Good news for borrowers in the purchase market! Fannie Mae added to a lender announcement on 09/26 that it had expanded its PIW (property inspection waiver) program to include purchases! Even better, you won’t have to wait to use this new option as it was included with the DU 10.1 release dated 08/19.
When can you use the PIW:
- Must be offered on the DU findings (FNMA noted on lower LTV loans the chances are highest)
- Can be used on primary residences, second homes, and investment properties
When is the PIW not eligible:
- When the subject property has a gift of equity
- When using rental income from the subject property to qualify
Underwriters, keep in mind that DU may offer PIW’s on homes with gift of equity or rental income. From my understanding it is the responsibility of the underwriter to make sure the loan file is not ineligible due to those the above bullet points. So just a heads up to us all in the underwriting world!
This is another great announcement from Fannie Mae along with the recent announcements from Freddie Mac that less purchase transactions will need an appraisal. In this current purchase heavy market it translates to less costs for the borrower, less risk for the originating lender, and faster closing times for your borrower and seller! A true win, win, win in the market!
Get all the details on the FNMA announcement FNMA SEL 1708 and