Company News

The Federal Housing Finance Agency (FHFA) recently directed Fannie Mae and Freddie Mac to increase loan guarantee fees (g-fee) that are charged. As a result, Carrington Mortgage Services will implement a change to our pricing structure for all Conforming Conventional (including High Balance products) loans.
Timing for implementation:

• Effective immediately, new 45 and 60 day locks will have the new increased fee built into the base pricing.
• On Sunday, September 16th , the 30 day base pricing will reflect the new fee increase.
• On Monday, October 1st, the 15 day base pricing will reflect the new fee increase.
• Any Conventional Conforming loans (Fannie Mae or Freddie Mac product) that are locked on or before September 16 that need to extend beyond Tuesday, October 16th to fund, will be subject to an additional 50 basis point price adjustment over and above normal extension costs. This applies to all relocks and all other extension scenarios.
• All other extension costs for loans locked on or after Monday, October 1st will be subject to the current extension fees as listed on the daily rate sheet.

Carrington Mortgage Services will monitor the pipeline and reserves the right to assess the correct extension fees where applicable.
Please direct any questions to your Account Executive.

Addition of Seasoned Mortgage Industry Executive to Drive Growth of Lending Business

Carrington Mortgage Services (Carrington) today announced the addition of Lynn Halstead as vice president of wholesale operations to its Mortgage Lending Division senior management team. Lynn joins Carrington to drive its wholesale lending channel.

"Lynn is exactly the kind of experienced, well-rounded executive we wanted to help grow our wholesale lending operation," noted Ray Brousseau, executive vice president, Carrington Mortgage Services. "Her experience covers virtually every aspect of the business -- loan production, client services, lending operations, risk management and secondary marketing -- and she excels in talent development, performance management and operational effectiveness."

Lynn brings more than 25 years of mortgage banking and real estate lending experience to Carrington. She started her career at the Household International family of companies where she managed originations and operations in the U.S. and abroad. She also managed both regional and national retail branch networks, loan servicing platforms and the wholesale correspondent lending channel. At AMRESCO Residential Mortgage as senior vice president and chief lending officer, Lynn had responsibility for wholesale and retail branch production and underwriting operations. She was also a senior vice president of national lending at Option One Mortgage, where she grew annual production to $7 billion through strategic alliances with banks and other large institutional clients.

"I am excited to join Carrington Mortgage Services, and am looking forward to working with the team to build a best-in-class origination platform," Lynn commented. "The combination of the company's entrepreneurial culture with highly engaged leaders and talented associates, made the decision to join Carrington very attractive."

Monday September 3, 2012 is Labor Day and is a Federal Holiday. Carrington Mortgage Services and the Lock Desk will be closed.

Carrington Mortgage Services will be closing early on Friday August 31, 2012 and the Lock Desk will be closing at 1:00 PST and will be closed on Monday September 3, 2012.

The Federal Housing Administration has eliminated their own new rule aimed at consumers with even fairly minor “collections debt.”
The new rule, which would have gone into effect July 1, required potential borrowers to settle any disputed debts totaling $1,000 or more before the FHA would consider backing their mortgage.
The rule originated as part of ML 2012-03 back in April. It was effective for just one week until it was placed on hold by the FHA until July 1 as they fielded questions and concerns. (Any loans written between April 1 - April 8 to fit the guidelines will not be deemed in violation of HUD requirements.)
Though the FHA drafted the rule in an effort to reduce risk and protect its emergency fund, they faced immediate pushback with the announcement.  Controversy surrounded the topic, as homebuilders and lenders loudly voiced concern that the new rule would dramatically hurt business, especially with first-time homebuyers.
News that the FHA has rescinded its tougher credit policy rule is a new bright spot for both lenders and for those looking to the FHA for home financing. Borrowers eager to see themselves in a new home no longer need to worry about resolving or paying off disputed credit before applying for a loan, as the rule has been revoked effective immediately.
But as reported on HousingWire.com, an FHA spokesperson said they are still taking comments on the original proposal.
All other guidance in ML 2012-3, which became effective April 1, 2012, remains in effect.
See the official language in the HUD Mortgagee Letter 2012-10.

Now Through 6/10/2012
As announced in FHA ML 12-04—Effective for case numbers assigned on/after 6/11/12 for streamline refinance transactions of FHA loans endorsed on/before 5/31/09:

1. Decrease to Up Front MIP: Up Front MIP = 0.01 of the base loan amount.
2. Decrease to Annual MIP: Annual MIP = 55 bps, regardless of loan amount.

Submit Early and Carrington Mortgage Services Will:

1. Confirm that the loan is eligible via the Query Screen on FHA Connections. MSI will advise you if the loan is not eligible.
2. Underwrite the loan and hold it in queue to submit for an FHA case number on 6/11/12.
3. Receive the case number from FHA, and expedite the closing/funding of the loan.

We will make every effort to facilitate a June closing for these early submissions; however, we are subject to the limitations of the FHA Connections’ ability to provide FHA Case Numbers.

• If the receipt of the FHA case numbers is delayed, CMS will strive for a July closing; however, CMS will then require an updated Payoff Letter from the Servicer.

Ready to Submit Now?

1. Submit the eligible FHA Streamline loan package to CMS according to current guidelines.
2. You do not have to include the FHA Case Number Assignment.
3. You MUST include the fully completed CMS FHA Case Number Assignment Request Form. Click Here for the form

Please include:

• Evidence of current Case Number (for the loan being refinanced).
• Copy of Pay-off letter from the servicer showing payment due for June 2012

Borrowers now need to resolve even minor disputes with their creditors before expecting the Federal Housing Administration to insure their loan. As of April 1, the FHA will no longer consider insuring a mortgage to any potential borrower with ongoing credit disputes totaling more than $1,000.
Prior to the new rule, individual underwriters and lenders could determine whether a borrower's outstanding debts and credit disputes should affect the approval of an FHA-backed mortgage. But as the FHA continues to look for ways to reduce its risk and protect the slipping levels in its reserve fund, mortgage seekers need to keep up with the stricter requirements. Starting in April, lenders need to justify each approval to the FHA and provide documentation that backs their decision.
Borrowers with debts of at least $1,000 in collections now have two options: pay off the outstanding balance or resolve the issue with a valid explanation before closing. The FHA will want to see either proof of a payment arrangement with the creditor(s) or evidence that the disputed loans are being collected as an error.
The new rule does not apply to disputed accounts that date back more than two years or to those related to fraud or identity theft, providing the client can show documentation, such as police reports, of the identity theft case or fraudulent charges. While a lender can still decide to issue the loan to a borrower who supplies sufficient information that sides in their favor, the FHA may still reject it, making this an unlikely scenario as lenders will match their caution to the new FHA rules.
Also beginning in April, the FHA has raised its insurance premiums from 1% to 1.75% of the base loan amount. Some fear the combination of these two new changes could keep the housing market in its lull, if fewer buyers can qualify for FHA mortgages. About 15% of all mortgages are insured by the FHA, which insures mortgages that originate with private FHA-approved lenders. The percentage was significantly higher in 2009 and 2010, as the loans have been a popular option for clients with less-than-perfect credit who seek a low down payment and affordable terms.

Carrington Mortgage Services is now lending in Wisconsin, Minnesota, and North Carolina. Effective immediately, all loan programs are available for all eligible subject properties located in these states. See our loan programs for details. Brokers located in these states interested in becoming an approved Carrington partner should contact their Account Executive or new broker applicants can call 866.453.2400. Carrington has partnered with Comergence Compliance Monitoring to process new broker applications for review. You can register (or log-in if you are already registered) with the Comergence system and begin your broker application now. Carrington Mortgage Services will continue expanding our Wholesale network into new markets through 2012. If you have questions please contact your Account Executive.

View our current FHA Streamline guidelines offering non credit qualifying and credit qualifying programs.  Contact your Account Executive for more information or view the loan program details,  click here
NON CREDIT QUALIFYING* PRODUCT HIGHLIGHTS

• Total lender fees: $399
• No appraisal required
• No income documentation required
• Mortgage history - no late payments in the last 12 months
• Reduced documentation compared to standard FHA loans
• Must have a current FHA loan to be eligible
• Credit qualifying loan programs available, view the loan program details, click here.

*FHA Streamline refinance non credit qualifying program requires a tri-merge credit report reflecting only the FICO score and a 12-month mortgage history. Closing costs may not be financed into a non credit qualifying refinance. Verbal verification of income source is required.
If you have any questions please contact your Account Executive
 

Monday, February 20^th is President’s Day. CMS Lending and the Lock Desk will be closed.

• All lock extensions will need to be requested by Friday, February 17^th, including those expiring on Monday, February 20^th.
• Monday, February 20, 2012 cannot be included in the rescission period for refinances.
• Monday, February 20, 2012 cannot be included in the seven (7) business day waiting period between the date the initial TIL was provided to consummation.
• When re-disclosure of the TIL is required, February 20th cannot be included in the three business day waiting period between the date the revised TIL was provided to the borrower and the consummation of the loan.

If you have any questions please contact your Account Executive.