VA Circular 26-19-22 on IRRRLs: Fee Recoupment, NTB Calculations, and Loan Seasoning Requirements
In an effort to stem some of the rampant churning of VA loans, VA released Circular 26-19-22 (including three exhibits) to offer guidance on the statutory restrictions for IRRRLs (as enacted by Section 309 of the Economic Growth, Regulatory Relief and Consumer Proptection Act of 2018 and fixes the enacted part of the Protecting Affordable Mortgages for Veterans Act of 2019.) VA emphasizes this guidance relates to IRRRLs only.
Interesting? VA “suggests” Lenders cure IRRRLs with application dates on or after May 25, 2018 and before August 8, 2019, where the loans did not meet the recoupment and/or net tangible benefit standards as outlined in the Circular. Before cure, VA must approve and verify the veteran doesn’t pay for the cure.
The VA issues updated guidance on the requirement to document Veteran’s exemption status before closing.
Understanding the cyclical nature of mortgage lending has become an exacting science. As my colleague Seth Sprague evangelizes – it’s a balance of origination and servicing. Do you see a recession on the horizon?
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