201 - DU Refi Plus
Product Summary
DU Refi Plus Summary
201 - Table of Contents
201 - DU REFI PLUS ... 201-1
DU Refi Plus Summary
DU Refi Plus Summary
201 - DU Refi Plus
Product Description and Product Codes
Product
Description Presentation
To minimize repetition, general guidelines and requirements affecting all DU Refi Plus are presented first, and then product-specific requirements are presented as a sub-section of this Product Guideline. Each sub-section has a loan parameter matrix for easy reference. For credit parameters not referenced, refer to Ocwen Residential’s Lending Guide.
FRM Product Codes
The following Product Code Matrix outlines the applicable product codes for the DU Refi Plus Fixed Rate Mortgage products.
Product Name FRM Product Code Product Feature Options
FRM DU Refi Plus Standard Loan Amounts
F1023BEF: 8 – 10 Year Increments F1523BEF: 11 – 15 Year Increments F2023BEF: 16 – 20 Year Increments F3023BEF: 21 – 30 Year Increments
Interest Only Option Term: Not Available
FRM DU Refi Plus High
Balance F1524BEF: 8 - 15 Year Increments F3024BEF: 16 – 30 Year Increments
Product feature options are available only to the terms/conditions outlined in the applicable sections of this product summary.
DU Refi Plus Summary
Product Description and Product Codes,
Continued
ARM Product Codes
The following Product Code Matrix outlines the applicable product codes for the DU Refi Plus Adjustable Rate Mortgage products.
Product Name ARM Product Code Product Feature Options
ARM DU Refi Plus Standard Loan Amounts
A5123BEF: 5/1 LIBOR A7123BEF: 7/1 LIBOR A10123BEF: 10/1 LIBOR
Interest Only Option Term: Not Available
ARM DU Refi Plus High
Balance A5124BEF: 5/1 LIBOR HIGH BALANCE A7124BEF: 7/1 LIBOR HIGH BALANCE A10124BEF: 10/1 LIBOR HIGH BALANCE
Product feature options are available only to the terms/conditions outlined in the applicable sections of this product summary.
DU Refi Plus Summary
Loan Details
Summary DU Refi Plus is a limited cash-out refinance program that allows for
expanded eligibility criteria, as well as reduced documentation requirements.
IMPORTANT: Application date must be dated on or before December
31, 2016 and must be funded by Ocwen no later than June 30, 2017.
Overview Unless otherwise noted in a specific sub-section, the loan details noted
below apply to all DU Refi Plus loans.
Review the entire product summary for full details regarding loan
parameters.
Same Servicer In regards to same-servicer references, Homeward Residential is a wholly
owned subsidiary of Ocwen Financial and its affiliate, Ocwen Loan Servicing, LLC is the servicing platform Homeward Residential utilizes when purchasing loans.
FNMA LookUp Fannie Mae has an online tool for borrowers to determine if Fannie Mae is
the investor on their loan and therefore possibly eligible for the DU Refi Plus program:
http://www.fanniemae.com/loanlookup/
DU Refi Plus Summary
Loan Details,
Continued
FRM Features The DU Refi Plus FRM Features detailed below provide definitions and
other important loan details:
Features Comments
Interest Only Feature Not Permitted
Conversion Option None
Prepayment Penalty Not Permitted
Assumable Not Assumable
Negative Amortization None
DU Refi Plus Summary
Loan Details,
Continued
ARM Features The DU Refi Plus ARM Features detailed below provide definitions and
other important loan details:
Features Comments
Interest Only Feature Not Available.
Index LIBOR defined as London interbank offered rate for twelve month United States dollar-denominated deposits, as published in the Wall Street Journal.
NOTE: The rate is equal to the note margin plus the index rounded to the nearest .125%.
Conversion Option None
Prepayment Penalty Not Permitted
Assumable 5/1, 7/1 & 10/1: Permitted after the initial fixed period, subject to qualifications.
Negative Amortization None
Caps 5/1: 2/2/5
7/1 & 10/1: 5/2/5
Rate Adjustments 5/1: The initial note rate is in effect for the initial 60 months. The initial rate adjustment is limited to 2% and subsequent rate
adjustment to 2% with a lifetime cap of 5%.
7/1: The initial note rate is in effect for the initial 84 months. The initial rate adjustment is limited to 5% and subsequent rate
adjustment to 2% with a lifetime cap of 5%.
10/1: The initial note rate is in effect for the initial 120 months. The initial rate adjustment is limited to 5% and subsequent rate
adjustment to 2% with a lifetime cap of 5%.
DU Refi Plus Summary
ARM Features, (Cont’d)
Features Comments
Floor The floor rate is never lower than the margin.
Margin 2.250%
Qualifying Rate 5/1: Greater of Note Rate + 2.00% OR the Fully Indexed
Rate
7/1, 10/1: Greater of Note Rate OR the Fully Indexed Rate
ARM Plans 5/1: 2725
7/1: 2727 10/1: 2729
Temporary
Buy down Not Permitted.
DU Refi Plus Summary
Loan Details,
Continued
Escrow Accounts / Impound Waivers
An escrow account will always be required by Homeward when Flood Insurance is required.
All insurances and taxes must be escrowed if Flood Insurance is required.
An escrow account will always be required if the loan requires private mortgage insurance (PMI).
Including single premiums and LPMI.
Full Escrow Waiver (if no Flood Insurance): Loans with LTVs of 80% or less (between 80.01% - 90.00% in California), the borrower may elect to waive escrows for Taxes and Insurance but must always escrow for
mortgage insurance, if required.
Partial Escrow Waiver (if no Flood Insurance: Permitted under the following circumstances:
Hazard & Wind Insurance(s) may be waived with taxes still escrowed. o Note in this scenario, the escrow wavier fee is not applied.
o If HO-6 insurance is required, then it must be escrowed.
The only exception for this is if the association policy includes unit-level ‘walls-in’ coverage.
Escrows may not be waived for any real estate taxes when delinquent taxes past due by more than 60 calendar days are being included in the new loan amount (for cash out refinance transactions).
Refer to the daily rate sheet for non-escrow account loan level price adjustments (LLPAs) to be applied when full escrows are waived
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Loan Details,
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Loan Limits
Property Type General Permanent High Balance
Continental
U.S. Alaska & Hawaii Continental U.S. Alaska & Hawaii
1 Unit $417,000 $625,500 $625,500 $938,250
2 Units $533,850 $800,775 $800,775 $1,201,150
3 Units $645,300 $967,950 $967,950 $1,451,925
4 Units $801,950 $1,202,925 $1,202,925 $1,804,375
NOTE:
Loan amounts may not exceed the applicable maximum loan limits for the specific area in which the property is located.
Maximum loan amounts are limited by MSA/County. The loan limits by county can be located in the Federal Housing Finance Agency website:
http://www.fhfa.gov/DataTools/Downloads/Documents/Conforming-Loan-Limits/Counties_with_increases_cy2015.pdf OR
Fannie Mae’s website at https://commlend.efanniemae.com/loanlimitgeocoder/pages/login.aspx
Occupancy Unless otherwise specifically restricted or not permitted by the applicable
loan parameters, the following property types are acceptable: Primary Residence 1-4 units
Second Home
Investment 1-4 units
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Property
Types Eligible Property Types
Unless otherwise specifically restricted or not permitted by the applicable loan parameters, the following property types are acceptable in
accordance to applicable agency guidelines: 1-4 unit Properties, Attached and Detached Eligible Condominiums
Modular Homes/Factory Built (SFR, 1-unit only) 1 Unit PUDs
Rural Properties
Land Contracts for Sale Mixed Use Properties Leasehold properties
Manufactured Homes (multi-width properties only; FRM and 7/1 & 10/1 ARMs only)
Ineligible Property Types
The following property types are not acceptable: Model Home Leaseback properties
Properties located outside the United States Condotels
Raw Land
Subsidized Condos also known as Limited Equity Condos Cooperative Share Properties (Co-Op)
Properties with ANY resale restrictions (excluding age restricted).
NOTE: For other property types not listed above, refer to the Lending
Guide for eligibility requirements.
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Condo
Properties No new project review is required.
Only required to certify property is not a condominium hotel or motel, houseboat project, timeshare or segmented ownership project. Must confirm hazard insurance, HO-6 insurance, flood insurance,
liability insurance and fidelity insurance (when applicable to each insurance type) coverage as required within the Conventional Lending Guide.
Executed Condo/PUD Warranty form (as published on our website) must be completed and included in the loan file.
For loans being refinanced that are NOT currently serviced by Ocwen Loan Servicing, LLC, Florida condo projects permitted for Primary Residence up to 75% LTV/CLTV and Second Homes up to 65% LTV/CLTV.
Leasehold Properties / Term of Lease
The term of the leasehold estate must run for at least five years beyond the maturity date of the mortgage, unless fee simple title will vest at an earlier date in the borrower.
If the term of the leasehold estate does not extend five (5) years beyond the maturity date of the mortgage, a shorter term
amortization should be considered.
No additional review of the leasehold terms is required under this product type.
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Closing
Documentation All fixed Rate Mortgages sold to Ocwen must use the most current Fannie Mae uniform instruments for the fixed rate Note and for the Security
Instrument.
The respective ARM terms must use the following current Fannie Mae uniform instruments for the adjustable rate Note and Rider:
Term Note Rider
DU Refi Plus Summary
General Underwriting Guidelines
Overview The DU Refi Plus loans require initial submission through Fannie Mae DU;
the agency underwriting guidelines of Fannie Mae must be met, unless otherwise indicated.
NOTE: Manually Underwritten files are not permitted.
Acceptable
AUS Decisions Ocwen will accept Conforming loans only with the following credit recommendations.
AUS Decision Required Eligible
Fannie Mae
DU Approve/Eligible Yes
DU Approve/Ineligible No
DU Refer/Eligible No¹
DU Refer/Ineligible No
DU Refer with Caution No¹
Out of Scope No
NOTES:
1 AUS recommendations are not valid and may NOT be turned into a manual underwrite under
the DU Refi Plus guidelines.
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DU Data Entry DU Refi Plus decisions are identified by the presence of the following
message on the certificate: “This loan case file was underwritten according to the DU Refi Plus expanded eligibility guidelines offered on certain limited cash-out refinance loans case files where the borrower’s existing loan is identified by DU as Fannie Mae loan. This loan case file must be delivered with Special Feature Code 147.”
Documentation
Requirements Required file documentation determined by the applicable DU findings unless otherwise specified within the DU Assisted Loan section.
Credit Minimum 12 month mortgage history and 0x30 lates reported in the
most recent 12 months; applies to all mortgages listed on the borrower’s credit report, regardless of DU.
0x30 not applicable for loans being refinanced that are currently serviced by Ocwen Loan Servicing, LLC; Borrower(s) must only meet DU’s mortgage delinquency policy.
If there are no usable credit scores due to insufficient information or inaccurate information, the loan is ineligible.
Refer to product matrix for specific credit score requirements.
Restructured loans are permitted as long as the new refinance meets all requirements stated herein.
IMPORTANT: Minimum requirements are the MORE restrictive of the
above OR as required by DU recommendations.
Credit
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Bankruptcy /
Foreclosure Standard waiting periods and re-establishment of credit requirements for significant derogatory credit events do not apply to the DU Refi
Plus program.
Any judgments, bankruptcies, foreclosures, or lawsuits indicated in the Declarations section of the loan application does not require further investigation.
If the bankruptcy is discharged, it does not matter if the mortgage being refinanced was included in the Bankruptcy provided the
borrower continued to make the monthly mortgage payments on time.
Borrower
Eligibility For the majority of scenarios, the Borrowers on the existing mortgage should match the borrowers on the new mortgage; however, the below
circumstances are permitted:
A new borrower may be added to the new loan, provided the existing borrower(s) are also in title.
A borrower may be removed from the new loan providing all of the following:
Permits the removal of borrowers for any reason, does not need to solely be due to a death or divorce.
At least one of the original borrower(s) remains on the new loan. Any person who has ownership interest in the subject property must sign the security instrument (or any other document required to perfect the lien position or satisfy any state regulation),
regardless if the person applied for the loan. Maximum of 4 borrowers per transaction.
Customer
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All Income Acceptable Verbal verification of employment in addition to the specific
income documentation detailed within this summary.
IMPORTANT:
The below income documentation requirements detailed within this product summary are to be used and supersede DU Findings in all cases of DU Refi Plus products.
For any income type NOT specifically addressed below,
documentation as required within the Conventional Lending Guide must be included in the loan file.
Base Pay Base Pay (salary or hourly) requires One Acceptable YTD Paystub
documenting 30 days of income, dated no earlier than 30 days prior to the initial loan application date and no more than 90 days old on the date the Note is signed.
Paystub must clearly identify the borrower as the employee, with all necessary information to calculate income, including gross YTD earnings, base salary with pay period specified, and must clearly specify the employer’s name.
NOTE:
Applies to primary employment, secondary employment (second job and multiple jobs), bonus, overtime, tip, automobile allowance and seasonal income.
Bonus and/or overtime income must be annualized for qualifying purposes.
DU Messaging regarding Secondary Employment Income Duration documentation requirements may be disregarded in its entirety.
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Commission
Income A YTD paystub documenting at least 30 days of income, dated no earlier than 30 days prior to the initial loan application date and no
more than 90 days old on the date the note is signed is required. Paystub must clearly identify the borrower as the employee, with all necessary information to calculate income, including gross YTD earnings, base salary with pay period specified, and must clearly specify the employer’s name; OR
Copies of the most recent one year filed personal income tax returns signed by the borrower (s).
Self-Employment Copies of the most recent one year filed Personal income tax returns sign by the borrower (s).
Verification of existence of the business through a third party source no more than 30 calendar days prior to the Note Date.
NOTE: DU Messaging regarding Self-Employment Duration
documentation requirements may be disregarded in its entirety.
Alimony or
Child Support Copy of the divorce decree or property settlement agreement, court order or equivalent documentation.
One month documentation of receipt. (i.e. bank statement showing direct deposit, deposit ticket, etc.).
NOTE: DU Messaging regarding minimum 6 month documentation and
three year continuance may be disregarded.
Employment-Related Assets as Qualifying Income
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Rental Income Acceptable Lease or one year personal tax return (Form 1007 is not
required). Applies to rental income from subject or other properties owned by the borrower.
NOTE: Any DU Message requirements regarding principal residence
conversion documentation may be disregarded.
Retirement
and Pension One of the following: award letter, one year personal tax return, W-2 or 1099 form, or one month bank statement reflecting direct deposit. NOTE: DU Messaging regarding three year continuance may be
disregarded.
Social Security One of the following: award letter, one year personal tax return, Form
SSA- 1099, or one month bank statement reflecting direct deposit.
Temporary
Leave Income A paystub or written VOE documenting pre-leave income.
The borrower’s written confirmation of his or her intent to return to work,
No evidence or information from the borrower’s employer indicating that the borrower does not have the right to return to work after the leave period.
Regardless of the date of return, the amount of the “regular
employment income” the borrower received prior to the temporary leave must be used to qualify.
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Unemployment
Income Unemployment benefits may be used in qualifying an applicant for a
DU Refi Plus loan whether the benefits are seasonal or non-seasonal. Most recent one-month bank statement or other equivalent
documentation evidencing receipt of the income, or
Other third-party documentation showing income type, source, amount;
NOTE: Lenders are not required to establish a minimum history of
receiving income or make a determination that the income can be expected to continue for at least three years
Projected
Income Future income is not acceptable for qualifying purposes.
IRS Form
4506-T Required to be signed at application and closing; however, not to be processed.
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Housing
History 0x30 days lates in the most recent 12 months on any mortgage trade lines.
Not applicable for loans being refinanced that are currently serviced by Ocwen Loan Servicing, LLC.
Payoff statement required to be documented in the loan file.
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Assets If asset verification is required per DU, the most recent one month,
quarterly, or annual statement showing the asset balance is required.
IMPORTANT: A written VOD is not acceptable without bank
statements.
Large deposits that appear on bank or other asset statements for DU Refi Plus loans does not require further investigation or
documentation.
Proof of liquidation of assets (i.e. sale of stock) is not required even if the borrower uses those assets for closing costs.
Self-employed borrowers may use business funds to satisfy the asset verification requirements regardless of percentage of business
ownership.
Grant-like unsecured financing provided to the borrower through a HFA's HHF (Hardest Hit Funds) program for the purpose of paying down the outstanding mortgage balance at the time of closing
resulting in a lower new loan amount is permitted. The HHFs may also be used for the payment of closing costs.
The following requirements apply to HHFs:
The funds must be reflected in the Uniform Residential Loan Application (Form 1003 or 1003(S)) (and in the online loan application for DU Refi Plus) in Section VII, Details of Transaction as an Other Credit.
The loan file must be documented with a copy of the promissory note or other documentation specifying the terms and conditions of the loan.
If repayment of the HHF is indicated in the supporting
documentation, the monthly payment must be included in the debt to income ratio unless repayment is only due upon sale or default. The transfer of the loan proceeds must be reflected on the Closing
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DU Estimated
Value Message IMPORTANT: DU Estimated Value Message to be retired and will no longer be issued with DU Version 9.1 loans.
When FNMA is able to confirm the property address with the USPS database and FNMA’s databases have sufficient information on the property to issue a value, DU will issue the following:
“Based on the standardized address, DU estimates the value of the property at $<estimated value>. This estimated value was developed by internal proprietary models to help determine eligibility for a DU Refi Plus property fieldwork waiver. It is not the result of an appraisal nor was it developed by a state licensed or certified appraiser. This estimate is intended to be used solely by the lender to underwrite the refinance of the borrower’s mortgage loan.”
IMPORTANT: The loan case file does not need to be resubmitted using
the estimated value provided by DU. The waiver should be exercised using the value that was initially entered into DU.
PIW Offering Final submission of the loan case file to DU must indicate a PIW is
permitted.
The PIW offering may not be more than four months old on the date of the note and mortgage.
During any post-closing corrections/modifications, if the re-run DU recommendation subsequently requires a full appraisal, then a full appraisal must be obtained.
NOTE: Utilization of appraisal waivers requires the borrower to be
provided and sign the Notice About Appraisal of Your Property disclosure. Year built must be listed on the 1003 application.
Not permitted for Manufactured Homes.
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Full Appraisal
Requirements Property fieldwork/appraisal type is acceptable as issued by DU.
Property Condition/Quality Rating for loans being refinanced that are currently serviced by Ocwen Loan Servicing, LLC
If an appraisal is obtained, Ocwen will accept appraisal reports with a property condition rating of C6 and/or quality rating of Q6 completed on an “as-is” basis. The appraisal does not have to be completed “subject to” repairs being made.
For Investment properties, a Form 1007 Comp Rent Schedule is not required.
Property Condition/Quality Rating for loans being refinanced that are currently NOT serviced by Ocwen Loan Servicing, LLC
If an appraisal is obtained, Ocwen will only purchase loans where the appraisal is completed “as is” with the property’s conditions rating C1 – C5 and the quality of construction rating Q1- Q5.
IMPORTANT: For Manufactured Homes, a full appraisal Form FHLMC
70B or FNMA 1004c is required.
Transferred
Appraisals Not Permitted.
Bedroom Count & Monthly Rents
In ALL situations, FNMA requires the Bedroom Count AND Estimated Monthly Rents to be captured for All Investment properties.
This information may be obtained from any viable source and must be documented on the 1008 by the Underwriter.
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Manufactured Homes
Defined
A manufactured home is described as a dwelling built on a permanent chassis and attached to a permanent foundation. The manufactured home and the land on which it is situated must be titled as real property.
Other factory-built housing (not built on a permanent chassis) – such as modular, prefabricated, panelized, or sectional housing – is not considered manufactured housing and is eligible for purchase by Ocwen.
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Manufactured Home
Property Requirements
The borrower must own the land on which the manufactured home is situated in fee simple, unless the manufactured home is located in a condo project; leasehold properties are not permitted.
The manufactured home must be a one-unit dwelling unit that is legally classified as real property.
The towing hitch, wheels, and axles must be removed.
The dwelling must assume the same characteristics of site-built housing.
Multi-width manufactured homes may be located either on an individual lot or in a project development.
Condo project developments must be Fannie Mae-approved.
The manufactured home must have sufficient square footage and room dimensions to be acceptable to typical purchasers in the subject market area.
The manufactured home must be defined as a double-wide home.
Fannie Mae does not specify other minimum requirements for size, roof pitch, or any other specific construction details for HUD-coded manufactured homes.
The manufactured home must be built in compliance with:
The Federal Manufactured Home Construction and Safety Standards that were established June 15, 1976 as amended and in force at the time the home is manufactured; and
Additional requirements that appear in HUD regulations at 24 C.F.R. Part 3280.
NOTE: Compliance with these standards will be evidenced by the
presence of both a HUD Data Plate and the HUD Certification Label (tag).
Site preparation for delivery of the manufactured home must be completed.
The manufactured home must be attached to a permanent foundation system in accordance with the manufacturer’s requirements for anchoring, support, stability, and maintenance.
The foundation system must be appropriate for the soil conditions for the site and meet local and state codes.
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Manufactured Home
Appraisal Requirements
The manufactured home appraisal must be completed on Form 1004C,
Manufactured Home Appraisal Report. Manufactured homes are not eligible for
streamlined appraisals.
Fannie Mae’s appraisal report forms require appraisers to develop an opinion of value solely for the real property as completed consisting of the manufactured home, site improvements, and the land on which the home is situated.
Fannie Mae requires market-based property valuations for manufactured homes demonstrated by a well-developed sales comparison approach to value that is further supported by the cost approach to value.
NOTE: See below for discussion regarding the cost approach to value.
An appraiser who is unable to locate sales of manufactured homes that are truly comparable to the subject property may decide that it is appropriate to use either older sales of similar manufactured homes or sales of similar manufactured homes that are located in a competing market so that he or she can establish a baseline for the “sales comparison analysis” and determine sound adjustments to reflect the differences between the comparable sales that are available and the subject property.
The appraisal must address more directly, in a standardized format construction quality, property condition, market acceptance, indicated value by the cost approach, and support for the contributory value of the site.
The property site must be of a size, shape, and topography that is conforming and acceptable in the market area.
The appraisal report also must indicate whether or not the site is compatible with the neighborhood.
The property site must have competitive utilities, street improvements, adequate vehicular access, and other amenities.
The appraiser must comment on the conformity of the manufactured home to other manufactured homes in the neighborhood.
The appraiser must address both the marketability and comparability of a
manufactured home by selecting comparable sales of similar manufactured homes. Since amenities, easements, and encroachments may either detract from or
enhance the marketability of a site, the appraiser must reflect them in the analysis and valuation.
If the site has adverse conditions or is not typical for the neighborhood, the appraiser must comment.
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Manufactured Home Security Instrument, Title Insurance and Other Legal Requirements
Manufactured housing security instrument must include the following information:
Year manufactured Make
Model
Serial number/VIN number(s)
Any other information required by applicable law.
One of the following title policy endorsements must be provided for a Manufactured Home:
An ALTA Form 7.1, where available, or ALTA Form 7 endorsement, or An endorsement required in the applicable jurisdiction that insures
that the Manufactured Home constitutes real property, such as the T-31 endorsement in the State of Texas.
Subject property must be taxed as real estate or personal property according to state law and local taxing authority.
FEMA Declared
Disaster Areas Regardless of the Property Fieldwork requirements used for the DU Refi Plus loan, an additional inspection and/or new appraisal of the
property are not necessary after a disaster.
A property secured by a DU Refi Plus mortgage that was damaged as a result of a disaster will not be required to be repaired prior to closing as long as the loan meets the property insurance requirements for Hazard Insurance and Flood Insurance as stated within the
Conventional Lending Guide.
Provided DU offers the property fieldwork waiver on the final
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Validation
Requirements Ocwen will assess all properties and appraisals to confirm values are well supported. It will be at the Underwriter’s discretion to utilize any
additional validation tools at their disposal to escalate value concerns.
Escrow
Holdbacks Holdbacks of any kind are not permitted.
Interest Only
Option Not Permitted
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Mortgage
Insurance The DU Findings will state if the current loan has Mortgage insurance. The MI Company and the percentage of coverage will be identified in the
findings.
Must obtain the mortgage insurance on the new loan from the same company that is insuring the loan being paid off. The percentage of coverage, frequency and renewal type MUST remain the same on the new loan.
If the loan being refinanced currently has Mortgage Insurance and the new loan has a LTV greater than 80% LTV, then the new loan will require Mortgage Insurance.
Underwriter must process or work with the MI Partner to process the MI transfer/modification.
Must provide the MI Certification in the closed loan file reflecting the appropriate coverage amount.
Lender Paid Monthly MI premiums are not eligible unless Ocwen is
servicing the loan that is being refinanced. Premium types may be
modified to borrower paid options if correctly disclosed and accepted by the borrower.
IMPORTANT: MI Partners can take 30 days or more to process a same
servicer HARP modification request; Brokers are responsible for managing expectations (i.e. rate lock expiration) accordingly.
Instructions for completing HARP modification request with each MI Partner:
Genworth http://mortgageinsurance.genworth.com/RatesAndGuidelines/MakingHomeAffordable.aspx United Guaranty https://www.ugcorp.com/services/affordability.html MGIC http://www.mgic.com/underwriting/refi-to-mod.html Radian http://www.radian.biz/page?name=HASPSameServicerPerf
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Multiple
Properties There is not a limit on the number of financed properties for DU Refi Plus eligible loans, regardless of occupancy type.
Non-Occupant
Co-Borrowers An existing borrower may be removed from the new loan for any reason provided at least one of the original borrower(s) remains on
the new loan. Any person who has ownership interest in the subject property must sign the security instrument (or any other document required to perfect our lien position or satisfy an Regulation), regardless if the person applied for the loan.
Borrowers may be added in the new transaction provided the original borrowers remain on the loan.
Non-Traditional Credit History
Not Permitted.
NOTE: If there are no usable credit scores due to insufficient information
or inaccurate information, the loan is ineligible.
Qualifying
Ratios Ocwen will accept loans with the maximum Debt-To-Income (DTI) ratios accepted by the DU’s approve/eligible recommendation:
The loan characteristics are... Maximum DTI
DU Refi Plus As permitted by DU recommendations
For ARMs:
5/1: Greater of Note Rate + 2.00% OR the Fully Indexed Rate
7/1, 10/1: Greater of Note Rate OR the Fully Indexed Rate
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Refinance
Requirements Refinance under the DU Refi Plus may include the following:
Pay off the existing first mortgage
Closing costs, prepaid costs and discount points
The borrower may receive up to $250 at closing from loan proceeds (not permitted to come from premium pricing) (excluding Texas primary residence in which the borrower may not receive any cash back). If the amount exceeds $250, then refer to the next bullet point regarding principal curtailments.
A Principal Curtailment to the new refinance mortgage at closing is allowed for the excess funds and must be clearly reflected on the Closing Disclosure (or HUD-1 form) or other equivalent closing statement. Not permitted for Borrower Paid Transactions. Texas Section 50a6 scenarios are not permitted.
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Net Tangible
Benefit Transaction must represent a net tangible benefit to the borrower and be documented by the Underwriter on the 1008. IMPORTANT: DU does not have the ability to make the determination that
the transaction will benefit the borrower. This review must be performed manually by the Underwriter.
The monthly principal and interest payment is decreasing.
Payment increases are only permitted if the loan is refinancing into a more stable product (i.e. ARM to Fixed, IO to fully amortizing, shorter term, etc.).
If the mortgage loan type changes from a FRM to an ARM, a reduction in principal and interest payment is required.
NOTE: Movement from a FRM to an ARM is not considered a
movement to a more stable mortgage product. It is encouraged to provide a FRM mortgage to borrowers whenever possible. FRM mortgages are required if the LTV ratio exceeds 105%.
The amortization period is shortened. Interest rate is reduced
The amortization period is extended (i.e. from 15 to 30 years) provided there is a reduction in the principal and interest payment. An extension of the amortization period is not considered
movement to a more stable product; the reduction of P&I MUST be present as well.
Listed for Sale Properties that have been listed for sale are eligible if the property has
been removed from the market prior to the application date AND the borrower confirms intent to continue to occupy if the subject property is their primary residence.
NOTE: Policy does not apply to scenarios without appraisals, including
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General Underwriting Guidelines,
Continued
Subordinate
Financing Existing subordinate financing can remain in place so long as it is re-subordinated to the new DU Refi Plus mortgage loan.
Existing subordinate financing may not be paid down or satisfied with the proceeds of the new DU Refi Plus mortgage.
New subordinate financing is only permitted if it replaces existing subordinate financing
If the existing subordinate financing is simultaneously refinanced with new subordinate financing, the new subordinate lien amount cannot exceed the existing amount.
The monthly payments on the subordinate financing must be included in the housing ratio;
Must disclose the existence of all subordinate financing and calculate LTV/CLTV/HCLTV.
Must have a re-subordination agreement executed and recorded, unless state law permits subordinate financing to remain in the same subordinate lien position.
Interest Credit Permitted up to the 10th day of the month.
DU Refi Plus Summary
Restrictions
StateRestrictions California: Preliminary title commitments are required. Illinois:
All refinances require a net tangible benefit form to be calculated by the underwriter; signed by both the Underwriter and Borrower(s).
Cook, Kane, Peoria or Will Counties Only:
Mortgage must be recorded with either a Certificate of Compliance or a Certificate of Exemption as applicable.
High level steps: originator uses loan application to enter required information into the database; database will determine if the property is exempt; if not exempt, the database will then determine if it will be necessary for the borrower to obtain counseling; proof of exemption, if applicable, must be printed and provided within the loan file. Refer to https://www.ilapld.com for instructions from the state.
Borrower Certification stating that counseling is not required as Ocwen does not offer loan products or allow closing scenarios that would trigger state required counseling.
Maryland: All refinances require a net tangible benefit form to be disclosed to and signed by the borrower.
Rhode Island: All refinances must include a state specific net tangible benefit form disclosed to and signed by the borrower.
Texas:
Texas Section 50a6 loans or refinances of previous Texas Section 50a6 loans are NOT permitted.
Ocwen currently lends in the states of Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, DC, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Michigan, Minnesota, Mississippi,
Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota,
Tennessee, Texas, Utah, Vermont, Washington, West Virginia, Wisconsin and Wyoming.
DU Refi Plus Summary
DU Refi Plus
Loan Parameters – Agency DU Refi Plus
DU Refi Plus
# of
Units Primary Residence Maximum Second Home
2
Maximum Investment Property Maximum Minimum Credit
Score
LTV CLTV 1 HCLTV1 LTV CLTV HCLTV LTV CLTV HCLTV
Limited Cash Out Refinance Transactions
FOR LOANS BEING REFINANCED THAT ARE NOT CURRENTLY SERVICED BY OCWEN LOAN SERVICING, LLC3:
1-4 150.00 Unlimited Unlimited NA NA NA NA NA NA 660
1 NA NA NA 100.00 Unlimited Unlimited NA NA NA 700
1-4 NA NA NA NA NA NA 100.00 Unlimited Unlimited 700
FOR LOANS BEING REFINANCED THAT ARE CURRENTLY SERVICED BY OCWEN LOAN SERVICING, LLC:
1-4 Per DU Per DU Per DU Per DU Per DU Per DU Per DU Per DU Per DU Per DU
Cash-Out Refinance Transactions
ALL NA NA NA NA NA NA NA NA NA NA
NOTES:
All States: Type F PUDs are not permitted.
1 Refer to the Subordinate Financing section within this product summary for all details.
2 1-Unit only for Second Homes.
3 Condo Properties: For loans being refinanced that are NOT currently serviced by Ocwen Loan Servicing, LLC, Florida condo
projects permitted for Primary Residence up to 75% LTV/CLTV and Second Homes up to 65% LTV/CLTV.
