MPF Xtra® Training:Iowa Bankers Mortgage Corporation

Originating & Underwriting

Pricing & Locking a Loan

Determine the borrower's interest rate and loan pricing. Lock the loan terms.

MPF Xtra® utilizes live pricing. The price schedules available at the eMPF website are indicative pricing. Indicative pricing tells you what the price was at a set point in time. Indicative price schedules are updated 4 times a day.

A live price quote is only available using the eMPF delivery commitment/locking process. Once the quote is obtained, you will cancel the quote; only “confirm” the quote if you want to lock the loan.

Note: MPF Xtra utilizes live pricing. The price schedules available at the eMPF website are indicative pricing. Indicative pricing tells you what the price was at a set point in time. Indicative price schedules are updated 4 times a day. A live price quote is only available using the eMPF locking process. Once the quote is obtained, you will cancel the quote; only “confirm” if you intend to actually lock the loan.

The MPF Xtra product offers both Mandatory Pricing and Best Efforts delivery options. Your master commitment determines the pricing option chosen by your institution.

Mandatory Pricing: Your Responsibilities

  1. Determine Loan Level Price Adjustments (LLPAs).

    LLPAs are assessed based on loan characteristics, such as credit score, LTV, loan purpose, occupancy, number of units, product types, etc. LLPAs will be deducted from the loan funding proceeds. There may be instances where the LLPA would result in a credit.
    • For LLPAs that apply to all Mortgage Loan types, see Fannie Mae’s Standard LLPA Matrix.
    • For LLPAs that apply only to DU Refi Plus Mortgage Loans, see Fannie Mae’s Refi Plus LLPA Matrix. The DU Refi Plus LLPAs are in lieu of, and not in addition to, the standard LLPAs.
    • LLPAs are NOT built into the MPF pricing schedules or price quote. When pricing a MPF Xtra loan, you will determine the applicable LLPAs and price up to cover both the LLPA requirement and your institution’s profit margin. If loan characteristics change during the origination process, LLPAs could also change. The actual amount of LLPAs charged will be based on the loan characteristics at the loan funding.

    Tip: How to read the MPF Price Sheet

    Tip: How Sub Product Pricing Works?

    Tip: View the MPF Xtra: LLPA Worksheet

  2. Review IBMC's Servicing Released Premium (SRP) schedule.

    • SRP represents the price to be paid to the PFI for the servicing rights.
    • The amount paid is based on the SRP schedule in effect on the day the loan was locked.
    • The SRP paid by IBMC will be in addition to the price paid by MPF.
    • IBMC reserves the right to change the SRP at any time.
    • IBMC pays the SRP once a month for all loans boarded in the previous month.
      • The SRP will be paid by the fifth business day of the month.
    • Each month, IBMC will provide a loan level detail report to support SRP payments.

    Tip: View IBMC's SRP schedule.

    Tip: Find out how SRP is calculated

  3. Access pricing on the eMPF website.

    • Mandatory indicative pricing is posted to the eMPF website at approximately 8:30 AM CST each business day and updated several times during the day.
      • If you would like to receive the MPF daily indicative pricing schedule, please send a request with your contact information (including PFI#) to mortgageproducts@fhlbdm.com.
    • Live pricing is available at the eMPF website between 8:30 AM and 3:30 PM (CST) and can be accessed using the delivery commitment process. Do not confirm the price quote unless you intend to lock the loan.
    • There are no overnight price protections.
    • The indicative pricing schedules available at the eMPF website show lock terms of 5, 15, 30, 45, 60 and 90 calendar days; however, when pricing the loan within eMPF, you will lock for the actual number of days you need in a range from 3 to 90 calendar days (this provides you with a pricing advantage because you are not locking for more days than you need).
      • Your MPF funding request must occur no less than 2 days prior to the price expiration date; keep this in mind when selecting your lock term.
      • Example: If you plan to sell the loan to MPF on March 15th, you will select March 17th as your lock expiration date. For tracking purposes, the last day to request funds (March 15th) becomes your expiration date. Your loan must be closed and disbursed prior to requesting MPF purchase/fund the loan.
    • A premium or discount (also known as the agent fee) will be paid at loan funding based on the price you selected when locking your loan.
      • If the agent fee is positive (premium), MPF pays you.
      • If the agent fee is negative (discount), you owe MPF.
    • Loans are priced in 10, 15, 20, and 30 year fixed rate terms.
      • Minimum loan term 120 months.
      • Contact the MPF Service Center at #877.463.6673 for 10-year price quotes.
    • Odd amortization terms are allowed:
      • 121 – 180 month term priced at a 15-year term
      • 181 – 240 month term priced at a 20-year term
      • 241 – 360 month term priced at a 30-year term
    • High balance loans can only be 15- or 30-year terms (odd terms allowed):
    • A high balance loan is a loan in an area of the country having a high cost of housing (Boston, New York, California, Washington, D.C., etc.).
    • The loan is priced based on the loan size:
      • Loans up to $85k
      • >$85k to $110k
      • >$110k to $125k
      • >$125k to $150k
      • >$150k to $175k
      • >$175k (including high balance loans)

    Tip: Learn more about Locks and Tolerances.

  4. Loans must be locked via the eMPF website between 8:30 AM and 3:30 PM (CST).

    • When using a mandatory master commitment, you will not lock a specific borrower or property address. You will only lock a dollar amount, loan term, interest rate and lock period between 3 – 90 calendar days.
    • Once a loan is locked, you will receive a Delivery Commitment (DC) confirmation which will contain a DC number.
      • The DC number will be needed in the funding process, so save the number for future use. We recommend printing a copy of the DC confirmation to keep in the loan file.
      • Review each confirmation for accuracy and immediately contact the MPF Service Center if inaccuracies are found or you need to cancel the lock.
    • If you are unable to deliver the intended loan, you have the flexibility to substitute one or multiple loans into the existing lock. There is also flexibility in the interest rate you deliver. The available interest rate range and pricing will show on your DC confirmation.
      • When you deliver multiple loans into one delivery commitment/lock, you will use the same delivery commitment number for each of the loans.
      • The day after the loan was locked in eMPF, the individual who locked the loan received an email from IBMC providing the IBMC loan number and MERS MIN number. The MERS Min number will be will be needed by the closer/shipper for use on the MOM mortgage or the assignment of mortgage. The IBMC loan number will be used in the delivery of the loan to IBMC. If a delivery commitment is filled using more than one loan, contact IBMC for additional IBMC loan numbers and MERS Min numbers.

      Note: View a DC Confirmation Report and Interest Rate Tolerances

    Demo: New Delivery Commitment - MPF Xtra

    Demo: New Delivery Commitment - MPF Xtraplay video

    • Lock Extensions
      • To extend your lock, you must contact the MPF Service Center at 877-463-6673.
      • You may extend the lock term for one day at a time or multiple days; however, an extension cannot exceed a total of 30 calendar days.
      • There will always be a fee charged for an extension. Extension fees will be calculated and quoted to you by the MPF Service Center; you will have 60 seconds to accept or decline the quote.
      • Extension fees will be charged to your general Demand Deposit Account (DDA) within eAdvantage (your institution's banking site with FHLB Des Moines) on the date the extension is accepted.
        • You will want to have funds in your general DDA to cover the extension fee.
    • Loan Amount Reductions
      • Loan amount reduction pair-off fees are charged on a mandatory delivery commitment when the amount delivered is below the allowable tolerance of the committed dollar amount.
      • To reduce the dollar amount of your lock, you must contact the MPF Service Center at 877-463-6673.
      • The MPF Service Center will compare the price at the time the lock was issued to the price at the time of pair-off to determine if a pair-off fee will be due and the amount of the pair-off. Depending on market movement, a pair-off will be either a debit or a credit to your account.
      • When the amount delivered falls outside of the lock tolerance, the pair-off fee will be based on the full dollar amount the delivery is actually below the original locked amount.
      • Reduction pair-off fees will be calculated and quoted to you by the MPF Service Center; you will have 60 seconds to accept or decline the quote.
      • Reduction fees will be charged to your general DDA within eAdvantage, on the date the reduction fee is accepted.
        • You will want to have sufficient funds in your general DDA to cover this fee.
      • Once a lock is reduced, the tolerance rule no longer applies and the new tolerance becomes +/- $50.

    Tip: See Loan Amount Reduction examples

    • Pair-off Fees
      Pair-offs are used to offset the cost incurred by the investor when closing out all or part of a mandatory delivery commitment when customers are unable to deliver the committed dollar amount. Whole loan prices captured at commitment and again at pair-off are used to determine if a pair-off fee will be due, and the amount of the pair-off.
      • To get a pair-off fee quote, you must contact the MPF Service Center at 877.463.6673.
      • Pair-off fees are charged on a mandatory delivery commitment when the amount delivered is below the allowable tolerances for the locked dollar amount.
      • The MPF Service Center will compare the price at the time the lock was issued to the price at the time of pair-off to determine if a pair-off fee will be due, and the amount of the pair-off. Depending on market movement, a pair-off will be either a debit or a credit to your DDA account at the FHLB Des Moines eAdvantage website.
      • When the amount delivered falls outside of the lock tolerance, the pair-off fee will be based on the full dollar amount the delivery is actually below or above the original locked amount.
      • Ensure you have sufficient funds in your general DDA to cover this fee.

      Tip: See Pair-Off Fee examples

    • Over-Delivery / Price Adjustment Fee
      Occasionally, a lender will be faced with an extenuating circumstance that may require them to deliver more than the maximum delivery amount. This may occur when a consumer lowers their down payment or when a mortgage is substituted to prevent or reduce a pair-off fee. Whole loan prices at commitment and at the time of the over-delivery are used to determine if an over-delivery fee will be due.
      • The maximum over-delivery amount is 25 percent of the original commitment amount, up to (but not to exceed) the maximum allowable conforming loan limits.
        • On a commitment of $150,000, the maximum over-delivery is an additional $37,500 (25%) of the $150,000 or $187,500. When the amount delivered exceeds the allowable tolerance (the greater of $10,000 or 2.5%), the pair-off fee will be charged on the full amount the delivery is actually above the original delivery commitment amount.
      • The amount charged to your general DDA account will be based on the last price sheet of the day on the day the loan is purchased by MPF.
        • Ensure you have sufficient funds in your general DDA to cover this fee.

    Tip: See Over-Delivery / Price Adjustment Fee examples

Best Efforts Pricing: Your Responsibilities

Best Efforts pricing is exclusive to MPF Xtra and requires you to have a Best Efforts-specific master commitment. 

  1. Determine any Loan Level Price Adjustments (LLPAs).

    LLPAs are assessed based on loan characteristics such as credit score, LTV, loan purpose, occupancy, number of units, product types, etc. LLPAs will be deducted from the loan funding proceeds. There may be instances where the LLPA would result in a credit.
    • For LLPAs that apply to all Mortgage Loan types, see Fannie Mae’s Standard LLPA Matrix.
    • LLPAs are NOT built into the MPF pricing schedules or price quote. When pricing a MPF Xtra loan, you will determine the applicable LLPAs and price up cover both the LLPA requirement and your institution’s profit margin. If loan characteristics change during the origination process, LLPAs could also change. The actual amount of LLPAs charged will be based on the loan characteristics at the loan funding.

    Tip: How to read the MPF Price Sheet

    Tip: View the MPF Xtra: LLPA Worksheet

  2. Review IBMC's Servicing Released Premium (SRP) schedule.

    • SRP represents the price to be paid to the PFI for the servicing rights.
    • The amount paid is based on the SRP schedule in effect on the day the loan was locked.
    • The SRP paid by IBMC will be in addition to the price paid by MPF.
    • IBMC reserves the right to change the SRP at any time.
    • IBMC pays the SRP once a month for all loans boarded in the previous month.
      • The SRP will be paid by the fifth business day of the month.
    • Each month, IBMC will provide a loan level detail report to support SRP payments.

    Tip: View IBMC's SRP schedule.

    Tip: Find out how SRP is calculated

  3. Access pricing on the eMPF website.

    • Best efforts pricing is posted to the eMPF website at approximately 8:30 AM CST each business day and updated several times during the day.
      • If you would like to receive the MPF daily indicative pricing schedule, please send a request with your contact information (including PFI#) to mortgageproducts@fhlbdm.com.
    • Live pricing is available at the eMPF website between 8:30 AM and 3:30 PM (CST) and can be accessed using the delivery commitment process. Do not confirm the price quote unless you intend to lock the loan.
    • There are no overnight price protections.
    • The indicative pricing available at the eMPF website shows lock terms of 5, 15, 30, 45, 60 and 90 calendar days. The MPF Xtra product allows you to lock for the actual number of days you need in a range of 3 to 90 calendar days (this provides you with a pricing advantage; the pricing is based on the actual number of days you need to lock for).
    • Your MPF best efforts funding request must occur no less than 2 days prior to the price expiration date, so keep this in mind when selecting your lock term.
      • Example: If you plan to sell the loan to MPF on March 15th, you will select March 18th as your lock expiration date. For tracking purposes, the last day to request funds (March 15th) becomes your expiration date. Your loan must be closed and disbursed prior to requesting MPF purchase/fund the loan.
    • A premium or discount (also known as the agent fee) will be paid at loan funding based on the pricing you selected when locking your loan.
      • If the agent fee is positive (premium), MPF pays you.
      • If the agent fee is negative (discount), you owe MPF.
    • 15-, 20- and 30-year amortization terms are available (odd terms are not allowed). 25-year terms and odd terms are not available for Best Efforts delivery commitments. 
    • High balance loans can only be 15- or 30-year terms (odd terms are not allowed)..
      • A high balance loan is a loan in an area of the country having a high cost of housing (Boston, New York, California, Washington, D.C., etc.)
      • The loan is priced based on the loan size:
      • Loans up to $85k
      • >$85k to $110k
      • >$110k to $125k
      • >$125k to $150k
      • >$150k to $175k
      • >$175k (including high balance loans)
  4. Loans can be locked via the eMPF website between 8:30 AM and 3:30 PM (CST).

    • When locking using a best efforts master commitment, you lock a specific borrower and property address.
      • Accuracy in providing loan terms, borrower and property information is important. Changes to this information could require you to cancel your existing lock and relock the loan. If the loan is relocked within 30 days, the relocked loan will be subject to worst case pricing.
    • Once a loan is locked, you will receive a Delivery Commitment (DC) confirmation which will contain a DC number.
      • The DC number will be needed in the funding process, so save the number for future use. We recommend printing a copy of the DC confirmation to keep in the loan file.
      • Review the confirmation for accuracy and immediately contact the MPF Service Center if any inaccuracies are found.
    • The day after the loan was locked in eMPF, the individual who locked the loan received an email from IBMC providing the IBMC loan number and MERS MIN number. The MERS Min number will be will be needed by the closer/shipper for use on the MOM mortgage or the assignment of mortgage. The IBMC loan number will be used in the delivery of the loan to IBMC. If a delivery commitment is filled using more than one loan, contact IBMC for additional IBMC loan numbers and MERS Min numbers.

    Demo: New Delivery Commitment - MPF Xtra

    Demo: New Delivery Commitment - MPF Xtraplay video

    • Best Efforts Basics
      • A Best Efforts lock cannot be converted to a mandatory lock nor can a mandatory lock be converted to best efforts lock.
      • Best Effort locks are borrower and property specific – substitutions are not allowed.
      • Only one loan may be delivered under each lock.
      • When a loan is not going to close, contact the service center to cancel the Delivery Commitment.
        • If you re-lock the same loan within 30 days of expiration or cancellation (whichever is the earlier), the loan will be subject to worse case pricing.
        • If you re-lock the same borrower with a different property address, you must have a new DU case number to avoid worst case pricing.
        • If a loan is delivered and determined to be ineligible, it will be subject to a pair-off fee based on worst-case pricing.
    • Best Efforts Lock Changes
      • At the time of funding (selling the loan to MPF), the lock terms must match the loan terms.
      • The interest rate and/or the loan term can be changed without a fee for a best efforts lock.
      • The dollar amount can be changed without a fee as long as the lock stays in the same size grid and stays within the same maximum loan amount grid (i.e., conforming vs. high balance).
      • Lock changes must be called into the MPF Service Center at 877.463.6673 Option 3.
      • The loan will be re-priced based on the new interest rate and/or term using the original price sheet.
    • Best Efforts Extensions
      • MPF Xtra extensions must be requested by contacting the MPF Service Center, 877.463.6673 Option 3.
      • There will always be an extension fee. Extension fees will be calculated and quoted to you by the MPF Service Center. You will have 60 seconds to accept or decline the quote.
      • Best Efforts Delivery Commitment may be extended prior to expiration for up to and no more than 30 calendar days.
        • You may extend the lock term either one day at a time or multiple days; however, the cumulative extensions cannot exceed a total of 30 calendar days.
        • Once this 30 calendar day extension period expires, any subsequent Delivery Commitment requested for the delivery of the identified mortgage will be subject to worst case pricing if the mortgage re-locks within 30 days.
        • After 30 days, the current price sheet will be used.
      • Extension fees will be charged to your general Demand Deposit Account (DDA) with eAdvantage (your institution's banking site with FHLB Des Moines) on the date the extension is accepted.
      • For Closed Mortgages in the funding process:
        • If the loan funding does not occur prior to the Best Efforts Delivery Commitment expiration date, the lock will automatically be extended 1 day at a time until the loan funds. The MPF Xtra guide states that a funding in process will be extended for 5 days, but actual practice is 1 day at a time.
        • If you are requesting funding on the expiration date, contact the service center and get and extension.
        • If a lock is cancelled after the loan funding request has been submitted, the lock will be subject to a pair-off fee.

    Tip: See how to calculate extension fees.