Underwriting Guideline Matrix

Transcription

1 NewLeaf HomeReady Fixed Program / Product Codes: HomeReady 30 Year Fixed (W161) HomeReady 30 Year Fixed LPMI (W162) Subject to Change Without Notice Valid as of 08/01/2016 Copyright 2016 Skyline Financial Corp. dba Skyline Home Loans, Nationwide Mortgage Licensing System (NMLS) Company ID# Arizona Mortgage Banker License #927740, Licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act File No: , Georgia Residential Mortgage Licensee, Oregon Mortgage Lender License ML 2797, South Carolina Mortgage Lender / Servicer License MLS#12072, Washington Consumer Loan Company License CL Refer to and input NMLS#12072 to see where Skyline Financial Corp. is a licensed lender. View full NewLeaf Wholesale footprint here.

2 NewLeaf HomeReady Fixed HomeReady is a conventional program designed for creditworthy low-to-moderate income borrowers, with expanded eligibility for financing homes in designated low- to-moderate communities. Refer to fanniemae.com for guidelines not addressed in this matrix. Mortgage insurance providers may have additional restrictions not listed within this document. Please refer to each mortgage insurance company's website for complete eligibility details. Owner Occupied: Purchase and Rate/Term Refinance Transaction Parameters # Units Maximum Loan Amount Hawaii Properties With or Without Sub. Financing* Min FICO 1 417, ,500 97%/97%* 2 533, , ,950 1,202,925 85%/85% 75%/75% ,950 1,202,925 75%/75% CLTV up to 105% is permitted with a Community Second. *See > 95% LT section for requirements Minimum Loan Amount General Guidelines For guidelines not referenced in this matrix, refer to the NewLeaf 2 standard Conforming guidelines $75,000 Maximum Loan Amount >95% LTV Requirements Agency Conforming loan limits Maximum 97%/97% with subordinate financing that is not a Community Second Maximum 97%/105% with subordinate financing that is a Community Second Purchase Transactions only 1 Unit SFR, PUDs & Condos Homebuyer education is required Borrower is not required to be a First Time Homebuyer Manufactured Homes are not allowed See MI section for requirements Product Terms 30 year Fixed Page 1 of 5 Last Updated

3 Property Types Eligible: SFR, 2-4 Units, Condo, PUD, Manufacture Homes Ineligible: Non-Warrantable Condos, Hotel/Resort Projects, Manufactured Homes > 95% LTV, Co-ops, Farms & Ranches, Dome Homes, Earth Homes, Timeshares, Condo Hotels, Log Homes or other unique properties. Maximum size of acreage is 20. Refer to max acreage section for more details. Income producing properties are ineligible. 3-4 unit properties are ineligible for Community Solutions For all condo eligibility requirements refer to NewLeaf Condo checklist Eligible States AZ, CA, CO, FL, GA, HI, ID, MD, NE, NM, OR, SC, TN, TX, UT, WA Borrower Income Limits First Time Homebuyer Property Ownership No income limits in low-income census tracts 100% of area median income (AMI) in high-minority census tracts or designated disaster areas 80% of area median income (AMI) in all other census tracts Link to Fannie Mae Area Median Income (AMI): Census tract look up tool: No requirement for the borrower to be a First Time Homebuyer The property must be owner-occupied and the borrower may not have an ownership interest in any other residential dwelling at the time of loan closing. Qualifying Rate Note Rate Qualifying Ratios Determined by DU Reserves Determined by DU DU: Approve/Eligible required Manual Underwriting: Not permitted Underwriting Method Mortgage Insurance Minimum Borrower Contribution Non-Occupant Borrowers Note: Based on the census tract and borrower income, DU will notify users when a loan casefile appears to be eligible for HomeReady if the loan is not underwritten as a HomeReady loan. Resubmit the loan as a HomeReady to obtain the appropriate HomeReady messaging. New Additional screen field will allow entering census tract information if DU is unable to geocode the property address. Eligible in DU if at least one borrower has traditional credit and can contribute more than 50% of the qualifying income. >90% LTV to 97% - 25% Standard MI for LTVs <= 90% MI may be financed up to the maximum LTV 1 unit None 2-4 units 3% Non-Occupant borrowers permitted to maximum 95% LTV Blended ratios are acceptable Income is considered as qualifying income and subject to the income limitations No limitation on ownership of other property for non-occupant borrowers Eligible in DU if at least one borrower has traditional credit and can contribute more than 50% of the qualifying income Page 2 of 5 Last Updated

4 Homebuyer Special Borrower Considerations for Homebuyer Post purchase Homebuyer Landlord Other Income Homeownership education is required prior to note date for at least one borrower on all transactions (purchase and rate/term refinances). o Must be provided through Framework an online program approved by Fannie Mae. o $75 fee paid by the borrower to Framework for a simple, accessible online program with support 7 days a week (this fee may be paid through interested party contribution) o Homeownership education certificate must be retained in the mortgage file. o Although one-on-one counseling is optional for HomeReady, Framework will offer borrowers a referral to a HUD-approved counseling agency for additional assistance. Borrowers also have the option to consult a counselor of their choice. In lieu of the Framework course that is required above, a certificate of pre-purchase education/counseling is acceptable from a HUD-approved counseling agency. Must be dated within the previous six months before the loan application date and before September 30, 2016 Online education may not be appropriate for all potential borrowers. The presence of a disability, lack of Internet access, and other issues may indicate that a borrower is better served through other education modes (ie. In person, classroom education, telephone conference call, etc.). In these situations, borrowers should be directed to Framework s toll free customer service number, from which they can be directed to a HUD approved counseling agency that can meet their needs. The counseling agency that handles the referral must provide a certificate of completion, and a copy of the certificate must be in the file To support sustainability, borrowers will have access to post-purchase homeownership support for the life of the loan through Framework s homeownership advisor service. Required for 2-4 unit properties 1 Unit properties: o Boarder income (relatives or non-relatives): Up to 30% of qualifying income Documentation of at least 9 of the most recent 12 months is required (averaged over 12 months) and documentation of shared residency of the past 12 months is required o Rental income from Accessory Dwelling units may be considered in qualifying the borrower per rental income guidelines Non-Borrower Household income Acceptable Sources of Funds for Down Payment and Closing Costs Mortgage Insurance 2-4 Unit properties: o Rental income may be used as qualifying income per rental income guidelines Permitted as a compensating factor to allow a DTI ratio > 45% up to 50% (non-borrower income is not considered qualifying income and is not applied to income limits). The following additional requirements apply: o Non-borrower income must total at least 30% of the total monthly qualifying income being used by the borrower (s) (Note: income from more than one non-borrower household member may be considered) o Non-borrower household members may be relatives or non-relatives o Non-borrower household income must be documented in accordance with standard guidelines based on the income type o Non-borrowers must sign a statement of intent to reside with the borrower for a minimum of 12 o months The income must be reflected in DU as an Other Income type of Non-Borrower Household Income This income will not be included as qualifying income, and would not impact the DTI ratio used in the risk assessment or displayed on the DU findings Gifts Grants Community Seconds Cash-on-hand for 1 unit properties only Any eligible loan may have more than one Community Seconds up to the maximum 105% CLTV >90% LTV to 97% - 25% Standard MI for LTVs <= 90% MI may be financed up to the maximum LTV Page 3 of 5 Last Updated

5 Approved MI Companies Mortgage Insurance Types Community Seconds ARCH Essent Genworth MGIC Radian UGI Single Premium Financed MI is permitted for purchase / rate & term, owner occupied or 2nd home, 1- unit properties only AND MI premium is included in maximum LTV permitted for program. Must be paid through closing and evidenced on the HUD-1 Single Premium MI permitted, may be paid by Borrower, seller or with premium pricing. (If paid by seller, must be within maximum allowable seller contributions). Must be paid through closing and evidenced on the HUD-1 Monthly MI permitted Split Premium allowed. Lender Paid MI permitted (MGIC to be ordered by NewLeaf Underwriter) Lender Paid MI allowed up to 95% LTV Custom or Reduced MI is not permitted. The specific terms and structure for Community Seconds programs may vary depending on the provider NewLeaf Underwriter is responsible for reviewing the Community Seconds that are used in those transactions that are combined with a My Community 1 st lien mortgage The Community Seconds Checklist must be used to evaluate key considerations in determine where to grant approval of a Community Second program The Community seconds mortgage may be funded by a municipality, state, county, state or local housing finance agency, nonprofit organization or an employer assistance program. If may not be funded by the property seller or any other interested party to the transaction The funds received from a Community Seconds mortgage may be used to fund all or part of the down payment or closing costs, renovations to the property, or to fund a permanent interest rate buydown. If the Community Seconds program includes deed restrictions or local ordinances that impose similar restrictions, these restrictions and agreements must comply with Fannie Mae policies. Please refer to Fanniemae.com for details NewLeaf Underwriter must determine that the deed of trust or mortgage for the Community Seconds mortgage is clearly subordinate to the first mortgage lien and the title insurance in effect must ensure priority of the first mortgage being delivered to Fannie Mae by showing the Community Seconds mortgage in a subordinate position The Community Seconds documents do not need to explicitly state the fact that the Community mortgage will be subordinate to the first mortgage; however, the documentation must allow the holder of the first mortgage to foreclosure an acquire title to the property free and clear of all interest of the Community Seconds provider. The Community Seconds mortgage may not provide for negative amortization. However, because negative amortization will occur if the interest rate is > 0% and the payment of interest is deferred for a period of time, negative amortization will otherwise be acceptable as long as: o Interest is accrued on a simple-interest basis at a rate that is not more than 75% of the rate of the related first lien loan, and the accrued interest is fully deferred until sale or transfer of the property, the mortgage loan is refinanced or other full repayment of the first lien loan, or declaration of an event of default under the subordinate note or the security instruction, or the accrued interest is assessed only as a penalty upon declaration of an event of default under the subordinate note or the security instrument. Minimum Borrower Contribution Requirements: o For LTVs up to 80% - A minimum borrower contribution from the borrower s own funds is not required. All funds needed to complete the transaction can come from a Community Second o For > 80% - 1 unit Principal Residence A minimum borrower contribution from the borrower s own funds is not required. All funds needed to complete the transaction can come from a Community Second o LTVs > 80% unit Principal Residence The borrower must make a 5% minimum contribution from his/her own funds. After the minimum borrower contribution has been met, a Community Seconds can be used to supplement the down payment and closing costs. Refer to Fanniemae.com (B5-5.1) for complete Community Seconds Guidelines Page 4 of 5 Last Updated

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