Post on 10-Feb-2018
Offered through 21st Century Home Loans’ WHOLESALE DIVISION
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CHF ACCESS Training
Desktop Underwriter is a registered trademark of Fannie Mae. Loan Prospector is a registered trademark of Freddie Mac. This presentation is
a summary and is not complete. This information is for mortgage professionals only and should not be distributed to or used by consumers or
other third-parties. Information is accurate as of the date shown below and is subject to change without notice.
Today’s Challenges
Seller paid DAPs discontinued (Nehemiah, etc.)
More restrictive guidelines/products
Slow market
Struggling Economy
Maxed out sellers
Higher cost of living = Less money to save
Over $7.2 Billion in
1st & 2nd loan
financing since 1993
(53,000 properties)
What
“CHF ACCESS”offers
15-Year Fully Amortized 2nd
Up to 3% of Sales Price
CLTV up to
99.50%
LITTLE TO NO MONEY OUT OF POCKET
1st Loan 2nd Loan Home
Ownership
FHA up to 96.50% LTV
VA available to 100% LTV - Must be approved for VA through 21st
Century Home Loan
CHF ACCESS PROGRAMS
Eligible 1st Mortgage Program Down Payment & Closing Cost Assistance Sample Calculations Income Limit Calculation
CHF Access
1st & 2nd
CHF ACCESS Program
Topic Program Description
State Restriction Available throughout the WHOLE STATE OF CALIFORNIA ONLY!
Program Types FHA 30 Year Fixed
Max LTV 96.50%
Max CLTV 99.50% (Unlimited if funded by a Government Sponsored Entity) – Follow FHA guidelines
Maximum Loan Amount
Conforming: Up to $417,000Jumbo: > $417,000 to $729,750 based on county where property is locatedFHA Loan Limits
Loan Purpose Purchase
Occupancy Owner Occupied
Down Payment Assistance
CHF ACCESS 2nd: • CAN be used to fulfill the borrower’s equity contribution required on
FHA 1st Mortgage
CHF ACCESS 2nd Program
Topic Program Description
Program Types CHF ACCESS 2nd Fixed
Term 15-yrs Fixed-Rate Fully Amortizing
Maximum Loan Amount Sized up to 3% of the Sales Price
Interest Rate 8.25%
Max CLTV 99.50% or higher – Follow FHA guidelines
Use of Funds Proceeds may be used for: DOWN PAYMENT CLOSING COSTS Price Adjustments Up Front or Single Premium MI
No cash back to the borrower from the 2nd loan proceeds• Any overage over POCs must be used to reduce principal
balance• Any overage over $500 results in redraw of loan documents
Sample Scenario: (Purchase Price: $325,000)
Sample 1: Borrower has little or NO money Down - Seller contributing for costs…
CHF ACCESS 1st: 96.50% ($325,000 x 96.50%) $313,625.00 +
CHF ACCESS 2nd (Down Payment): 3% ($325,000 x 3%) $9,750.00 +
Total Financing 1st & 2nd: 99.5% of Sales Price $323,375.00 =
Borrower Required Down Payment: .5% ($325,000 x .5%) $1,625.00
Borrower Contribution: .50% ($1,625) for DP (Seller pay for Closing Costs)
Sample 2: Borrower HAS Down Payment but NO money for Closing Costs...
CHF ACCESS 1st: 96.50% ($325,000 x 96.50%) $313,625.00 +
Borrower Funds (Down Payment): 3.5% ($325,000 x 3.5%) $11,375.00 +
CHF ACCESS 2nd (Closing Costs): 3% ($325,000 x 3%) $9,750.00
Total Financing 1st & 2nd: 99.50% of Sales Price $325,000.00 =
Borrower Contribution: 3.5% ($11,375) for DP
Sample Scenario: (Purchase Price: $325,000)
Sample 3: Borrower has NO money for D/P OR C/C - Receiving Gift Funds of 5%...
CHF ACCESS 1st: 96.50% ($325,000 x 96.50%) $313,625.00 +
CHF ACCESS 2nd (Down Payment): 3% ($325,000 x 3%) $9,750.00
Total Financing 1st & 2nd: 99.50% of Sales Price $323,375.00 =
Gift Funds Received 5% ($325,000 x 5%) $16,250.00
.5% given for DP 0.5% ($325,000 x .5%) $1,625.00
4.5% towards CC 4.5% ($325,000 x 4.5%) $14,625.00
Borrower Contribution: ZERO ($0)
Program Income Limits
Topic Guidelines
Income LimitCalculation
Based on Qualifying Income Only (not Household Income)
Only the income used for Qualifying is considered in order to meet the Program Income Limits
Income Limit = 120% of HUD AMI
Income Limits To calculate the Program Income Limit by County, refer to:
http://www.huduser.org/datasets/il.html
Tip: Create an Income Limit spreadsheet
ADDITIONAL GUIDELINES
Eligibility GuidelinesGeneral Underwriting GuidelinesPricing, Costs and Fees
Eligibility Guidelines
Topic GuidelinesBorrower Eligibility Purchase of Owner-Occupied Primary Residences Only
NO 1st Time Homebuyer RequirementMAY OWN OTHER PROPERTIES – must meet FHA requirements
Property Eligibility Single Family Residences PUD’s FHA Approved Condos Manufactured Homes – Must meet FHA requirements
Income Limits 120% of HUD Area Median Income (AMI)
Sales Price Limits Not Applicable
First Time Homebuyer Not Required
Non Occupying Co-Borrowers/Co-Signers
NOT ALLOWED
Homebuyer Education Required
Minimum Homebuyer Contribution
NONE required
Underwriting Guidelines
Topic GuidelinesUnderwriting UW Method:
DU / LP allowed – Must be risk scored by FHA Scorecard Approve/Eligible, Accept or Accept Plus recommendations Manual UW allowed
**Unless specifically specified, Follow Standard FHA guidelines PLUS
21st Century FHA overlays**
Minimum Credit Scores
NO MINIMUM FICO SCORES required
Follow 4155 guidelines PLUS 21st Century overlays
Price Adjustments apply – See First Mortgage rate sheet
Max Debt Ratio 43% Maximum DTI
Reserves NONE required
Mortgage Insurance Follow standard FHA MIP
Buy-Downs NOT ALLOWED
UW Guidelines cont’d…
Topic Guidelines
Seller Contributions Allowed up to 6%
Gift Funds Allowed from family members
Other Sources of Assistance
Gift Funds 401k loans Grants Section 8 programs (subject to FHA guidelines)
Prepayment Penalty
No Prepayment Penalty
Assumability Allowed per FHA guidelines
ACCESS Fees & Charges
Topic Guidelines
Interest Rates Interest Rates available on the 21st Century Home Loan Rate Sheet found
on the individual website – www.21lending.com
Contact 21st Century Home Loan for more information
Origination Fees Up to 1.00% on 1st Mortgage only (RETAINED BY BROKER)
Discount Fees Buyer or Seller Discounts allowed subject to consumer laws • Discount Points allowed for additional lender compensation (subject to
Lender’s discretion)
Rebate/Discount Pricing
See 21st Century rate sheet
FMC Fees See doc order form or contact your Account Executive for lender fees
Allowable Fees Must be reasonable and customary and fully disclosed to the borrower in accordance with all agencies, federal, state and local laws
Follow 21st Century rules on limitation of fees for FHA loans