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Overview and Main Criteria for Delivering Borrower Information
The purpose of this job aid is to help provide additional information on data fields required in Loan Delivery for delivering borrower/co-borrower and other related fields.
For detailed instructions on how to perform other tasks, see the Loan Delivery User Guide, eLearning tutorials, or other job aids. If you do not have access to Loan Delivery and require it, please contact your Technology Manager administrator.
General Borrower Identity Criteria:
A borrower is any applicant (e.g., individually or jointly) whose credit is used for qualifying purposes to determine the ability to meet Fannie Mae’s underwriting and eligibility standards. For Fannie Mae’s purposes, the term “co-borrower” is used to describe any borrower other than the first borrower (e.g., the “Primary” borrower) whose name appears on the mortgage note, regardless if that person owns the property jointly with the first borrower (and is jointly and severally liable for the note).
Lenders must confirm each borrower’s identity prior to the extension of credit. Fannie Mae’s requirements for borrower identity verification are intended to align with lenders’ existing federal obligations under laws requiring information and document verification, including the Department of Treasury's Office of Foreign Assets Control (OFAC) regulations and the U.S. Patriot Act.
How to Deliver More than Two Borrowers:
Loan Delivery accepts delivery of up to four borrowers on a loan. The process for delivering this information includes:
Import: When importing a loan containing more than two borrowers, Loan Delivery will send the data provided in the “Primary Borrower” and the “Secondary Borrower” fields to downstream Acquisitions systems. The data provided in the remaining co-borrower field(s) will be retained in the Loan Delivery database.
Manual Entry: The information provided on the Loan Delivery user interface for the “Primary Borrower” and the “Secondary Borrower” fields will be sent downstream to Acquisitions systems. For loans with more than two borrowers, users are able to enter borrower data for up to two co-borrowers on the Loan Delivery user interface.
How to Deliver Credit Scores:
Fannie Mae recommends obtaining at least two credit scores for each borrower on a loan. Select a single applicable score for underwriting each borrower.
When two credit scores are obtained, choose the lower of the two scores.
When three credit scores are obtained, choose the middle score (if two of the three scores are the same, choose the middle of the three scores. For example: 700, 680, 680 = 680; 700, 700, 680 = 700).
Under the ULDD Phase 2 requirements, the Loan Representative Credit Score field collects the representative credit score assigned to the loan. If there are multiple borrowers, the lender should determine the applicable credit score for each individual borrower (lesser of two, or middle of three) and select the lowest applicable score from all borrowers as the representative credit score for the mortgage (disregarding any borrower without a credit score).
If there is only one borrower, then deliver the credit score as determined above in the Primary Borrower’s Credit Score field. If there are multiple borrowers, deliver the applicable credit score for each individual borrower as determined above in the appropriate Credit Score field. Below are some additional considerations to keep in mind:
- When delivering a loan containing more than two borrowers, the data provided in the Primary Borrower field will always be sent downstream to Acquisitions systems.
- If the Primary Borrower contains the lowest credit score among all the borrowers, then the Primary Borrower and Secondary Borrower data will be sent downstream, as entered by the user.
NOTE: If the borrower with the lowest credit score is not the Primary or Secondary Borrower, Loan Delivery will systematically adjust the borrower positions in order to submit the borrower data with the lowest credit score in the Secondary Borrower position (as opposed to the Primary). This helps ensure that loans with more than two borrowers are eligible and priced according to Fannie Mae’s guidelines.
Loan Delivery Fields: Credit Information for Borrowers with Traditional Credit
Credit Score (Sort ID 590) must be delivered for each primary borrower and co-borrower (if applicable) when a credit score exists.
Credit Repository Source Indicator (Sort ID 582) must be delivered for each primary borrower and co-borrower (if applicable) for all loans. Credit Repository Source Indicator is “Yes” when Credit Repository Source is available. When delivering “Yes,” Credit Score Source is required. (Note: For Legal Entities, Credit Repository Source Indicator is “No”).
Credit Score Source (Sort ID 583) must be delivered when Credit Repository Source Indicator = "Yes" for the primary borrower and co-borrower (if applicable). Valid values for Credit Score Source.
01 - Equifax
02 - Trans Union
03 - Experian
Credit Report ID (Sort ID 580) must be delivered for each primary borrower and co-borrower (if applicable) when a credit score exists.
When one Borrower has Traditional Credit and other Borrowers have Non-Traditional Credit
When one borrower has traditional credit with one or more credit scores and other borrowers do not have credit scores and are relying on non-traditional credit to qualify, apply the following:
Loan Representative Credit Score for the loan: A value indicating the representative credit score assigned to the loan. If any borrower has non-traditional credit, do not enter zero in the field, but provide the representative credit score for the borrower with traditional credit.
Eligibility: The representative credit score for the borrower with traditional credit is, for eligibility purposes, the representative credit score for the transaction (e.g., determining if the requested transaction – occupancy, loan purpose, number of units, LTV, reserves – meets the eligibility requirements).
Loan Delivery Fields - Credit Information for a Borrower with Non-Traditional Credit
|Sort ID||Loan Delivery Screen Field Name||Borrower with Traditional Credit||Borrower with Non-Traditional Credit|
|251||Loan Representative Credit Score||Provide the representative credit score for the borrower with traditional credit.|
|580||Credit Report ID||Deliver the value||Leave blank|
|582||Credit Repository Source Indicator||Deliver "Yes"||Deliver "No"|
|583||Credit Score Source||Deliver appropriate value:
01 - Equifax
02 - Trans Union
03 - Experian
|590||Credit Score||Deliver the Credit Score determined per the guidelines||No FICO was obtained, leave blank|
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