CALHFA   PROGRAM TRAINING Offered through  Affinity Lending Group Affinity Lending Group Desktop Underwriter is a register...
Agenda <ul><li>Introduction </li></ul><ul><li>Eligibility Guidelines </li></ul><ul><li>CalHFA Programs </li></ul><ul><ul><...
<ul><li>Affinity Lending Group History </li></ul><ul><li>Who is CalHFA? </li></ul><ul><li>State Restriction </li></ul><ul>...
History of Affinity Lending Group <ul><li>Affinity Lending Group is an independent residential Mortgage Banking firm. </li...
CalHFA Introduction <ul><li>Who are they? </li></ul><ul><ul><li>CalHFA stands for  California Housing Finance Agency  whic...
<ul><li>Borrower Eligibility Requirements </li></ul><ul><li>First Time Home Buyer </li></ul><ul><li>Other Eligibility Requ...
Borrower Requirements 06/06/09 Topic Description First Time Home Buyer Borrower must a 1 st  Time Home Buyer. (Requirement...
First Time Home Buyer 06/06/09 Topic Description First Time Home Buyer <ul><ul><li>Defined as a person who has not had an ...
Other Eligibility Information 06/06/09 Topic Description Occupancy <ul><li>Borrower  must occupy the property for the term...
Targeted Area 06/06/09 Topic Description Targeted Area? <ul><li>33 of 58 Counties in CA have targeted areas with LA having...
CalHFA Defined High Cost & Non High Cost Regions 06/06/09 Topic Description High Cost Coastal Regions / Counties <ul><li>B...
Income Limits & Calculations 06/06/09 CalHFA  Income Limits <ul><li>Borrower’s annual family income cannot exceed the maxi...
Sales Price Limits 06/06/09 CalHFA maintains Sales Price limits that compare favorably to the Median Sales Price for each ...
CA Median Sales Price Comparison 06/06/09 CA Median Home Price Comparison  Comparison Chart  (November 2007 – May 2008) (N...
Property Eligibility 06/06/09 <ul><li>FHA:  </li></ul><ul><li>Order Case # </li></ul><ul><li>Assign your appraiser </li></...
<ul><li>30 Year Fixed - Conventional & Government </li></ul><ul><li>40 Year Fixed - Conventional  </li></ul><ul><li>35 Yea...
CalHFA Programs Types <ul><li>Available 1 st  Mortgage Products: </li></ul><ul><ul><ul><li>CalHFA Conventional Fixed Rate ...
Conventional 30 Yr Fixed  06/06/09 Topic Description Interest Rate <ul><li>Interest Rate is Fixed & Fully Amortized for th...
Conventional 40 Yr Fixed  06/06/09 Topic Description Interest Rate Interest Rate is Fixed & Fully Amortized for the entire...
Conventional Interest Only Plus 06/06/09 Topic Description Interest Rate Interest Rate is Fixed for the entire term of the...
Government Insured 30 Yr Fixed  06/06/09 Topic Description Interest Rate <ul><li>Interest Rate is Fixed & Fully Amortized ...
Subordinate Financing Options 06/06/09 * Different Income Limits Affinity Lending Group ECTP AHPP SFF * HICAP ( Convention...
No Down Payment?  No Problem! 06/06/09 <ul><li>Recently awarded funds   </li></ul><ul><ul><li>Awarded by CalHFA to various...
AHPP 06/06/09 Affordable Housing Partnership Program (CalHFA partnerships with non-profit agencies & municipalities) AHPP ...
CHAP 06/06/09 CalHFA Housing Assistance Program (Available with a Conventional or FHA 1 st  Mortgage) Target Market Low to...
CHDAP 06/06/09 California Homebuyer’s Downpayment Assistance Program ( Available with CalHFA or Non CalHFA 1 st  Mortgage ...
HICAP 06/06/09 High Cost Area Home Purchase Program (Available in CalHFA High Cost Counties –  CONVENTIONAL ONLY ) Target ...
ECTP “Buying your 1 st  Home on a Teacher’s Salary can be tough – Now it just got easier!” 06/06/09 Extra Credit Teachers ...
SFF 06/06/09 School Facility Fee Down Payment Assistance Program  (Available for Single Family New Construction Homes) Tar...
Sample Combinations 06/06/09 <ul><li>Borrower with no money down and needs all the help they can get: </li></ul><ul><ul><l...
<ul><li>NEW:  REO Program – CSHLP </li></ul><ul><ul><li>COMING SOON TO ALG… </li></ul></ul><ul><li>Builder Block Program (...
Coming soon…  NEW REO Program  (Community Stabilization Home Loan Program) 06/06/09 Topic Description Interest Rate Intere...
NEW – REO Program Cont’d… 06/06/09 Topic Description Eligible Properties  <ul><li>Property must be a selected REO from a p...
BLOCK Program (Builder Lock) 06/06/09 Builder Lock Program Block Program is available for new construction only allowing B...
HomeOpeners 06/06/09 Home Protection Insurance CalHFA offers a Mortgage Protection Program called “Homeopeners” to CalHFA ...
<ul><li>Underwriting Methods </li></ul><ul><li>General Underwriting Guidelines </li></ul><ul><li>Mortgage Insurance </li><...
Underwriting Methods 06/06/09 Acceptable Underwriting Methods MANUAL UNDERWRITING AUTOMATED UNDERWRITING Conventional Loan...
General UW Guidelines 06/06/09 CREDIT Manual UW Automated UW Minimum Credit Score Conventional:  620  Regardless of AUS fi...
General UW Guides Cont’d 06/06/09 RATIOS & INCOME Manual UW Automated UW Max DTI 45% 55% (regardless of AUS findings) Temp...
General UW Guides Cont’d 06/06/09 FUNDS TO CLOSE Manual UW Automated UW Minimum Down Payment No minimum down payment  exce...
General Guidelines 06/06/09 OTHER  Manual UW Automated UW Impounds Impounds are mandatory  on all CalHFA loans  regardless...
MORTGAGE INSURANCE 06/06/09 MORTGAGE INSURANCE Manual UW Automated UW Monthly Mortgage Insurance Zero Upfront Monthly Mort...
PMI Cancellation <ul><li>How do I request cancellation of Private Mortgage Insurance (PMI)? </li></ul><ul><li>In order to ...
Recapture Tax Cont’d… 06/06/09 Topic Guideline(s) Federal Recapture <ul><li>Recapture Only Applicable when all of the foll...
<ul><li>Interest Rate </li></ul><ul><li>Allowable Fees </li></ul>Interest Rate & Allowable Fees 06/06/09 Affinity Lending ...
Interest Rates & Fees 06/06/09 Topic Description CalHFA Interest Rates <ul><ul><li>You can obtain interest rates daily fro...
<ul><li>Highlights of the Program </li></ul><ul><li>Affinity Lending Group Closing </li></ul>Support - Highlights 06/06/09...
Highlights of the Program <ul><li>Up to100% Combined Financing available with NO down payment required </li></ul><ul><li>2...
<ul><li>On behalf of Affinity Lending Group, we thank you for joining our training today and hope the information provided...
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  • Alg Calhfa Ppt

    1. 1. CALHFA PROGRAM TRAINING Offered through Affinity Lending Group Affinity Lending Group Desktop Underwriter is a registered trademark of Fannie Mae. Loan Prospector is a registered trademark of Freddie Mac. This presentation is a summary and is not complete. Contact your ALG AE for complete program guidelines. This information is for mortgage professionals only and should not be distributed to or used by consumers or other third-parties. Information is accurate as of the date shown below and is subject to change without notice. 07/24 /2008
    2. 2. Agenda <ul><li>Introduction </li></ul><ul><li>Eligibility Guidelines </li></ul><ul><li>CalHFA Programs </li></ul><ul><ul><li>1 st Mortgage Programs </li></ul></ul><ul><ul><li>Subordinate Financing, Down Payment Assistance Programs </li></ul></ul><ul><li>Other Special Programs </li></ul><ul><ul><li>***NEW – REO Program (CSHLP) coming out soon…*** </li></ul></ul><ul><ul><li>Block Program </li></ul></ul><ul><ul><li>HomeOpeners Program </li></ul></ul><ul><li>Underwriting Standards & General Guidelines </li></ul><ul><li>Interest Rates & Fees </li></ul><ul><li>ALG Support – Marketing, Training, Website </li></ul>06/06/09
    3. 3. <ul><li>Affinity Lending Group History </li></ul><ul><li>Who is CalHFA? </li></ul><ul><li>State Restriction </li></ul><ul><li>Economic Data </li></ul>Introduction 06/06/09 Affinity Lending Group has been around since 2003. Since then, ALG has been opening doors to the American Dream. It’s all we do and we do it well. Discover today why Affinity Lending Group is your First Time Home Buyer and Down Payment Assistance Headquarters! Affinity Lending Group
    4. 4. History of Affinity Lending Group <ul><li>Affinity Lending Group is an independent residential Mortgage Banking firm. </li></ul><ul><li>Founded in 2003, Affinity Lending Group is a direct-lending mortgage banker approved as a lender by the Federal Housing Administration (FHA); the Veterans Administration (VA); the Federal National Mortgage Association (Fannie Mae); the Federal Home Loan Mortgage Corporation (Freddie Mac); the Government National Mortgage Association (Ginnie Mae); the California Housing Finance Agency (CalHFA); the California Public Employees’ Retirement System (CalPERS); the California Teachers’ Retirement System (CalSTRS); National Homebuyers Fund (NHF); Nevada Housing Division (NHD); and many other major secondary market institutions. </li></ul><ul><li>Having funded in excess of $1 billion in residential real estate loans, ALG has assisted more than two thousand families with their mortgage needs.  ALG enables families to enjoy the American Dream of Homeownership…“it’s the only thing we do.” </li></ul><ul><li>Affinity Lending Group has a longstanding tradition of providing unparalleled customer service and a reputation built on adding value to the home loan process.  That’s why ALG should be considered…“ YOUR FIRST LENDING RESOURCE ”. </li></ul>06/06/09
    5. 5. CalHFA Introduction <ul><li>Who are they? </li></ul><ul><ul><li>CalHFA stands for California Housing Finance Agency which was created by the State Legislature in 1975 to provide affordable financing to low-to-moderate income FIRST TIME HOMEBUYERS . </li></ul></ul><ul><ul><li>Created as the state’s affordable housing bank, CalHFA has invested over $14 billion in non-taxpayer funds to help more than 135,000 California families live in a home of their own with a mortgage they can afford. </li></ul></ul><ul><li>How is this program funded/financed? </li></ul><ul><ul><li>The capital used to fund this program is raised through the sale of tax-exempt mortgage revenue bonds. </li></ul></ul><ul><ul><li>Bonds are repaid by revenues generated through mortgage loans, not taxpayer dollars – completely self supported state agency. </li></ul></ul><ul><li>State Restriction </li></ul><ul><ul><li>California properties only </li></ul></ul>06/06/09
    6. 6. <ul><li>Borrower Eligibility Requirements </li></ul><ul><li>First Time Home Buyer </li></ul><ul><li>Other Eligibility Requirements </li></ul><ul><li>Targeted Areas </li></ul><ul><li>Income Limits </li></ul><ul><li>Sales Price Limits </li></ul><ul><li>Property Eligibility </li></ul>Eligibility Guidelines 06/06/09 Affinity Lending Group
    7. 7. Borrower Requirements 06/06/09 Topic Description First Time Home Buyer Borrower must a 1 st Time Home Buyer. (Requirement is waived if property is located in a Federally Designated Targeted Area) Income Limit Have an Annual Household/Family Income that does not exceed Income Limits for the family size and county in which the home is located. Down Payment Have enough money to cover the down payment (usually 3% - 5%) plus closing costs. To help with this restriction, CalHFA offers Down Payment Assistance programs. Occupancy Property must be owner occupied for term of the loan or until sold. Underwriting Meet Credit, Income and loan requirements of the CalHFA lender and Mortgage Insurer. Eligible Borrowers Be a U.S. Citizen, a National, or a qualified Alien as defined by the federal Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA).
    8. 8. First Time Home Buyer 06/06/09 Topic Description First Time Home Buyer <ul><ul><li>Defined as a person who has not had an ownership interest in their primary residence (a home in which they lived) during the 3-year period prior to the execution of the loan. Exception: </li></ul></ul><ul><ul><li>Properties in Targeted areas </li></ul></ul>Required Documents to prove FTHB <ul><li>Borrower’s Affidavit </li></ul><ul><li>Signed copies of Federal Tax Returns for the previous 3 years </li></ul><ul><ul><li>A Tax Return Affidavit is required for borrowers that were not legally obligated to file and </li></ul></ul><ul><li>Signed 4506 </li></ul>TIP <ul><ul><li>Tax Returns are NOT REQUIRED if property is in a Targeted area. </li></ul></ul><ul><ul><li>Tax Returns are REQUIRED if borrower is self-employed regardless of property location </li></ul></ul><ul><ul><li>Tax Returns are used mainly to confirm a borrower’s FTHB status. </li></ul></ul><ul><ul><li>Review Credit Report for past mortgage activity. </li></ul></ul><ul><ul><li>Review Federal Tax Returns (1040’s) for reported mortgage interest. Review Schedule A under Interest you paid line item #10. </li></ul></ul>
    9. 9. Other Eligibility Information 06/06/09 Topic Description Occupancy <ul><li>Borrower must occupy the property for the term of the CalHFA financing . </li></ul><ul><li>Exceptions are allowed on a case by case basis. Eg., Military Transfer; must be prior approved by CalHA in advance. </li></ul><ul><li>No penalty for Refinancing the CalHFA loan </li></ul><ul><li>Must payoff any down payment assistance or closing cost loans they received </li></ul>What happens if Borrower violates occupancy rules? <ul><li>Penalties may be imposed </li></ul><ul><li>Borrower has 60 days to move back into the property </li></ul><ul><li>Loan may be due and payable within 60 days </li></ul><ul><li>Interest rate could be increased to the maximum allowed by law </li></ul>Loan Purpose Purchase transactions ONLY Other Properties Borrower can own any other properties. Minimum Homebuyer Contribution Conventional: NONE REQUIRED FHA: None required except for the 3% equity that can be paid with DAP – Chap, Chdap, HICAP, ECTP, etc. Homebuyer Education NONE REQUIRED
    10. 10. Targeted Area 06/06/09 Topic Description Targeted Area? <ul><li>33 of 58 Counties in CA have targeted areas with LA having almost ½. </li></ul><ul><li>Areas that are considered targeted areas by the Federal Government were identified in the 2000 Census as communities in CA where: </li></ul><ul><ul><li>70% or more of the families earn 80% or less than the statewide median income </li></ul></ul><ul><ul><li>Neighborhoods experiencing chronic economic distress per IRS code of 1986. </li></ul></ul>Benefits of Buying in a Targeted Area? <ul><ul><li>First Time Homebuyer requirement is waived </li></ul></ul><ul><ul><ul><li>FTHB still applies to Down Payment Assistance Programs </li></ul></ul></ul><ul><ul><li>Higher Income Limits – Extends opportunities to more borrowers </li></ul></ul><ul><ul><li>Higher Sales Price Limits </li></ul></ul><ul><ul><li>Tax Returns are not required except for Self-Employed borrowers </li></ul></ul>CalHFA Targeted Areas Census Tract Locator
    11. 11. CalHFA Defined High Cost & Non High Cost Regions 06/06/09 Topic Description High Cost Coastal Regions / Counties <ul><li>Bay Area : </li></ul><ul><ul><li>Alameda, Contra Costa, Marin, Napa, San Francisco, San Mateo, Solano, Sonoma </li></ul></ul><ul><li>Central Coast: </li></ul><ul><ul><li>Monterey, San Benito, San Luis Obispo, Santa Barbara, Santa Clara, Santa Cruz, Ventura </li></ul></ul><ul><li>Southern Coast: </li></ul><ul><ul><li>Los Angeles (except Palmdale/Lancaster Area), Orange, San Diego </li></ul></ul>Non-High Cost Counties <ul><li>Northern California Rural: </li></ul><ul><ul><li>Alpine, Amador, Butte, Calaveras, Colusa, Del Norte, El Dorado, Glenn, Humboldt, Inyo, Lake, Lassen, Mariposa, Mendocino, Modoc, Mono, Nevada, Plumas, Shasta, Sierra, Siskiyou, Sutter, Tehama, Trinity, Tuolumne, Yuba </li></ul></ul><ul><li>Central Valley: </li></ul><ul><ul><li>Fresno, Kern, Kings, Los Angeles (Palmdale/Lancaster areas only), Madera, Merced, Placer, Sacramento, San Joaquin, Stanislaus, Tulare, Yolo </li></ul></ul><ul><li>Inland Empire: </li></ul><ul><ul><li>Imperial, Riverside, San Bernardino </li></ul></ul>Incentive to increase origination in H/C Area <ul><li>Lower Interest Rates </li></ul><ul><li>Additional DAP - HICAP </li></ul>
    12. 12. Income Limits & Calculations 06/06/09 CalHFA Income Limits <ul><li>Borrower’s annual family income cannot exceed the maximum income limits established by CalHFA programs or the Federal Government. </li></ul><ul><li>Maximum Income limits are based on median family income data published by HUD </li></ul><ul><li>Income Limits may be lower than the maximum allowed under Federal Tax law </li></ul><ul><li>Moderate or Low Income will determine program interest rate </li></ul>Income Calculations Eligibility Income (CalHFA) Qualifying Income (Lender) <ul><li>Household count – includes all people residing in the home (1-2 or 3 or more) </li></ul><ul><li>Household Eligibility Income is based on ALL INCOME from only those person(s) who is expected to live in the property , be vested on title and be liable for the mortgage. </li></ul><ul><li>Qualifying Income is based on the annualized gross income of any person(s) who is expected to live in the property , be vested on title and be liable for the mortgage . </li></ul><ul><li>Qual Income must meet Fannie/FHA/VA guidelines. </li></ul>Difference between the two income calculations is the types of income used in each calculation. For eg., OT, Bonus, Commission with < 2 year history or Child Support payments that doesn’t continue for 3 years will be excluded from the Qualifying Income; but will be included in the Eligibility Income to see if they qualify for a CalHFA loan. TIP <ul><li>Check the allowable income permitted on both the 1 st and the 2 nd mortgage and if applicable the 3 rd mortgage. In some cases, the income requirements differ depending on family size for CalHFA. </li></ul><ul><li>Conventional loans only: Check Tax Returns for any 2106 expenses, average it for 24 months and deduct from monthly income used for qualifying. CalHFA will not accept a letter from borrower stating they no longer have those expenses or file a 2106. </li></ul>
    13. 13. Sales Price Limits 06/06/09 CalHFA maintains Sales Price limits that compare favorably to the Median Sales Price for each County in most cases. See samples below – March ‘08 CalHFA Sales Price Limits vs. May ‘08 Median Sales Prices: CalHFA Sales Price Limits (Mar. 08) vs. Median Sales Price (May 2008) (Non Targeted Resale areas) County CalHFA Sales Price Limits (Mar. 08) Median Sales Price Est . (May. 08) Fresno $381,250.00 $220,000.00 Kern $368,750.00 $210,750.00 Los Angeles $729,750.00 $420,500.00 Orange $729,750.00 $485,000.00 Merced $472,500.00 $176,000.00 Riverside $500,000.00 $287,250.00 San Bernardino $500,000.00 $250,000.00 San Diego $697,500.00 $380,000.00 Sacramento $580,000.00 $225,000.00 Stanislaus $429,619.00 $214,500.00 Tulare $325,000.00 $199,500.00 Often New Construction Sales Price Limits and Sales Price Limits in Targeted areas are substantially higher than the Non-Targeted Resale Limits. Source: www.calhfa.ca.gov March 2008 & California Association of Realtors Sales Reports for May 2008
    14. 14. CA Median Sales Price Comparison 06/06/09 CA Median Home Price Comparison Comparison Chart (November 2007 – May 2008) (Non Targeted Resale areas) County May 2008 April 2008 Feb 2008 Jan 2008 Dec 2007 Nov 2007 Fresno $220,000.00 $237,250.00 $250,000.00 $250,000.00 $256,500.00 $250,750.00 Kern $210,750.00 $215,000.00 $230,500.00 $224,000.00 $240,000.00 $246,000.00 Los Angeles $420,500.00 $435,000.00 $460,000.00 $460,000.00 $470,000.00 $497,000.00 Orange $485,000.00 $505,000.00 $520,000.00 $520,000.00 $560,000.00 $593,000.00 Merced $176,000.00 $186,000.00 $225,500.00 $215,000.00 $253,750.00 $266,000.00 Riverside $287,250.00 $294,000.00 $325,000.00 $331,500.00 $354,000.00 $359,000.00 San Bernardino $250,000.00 $265,000.00 $290,000.00 $297,000.00 $313,750.00 $330,000.00 San Diego $380,000.00 $400,000.00 $413,500.00 $430,000.00 $437.000.00 $442.500.00 Sacramento $225,000.00 $232,000.00 $254,000.00 $250,000.00 $280,000.00 $288,750.00 Stanislaus $214,500.00 $225,000.00 $250,250.00 $260,000.00 $281,500.00 $285,000.00 Tulare $199,500.00 $196,000.00 $216,500.00 $210,000.00 $219,500.00 $231,500.00 Often New Construction Sales Price Limits and Sales Price Limits in Targeted areas are substantially higher than the Non-Targeted Resale Limits. Source: California Association of Realtors 2008 Sales Report
    15. 15. Property Eligibility 06/06/09 <ul><li>FHA: </li></ul><ul><li>Order Case # </li></ul><ul><li>Assign your appraiser </li></ul><ul><li>Follow property requirements for FHA/VA </li></ul><ul><li>Conventional: </li></ul><ul><li>Follow standard Fannie Mae Requirements </li></ul><ul><li>Condominiums: </li></ul><ul><li>Follow Fannie’s Condo Project Approval Requirements including % of O/O </li></ul>Eligible Property Types <ul><ul><li>SFR – (no in-law units/granny flats) </li></ul></ul><ul><ul><ul><li>5 acre maximum </li></ul></ul></ul><ul><ul><li>PUD – Detached or Attached </li></ul></ul><ul><ul><li>Condominium (50% mininum occupancy ratio required) </li></ul></ul><ul><ul><li>Attached half-plex not part of a PUD or Condo </li></ul></ul><ul><ul><li>Manufactured Home @ 90% CLTV (97% for FHA) </li></ul></ul><ul><ul><ul><li>10% down payment required from borrower’s own funds </li></ul></ul></ul>Ineligible Properties <ul><li>No Income Producing properties </li></ul><ul><li>No business use of home (See Tax Return for IRS deduction) </li></ul><ul><li>Only 1 Unit per loan – no separate dwelling will be considered for financing </li></ul>Appraisals <ul><li>One of the following appraisal forms is acceptable: </li></ul><ul><li>Uniform Residential Appraisal Report (URAR) </li></ul><ul><li>Fannie Mae/Freddie Mac form 2055 (interior/exterior inspection) </li></ul><ul><li>Form 1004C (Manufactured Home Appraisal Report) </li></ul><ul><li>Form 1073 (Individual Condominium Unit Appraisal Report) </li></ul>
    16. 16. <ul><li>30 Year Fixed - Conventional & Government </li></ul><ul><li>40 Year Fixed - Conventional </li></ul><ul><li>35 Year Interest Only Plus – Conventional </li></ul><ul><li>**CalHFA HAS NOT adopted the Declining Market Reduction of 5% to LTV/CLTV** </li></ul>1 st Mortgage Programs 06/06/09 Affinity Lending Group
    17. 17. CalHFA Programs Types <ul><li>Available 1 st Mortgage Products: </li></ul><ul><ul><ul><li>CalHFA Conventional Fixed Rate Loans (Fannie My Community Mortgage / Freddie Home Possible) </li></ul></ul></ul><ul><ul><ul><ul><li>30 Year Fixed Mortgages </li></ul></ul></ul></ul><ul><ul><ul><ul><li>40 Year Fixed Mortgages </li></ul></ul></ul></ul><ul><ul><ul><ul><li>35 Year Interest Only Plus </li></ul></ul></ul></ul><ul><ul><ul><li>CalHFA Government Insured/Guaranteed Fixed Rate Loans </li></ul></ul></ul><ul><ul><ul><ul><li>FHA 30 Year Fixed </li></ul></ul></ul></ul>06/06/09
    18. 18. Conventional 30 Yr Fixed 06/06/09 Topic Description Interest Rate <ul><li>Interest Rate is Fixed & Fully Amortized for the entire term of the loan. </li></ul><ul><li>Rate is based on income levels as follows: </li></ul><ul><ul><li>Moderate Income – 7.00% as of 7/24/08 </li></ul></ul><ul><ul><li>Low Income – 6.50% as of 7/24/08 </li></ul></ul>Reduced Rates <ul><li>Automatic Interest Rate Reduction if: </li></ul><ul><ul><li>Borrower’s Income is in the low income category, OR </li></ul></ul><ul><ul><li>The Borrower is eligible for the ECTP </li></ul></ul>Term 30 Years LTV Max LTV: 95% Manufactured Home Max LTV: 90% CLTV Max CLTV: 102% Manufactured Home Max CLTV: 90% Max Origination Fee 1.50% Origination Fee (or combination of Origination Fee & Discount Points) Discount Fee Allowed – See Origination Fee for maximum allowed Max Loan Amount 100% of allowable sales price in county where property is located Subordinate Financing AHPP, SFF, HICAP (Conventional Only) or CHAP, ECTP or CHDAP
    19. 19. Conventional 40 Yr Fixed 06/06/09 Topic Description Interest Rate Interest Rate is Fixed & Fully Amortized for the entire term of the loan. (No differential in interest rate between counties and income levels) Term 40 Years – Currently @ 7.125% as of 7/24/2008 LTV Max LTV: 95% Manufactured Home Max LTV: 90% CLTV Max CLTV: 102% Manufactured Home Max CLTV: 90% Max Origination Fee 1.50% Origination Fee (or combination of Origination Fee & Discount Points) Discount Fee Allowed – See Origination Fee for maximum allowed Max Loan Amount 100% of allowable sales price in county where property is located Subordinate Financing AHPP, SFF, HICAP (Conventional Only) or CHAP, ECTP or CHDAP
    20. 20. Conventional Interest Only Plus 06/06/09 Topic Description Interest Rate Interest Rate is Fixed for the entire term of the loan. Currently at 7.00% Conf IO (Up to $450k) and 7.375% Non Conf IO (> $450k) as of 7/24/2008. Qualifying Rate Qualify borrower at the Fully Amortized Rate Term 35 Year Term: Interest-only payments for the first 5 years, followed by a 30-year fully amortized loan LTV Max LTV: 95% Manufactured Home Max LTV: 90% CLTV Max CLTV: 102% Manufactured Home Max CLTV: 90% Max Origination Fee 1.50% Origination Fee (or combination of Origination Fee & Discount Points) Discount Fee Allowed – See Origination Fee for maximum allowed Max Loan Amount Conforming IO loans – Up to $450,000 Non Conforming – Over $450,000 up to 100% of allowable sales price in county where property is located Subordinate Financing HICAP (Conventional Only) or CHAP, ECTP or CHDAP, SFF
    21. 21. Government Insured 30 Yr Fixed 06/06/09 Topic Description Interest Rate <ul><li>Interest Rate is Fixed & Fully Amortized for the entire term of the loan. </li></ul><ul><li>Rate is based on income levels as follows: </li></ul><ul><ul><li>Moderate Income </li></ul></ul><ul><ul><ul><li>7.00% as of 7/24/2008 </li></ul></ul></ul><ul><ul><li>Low Income </li></ul></ul><ul><ul><ul><li>6.50% as of 7/24/2008 </li></ul></ul></ul>Term 30 Years LTV Max LTV: 97.15% (FHA), 100% (VA) Max LTV includes UFMIP CLTV Max CLTV: 102% Max CLTV includes UFMIP Max Origination Fee 1.00% Origination Fee Discount Fee .500% Max Loan Amount FHA Loan Limit Subordinate Financing AHPP, CHAP, SFF, ECTP or CHDAP NEW : All CalHFA Government loans with CalHFA Subordinate Financing must meet CalHFA Conventional Loan UW guidelines. This includes Credit history, DTI, subordinate financing, etc. FHA/VA loans still follow FHA/VA loan amounts and LTV calculations. Eg., LTV > 95% requires min. 680 score; 620 for =<95% LTV
    22. 22. Subordinate Financing Options 06/06/09 * Different Income Limits Affinity Lending Group ECTP AHPP SFF * HICAP ( Conventional loans only ) CHAP CHDAP *
    23. 23. No Down Payment? No Problem! 06/06/09 <ul><li>Recently awarded funds </li></ul><ul><ul><li>Awarded by CalHFA to various Cities, Redevelopment Agencies, etc. for Down Payment Assistance Programs for Homebuyers : </li></ul></ul><ul><li>Down payment Assistance Programs: </li></ul><ul><ul><li>Because CalHFA funds are from MRB, any Subordinate Financing behind a 1 st must be from a Non-Profit Redevelopment Agency, City or County Govt. (Locality). </li></ul></ul><ul><ul><li>CalHFA offers several different down payment assistance programs. These funds can be used towards down payment or cover closing costs. </li></ul></ul><ul><ul><li>Payments are deferred meaning you don’t have to pay it back until you sell, refinance or pay in full. </li></ul></ul>
    24. 24. AHPP 06/06/09 Affordable Housing Partnership Program (CalHFA partnerships with non-profit agencies & municipalities) AHPP is a joint effort between CalHFA and over 300 cities, counties, redevelopment agencies, housing authorities and non-profit housing organizations. Target Market Low Income First-Time Home Buyers ONLY How do I get financing? Low Income FTHB who obtain direct financial assistance from a local government agency or locality with their Down Payment and/or Closing Cost may be able to obtain a CalHFA below market interest rate (30 Yr Fixed Only Curr. Rate is 6.50% as of 7/24/08) Requirements <ul><li>CalHFA must approve all subordinate financing to be used with our 1 st mortgage </li></ul><ul><li>Subordinate documents must be submitted with prior approval package </li></ul>Loan Amount, Interest Rate, Term Set by Locality Lien Position Subordinate behind a CHAP OR HICAP loans Combine with other assistance Yes – set by locality. See CalHFA AHPP List for restrictions CalHFA AHPP List See CalHFA AHPP List for approved program list
    25. 25. CHAP 06/06/09 CalHFA Housing Assistance Program (Available with a Conventional or FHA 1 st Mortgage) Target Market Low to Moderate Income First-Time Home Buyers (See website for eligible counties) Monthly Payments Silent 2 ND loan with NO SCHEDULED MONTHLY PAYMENTS Loan Amount 2% of Sales Price or Appraised Value whichever is less for properties in CHAP designated areas Term Matches term of 1 st Mortgage - 30 Years Use of Funds For Down Payment ONLY Interest Rate 7.00% Simple Interest Income Restriction Borrower’s Income cannot exceed CalHFA Income Limits Due Date Deferred until the Note becomes due and payable, paid in full, refinanced, or if the property is sold or transferred Lien Position 2 nd Combine with other Assistance AHPP, SFF, an d/or ECTP or CHDAP (only one) CHAP 2 ND IS NOT FORGIVEN (CANNOT BE COMBINED WITH A HICAP 2 ND LOAN)
    26. 26. CHDAP 06/06/09 California Homebuyer’s Downpayment Assistance Program ( Available with CalHFA or Non CalHFA 1 st Mortgage ) **CalHFA just received an additional $100 Mil as a result of Proposition 1C to continue funding this program making it possible for more homebuyers in CA to purchase a home** Target Market Low to Moderate Income First-Time Home Buyers Monthly Payments Silent 2 ND loan with NO SCHEDULED MONTHLY PAYMENTS Loan Amount 3% of Sales Price or Appraised Value whichever is less Term Matches term of 1 st Mortgage Use of Funds Can be used for Down Payment or Closing Costs Interest Rate 3.25% Simple Interest Due Date Deferred until the Note becomes due and payable, paid in full, refinanced, or if the property is sold or transferred Income Restrictions Borrower’s Income cannot exceed HCD Moderate defined Income Limits Lien Position May be a Junior to all loans Combine with other DAP AHPP, HICAP (Conventional Only), SFF, CHAP CHDAP 2 ND IS NOT FORGIVEN (Cannot be combined with ECTP) NEW : All CHDAP regardless of insurer of 1 st Mortgage must meet CalHFA Conventional Loan UW guidelines. This includes Credit history, DTI, etc. Eg., LTV > 95% requires min. 680 score; 620 for =<95% LTV
    27. 27. HICAP 06/06/09 High Cost Area Home Purchase Program (Available in CalHFA High Cost Counties – CONVENTIONAL ONLY ) Target Market FTHB purchasing in CalHFA designated High Cost Counties (See website for eligible counties) Monthly Payments Silent 2 ND loan with NO SCHEDULED MONTHLY PAYMENTS Loan Amount 4% of Sales Price or Appraised Value whichever is less for properties in designated HICAP areas Term Matches term of 1 st Mortgage Use of Funds Can be used for Down Payment Assistance ONLY Interest Rate 7.00% Simple Interest Due Date Deferred until the Note becomes due and payable, paid in full, refinanced, or if the property is sold or transferred Income Restriction Borrower’s Income cannot exceed CalHFA Income Limits Lien Position Must record in 2 nd lien position Combine with other assistance AHPP, SFF , and/or ECTP or CHDAP (only one) HICAP 2 ND IS NOT FORGIVEN (CANNOT BE COMBINED WITH CHAP 2 ND LOAN)
    28. 28. ECTP “Buying your 1 st Home on a Teacher’s Salary can be tough – Now it just got easier!” 06/06/09 Extra Credit Teachers Program (Can be used as a 1 st or a 2 nd ) (Eligible Teachers, Administrators, Classified Employees & Staff Members) Target Market FTHB Eligible Teachers, etc. of High Priority Schools across CA with API Rank of 1-5 Monthly Payments Silent 2 ND loan with NO SCHEDULED MONTHLY PAYMENTS Loan Amount <ul><ul><li>Greater of $7,500 or 3% of Sales Price for Non High-Cost Co. OR </li></ul></ul><ul><ul><li>Greater of $15,000 or 3% of Sales Price for High-Cost Counties </li></ul></ul>Use of Funds Can be used for Down Payment ONLY Term Matches term of 1 st Mortgage Interest Rate 5.25% Simple Interest – Interest Rate can be reduced to 0% if borrower meets certain requirements Due Date Deferred until the Note becomes due and payable, paid in full, refinanced, or if the property is sold or transferred Income Restrictions Borrower’s Income cannot exceed CalHFA Income Limits Other Requirements <ul><li>If use as 1 ST Mortgage, MUST BE A 30 YR FIXED PROGRAM (Currently @ 6.50%) </li></ul><ul><li>If use as a 2 nd Mortgage, rate is currently @ 5.25% </li></ul><ul><li>Agree to a 3 Year Continuous employment at a High Priority School </li></ul>Lien Position May be Junior to all loans Combine with other assistance AHPP, CHAP, HICAP (Conventional Only), or SFF ECTP 2 ND IS NOT FORGIVEN (Cannot be combined with CHDAP) List of High Priority Schools
    29. 29. SFF 06/06/09 School Facility Fee Down Payment Assistance Program (Available for Single Family New Construction Homes) Target Market California FTHBs purchasing newly constructed SFRs or Condos Monthly Payments Conditional Grant loan with NO SCHEDULED MONTHLY PAYMENTS Loan Amount <ul><ul><li>Partial Rebate of eligible SFF paid by the Builder/Developer for SFF Program #1; Full Rebate of eligible SFF paid by Builder/Developer for SFF Program #2 </li></ul></ul>Lien Position <ul><ul><li>May be Junior to all loans </li></ul></ul>Combine with other assistance <ul><ul><li>Yes – No Limitations </li></ul></ul>Use of Funds Can be used for either Down Payment or Closing Costs Interest Rate Grant is forgivable after 5 years (Not subject to Recapture) Program # 1 To encourage home buying in economically distressed counties - See CalHFA SFF Program for eligible counties & sales price limits . No FTHB requirement . Program #2 For moderate income FTHB using HCD Income Limits; not subject to Sales Price limitations Other Requirements <ul><li>Any lender – Any type of 1 st Mortgage </li></ul>SFF is forgivable after 5 Years
    30. 30. Sample Combinations 06/06/09 <ul><li>Borrower with no money down and needs all the help they can get: </li></ul><ul><ul><li>Option 1 : Conventional 30 Yr Low Income borrower </li></ul></ul><ul><ul><ul><ul><ul><li>95% 1 st Mortgage </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>2% CHAP for DP </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>3% CHDAP for DP </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>2% AHPP for CC or Seller contributes closing cost </li></ul></ul></ul></ul></ul><ul><ul><li>Option 2 : Teacher in High Priority School purchasing in High Cost area </li></ul></ul><ul><ul><ul><ul><ul><li>95% 1 st ECTP 1 st Mortgage </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>3% ECTP 2 nd for DP (lower interest rate) </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>2% HICAP 3 rd for DP </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Same as above for CC </li></ul></ul></ul></ul></ul><ul><ul><li>Option 3 : FHA 30 Yr Credit problems </li></ul></ul><ul><ul><ul><ul><ul><li>97% FHA 1 st </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>1.25% – 2.25% for UFMIP depending on fico score </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Up to 3% Nehemiah Gift Funds for down payment or CHDAP </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Seller contributes closing cost </li></ul></ul></ul></ul></ul>
    31. 31. <ul><li>NEW: REO Program – CSHLP </li></ul><ul><ul><li>COMING SOON TO ALG… </li></ul></ul><ul><li>Builder Block Program (BLOCK) </li></ul><ul><li>Home Openers </li></ul>Special Programs 06/06/09 Affinity Lending Group
    32. 32. Coming soon… NEW REO Program (Community Stabilization Home Loan Program) 06/06/09 Topic Description Interest Rate Interest Rate is Fixed & Fully Amortized for the entire term of the loan. Rate is currently at: 5.50% as of 7/24/08 Term 30 Years Conventional Fixed LTV / CLTV Max LTV: 100% Max CLTV: 103% Max Origination/Discount 1.50% Origination Fee (or combination of Origination Fee & Discount Points) Other Fees <ul><li>Fannie Mae Adverse Market Fee </li></ul><ul><li>MCM Loan Level Price Adjustment Fees </li></ul>Max Loan Amount Lesser of CalHFA Sales Price Limit or Fannie Mae maximum loan limit for county where property is located Occupancy / Type Owner Occupied Purchase Transactions only Subordinate Fin CHDAP, AHPP may be used for Down Payment Mortgage Insurance LTV: Coverage: Premium: 97.01 - 100% 20% .59% 95.01 - 97% 18% .50% 90.01 - 95% 16% .46% 85.01 - 90% 12% .34% 80.01 - 85% 6% .23%
    33. 33. NEW – REO Program Cont’d… 06/06/09 Topic Description Eligible Properties <ul><li>Property must be a selected REO from a participating financial institution or seller/servicer </li></ul><ul><ul><li>Fannie Mae </li></ul></ul><ul><ul><li>CitiMortgage </li></ul></ul><ul><ul><li>Wells Fargo </li></ul></ul><ul><ul><li>HomEq Servicing </li></ul></ul><ul><li>Properties must meet all CalHFA and Fannie Mae repair, inspection, and health and safety code requirements </li></ul><ul><li>Property must be vacant. </li></ul><ul><li>Property must be an existing single-family, one-unit residence, including approved condominium /PUDs (50% occupancy ratio required on existing condominiums) </li></ul><ul><li>Manufactured housing is NOT eligible. </li></ul>Property Locations <ul><li>Eligible Counties & Zip Codes </li></ul>Underwriting <ul><li>All CSHLP loans must meet Fannie Mae MCM underwriting standards, CalHFA’s Conventional Loan Underwriting Guidelines , and this Program as follows: </li></ul><ul><li>Credit Score Minimums: </li></ul><ul><ul><li>LTV > 95% - 680 </li></ul></ul><ul><ul><li>LTV =< 95% - 660 </li></ul></ul><ul><li>If no score is available, alternative documentation may be used only on loans with an LTV of 95% or less that have borrowers who demonstrate credit worthiness. </li></ul>
    34. 34. BLOCK Program (Builder Lock) 06/06/09 Builder Lock Program Block Program is available for new construction only allowing Builders/Developers the opportunity to purchase forward commitments for permanent 1 st Mortgage financing for CalHFA eligible borrowers. Target Market Builders / Developers Maximum Loan Amount <ul><ul><li>$1,000,000 up to $15,000,000 depending on Developer/Builders Volume history with CalHFA. </li></ul></ul><ul><ul><li>New Developers or Builders will get the minimum allocation until history has been established with CalHFA. </li></ul></ul>Available Programs CalHFA 30 and 40 Year programs – 35 Yr. IO NOT AVAILABLE Minimum # Units Minimum 8 Units per development Other Requirements Forward Commitment locks only the interest rate Available Lock Terms (For Profit Developers) See website for Non-Profit Developer Fees <ul><li>180 Days – No Fee (Single Loan Process) </li></ul><ul><li>6 Mos with .50% NO UP FRONT FEE (.50% at Discount) </li></ul><ul><li>9 Mos with 1.50% Fee (.75% Cash Up; .75% at Discount) </li></ul><ul><li>12 Mos with 2.00% Fee (1.00% Cash Up; 1.00% at Discount) </li></ul>Affordable Developers Developers who may have selection of homes within CalHFA sales price limits
    35. 35. HomeOpeners 06/06/09 Home Protection Insurance CalHFA offers a Mortgage Protection Program called “Homeopeners” to CalHFA insured loans insuring borrowers in case they become involuntarily unemployed. Cost NO COST to the borrower Eligibility <ul><li>Comes standard with all Conventional loans where MI is required. </li></ul><ul><li>Available on all new loans closed after 4/1/2005 </li></ul><ul><li>Covers all borrowers and will be pro-rated upon unemployment of borrower based on income contribution </li></ul>How do you Qualify? <ul><ul><li>If you qualify for unemployment, you qualify for Homeopeners </li></ul></ul><ul><ul><ul><li>Seasonal, temporary, voluntary and self employed will not be covered </li></ul></ul></ul>Term 5 Years provided CalHFA MI coverage remains in effect Benefit of the Program <ul><li>Pays up to $2,500 of monthly mortgage payments. </li></ul><ul><ul><li>Lesser of the actual monthly payment (PITI) to a max $2,500 </li></ul></ul><ul><li>Covers a maximum of 6 months during the life of the coverage. </li></ul><ul><ul><li>Exception: Benefit is not payable during the Vesting Period (60 days from effective date) </li></ul></ul><ul><ul><li>Waiting period is 30 days after unemployment. They will receive the benefit if they’re still unemployed after the 30 days are over </li></ul></ul><ul><li>Covers the first 5 years of the loan provided MI is still in effect </li></ul>
    36. 36. <ul><li>Underwriting Methods </li></ul><ul><li>General Underwriting Guidelines </li></ul><ul><li>Mortgage Insurance </li></ul><ul><li>Recapture Tax </li></ul>General Information 06/06/09 Affinity Lending Group
    37. 37. Underwriting Methods 06/06/09 Acceptable Underwriting Methods MANUAL UNDERWRITING AUTOMATED UNDERWRITING Conventional Loans Follow agency and CalFHA UW Guidelines Fannie Mae DU Allowed Freddie Mac LP Allowed FHA/VA Loans <ul><ul><li>Follow standard FHA/VA Guidelines </li></ul></ul>Fannie Mae DU Allowed Freddie Mac LP Allowed Fannie Mae DU Recommendation Approve Ineligible, Expanded Approvals require Manual UW Approve Eligible, Approve Ineligible recommendations allowed Freddie Mac LP Recommendation Refer or Caution requires Manual Review and/or UW <ul><li>Accept Recommendation allowed </li></ul><ul><li>LP Home Possible must be manual UW only </li></ul>Exceptions to minimum credit score and maximum DTI are possible with strong compensating factors on a case-by-case basis. Brokers or AE’s are required to ensure all loans submitted are documented in accordance with the automated underwriting findings report.
    38. 38. General UW Guidelines 06/06/09 CREDIT Manual UW Automated UW Minimum Credit Score Conventional: 620 Regardless of AUS findings FHA: Determined by AUS Finding or FHA guidelines. If CalHFA subordinate financing is used , 620 for LTV =<95%; 680 for >95% LTV regardless of AUS Alternative Credit <ul><ul><li>Permitted. Minimum 4 sources with 12 mo. Satisfactory payment record. One of the sources must be a 12 month VOR history. </li></ul></ul>BK (Ch. 7 & 13) / Foreclosure Minimum 3 yrs discharge date / foreclosure sale & evidence of reestablished credit Loans with prior BK / foreclosure must be manually UW Collections If individual account balance is less than $250, or the total is $1,000 or less, does not require to be paid off at or prior to closing Determined by AUS Deferred Student Loans Conventional: Deferred payment amount must be included in total DTI calculation. FHA: Do not count if deferred for more than 12 months. Consumer Credit Counseling As long as DU approves it. No seasoning just good payment history and they meet credit score requirements. Include payment in DTI calculation. Exceptions to minimum credit score and maximum DTI are possible with strong compensating factors on a case-by-case basis. Brokers or AE’s are required to ensure all loans submitted are documented in accordance with the automated underwriting findings report.
    39. 39. General UW Guides Cont’d 06/06/09 RATIOS & INCOME Manual UW Automated UW Max DTI 45% 55% (regardless of AUS findings) Temporary Buy-downs <ul><ul><li>Allowed: Conventional: 3/2/1, 2/1, 1/1 FHA: 2/1, 1/1 </li></ul></ul><ul><ul><li>Allowed on 30 & 40 Yr. Loans only </li></ul></ul><ul><ul><li>Determined by AUS </li></ul></ul>Qualifying Rate for Temporary Buy-down <ul><ul><li>LTV =< 95% - Qualify at the Buydown Rate PLUS 1% </li></ul></ul><ul><ul><li>LTV > 95% - Qualify at Note Rate </li></ul></ul><ul><ul><li>Determined by AUS </li></ul></ul>Permanent Buy-downs <ul><ul><li>Not Permitted on CalHFA loans </li></ul></ul>Non Occupying Co-Signer Permitted with LTV 90% or less. Total DTI max 45%. Occupant borrower(s) DTI max is 55%. Non Occupying Income used for Qualifying only and not for Eligibility Boarder Income NOT PERMITTED Variable Income (PT/OT/2 nd Job/Bonus Income) Permitted with a minimum 12 mo. history Determined by AUS
    40. 40. General UW Guides Cont’d 06/06/09 FUNDS TO CLOSE Manual UW Automated UW Minimum Down Payment No minimum down payment except for manufactured home loans which require 10% from borrower’s own funds Minimum Borrower Cash Contribution No borrower cash contribution required Cash Reserves <ul><ul><li>1 Month ( Gift funds may supplement ) </li></ul></ul><ul><ul><li>Determined by AUS </li></ul></ul>Gift Funds <ul><ul><li>Permitted from family members. No Maximum. </li></ul></ul><ul><ul><li>May be used to supplement cash reserves. </li></ul></ul>Interested Party Contributions <ul><li>Contributions by any interested party towards recurring and/or non-recurring closing costs are limited to: </li></ul><ul><ul><ul><li>3% of the purchase price if LTV is > 90% </li></ul></ul></ul><ul><ul><ul><li>6% if the LTV is 90% or less </li></ul></ul></ul><ul><li>Any contribution exceeding these limits requires a downward adjustment to the sales price to reflect the amount that exceeds the limit </li></ul>
    41. 41. General Guidelines 06/06/09 OTHER Manual UW Automated UW Impounds Impounds are mandatory on all CalHFA loans regardless of LTV. Prepayment Penalties <ul><ul><li>No Prepayment Penalties </li></ul></ul>Assumable <ul><ul><li>Yes on Government loans only with prior approval from FMC </li></ul></ul>Non Occupant Co-Borrowers Not Allowed
    42. 42. MORTGAGE INSURANCE 06/06/09 MORTGAGE INSURANCE Manual UW Automated UW Monthly Mortgage Insurance Zero Upfront Monthly Mortgage Insurance (ZUMMI) is provided by CalHFA Mortgage Insurance Services and is required on all Conventional 1 st Mortgage loans with an LTV > 80% Conventional MI Rates <ul><ul><li>LTV </li></ul></ul><ul><ul><li>PREMIUM </li></ul></ul><ul><ul><li>90.01 – 95% </li></ul></ul><ul><ul><li>85.01 – 90% </li></ul></ul><ul><ul><li>80.01 – 85% </li></ul></ul><ul><ul><li>0.90% </li></ul></ul><ul><ul><li>0.67% </li></ul></ul><ul><ul><li>0.62% </li></ul></ul>MI – Government Loans <ul><ul><li>FHA / VA Insured </li></ul></ul>Financed or Split Level MI Not Available UPDATE: MI Certificate will be issued with Compliance package.
    43. 43. PMI Cancellation <ul><li>How do I request cancellation of Private Mortgage Insurance (PMI)? </li></ul><ul><li>In order to consider cancellation of MI on Conventional loans, the borrower will need to submit a request in writing to CalHFA and meet the following criteria: </li></ul><ul><ul><li>LTV of 80% (70% if subordinate liens other than CalHFA subordinate loans created at closing are present) </li></ul></ul><ul><ul><li>LTV will be based on original value. If current value must be used, a Full Appraisal must be ordered through CalHFA at a cost of approximately $360 to be paid by the borrower. </li></ul></ul><ul><ul><li>Provide a current title search or property profile </li></ul></ul><ul><ul><li>Loan is at least 2 years old </li></ul></ul><ul><ul><li>Mortgage Payment: 0 x 30 x 12; and 0 x 60 x 24 </li></ul></ul><ul><ul><li>Owner Occupied </li></ul></ul><ul><ul><li>All fees due are paid </li></ul></ul><ul><ul><li>Lines of credit will be considered as if fully funded regardless of the current balance </li></ul></ul><ul><li>MI on FHA loans cannot be deleted as they are collateral for tax exempt bonds. </li></ul>06/06/09
    44. 44. Recapture Tax Cont’d… 06/06/09 Topic Guideline(s) Federal Recapture <ul><li>Recapture Only Applicable when all of the following Occur: </li></ul><ul><li>Property is sold within the 1 st 9 years </li></ul><ul><li>There is a capital gain upon sale, AND </li></ul><ul><li>Homebuyer’s income exceeds the allowable income limit in the year in which the property is sold </li></ul>Recapture Tax Fee <ul><li>6.250% of the Original Loan Amount or up to 50% of the gain realized on the sale of the property, whichever is less </li></ul>Recapture Tax Scale <ul><ul><li>Recapture Tax is figured on a scale based on the number of years the homebuyer has lived in the house with Year 5 being the worse year to sell. Holding Period – Example: </li></ul></ul><ul><ul><ul><li>Year 1 & Year 9 = 20% of the recapture </li></ul></ul></ul><ul><ul><ul><li>Year 2 & Year 8 = 40% of the recapture </li></ul></ul></ul><ul><ul><ul><li>Year 3 & Year 7 = 60% of the recapture </li></ul></ul></ul><ul><ul><ul><li>Year 4 & Year 6 = 80% of the recapture </li></ul></ul></ul><ul><ul><ul><li>Year 5 = 100% of the recapture </li></ul></ul></ul>Eg. Property sold Yr 3 Borrower Gross Income $65,000 (1040) Program Qual Income limit : $59,645 <ul><ul><li>Principal Loan Amount: $108,385 x 6.25% = $6,774 (Maximum possible potential recapture tax the borrower will have to pay). </li></ul></ul><ul><ul><li>Holding Period Calc: Borrower sold on Year 3: $6,774 x 60% (.60) = $4,064 </li></ul></ul><ul><ul><li>Calculate your Income Percentage: </li></ul></ul><ul><ul><ul><li>Modified Adjusted Gross Income LESS Program Qualifying Inc / $5,000 </li></ul></ul></ul><ul><ul><ul><li>$65,000 - $59,645 = $5,355 / $5,000 = 1.07% (Income Percentage) </li></ul></ul></ul><ul><ul><ul><ul><li>If ZERO or LESS THAN = NO RECAPTURE TAX DUE </li></ul></ul></ul></ul><ul><ul><li>$4,064 x 1.07% = $69 (Compare to 50% of gain and you pay lesser of…) </li></ul></ul>
    45. 45. <ul><li>Interest Rate </li></ul><ul><li>Allowable Fees </li></ul>Interest Rate & Allowable Fees 06/06/09 Affinity Lending Group
    46. 46. Interest Rates & Fees 06/06/09 Topic Description CalHFA Interest Rates <ul><ul><li>You can obtain interest rates daily from the following sources: </li></ul></ul><ul><ul><li>CalHFA Website: www.calhfa.ca.gov </li></ul></ul>Max Origination Fees (Retained by Broker) <ul><ul><li>Up to 1.50% for Conventional (combination with Discount Points) </li></ul></ul><ul><ul><li>Up to 1.00% for FHA </li></ul></ul>Max Discount Fees (Retained by Broker) <ul><ul><li>Allowed up to max 1.50% (combination with Origination Fee) </li></ul></ul><ul><ul><li>Allowed up to .500% on FHA loans </li></ul></ul>Max Allowable Fees (Restricted & Retained by the lender Except for Actual 3 rd party fees) <ul><ul><li>$350 Processing Fee </li></ul></ul><ul><ul><li>$200 Document Prep fee </li></ul></ul><ul><ul><li>$250 Processing Fee for any Subordinate Financing </li></ul></ul><ul><ul><li>Actual amount of third party costs – Eg., </li></ul></ul><ul><ul><ul><li>Appraisal, Credit, Title, Escrow, Courier, Recording </li></ul></ul></ul>
    47. 47. <ul><li>Highlights of the Program </li></ul><ul><li>Affinity Lending Group Closing </li></ul>Support - Highlights 06/06/09 Affinity Lending Group
    48. 48. Highlights of the Program <ul><li>Up to100% Combined Financing available with NO down payment required </li></ul><ul><li>2 nd & 3 rd Mortgages can cover Down Payment & Closing Costs </li></ul><ul><li>CLTV’s up to 102% </li></ul><ul><li>Loan amounts above agency limits (Up to $754,134) </li></ul><ul><li>DTI to as high as 55% </li></ul><ul><li>Gift funds OK for Reserves </li></ul><ul><li>Temporary Buy-downs Available </li></ul><ul><li>Below market interest rate on 1 st mortgage loan </li></ul><ul><li>First Time Homebuyer restriction waived when property is located within a Federally designated Targeted area (certain restrictions apply) </li></ul><ul><li>No Homebuyer education required </li></ul><ul><li>DU, LP decisions accepted </li></ul><ul><li>Builder Block program for Builders/Developers </li></ul><ul><li>HomeOpener protects borrowers from unemployment </li></ul><ul><li>New REO Program coming out soon… </li></ul>06/06/09
    49. 49. <ul><li>On behalf of Affinity Lending Group, we thank you for joining our training today and hope the information provided was informative and will help you… </li></ul><ul><li>Building This Together ! </li></ul>06/06/09 Affinity Lending Group

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