Realtor Coaching & Training: mortgage finance
Freddie Mac is buying back the loans they have sold off to investors…when the borrower has missed 4 payments.
Here is how the process traditionally works:
Home buyer needs a mortgage——-> Loan Officer who works for ABC Mortgage originates a Fannie Mae mortgage for buyer/ borrower. ——–> ABC Mortgage has to follow the Fannie Mae lending guidelines in order for the loan to be a Fannie Mae loan. ———-> ABC Mortgage originates and closes the loan for the buyer. ———> ABC Mortgage becomes the servicer for the new FHA Mortgage. They collect the payments etc. ————> Loan is sold off to the secondary market.
Obviously, this is an over simplification. But, this is the process. Now, the problem comes in when ABC Mortgage didn’t follow the FHA Lending guidelines and issued a mortgage to a borrower who didn’t truly qualify. If the loan goes bad (4 payments) because ABC Mortgage’s not following the rules…then the Fannie and Freddie will force the originator (ABC) to literally buy the loan back. Remember, this is a ‘non-performing’ loan…no money is being collected.
(Lenders, feel free to post comments if my details are wrong)
We have also heard that Fannie Mae has hired hundreds of new auditors to ‘audit’ mortgages originated over the last 3-5 years. When they discover the originator (as in the back that originated the loan….) issued a mortgage and didn’t follow the Fannie guidelines…the originator is going to be forced to buy back the loan.
Think about all of this for a moment….all the flaky origination that has happened over the last few years may result in the originating mortgage companies actually being forced to buy back the loan they sold to Fannie Mae! How many of these lenders can afford to cover these bad loans?
Here is the story from CNBC.com
Government controlled mortgage finance company Freddie Mac says it will buy back troubled loans contained in securities it has already sold to investors.
The McLean, VA-based company said Wednesday it would repurchase mortgage loans in which borrowers have missed at least four months of payments. It did not disclose how much it would spend.
Freddie Mac guarantees the mortgage securities it sells. The company said buying the delinquent loans back would cost less than making those guarantee payments.
Freddie Mac and sibling company Fannie Mae have been run under tight government oversight since they almost collapsed in September 2008. They have required $111 billion in federal aid to stay afloat.
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2010 IS the year of the Short Sale…..in this market if you aren’t doing short sales…you are out of business. Depending on your market, short sales are the market….
Investors buying homes to rent or sell accounted for only 15 percent of the housing market last month as they competed with large numbers of first-time homebuyers flooding the market to buy in time to qualify for the first-time homebuyer credit. The percentage of first-time buyers closing on homes rose from 42 to 47 percent of all home sales in October, according to an Inside Mortgage Finance/Campbell Communications survey released today.
However short sales—sales for less that the owner owes on the property—soared in October. The shortsale inventory is booming as owners who are underwater on their mortgages seek to dispose of their homes. Short sales nationwide increased from 13 percent in June to 15 percent in October. Some 30 percent of properties sold last month in California were short sales, which were particularly popular with first-time buyers. They accounted for 57 percent of all short sale purchases, at an average price nationwide was $221,414.
UPDATE: Watch the 2 videos we created that explain what massive changes are taking place NOW with short sales. Everything you need to know about the NEW 2010 Treasury Department Guidelines.
Though investor purchases of bank-owned properties is declining, investors still accounted for more than half of the damaged bank-owned foreclosures sold during the month, and more than 72 percent used cash to make their purchases. About 13 percent of all homes sold were damaged REO properties.
Investors paid less on average than first-time and existing homeowners, an average of $186,831. First-time buyers paid $192,884 and existing owners $299,963 on average. Investors concentrated damaged REOs, which have declined from 20 percent to 15 percent of the market supply since July.
Competition is hot for damaged REOs; they attracted an average of four offers each in October. Damaged REOs sold for an average of $129,567, less than move-in ready REOs, short sales and non-distressed properties. However, the average price for damaged REOs has risen more than $30,000 since July while non-distressed property values are falling. Damaged REOs spent the least time on market of any property type, an average of 7.5 weeks.
Short sales, on the other hand, spent the longest on market, 17.5 weeks, and received an average of 3.1 offers. Forty-five percent of short sales were financed by FHA, which reflects their price and their popularity among first-time buyers. Sixty-one percent of first-time buyers used the FHA for their loans.
Agents, as you know we have been offering short sale training for years (and years) now. We were the first national coaching company to teach agents how to do short sales…and we are by far the largest. Thousands of agents have received their HREU CDPD* (Certified Distressed Property Designation). We have made it easy for you to learn everything you need to know to easily list and sell short sales. Watch the FREE Short Sale Secrets video and grab your FREE Short Sale Book. If you would like to go ahead and enroll now for only $97 call 1-866-422-9497 or sign up here.
The survey of 1500 real estate agents found that number of first-time buyers was easing as the deadline for the first-time buyer credit neared in October. The credit has since been extended until April 30 and expanded to include move-up buyers as well.
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Check the blog frequently this week….lots on new housing information…
Fannie Mae plans to raise minimum credit score requirements next month and limit the amount of overall debt that borrowers can carry relative to their incomes, The Washington Post reported on Thursday.
Starting Dec. 12, the automated system that the government-controlled mortgage finance company uses to approve loans will reject borrowers who have at least a 20 percent down payment but whose credit scores fall below 620 out of 850, the newspaper reported. Previously, the cut-off was 580.
Also, for borrowers with a 20 percent down payment, no more than 45 percent of their gross monthly income can go toward paying debts, the newspaper said.
Loans to people with credit scores below 620 fell seriously behind at a rate approximately nine times higher than other loans purchased in the same period, Fannie Mae spokesman Brian Faith said.
Loans taken out by borrowers with lots of debt also suffer higher levels of serious delinquency, he said.
“It’s not enough to help borrowers buy a home — we must also ensure that they can stay in the home over the long term,” Faith said in a statement to The Washington Post.
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Agents, I have a question for you…
What happens IF:
1) The ‘first time home buyer’ tax credit it not renewed?
2) Interest rates increase by…1+%?
3) Foreclosures INcrease…and the number of REO (bank owned) homes causes the inventory of unsold homes to double?
(4) FHA lending standards tighten..requiring more downpayments etc?)
If you are a HREU student…and you have been reading this blog….you already know that all 4 of those things are happening….and happening now.
Here is an article from Bloomberg.com. Not the complete article.
The recovering housing market may be heading for a relapse as President Barack Obama and Federal Reserve Chairman Ben S. Bernanke consider ending support for the source of the global financial crisis.
The Obama administration is studying whether to let a first-time home buyers’ tax credit expire as scheduled at the end of November. Bernanke and his Fed colleagues may continue talking this week about how to wind down purchases of mortgage- backed securities, according to Peter Hooper, chief economist at Deutsche Bank Securities Inc. in New York. The two programs have helped stabilize real-estate demand, with new-house sales rising 9.6 percent in July from the prior month, the most since 2005.
Many agents are in denial that the Fed would end this program….but, they will have to. Why? because if they continue the program it will become entitlement. The tax credit will go from being something that was meant to be a short term tool to a long term expectation. Remember cash-for-clunkers? That eneded. What happened to car sales post cash-for-clunkers? Car sales went back to the PRE-cash-for-clunkers levels. Will the same things happen with home sales?
“Things could get ugly,” said Lawler, an independent consultant in Leesburg, Virginia, who spent 22 years at Fannie Mae, a Washington, D.C.-based government-controlled mortgage- finance company. “We could be facing a triple whammy at the end of the year: the expiration of the tax credit, the end of the Fed mortgage-buying program and rising foreclosures.”
Major Test
This is the first major test of policy makers’ ability to coordinate exit strategies as they seek to wean the economy off government support, said Brian Bethune, chief financial economist of IHS Global Insight, a forecasting company in Lexington, Massachusetts.
They have already acted separately, with the administration ending its $3 billion “cash-for-clunkers” automobile trade-in program on Aug. 24 and the Fed starting to wind down its purchases of Treasury debt, which totaled $285.2 billion between March 25, when the initiative began, and Sept. 16.
The 55-year-old Bernanke and his colleagues, who meet tomorrow and Wednesday to map monetary strategy, discussed “tapering” off the Fed’s purchases of mortgage-backed securities and housing-agency debt at their last gathering in August, according to the minutes of that meeting. No decision was made by the central bank’s policy-making Federal Open Market Committee.
Translated: interest rates WILL increase.
Mortgage-Backed Securities
Under the current program, the Fed is scheduled to buy up to $1.25 trillion of mortgage-backed securities and $200 billion of agency debt by the end of the year. So far, it has purchased $862 billion of the former and $125 billion of the latter.
A trio of Fed presidents — Jeffrey Lacker of Richmond, James Bullard of St. Louis and Dennis Lockhart of Atlanta — has publicly raised the possibility the central bank might not spend all the money authorized for the mortgage-backed securities. Lacker questioned whether the economy needs the additional stimulus in an Aug. 27 speech.
New York Fed President William Dudley, who is vice chairman of the FOMC, has sounded more cautious.
“The market expects us to complete these programs,” he said Aug 31. “To contradict that market expectation is a pretty high hurdle.”
We expect to see rate increase to 5.5%-6% if the Fed pulls back. People are buying homes because owning is a better financial proposition vs renting. If rates increase that rationalization will go away. With the probability of short term appreciation it will be difficult to rationalize paying more for a home vs saving money and renting.
Abrupt Stop
An abrupt stop might push up mortgage rates by a half to one percentage point, said Hooper, a former Fed official. Tapering off — by reducing weekly purchases and stretching them beyond the end of the year — would have a more muted effect, pushing rates up by at least a quarter percentage point, he said, adding that the Fed may announce just such a strategy after its meeting this week.
Mortgage rates for 30-year fixed home loans averaged 5.04 percent in the week ended Sept. 17, down from 5.07 percent the previous week, according to McLean, Virginia-based Freddie Mac, a government-controlled mortgage-finance company.
Borrowing costs for home buyers are relatively high based on the historical relationship with the Fed’s target rate for overnight loans between banks, currently at zero to 0.25 percent.
Crucial Extension
A number of Washington-based organizations — the National Association of Home Builders, the National Association of Realtors and the Mortgage Bankers Association — say an extension of the buyer’s tax credit is also crucial.
Lawrence Yun, chief economist of the realtors’ group, estimates that about 350,000 home sales through August were directly attributable to the tax credit of up to $8,000 for first-time buyers. People buying their first homes accounted for 43 percent of sales since the credit became law, up from 32 percent in the six weeks prior to its passage, according to Washington-based Campbell Communications Inc.
Yes, the credit did motivate buyers to buy. Bo doubt.
But, we hear from students everyday about their ‘first time buyers’ having to overpay for homes because they are competing with ‘investors’ and other first time buyers. So, part of their motivation to buy was to get the tax credit ($8000 bonus for buying a home) and yet they end up overpaying for the home….by usually far more than the tax credit. At the end of the day, wouldn’t it of been better for the buyer to have bought the home at a better..lower price?
Treasury Secretary Timothy Geithner, 48, called signs of stabilization in the U.S. housing market “very encouraging” and told reporters on Sept. 17 that the Obama administration will take a “careful look” at extending the credit.
‘Slim’ Chances?
Congress may not pass an extension; the chances “seem slim,” said Mark Calabria, director of financial-regulation studies at the Cato Institute in Washington and a former staffer on the Senate Banking Committee. Public opposition to increasing the federal budget deficit is high, and there’s little appetite on Capitol Hill for finding spending cuts to offset the cost of the tax credit, he said.
Agents, you need to call ALL of your buyer leads and let them know that they better buy…and buy fast…if they expect to get the credit. If they are motivated to buy because of the credit..let them know that it probably won’t be extended and…and many are speculating….won’t be increased!
The deficit will total $1.6 trillion this year as revenue falls and the government spends at the fastest pace in 57 years, according to the nonpartisan Congressional Budget Office.
In a sign of the public’s concern about the deficit, 62 percent of people surveyed in a Sept. 10-14 Bloomberg News poll said they would be willing to risk a longer-lasting recession to avoid more government spending.
That is an interesting stat. In my mind, a hopeful stat. People are willing to overcome some short term ‘pain’ (continued recession) for long term gain (healthier economy).
The impact of terminating the tax credit will show up first in the new-home market, said David Crowe, chief economist of the home-builders’ association.
“It takes at least four months to build a house, and you need to buy it before Dec. 1 to qualify,” he said. “If you haven’t started building it by now, it’s too late.”
Recovery Signs
To be sure, some economists are betting the housing recovery is here to stay. The market has “clearly bottomed,” said Dean Maki, chief U.S. economist for Barclays Capital in New York.
Even some of the optimists are hedging their bets given how dependent the market has been on government and central bank support.
“I’m right in there with the rest of the cheerleaders, but there are no historical anecdotes, no historical data points to use for this,” said Lewis Ranieri, the 62-year-old mortgage- bond pioneer who is chairman of New York-based Hyperion Partners LP. The U.S. housing market is “still very fragile.”
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Home Values Going Down The Drain.
For those of you who think the markets have in any way reached bottom please read this article from the Washington Post:
A growing number of American homeowners are falling into financial limbo: They’re badly behind on payments, but their banks have not yet foreclosed.
The backlog of seriously delinquent mortgages, which so far affects about 1 million borrowers, is a shadow over hopes for a rebound in the nation’s housing markets. It masks the full extent of the foreclosure crisis and threatens to depress prices even further just as some parts of the country are hinting at recovery. For lenders, it could portend even more financial losses tied to the mortgage meltdown.
“It just means foreclosure rates are going to keep rising,” said Patrick Newport, an economist for IHS Global Insight.
Rising mortgage delinquencies were at the root of the recession, and many economists say an economic recovery will be difficult until the housing market recovers and home prices stabilize.
And how bad is the problem….
During the first quarter of this year, the share of all homeowners seriously delinquent on their mortgage but not yet facing foreclosure more than doubled to 3.04 percent, or about $227 billion in loans. There was a total of $97 billion in such loans during the same period in 2008, according to Inside Mortgage Finance. In more prosperous times, the rate is much lower — it was less than 1 percent in the first quarter of 2007, according to the industry publication.
We are hearing that in areas like Las Vegas there are 30,000 REOs coming on the market….in the next 3-6 months!
Some of the backlog reflects the inability of lenders to keep up with the swelling rolls of delinquent properties.
And the question that everyone wants to know….how long will this foreclosure (REO Listing and Short Sale Listing) dominated market last….
The glut of foreclosed homes on the market has already pushed down prices across the country. Existing-home prices fell another 16.8 percent in May compared with a year ago, according to industry data released yesterday. The overhang of homes in limbo means that foreclosure rates are likely to increase dramatically during the second half of this year and into 2010 as lenders work through the backlog, said Bob Bellack, chairman of Zetabid, which auctions foreclosed properties.
Why is the foreclosure process taking soooooo long?
In better times, lenders tended to begin the foreclosure process after three months, said Guy Cecala, publisher of Inside Mortgage Finance. Now it is not unusual for it to take nine months for the process to begin, he said.
“No one is in a rush, lender-wise, to deal with the property,” he said. “If you have to sell at a loss, why rush?”
Lenders traditionally write down the value of the home six months after an owner stops making payments, but the total loss is not recorded until the property is sold in foreclosure, said Mark Zandi, chief economist of Moody’s Economy.com.
Agents, remember you CAN help someone even when they are missing payments. Lenders WANT TO avoid foreclosure. The last thing the lenders want in this housing market is another REO. Learn how to do short sales. Expect the new ’solutions to the housing crisis’ coming out of Washington to focus on Mortgage Loan Mods and Short Sales.
Even seriously delinquent borrowers can restart negotiations with lenders to stay in their homes with a modified mortgage or persuade them to accept a short sale, which involves a homeowner selling the property for less than the outstanding mortgage balance and then turning the proceeds over to the lender to satisfy the loan.
Jay Brinkmann, chief economist for the Mortgage Bankers Association, said his industry is doing its best to work through the backlog while carrying out federal foreclosure prevention programs. “If a lender has a house that they know they will have to sell eventually,” he said, “they almost always want to sell it as quickly as possible because of the interest cost of holding the loan on the books, in addition to costs like taxes, keeping the grass cut and other maintenance.”
So, what do you do with all of this information? (Warning, shameless pitch coming)…Learn how to do Easily List Short Sales and Become a REO Listing Agent. Really, what choice do you have in this market?
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James L Butkiewicz
At the dawn of the 20th century, fewer than half of all households in the United States owned their own home. Fueled by rapid income growth during the 1920s, home ownership increased to 47.8% in 1930 from 46.5% in 1900 but then declined to 43.6% in 1940.
An obstacle to homeownership at that time was the extant system of mortgage finance. Mortgage loans were supplied by mortgage bankers and savings and loan companies. Mortgage bankers financed their loans by selling bonds, generally to insurance companies, but also sold mortgage participation bonds to individuals during the 1920s. Savings and loans’ deposits were used almost exclusively to make mortgage loans.
First mortgages were typically short-term loans of often three to five years and for no more than 50% of the value of the property. Interest rates were variable, and only interest was paid during the term of the loan; there was no amortization. A balloon repayment of the principal or refinancing was required when the loan matured. Many borrowers obtained second and even third mortgages to finance their housing purchases.
A housing boom during the 1920s was accompanied by rapid appreciation of house prices. However, the subsequent housing and economic bust created problems for homeowners. Loss of employment made refinancing mortgages difficult. House price deflation forced foreclosures, primarily by the issuers of second and third mortgages who saw the value of their liens eroded by deflation.
Reform of mortgage finance and ending the loss of homes were the intended results of numerous legislative acts during the 1930s. A significant reform was the 1933 creation of the Home Owners Loan Corporation. This agency forestalled foreclosures for middle- and lower-income homeowners. The HOLC was financed by the sale of government-guaranteed bonds. It acquired mortgages that were in default and converted them to long-term, generally 20-year, loans with monthly payments of interest and principal at fixed rates of interest.
Although it stopped lending in 1935, the institution of the long-term, fully amortized, fixed-interest-rate mortgage dramatically altered mortgage finance, significantly contributing to the growth in homeownership following World War II.
The creation of the Federal Housing Administration in 1934 was intended to make the government’s mortgages marketable. The FHA insured the long-term, fixed-rate mortgages to facilitate the flow of funds into mortgage finance. The FHA initially insured mortgages up to 80% of the property value, a much higher loan-to-value ratio than previously allowed for first mortgages.
However, financial institutions were not aggressive purchasers of FHA-insured mortgages, so the Federal National Mortgage Association was formed in 1938 to create a market for FHA and later Veteran Administration mortgages.
Creation of the Federal Savings and Loan Insurance Corporation in 1934, insuring deposits in savings and loan companies, benefited mortgage finance since deposits in savings and loans, the primary mortgage lenders, were fully guaranteed by the federal government.
Another 1930s regulation was Regulation Q. First applicable to commercial banks, this regulation prohibited the payment of interest on checking deposits and capped the rates of interest payable on savings deposits and certificates. This regulation was extended to savings and loans and savings banks in 1966. However, these thrift institutions were provided a competitive advantage by being allowed to pay one-quarter percent more (25 basis points) on savings instruments than commercial banks.
Deposit insurance and interest rate regulations allowed savings institutions to make mortgage loans at relatively low rates of interest, thereby subsidizing homeownership. However, the competitive benefits of regulation Q were quickly undermined by rising inflation, weakening the finances of savings institutions and eventually resulting in the savings and loan crisis.
The 1930s reforms of mortgage finance resulted in an increase of homeownership to 63% of households by 1970. Subsequent innovations, such as securitization, further increased the homeownership rate to 66% by 2000. However, more recent financial innovations, which increased homeownership to 69% of households in 2005, revived past practices and created new ones that recreated the instability in mortgage finance that existed prior to the 1930s reforms. These include increased reliance on adjustable rate mortgages, interest-only loans and even negative amortization loans. Payments for this last loan type do not cover monthly interest charges, so principal increases monthly, requiring refinancing when certain loan-to-value limits are attained, and thereby increasing monthly payments on the new, higher-valued loan.
Historically, the housing cycle is a primary component of any business cycle, with the current crisis being one of the worst cases. Past reforms of mortgage finance generally sought to increase homeownership and stabilize the housing cycle, and with it the business cycle. However, recent practice has undermined many of these reforms. Certainly new financial reforms and regulations are forthcoming. The objectives should be making homeownership feasible for those who can afford it and to stabilize the housing market to minimize economic fluctuations.
James L. Butkiewicz is a professor of economics at the University of Delaware, where he specializes in the Great Depression.
SOURCE: Forbes.com
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Realtors, You are going to love this….
Harris Real Estate University
Not only will ALL home buyers get a $15,000 tax credit but now……THE FHA IS MAKING IT EASIER TO GET A LOAN!
Here are the important elements of the FHA lender requirements:
1) With 20%+ down someone can buy a house with LESS THAN A 580 CREDIT SCORE!
2) Only 1 pay stub is now required.
3) In some cases….NO APPRAISALS.
4) “Steamlined” process.
Feb. 5 (Bloomberg) — Fannie Mae, the mortgage-finance company under U.S. government control, will loosen rules for homeowners seeking to lower their loan payments by refinancing.
Fannie Mae will drop some credit-score requirements, reduce income-documentation standards and waive the need for appraisals in some cases, according to a notice yesterday to lenders posted on the Washington-based company’s Web site. The changes apply to loans that the company owns or guarantees.
The company, which accounts for more than 40 percent of the $12 trillion in U.S. residential mortgage debt, is seeking to break a “logjam” in refinancing and allow more homeowners to take advantage of near-record low interest rates, according to Brian Faith, a Fannie Mae spokesman. The increased flexibility for consumers isn’t large enough to significantly harm mortgage- bond investors and mortgage insurers, analysts said.
“This is not yet the no-appraisal refi wave that many have feared,” Matt Jozoff and Brian Ye, mortgage-bond analysts at New York-based JPMorgan Chase & Co., wrote in note to clients yesterday.
Fannie Mae’s appraisal change doesn’t mean borrowers with less than 20 percent home equity can forgo mortgage insurance, the analysts said. That’s because Fannie Mae will likely use automated models to check home values listed on applications before offering to waive appraisals, the analysts said.
The company’s DU Refi Plus program will start April 4.
Aiding Borrowers
“To allow more borrowers to take advantage of today’s historically low interest rates and help the lending community break the logjam in mortgage refinancing, the company is extending its refinance offerings,” Faith said in an e-mailed statement. The program “will streamline” refinancing “for potentially millions of current mortgage holders,” he said.
While Fannie Mae, smaller rival Freddie Mac and the companies’ regulator are considering permitting borrowers to refinance even when the consumers owe more than their homes’ worth, they also must consider “the various hurdles and unintended consequences,” Federal Housing Finance Agency Director James Lockhart said in a Feb. 2 interview.
Fannie Mae’s changes will include allowing borrowers seeking to take out a loan that is 80 percent of the value of the home or less to qualify for refinancing with credit scores below its 580 minimum. Consumer credit scores as measured by Fair Isaac Corp. range from 300 to 850.
Easing Documentation
The program also lowers income-documentation requirements to one current pay stub, according to the notice.
The U.S. took control of Fannie Mae and McLean, Virginia- based Freddie Mac in September as their losses threatened to further roil the housing market. The government agreed to inject as much as $200 billion of capital to protect investors in their roughly $6 trillion of corporate debt and mortgage bonds.
The average rate on a typical 30-year fixed mortgage rose to 5.25 percent in the week ended today, according to Freddie Mac. Rates are up from 4.96 percent three weeks ago, a record low, and down from 6.46 percent in the last week of October.
Under their government charters, the companies must have borrowers or lenders buy mortgage insurance or other forms of so- called credit enhancement if their down payments or home equity are less than 20 percent. Mortgage insurers cover all or some of lenders’ losses on defaulted debt.
Mortgage-bond holders who paid more than face value for the debt may incur losses if refinancing means the securities are repaid faster than expected, cutting the value of the premium coupons on the bonds. More than 95 percent of Fannie Mae or Freddie Mac-guaranteed fixed-rate mortgage securities are trading above face value, according to Bloomberg data.
Unfounded Concerns
“Absurd” concern about faster prepayments being potentially enabled by quick Fannie Mae and Freddie Mac policy changes can be seen in the only about 1-percentage-point gap between prices for Fannie Mae’s 4.5 percent and 5 percent mortgage bonds, Ken Hackel, head of fixed-income strategy at RBS Greenwich Capital Markets, wrote to clients today.
Fannie Mae’s changes are “unlikely to have a material effect on prepayments,” Laurie Goodman, a senior managing director at Austin, Texas-based Amherst Securities Group LP, wrote in a report today. Derek Chen and Nicholas Strand, Barclays Capital mortgage-bond analysts in New York, agreed.
“We think the overall impact on borrower refinance-ability and prepayments is marginal,” they wrote in a note to clients.
While lenders won’t be required to make contractual promises about the value or condition of homes under Fannie Mae’s Refi Plus program, they will still be required to represent that all data submitted to the company’s computer underwriting program are accurate, according to the notice.
Faith said that the company will “expedite the refinancing process for Fannie Mae-owned loans by, under certain conditions, leveraging our automated risk assessment capabilities to validate the current market values in lieu of traditional appraisal or property inspection requirements.”
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