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1-4 Family Units, Condo, PUD, Mixed Use Stores Owner occupied properties ONLY – No Investor.
1. All Loans amounts - for FHA County limits go to https://entp.hud.gov/idapp/html/hicostlook.cfm
2. Purchase / R/T Max LTV 97.75%
3. Cash out 1-2 unit Max LTV 95%
4. Cash out with 30 or 60’s LTV 85%
5. Cash out 3-4 unit LTV 85%
6. 1-2 unit - No reserves
7. 3-4 unit - 3 months PITI required
8. Gifts permitted for 3.0% Down
9. Debt Ratio should not be higher than 31/43 - 40/50 with compensating factors
10. 6% seller concession on all purchases
11. Minimum FICO is 500
12. NO credit, NO credit score - alternative trades, 3 trades for 12 months
FULL INCOME DOC:
Wage Earner:
1. Last 2yrs W2’s and current YTD pay stub
2. 4506T is checked prior to close
Self Employed/Sole Proprietor:
1. Complete 2 yrs signed/dated tax returns (all schedules)
2. YTD P&L from CPA/accountant
Self Employed Partnership or S Corp:
1. 2 yrs signed and dated Personal and Business tax returns (all schedules)
2. YTD P&L from CPA/accountant
3. 2 yrs continuous employment necessary for primary borrower
4. Part time job must be 12+ months
5. Borrower is considered self employed with 25% or greater ownership interest in a business
Foreclosure
1. Foreclosure seasoning from payoff date
2. Deed in Lieu seasoning from completion date of the action
3. Generally borrower must have no Foreclosure or Deed in Lieu in previous 3 years
4. Exception - If foreclosure was result of extenuating circumstances beyond the control of borrower(s) who has re-established credit since the foreclosure.
Housing Payment History
1. 12 month mortgage history must be documented by credit report, VOM, Management company VOR, or 12 months canceled checks.
2. Private party VOR is acceptable with 620 fico and 2 as agreed trade lines
3. Borrowers with <620 fico and private party VOR/or no rental history are subject to DU/LP approval
4. If borrower is purchasing property they are currently renting, canceled checks are required. Canceled checks may be waived if borrower has 620 fico, 2 as agreed trades and proof seller is current on the mortgage.
Bankruptcy Guidelines
1. Chapter 7 must be discharged 2 years with re-established credit and no late payments
2. Minimum of 18 months with extenuating circumstances-requires explanation and proof
3. Chapter 13 ok with a minimum of 12 months in BK and 0x30 pmt history to trustee.
4. Required docs include: Evidence plan has been confirmed - Trustee rating - Written demand from trustee - Notice of Right to Encumber or Trustee Letter from court (written approval) and No major late payments after bankruptcy
Upfront PMI and Monthly MIP
1. Upfront MIP-Borrowers are required to pay an upfront, one time fee of 1.5% of the base loan amount. This fee can be paid by the borrower or seller in cash at the closing or financed into the loan.
2. Monthly MIP- is .50% x loan amount divided by 12 (borrower will pay every month) on loans > 15 yrs. 15yrs and less is .25% x loan amount divided by 12 (see C for only exception)
3. For mortgages with terms 15 years and less and with Loan to Value ratios 90 percent and greater, annual premiums will be canceled when the Loan to Value ratio reaches 78 percent regardless of the amount of time the mortgagor has paid the premiums.
4. For mortgages with terms more than 15 years, the annual mortgage insurance premiums will be canceled when the Loan to Value ratio reaches 78 percent, provided the mortgagor has paid the annual premium for at least 5 years.
5. Mortgages with terms 15 years and less and with Loan to Value ratios of 89.99 percent and less will not be charged annual mortgage insurance premiums.
Compensating factors
1. Larger down payment.
2. Debt ratios under the maximums
3. Strong credit or high credit scores
4. Well established job history
5. Well established H/E history
6. Down payment paid by the borrower
7. 2 to 6 months PITI Reserves
8. Minimal payment shock
9. No recent derogatory accounts
10. NO government loans in default
11. Bankruptcy past 2 years ago
12. Credit re-established
Grant Program Call Mike Whipple to Arrange A Grant for your Client.
1. Grant is from Non-Profit
2. NO additional qualification
3. Grant is 3.00% of the purchase price
4. NO repayment is required – it is FREE
5. Seller can pay up to 6% of closing costs
Collections,Charge-offs,Judgments
1. All collections and charge over $2500 must be paid off (Manual U/W's only)
2. DU/LP approval the findings determine the way collections are resolved
3. All Judgments must be paid in full
Property Evaluations
1. FHA Appraisal
2. Appraiser’s Repair List Cleared
3. FHA case number
203K Streamlined Rehabilitations Mixed Use and 1 to 4 Units
Allows homebuyers to finance up to an additional $35,000 into their mortgage to improve or upgrade their home before moving-in by easily tapping into cash to pay for property repairs or improvements.
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