Here is a simplified guide to handle employment, income and asset documentation and verification during the COVID-19 crisis. These procedures are effective indefinitely until we issue further direction.
Employment Verification Requirements
The below guidance applies to ALL Loan Products and Documentation Types (except CMS-to-CMS FHA Streamline and VA IRRRL non-credit qualifying refinances):
|Verbal Verification||CMS Employee obtains verbal employment verification on an approved VVOE form confirming borrower still working||Conversation Dated Within 5 Business Days of Note Date|
|Written Verification||Obtain fully completed VOE form from an HR title or Management Title (Manager, Director, VP, etc.).
Email verifications are only valid for Conventional loans: must be received from a work email (e.g.JaneDoe@BusinessName.com) that identifies the name and title of the verifier (same requirements apply per VOE form) and the borrower’s name and current employment date.
|Form Dated Within 5 Business Days of Note Date (or Email Date for Conv. loans)|
|The Work Number||We will continue to accept automated verifications such as those from The Work Number, although the last date of employment verified must meeting aging requirements.
Note: In situations where the automatic database upload has not been refreshed within the required aging, we will have to wait for the next refresh period.
|Email or Signature Date Within 5 Business Days of Note Date|
|Paystub||Provide most recent year-to-date paystub. If using this method, if note date not within aging requirement, next closing date may be delayed based on payroll cycles.||Dated Within 5 Business Days of Note Date|
|Bank statement||Provide a bank statement evidencing the automatic payroll deposit reflecting the employer’s name.||Deposit Dated Within 5 Business Days of Note Date|
|Self-Employment||See below for list of self-employment verification options.||Dated Within 5 Business Days of Note Date|
IMPORTANT NOTE: Borrowers on Furlough: If a company verifies the borrower is still employee but is on furlough, we won’t be able to close the loan. If they are not receiving income, we can’t meet continuity of income requirements.
Verification of Self-Employment
Below are examples of methods the Lender may use to confirm the borrower’s business is currently operating:
NOTE: The prior guidance indicating that using a business website demonstrating activity supporting current business operations (timely appointments for estimates or service can be scheduled) is no longer a valid and acceptable verification method and should not be used.
How to Calculate 5 Business Day Requirement
The 5 business day requirement includes the date of the verification and the Note Date. For example, if a verification is dated on Monday, then the Note Date must be Friday or earlier provided there are not holidays in that week. Saturday, Sundays and company holidays are excluded from being counted as business days.
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Government Agency Approval | FHA Non-Supervised Mortgage Approval #: 24751-0000-5 | VA Automatic Lender Approval #: 902324-00-00