The FHA Documentation Checklist for Loan Prospector feedback messages focus on the Documentation Checklist to guide the underwriting analysis. These messages appear on the Documentation Checklist section.
Updated: November 2011
Code
FHA Documentation Checklist
KQ
Retirement Statements: Most recent for each employer, depository or brokerage account to verify funds to close and withdrawal penalties. Document withdrawal conditions. Only 60% of the vested amount of the account may be used as funds to close or cash reserves.
SB
W-2's: Most recent for 2 years for {employed borrower}.
SF
Employment Gaps: Explain if > 180 days.
SJ
Paystub: Most recent YTD paystub documenting 1 full month earnings and verbal VOE for {employed borrower}.
SK
Balance Sheet and YTD P&L Statement: If > 7 months have elapsed since business tax year ending date, and income to ~SlfEmpBorr~, from each individual business is > 5% of his/her stable monthly income.
SL
Employment Gaps: Explain if > 30 days.
SX
Depository Statements: Most recent showing previous month's balance or 2 months statements for each account to verify funds to close.
SY
Stock/Bond Statements: Most recent 2 months for each account to verify funds to close.
SZ
Bill of Sale and Proof of Proceeds: Or document existence, value and buyer's intent, if non-real estate or non-security asset will be sold for funds to close.
T1
Depository Statements: Most recent 2 months showing previous month's balance or 3 months statements for each account to verify funds to close.
T2
Stock/Bond Statements: Most recent 3 months for each account to verify funds to close.
T8
Source of Funds to Close: Verify down payment and closing costs.
TJ
This loan is subject to one or more fees. Please refer to the Delivery Fees Information section of the Full Feedback Certificate for details.
VA
Lender is responsible for documenting any situation not addressed on this feedback certificate according to FHA TOTAL Mortgage Scorecard User’s Guide and/or HUD Handbook 4155.
VB
Business Credit Report is required if Borrower’s income is derived from a corporation or S-Corp.
VC
If CAIVRS indicates federal delinquency/lien, this loan must be documented and underwritten to FHA’s REFER requirements.
VD
Loan must be documented and underwritten to FHA’s REFER requirements due to Federal Delinquency/Lien.
VE
If credit report shows a contingent mortgage debt, obtain transfer of title and assumption or divorce agreement. Do not count in borrower’s ratios if you obtain evidence that the mortgage has been current during the previous 12 months, or that the loan-to-value ratio is at or below 75%.
VN
If borrower receives commission income greater than 25% of his/her annual income, obtain most recent 2 years signed individual federal tax returns and consider business expenses in underwriting.
VP
If income to borrower from an individual business is greater than 5% of borrower's stable monthly income, obtain most recent 2 years signed federal business tax returns for each business for self-employed borrower, {self-employed borrower}.
VQ
If credit report shows a contingent mortgage debt, obtain transfer of title and assumption or divorce agreement and do not count debt in borrower's ratios.
VU
Gift funds Deposited: List donor's name, address, relationship to borrower, subject property address and dollar amount of gift on application or in a gift letter signed by donor for each gift that has been deposited to the borrower's account prior to submission to LP.
VV
Gift Funds Not Deposited: Document transfer of gift funds for each gift received that has not been deposited prior to the initial submission to LP per FHA requirements.
W3
Alimony/Child Support Income: Most recent 3 months bank statements or canceled checks or court payment record and evidence of 3 years continuance if using income to qualify.
WQ
Retirement Statements: Obtain most recent 2 months statement. 70% of the vested amount minus any outstanding loans may be used as funds for closing and reserves submitted to LP. If the assets in the account are needed for closing, proof of liquidation must be provided in the mortgage file.
WR
Executed HUD-1: Or equivalent closing statement if sale of home. If relocation, executed buyout agreement and closing statement.
WS
Bill of Sale and Proof of Proceeds: If non-real estate or non-security asset will be sold for funds to close.
WW
Reserves: Verify all submitted to Loan Prospector.
