New Pricing and FHA and Conventional Product Updates

New Pricing and FHA Update
As a good business practice, Minnesota Housing has reviewed its loan pricing and launched new pricing effective immediately. Visit our interest rate page for details. 

Please note that our downpayment and closing cost loan programs do not rely on premium pricing mechanisms to fund the loans. All Minnesota Housing downpayment and closing cost programs comply with FHA requirements for secondary financing provided by government agencies, so this issue does not affect our programs or your processes as a lender. 

For more information, please see the eNews sent on July 21, 2015 that announced Minnesota Housing programs are not affected by HUD audit report.
Fannie Mae Conventional Product Updates

We updated the HFA Preferred™ and HFA Preferred Risk Sharing™ product descriptions and the Credit and DTI Matrix to reflect these product updates: 

Ownership Interest at the Time of Closing Now Allowed
Do you have borrowers who didn’t qualify for a conventional loan with Minnesota Housing because they already had an ownership interest in another property? Effective immediately, Fannie Mae has eliminated its requirement that borrowers cannot have an ownership interest in another property at the time of closing for its HFA Preferred™ and HFA Preferred Risk Sharing™ loan products. 

Minimum 640 FICO with HFA Preferred™
U.S. Bank recently announced a reduction in its credit score overlay for HFA Preferred™ loans:

Credit Score

DTI

640

45%

660

50%

U.S. Bank allows Minnesota Housing borrowers to go up to a 50% DTI with a 660 credit score.

Minnesota Housing is working quickly to update our online loan commitment system to accommodate these changes. We anticipate lenders will be able to lock loans on or after September 6, 2016 under these guidelines. Please watch for an announcement of the effective date for this change in a future eNews. 

Landlord Counseling
For HFA Preferred™ loans, Fannie Mae still requires landlord counseling for duplex purchase transactions that have an LTV that exceeds the LTV required by the Selling Guide Eligibility Matrix. Fannie Mae eliminated this requirement from its HomeReady® underlying product guidelines, but retained the requirement for its exclusive HFA products, including HFA Preferred™.

Freddie Mac Conventional Product Updates

U.S. Bank recently announced a reduction in its credit score overlay for HFA Advantage loans:

Credit Score

DTI

640

45%

660

50%

U.S. Bank allows Minnesota Housing borrowers to go up to a 50% DTI with a 660 credit score.

Minnesota Housing is working quickly to update our online loan commitment system to accommodate these changes. We anticipate lenders will be able to lock loans on or after September 6, 2016 under these guidelines. Please watch for an announcement of the effective date for this change in a future eNews.

Updated Credit and DTI Matrix

Our Credit and DTI Matrix not only includes updated FICO and DTI requirements, but it has a new look too.  

Guidance on GSE Findings

As a reminder, please only include the final GSE findings in the loan file.

Need a Minnesota Housing Refresher?

Training is not just for loan officers! Our Webinars are just as important for underwriters, processors, closers and post-closers. Visit the training page for more details and register for these upcoming Webinars:

Office Closed on Labor Day
Minnesota Housing will be closed on Monday, September 5 for Labor Day. Lenders will be unable to lock new loans between 5:00 p.m. on Friday, September 2 and 10:00 a.m. on Tuesday, September 6.
Questions?
You can reach the Partner Solutions Team at 651.296.8215 or 800.710.8871 between 7:30 a.m. and 5:00 p.m. on business days.
400 Sibley Street, Suite 300 | Saint Paul, MN 55101 US
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