EXPAND HOMEOWNERSHIP PROGRAM

Transcription

1 EXPAND HOMEOWNERSHIP PROGRAM Administrator Guidelines Published: March 12, 2015 Revised March 13, 2015 Updates are shown on Page 4!

2 FANO EXPAND HOMEOWNERSHIP PROGRAM - Administrator Guidelines Page 2 Time Zones ehousingplus offices are all located in the Eastern Time Zone.

3 FANO EXPAND HOMEOWNERSHIP PROGRAM - Administrator Guidelines Page 3 TABLE OF CONTENTS THE FINANCE AUTHORITY OF NEW ORLEANS 5 PROGRAM ORIGINATION TEAM 5 THE PROGRAM PRODUCTS 6 Program Rates and Reservation System Availability 6 PROGRAM REQUIREMENTS 7 Eligible Borrowers 7 Minimum FICO Score 7 Homebuyer Education 7 Income Qualifying and Income Limits 7 Eligible Loan Area 7 Purchase Price Limits 7 Property Requirements 7 THE PROCESS SUMMARY 10 PROGRAM TIMETABLE 15 and 70-DAY DEADLINES 12 Loan Processing, Delivery and Purchase Timetable 12 Extension Request 12 PROGRAM FEES 13 First Mortgage Fees 13 Lender Compensation 13 PROGRAM FORMS 14 U.S. BANK WEBSITE 15

4 FANO EXPAND HOMEOWNERSHIP PROGRAM - Administrator Guidelines Page 4 UPDATES Date Topic (effective immediately unless otherwise noted) Page Fannie Mae MCM loans not yet available, two assistance amounts are permitted No origination fee permitted in program, SRP is 2.50% for FHA, USDA:RD, Fannie MCM and 2.00% for VA 6 13

5 ! FANO EXPAND HOMEOWNERSHIP PROGRAM - Administrator Guidelines Page 5 THE FINANCE AUTHORITY OF NEW ORLEANS PROGRAM ORIGINATION TEAM THE FINANCE AUTHORITY OF NEW ORLEANS ( FANO or the Authority ) Creates and sponsors a first mortgage program and a down payment/closing cost assistance program, sets the first mortgage loan rate, term and points, funds the down payment assistance at closing through their Escrow Agent and markets the program. Participating Lenders Take applications, reserve in their own systems, reserve online, process, underwrite, approve, fund, close and sell qualified home mortgage loans to the program. Lenders are responsible for servicing program loans in accordance with Agency requirements until they re purchased by the Master Servicer. US Bank Master Servicer or Servicer Provides information on acceptable loan products and delivery and funding, receives all first mortgage files, reviews first mortgage files, notifies lenders of first mortgage file exceptions, approves first mortgage files, purchases loans, delivers resulting mortgage-backed securities. ehousingplus Program Administration Maintains the program reservation system, website, and posts Administrator Guidelines, forms, training materials, provides program and system training, answers program and system questions, receives compliance files, reviews, posts and notifies of exceptions and approves loan compliance file.

6 FANO EXPAND HOMEOWNERSHIP PROGRAM - Administrator Guidelines Page 6 THE PROGRAM PRODUCTS THE FIRST MORTGAGE PLEASE NOTE THAT RATES AND ASSISTANCE GRANT AMOUNTS ARE SUBJECT TO CHANGE AT ANY TIME. With respect to reserved loans, the mortgage rate and down payment assistance grant amount percentage will not change as long as loans are delivered according to the timetable included in this guide. Reserved loans cannot be cancelled and re-reserved at lower rates. The following mortgage products are offered in this program: FHA, VA, USDA:RD (government loans) and COMING SOON (REV ) Fannie Mae My Community Mortgage loans up to 97% LTV. U.S. Bank provides the specific types of loans permitted (i.e. FHA 203(b), 203(k) streamlined (with U.S. Bank approval), Fannie Mae MCM, etc.). Funds are available in first-come, first-served revolving pools that provide continuous funding. Borrowers receive a 30-year, fixed rate, fully amortizing first mortgage loan with 360 level monthly payments. Income limits apply. ASSISTANCE An assistance grant of 4.00% OR 3.00% (REV ) of the original principal note amount is provided and may be applied toward down payment or closing costs. The assistance amount is tied to the first mortgage rate. Less assistance equals a lower first mortgage rate. Current rates are available online within the system on the FANO ehousingplus page under the Rates tab (not behind security in the lender portal). FANO may add additional grant amounts at any time during the program. The assistance is calculated on the full Note amount. The assistance may be used for down payment or closing costs and prepaids. While there is no cash back in this program, the borrower may be reimbursed for any overpayment of escrow. See page 8 regarding cash back. Because the assistance is a fixed percentage of the original principal amount of the mortgage loan, any remaining assistance must be applied as additional down payment or lastly as a principal reduction. Assistance is in the form of a non-repayable grant. It is not repayable other than for reasons of fraud or similar circumstances. When the first mortgage is reserved in the system, the assistance is automatically reserved. There is no additional reservation necessary. When loans close, there are not second mortgages, second notes, deed restrictions or liens. There is no repayment. The assistance will be funded by FANO s agent Whitney Bank at closing. Lenders request funds at least 2 business days prior to closing. Program Rates and Reservation System Availability Rates and assistance will be posted on the ehousingplus web page by 9:00 am CT Monday-Friday excluding Holidays. New loan reservations are accepted Monday-Friday 9:00 am 4:00 pm CT excluding Holidays. All other functions: underwriter certification, print forms, view pipeline are available 24/7.

7 FANO EXPAND HOMEOWNERSHIP PROGRAM - Administrator Guidelines Page 7 PROGRAM REQUIREMENTS Eligible Borrowers There is no first-time homebuyer requirement in this program. With regard to citizenship requirements, Borrowers must permanently reside in the U.S. Buyers must occupy the property within 60 days of closing. Applicants must be considered irrespective of age, race, color, religion, national origin Minimum FICO Score Buyers must have a minimum FICO credit score of 640 for government loans and Fannie Mae loans up to 95% LTV, 680 for Fannie Mae MCM loans from 95.01% to 97.00% LTV (660 with respect to manufactured housing but not permitted at all for Fannie Mae MCM). The mid score must be the minimum or above. If an Agency (FHA, VA, USDA:RD, Fannie Mae) has a higher minimum, follow Agency guidelines. If a participating lender has a higher minimum for other loans and wishes to require a higher minimum for these loans, then loans must meet a lender s internal higher minimum. Manual underwriting is permitted for Government loans and for Fannie Mae MCM loans at 95.00% LTV and below. Maximum Debt-to-Income (DTI) Ratio The maximum DTI ratio is 45% for all loans in this program. Fannie Mae MCM Loan Level Price Adjustment and Adverse Market Fee Consult U.S. Bank Lending Manual and Training Materials and Fannie Mae MCM information for Adverse Market and LLPA fees. Such fees may be paid by buyer or seller to the extent permissible by Fannie Mae. Homebuyer Education The Authority requires homebuyer education for first-time buyers. Borrower may select any certified non-profit homebuyer education provider from the Louisiana Homebuyer Education Collaborative. See the Homebuyer Counseling Section on for a list of the certified homebuyer organizations. Income Qualifying and Income Limits Use Form 1003 credit qualifying income as the qualifying income in the program. Maximum Income Limit = $82,320 Eligible Loan Area Within the city limits of the City of New Orleans. Purchase Price Limits No purchase price limits at this time. Agency (FHA, Fannie Mae, etc) loan limits apply. Property Requirements New or existing, one - two unit, detached or attached, condos, town homes, manufactured homes that meet Servicer/Agency (FHA, VA, USDA:RD) Guidelines. Only one unit and no manufactured housing for Fannie Mae MCM. Mobile, recreational, seasonal or other types of vacation or non-permanent homes are not permitted. Land may not exceed the size required to maintain basic livability. Properties purchased in the program must be residential units.

8 FANO EXPAND HOMEOWNERSHIP PROGRAM - Administrator Guidelines Page 8 ABOUT THE FINANCING It s expected that lenders have reviewed some preliminary documentation and believe that applicants will also qualify for credit. Excessive cancellations will be reviewed to assure that allocation is not being utilized inappropriately. Unless otherwise indicated, lenders follow Agency (i.e. FHA, Fannie Mae MCM, etc.) guidelines. Added ehousingplus is not responsible for updates to Fannie Mae MCM information or overlays of others. Lenders are advised to check with their underwriters. Fannie Mae Reference Materials Fannie Mae Reference Material links: Fannie Mae Home Page: Eligibility Matrix: MCM Product Matrix: Loan Level Price Adjustment Matrix: IMPORTANT: THERE ARE LLPA AND ADVERSE MARKET FEES THAT APPLY TO FANNIE MAE MCM LOANS. Follow MCM guidelines for all MCM loans in this program. None of those fees are waived in this program. Only one unit properties permitted Ownership of other property is not permitted. All loans are subject to a DU Approval. Only Approve/Eligible findings are permitted, no exceptions. Revised For all Conventional Loans with LTVs of 95% or less All Lenders should follow the normal USBHM HFA Division and HFA underwriting guidelines for credit overlays, etc. For all Conventional Loans with LTVs 95.01%-97% This Conventional product requires special Delegated Lender underwriting authority from USBHM HFA Division. If you have not been notified by USBHM HFA Division that you have such authority you MUST submit any conventional loan with an LTV of 95.01% to 97% to USBHM HFA Division Underwriting Department for underwriting. Please ensure you are following all US Bank Credit Overlays, Submission & Loan Registration procedures for 95.01% - 97% LTV loans. Click on this link: MRBP Division Click on US Bank Lending Manuals Pop-up box will appear, click on Continue Web Page will be redirected to US Bank All Regs site. Click on the Underwriting folder Click on the Guidelines folder Click on the LTV 95.01% - 97% page

9 FANO EXPAND HOMEOWNERSHIP PROGRAM - Administrator Guidelines Page 9 Added For all loan types unless otherwise indicated or not allowed by Agency (FHA, Fannie Mae) Appraisal The appraisal must indicate that the home has at least a 30-year remaining useful life. Assumptions Follow Agency Guidelines. Buydowns Follow Agency Guidelines. Cash Back Cash Back to the borrower is not permitted. However, borrowers are permitted a reimbursement of pre-paids and overage of earnest money deposit as permitted by Agency guidelines and to the extent any minimum contribution, if any, has been satisfied. Construction to Perm Not permitted. Co-signers Co-signers are not permitted in this program. Minimum Borrower Contribution Government loans, no minimum down payment required from the Borrower s own funds. Mae MCM may be subject to a minimum based on Mortgage Insurer guidelines. Fannie Minimum Loan Amount There is no minimum loan amount in this program. Prepayments The first mortgage may be prepaid at any time without penalty. Recapture Tax There is NO RECAPTURE TAX IN THIS PROGRAM. Refinances Refinances are not permitted in this program. However, temporary, bridge or construction loans with a term of 2 years or less may be taken out with a program loan. Seller Contributions Follow Agency (FHA, Fannie Mae, etc.) guidelines.

10 FANO EXPAND HOMEOWNERSHIP PROGRAM - Administrator Guidelines Page 10 THE PROCESS SUMMARY TRAIN Lender training provided by the administrator -- See TRAINING tab located on the ehousingplus web page for the FANO program. For program information and program and system training -- ehp University is offered 24/7. LENDER PORTAL USER CREDENTIALS Following ehp University training and with instructions received in the sent the next business day following successful completion of training, Lenders apply for User Credentials on the ehousingplus website. Credentials should be received within 48 hours. QUALIFY Lenders qualify applicants for the program. Buyers must present an executed sales agreement before being entered into the program reservation system. RESERVE To reserve funds in program s online system click on this link. Log in and reserve the first mortgage that automatically provides Assistance. You will receive a loan number and a message that you ve completed the reservation successfully. PROCESS Lenders process the loan as they would normally keeping in mind the (15 / 70-day) program timelines. UNDERWRITE AND CERTIFY Lenders underwrite & are responsible for credit decisions of the loans in the program. Servicer does not re-underwrite loans. Following credit approval AND WITHIN 15 DAYS OF LOAN RESERVATION, Underwriter completes the online underwriter certification screen located behind security in the lender portal. Once completed the system is locked. Contact the ehousingplus Compliance Office regarding any necessary changes. PROGRAM CLOSING FORMS Following submission and acceptance of the underwriter certification, view loan forms located on the FANO page. Print and review to assure that all blanks are correct and completed. Those blanks not completed by auto-fill, are interactive and lender may add the information. CLOSE Lender closes loan. Notice of Down Payment/Closing Cost Assistance Grant Letter is signed at closing and retained by lender with copies to borrowers, FHA Case Binder and U.S. Bank.. SHIP / SUBMIT Use the compliance checklist to assemble the compliance file. The compliance file is submitted directly to ehousingplus per instructions on form. The first mortgage file and credit package are submitted to U.S. Bank. U.S. Bank mortgage file delivery checklists are on their website. EXCEPTIONS Lenders are notified by ehousingplus and U.S. Bank of exceptions. Exceptions for both ehousingplus and U.S. Bank are available in the ehousingplus web-based system. FINAL DOCUMENTS The recorded mortgage documents should be sent to U.S. Bank.

11 FANO EXPAND HOMEOWNERSHIP PROGRAM - Administrator Guidelines Page 11 PROCESS GUIDELINES FOR REQUESTING DOWN PAYMENT ASSISTANCE FUNDS DPA funds MUST be provided directly to the Closing Agent by FANO. advance these funds. These requirements apply to all loan types. Lenders may not Lender reserves first mortgage. This automatically reserves GRANT. Lender processes normally. Once the loan has been granted final approval internally, the Lender s Underwriter will complete the online Underwriter s Certification. With a minimum 2 business day notice prior to the Loan Closing Date, completed form should be ed to Carolyn Simmons at csimmons@financeauthority.org AND the following addresses: carliss.knesel@whitneybank.com; angela.fyssas-lear@whitneybank.com; erick.ranta@whitneybank.com. Direct office telephone number for FANO is Please make sure that the internal Processor/Closer and Title Company/Closing Agent receive instructions indicating that the HUD-1 Settlement Statement should reflect the grant as follows: Finance Authority of New Orleans Grant. Added Please remember that ALL funds must be used in the transaction. Additional down payment is a preferred use of funds not needed for other closing costs.

12 FANO EXPAND HOMEOWNERSHIP PROGRAM - Administrator Guidelines Page 12 PROGRAM TIMETABLE 15 and 70-DAY DEADLINES Buyers MUST HAVE A FULLY- EXECUTED SALES CONTRACT FOR A SPECIFIC PROPERTY in order to have funds reserved or be on a waiting list. The contract may be dated prior to the date of the loan application. Buyers may be pre-qualified. However, if the buyer does not have a contract on a property, program funds cannot be reserved for the buyer until such time as the buyer presents a valid contract. To assure that loans are purchased, please follow the Processing, Delivery and Purchase Timetable below. Please DO NOT reserve loans that cannot meet the timetable. If the loan is not underwriter certified within 15 days of loan reservation, the loan is subject to cancellation. ehousingplus via notifies lenders that the loan may be canceled if the underwriter certification is not completed. Should the loan reservation be canceled at any point during the reservation, the issuer may allow the loan to be reinstated at the higher of the mortgage rate originally reserved or the then current program mortgage rate. Please wait until 45 days before closing to reserve funds for new construction, short sales and foreclosures. Loans not purchased within the timeframe below cannot be purchased. However, please keep in mind that the revolving pool of funds assures continuous funding fund availability makes it unnecessary to rush to reserve funds. Loan Processing, Delivery and Purchase Timetable Once a loan is reserved in the ehousingplus system and is provided the Servicer s Loan number, the loan must be (1) underwriter certified within 15 days of loan reservation, and (2) purchased within 70 days of loan reservation. Extension Request Any loan not purchased within 70 days is ineligible for purchase unless the lender chooses a onetime only 30-day extension. The cost of the extension is $375. The $375 extension fee is due whether or not loans are ultimately delivered and/or purchased. The $375 will be netted by the Servicer when loans are purchased. If an extension is permitted, but the loan is not purchased, the originating lender will be billed for the extension fee of $375. Any outstanding fees owed by the lender may result in that Lender becoming ineligible to participate in the program. At 101 days, a loan that hasn t been purchased is cancelled and cannot be reinstated. Again, the 30-day extension is offered once per loan and no further extensions will be allowed. Furthermore, regardless of choosing an extension, any loan not purchased within the approved timeframe will become the liability of the originating lender. An extension request is available on the EBRMFA ehousingplus web page. Click on the SUMMARY tab, scroll to the area titled, Extensions. Remember that the form must be submitted BEFORE the 70th day after loan reservation.

13 FANO EXPAND HOMEOWNERSHIP PROGRAM - Administrator Guidelines Page 13 PROGRAM FEES First Mortgage Fees No origination or discount fees allowed in this program. Rev The program includes a compliance fee of $250. The fee is payable at closing and remitted to ehousingplus with the compliance file. The fee must be disclosed on the HUD-1 as being paid to ehousingplus and can t be financed. There is also a lender fee of $100 per file for chronically deficient files. US Bank fees of $85 Tax Service Fee and $300 Funding Fee are payable at closing. Both must be disclosed on the HUD-1 as being paid to U.S. Bank. They will be netted at loan purchase and can t be financed. Lenders are permitted to charge reasonable and customary charges for out of pocket expenses and costs. Other financing costs such as legal fees and underwriting fees may be charged and courier fees may be charged if such fees are normally charged. Lenders may charge the usual and reasonable settlement costs. Settlement costs include titling and transfer costs, title insurance, survey fees or other similar costs. Other allowable fees include doc prep fees, notary fees, hazard, mortgage and life insurance premiums, recording or registration charges, prepaid escrow deposits and other similar charges allowable by the insurer/guarantor. "Junk" fees are not a defined term and may not be charged. Excessive fees are not permitted in the program. Lender Compensation On each loan the lender receives 2.50% SRP for FHA, USDA:RD and Fannie Mae MCM loans and 2.00% SRP for VA loans paid by U.S. Bank at loan purchase. Rev Loan Type SRP Total FHA 2.50% 2.50% USDA:RD 2.50% 2.50% Fannie Mae 2.50% 2.50% MCM 97 VA 2.00% 2.00%

14 FANO EXPAND HOMEOWNERSHIP PROGRAM - Administrator Guidelines Page 14 PROGRAM FORMS PRE-CLOSING Extension Request Form An extension request is available here. Click on the SUMMARY tab and scroll down to the area titled - PROGRAM DOCUMENTS. The extension request will be completed and submitted online. CLOSING DOCUMENT There is a Notice of Down Payment/Closing Cost Assistance Grant Letter that meets the requirements of FHA Mortgagee Letter The letter is available on the secure website and auto-fills for printing ready for borrower signature. Original remains with lender, copies to borrower, U.S. Bank (follow most recent bulletin) and the FHA case binder. DOCUMENTS REQUIRED FOR COMPLIANCE FILE Compliance File Checklist Available online behind security. Copies of the following: Real Estate Purchase Agreement Complete Agreement including any addenda. All signed and dated by all parties. Final Typed Loan Application (Form 1003) The typed application signed and dated by all parties is required. Loan interviewer must complete and sign page 3 of 4 of the If this is not possible, then an Officer must sign in place of the interviewer. HUD-1 Settlement Statement Buyer, seller and closing agent must fully execute the HUD-1. Borrowers on the HUD-1 must be all persons taking title to the property and match other documents. Persons not taking title to the property may not be named or sign the HUD-1. The TBA application fee must be shown as being payable to ehousingplus and US Bank fees must be disclosed as being paid to U.S. Bank. Please do not bundle charges. Itemize all charges to the transaction. Payoffs of other debt must appear on Page 1 under Section 100 of the HUD-1 as part of "Settlement Costs". Warranty Deed A copy of the Warranty Deed is required. Homebuyer Education Certificate (copy) A copy of the homebuyer education certificate must be in the compliance file. All primary borrowers on the note who are first-time buyers must attend homebuyer education. (Co-signers do not need homebuyer education). FANO requires specific Homebuyer Education providers. Please see Page 7 of this Guide for more information.

15 FANO EXPAND HOMEOWNERSHIP PROGRAM - Administrator Guidelines Page 15 U.S. BANK WEBSITE Down Payment Assistance Funding Verification Form - USB002 U.S. Bank checklists, program manuals, bulletins, lender training All may be found on the US Bank ALL Regs web site. Click on this link: Click on US Bank Lending Manuals Pop-up box will appear, click on Continue Web page will be redirected to U.S. Bank All Regs site. Click on Housing Finance Authority folder Click Louisiana Click Finance Authority of New Orleans Select information of interest