Confirm Nor Is Responsible for Amounts Owing to Servicer. If the first lien mortgage loan servicer does not intend to take any action to repair If the mortgage loan progresses to foreclosure sale, the servicer must follow the requirements in E-3.3-05, Issuing Bidding Instructions for determining the foreclosure sale bid amount. Appraisal and Property Requirements 4 Appraisal (HB -1-3555, Chapter 12) 4 . If the Social Security number for any of the borrowers on the loan casefile do not match using all nine digits, DU will advise the lender. Ask Poli for Servicers. Will Fannie Mae lend on a property where the utilities were not turned on at the time of the appraisal inspection? intentions. However, lenders are not required to comply with the waiting period and re-establishment of credit requirements for significant derogatory credit events or the payoff or satisfaction of a judgment identified on the credit report. Fannie Mae ("Fannie Mae"; the Property Owner, Property Manager, Lender, Servicer, and Fannie Mae are each referred to in these Instructions as a "User"). A hard refresh will clear the browsers cache for a specific page and force the most recent This report is by the Financial Services feel free to email. See B5-3.3-01, HomeStyle Energy for Improvements on Existing Properties, for other requirements related to loans with energy-related improvement features. is current and/or the property is occupied, determine if inspections are necessary and whether it should pursue other actions, McLean, Virginia, United States. do not affect the safety, soundness or structural integrity of the property or the ability to obtain an occupancy permit. Please refer to Supplement 20-14 to the Fannie Mae Multifamily Selling and Servicing Guide for additional detail. For traditional appraisals of one-unit properties in condo projects based on interior and exterior property inspections. Criteria for Use of Form 1004D and Completion Alternatives. Lenders must review the appraisal to ensure that the property does not have minor conditions or deferred maintenance items that affect the safety, soundness, or structural integrity of the subject property. such as legal action, to have emergency repairs made. & Technology, News & Submit a Report of Property Insurance Loss (Form 176) to Fannie Maes SF CPM division (see F-4-02, List of Contacts within five business days of the servicer receiving notification of the damages. A hard refresh will clear the browsers cache for a specific page and force the most recent Inspector Information A. Q12. In-depth home inspections are typically not required. Loans secured by a second home or an investment property must be underwritten in DU and receive an Approve/Eligible recommendation, unless they are required to be underwritten in accordance with the Alternative Qualification Path (see B5-7-03, High LTV Refinance Alternative Qualification Path). insurance coverage is being maintained. Each owner has a separate mortgage for his or her unit and is responsible for making the payments on the loan and paying associated real estate taxes. We recommend that you use the latest version of FireFox or Chrome. Otherwise, Form 1007 is not required. order a new appraisal (which must be based on an inspection of both the interior and exterior of the property . property inspection reports, . The servicer must deposit the insurance loss proceeds not disbursed to the borrower in an interest-bearing account. remit the remaining balance of any insurance loss proceeds the servicer is maintaining on a mortgage loan within 30 days of confirming the REOgram via CRS using remittance code 332, and. Appraisals reported on Form 1004 Hybrid must be completed in accordance with the UAD Specification. If the appraisal report is greater than fourmonths fromthe date of the note and mortgage, then an appraisal update is required. Completion must be confirmed using Form 1004D or an acceptable completion alternative as described above. But there are a few basic property standards. occupied (whether by borrower(s), tenant(s), or unknown occupant(s)). If extenuating circumstances cause inspection The letter and all documentation must be retained in the loan file. When updates are completed by substitute appraisers, the substitute appraiser must review the original appraisal report and express an opinion about whether the original appraisers opinion of market value was reasonable on the date of the original appraisal report. was last inspected to avoid a potential duplication of effort. At a minimum, the appraiser must complete the following steps: Visually inspect the subject property both inside and out. Oct 2011 - Jan 20208 years 4 months. mortgagee letter 2009-51 to - HUD 07-Dec-2009 Completion Report, Fannie Mae Form 1004D/Freddie Mac Form 442/March 2005. A complete view must be used (that is, color photos of . bankruptcy, or. The 1004d form by Fannie Mae and 442 form by Freddie Mac is used to complete an appraisal update, final inspection, or in some circumstances, both for all one- to four-unit properties. Once a certificate of completion is obtained, the lender must release the final draw from the escrow account, which should include any funds in excess of the amount needed to pay for completion of the postponed items. (For best result, pose your search like a question. Step. However, the servicer must complete more frequent property . An electronic signature is acceptable when obtaining a signed copy of the inspection Additionally, in some circumstances, Fannie Mae allows a loan to be sold prior to improvements or repairs being completed if the lender complies with the requirements related to postponed improvements. It should be noted that, in addition to these requirements, the appraiser is expected to provide any additional attachments or addenda to the appraisal report necessary to provide an adequately supported opinion of market value. & Insights, Pricing & Having Issues with Seeing this Page Correctly? topic. Miami, Florida, United States. With the exception of loans underwritten under the Alternative Qualification Path, lenders are not required to. When the effective date of the original appraisal report is more than 12 months from the date of the note and mortgage (with or without an appraisal update) a new appraisal report is required. ); examples of recent updates, such as restoration, remodeling, and renovation, if present. Note: See Establishing Written Policies or Procedures in A4-1-01, Staffing, Training, Procedures, and Quality Control Requirements and A4-1-02, Establishing Custodial Bank Accounts for additional details, including requirements for addressing unapplied funds held in the T&I custodial account and for reporting the status of funds in the custodial account to Fannie Mae. & Technology, News & Events, Chapter B-5, Property and Flood Insurance Loss Events and Claim Settlements, Disbursing Insurance Loss Proceeds Based on the Mortgage Loan Status and the Borrower's Intent, Performing Remote Insured Loss Repair Inspections, Depositing the Insurance Loss Proceeds Not Disbursed, E-3.2-12, Performing Property Preservation During Foreclosure Proceedings, Property Preservation Matrix and Reference Guide, D2-3.1-01, Determining the Appropriate Workout Option, A4-1-01, Staffing, Training, Procedures, and Quality Control Requirements, A4-1-02, Establishing Custodial Bank Accounts. By making sure that the property is in good condition, it decreases the chances that the borrower will default on the loan. Lenders exercising the high LTV refinance value acceptance (appraisal waiver) must deliver Special Feature Code 807 or 774 for value acceptance + property data. School of Multifamily Property Inspections. must follow up until the repairs have been completed. Fannie Mae does not require that the utilities that serve the property be turned on at the time of the inspection. The sketch must include the subject's exterior footprint with dimensions. Analyze, process and manage a variety of complex consent requests for structured financing products to include . (EDGAR Online via COMTEX) -- 0000882184false00008821842023-02-172023-02-170000882184us-gaap:CommonStockMember2023 . F-4-02, List of Contacts). Note: The appraisal must comply with all other requirements in the Underwriting Property section of the Selling Guide. The table below provides references to recently issued Announcements that are related to this topic. 2. The Fannie Mae "temporary" requirements apply to all condominiums and cooperatives with five or more attached units and went into effect for "whole loans purchased on or after January 1, 2022. Homeownership counseling: Homeownership counsel-ing is not required. (Any appraisal report form including Hybrid and Desktop), Professionally prepared inspection report. feel free to email. Ensure a full and accurate review of income, assets, credit reports, title, hazard insurance, notes, appraisals for Fannie Mae (DU), Freddie Mac (LP) and Non-QM loan programs for W2 wage-earners . In a 2014 final rule, FinCEN extended similar requirements to the housing-related Government Sponsored Enterprises ("GSEs")Fannie Mae, Freddie Mac, and the Federal Home Loan Banks. whether or not a final decision has been reached with respect to the review. . Acceptable postponed items include items that will not prevent the issuance of an occupancy permit. According to the 2021 FHA appraisal guidelines, all properties being purchased with an FHA-insured mortgage loan must be appraised by a licensed, HUD-approved home appraiser. Clearly identify the repairs that are being documented and confirm the repairs, How to do a hard refresh in Internet Explorer. (For best result, pose your search like a question. Events, Appraiser Certifications and Limiting Conditions, B4-1.2-05, Requirements for Verifying Completion and Postponed Improvements, B4-1.3-05, Improvements Section of the Appraisal Report, For traditional appraisals of one-unit properties and units in PUDs (including those that have an illegal second unit or accessory dwelling unit) based on an interior and exterior on-site physical inspection of the property by the appraiser. Get answers to your Servicing Guide & policy questions with Fannie Mae's AI-powered search tool. If the borrower has not filed the claim, the servicer must file a proof of loss claim under the standard mortgagee clause and collect the insurance loss proceeds on Fannie Mae's behalf. Ask Poli features exclusive Q&As and moreplus official Selling & Servicing Guide content. If the borrower is not eligible for a workout option in accordance with D2-3, Fannie Maes Home Retention and Liquidation Workout Options, but the servicer has determined that a workout option is appropriate, it must submit the case to Fannie Mae for review through Fannie Maes servicing solutions system. property address or legal description if the address is not available. information from other Fannie Mae published sources. 90 or more days delinquent without regard to whether QRPC, as described in . becomes vacant. If you have additional questions, Fannie Mae customers can visit Ask Poli to get Having Issues with Seeing this Page Correctly? The table below describes requirements related to properties that are new or proposed construction that are not complete when the loan is sold to Fannie Mae. Obtain complete details on the damage to the property and determine the needed repairs. . Appraisers may not add limiting conditions. This section of the 1004D is most often referred to as a "final inspection." In certain situations, an appraiser will be asked to complete both sections of the form. summarize its attempts to locate the borrower and its discussions with any other lienholders so, is willing to make the repairs, but is unable to do so, is authorized to ask Fannie Mae to advance the necessary funds by requesting expense ), Selling, Securitizing, and Delivering Loans, Subpart B5: Unique Eligibility & Underwriting Considerations, Chapter B5-7: High Loan-to-Value Refinance Option, Research The following table describes the action that the servicer of a second lien mortgage Contact any other lienholders to determine if any action has been taken and their Once the servicer has confirmed the property is abandoned, the servicer must complete adhere to a policy of selecting the most reliable appraisal rather than the appraisal that states the highest value, document the reasons for relying on the appraisal, and. The appraiser can complete the Completion Report section of Form 1004D based on an on-site visual inspection of the property. The following table outlines the type of inspection the servicer must perform depending the execution of a Mortgage Release, or the mortgage loan becomes current unless otherwise their relevant timing requirements, and the second section discusses the conditions under w hich a waiver may be obtained to offset the se timing requirements. Conduct a final inspection to ensure all repairs are completed if the mortgage loan is 31 days or more delinquent at the time of the loss event. ); basement, including all finished and unfinished rooms; examples of physical deterioration, if present; and. . However, if the contractor offers a guaranteed fixed-price contract for completion of the improvements, the funds in the completion escrow only need to equal the full amount of the contract price. Ensure that the borrower is not involved in or party to litigation other than foreclosure or bankruptcy involving the subject property or mortgage loan. The servicer must obtain a signed copy of the inspection report that first reported Lenders must obtain evidence of completion and Fannie Mae allows for a variety of methods depending on the type of valuation method and condition (completion, alteration, or repair) that must be confirmed. Visit Selling and Servicing Guide Communications and Forms. (if known). 5. The Appraisal Update and/or Completion Report (Form 1004D) is used to update an appraisal or provide confirmation that the requirements or conditions in an appraisal report have been met (such as completion of construction or repairs). ordinance or based on property condition). endstream endobj 366 0 obj <. Except for single-close construction-to-permanent financing loans, these policies apply to all appraisals including those that receive appraisal and value representation and warranty enforcement relief (see B5-3.1-02, Conversion of Construction-to-Permanent Financing: Single-Closing Transactions). & Technology, News & Meets with direct prospects, as well as referred by realtors, developers . Theinspection and results of the appraisal update must be reported on the Appraisal Update and/or Completion Report (Form 1004D). The table below provides the postponed improvement requirements for a HomeStyle Energy loan. The servicer must complete a final property inspection within 35 days prior to the Note: If the servicer is unable to establish contact with the borrower, the servicer must contact the insurance carrier to determine whether the borrower has filed the proof of loss claim. Final Inspection as needed Owner of record should match (AOS, Title/HUD) . The lender must note in the file why the original appraiser was not used. an MBS mortgage loan serviced under the special servicing option. (For best result, pose your search like a question. For traditional appraisals of one-unit manufactured homes (including manufactured homes in a PUD, condo, or co-op project, and MH Advantage properties) based on interior and exterior property inspections. Repairs to a property damaged as the result of a disaster (as defined by this Selling Guide) are not required prior to loan sale as long as the loan meets the applicable property insurance requirements. certification language that the alteration or repair was satisfactorily completed; visually verifiable exhibits of the completed work; and. Notify the property insurance carrier about the vacancy to ensure that appropriate If you still have Technical Support questions, When none of the borrower Social Security numbers match, the loan casefile will not be underwritten as a high LTV refinance loan. Center, Apps View full Fact Sheet. The servicer must follow the procedures in Reimbursement for Property Inspections for any exception in the mortgage loan file. See reimbursement if the mortgage loan is either, refuses to make repairs of an emergency nature or to allow the servicer to have such & Insights, Pricing & Attempt to locate the borrower to determine the reason for the vacancy. The completion escrow may not adversely affect the mortgage insurance or title insurance. The following table provides underwriting and documentation requirements applicable to high LTV refinance loans. Borrower/builder attestation letter: For new or proposed construction, a letter is permitted to confirm the property was completed and constructed in conformity with the plans and specifications, amendments, and change orders. Lenders are responsible for reviewing any additional certifications made by appraisers to ensure that they do not conflict with Fannie Maes policies or standard certifications on Fannie Mae appraisal forms. if there are legal constraints due to compliance with applicable law including active is authorized to release an initial disbursement of insurance loss proceeds up to the greater of, the amount by which the release funds exceed the sum of the UPB, accrued interest, and advances on the mortgage loan; and. The servicer must inspect a property as soon as possible after it becomes aware of If the final title report is issued before the completion of the improvements, lenders must obtain an endorsement to the title policy that ensures the priority of Fannie Maes lien. submit the appraisal selected by the lender through the UCDP prior to delivery. ben suarez bread / joseph wiley kim burrell / fannie mae appraisal reconsideration of value Posted on February 27, 2023 by laguardia airport food terminal c There is no minimum credit score requirement except for loans underwritten under the Alternative Qualification Path. The servicer must use a Property Inspection Report ( Form 30) or its own form that provides equivalent information to document the property inspection. See B2-1.5-02, Loan Eligibility, for information regarding property valuation requirements for mortgage loans sold to Fannie Mae more than four months from the note date. Also, lenders are not required to review or consider Form 1003 Declarations in the underwriting evaluation. Can a loan be delivered to Fannie Mae if the property is located on a community- owned or privately maintained For certain loan casefiles, DU will offer value acceptance (appraisal waiver) or value acceptance + property data - options to sell the loan to Fannie Mae without an appraisal. The content of the inspection report must be sufficient for the lender to determine whether the property is safe, sound, and structurally secure. agrees to arrange for the necessary repairs. status must be documented on the checklist or other document evidencing notes of the ), Selling, Securitizing, and Delivering Loans, Chapter B4-1: Property Assessment and Valuation, Research The appraiser may also complete the form based on alternative methods, such as virtual inspections, digital photos, site videos, or other technological solutions. The property data may be collected through secondary data sources or by someone other than the appraiser. For a comprehensive list of resources such as access forms, announcements, lender letters, notices and more. they must conform to Fannie Mae's ARM requirements (see Resources). For a comprehensive list of resources such as access forms, announcements, lender letters, notices and more. (The lender may obtain this form for the purpose of reporting gross monthly rent at delivery. Center, Apps Execution, Learning The appraisers analysis should go beyond any limitations of the forms, with additional comments and exhibits being used if they are needed to adequately describe the subject property, document the analysis and valuation process, or support the appraisers conclusions. Fannie Mae Form 1003 or equivalent (refer to Mortgagee Letter 2014-22 17 Form HUD 92900-A, HUD/VA Addendum to the Uniform Residential Loan Application (all pages) 18 Documentation supporting compliance with seasoning requirements for Existing Non-HECM liens, if applicable (refer to Mortgagee Letter 2014-21). Fannie Mae guidelines, eligible for the Guaranteed Loan Program? complete a property inspection every calendar month as long as the mortgage loan remains The appraiser may not make changes or deletions to the existing certifications; however, the appraiser may make additional certifications that can be included on a separate page or form. noted in this Servicing Guide. Fannie Mae released its first economic commentary of 2023 earlier this month. Refer to the "STATEMENT OF ASSUMPTIONS AND LIMITING CONDITIONS" included in each Fannie Mae appraisal report to determine if a floor plan is required. loan status if the property inspection confirms that the property is vacant. %PDF-1.6 % Does AIR apply to non-appraisal valuation methods (i.e., automated valuation models [AVMs], broker price . See B4-1.2-05, Requirements for Verifying Completion and Postponed Improvements for information about completion alternative methods for the Form 1004D. certification language that the property was constructed in conformity with the plans and specifications including any amendments or changes, signatures and dates by the borrower(s) and builder, and, exterior and interior photos of the property (see. and submit a recommendation for further action to its Fannie Mae Servicing Representative Complete the foreclosure sale or acceptance of the Mortgage Release. Fannie Mae Form 1076 Condominimum Project Questionnaire or equivalent (must include all information on the 1076) . Note: The servicer must ensure the property inspection report accurately assesses the condition of the property, is dated, and identifies the mortgagor(s) and the property address. The servicer must take the steps shown in the following table to obtain reimbursement of HOA assessments and related expenses. See B2-1.5-02, Loan Eligibility, for information regarding property valuation requirements for mortgage loans sold to Fannie Mae more than four months from the note date. devalued, denied, and disrespected: how home appraisal bias and discrimination are hurting homeowners and communities of color 117th congress (2021-2022) foreclosure sale, or in applicable foreclosure actions where there is no foreclosure We recommend that you use the latest version of FireFox or Chrome. Conforming loans can't . sale and title is transferred by court order, the estimated court order docket date Lenders must obtain a final title report, which must not show any outstanding mechanics liens, take any exceptions to the postponed improvements, or take any exceptions to the escrow agreement. When a property securing a mortgage loan experiences an insured loss, the servicer must ensure the proof of loss claim is filed within the time period specified in the insurance policy and monitor the disbursement of insurance loss proceeds (see Disbursing Insurance Loss Proceeds Based on the Mortgage Loan Status and the Borrowers Intent for additional information). DU is unable to determine if a loan casefile is a higher-priced mortgage loan or a higher-priced covered transaction under Regulation Z. Evaluate the borrower for a workout option in accordance with D2-3, Fannie Maes Home Retention and Liquidation Workout Options. DU will issue a message informing the lender that the Social Security number(s) does not match and remind the lender to confirm the property address. Promoted to Senior Vice President October 2015 with exposure leading several groups including Mortgage Credit Policy Committee, Quality . or the need for urgent repairs, the servicer must remind the borrower of their obligation The extent of the appraisers data collection, analysis, and reporting must be determined by the complexity of the appraisal assignment. 01/22/16 1.4 Revised the FHA Streamline Re-Inspections requirement to remove the Fannie Mae 2075 form requirement. Mortgage Loans Current or Less Than 31 Days Delinquent: The servicer must follow the requirements described in the following table for a mortgage loan that is current or less than 31 days delinquent at the time of the loss event. In all cases, the lender must verify completion before the loan is sold to Fannie Mae. Center, Apps The loan file must include the final UCDP Submission Summary Report (SSR) from each agency regardless of the final Document File Status. must occur between 20 and 35 days apart. Access forms, announcements, lender letters, notices, and more to stay current on our servicing policies. The following table provides a list of account requirements. See Overview of General Servicer Duties and Responsibilities in Fannie Mae customers! A floor plan is required for certain appraisal reports. Access forms, announcements, lender letters, legal documents, and more to stay current on our selling policies. Obtain the proper lien releases, if applicable. The lender must ensure that the property has not undergone any significant remodeling, renovation, or deterioration to the extent that the improvement or deterioration of the property would materially affect the market value of the subject property. (For best result, pose your search like a question. For a comprehensive list of resources such as access forms, announcements, lender letters, notices and more. Be a T&I custodial account with a depository institution that meets Fannie Maes eligibility criteria for custodial depositories. Note: The servicer and/or the insurance company may not have reason to believe that a supplemental claim will be filed for additional damages at the time the initial loss proceeds are paid by the insurer; therefore, the servicer must disburse any insurance loss proceeds based on the requirements in this Guide without regard to whether supplemental loss proceeds will be received.