Why can some brokers get a loan approved and some can not? There are probably more reasons than we would want to know, but one reason is knowing how to use DU or LP. Here is one more DU tip:
When using DU if you do not get an approval review your feedback for the reasons that you may be giving the non approval. If the reasons are DTI, reserves etc. and there is anything you can do to eliminate the risk try this first. If you still don't have an approval notice if your Feed back has any "Potential Red Flag messages".
If you read the DU Manuel it says "Du can provide a number of potential red flag messages that are designed to help our customers detect inconsistencies in loan casefiles as well as potentially fraudulent transactions. For a list of these messages as well as information on what causes DU to return each potential red flag message and Fannie Mae's recommended approach for reviewing the information when each of these messages is received, see the DU Potential Red Flag message matrix. The matrix is available through efanniemae.com as well as the DU Help Center (by searching on the words "red flags") Lenders can contact Fannie Mae for help.
Note: The appearance of these messages does not affect the underwriting recommendation from DU. Rather they are designed to help lenders detect inconsistencies and potentially fraudulent transactions. Furthermore, the absent of any of these messages doesn't not indicate or imply Fannie Mae's acceptance of the data submitted to DU including the appraised value."
Okay that is what FANNIE says, but that has not been my experience. Very often when I see a Red Flag and if it is something that I can address such as the value not being there and I reduce the value I get an approval. My suggestion if you do not get an approval and you have a Red Flag try to address that issue and rerun your loan through DU and you will usually get an approval.
DU will be having web trainings next month take some time and sign up
I want my brokers to be as knowledgeable as possible on DU/LP so you can close more loans. The training is for the new Version 7 DU.
Also Version 7 DU will be more conservative than the current version so it will be worth your while to take these trainings
Shirley Nault has been a mortgage professional for over 20 years. Visit her other mortgage web sites go to www.naultfhatips.blogspot.com or www.mtgview.blogspot.com
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