The FHA Technology Open to Approved Lenders (TOTAL) Mortgage Scorecard
What is the FHA TOTAL Scorecard?
The FHA TOTAL Scorecard is a tool for measuring any credit risks of FHA loans that get submitted to an automated underwriting system. This system is the basis of electronic underwriting, which the mortgagee uses to process requests. When the request is sent, the underwriting system will contact the FHA TOTAL Scorecard for a recommendation.
Why was this scorecard developed?
TOTAL was developed by HUD to ensure that the same scoring method applies to all applicants for FHA loan insurance,
regardless of the AUS vendor that submitted the loan. The FHA TOTAL Scorecard facilities the FHA’s risk assessment and management abilities through the study and analysis of trends and the making of appropriate policy changes. TOTAL also serves to ensure that no borrowers are denied an FHA-insured mortgage because of an AUS “refer” classification.
The scorecard gives two classifications of risk, which are “Accept/Approve” and “Refer.”
The first, “Accept/Approve,” means that the FHA can ensure the borrower’s loan without requiring additional documentation. On the other hand, “Refer” indicates that the lender needs to underwrite the loan manually.
How does the Scorecard work?
The TOTAL Scorecard is “called” over the Internet by the AUS using an XML-based interface, so that the scorecard can respond in real time.
When contacted, TOTAL will assess the mortgage credit and respond to the AUS with an “accept/approve” or “refer” recommendation, which the AUS will then relay to the lender along with feedback concerning the application.
Submitting the Loan
Each AUS platform and Loan Origination System (LOS) is different, and will determine how the data, including field names, are entered into the AUS for submission. This section gives lenders the basic information on the standards and definitions that the FHA uses.
All of the following products are eligible for risk assessments using TOTAL, but not all may necessarily be supported by the AUS, so lenders are encouraged to review the AUS vendor’s user guide for more details.
Eligible Loans
In order to receive a risk assessment from the TOTAL Scorecard, the loan must fit one of the following eligible categories:
- Loan purpose
- Purchase money mortgage
- Construction-to-permanent mortgage
- Regular refinance, credit qualifying
- Cash-out refinance (max 85% of appraised value)
- Streamline refinance, credit qualifying and non-credit qualifying (enough data must be entered and verified for a risk analysis)
- Credit-qualifying assumptions
- FHA insurance product
- 203(b) — standard FHA program for detached homes
- 203(h) — mortgage for disaster victims
- 203(k) — rehabilitation mortgage
- 234(c) — condominium unit mortgage
- 247 — Hawaiian home land mortgage
- 251 — adjustable-rate mortgage (ARM) on a single-family detached or condo unit
- Energy-efficient mortgage (EEM)
Eligible Property Types
- single-family dwellings of one to four living units (note than additional underwriting guidelines apply to three- and four-unit properties)
- manufactured homes that qualify for Title II mortgage insurance
- low-rise and high-rise condominium units (must be FHA-approved or eligible for “spot condo” processing)