All policy changes and updates are referenced below to the appropriate section of the CLG. These policy changes are effective 11/03/2021 unless otherwise noted.
To review the program guidelines changes made October 19, 2021, or earlier, please follow this link to the archived Correspondent Lending Guides.
These updates apply to everyone using the Chenoa Fund program—correspondents and TPO.
Section 5.30 (Private Mortgage Insurance [MI] Coverage) has been given a new sub-section, 5.30.1 (Transferring Private Mortgage Insurance). The section will contain the following text:
Servicing Transfer address:
2100 SE 17th Street
Ocala, FL 34471
Methods to Notify Radian of a Loan Sale or Transfer of Servicing:
Language regarding CBCMA’s Admin Fee has been updated in sections 5.31 (Fees to CBCMA) and 7.10 (Important Notice Regarding CBC Mortgage Agency Investor Delivery Fee and Clarification of Rate Sheets). This language makes it more clear that CBCMA’s Admin Fee is a secondary market cost and not part of the primary transaction; therefore, the charge must be assessed in section A of the LE/CD.
Section 5.34.13 (Additional Properties Owned) had the following sentence added to the All DPA Edge Products section: “As a reminder, FHA guidelines regarding owner occupancy requirements must be met.”
Section 5.34.15 (Appraisal Overlays) has been updated to clarify that the collateral review for appraisals must come from FNMA:
All Conventional Programs: CBCMA will require the following for all first mortgage appraisals based on the FNMA CU score[…]
Section 8.11.2 (Loans Cancelled After Closing) had its language updated for clarity:
CBC Mortgage agency has a legal obligation to reimburse down payment funds after closing, due to the Funding Obligation Letter provided at the time of loan registration—this has the potential to create a large expense for CBCMA and the Correspondent on loans with defects that cannot be cured. To avoid this, one of two following cancellation options must be followed:
Option 1: Fulfillment of the Funding Obligation
This option is recommended if the loan must be cancelled but the Correspondent has insured or wants to insure the loan with FHA or if the Correspondent intends to deliver the loan to Fannie Mae™. By choosing this option, the Correspondent is requesting that CBCMA fulfills its obligation to reimburse the funds that the Correspondent advanced at the closing table on behalf of CBCMA. Once CBCMA reimburses the down payment, the Correspondent will become contractually obligated by the loan purchase and sales agreement to pay a loan non-delivery fee. CBCMA will then wire the down payment funds described in the Funding Obligation Letter to the Correspondent and the Correspondent will then be under contractual obligation to pay a loan non-delivery fee of the reimbursement amount plus 1%.
Option 2: Release of the Funding Obligation
Correspondents desiring to negate the contractual obligation to pay a loan non-delivery fee may sign a legal document releasing CBCMA from the obligation to reimburse the borrower’s down payment funds. Once the form is signed, the transaction will be cancelled and the Correspondent will retain full ownership of the first mortgage and receive ownership of the secondary financing. Pursuing this option will result in the loan not meeting FHA insuring requirements or Fannie Mae™ Community Seconds® guidelines.
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