Weekly briefing, October 26, 2026

Applies to: Applies to NMLS state licensees, including mortgage loan originators and mortgage companies, renewing their licenses for the coming year; it does not govern individual loans.

What to review: Before submitting any NMLS renewal requests in the season that starts Nov. 1, first confirm that every licensee has answered the updated disclosure questions and met the new employment reporting requirements. AWACS interpretation

Applies to: Fannie Mae loans sold to Newrez, where employment verification is limited to verbal, written or vendor methods; the restated Fannie Mae income and K-1 VOE updates also apply.

What to review: First, check that employment on Fannie Mae loans sold to Newrez, including DU loans, is now verified only verbally, in writing or through a vendor; then note that Newrez still does not accept attorney opinion letters, and review the restated Fannie Mae updates: the K-1 verbal VOE rule for applications from 2026-12-02, the dropped list of verbal VOE methods, three-year continuance measured from the application date, and the wider options for proving an accepted job offer and documenting new annuity or pension income, which lenders may use. AWACS interpretation

Applies to: GSE loans sold to Newrez whose appraisals use the legacy UAD 2.6 format; as a flexibility, FHA, Jumbo, Med Pro and Smart Series loans may now use UAD 3.6.

What to review: Review first which loans going to Newrez rely on UAD 2.6 appraisals, because Newrez will not buy them from March 1, 2027 through May 19, 2027 and lists February 28, 2027 as the last day it takes 2.6 reports; also note that you may now use UAD 3.6 appraisals for FHA, Jumbo, Med Pro and Smart Series loans. AWACS interpretation

Applies to: The updated bankruptcy seasoning criteria apply to closed-end second mortgage transactions.

What to review: Review updated closed-end second mortgage guidelines permitting borrowers with a discharged Chapter 13 bankruptcy to qualify after two years instead of four, alongside clarifications on measuring four-year seasoning from discharge or dismissal dates for Chapter 7 and 11 filings and the ineligibility of borrowers with multiple bankruptcies. AWACS interpretation

Applies to: Pennymac Non-QM loans (A-, A, A+, DSCR) on Ohio 1-2 unit properties and on Michigan properties, with applications dated October 22, 2026 or later.

What to review: None of these changes is mandatory: for applications dated October 22, 2026 or later, lenders may now add prepayment penalties to Pennymac Non-QM loans (A-, A, A+, DSCR) on Ohio 1-2 unit properties, capped at 1% of the unpaid balance for up to 5 years, and on Michigan properties, capped at 1% for up to 3 years, while Ohio 3-4 unit loans keep their current rules. AWACS interpretation

Applies to: Freddie Mac loans sold to Newrez, especially manufactured homes on leasehold estates (now eligible) and investment property refinances using ACE or ACE + PDR.

What to review: Nothing in this announcement is mandatory, so first review the new flexibility: underwriting may now approve manufactured homes on leasehold estates and may use ACE or ACE + PDR on investment property refinances up to 75% LTV/TLTV for no cash-out and 60% for cash-out, while manufactured homes in shared equity programs stay ineligible. AWACS interpretation

Applies to: USDA Rural Housing guaranteed purchase and refinance transactions delivered during the temporary fiscal year funding hiatus.

What to review: Review procedures for delivering USDA loans during funding lapses to ensure standard underwriting requirements are met and final loan note guarantees are tracked for post-closing delivery. AWACS interpretation

Applies to: Best Efforts Commitments taken with Pennymac from October 21, 2026, priced with the Conventional or Government LLPA grids.

What to review: Nothing in this record is marked mandatory, so secondary teams can start by comparing the revised Conventional loan balance adjustment value, along with the revised Government FICO adjustment grid mentioned in the summary, against the values they currently use for Best Efforts Commitments taken with Pennymac on or after October 21, 2026. AWACS interpretation

Applies to: Conventional primary-residence loans and Non-QM A-series and DSCR loans locked under Best Efforts commitments on or after October 22, 2026.

What to review: Neither change is marked mandatory, so secondary can start by comparing its Best Efforts pricing for commitments taken on or after October 22, 2026, against Pennymac's revised Conventional primary-residence adjustment grid and the new 1% prepayment penalty adjustment for Michigan and Ohio on the Non-QM A-series and DSCR tabs. AWACS interpretation

Applies to: Loans delivered under program delivery guidelines utilizing the updated exhibit and loan presentment request form.

What to review: Review the updated delivery dataset reference exhibit and loan presentment request form to assess the newly added appraisal and property estate enumerations. AWACS interpretation