CONVENTIONAL

*MUST RECEIVE AN AUS APPROVE/ACCEPT/ELIGIBLE, INCLUDING THOSE WITH EXTENUATING CIRCUMSTANCES
Previous Loan Modification
Refinance:
• Fannie Mae/Freddie Mac: Permitted with previous modification (restructured mortgage to adjust the principal balance) provided the credit worthiness of the borrower and LTV are acceptable.

Purchase:
• Fannie Mae/Freddie Mac: Acceptable with both agencies, qualification based on payment history and remaining underwriting considerations.

Payment History:
A borrower must have completed their Trial Period Plan to qualify for either a refinance or purchase.
• A Trial Period Plan is a temporary forbearance plan that sets forth in a written notice those terms and conditions which the borrower must comply with during the trial period in order to obtain a permanent modification.
• The Trial Period is normally a 3-to-6-month period during which the borrower makes payments that are an estimate of the anticipated modified payment amount, as one of the preconditions to modification. For borrowers in bankruptcy, the Trial Period may be extended up to an additional 2 months.

Foreclosure
Home was given to the bank – No owner participation.
• 7 years from the date foreclosure completed and transferred back to the bank if they had NO extenuating circumstances.
• Fannie Mae Only*: 3 years from the date foreclosure completed and transferred back to the bank with acceptable extenuating circumstances (1) AND 10% Down Payment. Primary home purchase and rate/term refinances only. Non-owner occupied and second homes not allowed.
• Freddie Mac Only – When a loan receives an Accept risk classification, the loan does not need to be reviewed for waiting period requirements.
Essent and NMI will follow this guidance however Arch MI will not and still requires verification that waiting periods are met.

Short Sale, Deed in Lieu of Foreclosure, Mortgage Debt Charge-Off Accounts (effective 8/16/14)
Short Sale: Home sold but sales price did not cover amount owed.
Deed in Lieu: Home returned to lender in exchange for cancelling loan.
• 4 years from the date sale closed and transferred to new owner or transferred back to the bank as standard.
• Fannie Mae Only*: 2 years from the date sale closed and transferred to new owner or transferred back to the bank, possible with acceptable extenuating circumstances.
• Freddie Mac Only – When a loan receives an Accept risk classification, the loan does not need to be reviewed for waiting period requirements.
-Essent and NMI will follow this guidance however Arch MI will not and still requires verification that waiting periods are met.

Bankruptcy, Chapter 7
Debts are discharged through BK; therefore, client does not pay any debts owning.
• 4 years from discharge date.
• Fannie Mae Only*: 2 years from discharge date possible with acceptable extenuating circumstances (1).

Bankruptcy, Chapter 13
Debts are paid back on a monthly scheduled payment plan by client.
• 2 years from discharge date.
• 4 years from dismissal date.

Bankruptcy Including a Mortgage
Refer to Bankruptcy Guidelines with one exception:
• Refinances: Borrower may refinance a property included in a bankruptcy and not reaffirmed, provided the timely payment history (VOM) can be obtained to current. Conventional Mortgage Insurance Requirements
THE ABOVE GUIDELINES ARE BASED ON AGENCY GUIDANCE. IN THE EVENT A LOAN REQUIRES PRIVATE MORTGAGE INSURANCE, WAITING PERIODS EXTEND FROM 4 TO 7 YEARS DEPENDING ON THE COMPANY AND MAY INCLUDE ADDITIONAL REQUIREMENTS (REESTABLISHED CREDIT GUIDELINES, RESERVES, ETC.). CHECK WITH EACH MORTGAGE INSURANCE PROVIDER PRIOR TO ORIGINATION, IF THE LTV IS GREATER THAN 80%.
*Loans with shorter time frames require verification of extenuating circumstances and may not go to Freddie Mac. The extenuating circumstance must be supported by a letter of explanation and verification of the circumstance.

FHA (DETERMINED BY DATE OF CASE NUMBER ASSIGNMENT)

Refinance:
• Standard modifications (interest rate modifications) are acceptable with a 12-month waiting period.
Qualification is based on payment history and remaining underwriting considerations.
The modification must have taken place at a minimum 12 payments in advance of the refinance and reflect a satisfactory payment history.
-The modification agreement needs to be reviewed and underwritten with the file. The modification terms may supersede UHM guidelines.
-Deferred interest (per restructure agreement) may be included in the maximum loan amount calculation for rate and term refinances provided all standard conditions and qualification parameters are met.

Purchase:
• Acceptable with both agencies. Qualification is based on payment history and remaining underwriting considerations. Please note, files will be underwritten with a higher level of scrutiny.
The modification must have taken place at a minimum 12 payments in advance of the purchase and reflect a satisfactory payment history.

Foreclosure or Deed in Lieu of Foreclosure
Foreclosure: Home was given back to the bank – No owner participation.
Deed in Lieu: Home returned to lender in exchange for cancelling loan.
• 3 years + 1 Day from date foreclosure completed and the deed is transferred back to the bank, for the request of an FHA Case Number.
• With manual downgrade to Refer: Less than 2 years, but not less than 12 months, from date foreclosure completed and the deed is transferred back to the bank may be acceptable if the result of acceptable extenuating circumstances (2).

Short Sale
Short Sale: Home sold but sales price did not cover amount owed.
• 3 years from date sale closed and transferred to new owner.
• With manual downgrade to Refer: No waiting period if borrower had no late payments on any mortgages and consumer debts within the 12-month period preceding the short sale AND they are not taking advantage of declining market conditions.

Bankruptcy Chapter 7
Requirements Prior to Application
Refer/AUS Findings require PreApp Express Desk review prior to application if either of the following combinations apply:
• Bankruptcy 7: < 4 years since discharge and < 660 Credit Score or
• Bankruptcy 7: < 4 years since discharge and 100% Payment shock
Note: This does not apply to manually underwritten loans due to borrower(s) having no credit score.
General Requirements
Debts are discharged through BK; therefore, client does not pay any debts owing.
• 2 years from date of discharge with re-established credit paid as agreed or no new credit obligations occurred.
• With manual downgrade to Refer: Less than 2 years, but not less than 12 months, from date of discharge may be acceptable if the bankruptcy was caused by acceptable extenuating circumstances (2) and borrower has since exhibited a documented ability to manage financial affairs in a responsible manner.

Bankruptcy Chapter 13
Debts are paid back on a monthly scheduled payment plan by client.
• 2 years from date of discharge with re-established credit paid as agreed, OR
• With manual downgrade to Refer: a minimum of 1-year history in the payout period under the bankruptcy has elapsed and the borrower’s payment performance has been satisfactory, and all required
payments have been made on time. Verify the Borrower has received written permission from the bankruptcy court to enter into the mortgage transaction.
-Less than 2 years since discharge requires manual downgrade, but The Chapter 13 does NOT require a minimum period since discharge to approve under manual underwrite. Loan just needs to meet all other manual underwriting requirements.

Bankruptcy Including a Mortgage
Assuming No Reaffirmation:
• BK, stayed in home, purchase: Permitted 3 years from the date of deed transfer post-foreclosure.
• BK, stayed in home, refinance: Not permitted.
• BK, stayed in home for a portion of the time-frame, purchase: Permitted 3 years from the date of deed transfer post-foreclosure.

• BK, vacated home immediately after discharge: Permitted 3 years from the date of deed transfer post- foreclosure.

• BK, previous Government Loan: The later of 3 years from the date the CAIVRS claim is paid or 3 years from the deed transfer date.

Assuming Reaffirmation:
• If the home is foreclosed upon after reaffirmation, a 3-year waiting period from the date of deed transfer is required.

*All remaining traditional qualification and underwriting parameters apply in all instances.
Important Note: The dates listed will be based on the new FHA case number assignment, not the application or closing date.

VA (DETERMINED BY DATE OF CREDIT APPROVAL)

Previous Loan Modification
Refinance:
• Not permitted with previous modification (considered restructured mortgage) to adjust the principal balance. Standard modifications (interest rate modifications) are acceptable with no waiting period.
Qualification is based on payment history and remaining underwriting considerations.
-VA requires a reduction of interest rate, for the refinance to qualify.
-The modification must have taken place a minimum of 12 payments in advance of the refinance and reflect a satisfactory payment history.
-The modification agreement needs to be reviewed and underwritten with the file.

Purchase:
• Acceptable with both agencies. Qualification is based on payment history and remaining underwriting considerations. Please note, files will be underwritten with a higher level of scrutiny.
-The modification must have taken place a minimum of 12 payments in advance of the purchase and reflect a satisfactory payment history.

Foreclosure or Deed in Lieu of Foreclosure
Foreclosure: Home was given back to the bank – no owner participation.
Deed in Lieu: Home returned to lender in exchange for cancelling loan.
If the foreclosure or deed in lieu was on a VA-guaranteed loan, then a borrower may not have full entitlement for the new VA loan. Ensure that the borrower’s COE reflects sufficient entitlement to meet any secondary marketing requirements of the lender.
• 2 Years from date foreclosure completed and transferred back to bank.
• 12-23 Months from date of foreclosure, if credit is re-established and paid as agreed and was caused by acceptable extenuating circumstances (3).
• If the borrower’s payment history on the property was not affected before the deed in lieu and the borrower was voluntarily communicating with the servicer or holder, then a waiting period from the date transfer of the property may not be necessary.
-Gain complete understanding of the circumstances in which the borrower voluntarily surrendered the property.

Short Sale
Short Sale: Home sold but sales price did not cover amount owed.
• If the short sale was on a VA-guaranteed loan, then a borrower may not have full entitlement available for the new VA loan. Ensure that the borrower’s COE reflects sufficient entitlement to meet any secondary marketing requirements of the lender.
• No waiting period if borrower had no late payments on any mortgages and consumer debts within the 12-
month period preceding the short sale AND they are not taking advantage of declining market conditions.
• If the borrower’s payment history on the property was not affected before the short sale and the borrower
was voluntarily communicating with the servicer or holder, then a waiting period from the date transfer of the property may not be necessary.
-Gain complete understanding on the circumstances in which the borrower voluntarily surrendered the property.

• A waiting period of 12 months will apply when there are any derogatory credit events including, but not
limited to, late payments on the mortgage prior to the short sale.
o The borrower must have 12 months of reestablished credit since the date the short sale property
was transferred to the new owner.

General Requirements:
Debts are discharged through BK; therefore, client does not pay any debts owing.
• 2 years from date of discharge.
• 12-23 months from date of discharge, if credit is re-established and paid as agreed and was caused by acceptable extenuating circumstances (3).
• If a foreclosure, deed in lieu, or short sale process is in conjunction with a bankruptcy, use the latest date of either the discharge of the bankruptcy or transfer of title for the home to establish the beginning date of re-established credit.
-If there is a significant delay in the transfer of title, the lender should contact the RLC of jurisdiction for guidance.

Bankruptcy Chapter 13
Debts are paid back on a monthly, scheduled payment plan by client.
• 1-year payout period under bankruptcy has elapsed and the borrower’s payment performance has been satisfactory, and all required payments made on time. If the borrower(s) has satisfactorily made at least 12
months’ worth of the payments and the trustee or bankruptcy judge approves of the new credit, the loan can be considered favorably.
• If foreclosure, deed in lieu, or short sale process is in conjunction with a bankruptcy, use the latest date of either the discharge of the bankruptcy or transfer of title for the home to establish the beginning date of
re-established credit.
-If there is a significant delay in the transfer of title, the lender should contact the RLC of jurisdiction for guidance.

Bankruptcy Including a Mortgage
• 2 years from the date of discharge.
• If a foreclosure, deed in lieu, or short sale process is in conjunction with a bankruptcy, use the latest date of either the discharge of the bankruptcy or transfer of title for the home to establish the beginning date of re-established credit.
-If there is a significant delay in the transfer of title, the lender should contact the RLC ofjurisdiction for guidance.