Recent Agency Announcements of Importance

Written By: Stacey Sprain

11/29/2012- Fannie Mae Lender Letter 2012-11 Confirmation of Conventional Loan Limits for 2013
The Federal Housing Finance Agency (FHFA) has issued the maximum loan limits that will apply for conventional loans to in 2013. All loan limits for 2013 remain unchanged from 2012.

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Standard Conforming Loan Limits Contiguous States, District of Columbia, and Puerto Rico
1 unit $417,000
2 units $533,850
3 units $645,300
4 units $801,950

High Cost Area Loan Limits Contiguous States, District of Columbia, and Puerto Rico
1 unit $625,500
2 units $800,775
3 units $967,950
4 units $1,202,925

Standard Conforming Loan Limits Alaska, Guam, Hawaii, and U.S. Virgin Islands
1 unit $625,500
2 units $800,775
3 units $967,950
4 units $1,202,925

High Cost Area Loan Limits Alaska, Guam, Hawaii, and U.S. Virgin Islands
1 unit $938,250
2 units $1,201,150
3 units $1,451,925
4 units $1,804,375

The high-cost area loan limits are established for each county (or equivalent) and are published on Fannie Mae’s website and on FHFA’s website.

11/28/2012- FHA Mortgagee Letter 2012-24 Secondary Financing Eligibility Requirements for Internal Revenue Code (IRC) Section 115 Entities

With this Mortgagee Letter, FHA announces that entities that can provide proof of their IRS Section 115 status can be treated as an instrumentality of government for FHA’s secondary financing purposes. Furthermore, HUD also considers entities with the dual distinction of 501(c) (3) and Section 115 status to be instrumentalities of government. With this new consideration as instrumentalities of government, Section 115 entities are not required to have HUD approval or placement on HUD’s Nonprofit Organization Roster to operate a secondary financing program but will be held to the same program eligibility standards applicable to all other government agencies and instrumentalities of government operating secondary financing programs.

When operating a secondary financing program that is to be utilized in combination with FHA financing, organizations claiming Section 115 status must present proof of that status in one of the following forms to the lender:

1) A letter from the organization’s auditor; or
2) A written statement from the organization’s General Counsel, as an official of the organization; or
3) A Letter Ruling issued by the Internal Revenue Service; or
4) An equivalent document evidencing Section 115 status.

The document used as evidence of Section 115 status must state that the organization’s income is excluded from federal taxation through Section 115 of the Internal Revenue Code. Documentation evidencing Section 115 status must be placed on the right side of the case binder directly after “Request for Late Endorsement” in the attached, FHA Case Binder – Documentation Order.

11/23/2012- FHA Mortgagee Letter 2012-23
Last week I released an article covering the contents of this recent Mortgagee Letter.

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11/21/2012- FHA Implementation of NMLS Data Requirements in FHA Connection
On November 21st, HUD issued an announcement that they are finally ready to begin enforcing the requirement for NMLS data entry in FHA Connection for case assignment requests. These requirements will be effective on and after January 29, 2013. Lenders will be prohibited from receiving their FHA case assignment unless the loan officer name and NMLS data fields are completed accurately. In addition, lenders registering a new third party originator (TPO) in the FHAC Sponsored Originator Registry must include the TPO’s NMLS ID number, as well as the TPO’s full corporate address and EIN number, in order for registration to be successful. However, HUD notes that the Sponsored Originator Registry will recognize if the geographic location of the TPO is currently one of five states which are exempt from registering their companies with NMLS. Individual loan officers should not be registered as TPOs unless they are set up as a sole proprietorship or have otherwise incorporated themselves as a legal entity. All lenders are strongly encouraged to review and update TPO information in the Sponsored Originator Registry for TPOs that they have already registered in FHA Connection.

These NMLS data requirements were originally announced in Mortgagee Letters 2010-33 and 2011-04.

About The Author

Stacey Sprain - As an NAMP® staff writer, Ms. Stacey Sprain is currently a NAMP® member in good standing, and is a NAMP® Certified Ambassador Loan Processor (NAMP®-CALP). With over 15+ years of mortgage banking experience, Stacey is also a Quality Control Manager for a major mortgage lending institution. If you would like to become a volunteer writer for us, please email us at:

Opinion-Editorial (Op-Ed) Disclaimer For NAMU® Library Articles: The views and opinions expressed in the NAMU® Library articles are those of the authors and do not necessarily reflect any official NAMU® policy or position. Examples of analysis performed within this article are only examples. They should not be utilized in real-world application as they are based only on very limited and dated open source information. Assumptions made within the analysis are not reflective of the position of NAMU®. Nothing contained in this articles should be considered legal advice.