Bulletin 2021-019 FEMA Major Disaster Declaration - Texas Severe Winter Storms (DR-4586-TX)

FEMA Major Disaster Declaration - Texas Severe Winter Storms (DR-4586-TX)

NewRez LLC "NewRez" Approved Correspondent Clients: please note that on February 19, 2021, FEMA announced a Major Disaster Declaration pertaining to the Texas Severe Winter Storms with an incident period start date of February 11, 2021. No incident end date has been declared at this time.

 

As of today, one hundred twenty-six (126) counties have been identified and designated for Individual Assistance (IA) from FEMA.

 

The currently declared counties are linked here. Please check the link for the complete list of counties.

 

Effective immediately, in accordance with agency and investor requirements, NewRez will implement the following requirements for loans secured by properties located in the 126 counties identified above.

 

Delegated Correspondent Clients

 

For loans in Texas counties granted individual assistance in the above Presidentially-Declared Major Disaster Areas (PDMDA), NewRez will purchase loans from Delegated Correspondent Clients based on the following:

 

 

Fannie Mae, Freddie Mac, VA, USDA

For Agency, USDA and VA loans, the Correspondent Client represents that the property has no damage and warrants that the subject property is in marketable condition and no repairs are required or adverse conditions are present. If correspondent believes the property may have been damaged due to the storm, an inspection prior to purchase would be required as per client guide.

FHA

NewRez will purchase FHA loans in the above counties that may have been impacted by the recent winter storms or any other disaster event without the required property damage inspection report.   The Correspondent Client is not relieved of their responsibility to meet all FHA disaster policy requirements including, but not limited, to the requirements below.   FHA requires all properties pending closing or endorsement in areas under a PDMDA designated for individual assistance must have a damage inspection report that identifies and quantifies any dwelling damage. The damage inspection report must be completed by an FHA Roster Appraiser even if the inspection shows no damage to the property, and the report must be dated after the Incident Period or 14 days from the Incident Period start date of February 11, 2021 (i.e. February 25, 2021), whichever is earlier. If the effective date of the appraisal is on or after the date required above for an inspection, a separate damage inspection report is not necessary.   FHA does not require inspections for streamline refinances without appraisals.

 

Non-Delegated Correspondent Clients

 

Conventional Conforming Transactions

 

• For transactions with an appraisal dated prior to February 11, 2021, a Disaster Inspection with photos evidencing the property is free from damage and the disaster had no effect on the value or marketability is required. OR
• Correspondent Client may provide a written certification of "no damage" and provide a photograph post-disaster. The certification must be executed by an employee of the Correspondent who will not receive direct compensation from the subject transaction.
• If the Disaster Inspection or certification reveals more than minor cosmetic damage, a new interior appraisal is required, and all damage must be repaired prior to closing and/or purchase by NewRez.

 

FHA Transactions

 

• FHA Streamline Refinances do not require Disaster Inspections.
• The following applies to all FHA loans that have not closed prior to February 11, 2021:
  • Exterior inspection report with photos by original FHA appraiser must be dated after the Incident Period end date or 14 days from the Incident Period start date of February 11, 2021, (i.e. February 25, 2021), whichever is earlier.
  • Exterior inspection reports are not required if effective date of FHA appraisal is after the incident period end date.
  • If damage exists, follow requirements outlined in 4000.1 Handbook for PDMDA designations.

 

VA Transactions

 

• VA IRRRLs do not require Disaster Inspection or Veteran’s certification.
• For transactions with an appraisal dated prior to February 11, 2021, a Disaster Inspection with photos evidencing the property is free from damage and the disaster had no effect on the value or marketability is required. OR
• Correspondent Client may provide a written certification of "no damage" and provide a photograph post-disaster. The certification must be executed by an employee of the Correspondent who will not receive direct compensation from the subject transaction. If there is damage, an inspection by an approved VA roster appraiser is required prior to purchase.
• Veteran’s Certification, signed and dated:
  • • I have inspected the property located at ____________and find its condition now to be acceptable to me. I understand that I will not be charged for any disaster‐related expenses and now wish to close the loan.
      

 

USDA Transactions

 

• For transactions with an appraisal dated prior to February 11, 2021, a Disaster Inspection with photos evidencing the property is free from damage and the disaster had no effect on the value or marketability is required. OR
• Correspondent Client may provide a written certification of "no damage" and provide a photograph post-disaster. The certification must be executed by an employee of the Correspondent who will not receive direct compensation from the subject transaction. If there is damage, an inspection by an approved VA roster appraiser is required prior to purchase.
• If the Disaster Inspection reveals more than minor cosmetic damage, a new interior appraisal is required, and all damage must be repaired prior to closing and/or purchase by NewRez.

 

These requirements are based on the ongoing status of the disaster Incident Period end date for this FEMA Major Declaration. As with all FEMA Major Disaster Declarations, the impacted areas are not definitively confirmed until FEMA formally designates such areas, which occurs following the completion of the incident and an assessment of the damage. As a result, we will continue to monitor FEMA announcements for impacted areas in order to update any additional impacted counties.

 

Please reference NewRez’s FEMA Declared Disaster Policy in Chapter 7 of the Underwriting Guide for details.