Several types of programs are not supported by Fannie Mae for Texas Home Equity Section 50(a)(6) loans. There are also some payment features not allowed by law for these types of loans.
All Texas Home Equity Section 50(a)(6) notes and riders posted by Fannie Mae are available in ConformX. A second lien fixed rate note and plain language second lien fixed rate note are also available in ConformX for TX Home Equity loans.
Three new data integrity errors are being added for TX Home Equity loans in Pre-Closing and Closing document packages to ensure clients do not attempt to close TX Home Equity loans that are not supported in ConformX or not permitted by law.
- The following Error message will display if an ARM loan has a fixed term other than 5 years, 7 years, or 10 years; or an ARM Index other than 1 year WSJ LIBOR, 1 year Treasury, or 10 year Treasury:
ConformX does not support Texas Home Equity Section 50 (a)(6) loan documents for this type of ARM loan. In general, only ARM Notes/Riders as posted by FNMA are supported for TX Home Equity loans.
- The following Error message will display for Biweekly loans:
ConformX does not support Biweekly Texas Home Equity Section 50 (a)(6) loan documents. In general, only Notes/Riders as posted by FNMA are supported for TX Home Equity loans.
- The following Error message will display for Balloon or Interest Only loans:
Texas Home Equity Section 50 (a)(6) loans must have fully amortizing, substantially equal payments. Balloon and Interest Only payments are not allowed under Tex. Admin. Code tit. 7, § 153.11 for TX Home Equity loans.
These changes will be in effect on February 21, 2017. If you have any questions or concerns, please contact Client Support at 1.800.497.3584.
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