05/06/2021
All policy changes and updates are referenced below to the appropriate section of the CLG. These policy changes are effective 05/06/2021 unless otherwise noted.
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CBCMA has compiled all of its announcements related to COVID-19 into one section immediately following the Recent Updates and Announcements section of the Correspondent Lending Guide.
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To review the program guidelines changes made April 23, 2021, or earlier, please follow this link to the archived Correspondent Lending Guides.
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COVID Announcement 20-22: This section was reworded to the following.
CBCMA will not purchase loans that are in forbearance; if a loan is determined to be in forbearance after purchase, the correspondent will be required to repurchase the loan. This includes if, after CBCMA has purchased the loan but before servicing rights are transferred, the correspondent authorizes a forbearance agreement without coordinating with CBCMA. To coordinate forbearance agreements, please reach out to servicing@chenoafund.org.
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5.12 (Undisclosed Debt Monitoring and Soft-Pull Credit Refreshes): It was clarified that a soft-pull credit refresh, or a UDM, must happen within 10 calendar days of the Note date. This affects two paragraphs within the section:
All Conventional Programs: All borrowers must have at least one credit score. CBCMA will require a tri-merge/three-bureau soft-pull credit refresh dated within ten (10) calendar days of the Note date OR evidence of enrollment in a UDM (Undisclosed Debt Monitoring) program that pulls from all three bureaus through the aforementioned ten-day time period.
All FHA Programs: All borrowers must have at least one credit score. To be sure that there is no new adverse credit activity, new debt, or material inquiries, CBCMA requires a soft-pull credit report from all three bureaus, OR a UDM (Undisclosed Debt Monitoring) report from at least one credit bureau, within ten (10) calendar days of the Note date. CBCMA highly recommends correspondents utilize the UDM option, with the intent to emphasize debt monitoring services that checks for new debt or material inquiries. While soft pull credit reports are acceptable, they may disclose additional information that may require an update to the AUS.
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5.17 (Present Housing Expense & Verification of Housing Payment): This section requires an explanation to be noted in the comments section of the 92900-LT if the borrower has no current housing payment. This requirement now only applies to borrowers in the 620–639 FICO band:
For any borrowers in the 620–639 FICO band not making a present housing payment, a verification of housing payment will be required to be completed by the landlord or homeowner which must document that no rent is past due. An explanation for the rent-free arrangement should be noted in the comments section of the 92900-LT by the underwriter. This is in addition to the requirements in section 5.16.
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5.34.13 (Current Housing Payment): This section has been moved to be a sub-section to section 5.17 (the above). In addition, the requirement for a letter of explanation has been restricted to borrowers in the 620–639 FICO bucket. Here is the revised section 5.17.1 (Current Housing Payment):
All Programs: All applications must contain a “present” housing payment unless the borrower is currently not making a housing payment. The amount “$0.00” should be entered into the “present” housing payment field on the loan application if the borrower is not making a housing payment; in addition, the file must contain a Letter of Explanation from the borrower to specifically address their housing situation if the borrower has a FICO score of 620–639.
The “present” housing payment field may only be left blank if your LOS does not allow an entry of “$0.00.”
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A new section has been added, 5.38 (State-specific Guidance). Sub-section 5.34.15 (Alaska and South Carolina) has been moved under this section, renumbered 5.38.1, and slightly revised:
All Programs: In Alaska and South Carolina the minimum second mortgage loan amount is $5,000. Therefore, for purchase prices below $143,800 with 3.5% assistance, or $100,000 with 5% assistance, the DPA amount will be $5,000 in those states.
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An additional sub-section, 5.38.2 (North Carolina), has been added. Its text reads:
All Programs: In North Carolina, if there are no fees charged in the origination section of the CD (Section A) other than the origination fee then lenders may exceed the 1.5% origination fee cap. Loans must comply with QM guidelines (i.e. the 3% points and fees test).
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Finally, an additional sub-section, 5.38.3 (New York), has been added. Its text reads:
All Programs: Chenoa Fund is not offered in the state of New York.