Ops Memo - Re-verification of Employment

Due to current market conditions, changes to our Employment re-verification process are necessary to manage risk.  The changes below are effective immediately and apply to all Agency and Government Loans that have not closed.

Wage Earners:

• A Verbal Verification will remain a requirement before docs and at time of funding.
• In those instances where a traditional VVOE is unable to be completed, an email from the employer as an alternative will suffice, with the following restriction.
  • Be from the borrower’s direct Supervisor/Manager or the employer’s HR Department; and
  • contain all the standard information required on a verbal verification of employment, include the name, title and phone number of the person providing the verification.
• As an additional step, the following questions are being added to our Verbal Verification of Employment form.
  • Is the company still open and in operation?
  • Is the borrower still employed?
  • Is the borrower on a leave of absence or furloughed?
  • Has the borrowers income been affected?
• We will also be requiring a paystub (immediately preceding the closing date) or Written Verification of Employment dated within 10 calendar days of closing.
  • Underwriter will add this as a PTD condition.
• If hours worked are reduced, the reduced hours will be utilized for qualifying purposes.
• If a borrower is on temporary leave, we can follow the temporary leave guidelines per program.

Self-Employed: 

• A Borrower prepared YTD P&L is required confirming income is in line with the income being utilized for qualifying purposes.
  • YTD P&L must be signed and dated within 10 days of closing.
  • Underwriter will add this as a PTD condition.

Rental Income:

• If rental income is being utilized for qualification purposes and the most recent tax returns were used to calculate income the following is required.
  • Copy of current fully executed lease
  • Underwriter will add this as a PTD condition.

Note: When utilizing 2019 tax returns for qualifying purposes, we will require one of the following:

• 2019 1040 Tax Transcripts
• Evidence of E-filing, signed 1040s, proof of refund received or amount owed to IRS clearing borrowers account.

Should you have any additional questions, please contact your manager.