Below are some highlights of the recent guideline changes and updates.

HOI deductible should not exceed 5%. Properties should have replacement cost coverage in an amount that is at least equal to the guaranteed value of the improvements or the unpaid principal balance. Deductible(s) should not exceed 5% of the total coverage amount.

Flood deductible should not exceed 10,000.00 Flood insurance must cover the lesser of the outstanding principal balance of the loan or the maximum amount of coverage allowed under NFIP. Unless a higher amount is allowed by state or federal law (which includes FEMA policies), the maximum deductible clause for a flood insurance policy should not exceed $10,000. Existing dwellings are eligible for the SFHGLP if flood insurance is available.

Can a borrower print out a transaction statement, register, or list of their account activity and have it stamped by the banking institution in place of the official electronic bank statements in regard to assets and reserves?  Asset documentation – FOR RESERVES the actual bank statement is required. The ending balance of the most recent statement can be used for reserves. A transaction history, screen shots or partial transaction histories are no longer acceptable to document reserves. FOR FUNDS TO CLOSE the actual bank statement should be provided. However an official transaction history that reflects the URL can be used.

My borrower has multiple payment app (Venmo, PayPal, etc.) deposits on their bank statements. Do I need to investigate all of them? Non-payroll deposits – Any non-payroll deposit that exceeds 1000.00 must be explained. In some cases additional documentation may be needed

Debts paid by business. Business debts reported on the applicant’s personal credit report may be excluded from the debt ratio if the debt is paid through a business account and documentation is obtained to show the business paid the debts for the previous 12 months. In addition, the borrower must have included the debts in the business profit and loss or cash flow analysis, to demonstrate that the liability is a business liability and not a personal liability.

Delinquent child support that is subject to an administrative offset. Administrative offset allows for the interception of certain federal payments in order to collect past due child support. Each state has an office(s) of child support enforcement. When a state refers delinquent child support to the Department of Treasury, they simultaneously report the delinquent child support to the credit bureaus. Lenders typically discover delinquent child support from the credit report, and they should then conduct due diligence to learn whether an administrative offset referral was made by the state to the Department of Treasury. Verification from the child support enforcement agency may be necessary to verify if the delinquent child support is subject to administrative offset