On March 2, 2010, Fannie Mae issued Selling Guide 2010-01 that describes some of the changes impacting the Selling Guide as a result of the Loan Quality Initiative (LQI). Specifically:
- Confirmation of each borrower's identity prior to the extension of credit
- Verification that all borrowers have a valid and accurate Social Security number or IndividualTaxpayer Identification Number
- Desktop Underwriter® (DU®) "Potential Red Flag" messages
- Confirmation that all parties to the mortgage transaction meet certain qualifications
- Determination that all borrower's debts are included in the qualification for the mortgage loan
- Identification of the property unit number
- Calculating LTV ratios
- Manual underwriting of DU Refer with Caution/IV loan casefiles
Each of the above changes is described in the announcement.
