Conventional Product Changes
Fannie Mae Changes
Fannie Mae recently announced changes to their conventional loan products that will affect our Start Up and Step Up conventional loans. Join our webinar to learn how Minnesota Housing is implementing the changes - see details below.
In early September we will be implementing changes to our conventional loan offerings, including:
- Pricing changes effective September 5, 2019:
- Different pricing for Fannie Mae borrowers at or below 80% Area Median Income (AMI) and Fannie Mae borrowers over 80% AMI.
- Changes to mortgage insurance rates for Fannie Mae borrowers above 80% AMI.
- Fannie Mae borrowers with initial DU® run dates on or after September 5 will no longer be eligible for charter-rate mortgage insurance.
- Product/options availability
- Fannie Mae HFA Preferred Risk Sharing™ loans will no longer be available to borrowers over 80% AMI (for borrowers with initial DU® run dates on or after September 5).
- Upfront Paid Mortgage Insurance (UPMI) will no longer be available to Fannie Mae borrowers above 80% AMI (effective for new locks in the Minnesota Housing loan commitment system on or after September 5).
How do the Fannie Mae 80% income limits work?
- Qualifying income is used to determine if the borrower is above or below 80% AMI.
- The limits are based on the county in which the property is located.
- Learn more about what Special Feature Codes to use and how DU® findings will change in the Critical Lender Update webinar.
- In the Minnesota Housing loan commitment system, the qualifying income will determine the available Fannie Mae rates and product options.
Freddie Mac has not made any changes to their HFA Advantage® Product. Things to remember when offering Freddie Mac loans:
- Minnesota Housing will be pricing Freddie Mac loans (regardless of borrower AMI) with the Fannie Mae loans at or below 80% AMI.
- Charter-rate MI and Upfront Paid Mortgage Insurance (UPMI) will still be available on Freddie Mac loans regardless of borrower income.
- The Conventional Cash to Close grant continues to be available for borrowers with incomes under 80% AMI. See the Conventional Cash to Close Guide for more details.
Join us for a Critical Lender Update to learn more and ask questions. Both webinar sessions will cover the same information. Click below to register:
We will update the Lender Toolkit on September 5. Click the Conventional Loan Options section to access conventional resources.