In a recent release of the Selling Guide, the Federal Mortgage Association updated a number of important policies ranging from unreimbursed employee business expenses to custodian tracking of Fannie Mae loan numbers. One very important regulation, which changed in the announcement, will make the buying process much more fluid for potential multi-family investors.
Fannie Mae expanded the use of vested stock, bonds, and mutual funds toward down payments, closing costs, and required reserves for purchases. This is a change to the previous policy which did not allow these less-liquid forms of assets to be used toward purchase requirements. Under the current statutes, “one hundred percent of the value of the asset is allowed when determining available reserves.” Furthermore, if the asset in use is over 20% in excess of the total necessary funding, no documentation of liquidation must be presented; if not meeting the excess requirement, the borrower must either present actual receipt of funds acquired in the sale or documentation of liquidation.