GNMA Revises Process for Applications to Refinance VA Loans

GNMA issued APM 21-06 to clarify APM 19-05, which revised the seasoning requirements for VA refinance loans under Chapter 24, Part 2 § (A)(3)(d)(i).  GNMA implemented the Protecting Affordable Mortgages for Veterans Act through APM 19-05 and exempted Modified Loans from the seasoning requirement.  APM 19-05 created confusion as to whether it also exempted refinances of Modified Loans from the seasoning requirements. 

APM 21-06 clarifies the seasoning requirements for both Modified Loans and refinances of Modified Loans.  Specifically, APM 21-06 states that Modified Loans are considered new loans and are not subject to the seasoning requirements under Chapter 24, Part 2 § (A)(3)(d)(i) and (ii).  However, loans that refinance a Modified Loan are subject to the aforementioned seasoning requirements.  APM 21-06 also defines the term “Refinance of a Modified Loan” and redefined “Modified Loan,” to clarify the seasoning requirements.  The changes have an effective date of January 1, 2022.