Posted by Scriba/NM on 7/27/10 7:12pm
Msg #346504

Here's Something Interesting

There are some notaries that are interested in the "why" of things and I guess that sort of covers me. Try this on for size (maybe you're already aware of it) -

Lender Now Required to Repull Credit Before Closing – As of June 1, 2010, Fannie Mae has now made it a requirement for all lenders to Repull Credit before closing to ensure that the updated information matches the information initially taken on the loan application. The “Loan Quality Initiative” directs all lenders to re-underwrite the loan if material differences exist. For example, if a new credit report is pulled and, it is discovered that a new loan or debts exist; lenders will be required to re-underwrite the loan and take into account this new debt information. If the new debt somehow disqualifies the individual, the loan will be DENIED and the closing will not happen.

No wonder it takes so long for these loans to be processed with all this endless processing. For the full story, go to this link:

http://activerain.com/blogsview/1693771/lenders-now-required-to-repull-credit-before-closing-true-fannie-mae-s-grip-tightens

Reply by Stamper_WI on 7/27/10 7:41pm
Msg #346510

Some of them also reverify employment up to the last hour or so of the signing. Not long ago a woman told me this because she answered the phones for her company and said they called several times and asked her if she was employed there. A local TC also does it one more time before funding as well.

Reply by anotaryinva on 7/27/10 7:46pm
Msg #346511

some more reading on the subject:

http://www.mortgagenewsdaily.com/channels/pipelinepress/05252010-metlife-jobs-lqi.aspx

Personally, I don't have a problem with them updating the files if it doesn't delay us getting the docs.

Reply by MikeC/NY on 7/27/10 7:52pm
Msg #346514

"As of June 1, 2010, Fannie Mae has now made it a requirement for all lenders to Repull Credit before closing to ensure that the updated information matches the information initially taken on the loan application. The “Loan Quality Initiative” directs all lenders to re-underwrite the loan if material differences exist. For example, if a new credit report is pulled and, it is discovered that a new loan or debts exist; lenders will be required to re-underwrite the loan and take into account this new debt information. If the new debt somehow disqualifies the individual, the loan will be DENIED and the closing will not happen."


And this is a bad idea because????

Reply by Scriba/NM on 7/28/10 12:15am
Msg #346538

No one, I believe, ever said it was a bad idea. It has nothing to do with good or bad.

I stated it was interesting, since it is obvious to even the untrained eye, that this, along with other new rules, is what is causing the longer delay in getting loans approved, that's all.

Reply by LKT/CA on 7/27/10 8:29pm
Msg #346518

<<<Lender Now Required to Repull Credit Before Closing – As of June 1, 2010,...>>>

As far as I know, this has always been SOP (standard operating procedure).

Reply by MW/VA on 7/27/10 9:38pm
Msg #346528

That could be a problem. The CB's run 30-60 days behind on updating info.

Reply by ReneeK_MI on 7/28/10 4:54am
Msg #346548

Fannie Mae retracted ...creates some confusion

http://tinyurl.com/26vzos5

Story dated July 17th - I googled the topic because I couldn't find this new 'requirement' on Fannie Mae's site ...

"...But lenders complain that the policy creates logistical nightmares that could trip up home purchases at a critical time in the housing market's struggle to recover. They say new debt, even if it's fleeting, could inadvertently skew a borrower's credit profile enough so that pre-approved loans do not get funded.

This week, Fannie Mae said it is reviewing the policy based on feedback from lenders and will offer more guidance by the end of July. In an updated document on its website, the company said it intended only to reemphasize existing policies, not require additional credit reports.

Deborah Slade-Horsey, vice president of single-family risk policy at Fannie Mae, said the company was merely making a suggestion to help lenders establish prudent lending processes. "Never was the intent that it is something that you are required to do on 100 percent of the loans," she said. "We think that this is one of the tools they can use."

On Wednesday, Fannie Mae removed from its online guidance documents any reference to "refreshing" or pulling new credit reports..."

Reply by BobbiCT on 7/28/10 7:00am
Msg #346552

From and Old Timer ...

Not "new," used to be SOP before flipping mortgages became fast, furious and so very profitable for the first one to get rid of that unknown risk.

1-2 business days before closing, the local BANK giving the mortgage would pull a "final" credit report and call to re-verify employment of borrowers. This was done AFTER the loan documents (and postdated check check) were sent to the borrower's attorney.
Underwriter would "initial off" if everything same or close to it. If not, called borrower, got explanation made note .... or called borrower's attorney to stop closing because ...

Took 10-15 minutes tops. Borrowers didn't pay and, unless a question, never even knew this was being done. Kept at least one person employed full-time getting reports and making calls to get information, too. Of course, this was when BANKS wanted to be certain they had a safe and sound loan portfolio for the next 30 years because they weren't quickly selling it to a greedy entity with an unknowledgable, sloppy QC Department. If sold to the Fs, still good because silly us ... we didn't want to sc**w the goverment, after all it was OUR taxpayer dollars at stake.