Fannie Mae is about to roll out a new underwriting system that will address some concerns about layered risk that cropped up after it raised its maximum debt-to-income ratio.
When Desktop Underwriter 10.2 is rolled out March 17, it "will include an adjustment to the DU credit risk assessment," Fannie confirmed in a recent email to sellers.
When Fannie
But, after examining the loans it received since last year's DU update, Fannie decided to implement some "fine tuning" that would limit that risk layering.
Fannie also is putting some new restrictions on
While Fannie is putting more restrictions on risk layering and PIWs in the new version of DU, it also is loosening certain underwriting requirements associated with HomeStyle renovation mortgages. Limits for allowable LTVs, combined LTVs and high CLTVs will be increased to 97% for certain one-unit purchase loans and cash-out refinances involving principal residences.
Manufactured housing properties also will be eligible for HomeStyle loans, with renovation funds limited to the lesser of $50,000 or 50% of the appraised value after the project after completion.
Fannie on March 17 also will retire DU 10.0 and disallow resubmission of loans from the older version of its AU system.