Below is guidance for Loan Delivery and Purchase Guideline changes in light of all the recent business closures or issues surrounding COVID-19. As you are aware, this is a fluid situation and guidance may change quickly in the future.
Conventional and Government Loans:
Verbal Verification of Employment Requirements
- All Verbal VOEs (VVOE) must always be done in compliance with end agency (FNMA, FHLMC, FHA, VA or USDA) guidance.
- For all loans using a third party provider for the VVOE, such as The Work Number, the person who obtains the VVOE must also perform a Google search on the business or perform some other check to ensure the business is still open.
- A VVOE must be completed on all files on the day of disbursement.
- The employer must verify the borrower is in an active status (not suspended or on furlough without pay) and is still obtaining income. Borrowers who are suspended or furloughed and not getting paid while on suspension/furlough must qualify without the income.
- VVOE must be completed, if the lender is unable to obtain it because the business is closed the loan will be ineligible for purchase until it can be completed.
- All employment will be re-verified by AHFA prior to loan purchase.
Pay Stubs
- Current agency requirement states that a pay stub be dated no earlier than 30 days prior to the initial loan application date.
- Additionally, lenders must obtain the most current pay stub that reflects year-to-date earnings.
- Pay stubs must reflect no disruption of income.
IRS Transcripts
- Requirements remain unchanged.
- Extension of 2019 tax filing deadline to July 15, 2020 will be factored into most recent year determination.
Electronic/remote notaries, also known as Remote Online Notaries (RON)
- AHFA is unable to accept electronic/remote notaries at this time.
Interim Servicing
- Any loan in which the lender has granted forbearance or loan modification is ineligible for sale to AHFA.
- All loans must be current and pay history will continue to be required prior to purchase.
Representations and Warranties
- When delivering loans originated pursuant to the provisions of this announcement, the lender warrants that the borrower is employed at the time the loan is delivered to AHFA.
- All lender representations, warranties and covenants as defined in the Mortgage Origination and Sale Agreement remain in effect.
- Lender repurchase requirements of mortgages defined as Non-Qualified Mortgages and Early Payment Default Mortgages remains in effect.
