Bulletin 2024-016 Home Possible Plus $2500
Newrez LLC "Newrez" Approved Correspondent Clients; Freddie Mac has announced a temporary enhancement to the Home Possible product for very low-income purchase (VLIP) borrowers. A loan level pricing adjustment of $2,500, in the form of a grant, will be applied to borrowers whose total qualifying income is < 50% of the applicable area median income limit for the subject property’s location.
The full amount of the grant must be provided directly to the borrower and applied to their down payment and/or closing costs, including escrows and mortgage insurance premiums. The $2,500 grant may be used to offset the 3% contribution due from borrower personal funds. The total credit must be listed as a Grant in section L of the Final Closing Disclosure.
Homeownership counseling must be completed prior to closing using an approved agency approved program. Client should not use the HPF Program for counseling.
Loans must be registered in one of the following products to support this LLPA:
- 2565 Home Possible Plus 30-Year Fixed Rate
- 2566 Home Possible Plus 30-Year Fixed with Affordable Second
BorrowSmart Product Transition
The BorrowSmart Home Possible VLIP program will be transitioning to the new Home Possible Plus program effective immediately. The final date for Borrow Referral to Homeownership Preservation Foundation (HPF) for counseling was February 29, 2024. Any loan in process for the BorrowSmart Home Possible VLIP that has been submitted to HPF prior to 2/29/24 may proceed to closing in this program but must be purchased by Newrez on or before June 14, 2024.
Any BorrowSmart Home Possible VLIP product that has NOT been submitted to HPF for counseling must be updated to the new Home Possible Plus program. If a loan is submitted to HPF after 2/29/24, the borrower will be referred back to the lender advising the counseling program is no longer available for this product.
Going forward, clients should no longer submit to HPF for counseling for VLIP Homebuyer Education but rather follow agency approved programs.
BorrowSmart LIP ($500) remains in effect. The client should refer the borrower to HPF for counseling on or before May 31, 2024. Newrez must purchase these loans on or before September 13, 2024.
Please Note
- This temporary program will be eligible for delivery to Freddie Mac on or after March 1, 2024 thru February 28, 2025.
- The Plus is a Newrez designation for the enhancement to the Home Possible Product.