Announcement 2024

Disaster Policy Update – California

Federal Emergency Management Agency (FEMA) announced a Major Disaster for the counties in California listed below due to recent severe storms and flooding.

Reference: FEMA Announcement

Declaration Date: February 19, 2024

Incident Period: January 21, 2024 to January 23, 2024

Designated Counties: San Diego

If the subject property is located in one of the designated counties above and the appraisal was completed on or before January 21, 2024 or did not require an appraisal, MK Lending Corp. will require an inspection report to determine the property’s condition using one of the following:

• 1004-D
• MK Lending Attestation – Disaster Form

Announcement 2023 - 59

Fannie Mae SEL-2023-09/11 Guideline Update
We are aligning with the recent Fannie Mae announcements. The announcement is summarized below.

[Announcement 2023-58]

2024 New Loan Limits

Effective immediately, MK Lending is aligning with The Federal Housing Finance Agency’s (FHFA) new 2024 conforming and high-cost area loan limits.

Agency: Federal Housing finance Agency (FHFA)

The 2024 loan limits will be applied to DU/LP loan casefiles submitted (or resubmitted) on or after the weekend of 12/2/2023. Also note that loan casefiles underwritten through DU/LP prior to 12/2/2023 that receive an ineligible recommendation due only to exceeding the 2023 loan limit may apply the 2024 loan limit. The loan casefile does not have to be resubmitted to DU/LP if the only reason for the DU/LP ineligible recommendation is due to the loan amount, and the loan amount complies with the applicable 2024 conforming loan limit value.

Announcement 2023 - 57

We are aligning with the recent Fannie Mae announcements. The announcement is summarized below.

Agency: Fannie Mae

Agency Announcement: Responsibly Increasing Affordable Housing Supply & Access to Credit

2-4 Unit Max LTV/CLTV/HCLTV Increasing to 95% (Primary Residence – Purchase/Limited Cash-Out)

Effective Date: Beginning November 18, 2023

Summary: The maximum allowable LTV/CLTV/HCLTV increasing to 95% for 2-4 unit, primary residence, purchase and limited cash-out transactions.

Does not apply to the following:

• Cash-Out Refinancing loans
• High-Balance loans

NonQM LTV Updates

Announcement 2023 - 56

 Effective immediately, MK Lending updated following NonQM programs.

Announcement 2023 - 55

HELOAN-1 Program Updates

Effective 9/26/2023, MK Lending updated HELOAN-1 program guide. Please see following updates.

Announcement 2023 - Disaster Policy – Georgia

<Georgia Hurricane Idalia>

Federal Emergency Management Agency (FEMA) announced a Major Disaster for the counties in Georgia listed below due to Hurricane Idalia.

Reference: FEMA Announcement

Effective Date: August 30, 2023 to September 9, 2023

Designated Counties: Cook, Glynn, & Lowndes

If the subject property is located in one of the designated counties above and the appraisal was completed on or before September 9, 2023 or did not require an appraisal, MK Lending Corp. will require an inspection report to determine the property’s condition using one of the following:

• 1004-D
• MK Lending Attestation – Disaster Form

Announcement 2023 - Disaster Policy Update – Florida

Federal Emergency Management Agency (FEMA) announced a Major Disaster for the counties in Florida listed below due to Hurricane Idalia.

Reference: FEMA Announcement

Effective Date: August 30, 2023 to September 4, 2023

Designated Counties: Citrus, Dixie, Levy, Pasco, Pinellas, Taylor, Gilchrist, Jefferson, Lafayette, Madison, Suwannee, Columbia, Hernando, Hamilton, Manatee, & Sarasota

If the subject property is located in one of the designated counties above and the appraisal was completed on or before September 4, 2023 or did not require an appraisal, MK Lending Corp. will require an inspection report to determine the property’s condition using one of the following:

• 1004-D
• MK Lending Attestation – Disaster Form

Announcement 2023 - 53

SNQ EZ Program Updates

Effective 9/8/2023, MK Lending updated SNQ EZ program as follows:

• Condominium LTV <= 60% rate adjustment 0.125% has been removed
• Condominium LTV > 60% rate adjustment 0.375% has been reduced to 0.125%
• Transferred appraisal not acceptable
• Foreign National:
  • Credit Report to be pulled to check if there's any negative history. No Fico score required
  • All documents must be translated by a certified translator
  • Asset verification (must be in U.S. banking institutions)

Announcement 2023 - 52

HELOAN-1 Program Updates

Effective 9/7/2023, MK Lending updated HELOAN-1 program as follows:

• Maximum loan amount increased to $550,000
• Maximum combined liens allowed increase to $2.5M on higher loan levels
• Added maximum CLTV on 2-4 unit to 75% CLTV owner-occupied, and 70% CLTV non-owner

Announcement 2023 - 51

NonQM Plus Program CLTV Updates

Effective 9/6/2023, MK Lending updated NonQM Plus program CLTV as follows:

PL Plus, VOE Plus, and DSCR Plus max CLTV has improved. Please see below for the update.

Announcement 2023 - Disaster Policy Update – Florida

Federal Emergency Management Agency (FEMA) announced a Major Disaster for the counties in Florida listed below due to Hurricane Idalia. loans in the following counties are temporarily suspended until further notice.

Reference: FEMA Announcement

Effective Date: August 30, 2023

Designated Counties: Citrus, Dixie, Levy, Pasco, Pinellas, Taylor, Gilchrist, Jefferson, Lafayette, Madison, Suwannee, Columbia, Hernando, & Hamilton

Announcement 2023 - 48

Fannie Mae SEL-2023-09 Limited Cash-Out Eligibility

MK Lending is aligning with the recent Fannie Mae announcements. The announcement is summarized below.

Agency:Fannie Mae

Agency Announcement:SEL-2023-06

Eligibility requirements for limited cash-out refinance transactions

Effective Date:Loan applications beginning Sept. 1, 2023

Summary:The eligibility requirements for limited cash-out refinances to stipulate that at least one borrower on the new loan must be a current owner of the subject property (on title) at the time of the initial loan application. Exceptions to this policy are permitted in the following scenarios:

• the borrower acquired the property through an inheritance or was legally awarded the property via a legal settlement or divorce decree, or

• the property was previously owned by an inter vivos revocable trust and the borrower is the primary beneficiary of the trust.

Announcement 2023 - 47

Disaster Policy Update – California

<California Storm and Weather>

Federal Emergency Management Agency (FEMA) announced a Major Disaster for the counties in California listed below due to recent severe storms, flooding, landslides and mudslides.

Reference: FEMA Announcement

Declaration Date: April 3, 2023

Incident Period: February 21, 2023 to July 10, 2023

Designated Counties: Butte, Kern, Madera, Mariposa, Mendocino, Mono, Monterey, Nevada, San Benito, San Bernardino, San Luis Obispo, Santa Cruz, Tulare, and Tuolumne

If the subject property is located in one of the designated counties above and the appraisal was completed on or before July 10, 2023 or did not require an appraisal, MK Lending Corp. will require an inspection report to determine the property’s condition using one of the following:

-          1004-D

-          MK Lending Attestation – Disaster Form

Announcement 2023 - 46

NonQM Program LTV & Guideline Updates

Effective 7/10/2023, MK Lending updated NonQM program LTV as follows:

• NonQM LTV has been updated for: 1Yr Prime/Credit, Alt Doc Prime/Credit, PL Prime, & DSCR

•       NonQM guideline has been updated. Please click the following link to see the updates.

-          Matrix (Redline)

-          1Yr Income Prime, Alt Doc Prime, and PL Prime now allows 1x30x12 housing payments.

Announcement 2023 - 45

Disaster Policy Update – California

<California Storm and Weather>

Federal Emergency Management Agency (FEMA) announced a Major Disaster for the counties in California listed below due to recent severe storms, flooding, landslides and mudslides.

Reference: FEMA Announcement

We will continue to monitor FEMA announcements and add or remove any additional area as needed.

If the subject property is located in one of the designated counties above and the appraisal was completed on or before the incident date or did not require an appraisal, MK Lending Corp. will require an inspection report to determine the property’s condition using one of the following:

-          1004-D

-          MK Lending Attestation – Disaster Form

Announcement 2023 - 44

NonQM Plus Price Adjustment & Guideline Update

Effective 7/5/2023, MK Lending updated NonQM Plus programs as follows:

• NonQM Plus Loan Level Price Adjustment (LLPA) has been updated.

• NonQM Plus guideline has been updated. Please click the following link to see the updates.

-          PL Plus & VOE Plus matrix (Redline)

-          DSCR Plus matrix (Redline)

DSCR Plus max LTV 80% available for:

1. FICO 740+,
2. Loan Amount ≤ $1M,
3. DSCR ≥ 1, and
4. Purchase or Rate/Term Refinance
   

Announcement 2023 - 42

ITIN Guideline Update

ITIN guideline has been updated. Please click the following link to review updated guideline.

ITIN Matrix Update (Redline Version)

ITIN Matrix Update (Clean Version)

Announcement 2023 - 41

VOE Plus and PL Plus Price Adjustment Improvement

Effective immediately, MK Lending will improve Loan Level Price Adjustment (LLPA) for VOE Plus and PL Plus program. LLPA will be improved up to 0.375%. Please see below for the LLPA update.

Announcement 2023 - 38

Fannie Mae SEL-2023-05 Guideline Update

MK Lending is aligning with the recent Agency announcements. The announcements are summarized below with a link to the Agency’s full announcement.

Agency: Fannie Mae

Agency Announcement: SEL-2023-05

Manufactured Home – Temporary Interest Rate Buydowns (Fannie Mae Direct only)

Effective Date: 8/19/2023

Summary: Temporary interest rate buydowns will be allowed for mortgages secured by manufactured homes, including both single- and multi-width manufactured homes. Loans are subject to the standard buydown policies in the Selling Guide, including B2-1.4-04, Temporary Interest Rate Buydowns.

Qualifying Rate for 7- and 10-year ARMs

Effective Date: 8/19/2023

Summary: 7- and 10-year ARM borrowers to be qualified using only the note rate. MK Lending will still require all files to pass HPML.

Acceptable uses for limited cash-out refinance transactions

Effective Date: Immediately

Summary: The proceeds may be used to satisfy additional amounts required to pay off the existing first mortgage, including a deferred balance resulting from previous loss mitigation, and late fees; and allowing the proceeds to be used to satisfy any share of appreciation due to a provider under the terms of a shared appreciation agreement when the subordinate lien is a Community Seconds® loan.

Announcement 2023 - 37

SNQ EZ Guideline Update

SNQ EZ guideline has been updated. Please click the following link to review updated guideline.

SNQ EZ Matrix Update (Redline Version)

Announcement 2023 - 33

FHFA – DTI LLPA Rescinded

MK Lending is aligning with the recent Agency announcements. The announcements are summarized below with a link to the Agency’s full announcement.

Agency: Federal Housing Finance Agency (FHFA)

Effective Date: 5/10/2023

Agency Announcement: FHFA Announces Rescission of Enterprise Upfront Fees Based on Debt-To-Income (DTI) Ratio

Summary: Rescinding the DTI loan-level pricing adjustments (LLPA) from Fannie Mae’s and Freddie Mac’s pricing grid updates in January that was scheduled to take effect on August 1, 2023. 

Announcement 2023 - 31

Fannie Mae SEL-2023-04 Alternatives for Tax Filing Documentation

MK Lending is aligning with the recent Agency announcements. The announcements are summarized below with a link to the agency’s full announcement.

Agency: Fannie Mae

Effective Date: 5/3/2023

Agency Announcement: SEL-2023-04

Summary: To align our policies with recent changes made by the IRS, we will allow alternative documentation for IRS Form 4868 as evidence the borrower has filed an extension for the prior year’s tax returns. We are updating our policy to permit proof of e-filing of IRS Form 4868 or payment confirmation (including the confirmation number) of all or part of the estimated income taxes due to support that the borrower has filed an extension.

Announcement 2023 - 30

Disaster Policy – Florida

Federal Emergency Management Agency (FEMA) announced a Major Disaster for the counties in Florida listed below due to recent severe storms, tornadoes, and flooding. Effective immediately, loans in the following counties are temporarily suspended until further notice.

Reference: FEMA Announcement

We will continue to monitor FEMA announcements and add or remove any additional area as needed.

In response to the potential damage caused by the event listed above, MK Lending requires Disaster Re-inspection for listed areas.

Announcement 2023 - 29

Loan Submission Process Update

Effective immediately, MK Lending will start utilizing Loan Submission Form section in Additional Information tab.

• PDF Loan Submission Sheet is no longer required
• Please complete the Loan Submission Form section (See below)
• PDF Fee Sheets are still required

Announcement 2023 - 28

Manufactured Home Update

 Please see the following update regarding Manufactured Home for Fannie Mae Direct program.

• MK Lending has started accepting Single-Wide Manufactured Home this week. Please see the following details:

1. Fannie Mae Direct program only
2. 1 Unit only
3. Primary only
4. Purchase and Rate & Term Refinance only
5. Cash-out Refinance not allowed
6. Max LTV 80%
7. Min 400 SQFT and 12 FT wide
8. Appraisal: 2 similar comps, 1 comp to be similar configuration

• Manufactured Home price adjustment (LLPA) has been updated for Fannie Mae Direct program as follows:

1. Multi-Wide Manufactured Home price adjustment was updated from 1.00 à 0.50
2. Single-Wide Manufactured Home price adjustment will remain 1.00

Announcement 2023 - 26

Fannie Mae SEL 2023-02 Valuation Modernization

MK Lending is aligning with the recent Agency announcements. The announcements are summarized below with a link to the gency’s full announcement.

Agency: Fannie Mae

Effective Date: 4/17/2023

Agency Announcement: SEL-2023-02

Summary: Fannie Mae has updated the terms and range of appraisal alternatives:

Use of Value Acceptance: Used in conjunction with the term “Appraisal Waiver”

Value Acceptance + Property Data: A new option that utilizes property data collection by a third party who conducts interior and exterior data collection on the subject property. When this option is used an appraisal is not required. This option also requires submission of the data to Fannie Mae’s Property Data API.

Hybrid Appraisals: Based on interior and exterior property data collection by a third party that is provided to an appraiser to inform the appraisal.

Announcement 2023 - 25

 Fannie Mae SEL-2023-03 Conventional Policy Changes

MK Lending is aligning with the recent Agency announcements. The announcements are summarized below with a link to the Agency’s full announcement.

Agency: Fannie Mae

Effective Date: Immediately

Agency Announcement: SEL-2023-03

Summary: Fannie Mae has updated the Selling Guide to include changes to the following:

Medical Collections: Revised underwriting requirements for collections and charge-offs on non-mortgage accounts. Specifically, medical collection accounts are no longer required to be paid off at or prior to closing for DU underwritten loans, regardless of the amount. This change will align the Selling Guide policy with DU’s risk assessment.

Use of earned real estate commission: Fannie Mae updated policy on verification of non-depository assets to permit the use of the borrower’s earned real estate commission for down payment and closing costs. The  borrower may use earned real estate commission as an eligible source of funds when the borrower is a licensed real estate agent and will receive a sales commission from the purchase of the subject property.

DU minimum reserve requirements: Minimum Reserve Requirements was updated to describe in more detail how DU determines the amount of required reserves for loan casefiles based on the transaction type, risk assessment of the loan casefile, and other factors.

MK Lending is aligning with Freddie Mac regarding Accessory Dwelling Units announced in Bulletin 2022-11.

Properties with an ADU

• Previously, a property with an ADU was eligible only if the property was a 1-unit dwelling.
• Effective immediately, MK Lending is aligning with Freddie Mac to allow One ADU on 2- and 3-unit properties.
• 4 unit properties with ADU Not Permitted

Rental Income from an ADU for 1-Unit Primary Residence

• Previously, RENTAL income from an ADU on a 1-unit Primary Residence could be considered for qualifying income only when the borrower had a disability and the rental income was from a live-in aide, or when the loan was a Home Possible Mortgage.
• Effective immediately, MK Lending is aligning with Freddie Mac to allow rental income generated from an ADU on a subject 1-unit Primary Residence to be considered when qualifying a borrower for a purchase or a “no cash-out” refinance, provided the requirements in Freddie Mac Selling Guide section 5306.3 are met.
• The ADU Must comply with zoning and land use requirements (legal, legal nonconforming or no zoning).
• The appraisal report must support the ADU’s marketability and include at least one (1) comparable sale with a rented ADU.
• An appraisal waiver is Not permitted.  MUST have an appraisal report when using rental income from an ADU.
• The appraiser’s rental analysis must include a minimum of three (3) comparable rentals that support the market rent of the ADU, and at least one of the comparable rentals must be a property with an ADU.
• The ADU rental income used to qualify must not exceed 30% of the total stable qualifying monthly income.
• At least one (1) of the qualifying borrowers must participate in a landlord education program or have had previous landlord experience