VA CASH-OUT & RATE/TERM REFINANCE

Transcription

1 Table f Cntents 1. Eligible Mrtgage Prduct & Term Maximum Lan Amunt/LTV VA Lan Limits Entitlement/Guaranty Funding Fee Table Eligible Mrtgage Prduct-New Lan Discunt Pints FICO High Cst/High Priced DTI Ratis DTI Ratis Cntinued Brrwer Eligiblity Same-Sex Married Cuples Prperty Requirements Other Real Estate Appraisal Requirements Credit Requirements Incme Requirements Assets Dcumentatin Requirements Underwriting Methd VA Allwable Fees VA Nn-Allwable Fees LDP/GSA CAIVRS Demand Title Useful Link VA Cash-Out Refinance

2 Eligible Mrtgage Prduct & Term Maximum Lan Amunt/LTV VA Cash-Out Refinance 30 Year Fixed Rate 5/1 ARM Margin 2.25% Cash Out Limited t 90% including the VA Funding Fee Rate/Term Limited t 100% excluding the VA Funding Fee Current cmbined utstanding principle balances, clsing csts, discunt pints, VAFF and cash-ut >$500 up t 90% LTV/CLTV Current cmbined utstanding principle balance, clsing csts, discunt pints, VAFF and cash-ut <=$500 up t 100% LTV/CLTV VA Lan Limits UNITS LIMITS INCLUDE VA FUNDING FEE 1-4 Units $417, Units $417,001 - $699, Units * $700,000 - $1,000, Units * $1,000,001 - $1,500,000 Lan amunts $700,000 and abve require exceptin frm investr prir t dcs VA Cunty Limits * High Balance VA lans: DTI <= 41% > $700,000 & <= $1,500,000 maybe eligible, subject t Crprate Underwriting Apprval INVESTOR FORM 19 NO LONGER REQUIRED * VA Lans > $700,000 & </= $1,500,000 may be eligible subject t Exceptin frm investr when DTI > 41%. Underwriter t cmplete Investr Specific Frm 19 and fax t with required dcumentatin. Underwriter t add cnditin Investr Specific t WFB nce Investr Exceptin has been granted. LOAN AMOUNT ENTITLEMENT/GUARANTY MAXIMUM POTENTIAL GUARANTY < = $45,000 50% f the lan amunt $45,001 t $56,250 $22,500 $56,251 t $144,000 40% f the lan amunt r maximum $36,000 $144,001 t $417,000 25% f the lan amunt r maximum $104,250 $417,001 t $1,500,000 25% f the lan amunt r maximum $273,656 Calculating the max lan amunt- PBM Maximum Lan Wrksheet is required t be used t validate 25% guarantee has been met. VA Cash-Out Refinance

3 Entitlement/Guaranty Prcessed Certificate f Eligibility t certify current lan is active VA Lan f recrd Guaranty is Autmatic Exempt/Nn Exempt Status FUNDING FEE TABLE First Time Use 10% r mre Equity Rate Subsequent Use 10% r mre Equity Rate Regular Service 2.15% Regular Service 3.3% Reservist/Nat l Guard 2.40% Reservist/Nat l Guard 3.3% All VA Lans require a VA Funding Fee. Exceptins may be made t veterans with service-cnnected disabilities and t surviving spuses f veterans wh die in service r frm service cnnected disabilities. Funding Fee must be financed r paid with cash in full in cash at clsing. N partial payments allwed. Lan Amunt > $417,000 If the cmbined lan amunt plus funding fee exceeds the cunty limit, then a dwn payment fr guarantee shrtfall per VA Maximum lan wrksheet will be required. Eligible Mrtgage Prduct-Existing lan Eligible Mrtgage Prduct- New Lan Discunt Pints Limited t 2% VA t VA Refinance Cnventinal t VA FHA t VA NOTE: NO CASH OUT allwed n prperties that are Free & Clear. NOTE: Refinance frm a Private Nte t a VA Lan is nt allwed Fixed Rate 30 Year Fic FICO fr lan amunts >700k t < $999, FICO fr lan amunts > $1,000,000 t $1,500,000 High Cst/High Nt allwed Priced DTI Ratis DU/LP up t 50% (DU must be run 1 st LP is nly allwed with Crprate Apprval) DU/LP > 50% requires Crprate 2 nd Signature & (3) VA Cmpensating Factrs. Table f Residual Incme by Regin Fr lan amunts f $79,999 and belw Family size Nrtheast Midwest Suth West 1 $390 $382 $382 $425 2 $654 $641 $641 $713 3 $788 $772 $772 $859 4 $888 $868 $868 $967 5 $921 $902 $902 $1004 Over 5 Add $75 fr each additinal member up t a family f 7 VA Cash-Out Refinance

4 DTI Rati s Cntinued Brrwer Eligibility Fr Lan Amunts f $80,000 and abve Family Size Nrtheast Midwest Suth West 1 $450 $441 $441 $491 2 $755 $738 $738 $823 3 $909 $899 $899 $990 4 $1,025 $1,003 $1,003 $1,117 5 $1,062 $1,039 $1,039 $1,158 Over 5 Add $80 fr each additinal member up t a family f 7 Nte: Fr lan applicatins in which either the brrwer r the spuse is an active-duty service persn, the residual incme figures abve may be reduced by 5 percent, if there is a clear indicatin that the brrwer r spuse will cntinue t receive the benefits resulting frm the use f nearby military-based facilities. This reductin may als be applied t retired military applicants when the prperty is lcated reasnably near a military base r installatin. (This reductin applies t bth f the abve tables). Brrwer(s) must have been bligated n the riginal VA Lan. Change in Mrtgagrs are nly permitted with the prper dcumentatin in fllwing cases: EXISTING VA LOAN NEW LOAN Unmarried Vet Veteran and New Spuse Vet and Spuse Divrced Veteran nly (Cpy f 6 m cancelled checks) Vet and Spuse Veteran and New Spuse Veteran alne Different veteran wh has substituted entitlement Veteran and spuse Veteran Widw/Widwer 1 time Purchase. Veteran and nn-veteran n title nly Same (primary resident nly) Veteran and Veteran single eligibility * see ntes lcated in Underwriting Methd sectin Veteran and veteran with dual eligibility * see ntes lcated in Underwriting Methd sectin US Citizens Permanent & Nn-Permanent Resident Aliens Same-Sex Married Cuples Lender Prcessing: Same-sex married cuples when executing the 1003 and 1802a acknwledge that they meet the fllwing VA requirements: The marriage was legal in the place where the Veteran r the Veteran s spuse resided at the time f the marriage; Legal in the place where the Veteran r the Veteran s spuse resided at the time the cmpleted 1003 and 1802a were submitted t PBM; VA Cash-Out Refinance

5 Legal in the place where the Veteran r the Veteran s spuse resided in at the time f clsing; If the brrwer asserts a spusal relatinship in item 19 (1802a) and signs the frm, which includes a certificatin by the brrwer that the infrmatin is true and cmplete t the best f their knwledge and belief, PBM may prcess the lan per nrmal practices withut submitting a lan package t VA fr apprval f spusal status: If the brrwer infrms the lender that he r she is uncertain as t whether the marriage may be recgnized fr VA purpses, the underwriter must request that VA make a determinatin regarding whether the marriage can be recgnized, The fllwing infrmatin shuld be prvided t Phenix Reginal Lan Center via at: LPGC.VBAPHO@va.gv fr further review: Date and state f marriage; State(s) f residence f the parties at the time f marriage; State where the subject prperty is lcated; Current state(s) f residence f the parties; Estimated date f lan clsing; and Whether VA has previusly recgnized the marriage fr the purpse f a different VA benefit r service. The underwriter shuld request this infrmatin frm the brrwer if nt already available. Prperty Requirements Single Family Residence PUD Cnd (VA apprved) 2-4 Units (per guideline requirements) Owner Occupied Primary Residence nly 2-4 units nt available fr lan amunts ver > $417k Other Real Estate Maximum number f financed prperties is fur (4) Including PBM Lan Appraisal Requirements LAPP Appraisal (VA Appraisal ONLY) NOV (Ntice f Value) is valid fr 6 mnths and FHMA frm 1004MC is required fr all appraisals UAD Cmpliant (Unifrm Appraisal Dataset) Interir phts t include: kitchen, bathrm, main living area, physical deteriratin if present, restratin, remdeling r renvatin if present. Exterir phts t include: frnt and rear view, street scene, site features, imprvements and views that wuld affect value. Small Residential Incme Prperty Appraisal Reprt, Freddie Mac Frm 72, Fannie Mae Frm 1025, if prperty has tw t fur living units All lans must adhere t State and Lcal Prperty Laws (carbn mnxide, smke detectrs and lead based paint guidelines) If the appraiser ntes the absence f a wrking carbn mnxide detectr and appraisal is Subject T - A 1004D will be required evidencing the cmpletin f the requirements. VA Cash-Out Refinance

6 If the appraiser ntes the absence f a wrking carbn mnxide detectr, but appraisal reads, AS IS a 1004D will be required as this is a health and safety issue. If the appraiser des nt mentin the absence f a wrking carbn mnxide detectr in the appraisal reprt, neither a 1004D nr a Lender s Certificatin evidencing cmpletin will be required in regards t the carbn mnxide detectr. Fr lan amunts > 1,000,000, be sure t request a certified appraiser when requesting the appraiser assignment frm VA. Regardless f lan amunt, the VA guaranty plus cash/equity must be equal t at least 25% f the purchase price r Ntificatin f Value (NOV), whichever is less, n purchases and nn-irrrl refinances. Credit Requirements Unpermitted Prperty Additins: Prperties with unpermitted structural additins are allwed under the fllwing cnditins: The quality f the wrk is described in the appraisal and deemed acceptable (wrkmanlike quality) by the appraiser; The additin des nt result in a change in the number f units cmprising the subject prperty(e.g. a 1 unit cnverted int a 2 unit) If the appraiser gives the unpermitted additin value, the appraiser must be able t demnstrate market acceptance by the use f cmparable sales with similar additins and state the fllwing in the appraisal: Nn-Permitted additins are typical fr the market area and a typical buyer wuld cnsider the unpermitted additinal square ftage t be part f the verall square ftage f the prperty. The appraiser has n reasn t believe the additin wuld nt pass inspectin fr a permit. 3 merge credit reprt required All brrwers must have a valid Scial Security Number All brrwers must have at least (2) valid credit scres. Nn-Traditinal Credit is NOT allwed Judgment s: All judgments must be paid in full r subject t a repayment plan with a histry f timely payments. 2 Years elapsed since the discharge f Chapter 7, Chapter 13 Bankruptcy r Deed in Lieu/Shrt sale when the brrwer was nt delinquent at transfer. Chapter 13 discharged <2 years required Crprate Exceptin AND paid as agreed status frm chapter 13 Trustee fr current term, nt less than 12 mnths. 3 years elapsed since cmpletin f Freclsure, Deed in Lieu/Shrt Sale when the brrwer was delinquent at time f transfer. All judgments must be paid in full r subject t repayment plan with a histry f timely payments. VA Cash-Out Refinance

7 Nte: In a case where the brrwer(s) has less than 3 years, but ver 2, an exceptin is required. Branch must the infrmatin belw with the PBM Lan Exceptin Frm dated t PBM Lan Exceptin Request, VA Lan Analysis/1003 DU/LP Apprval Credit Appraisal And any ther dcumentatin assciated with the exceptin request. NOTE: Initial Applicatin date can t be until after the required time frame has elapsed & AUS findings must be an Apprve/Eligible. Disputed accunts Examples Letter f explanatin fr disputed accunt plus cpy f dcumentatin t validate reasn fr dispute (i.e. LOE and cpy f plice reprt if reasn was stlen wallet r purse ) Utilities nt paid Letter f explanatin and prf nt residing at residence at the time f issue. Late payment dispute- Letter f explanatin and prf the accunt was paid n time. High Balance N Freclsure r Bankruptcy in the last 7 years. N husing payment 30 days r mre past due in the last 12 mnths Student lans Student lans If student lan repayments are scheduled t begin within 12 mnths f the date f VA lan clsing, the underwriter shuld cnsider the anticipated mnthly bligatin in the lan analysis. If the brrwer is able t prvide evidence that the debt may be deferred fr at least 12 mnths frm the date f the nte, the debt need nt be cnsidered in the analysis. If the student lan payment is nt reflected n the credit reprt, the underwriter shuld btain evidence t dcument the mnthly payment. Incme DU/LP requirements must be met Requirements Verbal Verificatin f Emplyment (VVOE) within 10 days f Nte 2-4 Units: The amunt f effective rental incme is based n 75% f: Verified prir rent cllected n the units r The appraisers bservatin f prperties fair mnthly rental incme Veteran(s) that are purchasing a 2-4 unit subject prperty must indicate the reasnable likelihd f success as a landlrd NOTE: Fr infrmatin n Incme, please refer t VA Guide Chapter (4) Incme Tax Return Transcripts Lans clsed n r after June 15, 2015 must include the 2014 Tax Return Transcripts t be eligible fr purchase. If a brrwer has filed an extensin, we require: Evidence in the file that the extensin was filed, and VA Cash-Out Refinance

8 A 2014 Tax Transcript shwing N recrd f return filed Assets Dcumentatin Requirements Underwriting Methd Nte: Lans that d nt require incme (nn-credit qualifying FHA Streamlines and VA IRRRLs) are exempt. DU/LP requirements must be met Reserves required fr the fllwing: Lan amunts $417,001 t 699,999 = 2 mnths Lan amunts $700,000 t 1,500,000 = 3 mnths 2-4 units = 6 mnths reserves Gift funds can be used t pay ff credit cards t qualify Gift funds can be used t pay fr the termite cmpletin wrk IRS 4506-T must be cmpleted and dated at applicatin and again at clsing fr all brrwers. IRS prcessed transcripts fr time perids cvered must be validated prir t clsing. If an exceptin fr the use f W-2 s nly has been apprved by Crprate then IRS transcripts fr W-2 s Only will be required. Alive and Well Statement signed by veteran and/r Cmmanding fficer (if veteran is deplyed) dated prir t Nte date Pwer f Attrney allwed: Must be specific & veteran must execute the initial r final 1003 with a live signature Fully executed letter f explanatin regarding the purpse f cash-ut prceeds Termite Reprt & Clearance signed by brrwer(s) A statement frm the brrwers disclsing the purpse fr the cash ut is required. Fllw DU/LP findings- Fic scres must be met regardless f DU/LP findings. Manual underwriting nly fr DU/LP apprvals dwn graded by underwriter as lng as all f the fllwing are met; 700 FICO Scre 0x30x12 Mrtgage histry, Management VOR r Cancelled checks Maximum 45% DTI, and Lan must cmply with all VA requirements fr manual underwriting. Cntact Secndary fr lender specific apprval, and In the Nte sectin f Empwer be sure t nte lan is a manual underwrite & the reasn why, and Include this infrmatin n the Lan Analysis. Fully executed Max Lan Wrksheet t be cmpleted by Underwriter *Cash-Out Lans issued t 2 veterans with single r dual eligibility (50/50) require VA t underwrite and apprve the lan. (Excludes a husband and wife with dual eligibility when nly ne spuse s eligibility is being used t qualify.) VA Cash-Out Refinance

9 VA Allwable Fees VA Nn-Allwable Fees Once the lan has been cmpletely prcessed and underwritten at the branch, the file needs t cme t Crprate Office fr review by Crprate Gvt. Underwriter. Once a Crprate Underwriter has reviewed the file fr cmpleteness, the file will be sent t VA fr apprval. Turn times fr VA will depend n VA s current wrk lad. 1802A and 1003 must be prcessed as fllws: Initial 1003 & pages 1 & 2 nly f the 1802A must be executed prir t lan dcuments. The 1003 page 3 and Page 1 f the 1802A must be signed by the lan fficer. Final 1003 & pages 1 & 2 nly f the 1802A must be executed at clsing. Pages 1 f the 1802A are t be executed by PBM VA Apprved Underwriter with final lan apprval date. VA Statement f Itemizatin t HUD 1 (lcated in Frms) VA Allwable Fees Appraisal Recrding f Deed f Trust Credit Reprts Prepaids Hazard Ins. Fld Zne Determinatin Termite Fees r wrk cmpleted Title Plicies VAFF Additinal third party fees that the veteran has authrized (Hme Inspectin) NON-Allwable Fees Base Escrw Fee Lan Tie-in Fee Demand/Payff Statement fee (k n refinance nly) Sub Escrw Fee (title payff fee) Recnveyance Fee (k n refinance nly) Prepayment penalties (k n refinance nly) Any Lender Dcument Fee Prcessing Fee Warehuse Fee Lan Discunt Pints Charges by ther Lenders Tax Service Cntract Underwriting Fee Administratin Fee Pht Inspectin Fee Recrding Fee (grant deed) Messenger r Delivery Fees Ntary Fee Hmewners Assc. Transfer Fee Assignment Fees VA Cash-Out Refinance

10 Dcumentary Transfer Tax Fee Bring Dwn Fee Change f Ownership Fee Cmmissin Transactin Crdinatr Fee Title Plicy Endrsement Fees Nte: As lng as there is n riginatin fee being charged t the veteran, the veteran can pay up t 1% f the ttal lan amunt in NON-Allwable fees. LDP/GSA CAIVRS Required fr all brrwers Required fr all brrwers DEMAND Payff must reflect current lan balance and nt mre than 60 days interest. (example; clsing mnth f may, may payment nt made, interest fr April & May allwed n demand & financed). Title Useful Link Clsing Prtectin Letter VA Cash-Out Refinance