No Cash-out Refinance Mortgage

Document Sample
No Cash-out Refinance Mortgage Powered By Docstoc
					Key Features:                  No Cash-out Refinance Mortgage
•   Up to 95% LTV              Retain Your Borrowers With More Refinance Options
•   No seasoning               Many borrowers continually look for the opportunity to lower their monthly payment
    requirement                and consolidate higher-rate seconds into one, lower-rate loan. Freddie Mac’s No
                               Cash-out Refinance Mortgage lets you offer existing customers and new borrowers
•   New mortgage may
                               more refinance options to meet their individual needs.
    include amounts used
    to pay off junior liens    A No Cash-out Refinance Mortgage can lower a borrower’s monthly P&I payment,
    secured by the             and all related closing costs, financing costs and prepaids/escrows can be rolled into
    mortgaged premises         the new loan amount. Borrowers can receive cash back in an amount up to $2,000 or
    that were used in their    two percent of the refinance mortgage, whichever is less. Borrowers can also use a No
    entirety to acquire the    Cash-out Refinance Mortgage to pay off junior liens secured by the mortgaged
    subject property           premises used in their entirety to acquire the subject property. You’ll need to maintain
•   1- to 4-unit primary       documentation in the mortgage file demonstrating that the full amount of the lien was
    residences, second         used for the purchase of the subject property.
    homes and 1- to 4-unit
    investment properties      There’s no seasoning requirement for the mortgage being refinanced. Plus, when you
                               use Loan Prospector® automated underwriting technology to assess No Cash-out
•   Roll all related closing   Refinance Mortgages, you’ll streamline your process with less documentation.
    costs, financing costs
    and prepaid items into     Lender Benefits
    the new loan amount
                               No Cash-out Refinance Mortgages help you:
•   Disburse cash to the
                               •   Retain your current customer base and increase your origination volume with
    borrower up to $2,000
                                   options to meet the needs of more borrowers.
    or 2% of the refinance
    mortgage amount,           •   Improve efficiencies using Loan Prospector technology.
    whichever is less
                               •   Leverage the combination of No Cash-out Refinance Mortgages with many
Looking for Other                  Freddie Mac mortgage products to offer a variety of options for the new mortgage.
Refinance Mortgage             Borrower Benefits
Options?
                               For your borrowers, No Cash-out Refinance Mortgages:
Visit FreddieMac.com for
more information on:           •   Lower their rate and payment.
•   Streamlined Refinance      •   Consolidate higher-rate seconds into one, lower-rate loan.
    Mortgages and Freddie
                               •   Eliminate upfront costs by rolling all related closing costs, financing costs and
    Mac-owned Streamlined
                                   prepaid items into the new loan amount.
    Refinance Mortgage
                               •   Eliminate mortgage insurance when the new appraisal or inspection report
•   Cash-out Refinance
                                   supports a higher value to calculate the new LTV ratio.
    Mortgages
                                                See reverse for underwriting, execution and other details.
                                                                    Borrower Eligibility Requirements
Eligible Property Types
                                                                    • Loan Prospector Accept
  • 1- to 4-unit primary residence, including condos,
    PUDs and manufactured homes                                     •   For manually underwritten No Cash-out
                                                                        Refinance Mortgages, the Seller must make the
  • 1- to 4-unit investment property                                    determination regarding borrower
  • Second home                                                         creditworthiness in accordance with the
                                                                        requirements of the Guide Chapter 37.
Eligible Mortgages
                                                                    Closing Costs, Financing Costs &
  • 15-, 20-, 30- and 40-year* fixed-rate mortgages                 Prepaids/Escrows
  • 5- and 7-year balloon/reset mortgages                           All closing costs, financing costs and prepaids can
  • Most standard ARMs                                              be rolled into the new loan amount.

  • No seasoning requirement                                        Cash Back to Borrower
*40-year fixed-rate mortgages are eligible for assessment in Loan   $2,000 or 2% of the refinance mortgage amount,
Prospector, and commitment and delivery through the selling         whichever is less.
system, beginning September 1, 2006.
                                                                    Special Underwriting Requirements
Maximum LTV for New Mortgage
                                                                    • New loan application required.
• For mortgages other than 40-year fixed-rate
  mortgages                                                         •   A borrower may be added or removed from the
                                                                        mortgage.
  1- to 2-unit primary residence or second home:
                                                                    •   Mortgage payment history and minimum
  ⇒    Max. LTV without secondary financing: 95%                        income documentation in accordance with Loan
  ⇒    Max. LTV with secondary financing: 90%                           Prospector credit risk/documentation class or
  ⇒    Max. TLTV with secondary financing: 95%                          Guide requirements.
  ⇒    Max. HTLTV: 100%
                                                                    •   No asset documentation required. Seller must
  1- to 2-unit investment property:                                     verify reserves if they are entered in Loan
                                                                        Prospector.
  ⇒    Max. LTV without secondary financing: 90%
  ⇒    Max. LTV with secondary financing: 85%
                                                                    Subordinate Liens
  ⇒    Max. TLTV with secondary financing: 90%
                                                                    •  Can be paid off from the proceeds of the new
  ⇒    Max. HTLTV: 95%
                                                                       loan if used in its entirety to acquire the subject
  3- to 4-unit primary residence:                                      property, or must be subordinated or paid off
                                                                       from borrower funds.
  ⇒    Max. LTV without secondary financing: 80%
  ⇒    Max. LTV with secondary financing: 75%                       •   When a junior lien is paid off as part of the No
  ⇒    Max. TLTV with secondary financing: 80%                          Cash-out transaction, you must maintain
  ⇒    Max. HTLTV: 85%                                                  documentation in the mortgage file
                                                                        demonstrating that the full amount of the lien
  3- to 4-unit investment property:                                     was used for the purchase of the subject
  ⇒    Max. LTV without secondary financing: 75%                        property.
  ⇒    Max. LTV with secondary financing: 70%
  ⇒    Max. TLTV with secondary financing: 75%                      Collateral Assessment
  ⇒    Max. HTLTV: 80%                                              An appraisal or inspection that meets the
                                                                    requirements of Guide Chapter 44 is required in
  • For 40-year fixed-rate mortgages, maximum                       compliance with Loan Prospector’s minimum
  LTV ratios must comply with Single-Family                         assessment feedback; the transaction may also be
  Seller/Servicer Guide (Guide), Section 23.4 for                   eligible for the Property Inspection Alternative
  Loan Prospector® and manually underwritten                        (PIA). For non-Loan Prospector loans, an appraisal
  mortgages.                                                        with an interior and exterior inspection is required.
Eligible Executions                                  Delivery Fees
• Servicing-retained Cash                            Postsettlement delivery fees may apply, depending
                                                     on the property type and LTV ratio. See Guide
•   WAC ARM Cash
                                                     Exhibit 19 for details, or access Guide Exhibit 19
•   Fixed-rate Guarantor                             online at
•   WAC ARM Guarantor                                www.freddiemac.com/singlefamily/pdf/ex19.pdf.

•   MultiLender Swap                                 Learn More About Freddie Mac No Cash-out
•   40-year fixed-rate mortgages may be sold under   Refinance Mortgages:
    Fixed-rate Guarantor and cash executions         • Call (800) FREDDIE
    through the selling system only, beginning       •    Visit FreddieMac.com
    September 1, 2006.
                                                     •    Refer to Single-Family Seller/Servicer Guide
Delivery Requirements                                     Chapter 24
• SCC: 007
                                                     The information in this document is not a replacement or substitute for
                                                     information found in the Single-Family Seller/Servicer Guide and/or the
                                                     terms of your Master Agreement and/or Master Commitment.




                                                                                                        Publication Number 388
                                                                                                        July 2006

				
DOCUMENT INFO
Shared By:
Tags:
Stats:
views:14
posted:10/30/2011
language:English
pages:3