NewRez is closely monitoring the evolving situation of COVID-19 and is providing an update on temporary guidance while we navigate through this uncertain time. This announcement provides flexibilities for conventional conforming loans for project review and property valuation flexibilities per Fannie Mae Lender Letter LL-2020-04 and Freddie Mac Bulletins 2020-8 and 2020-11.
These temporary flexibilities are effective immediately for all conventional conforming loans in process and remain in place for loans with applications dated on or before May 17, 2020.
We will continue to provide updates as the situation changes.
FANNIE MAE AND FREDDIE MAC PRODUCTS ONLY
Property Valuations - Appraisal Flexibilities
Virtual Inspections for Appraisals
Appraisers may use virtual inspection methods to augment the data and imagery that is used for either a desktop appraisal or an exterior-only inspection appraisal. A virtual inspection is not a substitute for an on-site interior and exterior inspection.
Additional Instructions for Appraisals
For an appraisal with a desktop appraisal or an exterior-only inspection that is completed on a form for an interior and exterior inspection (e.g., Form 1004/70), the appraisal report must include, in the “Map Reference” field, the corresponding text identifier that verifies the type of appraisal completed; specifically, “desktop” or “exterior,” as applicable.
No other words or phrases may be used or included.
Condominium Project Reviews
Additional guidance and temporary flexibilities for project eligibility reviews on condo projects are being offered due to COVID-19 concerns.
Waiver of Project Review
We are extending project review waiver flexibilities for loans with LTV ratios greater than 80% and up to 90%. This flexibility applies to Fannie Mae owned, or Freddie Mac owned, limited cash-out refinance transactions for owner-occupied condo units only. Second homes and investment transactions are excluded.
When applying this flexibility, confirm the project meets the following, existing requirements:
- the litigation requirements described in Selling Guide B4-2.1-03, Ineligible Projects
- all policies in Selling Guide B4-2.1-02, Waiver of Project Review
- the litigation requirements described in Section 5701.3(i) Ineligible Projects
- the exempt from review requirements inSection 5701.7, Exempt From Review
Project Documents Used in Project Reviews
When a budget review is required on an established project, the budget from the 2019 fiscal year may be provided if the current year’s budget has not yet been ratified due to issues related to COVID-19.
Confirm the project currently meets the HOA dues delinquency requirements.
Other sources of condo project data may be used to complete project reviews including, but not limited to:
- MLS records
- Plat map/site surveys
- Public records
- State laws or local ordinances
- Tax searches
Reminder: If a project review for an established condo project was previously completed, that project review may be used for additional condo unit loans in the same condo project for up to one year (measured to the note date of the subsequent loans).
For new condo projects, the time frame is 180 days prior to the note date.
For additional information, below are links to Fannie Mae and Freddie Mac Frequently Asked Questions
Remember that NewRez is not adopting all flexibilities in the Fannie Mae and Freddie Mac announcements, therefore some guidelines in their announcements and FAQ may not apply.
Please reference the NewRez Lending Library or NewRezCorrespondent.com for the changes outlined in this announcement.