Carrington Wholesale

brokerIQ

FEMA Disaster Declaration for Tennessee Severe Storms, Straight-line Winds, and Tornadoes

January 18, 2022rashtonBulletin

Overview

Due to severe storms, straight-line winds, and tornadoes in Tennessee, FEMA has declared the following counties a disaster.

Incident Period: December 10, 2021 – December 11, 2021

State FEMA Disaster Declaration Counties
Tennessee January 14, 2022 Cheatham, Davidson, Dickson, Gibson, Henderson, Henry, Lake, Obion, Stewart,
Sumner, Weakley and Wilson

Re-Inspection by Product Type

If your loan is … A re-inspection is required … Under these circumstances …
FHA Full Doc Yes If the original appraisal inspection date was prior to the Incident Period End Date – 12/11/21.
FHA Streamline No Not applicable
VA Full Doc and IRRRL Yes If the loan was not closed (signed) prior to the Declaration Date of 01/14/22.
USDA Full Doc and Streamline Assist Yes If the original appraisal inspection date was prior to the Incident Period End Date – 12/11/21.
Conventional* and Non-Agency Yes If the original appraisal inspection date was prior to the Incident Period End Date – 12/11/21.

*If an appraisal was not required due to a property inspection waiver (PIW), an inspection report will still be required.

Contacts

Please contact your Account Executive or Account Manager with any questions.

Carrington thanks you for your business.

Loan Level Pricing Adjustments for Conventional High Balance Loans and Second Homes

January 14, 2022jordanreedBulletin

Overview

The Federal Housing Finance Agency (FHFA) recently announced targeted increases to Fannie Mae and Freddie Mac’s Loan Level Pricing Adjustments (LLPA/upfront fees) for certain high balance/super-conforming loans and second home loans. The updated LLPAs are effective for all whole loans purchased on or after April 1, 2022 and for loans delivered into MBS pools with issue dates on or after April 1, 2022. These pricing adjustments for high balance/super-conforming loans will increase between 0.25 percent and 0.75 percent, tiered by loan-to-value ratio. For second home loans, upfront fees will increase between 1.125 percent and 3.375 percent, tiered by loan-to-value ratio.

Carrington Mortgage Services, LLC (CMS) will transition to the new LLPA’s effective January 18, 2022 for conventional high balance/super-conforming and second home loans. Any existing loans in the pipeline locked with the “old” LLPA’s must close and fund by March 1, 2022.  Please view our CMS Rate Sheets for full details.

Contacts

Please contact your Account Executive or Account Manager with any questions.

Carrington thanks you for your business.

Martin Luther King Jr Holiday – Lock Desk Hours and Key Compliance Dates

January 6, 2022rashtonBulletin

Overview

The offices of Carrington Mortgage Services, LLC (CMS) including the Lock Desk will be closed Monday, January 17, 2022, for Martin Luther King Jr. Day, which is a Federal Holiday. Normal lock hours will resume on Tuesday, January 18, 2022.

Rate Locks that expire on the holiday will automatically roll to the next business day.  In addition, there are some important disclosure considerations associated with the holiday:

  • Monday January 17, 2022 cannot be included in the rescission period for refinance transactions.
  • Monday January 17, 2022 cannot be included in the seven (7) business day waiting period between the between the date the initial Loan Estimate (LE) was provided to the borrower and the consummation of the loan.
  • When re-disclosure of the LE is required, Monday January 17, 2022 cannot be included in the three (3) day business waiting period between the date the revised LE was provided to the borrower and the consummation of the loan.
  • When re-disclosure of the CD is required, Monday January 17, 2022 cannot be included in the three (3) business day waiting period between the date the revised CD was provided to the borrower and the consummation of the loan.

Issues related to locks should be sent via email to lockdesk@carringtonms.com.

Contacts

Please contact your Account Executive or Account Manager with any questions.

Carrington thanks you for your business.

FEMA Disaster Declaration for Washington Flooding and Mudslides

January 6, 2022rashtonBulletin

Overview

Due to flooding and mudslides in Washington, FEMA has declared the following counties a disaster.

Incident Period: November 13, 2021 – November 15, 2021

State FEMA Disaster Declaration Counties
Washington January 5, 2022 Clallam, Skagit and Whatcom

Re-Inspection by Product Type

If your loan is … A re-inspection is required … Under these circumstances …
FHA Full Doc Yes If the original appraisal inspection date was prior to the Incident Period End Date – 11/15/21.
FHA Streamline No Not applicable
VA Full Doc and IRRRL Yes If the loan was not closed (signed) prior to the Declaration Date of 01/05/22.
USDA Full Doc and Streamline Assist Yes If the original appraisal inspection date was prior to the Incident Period End Date – 11/15/21.
Conventional* and Non-Agency Yes If the original appraisal inspection date was prior to the Incident Period End Date – 11/15/21.

*If an appraisal was not required due to a property inspection waiver (PIW), an inspection report will still be required.

Contacts

Please contact your Account Executive or Account Manager with any questions.

Carrington thanks you for your business.

FEMA Disaster Declaration for Colorado Wildfires and Straight-line Winds

January 6, 2022rashtonBulletin

Overview

Due to wildfires and straight-line winds in Colorado, FEMA has declared the following county a disaster.

Incident Period: December 30, 2021 and Continuing

State FEMA Disaster Declaration Counties
Colorado December 31, 2021 Boulder

Re-Inspection by Product Type

If your loan is … A re-inspection is required … Under these circumstances …
FHA Full Doc Yes If the original appraisal inspection date was prior to the Incident Period End Date – Continuing**.
FHA Streamline No Not applicable
VA Full Doc and IRRRL Yes If the loan was not closed (signed) prior to the Declaration Date of 12/31/2021.
USDA Full Doc and Streamline Assist Yes If the original appraisal inspection date was prior to the Incident Period End Date – Continuing**.
Conventional* and Non-Agency Yes If the original appraisal inspection date was prior to the Incident Period End Date – Continuing**.

*If an appraisal was not required due to a property inspection waiver (PIW), an inspection report will still be required.

**In cases where FEMA has not yet issued an Incident End Date and the disaster is “Continuing”, the earliest CMS will permit a re-inspection is a minimum of 14 calendar days from the Incident Period Start Date.

Contacts

Please contact your Account Executive or Account Manager with any questions.

Carrington thanks you for your business.

Escrow Repair Loan Program Discontinued

December 31, 2021rashtonBulletin

Overview

Effective December 31, 2021, Carrington Mortgage Services, LLC (CMS) will discontinue offering FHA 203(b) Escrow Repair loans through the Wholesale Channel.  Brokers must submit all 203(b) loans prior to the December 31, 2021 effective date or the loans will be denied.

FEMA Disaster Declaration for Alabama Severe Storms and Flooding

December 22, 2021rashtonBulletin

Overview

Due to severe storms and flooding in Alabama, FEMA has declared the following counties a disaster.

Incident Period: October 6, 2021 October 7, 2021

State FEMA Disaster Declaration Counties
Alabama December 21, 2021 Jefferson and Shelby

Re-Inspection by Product Type

If your loan is … A re-inspection is required … Under these circumstances …
FHA Full Doc Yes If the original appraisal inspection date was prior to the Incident Period End Date – 10/07/21.
FHA Streamline No Not applicable
VA Full Doc and IRRRL Yes If the loan was not closed (signed) prior to the Declaration Date of 12/21/2021.
USDA Full Doc and Streamline Assist Yes If the original appraisal inspection date was prior to the Incident Period End Date – 10/07/21.
Conventional* and Non-Agency Yes If the original appraisal inspection date was prior to the Incident Period End Date – 10/07/21.

*If an appraisal was not required due to a property inspection waiver (PIW), an inspection report will still be required.

Contacts

Please contact your Account Executive or Account Manager with any questions.

Carrington thanks you for your business.

Holiday Lock Desk Hours & Key Compliance Dates

December 21, 2021rashtonBulletin

Overview

During the 2021 holiday season the Carrington Mortgage Services, LLC (CMS) Lock Desk, will observe the following schedule:

  • Thursday, December 23, 2021 – Close early at 11:00 AM PST (early market closure of 2:00 PM EST)
  • Friday, December 24, 2021 – CMS Offices closed for the Christmas holiday
  • Monday, January 3, 2022 – CMS Offices closed for New Year’s Day holiday

Normal Lock Desk hours will resume December 27, 2021 and January 4, 2022.

Rate Locks that expire on the holidays will automatically roll to the next business day.  In addition there are some important disclosure considerations associated with the holidays:

  • Friday, December 24, 2021 and Monday January 3, 2022 cannot be included in the rescission period for refinances.
  • Friday, December 24, 2021 and Monday January 3, 2022 cannot be included in the seven (7) business day waiting period between the between the date the initial Loan Estimate (LE) was provided to the borrower and the consummation of the loan.
  • When re-disclosure of the LE is required, Friday, December 24, 2021 and Monday January 3, 2022 cannot be included in the three (3) day business waiting period between the date the revised LE was provided to the borrower and the consummation of the loan.
  • When re-disclosure of the CD is required, Friday, December 24, 2021 and Monday January 3, 2022 cannot be included in the three (3) business day waiting period between the date the revised CD was provided to the borrower and the consummation of the loan.

Issues related to locks should be sent via email to lockdesk@carringtonms.com.

New ProcessIQ Loan Processing Service

December 20, 2021rashtonBulletin

Overview

Carrington Mortgage Services, LLC (CMS) is pleased to announce the new ProcessIQ service available for Wholesale Brokers.  This new service provides approved CMS Brokers with the option to have their loans processed by Carrington.  This service is unique in the industry and gives Carrington a competitive advantage over all other lenders!  ProcessIQ allows brokers the choice to expand the overall underwriting services for which Carrington has deep expertise.  Brokers must sign up to be part of the program with their Account Executive, but there are no special requirements to sign up.

Program Details

With ProcessIQ, when an enrolled Broker submits a Non-QM or full-doc FHA, VA or USDA loan they may request the Carrington ProcessIQ team to work directly with the borrower to process the loan.  The Broker’s Loan Officer continues to manage all licensable activities in the same manner as they do today; however, CMS will handle everything else with the loan transaction.

Some of the Key Benefits Brokers enjoy when using ProcessIQ include:

  • A first-rate experience for the borrower
  • The capacity to originate complex loans
  • Additional processing capacity to originate more loans
  • Proactive communication to stay informed every step of the way
  • No expensive 3rd Party Processing Fees which average over $800 per loan file
  • Just $200 added to our already low CMS Underwriting Fee

Fees

ProcessIQ has the following fee structure:

Loan Type/State Underwriting Fee* Underwriting Fee with ProcessIQ*
Conforming/Government $699 $899
Non-QM $750 $950
North Carolina $150 $150
New Jersey & Iowa $0 $0

*Conventional and Government Stream/IRRRL loans are not eligible for the new ProcessIQ service.

Contact

Contact your account executive sign up or click here to get more information.

Updated Non-QM Product Underwriting Guidelines – DSCR FICO from 620

December 13, 2021rashtonBulletin

Overview

Carrington Mortgage Services, LLC (CMS) is pleased to announce the following Carrington Advantage product underwriting updates (highlighted in red).

Please note this is an abbreviated summary of the guideline changes. All updates should be viewed within the context of the full guidelines available on Carrington BrokerIQ.

Investor Advantage Program
Old Requirements Updated Requirements
Added new FICO and LTV bands for Purchase, Rate Term and Cash-Out transactions for loan amounts of $1M and under.

Loan Amount FICO Purchase & R/T Cash Out
≤ $1,000,000 720 82.50% 75%
700 80% 75%
680 80% 75%
660 75% 70%
640 75% 65%
620 75% NA

 

Lease Requirements

For refinance transactions, an executed lease with no less than 3 months remaining at time of close is required for all units in the subject property. Month-to-month tenancy is not subject to this requirement with sufficient evidence (such as a signed extension letter). Purchase transactions may be vacant.

The following requirements apply to refinance transactions:

  • Lease term not to exceed 1 year
  • Monthly lease payments must be consistent with market rents

If subject property is not leased see the Carrington Investor Advantage Program Matrix for LTV restrictions.

Lease Requirements

For refinance transactions, an executed lease with no less than 3 months remaining at time of close is required for all units in the subject property contributing to the DSCR calculation. Month-to-month tenancy is not subject to this requirement with sufficient evidence (such as a signed extension letter). Purchase transactions may be vacant.

Existing leases and title reports must be reviewed to ensure clear title and first lien enforceability. Tenants must not have a first right of refusal to purchase the subject property. Lease terms must not exceed three (3) years.

If subject property is not leased, proposed rents may be used for vacant units based on the appraiser’s rent analysis. See the Carrington Investor Advantage Program Matrix for LTV restrictions for unleased properties on refinance transactions.

 

Investor Advantage Program (continued)
Old Requirements Updated Requirements
Business Assets

For self-employed borrowers, business assets are an acceptable source of funds for down payment, closing costs, and reserves. The borrowers on the loan must have 100% ownership of the business and must be the owners of the account.

A letter from a CPA or borrower must be obtained verifying that the withdrawal of funds for the transaction will not have a negative impact on the business. If a CPA letter is not provided, a cash flow analysis of the tax returns, business bank statements, and P&L (when applicable) must be completed by the Underwriter to determine if the withdrawal of funds from the business is acceptable.

Business Assets

For self-employed borrowers, business assets are an acceptable source of funds for down payment, closing costs, and reserves. The borrowers on the loan must have 50% ownership of the business and must be the owners of the account or demonstrate ability to access the account. Business assets must be multiplied by the borrower’s ownership percentage of the business. For bank accounts solely in the name of a business, access must be demonstrated using a cancelled check signed by the borrower, signature card or other documentation from the bank, CPA letter, or corporate documents such as a corporate resolution, operating agreement or similar.

Note: The requested information shall not be interpreted as an assurance of solvency.

Fraud Report and Background Check

All loans must include a third-party fraud detection report for all borrowers, borrowing entities and/or guarantors. Report findings must cover standard areas of quality control including, but not limited to; borrower validation, social security number verification, exclusionary lists, and property information (subject property). All Non-Agency loans with fraud alerts must be reviewed by QC and CCM for approval. High-level alerts relating to the subject property, borrower identity, and undisclosed mortgages must be addressed by the Underwriter.

 

All Programs
Old Requirements Updated Requirements
Rate/Term Refinance

If the most recent first mortgage transaction on the property was a cash-out refinance within the last 6 months, the new mortgage is not eligible as a rate/term and must proceed as a cash-out refinance. Note date to note date is used to calculate the 6 months.

Rate/Term Refinance

If the most recent first mortgage transaction on the property was a cash-out refinance within the last 6 months, the new mortgage is not eligible. Note date to note date is used to calculate the 6 months.

 

Flexible Advantage/Advantage Plus Programs
Old Requirements Updated Requirements
First Time Home Buyers

A First-Time Home Buyer is defined as a purchase transaction where any borrower has had no ownership interest in a residential property in the United States during the preceding 3-year period.

The following requirements apply to First-Time Home Buyer transactions:

Ÿ  Primary residence and second homes only

Ÿ  Minimum 580 score

Ÿ  6 months reserves after closing

First Time Home Buyers

A First-Time Home Buyer is defined as a purchase transaction where any borrower has had no ownership interest in a residential property in the United States during the preceding 3-year period.

The following requirements apply to First-Time Home Buyer transactions:

Ÿ  Primary residence and second homes only

Ÿ  Minimum 620 score

Ÿ  6 months reserves after closing

 

Flexible Advantage/Advantage Plus and Prime Advantage Programs
Old Requirements Updated Requirements
Business Assets

For self-employed borrowers, business assets are an acceptable source of funds for down payment, closing costs, and reserves. The borrowers on the loan must have 100% ownership of the business and must be the owners of the account.

A letter from a CPA or borrower must be obtained verifying that the withdrawal of funds for the transaction will not have a negative impact on the business. If a CPA letter is not provided, a cash flow analysis of the tax returns, business bank statements, and P&L (when applicable) must be completed by the Underwriter to determine if the withdrawal of funds from the business is acceptable.

Business Assets

For self-employed borrowers, business assets are an acceptable source of funds for down payment, closing costs, and reserves. The borrowers on the loan must have 50% ownership of the business and must be the owners of the account or demonstrate ability to access the account. Business assets must be multiplied by the borrower’s ownership percentage of the business. For bank accounts solely in the name of a business, access must be demonstrated using a canceled check signed by the borrower, signature card or other documentation from the bank, CPA letter, or corporate documents such as a corporate resolution, operating agreement or similar.

A letter from a CPA or borrower must be obtained verifying that the withdrawal of funds for the transaction will not have a negative impact on the business. If a CPA letter is not provided, a cash flow analysis of the tax returns, business bank statements, and P&L (when applicable) must be completed by the Underwriter to determine if the withdrawal of funds from the business is acceptable

Note: The requested information shall not be interpreted as an assurance of solvency.

Contacts

Please contact your Account Executive or Account Manager with any questions.

Carrington thanks you for your business.