December 22, 2021

Bulletin 2021-120 FEMA Declared Disaster – Alabama (DR-4632-AL)

FEMA Declared Disaster – Alabama (DR-4632-AL)

Newrez LLC "Newrez" Approved Correspondent Clients: please note, on December 21, 2021, FEMA issued a Major Disaster Declaration, under the Robert T. Stafford Disaster Relief and Emergency Assistance Act (the Stafford Act), for the Alabama Severe Storms and Flooding natural disaster events with an incident start date of October 6, 2021 and incident end date of October 7, 2021.  

 

Under the FEMA Major Disaster Declaration, the following two (2) counties have been       designated for Individual Assistance due to the impact of the disaster:

 

  • Jefferson 
  • Shelby 

 

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

 

If the effective date of the appraisal or appraisal alternative was on or prior to the October 7, 2021, Incident End date, the following inspection options by product type will be required. 

Conventional

 

  • For properties located within the counties listed above with an appraisal dated on or prior to October 7, 2021, and has not closed by the date of this announcement, either one of the following is required: 
    • A Borrower signed attestation that subject property was not damaged by disaster along with supporting photos that are date/time stamped. If the photos indicate more than minor cosmetic damage, a new interior appraisal is required, and all damage must be repaired prior to closing. This Borrower attestation option is not eligible for Cash-out refinances. 
    • A Correspondent client certification that represents and warrants that the property has not sustained damage and that the subject property is in marketable condition with no required repairs or adverse conditions. This Client certification option is not eligible for Cash-out refinances. 
    • A Disaster Inspection Report with photos evidencing the property is free from damage and the disaster had no effect on the value or marketability is 
      required.
    • If the Disaster Inspection Report or Attestation reveals more than minor cosmetic damage, a new interior appraisal is required, and all damage must be repaired prior to closing and purchase by Newrez. 

Non-Conforming

 

  • If the effective date of the appraisal or appraisal alternative was on or prior to the October 7, 2021 incident end date, an inspection is required prior to closing or funding of the loan in accordance the Newrez Client Guide Chapter 15, Disaster Policy.

 

VA

 

  • VA IRRRLs do not require Disaster Inspection or Veteran’s certification. 
  • For properties located within the counties listed above with an appraisal dated on or prior to October 7, 2021, and have not closed by the date of this announcement, one of following options is required: 
    • Veteran to provide date/time stamped Photo’s to evidence that subject property was not damaged as result of the disaster along with a “Veteran’s Certification”, signed and dated with following language: 
      • “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.” 
    • A Correspondent client certification that represents and warrants that the property has not sustained damage and that the subject property is in marketable condition with no required repairs or adverse conditions with a “Veteran’s Certification”, signed and dated with following language: 
      • “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.” 
    • A Disaster Inspection with photos evidencing the property is free from damage and the disaster had no effect on the value or marketability and a “Veteran’s Certification”, signed and dated with following language: 
      • “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.” 

 

FHA Loans 

  • FHA Streamline Refinances do not require Disaster Inspections. 
  • The following inspection requirements apply to all properties located within the FEMA designated counties listed above. 
  • The following applies to all FHA loans that have not closed by December 22, 2021: 
    • If FHA appraisal is dated on or prior to October 7, 2021, an interior/exterior inspection report with photos by original appraiser or FHA roster appraiser must be dated after the Incident Period end date of October 7, 2021.  
    • If the inspections indicated damage from the disaster, follow repair and escrow requirements outlined in the 4000.1 Handbook based on the amount of repairs and whether property is habitable. 

 

The following applies to all FHA loans that have closed, but not endorsed by December 22, 2021: 

  • If the loan has closed prior to December 22, 2021, and is not FHA insured, an exterior-only inspection by a FHA roster appraiser will be required prior to endorsement 
  • If the inspections indicate damage from the disaster, follow repair requirements outlined in the 4000.1 Handbook based on the amount of repairs and whether property is habitable.  

USDA Loans

 

  • USDA Streamlined-assist and Streamline without Appraisal Refinance do not require Disaster Inspections.
  • For properties located within the counties listed above with an appraisal dated prior to October 7, 2021, and has not closed by the date of this announcement, the following is required:
    • A Disaster Inspection Report with photos evidencing the property is free from damage and the disaster had no effect on the value or marketability is required.