GNMA Revises Process for Applications to Refinance VA Loans

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GNMA issued APM 21-06 to clarify APM 19-05, which revised the seasoning requirements for VA refinance loans under Chapter 24, Part 2 § (A)(3)(d)(i). GNMA implemented the Protecting Affordable Mortgages for Veterans Act through APM 19-05 and exempted Modified Loans from the seasoning requirement.  APM 19-05 created confusion as to whether it also exempted refinances of Modified Loans from the seasoning requirements. 

APM 21-06 clarifies the seasoning requirements for both Modified Loans and refinances of Modified Loans.  Specifically, APM 21-06 states that Modified Loans are considered new loans and are not subject to the seasoning requirements under Chapter 24, Part 2 § (A)(3)(d)(i) and (ii).  However, loans that refinance a Modified Loan are subject to the aforementioned seasoning requirements.  APM 21-06 also defines the term “Refinance of a Modified Loan” and redefined “Modified Loan,” to clarify the seasoning requirements.  The changes have an effective date of January 1, 2022.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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