Conventional Loans with DSHA Paid Mortgage Insurance...
Transcript of Conventional Loans with DSHA Paid Mortgage Insurance...
Delaware State Housing Authority
Conventional Loans with DSHA Paid Mortgage
Insurance - Lender Training
• DSHA is committed to follow all aspects of the Fair Housing Act in our efforts to promote responsible homeownership and obtaining competitive and safe financing for same.
Agenda
• Overview of Mortgage Products• Compliance Review and Guidelines• Compliance File Delivery• Eligible Loan Products• Allowable Fees• Loan Flow• Registration/Loan Reservation Process• Pipeline Tracking• Program Documents• Closed Loan Delivery
Overview of DSHA Mortgage Programs
• DSHA Mortgage loan products are designed to enable income‐qualified families to achieve the dream of homeownership.
• Advantages for DSHA borrowers include:– Below‐market interest rates– Downpayment Assistance Options– 30 year fixed rate loans
• When DSHA funds are used to finance mortgage loans, certain criteria are required including:– Maximum loan size or purchase price limits– Income limits– Owner‐occupancy requirements– Restricted to properties located in Delaware
Eligible Conventional Loan Products
• Fannie Mae Conventional: HFA Preferred product only– A Conventional Loan Delivery Fee of 1.0% will apply to all Conventional loans.
• Product is available for loans up to 97% LTV
DSHA Compliance Review
There are three components of Compliance Review:1. Total Household Income (see
DEStateHousing.com website for current program Limits)
2. Purchase Price or Loan Limit (based on program and ancillary down payment products)
3. First‐Time or Repeat Homebuyer Status
Benefits of Conventional Loans with DSHA Paid MI Option
• With the Conventional loan DSHA Paid MI program, DSHA will pay the upfront Mortgage Insurance Premium on behalf of the borrower, thereby eliminating the need for borrowers to pay a monthly insurance premium in addition to their PITI payment, resulting in lower monthly payments.
DSHA-Paid MILoan Comparison
• Example based on $186,000 sale price, 720 FICO• Reduced monthly payments compared to traditional
Conventional Loans.• For example: A borrower with a $186,000 home price will
save over $70 per month• That’s about one mortgage payment per year
Payment based on $186,000
Conventional Loan with Monthly MI Payment
Conventional Loan with DSHA Paid MI
Rate 4.5% 4.5%
Monthly PI&I $987 $914
Monthly Savings $73
Conventional DSHA Paid MI Overlays Pre-closing
• Minimum FICO score of 680• Maximum DTI of 45%• 1 Unit Properties Only – no Condos• Loans must delivered to US Bank via their
DocVelocity imaging system both for underwriting and closed loan delivery.
• US Bank must issue a “clear to close” prior to closing.
Conventional DSHA Paid MI Overlays Post Closing
• Lenders must close loan in accordance with US Bank DU findings. US Bank will provide lenders with reps and warranties for loans US Bank underwrites.
• Once closed, closed loan packages must be delivered to US Bank via DocVelocity imaging system.
• MI Underwriters will be on‐hand at US Bank to review files and issue MI Certificates within 48 hours of delivery.
• US Bank will pay MI Premiums on behalf of DSHA.
Loan Flow• Lender pre‐qualifies homebuyer per DSHA and Agency
guidelines. • Lender registers loan(s) through DSHA’s Mitas Online
Reservation System at https://MITAS.destatehousing.com• Lender delivers underwriting file to US Bank through
DocVelocity imaging system.• If approved by US Bank, lender is issued a “clear to close”.• Lender uploads compliance file to DSHA for eligibility review: • Once “Committed” by DSHA, Lender closes loan and delivers
closed purchase file to U.S. Bank for funding.• US Bank will issue Mortgage Insurance Certificate upon
receipt of loan file.• Once closed, closed loan packages must be delivered to US
Bank via DocVelocity imaging system.
DSHA Contacts & ResourcesTelephone: 302‐577‐5001
Fax: 302‐577‐5021Main website: DeStateHousing.comLender Resource Center: Lenders.DeStateHousing.com