Selling Guide

Published May 30, 2017

Part B: Origination Through Closing

This part provides the requirements for originating conventional and government loans for sale to Fannie Mae.

Update in 90 Seconds >>

Watch Jude describe the May Selling Guide Update.

See Also: Previous Policy Videos

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What's New

  • Lender Letter LL 2017-02: Credit Report Changes

    Effective July 2017, the credit reporting agencies will no longer include most tax liens and civil judgments in credit reports. Read Lender Letter LL-2017-02 for more information.

  • Selling Guide Updates

    The following updates were made in May: electronically notarized documents are accepted by Fannie Mae; whole loan ARM commitments now use the gross mortgage margin; over-delivery limits of whole loan commitments cannot exceed 25%; more flexibility for whole loan cash back pair-offs; and copies of mortgage documents are allowable documentation.

Related Resources

B1: Loan Application Package

This subpart describes the documentation required in application packages for loans to be delivered to Fannie Mae. It describes the allowable age of credit documents and provides a sample of a borrower’s signature authorization form.

B2: Eligibility

This subpart describes Fannie Mae’s mortgage, borrower, and property eligibility policies and occupancy type requirements.

B3: Underwriting Borrowers

This subpart contains borrower underwriting policies for conventional mortgage loans that are sold to Fannie Mae. These policies include an evaluation of the borrower’s (or spouse’s to the extent required by applicable law in Wisconsin) equity investment, credit history, liquid reserves, reliable and recurring income, and the cumulative effect that these and other risk factors have on mortgage loan performance. Fannie Mae’s underwriting policies enable the lender to consider various scenarios in evaluating a borrower’s willingness and capacity to repay the mortgage loan. The lender must confirm that information provided by the borrower during the loan application process is accurate and complete; include documentation in the loan file that supports the lender’s assessment of the borrower’s credit history, employment and income, assets, and other financial information used for qualifying; conduct a comprehensive risk assessment of each mortgage loan application; and render a decision to either approve or decline the mortgage loan application. Fannie Mae offers lenders two options for conducting a comprehensive risk assessment–automated underwriting through DU or manual underwriting. Both methods include an evaluation of the borrower’s equity investment, credit history, liquid reserves, reliable and recurring income, and the cumulative effect that these and other risk factors have on mortgage loan performance.

B4: Underwriting Property

This subpart contains property underwriting and appraisal requirements for conventional loans.

B5: Unique Eligibility and Underwriting Considerations

This subpart contains unique eligibility and underwriting considerations pertaining to certain loan, property, and financing types.

B6: Government Programs Eligibility and Underwriting Requirements

This subpart contains information on government mortgage loans eligible for sale to Fannie Mae.

B7: Insurance

This subpart describes Fannie Mae’s requirements for mortgage, title, property, flood, liability, and fidelity insurance.

B8: Closing: Legal Documents

This subpart describes legal document requirements in connection with mortgage loans sold to Fannie Mae.