Fannie Mae Announces "No Changes for 2008 Conventional Loan
Limits"
Fannie Mae has announced that there will be no changes to their conventional
loan limits for the upcoming year. The mortgage loan limits effective
January 1, 2007 of $417,000 ($625,500 for Alaska and Hawaii) will continue to
apply to all conventional mortgages delivered to Fannie Mae. The maximum
allowable original mortgage loan limits of $208,500 and $312,700 for second
mortgages will also remain unchanged.
Lenders must remember that the sum of the original loan amounts for the first
and second mortgages can not exceed $417,000 (or $625,500 in Alaska and Hawaii).
These limits apply whether or not Fannie Mae owns or has an interest in the
first mortgage.
New Requirements for Massachusetts' Mortgage Brokers and
Mortgage Lenders
The Attorney General of Massachusetts amended MA 940 CMR 8.00, making it an
unfair or deceptive act or practice for any lender or broker to make or arrange
a mortgage loan without reasonably believing that the borrower is able to repay
the loan. Lenders and brokers are also prohibited from making or processing a
"no documentation," "limited documentation," or "stated income" loan without
first providing a written disclosure to the borrower. In addition, brokers are
prohibited from processing, making, or arranging a loan when the financial
interest of the broker "conflicts" with the interests of the borrower.
The regulation is effective November 15, 2007, but the disclosures required
by the amendment are not required until January 2, 2008. The disclosures must be
provided to the borrower no later than three business days after the earliest of
the following events: the receipt by the lender of an oral or written
application for a mortgage loan; any communication which leads the lender to
incur any expenses on behalf of the borrower;.any oral or written agreement by
the mortgage lender and the borrower; or the issuance of any commitment.
These disclosures will be available from ProClose in January, as MA4PO1 and
MA4PP1.
Upcoming Notary Requirement Changes in California
CA Assembly Bill 886 listed several changes for Notary requirements effective
January 1, 2008. Previously, a notary public executing various documents had to
determine from personal knowledge or satisfactory evidence the existence of
certain facts or identities, as specified. However, the new bill removes the
option to determine the existence of these facts or identities using personal
knowledge. The failure to obtain satisfactory evidence under certain
circumstances would subject a notary public to a civil penalty not to exceed
$10,000.
This portion of the bill will affect all ProClose documents which contain the
CA Certificate of Acknowledgment. We will update our forms accordingly to
remove the phrase "personally known to me" and add a certification that the
information is true and correct. These updates will be ready for January.
