Agency Super Conforming (Jumbo) Fixed Rates & Arms

Eligibility Guidelines

PROGRAM DESCRIPTION

This is a full documentation program to be used for the origination of Agency Super Conforming loans available as a result of the Home Economic Recovery Act (HERA) of 2008 for Desktop Underwriter (DU) underwritten loans. The new loan amounts are applicable to high cost areas only. The loan amounts are applicable to high cost areas only as determined by the Federal Housing Finance Agency (FHFA). The loan amounts must be greater than the current maximum Conventional Conforming Loan Limits and may not exceed the High Cost Loan Limit established by FHFA.

AVAILABLE MARKETS

Markets as determined by FHFA based on the High-Cost Area Provisions of HERA
Refer to: https://www.efanniemae.com/sf/refmaterials/loanlimits/
Users are responsible for ensuring that individual mortgage loans do not exceed maximum loan limits.

AVAILABLE PRODUCTS

Fixed Rate Fully Amortizing: 30-Year and 15-year (10-30-year terms available)
Fixed Rate Interest Only: 30-Year (10/20)
LIBOR ARM Fully Amortizing: 5/1, 7/1 and 10/1
LIBOR ARM Interest Only: 5/1, 7/1 and 10/1

Additional requirements for interest only loans:

Must be 1-unit property
An Approve/Eligible recommendation is required
Minimum FICO score of 720 required.
Cash-out is not permitted.
Convertible ARM loans are not permitted.
3-4 unit investment properties not allowed.

LOAN PURPOSE

Purchase
Rate/Term Refinance
Cash Out Refinance (Primary Residence only);
Note: Cash-Out Refinance transactions are not permitted for interest only products, or on investment properties or second homes. Cash-out requires a full appraisal

PROPERTY TYPE

1-Unit (including Condominiums, Co-ops & PUDs)
2-4 Unit

OCCUPANCY

Primary Residence
Second Home
Investment Property (Co-ops and Florida properties not permitted; 1-2 unit for I/O products)

MAXIMUM LOAN AMOUNT AND COUNTY ELIGIBILITY

Refer to the following link to determine maximum loan amount and county eligibility:
https://www.efanniemae.com/sf/refmaterials/loanlimits/
The maximum Agency Jumbo loan amount is based on the property location (by city/county) and the number of units. In addition, Jumbo Agency maximum loan amounts are determined by high cost areas and are above the general conforming loan amounts.

LTV/CLTV/HCLTV

The following LTV/CLTV/HCLTV and score requirements apply to both Permanent and Temporary High Cost loan amounts unless noted otherwise.

Notes:

1-unit includes condos, PUDs, and co-ops.
Florida: Condos are restricted to 60%/60%/60%; no investment property.
All borrowers must have a valid FICO score.
MI Restrictions: Refer to the individual MI Company Policy for LTV/FICO, loan size, and Underwriting Policy limitations. MI Policy is subject to change at all times and cannot be fully reflected within the Program and Product Descriptions due to variances between companies.
DU Expanded Approvals not permitted
Cash-out not permitted for interest only products, or if property was purchased within the prior 6 months.
If property was listed for sale in the past 6 months, LTV for Cash-Out Refinance may not exceed 60%.
Loans must meet the Continuity of Obligation policy.

The LTV and/or FICO score requirement may differ depending upon the loan characteristics. The more conservative requirement will always apply. Loan characteristics include (but are not limited to) the following:

Bankruptcy/Foreclosure/Deed-in-Lieu Policy

Seasoning & Listing Policies
Continuity of Obligation Policy

SUBORDINATE FINANCING

This program is eligible for subordinate financing
Employer Assisted Housing Program loans are permitted.

MORTGAGE INSURANCE

Standard MI coverage applies as stated in the appropriate product/program fact sheet.

INELIGIBLE TRANSACTIONS

Loan does not meet the credit score, LTV, or loan amount guidelines
DU Refer findings on Interest Only Products
DU Refer with Caution findings
Fannie Mae Flexible Mortgage
MyCommunityMortgage
DU Expanded Approval
Borrowers with no FICO score
Loan transaction is not eligible for mortgage insurance
Community Lending, FHA, or VA products and programs.
Community Seconds
Co-op Investment properties
All products or programs not shown as eligible
Non-permanent resident alien (NPRA)
Investment properties in Florida

ELIGIBLE UNDERWRITING METHODS AND FINDINGS

DU Approve/Eligible
DU Approve/Ineligible, only if:
Loan Amounts > Permanent High Cost Amount: The loan amount exceeds the current loan limit applied by DU (i.e., the permanent high-cost limit for the area in which the property is located). The loan amount cannot exceed the temporary high-cost limit applicable to the area in which the property is located.
Co-op Properties with subordinate financing and/or an interest only product are acceptable as long as the loan meets the parameters applicable for co-ops that are contained in this fact sheet.

INELIGIBLE FINDINGS

DU Expanded Approval
DU Refer/Eligible: Desktop Underwriter (DU) Refer decisions will automatically revert to a manual underwrite.
DU Approve/Ineligible (Co-op Properties with subordinate financing and/or an interest only product are acceptable as long as the loan meets the parameters applicable for co-ops that are contained herein.)
DU Refer/Ineligible
DU Refer with Caution

INELIGIBLE CREDIT SCENARIOS

Mortgage/Rental Delinquency: More than 0x60 days late on any mortgage or rental payment within the last 12 months
Non-traditional credit: All loans must meet the minimum Credit Score requirements
Bankruptcy/Foreclosure
Lawsuit: Borrower is party to a lawsuit

Credit Score

All borrowers must have a valid FICO score.
FICO scores below 720 are not permitted for interest only products.
The mortgage insurance company may have a higher score requirement.

Authorized Users of Credit

If the DU approval is based on authorized user account trade lines, lender must confirm these accounts accurately reflect the borrower's credit history.

Deed-in-Lieu/ Short Sale / Pre-Foreclosure

The underwriter must determine if there is a pre-foreclosure or short sale during their review of the credit report The gross monthly rent for each unit must be documented in each loan, even when the borrower is not utilizing rental income to qualify.
For all investment properties AND all 2-4 unit primary residences, when rental income is not used to qualify, the gross monthly rental income for each unit must be documented with one of the following:

Current Lease Agreement(s), or

Form 216: Operating Income Statement for investment and 2-4 unit owner occupied properties (including those in which the borrower occupies one of the units as a principal residence), or
Form 1007: A Single Family Comparable Rent Schedule for one-unit investment properties, or
Small Residential Income Property Appraisal Report (Form 1025)

TOTAL DEBT RATIO

Determined by DU.

ASSET DOCUMENTATION:

Determined by DU.
Reserves cannot be funded by employer-assisted housing benefits in the form of an unsecured loan.

Borrower Contribution Requirements

As per DU Requirements

Reserves

As per DU Requirements Note: 24 months PITIA reserves are required if the product is interest only.

Second Homes and Investment Properties, Multiple Properties

For second home and investment property transactions when the borrower has more than one financed residential property, including the subject property, additional underwriting and reserve requirements apply.

Assets/ Funds to Close

As per DU Requirements

Assets/ Source of Funds

Assets must be liquid, calculated, and documented.

Interested Party Contributions

As per DU Requirements

APPRAISAL

The appraisal format recommended by DU may be used, except for the following:
Co-op: Form 1075 with a full interior and exterior inspection is required for a co-op. Form 2095 is permitted with Approve/Eligible findings only If the LTV is > 80%, refer to the MI company requirements for appraisals.
Full interior/exterior inspection appraisals are required for all cash-out refinances, regardless of the DU Findings.

Field Review: A Field Review (One-Unit Residential Appraisal Field Review Report) is required if:

The loan amount is > $625,500 and the LTV, CLTV, or HCLTV is greater than 80%; or
The property is valued at $1,000,000 or more and the LTV, CLTV, or HCLTV is greater than 75%.

CONDO/PUD/CO-OP

For properties in attached condominium projects, the appraisal must contain two comparable sales from projects outside of the subject project in addition to the current comparable sale requirements.
For LTVs > 80%, project must also meet the project requirements of the MI company.