Re-verification Procedures

The re-verification process will evaluate the validity and the quality of the data provided in the original underwriting decision, as well as protect against fraud and/or misrepresentation.

1. Verifications of Employment and Income

Original documentation of employment and income may be comprised of several factors including:

  • Verification of Employment and Income Forms (VOE)
  • Check or paystubs
  • Salary vouchers
  • W-2 Forms
  • Copies of tax returns
  • Financial statements
  • Compensation award letters

PPP will re-verify all original methods of income and employment verification. Copies of the original verifications will be sent to the issuers with a request that the original data be confirmed for accuracy. In lieu of written confirmation, oral re-verification may be used (only if properly documented in writing and retained in mortgage file).

If oral confirmation is obtained, the information transcribed to the file will include:

  • the identity of the staff employee who conducted confirmation interview
  • the identity of the borrower’s employer
  • the identity (name and title) of the individual providing the confirmation
  • the date and time of the contact or confirmation
  • a statement of confirmation that information in the original verification was accurate

2. Re-verification of Sources of Funds

Original documentation used to verify sources of funds for down payments, closing costs, and prepaid items may be in the form of the following:

  • Verification of Deposit Forms (VOD)
  • Depository account statements
  • stock or security account statements
  • a signed settlement statement or other evidence of conveyance and transfer of funds if a sale of

PPP will re-verify each of these sources, as applicable. Copies of the original verifications will be sent to the issuers with a request that the original data be confirmed for accuracy. Oral confirmation may be utilized and proper documentation will be maintained.

3. Credit Reports

PPP must obtain either a new Residential Mortgage Credit Report (RMCR) or a three-repository merged in-file credit report for one out of 10 [or 10% of the selected sample] of the manually underwritten mortgage loans selected in the mortgage. Typically, loans approved by the Automated Underwriting System do not require credit re-verification.

Regardless of which type of credit report obtained, the new report will be ordered from a source other than that used in the original transaction. Data from the new report will be compared with that on the original credit report. Any discrepancies will be cited and included in the final assessment of the mortgage.

4. Review Appraisals

A “review” or “field review” appraisal will be completed for review by PPP. The review appraisal will :

  • be either a new appraisal, or a field inspection
  • be prepared by a qualified appraiser, not affiliated with original firm
  • establish value and marketability of the subject property as of the time of the original appraisal and NOT as of the date of the PPP analysis.
  • provide an evaluation of the quality of the original appraisal

NOTE: A field inspection will include a minimum of:

  • an exterior review of the subject property and all comparable sales used in the original appraisal
  • a review of the accuracy of the factual data in the original appraisal report

PPP will perform a “desk review” of the original appraisal. For consistency purposes, a Desk Review form will be provided by the client

5. Payment History

All mortgage payment histories, rental payment histories, and other large liabilities not evidenced on the credit report will be re-verified by PPP

6. Mortgage Application

If deemed necessary, a copy of the original, signed mortgage application will be mailed to the borrowers with a request that they:

  • acknowledge their signatures
  • verify original information
  • state if they were asked to sign a blank of incomplete mortgage application
  • state is they were asked to omit any information requested on the original application

7. Management Reports on Re-verification

Periodic, regular reports to management will include information concerning re-verification requests that are not being returned in a reasonable amount of time. Follow-up procedures will be developed with each client.