Earlier this month, Fannie Mae issued Selling Guide Announcement (SEL-2021-01), which details changes to specifics regarding seasonal and secondary income, seller/servicer-initiated post-purchase adjustment process, and a miscellaneous update.
Per this announcement, verification requirements have been simplified for confirming a borrower’s seasonal and or secondary employment. Verification the borrower has a 2-year history of employment is required for seasonal employment and is recommended for secondary employment. While borrowers with secondary employment may have different employers, they may not have a gap of employment greater than one month in the most recent 12-month period, unless such secondary employment is considered seasonal employment. Further, if a borrower has seasonal income, it is no longer necessary confirm with the borrower’s employer if the borrower is likely to be rehired the next season or to confirm that the borrower will be working in the same position as they have for the past two years. Both of these changes are effective immediately.
This announcement also addresses that if a seller or servicer finds a discrepancy between data attributes submitted to Fannie Mae at the time of delivery and their loan records, a post-purchase adjustment (PPA) may be required. The Selling Guide has been updated regarding changes to the process and requirements for submitting a PPA form.
Lastly, Fannie Mae has removed references to authorizing release of data to Fannie Mae as this applies only to legacy loans being serviced.