The FHA Documentation Guideline feedback messages will assist you in validating information transmitted to Loan Prospector. These messages appear on the Feedback Certificate in the Loan Processing Information section, Documentation Guideline subsection.
Updated: November 2011
Code
FHA Documentation Guideline Feedback Messages
1M
Gift Funds Deposited: If gift funds have been deposited into the borrower's account at time of initial submission to Loan Prospector, list donor's name, address, phone #, relationship to borrower, subject property address and dollar amount of gift, $~GiftFund~, in a gift letter signed by donor for each gift received.
1N
Gift Funds not Deposited: If gift funds have not been deposited into borrower's account at time of initial submission, document transfer of gift funds per FHA requirements.
A0
Stocks and/or Bond Accounts: Obtain most recent 2 months statement(s) for each account to verify sufficient funds required to close. No proof of liquidation required.
A9
Sale of Assets: Obtain bill of sale and proof of proceeds or document existence, value and buyer's intent, if an asset (other than real estate and exchange-traded securities) will be sold for funds required to close.
AA
Stocks and/or Bond Accounts: Obtain most recent 3 months statement(s) for each account to verify sufficient funds required to close. Proof of liquidation is required if funds are used for closing.
AB
Depository Accounts: Obtain most recent 2 months statement(s) showing previous month's balance, or 3 months statement(s) for each account to verify sufficient funds required to close.
AP
If more than 7 months have elapsed since business tax year ending date, and income to self-employed borrower, {self-employed borrower}, from each individual business, is greater than 5% of his/her stable monthly income, obtain balance sheet and YTD P&L statement.
AQ
If applicable, provide an explanation for employment gaps greater than 180 days.
AR
If applicable, provide an explanation for employment gaps greater than 30 days.
B0
Sale of Assets: Obtain bill of sale and proof of proceeds, if an asset (other than real estate or exchange-traded securities) will be sold for funds required to close.
B6
Depository Accounts: Obtain most recent statement(s) showing previous month's balance or 2 months statement(s) for each account to verify sufficient funds required to close.
BH
If using alimony/child support income to qualify, obtain most recent 3 months bank statements or canceled checks or court payment record and evidence of 3 year continuance.
CD
Sale of Home: Obtain executed HUD-1 or equivalent closing statement. If relocation, obtain executed buyout agreement (evidencing mortgage will be paid by employer/relocation company) and closing statement.
DL
Obtain most recent 2 years W-2(s) to verify current and previous employment for {employed borrower}.
DN
Obtain most recent 2 years signed individual federal income tax returns for self-employed borrower {self-employed borrower}.
DT
Obtain most recent YTD paystub documenting 1 full month earnings and a verbal VOE to verify current employment {employed borrower}.
Lender is responsible for documenting any situation not addressed on this feedback certificate according to the FHA TOTAL Mortgage Scorecard User’s Guide and/or HUD Handbook 4155.
KB
Business Credit Report is required if Borrower’s income is derived from a corporation or S-Corp.
KC
IF CAIVRS indicates federal delinquency/lien, this loan must be documented and underwritten to FHA’s REFER requirements.
KD
Loan must be documented and underwritten to FHA’s REFER requirements due to Federal Delinquency/Lien.
KF
This loan qualifies for ACCEPT FHA TOTAL Scorecard documentation.
KG
This loan qualifies for REFER FHA TOTAL Scorecard documentation.
KP
Retirement Accounts: Obtain most recent employer, depository or brokerage statement(s) for each account to verify sufficient funds required to close. Document conditions under which funds may be withdrawn or borrowed. Only 60% of the vested amount of the account may be used as funds to close or cash reserves.
MX
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}.
MW
If borrower receives commission income greater than 25% of his/her annual income, obtain most recent 2 years signed individual federal income tax returns and consider business expenses in underwriting.
U9
If the credit report reveals that the borrower is disputing any credit accounts or public records, the mortgage loan application must be referred to a DE underwriter for review, unless the disputed account has a zero balance; is marked as "paid in full" or "resolved"; or has both a balance less than $500 and the date of the dispute is more than 24 months old.
