1004 for HELOCs

[Tom4value]

You are NOT appraising the loan! You are appraising the property and you are assuming they portfolio their first mortgages. Most lenders hold both the first and the heloc and often borrowers either pay the heloc off or combine both into one loan by doing a refinance and the lender always wants the option of selling a loan in the future.

Also appraisers never know where a loan is going to , when you do a 1004 and the lender sells it to Fannie you dont know it because loans are typically not sold one by one to Fannie they are packaged into a bundled or portfolio and it can be long after you ever did a report. The only time you ever find out who actually holds that bad-boy is when it defaults and that's when you often hear from the investor ** Just use the 1004 and don't give yourself and your client a headache

So as long as the appraisal is for mortgage lending, I am ok with the 1004. Thank you, Glenn. Your rationale makes sense and makes me feel confident.

Again, something that popped into my head. My client knows none of my concern.

 

[OSU Beavers]

I have one bank that orders appraisals with an interior inspection on the OLD 2055 form for in house loans.

 

[CANative]

The FNMA forms specify the use as mortgage lending. Since it's a HELOC it will not be going to the GSEs, but unless you modify the certs you are still under the obligation to follow FNMA assignment conditions (cert #21 indicates can send to GSEs) which means UAD formatting too. The client may keep the HELOC in house or sell it off (but not to the GSEs -- see cert #21 "...other secondary market participants"). Your only concern is that the intended user and use match what is in the certs. I've used the GPAR with my own certs for HELOCs and the lender was fine as they were keeping them in portfolio. Your client may be using automated review tools to check your appraisal (thus the 1004 requirement), and/or may want to sell it to the private MBS market which has standarized on FNMA assignment conditions.

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Most of the orders I get that are for HELOC's direct me to check the assignment type "other" box and state that is for a HELOC, or words to that effect.

 

[mike32716]

Most of the orders I get that are for HELOC's direct me to check the assignment type "other" box and state that is for a HELOC, or words to that effect.

I do too. Even when a HELOC is a refinance I check "other". Checking other is a guaranteed hard stop at Fannie Mae, and a good way to keep your HELOC report from being used for something else. The only "other" that Fannie Mae accepts that I am aware of is for a Fannie Mae REO, but that is in a completely different department.