Underwriting Guideline Matrix

Transcription

1 Program / Product Codes: NewLeaf Wholesale VA Lender ID Number: SKYLINE FINANCIAL CORPORATION Subject to Change Without Notice Valid as of: 11/06/2015 Copyright 2015 Skyline Financial Corp. dba Skyline Home Loans Nationwide Mortgage Licensing System & Registry (NMLS) Company ID 12072, Arizona Arizona Mortgage Banker License , California Licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act File No: , Colorado Registered with Colorado Division of Real Estate, Connecticut Connecticut Mortgage Lender License No. ML 12072, Florida Florida Mortgage Lender/Servicer License No. MLD947 issued by the Florida Office of Financial Regulation, Georgia Georgia Mortgage Lender License 42980, Hawaii Licensed by the Hawaii Division of Financial Institutions No. HI 12072, Idaho Licensed by the Idaho Department of Finance MBL 7422, New Mexico New Mexico Financial Institutions Division, Registered Mortgage Company License 01653, Oregon Licensed by the Division of Finance & Corporate Securities No. ML2797, Tennessee Tennessee Mortgage License Texas Registered with Texas Department of Savings and Mortgage Lending, Utah Licensed by the Division of Real Estate License , Washington Licensed by the Department of Financial Institutions No. CL 12072, West Virginia West Virginia Mortgage Lender License ML

2 NewLeaf Wholesale VA Lender ID Number: SKYLINE FINANCIAL CORPORATION Please note that this matrix is intended as an aid to help determine whether a loan is eligible for VA financing. It is not intended as a replacement for VA guidelines. Users are expected to know and comply with VA requirements. Additionally, this matrix includes overlays, which may be more restrictive than VA requirements. A thorough review of this matrix is highly recommended. For any circumstance that is not addressed in this matrix, refer to the VA Handbook. Owner Occupied: Purchase Transaction Parameters For Hawaii LTV /CLTV 1-4 $417,000 $625,500 $1,500, % 600 For Hawaii Owner Occupied: Rate / Term Refinance LTV /CLTV 1-4 $417,000 $625,500 $1,500, % - Credit Qualifying 600 For Hawaii Owner Occupied: IRRRLs LTV /CLTV 1-4 $417,000 $625,500 $1,000, % 600 For Hawaii Owner Occupied: Cash Out LTV / CLTV 1-4 $417,000 $625,500 $1,500,000 95% $417,000 $625,500 N/A 100% 620 Page 1 of 5 Last Updated 11/6/2015

3 VA mortgage limits for all areas: General Guidelines Loan Limits/FullCountyLoanLimitList2015_HERA BASED_FINAL.pdf Loan Limits Maximum Base cannot exceed the VA Statutory Mortgage Limits for each county, see link above for specific VA County Mortgage Limits. Property Types Use VA Entitlement Worksheet in Tools section of website to determine the maximum Balance loan amount and required down payment Eligible: SFR, 2-4, Condo (Must be VA Approved), PUDs, Rural Properties, Manufactured Housing Ineligible: Co-ops, Working Farm, ranch or orchard, Properties with individual water purification system VA Funding Fee See Funding Fee Chart in Tools Section of Web Site Eligible States AZ CA, CO, CT, FL, GA, HI, ID, NM, OR, TN, TX, UT, WA & WV Minimum Loan Amount $75,000 Maximum Loan Amount $1,500,000 Purchase, Rate/Term & Cash-Out transactions $1,000,000 - IRRRLs Geographic Restrictions Loan Purpose IRRRLS Texas cash out refinance not allowed. Florida condos - Primary Residences: Purchase or Rate/Term Only to the lesser of 80% LTV or per product guideline Purchase o Use Purchase Funding Fee Limited Cash Out/Rate & Term Refinance: o Proceeds can be used to pay off an existing VA first mortgage regardless of age. o Pay related Closing Costs and Prepaid items. o No cash out to the Borrower Disburse cash out to the borrower in an amount not to exceed $0.00. o Max loan amount worksheet VA Form to be completed. o Use IRRRL Funding Fee Cash-Out: o May payoff current mortgage, tax or judgment liens or VA, FHA or conventional mortgage, cash back for any purpose acceptable to lender and allowable fees and charges o Maximum $150,000 cash-out for all LTVs o Use Cash-Out Funding Fee IRRRLs: o Please see IRRRL section below for details o Use IRRRL Funding Fee IRRRLs are non-credit qualifying unless the borrower(s) PITI increases by 20% or more or there is less than a 6 month payment history, then the borrower(s) must credit qualify For non-credit qualifying IRRRLs all the following requirements must be met: o 6 months seasoning is required. The loan being refinanced must have at least 6 months seasoning from the original note date to the new loan s closing date (note signing) o The proposed IRRRL does not increase the principal balance outstanding on the prior existing residential mortgage loan, except to the extent of fees and charges allowed by VA o Total points and fees other than bona fide third party charges not retained by the mortgage originator, creditor, or an affiliate of the creditor or mortgage originator payable in connection with the proposed IRRRL do not exceed 3 percent of the total proposed principal amount o The interest rate on the proposed IRRRL is lower than the interest rate on the loan being refinanced, unless the borrower is refinancing from an adjustable rate to a fixed-rate loan o The principal and interest payment on the proposed IRRRL is less than the principal interest on the loan being refinanced unless one of the following exceptions apply: the IRRRL is refinancing an ARM, or the term of the IRRRL is shorter than the term of the loan being refinanced o A significant increase in the veteran s monthly payment may occur with any of these three exceptions, especially if combined with one or more of the following: financing of closing costs financing of up to 2 discount points financing the Funding Fee, and/or higher interest rate when an ARM is being refinanced o A tri-merged credit report is required to validate credit score and mortgage payment history o 0 x 30 mortgage lates within the past 12 months and loan must be current o The recoupment period for all allowable fees and charges financed as part of the loan or paid at closing does not exceed thirty six (36) months, except in cases in which the loan is being refinanced from an adjustable rate to a fixed rate mortgage or in which a fixed rate loan is being refinanced into another fixed rate loan of a shorter duration o The requirements related to exemption of income verification are satisfied o Verbal VOE's will be performed to validate employment must reflect employer or source of income; however, monthly income is not to be indicated. For retired borrowers, a copy of the award letter or other documentation is required. o DTI is not calculated o IRS Tax Transcripts are not required o An AVM (ordered by NewLeaf) or 2055 (Drive By) Appraisal is required to validate value (Not ordered through VA Portal) o HPML loans are not eligible o Manufactured Homes are not eligible Page 2 of 5 Last Updated 11/6/2015

4 Eligible Terms Conforming Fixed Rate (10-,15-, 20-, and 30-Year) Balance Fixed Rate (10-,15-, 20-, and 30-Year) No Buydowns IRRRLs Fixed (15 & 30 Years) - The maximum loan term is the original term of the VA loan being refinanced plus 10 years, but not to exceed 30 years and 32 days. For example, if the old loan was made with a 15-year term, the term of the new loan cannot exceed 25 years Qualifying Rate Note Rate Qualifying Ratios For loan amounts $417,000: AUS: 60% DTI; Manual: 50% DTI with compensating factors For VA Balance loan amounts (Total loan amount > $417K or > $625,500 in HI): AUS: 60% DTI; Manual: 45% DTI with compensating factors AUS Loans must have an AUS approval unless they are manually underwritten Manual Underwriting Eligible Borrowers If DTI exceeds 41%, veteran must have 120% of required residual income Veterans Veterans and spouse Surviving Spouse of Veteran Eligibility is determined by VA Veteran must have died on active duty or as a result of service-connected injuries or illness. VA to determine veteran s cause of death Certificate of Eligibility A Certificate of Eligibility (COE) is the ONLY acceptable proof of eligibility and is issued by the VA only. A COE is required for all VA purchase and cash out refinance transactions. A COE is not required for VA IRRRLs however, COE will be needed to provide proof of exemption, if applicable to the Borrower. COEs greater than 6 months old are considered expired and an updated COE is required prior to close. The veteran s name on the Certificate of Eligibility must match the veteran s name in WebLGY, the loan guaranty certificate and the note and mortgage. Surviving spouse of Veteran Certificate of Eligibility must be in surviving spouse s name and social security number. POA Powers of attorney are not permitted for cash-out transactions in which the borrower consolidates non-mortgage debt and/or receives cash back at closing unless the veteran is deployed overseas There must be more than one borrower on the loan and at least one borrower must be present at closing POA is not allowed for single borrower transactions Title policy may not include any exceptions related to the POA NewLeaf underwriter must verify the Veteran is alive at time of closing, whether or not the Veteran is in the military Financing Concessions Subordinate Financing Non-Purchasing Spouse / Non- Borrowing Spouse Non-Occupant Co-Borrower Co-Borrowers Number of Financed Properties Credit Requirements Financing concessions cannot exceed 4% of the lessor of the purchase price or appraised value. All CC and discount points may be paid by seller regardless of the amount. Subordinate financing is only permitted for IRRRLs Except for obligations specifically excluded by state law, the debts of the non-purchasing / non-borrowing spouse must be included in the borrower s qualifying ratios, if the borrower resides in a community property state, or property being insured is located in a community property state. The non-purchasing / non-borrowing spouse s obligations must be considered in the debt-to-income (DTI) ratio unless excluded by state law. A tri-merged credit report must be provided for the nonpurchasing / non-borrowing spouse in order to determine the debts that must be counted in the DTI ratio. The nonpurchasing spouse / non-borrowing spouse must provide a signed / dated Borrower s Credit Authorization Not permitted Spouses are permitted If two veterans are splitting their entitlement as co-borrowers, the loan must be underwritten and approved by the VA. However, the loan will first be underwritten by a NewLeaf underwriter to confirm eligibility of the loan. No maximum number Each borrower must have at least 1 valid credit score On Balance loans, the borrower may not have any 30 day mortgage lates in the previous 12 months Bankruptcy Foreclosure Short Sale 2 years must have elapsed since completion or discharge of Ch. 7 or Ch.13 1 year can be considered on Chapter 13 if 12 months of satisfactory payments have been made and Trustee of the Bankruptcy approves if borrower is still completing terms of Ch. 13 bankruptcy AUS Approval & IRRRLs: Conforming: 2 years must have elapsed since the date of the foreclosure Balance: 7 years must have elapsed since the date of the foreclosure Manual: Conforming: 5 years must have elapsed since the date of the foreclosure Balance: 7 years must have elapsed since the date of the foreclosure AUS & IRRRLs: 2 years must have elapsed since the date of the short sale. Manual: 5 years must have elapsed since the date of the short sale CAIVRS NewLeaf will run CAIVRS, borrower(s) must obtain a clear rating Page 3 of 5 Last Updated 11/6/2015

5 Judgments & Collections All judgments must be paid Collections / Charge-Off Accounts: Follow AUS findings and VA guidelines for manually underwritten loans Paying Off Debt Non-Traditional Credit Installment debt allowed, payment excluded from qualifying ratios Revolving Debt may be paid off to qualify and the account must be closed prior to funding Not permitted to replace traditional credit and scores Paying Down Debt Not allowed Assets Gifts are permitted as long as the gift comes from a close family member or a person having a long standing relationship with the borrower Gifts given in the form of cash are not permitted Reserves 1 Unit - Reserves are not required if borrower does not own other properties 2-4 Unit Subject Property - Purchase & Full Doc Refi - 6 months PITI if rental income is being used to qualify Conversion of Current Primary Residence into an Investment Property - 6 months PITI for both current residence and new residence Current Residence pending sale but not sold prior to purchase of new primary residence - 6 mos PITI for both properties; if 30% equity documented for current residence, 2 mos PITI for each property Conversion of Current Primary Residence to 2nd Home - 6 mos PITI for each property; if 30% equity documented for current residence, 2 mos PITI for each property Additional Investment Properties Owned, Not The Subject Property- 3 mos reserves for each property Documentation Type/Tax Transcripts Validated IRS tax transcripts are required for each borrower whose income is utilized as a source of repayment. The most recent two year tax transcripts are required. TOTAL Scorecard Accept Self-Employed Borrowers (ML ): P & L and Balance Sheet required if more than a calendar quarter has elapsed since the date of most recent calendar or fiscal-year end tax return was filed by the borrower. Appraisal Requirements Collateral LAPP appraisal must be ordered on VA's WebLGY. Refer to appraisal section of New Leaf Website for instructions on how to order an appraisal and NewLeaf s VA number IRRLS: An AVM (ordered by NewLeaf) or a 2055 (Drive By) Appraisal is required to validate value (Not ordered through VA Portal) Validity period of 6 months for VA appraisals (NOV) including new and proposed constructions Condominiums Condominiums must be VA Approved. FHA approved condominiums are acceptable if the project was approved after 12/7/09 Florida condos Only allowed for primary residence/ purchase or rate/term up to the lesser of 80% LTV or per product guideline Properties Recently Listed for Sale Rate / Term Refinance: Listing must be cancelled at time of application and appraisal date Cash Out Refinance: 6 month seasoning is required. If expired / cancelled listing is less than 6 months old, LTV is limited to 70% Unless specified below, all above VA guidelines must be met Maximum : Maximum loan amount is $417,000. Balance loan limits are ineligible Manufactured Housing Underwriting Method: AUS approval is required Manual Underwriting is not allowed Transaction Types: Purchase Mortgages o An existing manufactured home must have been permanently attached to its foundation for a minimum of 12 months prior to the loan application date. New construction is ineligible. Rate Term Mortgages: Proceeds of a limited cash-out refinance mortgage may be used to: o Pay off the outstanding principal balance of an existing first lien mortgage secured by the manufactured home and land (or existing liens if the home and land were encumbered by separate first liens); The current appraised value of the manufactured home and land; or If the manufactured home was owned by the borrower for less than 12 months on the loan application date and if the home and land are secured by separate liens, the lowest price at which the home was previously sold during that 12 month period plus the lower of the current appraised value of the land or the lowest sales price o HUD1 Statement required from any transaction within the past 6 months. If previous transaction was a cash out or if it combined a non- purchase money second lien into a new first, the loan is ineligible o Payoff of the existing first mortgage regardless of seasoning o Payoff of existing subordinate liens that were used in whole to acquire the subject property o Closing costs and prepaids items may be financed into the loan amount o Cash out limited to the lesser of 2% of the principal amount of the new loan or $200 whichever is less for conventional o Acceptable Continuity of Obligation Cash-Out Transactions Not Allowed IRRRLs Not Allowed Eligible Property Types: 1 unit Manufactured house with the following requirements: Double Wide or larger 600 Minimum square feet and 12 feet wide Maximum 10 acres Page 4 of 5 Last Updated 11/6/2015

6 Ineligible Property Types: Condo Manufactured housing Co-op manufactured housing PUD manufactured housing Leasehold property New Construction manufactured home Single Wide Manufactured housing Manufactured Housing (Cont.) Property Requirements: The land must be fee simple The Manufactured Home must be a one unit dwelling legally classified as real property The towing hitch, wheels, and axles must be removed The Manufactured Home must have sufficient square footage, room dimension to be acceptable to purchasers in the subject market area The Manufactured Home must have been built in compliance with the Federal Manufactured Home Construction and Safety Standards that were established 6/15/1976 as well as additional requirements that appear in HUD regulation at 24 C.F.R Part 3280 evidence by: o HUD Data Plates/Compliance Certificate o HUD Certification Label The appraisal form 1004c must indicate evidence of the HUD Data Plate/Compliance Cert and the HUD Certification Label The Manufactured Home must be attached to a permanent foundation system Engineers Certificate for foundation system is required The Manufactured Home must be permanently connected to all necessary utilities Property cannot be located in flood zone Title Requirements: Endorsement ALTA 7,7.1 or 7.2 is required Confirm property is legally classified as real property. Any certificate of title to the manufactured home must be surrendered to the appropriate state government authority. Owner of the manufactured home must also own the land on which home is situated o A mortgage/deed of trust must be recorded in the land records and must identify the encumber property as including both the home and the land. It must also include the VIN,Serial numbers form the HUD Data Plate of the manufactured home along with the description of the land. Appraisal Requirements: Appraisal must be completed using the Manufactured Home Appraisal Report Form 1004C Appraiser must use a minimum of three comparable sales of similar manufactured home A detailed and supported cost approach to value is required on all MFH appraisals The following are ineligible: o If the site or manufacture home is substantially non-conforming with the neighborhood it is ineligible o Creating comparable sales by combining vacant land sales with the contract purchase price of the home is prohibited. Page 5 of 5 Last Updated 11/6/2015