Written By: Glenn Michaels
When underwriting FHA mortgage loans you must first determine what “effective” income is. FHA requires all borrowers to show a minimum of two years of employment. There are exceptions to the rule.
Opinion-Editorial (Op-Ed) Disclaimer For NAMP® Library Articles: The views and opinions expressed in the NAMP® Library articles are those of the authors and do not necessarily reflect any official NAMP® policy or position. Examples of analysis performed within this article are only examples. They should not be utilized in real-world application as they are based only on very limited and dated open source information. Assumptions made within the analysis are not reflective of the position of NAMP®. Nothing contained in this article should be considered legal advice.
Written By: Glenn Michaels
Last week I received a file to underwrite where the borrower’s tax return indicated that he earned more than 1.6 million in income. The Mortgage Loan Officer and the mortgage loan processor calculated the ratios based on the same income. The ratios were 2% over 4% and it was a slam dunk deal.as far as they were concerned.
Opinion-Editorial (Op-Ed) Disclaimer For NAMP® Library Articles: The views and opinions expressed in the NAMP® Library articles are those of the authors and do not necessarily reflect any official NAMP® policy or position. Examples of analysis performed within this article are only examples. They should not be utilized in real-world application as they are based only on very limited and dated open source information. Assumptions made within the analysis are not reflective of the position of NAMP®. Nothing contained in this article should be considered legal advice.
Written By: NAMP® Op-Ed Ghost Writer
Although the automated underwriting system provides guidance on loan analysis, it is critical to hone your guideline reviewing skills. Underwriting guidelines contain critical definitions, clarifications, and rules that must be applied on all loans. In some cases, the AUS will refer to the guidelines for the full list of requirements to address a particular loan characteristic. As a result, let’s review some best practices for using guidelines.
Opinion-Editorial (Op-Ed) Disclaimer For NAMP® Library Articles: The views and opinions expressed in the NAMP® Library articles are those of the authors and do not necessarily reflect any official NAMP® policy or position. Examples of analysis performed within this article are only examples. They should not be utilized in real-world application as they are based only on very limited and dated open source information. Assumptions made within the analysis are not reflective of the position of NAMP®. Nothing contained in this article should be considered legal advice.
Written By: NAMP® Op-Ed Ghost Writer
The busy season in the mortgage industry is fast approaching! Soon, the weather will break and homebuyers will come out of hibernation to begin searching for their next home. As a result, this is a good time to think about some best practices for maximizing productivity and efficiency. Time management is one of the most critical of these practices.
Opinion-Editorial (Op-Ed) Disclaimer For NAMP® Library Articles: The views and opinions expressed in the NAMP® Library articles are those of the authors and do not necessarily reflect any official NAMP® policy or position. Examples of analysis performed within this article are only examples. They should not be utilized in real-world application as they are based only on very limited and dated open source information. Assumptions made within the analysis are not reflective of the position of NAMP®. Nothing contained in this article should be considered legal advice.
Written By: Glenn Michaels
All mortgage loan programs except for Streamline Refinance Programs require the borrower’s Internal Revenue Service (IRS) tax forms that were filed for at least the last or the last two years. If a borrower was self – employed we not only need the borrower’s personal tax returns we also need the most recent two years of business returns.
Opinion-Editorial (Op-Ed) Disclaimer For NAMP® Library Articles: The views and opinions expressed in the NAMP® Library articles are those of the authors and do not necessarily reflect any official NAMP® policy or position. Examples of analysis performed within this article are only examples. They should not be utilized in real-world application as they are based only on very limited and dated open source information. Assumptions made within the analysis are not reflective of the position of NAMP®. Nothing contained in this article should be considered legal advice.
Written By: NAMP® Op-Ed Ghost Writer
Most underwriters and processors have the basics of calculating income down to a science. The hourly, bi-weekly, semi-monthly, and annual calculations are second nature to those of us who calculate income every day. As a result, many processors and underwriters will manually execute their calculations on an underwriting or processing worksheet. Many underwriters will also type their calculation on their underwriting transmittal. However, there are some drawbacks to manual calculations that an income calculation worksheet can overcome.
Opinion-Editorial (Op-Ed) Disclaimer For NAMP® Library Articles: The views and opinions expressed in the NAMP® Library articles are those of the authors and do not necessarily reflect any official NAMP® policy or position. Examples of analysis performed within this article are only examples. They should not be utilized in real-world application as they are based only on very limited and dated open source information. Assumptions made within the analysis are not reflective of the position of NAMP®. Nothing contained in this article should be considered legal advice.
Written By: Glenn Michaels
Borrowers have all kinds of income. Most have traditional income with a periodic pay stub and a W – 2 a long with a IRS form 1040 in order to determine the income and to verify the income. The self – employed borrowers have the appropriate tax documents to determine and verify their income.
Opinion-Editorial (Op-Ed) Disclaimer For NAMP® Library Articles: The views and opinions expressed in the NAMP® Library articles are those of the authors and do not necessarily reflect any official NAMP® policy or position. Examples of analysis performed within this article are only examples. They should not be utilized in real-world application as they are based only on very limited and dated open source information. Assumptions made within the analysis are not reflective of the position of NAMP®. Nothing contained in this article should be considered legal advice.
Written By: Glenn Michaels
Appraiser’s when completing an appraisal report now place on every appraisal report the “Quality Ratings” on every appraisal report. These ratings are numbered after the “Q”. They can be from Q1 through Q6. The underwriter should make notice of the Quality Rating as well as the Condition Rating (C1 – C6)
Opinion-Editorial (Op-Ed) Disclaimer For NAMP® Library Articles: The views and opinions expressed in the NAMP® Library articles are those of the authors and do not necessarily reflect any official NAMP® policy or position. Examples of analysis performed within this article are only examples. They should not be utilized in real-world application as they are based only on very limited and dated open source information. Assumptions made within the analysis are not reflective of the position of NAMP®. Nothing contained in this article should be considered legal advice.
Written By: Glenn Michaels
All underwriters must review the appraisal report for each and every transaction that is being underwritten. The underwriter’s must take notice of the rating codes found in the Marketing Approach of each appraisal report. Failure to make notice of the code could result in a mortgage loan file not being purchases.
Opinion-Editorial (Op-Ed) Disclaimer For NAMP® Library Articles: The views and opinions expressed in the NAMP® Library articles are those of the authors and do not necessarily reflect any official NAMP® policy or position. Examples of analysis performed within this article are only examples. They should not be utilized in real-world application as they are based only on very limited and dated open source information. Assumptions made within the analysis are not reflective of the position of NAMP®. Nothing contained in this article should be considered legal advice.
Written By: Glenn Michaels
The FHA permits only one FHA mortgage at a time for a borrower except for four (4) exceptions.
Opinion-Editorial (Op-Ed) Disclaimer For NAMP® Library Articles: The views and opinions expressed in the NAMP® Library articles are those of the authors and do not necessarily reflect any official NAMP® policy or position. Examples of analysis performed within this article are only examples. They should not be utilized in real-world application as they are based only on very limited and dated open source information. Assumptions made within the analysis are not reflective of the position of NAMP®. Nothing contained in this article should be considered legal advice.
Written By: Bonnie Wildt
I have said it before and I will say it again and that is, do not believe everything you hear or read for that matter. In this particular instance I am referring to AUS Findings. I have had countless conversations with processors and loan officer who want to know why I am asking for documentation that the AUS findings have clearly stated wasn’t needed or worse, they can’t believe I am turning a loan down that has an Approve/Eligible. So here it is again and pay particular attention to the details because just because you have an Approve/Eligible or Accept doesn’t necessarily mean you have a done deal.