Fha Loans Ppt

Offered through 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. 04 /24/2008

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Introduction to Affinity Lending Group Who is FHA? Why choose an FHA loan? Highlights of the Program Targeted Borrowers 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!

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Basic Eligibility Requirements 1. Valid Social Security # ,[object Object],[object Object],[object Object],[object Object],2. Lawful US Residency Borrower must be a lawful residency in the United States 3. Legal Age Borrower(s) must be 18 years old, or age which state permits a person to sign on a Mortgage/Deed of Trust Other eligibility factors: Income Requirements No Maximum Income Limits. Must have sufficient income to qualify for the mortgage payment and other debts. Credit Score Requirements No Minimum Credit Score Requirements. Past credit performance serves as the guide to determine a borrower’s attitude toward credit obligations.

Easier Qualifying With FHA insuring the mortgage, lenders are more willing to give terms making it easier to qualify. Since FHA will pay a claim to the lender in the event of homeownership default Smaller Down Payment 3% down payment which can come from a family member, employer, charitable organization as a gift Lower Cost FHA loans have competitive interest rates because the Federal Government insures the loans Less than perfect credit Even if borrower(s) had credit problems in the past such as a BK, it’s easier to qualify for an FHA than a conventional loan More protection to keep home ,[object Object],[object Object],Get to closing faster: ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Protections & Advantages ,[object Object],[object Object],[object Object],[object Object]

Borrowers who fit one or more of the following criteria's: First Time Home Buyers who may not be eligible for traditional financing Borrower’s who don’t have a lot of money to put down on a house – they may have limited cash for down payment or closing costs Borrowers who need flexibility in their housing income and payment ratios Borrowers who have low to moderate incomes Borrowers who are worried about qualifying for a loan and may not qualify for a conventional loan Borrowers who don’t have perfect credit – have credit blemishes Borrower’s who live in a disadvantage neighborhood or who are interested in purchasing a property that needs repairs

Standard FHA Program FHA Jumbo Program FHA Streamline FHA Secure 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!

Topic Description Program Types FHA 30 Year Fixed FHA 15 Year Fixed Interest Rate ,[object Object],[object Object],Term 30 & 15 Years respectively Max LTV 97.15% for properties with values/sales price > $125k 97.65% for properties with values/sales price $50k - $125k 98.75% for properties with values/sales price < $50k Max CLTV 103% (100% of lesser of sales price or appraised value plus normal closing costs, prepaid expenses and discount points) Max Loan Amount ,[object Object],Max Origination Fee Up to 1.00% Discount Fee Allowed

Topic Description Program Types FHA 1 Year T-Bill ARM FHA 3/1 T-Bill ARM Interest Rate ,[object Object],[object Object],Qualifying Rate FHA 1 Year ARM – Qualify at 1% over Note Rate for LTV’s 95% or higher FHA 3/1 ARM – Qualify at the Note Rate Term 30 years Max LTV 97.15% for properties with values/sales price > $125k 97.65% for properties with values/sales price $50k - $125k 98.75% for properties with values/sales price < $50k Max CLTV 103% (100% of lesser of sales price or appraised value plus normal closing costs, prepaid expenses and discount points) Max Loan Amount ,[object Object],Max Origination Fee Up to 1.00% Discount Fee Allowed

Topic Description Occupancy Owner Occupied Loan Purpose ,[object Object],[object Object],[object Object],Purchase or R&T Refinance Max Loan Amount Max LTV Minimum Fico Score FHA Maximum Loan Limit 97.15% for AV > $125,000 None 97.65% for AV > $50k 98.75% for AV < $50,001 ,[object Object],[object Object],Cash Out Refinance Max Loan Amount Max LTV Minimum Fico Score FHA Maximum Loan Limit 85% < 12 mos. own None 95% 12+ mos. own ,[object Object],[object Object],[object Object],[object Object],[object Object]

Eligible Programs Maximum Loan Amounts General Guidelines Matrix Appraisal Requirements 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!

Good with credit approvals through 12/31/08 Topic Description Eligible Programs ,[object Object],[object Object],[object Object],Program Types ,[object Object],[object Object],Interest Rate Interest rate is fixed and the payment is fully amortized over the entire term of the loan. Max Loan Amount ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Minimum Fico Score ,[object Object],Maximum DTI ,[object Object],Underwriting Method Manual Underwrite Only

Good with credit approvals through 12/31/08 FHA Loans Exceeding $417,000 – Additional Credit Parameters Cash Out Refinance limited to 85% LTV ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],All other guidelines with the exception of the above follow standard FHA eligibility requirements . Refer also to Mortgagee Letter 2008-06. Purchase or R&T Refinance Max Loan Amount Max LTV Minimum Fico Score FHA Maximum Loan Limit 97% 580 Cash Out Refinance Max Loan Amount Max LTV Minimum Fico Score $417,000 95% 580 > $417,000 85%

Good with credit approvals through 12/31/08 Topic Description When is a 2 nd appraisal required? ,[object Object],[object Object],[object Object],How is a declining market determined? ,[object Object],[object Object],[object Object],Who can perform the 2 nd appraisal? ,[object Object],[object Object],[object Object],When must the mortgage amount be reduced? ,[object Object],*** FHA DECLINING MARKET RULE *** A reduction in maximum allowable LTV/CLV is not required for regular FHA loans in declining market areas; FHA Loans exceeding $417,000 with an LTV of 95% or greater in a declining market area requires a 2 nd appraisal.

Basic Eligibility Requirements Appraisal Requirements Credit Qualification General Guidelines 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!

Topic Description FHA Streamline Refinance Streamline Refinance refers ONLY to the amount of documentation and underwriting that needs to be performed by the lender and does not mean that there are no costs involved in the transaction. Basic Requirements of the program? ,[object Object],[object Object],[object Object],[object Object],Possible structures ,[object Object],[object Object],[object Object],Without Appraisal Loan amount will be lower of original loan amount plus new upfront premium OR the sum of the existing lien plus closing costs, discount points, prepaid items , etc. With Appraisal Loan Amount is the lower of the LTV using the appraiser’s value OR the sum of the existing lien plus related closing costs and prepaid items .

Topic Description Credit Qualification There is NO CREDIT QUALIFICATION if using “With Appraisal” or “Without Appraisal”. However, if the new loan terms will increase the borrower’s payment, OR when the deletion of an existing borrower will trigger the due-on-sale clause OR following an assumption (certain terms) then we use the Credit Qualifying Streamline Refinance which has the same loan amounts as stated PLUS will require credit documentation and qualifying Credit Qualifying versus NO Credit Qualifying? ,[object Object],[object Object],[object Object],[object Object],[object Object],Max LTV/CLTV Follow standard FHA guideline maximum LTV/CLTV UW Guides All other guidelines follow standard FHA guidelines Additional Information ,[object Object],[object Object]

Introduction to FHA Secure Eligibility Guidelines General Guidelines Underwriting Guidelines Frequently Asked Questions 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!

You worked hard for homeownership! FHA has helped millions of Americans secure their dream of homeownership. Now we want to keep those dreams alive! Topic Description What is the FHA Secure Program? ,[object Object],Impact of FHA Secure **FHASecure is expected to help 500,000 families by 12/31/08** From 2007-2009, 2.3 million ARMS are expected to reset (1/4 of which are at risk of foreclosure). Since September 2007, FHA has pumped $68 billion into the housing market; $28 billion of it is in the FHASecure program helping more than 150,000 homeowners. How can FHA Secure help homeowners stay in their homes? FHASecure gives homeowners with non-FHA adjustable rate mortgages (ARMS) the ability to refinance into an FHA insured mortgage and the borrower will not be disqualified just because they’re delinquent. FHA Secure isn’t going to help all borrowers so why is FHA making it available? FHA recognizes that foreclosures and vacant properties affect home values, contribute to neighborhood decline and cost local government additional services and lost revenue. FHA is hoping this program will help prevent that type of negative impact on communities.

Who is Eligible? ,[object Object],[object Object],[object Object],[object Object],Eligibility Highlights of the FHA Secure Initiative ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Topic Description Maximum LTV **NEW** ,[object Object],[object Object],[object Object],[object Object],Maximum Loan Amount ,[object Object],[object Object],Loan Purpose ,[object Object],UW Method FHA encourages the use of FHA’s TOTAL Mortgage Scorecard to obtain risk classifications on each loan under the FHASecure initiative. TOTAL is already built into DU & LP **Must indicate on the MCAW that the loan is an FHA Secure Mortgage!** Accept/Approve ,[object Object],Refer ,[object Object]

Good on applications through 12/31/08 Topic Description How does FHA define reset? Does the definition include ARMS that re-set at different intervals (Eg., 6 mos, annual, etc.)? ,[object Object],Is there a Maximum number of delinquent months that can be rolled into the new mortgage? ,[object Object],How far behind can a borrower be on a mortgage to qualify? No limit. Whether you’re current, 1 month behind or multiple months behind, the amount to be refinanced will depend on the value of property, amount owed, and if lender or another eligible source is willing to take back a 2 nd to bridge the cap Between what is owed and the home’s value. Can a borrower be delinquent and for a certain time to be eligible? FHA Secure is no longer limited to borrowers who are delinquent. FHA encourages borrowers facing reset to refinance before they fall behind. On properties owned less than 1 yr, what value is used to determine LTV? Due to declining values, we will rely on current appraisal without the need to look at original sales price or acquisition cost.

Good on applications through 12/31/08 Topic Description Can a non-owner occupant be added to the loan for the benefit of qualifying occupants for FHA Secure ? (Will contradict FHA’s refinance guidelines) ,[object Object],[object Object],What if the value of the home is now less than what is owed? ,[object Object],[object Object],What about people in foreclosure? The program can be used even if the borrower is in foreclosure. It’ll depend on the value of the home, how much is owed and the lenders willingness to take out a 2 nd . Borrowers are encouraged to talk to the lender possibly with a HUD rep to determine the best course of action. When Note holder writes off a portion of 1 st loan amount ,[object Object],IMPORTANT NOTE: ,[object Object]

General Eligibility Guidelines General Underwriting Guidelines Other Standard Guidelines Mortgage Insurance 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!

Topic Description Eligible Borrowers ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Eligible Properties ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Non-Occupant Co-Borrower 100% of income to qualify can come from a non-occupant co-borrower Co-Signer Co-Signer’s income or credit cannot be used as the application primary source of income or credit.

Topic Description Title II (Mortgage Program Insurance Type Lender) FMC is a Title II Insured Lender ,[object Object],[object Object],[object Object],[object Object],[object Object]

Automated UW Manual UW Underwriting Methods ,[object Object],[object Object],Manual Underwriting Qualifying Ratios Follow AUS Approval ,[object Object],[object Object],[object Object],[object Object],Important Reminder for Manual UW loans: ,[object Object],[object Object],[object Object],Cash Reserves ,[object Object],[object Object],Down Payment ,[object Object],[object Object],[object Object],[object Object],[object Object]

Samples of strong compensating factors to compensate for a 55% DTI: ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Topic Description Credit Score Requirements ,[object Object],[object Object],Collections & Judgments ,[object Object],[object Object],[object Object],Bankruptcy (Chapter 7) ,[object Object],[object Object],[object Object],Bankruptcy (Chapter 13) 1 year seasoning from file date with all payments “As agreed” Foreclosure 3 years seasoning with re-established credit Consumer Credit Counseling ,[object Object],[object Object]

Topic Description Income Documentation Must be fully documented Miscellaneous Income Types ,[object Object],[object Object],[object Object],[object Object],Self-Employed Income ,[object Object],[object Object],Rental Income Rental Income is acceptable with a 2 year history Retirement Income Acceptable and unless documented to the contrary, retirement income may not be grossed up Non Taxable Income Disability, Public Assistance, Military Allowances, etc. may be added to the applicant’s gross income using a 1.25% factor. Overtime Income Not considered “effective” income unless verified as being received for 2 years with no statement from employer of the likelihood of continuance Projected Income Generally not allowed; exceptions OK with restrictions

Topic Description Temporary Buydowns ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Permanent B/D Allowed Seller Paid Closing Costs Seller, Real Estate Agent, Builder, Developer, etc., or a combination may contribute up to 6% of the property’s sales price toward the buyer’s actual closing costs, prepaid expenses, discount points, and other financing concessions Gift Funds Allowed for cash down payment from borrower’s relative, employer, labor union, charitable organization, governmental agency or public entity that has a program to provide homeownership assistance to low-to-moderate income FTHB, or a close friend with a clearly defined and documented interest in the borrower. “ Cash on Hand” is not an acceptable source of the donor’s gift funds Gift funds cannot come from a person or entity with an interest in the property such as seller, RE agent, broker, builder, etc except if seller is parent or RE agent is relative Impounds Impounds are Mandatory and MAY NOT BE WAIVED Assumability Government loans are assumable Prepayment Penalty No Prepayment Penalty

In most FHA programs, HUD collects an UFMIP and an Annual Mortgage Insurance Premium ( collected on a monthly Basis ) Up Front Mortgage Insurance Premium (UFMIP) Annual Mortgage Insurance Premium (AMIP) ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],SAMPLE CALCULATION $100,000 Loan amount, FHA 30 Year Fixed @ 6.50% Interest Rate Up Front Mortgage Insurance Premium (UFMIP) Annual Mortgage Insurance Premium (AMIP) $100,000 x 1.50% = $1,500 @ 6.50% for 30 years (fully amortized) = $9.48 per month $100,000 x .50% = $500 / 12 (mos) = $41.67 per month (Simple Int.) Total Mortgage Insurance Premium = $51.15 per month (9.48 + 41.67)

1. Can a Seller pay the UFMIP? Yes; it can be paid as cash at closing instead of having it financed through the loan. However, the 1.50% will be included in the 6% max seller concession for FHA loans if paid this way. 2. When can I stop paying Annual FHA Mortgage Insurance? ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Topic Description By Family Members ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],By Government Agencies ,[object Object],[object Object]

FHA Interest Rates Origination Points & Fees Closing Costs 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!

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Topic Description How much can you charge on an FHA loan? ,[object Object],[object Object],[object Object],[object Object],[object Object],Aggregate Charges ,[object Object],[object Object],[object Object],What are considered Closing Costs? ,[object Object],[object Object],[object Object],Mortgage Broker Fee ,[object Object],Real Estate Buyer Broker Fee ,[object Object]

Topic Description Origination Points Up to a maximum 1.00% Origination Fee Discount Points ,[object Object],Premium Pricing ,[object Object],[object Object],[object Object],[object Object],[object Object]

Recap 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!

Highlights of the Program? ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

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Fha Loans Ppt

Fha Loans Ppt

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