Approval Levels

Loan Purchase Eligibility

  • Seller must underwrite and close all loans delivered to PennyMac for purchase.
  • Seller may use an approved underwriting service provider to underwrite loans delivered to PennyMac for purchase.
  • Loans must meet PennyMac guidelines.
  • AUS decision required in accordance with the following:
    • Conventional: DU or LPA approval.
    • FHA: DU or LPA TOTAL Scorecard approval. Streamline transactions do not require a TOTAL Scorecard approval.
    • VA: DU approval, LPA approval, or manual underwrite per Product Profile. IRRRL transactions do not require an AUS approval.
    • Rural: GUS approval, or manual underwrite per Product Profile.

Loans underwritten by a nationally recognized MI contract underwriting company that meet the above criteria are eligible for purchase.

Sellers must be aware of the following when utilizing MI contract underwriting or any other underwriting service provider:

  • The Seller must establish and utilize their own contract underwriting agreement with the vendor.
  • Reps and Warrants to PennyMac for underwriting decisions remain with the Seller.
  • The Seller must perform normal due diligence in processing and underwriting the loan prior to submitting the loan to the contract underwriter.
  • Sellers are responsible for all origination activities, including compliance with federal and state reporting requirements including, but not limited to, HMDA reporting.
  • A contract underwriting decision issued by a Mortgage Insurance Company or any other vendor on behalf of the Seller will not impact or change the Seller’s responsibility and obligation to sell PennyMac loans that are in full compliance with the Manual and the Loan Purchase Agreement.