While the US housing market has remained surprisingly resilient price-wise in the face of 7% mortgage rates, which the Fed has pushed to near-Volcker levels precisely in hopes of accelerating the dis inflationary wave by crushing housing, that single most valuable asset of the US middle class, the reality why prices have not collapsed is that the bid-ask spread for any home currently for sale has ballooned to levels where the market is effectively frozen as there is simply no possibility for the bid and ask to meet somewhere “in the middle” of the range (those who are hoping to buy are already tapped out before being asked to pay even more, while sellers are already wealthy and absent a liquidity crunch see no reason to sell a home at what they view as fires ale prices).

Overnight, real-estate brokerage Redfin calculated just how widespread said paralysis is: it found that just 14 of every 1,000 U.S. homes changed hands during the first six months of 2023. That’s down from 19 of every 1,000 during the same period of 2019 and the lowest turnover rate in at least a decade, since Redfin’s records started. That means prospective homebuyers have 28% fewer homes to choose from than they did before the pandemic upended the U.S. housing market.

Redfin uses turnover as a measure of housing availability; it indicates how often homes change hands in a given area.  This analysis includes overall for-sale housing turnover and breakdowns based on neighborhood type and home type.

The pre-pandemic turnover rate noted above (roughly 20 of every 1,000 sellable homes change hands in the first half of a year) is fairly typical for the modern housing market, but a more active market would have a rate closer to 40 or 50 of every 1,000.

As Redfin adds, the wild pandemic-era housing market has intensified an existing shortage of homes for sale and led to this year’s low turnover rate. In 2018, Freddie Mac estimated that about 2.5 million more homes needed to be built to meet demand, with the shortfall mainly due to a lack of construction of single-family homes. The homebuying boom of late 2020 and 2021, driven by record-low mortgage rates, remote work and a surge in investor purchases, depleted already low inventory levels. Finally, 2022’s soaring mortgage rates–average rates nearly doubled from January to June–exacerbated the shortage by handcuffing homeowners to their comparatively low rates. Some homeowners have opted to renovate their current home, and some are buying another home but hanging onto their first one and renting it out to either a longterm tenant or short-term vacationers. Now, the supply of homes for sale is at a record low.

“The quick increase in mortgage rates created an uphill battle for many Americans who want to buy a home by locking up inventory and making the homes that do hit the market too expensive. The typical home is selling for about 40% more than before the pandemic,” said Redfin Deputy Chief Economist Taylor Marr. “Mortgage rates dropping closer to 5% would make the biggest dent in the affordability crisis by freeing up some inventory and bringing monthly payments down. But there are a few other things that would boost turnover and help make homes more affordable. Building more housing is imperative, and federal and local governments can help by reforming zoning and making the building process easier. Financial incentives, like reducing transfer taxes for home sellers and subsidizing major moves with tax breaks, would also add to supply.”

Suburbs hardest hit

House hunters searching for large homes in the suburbs have seen the biggest drop in their options. Just about 16 of every 1,000 four-bedroom-plus suburban single-family homes sold in the first half of this year, down from 24 of every 1,000 that sold in the same period in 2019. That means buyers of that home type have 33% fewer houses to choose from.

The turnover rate has dropped for every size home in every type of neighborhood over the last four years (though buyers will have an easier time finding something for sale in certain metro areas, as outlined below). That trend can be seen in the chart above, which displays the national post-pandemic housing turnover rate on the left and the pre-pandemic rate on the right. The length of the line between the two dots indicates how much turnover declined from 2019 to 2023, with the biggest declines at the top.

The turnover rate of large single-family suburban homes has shrunk most because that type of home exploded in popularity during the pandemic. Remote workers flocked to the suburbs, untethered from the office, and purchased large properties with space for adults to work from home and children to attend school from home.

“New listings normally hit the market on Thursdays, and I have buyers who are excitedly checking their Redfin app Thursday mornings, only to find nothing new,” said Phoenix Redfin Premier agent Heather Mahmood-Corley. “That goes for buyers in every price range in every type of neighborhood, but what people want most are those move-in ready, mid-sized homes in neighborhoods with highly rated schools. Those are hardest to find because for people to buy one, someone needs to sell one. That’s not happening, because so many of those homeowners have low mortgage rates.”

The turnover rate of condos and townhomes didn’t shrink as much as that of single-family homes during the pandemic, though condo and townhouse buyers are still about 20% less likely to find that type of home than they were in 2019.

Supply of that home type wasn’t depleted as much because there wasn’t as much demand for them during the pandemic. In fact, many remote workers were selling condos and townhouses in favor of single-family homes with more space.

Modestly sized single-family homes in the city are hardest to find: Just 11 of every 1,000 two- and three-bedroom urban houses sold in the first half of this year

Smaller houses in the city have the lowest turnover rate of all the home types in this analysis.  Roughly 11 of every 1,000 two- and three-bedroom single-family homes in urban neighborhoods sold in the first six months of 2023, compared to 14 of every 1,000 during the same period in 2019.

Two- to three-bedroom homes in suburban neighborhoods are essentially tied with their urban counterparts for the lowest turnover rate, with 11 of every 1,000 changing hands this year. That’s down from 16 of every 1,000 in 2019.

Modestly sized single-family homes in all kinds of neighborhoods have long been hard for buyers to find. That’s because builders don’t make many of them anymore, and homeowners tend to hold onto the ones that exist.

Today’s homebuilders tend to focus on the kind of home that’s in demand and profitable: Larger single-family homes, which don’t cost much more to build than smaller ones but sell for more money, and condos and townhouses, which cost less to build. And people who own those starter-type homes often turn them into rental properties rather than selling when they move up to bigger houses.  Homeowners can often cover their mortgage and then some when renting out this type of home, especially in desirable neighborhoods; that income paired with the home’s value increasing over time incentivizes keeping rather than selling.

Homebuyers have the smallest pool of options in the Bay Area: Just 6 of every 1,000 San Jose homes have turned over to a new owner this year

Northern California has the lowest turnover rate in the U.S. Just six of every 1,000 homes in San Jose changed hands in the first half of 2023, the lowest rate of the 50 most populous U.S. metros. It’s followed closely by Oakland, San Diego, Los Angeles, Sacramento and Anaheim, all places where about eight of every 1,000 homes turned over to a new owner.

The pandemic exacerbated the supply shortage throughout California, with the turnover rate dropping by at least 30% in each of those metros from 2019 to 2023.

Zooming in on large, suburban single-family homes, California still has the lowest turnover rate. Six of every 1,000 homes of that type have sold this year in San Jose (-40% since 2019), the lowest rate in the nation. Next come Oakland (7 of every 1,000; -43%), San Diego (8 of every 1,000; -51%), Sacramento (9 of every 1,000; -41%) and Anaheim (9 of every 1,000; -41%).

Homebuyers have the biggest pool of options in Newark, NJ and Nashville, where more than 23 of every 1,000 homes have changed hands this year

Newark, NJ has the highest turnover rate in the U.S., with 24 of every 1,000 homes changing hands during the first six months this year. It’s followed closely by Nashville, TN (23 of every 1,000) and Austin, TX (22 of every 1,000). Nashville and Austin are also two of the three metros (along with Fort Worth, TX) with the highest turnover for large suburban, single-family homes.

Newark buyers still have far fewer homes to choose from than they did before the pandemic, with a 42% drop in turnover since 2019. Only New Brunswick, NJ (-49%) and San Diego (-46%) had bigger declines. Zooming in on large suburban houses, New Brunswick (-55%), Chicago (-54%) and New York (-52%) had the biggest drops in turnover.

But Nashville and Austin are both among the five metros with the smallest declines in turnover since 2019, posting drops of just 10% and 14%, respectively. When it comes to large suburban houses, Nashville and Austin have the second and third smallest declines. That’s partly due to robust new construction in Nashville and Austin: Inventory of single-family homes for sale in both metros is made up of more than 30% newly built homes, compared to 22% nationwide.

Only Milwaukee and Columbus, OH, which both saw overall turnover drop by about 8% from 2019 to 2023, had smaller declines in turnover than Nashville. Indianapolis, IN comes in fourth, with a 14% decline. Milwaukee, Columbus and Indianapolis have relatively stable turnover because they didn’t experience huge homebuying demand swings throughout the pandemic.

Source : https://www.zerohedge.com/economics/complete-paralysis-just-1-us-homes-have-changed-hands-2023-lowest-share-record

Vol. 83 Monday, No. 112 June 11, 2018 Part IX Department of Housing and Urban Development Semiannual Regulatory Agenda VerDate Sep<11>2014 20:24 Jun 08, 2018 Jkt 244001 PO 00000 Frm 00001 Fmt 4717 Sfmt 4717 E:\FR\FM\11JNP9.SGM 11JNP9 daltland on DSKBBV9HB2PROD with PROPOSALS3 27148 Federal Register / Vol. 83, No. 112 / Monday, June 11, 2018 / Unified Agenda DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT 24 CFR Subtitles A and B [Docket No. FR–6087–N–01] Semiannual Regulatory Agenda AGENCY: Department of Housing and Urban Development. ACTION: Semiannual regulatory agenda. SUMMARY: In accordance with section 4(b) of Executive Order 12866, ‘‘Regulatory Planning and Review,’’ as amended, HUD is publishing its agenda of regulations already issued or that are expected to be issued during the next several months. The agenda also includes rules currently in effect that are under review and describes those regulations that may affect small entities, as required by section 602 of the Regulatory Flexibility Act. The purpose of publication of the agenda is to encourage more effective public participation in the regulatory process by providing the public with advance information about pending regulatory activities. FOR FURTHER INFORMATION CONTACT: Aaron Santa Anna, Assistant General Counsel for Regulations, Office of General Counsel, Department of Housing and Urban Development, 451 7th Street SW, Room 10276, Washington, DC 20410–0500; telephone number 202–708–3055. (This is not a toll-free number.) A telecommunications device for hearingand speech-impaired individuals (TTY) is available at 800–877–8339 (Federal Relay Service). SUPPLEMENTARY INFORMATION: Executive Order 12866, ‘‘Regulatory Planning and Review’’ (58 FR 51735, October 4, 1993), as amended, requires each department or agency to prepare semiannually an agenda of: (1) Regulations that the department or agency has issued or expects to issue, and (2) rules currently in effect that are under departmental or agency review. The Regulatory Flexibility Act (5 U.S.C. 601–612) requires each department or agency to publish semiannually a regulatory agenda of rules expected to be proposed or promulgated that are likely to have a significant economic impact on a substantial number of ‘‘small entities,’’ meaning small businesses, small organizations, or small governmental jurisdictions. Executive Order 12866 and the Regulatory Flexibility Act permit incorporation of the agenda required by these two authorities with any other prescribed agenda. HUD’s regulatory agenda combines the information required by Executive Order 12866 and the Regulatory Flexibility Act. HUD’s complete Unified Agenda is available online at www.reginfo.gov, in a format that offers users a greatly enhanced ability to obtain information from the Agenda database. The Department is subject to certain rulemaking requirements set forth in the Department of Housing and Urban Development Act (42 U.S.C. 3531 et seq.). Section 7(o) of the Department of Housing and Urban Development Act (42 U.S.C. 3535(o)) requires that the Secretary transmit to the congressional committees having jurisdictional oversight of HUD (the Senate Committee on Banking, Housing, and Urban Affairs and the House Committee on Financial Services), a semiannual agenda of all rules or regulations that are under development or review by the Department. A rule appearing on the agenda cannot be published for comment before or during the first 15 calendar days after transmittal of the agenda. Section 7(o) provides that if, within that period, either committee notifies the Secretary that it intends to review any rule or regulation that appears on the agenda, the Secretary must submit to both committees a copy of the rule or regulation, in the form that it is intended to be proposed, at least 15 calendar days before it is to be published for comment. The semiannual agenda posted on www.reginfo.gov is the agenda transmitted to the committees in compliance with the above requirements. HUD has attempted to list in this agenda all regulations and regulatory reviews pending at the time of publication, except for minor and routine or repetitive actions, but some may have been inadvertently omitted, or may have arisen too late to be included in the published agenda. There is no legal significance to the omission of an item from this agenda. Also, where a date is provided for the next rulemaking action, the date is an estimate and is not a commitment to act on or by the date shown. In some cases, HUD has withdrawn rules that were placed on previous agendas for which there has been no publication activity. Withdrawal of a rule does not necessarily mean that HUD will not proceed with the rulemaking. Withdrawal allows HUD to assess the subject matter further and determine whether rulemaking in that area is appropriate. Following such an assessment, the Department may determine that certain rules listed as withdrawn under this agenda are appropriate. If that determination is made, such rules will be included in a succeeding semiannual agenda. In addition, for a few rules that have been published as proposed or interim rules and which, therefore, require further rulemaking, HUD has identified the timing of the next action stage as ‘‘undetermined.’’ These are rules that are still under review by HUD for which a determination and timing of the next action stage have not yet been made. The purpose of publication of the agenda is to encourage more effective public participation in the regulatory process by providing the public with early information about the Department’s future regulatory actions. HUD invites all interested members of the public to comment on the rules listed in the agenda. J. Paul Compton, Jr., General Counsel. OFFICE OF HOUSING—COMPLETED ACTIONS Sequence No. Title Regulation Identifier No. 137 ……………….. 24 CFR 3280 Manufactured Home Construction and Safety Standards 3rd Set (FR–5739) ……………………. 2502–AJ34 VerDate Sep<11>2014 20:24 Jun 08, 2018 Jkt 244001 PO 00000 Frm 00002 Fmt 4701 Sfmt 4702 E:\FR\FM\11JNP9.SGM 11JNP9 daltland on DSKBBV9HB2PROD with PROPOSALS3 Federal Register / Vol. 83, No. 112 / Monday, June 11, 2018 / Unified Agenda 27149 DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (HUD) Office of Housing (OH) Completed Actions 137. Manufactured Home Construction and Safety Standards 3rd Set (FR–5739) E.O. 13771 Designation: Regulatory. Legal Authority: 42 U.S.C. 5401 et seq.; 42 U.S.C. 3535(d) Abstract: This proposed rule would amend the Federal Manufactured Home Construction and Safety Standards by adopting certain recommendations made to HUD by the Manufactured Housing Consensus Committee (MHCC). The National Manufactured Housing Construction and Safety Standards Act of 1974 (the Act) requires HUD to publish all proposed revised construction and safety standards submitted by the MHCC. This proposed rule is based on the third set of MHCC recommendations to update and improve various aspects of the Manufactured Housing Construction and Safety Standards. HUD has reviewed those proposals and has made several editorial revisions to the proposals which were reviewed and accepted by the MHCC. This rule proposes to add new standards that would establish requirements for carbon monoxide detection, stairways, fire safety considerations for attached garages, and for duplexes. Completed: Reason Date FR Cite Withdrawn ……….. 04/04/18 Regulatory Flexibility Analysis Required: Yes. Agency Contact: James Martin, Phone: 202 708–6423. RIN: 2502–AJ34 [FR Doc. 2018–11248 Filed 6–8–18; 8:45 am] BILLING CODE 4210–67–P VerDate Sep<11>2014 20:24 Jun 08, 2018 Jkt 244001 PO 00000 Frm 00003 Fmt 4701 Sfmt 9990 E:\FR\FM\11JNP9.SGM 11JNP9 daltland on DSKBBV9HB2PROD with PROPOSALS3

Source: https://www.gpo.gov/fdsys/pkg/FR-2018-06-11/pdf/2018-11248.pdf

Selling Guide Announcement SEL-2018-05

June 5, 2018

Selling Guide Updates The Selling Guide has been updated to include changes to the following:

MH Advantage™ Properties

Inspection of Manufactured Homes with Structural Modifications

Project Standards Updates

Flash Settlement for MBS

Desktop Underwriter® (DU®) Bankruptcy and Mortgage Delinquency Assessment

HomeStyle® Energy in DU

HomeStyle Renovation Forms

Miscellaneous Selling Guide Updates

Each of the updates is described below. The affected topics for each policy change are listed on the Attachment. The Selling Guide provides full details of the policy changes. The updated topics are dated June 5, 2018. The highlighted Selling Guide PDF is back by popular demand! Beginning with the June 2018 Selling Guide update, Fannie Mae is again providing a highlighted version of the Selling Guide PDF to enable a simple way to quickly identify the most recent significant updates made to the Selling Guide. The topic title and edited paragraphs are highlighted in yellow to help you identify where changes were made. (Note that deleted topics and paragraphs are not identified.) The highlighted Selling Guide PDF is intended to be used as a companion tool in conjunction with your review of the corresponding Selling Guide Update Announcement. MH Advantage Properties We are pleased to introduce the MH Advantage initiative. MH Advantage is manufactured housing that is designed to meet specific construction, architectural design, and energy efficiency standards that are more consistent with site built homes. The goal of this initiative is to help bridge the gap in affordable housing by encouraging more consumers to consider manufactured homes as an alternative to site built homes. Loans secured by MH Advantage properties are afforded a number of flexibilities over standard manufactured housing, including higher LTV ratios, standard mortgage insurance, and reduced loan-level price adjustments. Examples of the physical characteristics for MH Advantage include  specific architectural and aesthetic features, such as distinctive roof treatments (eaves and higher pitch roofline), lower profile foundation, garages or carports, porches, and dormers;  construction elements including durability features, such as durable siding materials; and  energy efficiency standards (minimum energy ratings apply). MH Advantage is open to all manufacturers. Participating manufacturers will enter into an agreement with us allowing them to attach an “MH Advantage Sticker” to the home in proximity to the home’s HUD Data Plate. The Sticker identifies the home as having been designed to accommodate the physical characteristics for an MH Advantage property. The lender will confirm the presence of the Sticker, and additional information about site improvements to the property, but is not responsible for confirming the physical characteristics of the home.

Requirements for Loans Secured by MH Advantage Properties The following table describes the requirements for delivery of loans secured by MH Advantage properties. Requirements Property Eligibility The lender must confirm the following by reviewing photographs in the appraisal report:  the property is MH Advantage as evidenced by MH Advantage Sticker;  the HUD Data Plate and HUD certification labels are present;  the presence of a driveway leading to the home (or to the garage or carport, if one is present); and  the presence of a sidewalk connecting either the driveway, or a detached garage or carport Appraisal  Manufactured Home Appraisal Report (1004C), and  Completion Report (1004D), if applicable Eligible Transactions  MH Advantage loans follow the same DU eligibility requirements as manufactured homes, with the exception that the maximum LTV ratio is increased to 97% for certain purchases and limited cash-out refinances. All requirements that pertain to loans with LTV ratios 95.01 – 97% apply.  The CLTV ratio may be up to 105% with Community Seconds.  Loans may be originated as HomeReady and subject to all HomeReady requirements.  HomeStyle Renovation and HomeStyle Energy may also be combined with MH Advantage. Underwriting  Lenders must use DU to underwrite.  The “Manufactured Home: MH Advantage” Subject Property Type must be used (even if the property is in a project). Mortgage Insurance MH Advantage loans are subject to standard mortgage insurance coverage requirements; the deeper coverage required for manufactured homes does not apply. Delivery A new Special Feature Code (SFC) 859 is required at delivery in addition to SFC 235. There are no other new requirements related to loan delivery. MH Advantage loans are delivered using:  ConstructionMethodType (Sort ID 51): “Manufactured”  ManufacturedHomeWidthType (Sort ID 33): “MultiWide” or “SingleWide”  If the property is located in a condo, co-op, or PUD, the related project data points are also required. Loan-Level Price Adjustments (LLPA) The 50 basis point LLPA that is applicable to manufactured housing does not apply to MH Advantage. All other standard requirements that apply to manufactured housing apply to MH Advantage. NO T E : The Eligibility Matrix, Loan-Level Price Adjustment Matrix, and Special Feature Codes documents have all been updated to reflect these changes. For more information about MH Advantage, see our website. Effective Dates Beginning today, lenders can:  underwrite MH Advantage loans in DU Version 10.2,  submit MH Advantage loans to EarlyCheck to validate the data via a new set of MH Advantage edits,  deliver whole loans to us, and © 2018 Fannie Mae. Trademarks of Fannie Mae. SEL- 2018-05 3 of 8  deliver loans in an MBS with pool issue dates after May 1, 2018. Inspection of Manufactured Homes with Structural Modifications Currently, the Selling Guide requires that when a manufactured home has an addition or a structural modification and is not located in a state with an agency responsible for inspecting these modifications, then the property must be inspected by a licensed professional engineer. The engineer must certify that the addition or structural change was completed in accordance with the HUD Manufactured Home Construction Safety Standards. With this update, if the state does not have this requirement, then the structural modification must be inspected and the structural modifications be deemed structurally sound by a third party who is regulated by the state and is qualified to make the determination. Certification of compliance with HUD Manufactured Home Construction and Safety Standards is no longer required. Effective Date Lenders can take advantage of this change immediately. Project Standards Updates In response to lender feedback, we have made several updates to our condo, co-op, and PUD project policies. These updates will simplify our policies and increase flexibilities when originating loans secured by units in a project. The following table describes the updates. Refer to the Selling Guide for additional details and clarifications. Summary of Project Standards Updates Single-Entity Ownership  Waive the single-entity ownership requirement when the purchase transaction will result in a reduction in the single-entity ownership concentration (maximum single entity ownership 49%, no delinquent dues, no pending or active special assessments)  Exempt units held by non-profits, affordable housing programs (including units subject to non-eviction rent regulation codes), or institutions of higher education from the percentage of single entity ownership calculation  Allow single-entity ownership in projects with 21 or more units to increase to 20% Commercial Space  Exempt commercially owned or operated parking spaces from the project’s commercial space calculations  Increase commercial space to 35% Established Project Definition  Allow a new condo project to be reviewed as an “established” project if it meets all the requirements for an established project other than the 90% unit conveyance policy. Allow 80% conveyance if the developer is holding back units as rental stock if additional requirements are met. Investment Property Transactions  Allow investor transactions to be eligible for Limited Review for LTV, CLTV, and HCLTV to 75% FHA Project Review  Allow delivery of conventional loans secured by units in established condo projects approved by FHA’s HUD Review and Approval Process (HRAP) Two-to Four-Unit Condo Projects  Waive project review requirements, with the exception of some basic requirements that apply Projects Consisting of Manufactured Homes  Allow Full Review of established condo projects  Condo and PUD projects subject to community land trusts, deed restrictions, leasehold estates, or shared equity arrangements may be eligible under the Fannie Mae Project Eligibility Review Service (PERS) Legal Non-Conforming Zoning  Align project standards policy to standard appraisal policy that requires the appraiser to comment on the market response to legal non-conforming zoning © 2018 Fannie Mae. Trademarks of Fannie Mae. SEL- 2018-05 4 of 8 Projects Operating as a Hotel or Motel (“Condotel” Policy) Clarify criteria for identifying projects that operate as hotels or motels. The HOA and/or project cannot:  be licensed or managed/operated as a commercial hotel, motel, resort, or hospitality entity  restrict owners ability to occupy the unit during any part of the year  require owners to make their unit available for rental pooling (daily or otherwise)  require that the unit owners share profits from the rental of units to the HOA, management company, or resort or hotel rental company Live-Work Condo Projects  Simplify current policy with the requirement that live-work projects be primarily residential in nature and must be in compliance with local zoning or development regulations for live-work projects Limited Equity Co-ops  Allow limited-equity co-ops to be evaluated through the PERS process for project approval (both streamlined PERS and standard PERS) – limited equity feature must be related to an affordable housing preservation program and is in compliance with our requirements on resale restrictions when applicable In addition to these changes, we also took the opportunity to streamline and reorganize some of the content. For example, we removed the topic pertaining to detached condos. It was replaced with a new topic that clearly describes the requirements that apply to projects and transactions for which a project review is waived. We also removed duplicate content that appeared in multiple topics, such as Project Type Codes. These are now listed in their entirety in only one topic. Effective Dates Lenders may apply these changes when reviewing projects immediately. The weekend of June 23, 2018 the following systems will be updated to support these changes:  DU Version 10.2,  Collateral Underwriter® (CU®),  Uniform Collateral Data Portal® (UCDP®),  EarlyCheck™, and  Loan Delivery – Whole loans can be delivered beginning June 23, 2018, and loans in MBS with pool issue dates on or after July 1, 2018 Condo Project Manager (CPM) will be updated to align with these changes in August 2018. In the interim, lenders may continue to use CPM for projects that do not require the additional flexibilities described in this announcement. For projects that are newly eligible under these expanded eligibility requirements, lenders may complete the applicable project review outside of CPM. Flash Settlement for MBS Last year we eliminated Flash MBS processing fees and instead offered Flash MBS as an acceptable, standard, and no cost delivery option. This has reduced selling costs and increased flexibility for same month pooling and allowed lenders to receive book-entry delivery on Fannie Mae MBS as soon as 72 hours. In our continuing effort to increase pooling flexibility, we will now allow lenders to receive book-entry delivery on Fannie Mae’s published Majors as soon as 48 hours after we receive the Loan Delivery submission. This reduced time-line for book-entry turnaround is only applicable for Fannie Mae’s published Majors. Single issuer MBS must still be delivered 72 hours prior to book-entry. © 2018 Fannie Mae. Trademarks of Fannie Mae. SEL- 2018-05 5 of 8 Additionally, we are updating the Pool Settlement Calendars to reflect the 5 th business day before the end of the month as the last date to submit Single Family MBS, allowing for an additional day of pooling. Effective Date The change to Flash Majors will occur with MBS delivered on or after July 1, 2018. The change to the Pool Settlement Calendars will begin with the July Calendar. Desktop Underwriter Bankruptcy and Mortgage Delinquency Assessment The Selling Guide has been updated to include the policies related to bankruptcy and mortgage delinquency assessment that were described in the DU Version 10.2 June Update Release Notes. When inaccurate information exists in a credit report, lenders will have the ability to instruct DU to disregard (in the eligibility assessment) inaccurate bankruptcy or mortgage delinquency information, or disregard a bankruptcy that was due to extenuating circumstances. Effective Date These changes will apply to new loan casefiles submitted or resubmitted to DU on or after the weekend of June 23, 2018. See the DU Version 10.2 June Update Release Notes for additional information. HomeStyle Energy in DU The Selling Guide has been updated to align with updates to DU regarding HomeStyle Energy mortgage loans. Because these updates will allow DU to identify transactions having energy-related improvements, the Selling Guide policy requiring lenders to manually confirm HomeStyle Energy requirements outside of DU has been removed. Effective Date These changes will apply to new loan casefiles submitted or resubmitted to DU on or after the weekend of June 23, 2018. See the DU Version 10.2 Release Notes for additional information. NO T E : As specified in the DU Version 10.2 Release Notes, two new fields are being added to DU to identify HomeStyle Energy loan submissions: Energy Improvement Amount and PACE Loan Payoff Amount. An amount must be entered in one or both of these fields for DU to be able to underwrite the loan casefile as HomeStyle Energy. If a lender’s loan origination system cannot be updated with these two new fields by June 23, the lender can access the DU user interface to enter the data. Alternatively, we will allow lenders to continue to manually apply the HomeStyle Energy policies to DU loan casefiles until their systems have been updated. HomeStyle Renovation Forms We have posted model Renovation Loan documents and related Summary Pages that may be used in connection with HomeStyle Renovation Loans. The following special purpose model documents are now available:  Multistate Renovation Contract – Fannie Mae Model Document (Form 3730), and  Multistate Renovation Loan Agreement – Fannie Mae Model Document (Form 3731). Also, the following model riders are now available:  Multistate Renovation Loan Rider to Security Instrument – Fannie Mae Model Document (Form 3732), and  Multistate Renovation Loan Investor Rider to Security Instrument – Fannie Mae Model Document (Form 3733). © 2018 Fannie Mae. Trademarks of Fannie Mae. SEL- 2018-05 6 of 8 The Selling Guide has been updated to include references to these new forms. Effective Date These documents may be used immediately; however, because they are model documents, usage is strictly optional. Miscellaneous Selling Guide Updates Multiple Appraisals. Earlier this year, we clarified the policy in B4-1.3-12, Quality Assurance regarding second appraisals. With this update, we moved a similar policy that existed in B4-1.1-02, Lender Responsibilities, to a more appropriate location in the Guide, B4-1.2-02, Appraisal Age and Use Requirements. The multiple appraisal policy is now clearly described in the two topics where lenders are most likely to look for that information. Primary Mortgage Insurance Absence Reason Code 97. Currently, if a loan is delivered without mortgage insurance, one of two codes is required:  MI Code 95 – No MI Based on Original LTV  MI Code 97 – MI Canceled Based on Current LTV We have updated the Approved Mortgage Insurers and Related Identifiers, published on our website and referenced in the Selling Guide, to reflect that Primary MI Absence Reason Code 97 may only be used for non-flow deliveries. This code is only appropriate for non-flow deliveries because it indicates that even though the original LTV ratio was greater than 80%, no mortgage insurance is required because mortgage insurance was canceled based on a new value obtained after origination. (Note that this update did not result in a direct change to the Selling Guide text.) ***** Lenders who have questions about this Announcement should contact their Customer Delivery Team. Carlos T. Perez Senior Vice President and Chief Credit Officer for Single-Family © 2018 Fannie Mae. Trademarks of Fannie Mae. SEL- 2018-05 7 of 8 Attachment Section of the Announcement Updated Selling Guide Topics MH Advantage Properties  B2-1.2-01, Purchase Transactions  B2-1.2-02, Limited Cash-Out Refinance Transactions  B2-2-04, Guarantors, Co-Signers, or Non-Occupant Borrowers on the Subject Transaction  B2-3-02, Special Property Eligibility and Underwriting Considerations: Factory-Built Housing  B4-1.2-01, Appraisal Report Forms and Exhibits  B4-1.4-01, Factory-Built Housing: Manufactured Housing  B4-1.4-10, Property Inspection Waivers  B4-2.2-05, Requirements for Review of Detached Condos (Topic deleted)  B4-2.2-08, Additional Requirements for Review of Condo, Co-ops, and PUD Projects Comprised of Manufactured Homes (Topic deleted)  B5-2-01, Manufactured Housing  B5-2-03, Manufactured Housing Underwriting Requirements  B5-2-04, Manufactured Housing Pricing, Mortgage Insurance, and Special Feature Code Requirements  B5-5.1-02, Community Seconds Loan Eligibility  B5-6-02: HomeReady Mortgage Loan and Borrower Eligibility  B7-1-02, Mortgage Insurance Coverage Requirements Inspection of Manufactured Homes with Structural Modifications  B2-3-02, Special Property Eligibility and Underwriting Considerations: Factory-Built Housing Project Standards Updates  B2-3-01, General Property Eligibility  B2-3-02, Special Property Eligibility and Underwriting Considerations: Factory-Built Housing  B2-3-03, Special Property Eligibility and Underwriting Considerations: Leasehold Estates  B4-1.4-01, Factory-Built Housing: Manufactured Housing  B4-2.1-01, General Information on Project Standards  B4-2.1-02, Waiver of Project Review  B4-2.1-03, Ineligible Projects  B4-2.2-01, Limited Review Process  B4-2.2-02, Full Review Process © 2018 Fannie Mae. Trademarks of Fannie Mae. SEL- 2018-05 8 of 8 Section of the Announcement Updated Selling Guide Topics  B4-2.2-03, Full Review: Additional Eligibility Requirements for Units in New and Newly Converted Condo Projects  B4-2.2-04, Geographic-Specific Condo Project Considerations  B4-2.2-05, FHA-Approved Condo Review Eligibility  B4-2.2-06, Project Eligibility Review Service (PERS)  B4-2.3-01, Eligibility Requirements for Units in PUD Projects  B5-2-02, Manufactured Housing Loan Eligibility  B5-5.1-04, Community Land Trusts Flash Settlement for MBS  C3-7-06, Settling the Trade Desktop Underwriter® Bankruptcy and Mortgage Delinquency Assessment  B3-5.3-09, DU Credit Report Analysis HomeStyle Energy in DU  B4-1.4-10, Property Inspection Waivers  B5-3.3-01, HomeStyle Energy for Improvements on Existing Properties HomeStyle Renovation Forms  B5-3.2-06, HomeStyle Renovation: Renovation Contract, Renovation Loan Agreement, and Lien Waiver  B8-4-01, Riders and Addenda  B8-5-03, HomeStyle Renovation Mortgage Documentation Requirements

Source:https://www.fanniemae.com/content/announcement/sel1805.pdf 

Lender’s Certification Requirement for VA-Guaranteed Loans 1. Purpose. The purpose of this Circular is to provide clarification on the regulatory requirement that all Department of Veterans Affairs (VA) guaranteed loans require lender certifications. 2. Background. Recently, VA Regional Loan Centers and Lenders have inquired as to the validity of the Lender Certification in conjunction with Interest Rate Reduction Refinance Loans (IRRRLs). The Lender Certification is required on IRRRLs whether or not underwriting is required. This is supported in 38 CFR 36.4340(k). This section states that: “Lenders originating loans are responsible for determining and certifying to VA on the appropriate application or closing form that the loan meets all statutory and regulatory requirements. Lenders will affirmatively certify that loans were made in full compliance with the law and loan guaranty regulations as prescribed in this section.” 3. Action. Lender’s certification applies to all VA-guaranteed loans, and is not contingent upon the type of VA loan. 4. Rescission: This Circular is rescinded July 1, 2020. By Direction of the Under Secretary for Benefits Jeffrey F. London Director Loan Guaranty Service Distribution: CO: RPC 2021 SS (26A1) FLD: VBAFS, 1 each (Reproduce and distribute based on RPC 2021)

Source: https://www.benefits.va.gov/homeloans/documents/circulars/26_18_14.pdf