Loan Origination Process
All Participating Lenders are responsible for originating and closing loans in compliance with NIFA Program eligibility guidelines, agency insuring guidelines, secondary market guidelines and Master Servicer guidelines.
Step 1: Use the Lender Online System
All approved Participating Lenders have access to a secure web-based loan reservation system called Lender Online (LOL). All loan files are electronically submitted in LOL for NIFA program compliance review. NIFA program forms are available both individually and as PDF packages. Each lending institution will designate an administrator who is responsible for managing user access levels and passwords.
Step 2: Enter Loan Reservations
Once the buyer has an accepted purchase agreement, Loan Reservations are entered into the Lender Online (LOL). The system will automatically generate a reservation number and allows users to print a reservation confirmation page.
NIFA interest rates are valid for 120 days from the loan reservation date. The Loan Delivery Schedule has tiered pricing for the Service Release Premium (SRP). The maximum SRP is attained by the Participating Lender when the closed loan is delivered and purchased by the master servicer, U.S. Bank, within 90 days of the loan reservation date.
Step 3: Submit Loan Files for program compliance review using the eDocs feature
All loan files should be submitted for program compliance review using the eDocs feature in Lender Online (LOL). This feature is available within the Loan Status section. Any users uploading packages must complete the process in its entirety which means they should save and submit packages.
Important: The process is not complete until this message is displayed: “The eMortgageDocs Package has been received by our agency.” Not completing this step could delay the file review.
Step 4: Pre-Closing Compliance Review
NIFA strongly encourages Participating Lenders to submit loan files for program compliance review before closing. A pre-closing review is not mandatory, but it gives the Participating Lenders an opportunity to determine if the loan meets NIFA’s Program Guidelines. Our goal is to maintain a 24 to 48-hour turnaround time on our compliance reviews.
View the Pre-Closing Document Checklist to build your PDF package and then submit loan files for review. We recommend submitting files for review at least five business days prior to closing or more if there are concerns about the household income exceeding our maximum limit.
All outstanding conditions are posted in the Loan Status section. Once all conditions are cleared, Lender Online (LOL) will automatically generate a Commitment Letter that is available in the PDF section.
Step 5: Homebuyer Assistance (HBA) Second Mortgage Closing Review
Participating Lenders are not authorized to close either the first mortgage loan or second mortgage loan for the HBA Program until a second mortgage closing review is completed.
This step is very important in the origination process to keep the first mortgage loan in compliance with agency underwriting requirements. All documents on the HBA Closing Approval Checklist must be included. We prefer to receive the closing package for review and approval at least one business day prior to closing. After approval of the Homebuyer Assistance (HBA) Second Mortgage, a Legally Enforceable Obligation Letter is available. The Legally Enforceable Obligation Letter must be included in the FHA Case Binder for insuring purposes.
Step 6: Post-Closing Compliance Review
After the loan is closed, Participating Lenders should use the most current version of the Post-Closing Document Checklist to package and submit loan files for review. Post-closing packages must be submitted within 10 business days of closing. If a pre-closing review was not completed by NIFA, all documents listed on the Pre-Closing Document Checklist must be included with the post-closing package.
All outstanding conditions are posted in the Loan Status section.
Step 7: Deliver Closed Loans
All closed loan files should be delivered to NIFA's master servicer, U.S. Bank, as soon as possible. All files are delivered electronically using a system called DocVelocity. Delays in delivering closed loans will result in a lower SRP paid to the Participating Lender. Refer to U.S. Bank's website or NIFA's Lender Manual for more information.
Step 8: Master Servicer Loan Review Process
All closed loans are reviewed by U.S. Bank for compliance with agency guidelines, secondary market guidelines and regulatory guidelines. U.S. Bank does not review files for NIFA program eligibility; NIFA performs that review.
Step 9: Loan Conditions
Participating Lenders are responsible for clearing all conditions in a timely manner. U.S. Bank provides a weekly exception report that includes loans with outstanding conditions which must be cleared before the loan is eligible for purchase. A loan will not be purchased with outstanding conditions.
Step 10: Loan Purchase Process
Once all NIFA and U.S Bank conditions have been cleared and the first and if applicable, second HBA loans have been purchased, the Participating Lender will receive the SRP based on the Loan Delivery Schedule. Participating Lenders must collect loan payments from borrowers until the loan(s) are purchased.
Important note: U.S. Bank requires all final loan documents to be submitted within 90 days of the purchase date. Penalty fees may be assessed beyond 90 days.
Participating Lenders should frequently access U.S. Bank’s website to obtain current information and requirements. Participating Lenders may also send questions to U.S. Bank's help desk. The help desk will respond to a question or route the question to the appropriate department. The help desk phone number is 800-562-5165, option 2 or the help desk email address is firstname.lastname@example.org.
NIFA Homeownership Team Contact: