May 8, 2014
CUA 2015-01 Underwriting Requirement Changes – Effective Immediately
Effective immediately, United Guaranty is expanding underwriting requirements for the following:
- CU SwiftClose® maximum debt-to-income (DTI).
- Student loan payment calculation.
- Rate/term refinance transactions.
Our Credit Union Underwriting Guide and supporting documentation will be updated in June 2015 with our next scheduled release.
CU SwiftClose Debt-to-Income Ratio (DTI)
- The maximum DTI will be increased to 50% (previously 45%).
- The 5% DTI variance will not apply.
Student Loan Payment Calculations
When the required monthly payment for any student loan (previously applied only to deferred student loans) is not listed on the credit report, the monthly payment may be determined by:
- Requiring copies of the loan documentation; or
- Using 1% of the outstanding balance (previously 2%).
Rate/Term Refinance Transactions Now Include Seasoned Subordinate Liens
Refinance transactions paying off a first-lien mortgage and a non-purchase money subordinate lien seasoned for a minimum of 12 months will be considered a rate/term refinance (previously considered a cash-out refinance).
- The 12 months' seasoning will be measured from the Note date of the existing subordinate lien to the application date of the new loan.
- If the subordinate lien is a home equity line of credit (HELOC), total draws within the last 12 months may not exceed $2,000. A loan history is required for the last 12 months to document the total draws.
All other rate/term refinance requirements remain the same.
Please contact your United Guaranty Account Representative if you have questions concerning this announcement. For questions regarding underwriting requirements or submissions, contact our Underwriting Customer Service team at 877.MI.CHOICE (877.642.4642) or email UGC:customerservice.
Proprietary © United Guaranty Corporation 2015. All rights reserved. United Guaranty is a marketing term for United Guaranty Corporation and its subsidiaries. United Guaranty and CU SwiftClose are registered marks. Coverage is available through admitted company only.