01.17.19   •   Document Updates

New Data Integrity Checks: Cooperative Loans

An essential aspect of our new support for cooperative loans (details of which can be found here, here, and here) is that we currently only support these loans to the extent accepted by FNMA. FNMA’s criteria for these loans includes the following:

  • The loan must be in a first lien position in relation to other mortgage-type liens (FNMA 2018 Selling Guide B4-2.3-03 & B4-2.3-04);
  • The loan must be used to purchase, refinance, or renovate a leasehold interest in a cooperative unit. Construction cooperative loans are generally not accepted (B4-2.3-04, B5-3.1-01, & B5-3.2-02);
  • The cooperative unit must be occupied by the borrower as either a principal residence or a second home. Investment properties are not accepted (B4-2.3-04); and

Because our documents are not structured for loans which are unacceptable to FNMA, we will be implementing new data integrity checks in our system to ensure clients are not using our documents under the wrong circumstances.

A new global warning will be added which states the following:

“ConformX only supports cooperative loans in Alaska, California, Connecticut, District of Columbia, Florida, Illinois, Indiana, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New York, Pennsylvania, Virginia, and Washington.”

This warning will trigger under the following conditions:

  • Document Package Type (FI 18215) does not equal Closing
  • Cooperative (FI 22537) = Yes
  • State Code (FI 2279) does not equal any of the following:
    • Alaska
    • California
    • Connecticut
    • District of Columbia
    • Florida
    • Illinois
    • Indiana
    • Maryland
    • Massachusetts
    • Michigan
    • Minnesota
    • New Jersey
    • New York
    • Pennsylvania
    • Virginia
    • Washington

This warning will be a global error instead if “Document Package Type” equals “Closing”.

Another global warning has been added which states the following:

“ConformX does not support cooperative loans that are for HELOCs, investment properties, junior liens, construction loans, PUDs, condominiums, investors other than FNMA, or for any loans that are not conventional (i.e., VA, FHA, RD/USDA).”

This warning will trigger under the following conditions:

  • Document Package Type (FI 18215) does not equal Closing
  • Cooperative (FI 22537) = Yes
  • Document Investor Institution ID (FI 32500) does not equal SNYM
  • Any one of the following:
    • HELOC (28859) = Yes
    • Occupancy (FI 1161) = Investment
    • Lien Position (FI 1041) does not equal First Lien
    • Loan Purpose (FI 5991) = Construction Only
    • Loan Purpose (FI 5991) = Construction to Permanent
    • PUD/Condo (FI 1182) = PUD
    • PUD/Condo (FI 1182) = Condo
    • Documents To Use (FI 27242) does not equal Fannie Mae
    • Base Type (FI 2274) does not equal Conventional

This warning will be a global error when “Document Package Type” equals “Closing”.

Clients who use custom documents for loans other than the ones we do not support may deactivate these warnings and errors by contacting Client Relations or their Account Manager.

These changes will take effect on January 24, 2019. If you have any questions or concerns about this change, please contact Client Support at 1.800.497.3584.

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