Handouts

FAIRWAY Wholesale Lending A Division of Fairway Independent Mortgage Corporation

FHA Loan Origination

FHA Loan Origination 203(b) and 234 (c) Program

1

Why choose an FHA loan

Many homebuyers today either do not have sufficient cash-to-close or they do not meet the qualifying guidelines for conventional financing FHA is more lenient and forgiving when a borrower has credit issues They also allow the borrower to have more acceptable sources of down payment and monthly income as well as higher qualifying ratios

HUD was created to help low-moderate income families It has evolved today for

First-time home buyers

Borrowers with minimum established credit

Families who have had some credit problems but have overcome their problems and are now credit-worthy

Fairways FHA sponsorship requirements

No audited financial statements required for 2010 and beyond

II Self prepared financial statements acceptable

II Only a $25000 minimum net worth required or state requirement whichever is greater

II Sole Proprietors and Partnerships and LLCs with one ownermember

Home office allowed

iii A four (4) hour FHA Loan Origination training course is required for brokerpartners with little or no FHA lending experience

2

Definitions

Lender =Broker

41551 Discusses the types of transactions and properties eligible for mortgage insurance and FHAs requirements for determining the borrowers ability and willingness to repay the debt These underwriting guidelines apply to mortgages insured under Sections 203(b) and 234(c) of the National Housing Act and are generally applicable to other single-family mortgage insurance programs

Mortgage References Inc (MRI Quick Reference Guide) This publication is designed to provide only a user friendly reference for the everyday questions and issues that arise in the work of originating processing and underwriting one to four-family FHA-insured mortgages

Definitions Direct Endorsement (DE)

Direct Endorsement (DE) is the mechanism that enables HUD-Federal Housing Administration (FHA)-approved lenders to consider single-family mortgage applications without first submitting paperwork to HUD The purpose of the DE program is to simplify and expedite the process by which lenders can obtain mortgage insurance endorsements from HUD Under FHAs Direct Endorsement (DE) program approved Lenders may underwrite and close mortgage loans without prior FHA review or approval The Iender assumes responsibility for the obligation of the mortgage loan without prior HUD review This includes all aspects of the mortgage loan application the property analysis and borrower underwriting

Note This assumes that the lender is a DE lender with unconditional approval

3

Definitions Technology Open To Approved Lenders (TOTAL) Mortgage Scorecard FHAs TOTAL Mortgage Scorecard evaluates the overall creditworthiness of the applicants based on a number of credit variables and when combined with the functionalities of the Automated Underwriting Systems (AUS) indicates a recommended level of underwriting and documentation to determine a loans eligibility for insurance by FHA Taken together TOTAL and AUS either conclude that the borrowers credit and capacity for repayment of the mortgage are acceptable or will refer the loan application to a Direct Endorsement (DE) underwriter for further consideration and review It is FHAs policy that no borrower be denied a FHA-insured mortgage solely on the basis of a risk assessment generated by the TOTAL mortgage scorecard

Eligible Borrowers

Borrower(s) meeting minimum age per state requirements

Non-occupant co-borrower(s)

CJ Limited to one unit property only

CJ Non-occupant co-borrower(s) may NOT be allowed on a Cash-Out refinance

CJ Kiddie Condos are also eligible (owned by parents)

II Non-purchasing spouse

Military Personal

III Permanent resident alien

III Non-permanent resident alien

4

III

Non Occupying Borrowers aka Iltiddie Condo

bull Borrower(s) related by blood marriage or law such as 11 spouses 11 parent-child 11 siblings 11 stepchildren 11 aunts-uncles 11 nieces-nephews or

Unrelated individuals that can document evidence of a family-ype longstanding and substantial relationship not arising out of the loan transactIon

Refer to Section 60302 pages 88-89 in the MRI Quick Reference Guide

See Attachment 1 - Guidelines from the HUD 41551 Chapter 2 Section B3a

Citizenship and Immigration Status

Lawful permanent resident alien - FHA insures mortgages using the same terms and conditions as those for US citizens The mortgage file must o include evidence of the permanent residency and o indicate that the borrower is a lawful permanent resident alien on the Uniform

Residential Loan Application (1003)

Non-permanent resident alien - FHA insures mortgage made to nonshypermanent resident aliens provided that the o property will be the borrowers principal residence o borrower has a valid SSN and o borrower is eligible to work in the US as evidenced by an Employment

Authorization Document (EAD) issued by the US Citizenship and Immigration Services (USCIS)

Refer to Section 60102 page 75 in the MRI Quick Reference Guide

See Attachment 2 - Guidelines from the HUD 41551 Chapter 4 Section A3a

5

FHA Maximum LTV Quick Summary Matrix

Transaction Type

III Purchase

III Rate and Term Refinance

III Streamline Refinance WITH Appraisal

Streamline Refinance WITHOUT Appraisal

Cash-Out Refinance

Second Home

Investment Property

FHA allows One-Io-Four Family Living UnHs

Maximum LTV

II 965 (35 down payment)

III 9775

III Lower of 9775 or max loan amount calculation

NA - Max loan amount calculation applies

850

Ineligible

Ineligible

Down Payment Requirements

The FHA down payment requirement is 35

CJ Borrower(s) own funds

CJ 100 gift from a family member relative etc (see Gift slide)

CJ Secured borrowed funds (see Secondary Financing slide)

Sale Price X 965 = Base Loan Amount

Sales Price X 35 = Minimum Down Payment

III

6


Assuming a $100000 sale price

1 What is the down payment

2 What is the minimum amount the borrower must have in the transaction

If the seller is willing to contribute $1500 towards closing costs and closing costs are $2800 what is the borrowers cash to close without prepaid expenses


Assuming a $100000 sale price answers

1 What is the down payment $3500 2 What is the minimum amount the borrower must

have in the transaction $3500 3 If the seller is willing to contribute $1500 towards

closing costs and closing costs are $2800 what is the borrowers cash to close without prepaid expenses $4800

Down payment ($3500) + Closing Costs ($2800) - Seller Contribution ($1500) =$4800

7

An outright gift of cash investment is acceptable if the donor is

The borrowers relative

The borrowers employer or labor union

A charitable organization

A government or public agency that has a program providing ownership assistance to

o Low and moderate income families or

o First-time homebuyers

A close friend with a clearly defined and documented interest in the borrower

Refer to Section 30203 and 30204 in MRI Quick Reference Guide

Secondary Financing - Family Jlember

FHA permits lending from family members on a secured or unsecured basis up to 100 of the borrowers required funds to close This may include the down payment closing costs prepaid expenses and discount points If the loan from the family member whether borrowed from an acceptable source or the family members own savings is secured by the subject property only the family member provider may be the note holder FHA will not approve any form of securitization of the note that results in any entity other than the family member being the note holder whether at settlement or at any time during the mortgage life cycle


8

FHA Refinances

Benefits of FHA Refinances Q streamline with or without an appraisal

Q higher LTV limits on RatefTerm refinance (up to 9775)

Q higher LTV limits on Cash out refinance

Q allows for higher Oebt-to-Income ratios

Q liberal credit requirements

New FHA Refinance Transactions guidelines per Mortgage

Letter 2011-11 See Attachment 3

FAQs on Mortgagee Letter 2011-11 See Attachment 4

FHA Refinances

UFMIP Refunds As of December 8 2004 on FHA loans where an UFMIP was paid are no longer eligible for refunds The only exception is that refunds of UFMIP premiums available to borrowers refinancing to another FHA-insured mortgage (streamline) within a tl UI)front Mortgage mlnnce Premiun Refund Percentages

Month of Year

Year 1 2 3 4 5 6 1 8 9 10 11 12

1 80 78 76 74 72 70 68 66 64 62 60 58

2 56 54 52 50 48 48 44 42 40 38 36 34

3 32 30 28 26 24 22 20 18 16 14 12 10 - - - _~-- shy __-__-shy ___ eo_

9

III

FHA Refinances

Maximum CL TV for Refinances

Rate and Tenn (or No CashmiddotOut) 9775

Refinances to borrowers in Negative Equity Position (Not eligible for Fairway Wholesale Lending) 115

FHAmiddotto-FHA Streamline with or without appraisal (Not eligible for Fairway Wholesale Lending) 125

Cash-Out 85

This refinance option is only available through December 312012

FHA Maximum Mortgage Limits

Mortgage limit for any given area shall be set at 115 of the median house price in that area set by HUD

Minimum FHA loan limit =$271050 (Conforming limit of $417000 X 65 = $271050)

See Attachment 5 - List for Illinois

Available at HUD website httpsIentphudgovidapphtmlhicost1cfm

10

FHA Mortgage Insurance Premiums

On all FHA loans Mortgage Insurance Premium (MIP) is required

upfront mortgage insurance premium (UFMIP) and annual insurance premium which is collected in monthly installments

Upfront MIP (UFMIP) Effective for loans with case numbers assigned on or after 1042010 FHA has lowered its upfront MIP to 1 for purchase money transactions and refinance transactions including J FHA-to-FHA credit qualifying refinances and J non-credit qualifying streamlined refinanced transactions (Fairway

requires a 640 minimum FICO score) Base Loan Amount X factor (1) =Upfront MIP

See Attachment 6 for FHA Mortgage Insurance Premiums Matrix


Annual Insurance Premiums An annual premium as shown in basis pOints on Attachment 4 to be remitted on a monthly basis will be charged based on the initial LTV ratio and length of the mortgage term as shown on Attachment 4

Base Loan Amount X factor divided by 12 =Monthly MIP

The Upfront MIP and Monthly MIP are always calculated on the base loan amount after the down payment The Upfront MIP (UFMIP) can be financed back into the base loan amount rounded down to the nearest $1


11

Mortgage Insurance Premiums

For Mortgages with

terms more than 15 years

terms 15 years and less and LTV

ratios of 90 and greater


ratios of 8999 and less

The annual MIP is

cancelled when the LTV ratio reaches

78 provided the borrower has paid

the annual MIP for at least five years


78 regardless of the length


FHA determines when a borrower has reached 78 LTV ratio based on the

lesser of the

Sales price or

Appraised value at origination (new appraised values will not be considered)

Example If the lesser of the sales price or appraised value is $100000 when

the loan amount reaches $78000 FHA no longer collects an annual MIP on

the loan

12


Assuming a $100000 sales price with a minimum down payment

What is the Base Loan Amount

What is the UFMIP

What is the Monthly MIP


Assuming a $100000 sales price with a minimum down payment and a 30 year fixed rate product

What is the Base Loan Amount $100000 X 965 =$96500

What is the UFMIP $96500 X 1 =$96500

3 What is the Monthly MIP $96500 X 90 divided by 12 =$7238 (Do NOT drop the cents)

Base Loan Amount + UFMIP =Total Loan Amount $96500 + $965 =$97465

13

Closing Costs and Seller Contribution Limit

Closing Costs

III Closing costs must be reasonable for services provided

III Cannot charge the borrower a Tax Service fee (it must be paid by seller or lender)

ill Can only charge ACTUAL third-party fees

Seller Contribution

III Allows 6 for interested third parties such as Sellers Real Estate Agents Builders Developers or a combination of parties

May contribute up to 6 of the propertys sales price toward the buyers actual closing costs prepaid expenses discount points Buy-down fees Upfront MIP 1st year advance payments of property taxes HOA dues all escrow items (taxes hazard insurance flood insurance) and other financing concessions


Assume a $100000 sales price a minimum down payment 30 year fixed at 475 interest and a seller contribution of $2000 towards closing costs Closing costs are $3200 Real Estates taxes are 15 of sales price Homeowners insurance is $480 annually Prepaids are calculated at 1 of sales price Remember to round down the base loan amount to the nearest $1

Base Loan Amount $ 96500 Total Loan Amount $97465

PampI 50842 Down payment $ 3500 RE taxes 12500 Closing Costs 3200 HOI 4000 Prepaids 1000 Monthly MIP 7238 Discount pOints __0

Total Cash to Close $ 7700 PITI $ 74580 Minus Seller Contribution

2000 Borrower Cash to Close $ 5700

14

Qualifying Ratios

II Standard qualifying ratios are PITI to Income of 31 (front) and Total Debt to Income of 43 (back)

II Fairway Overlay - up to 55 (back) with AUS AcceptApprove

Energy Efficient Homes (EEH) - 33 (front) and 45 (back) when borrower is purchasing or refinancing an EEH (Fairway does not allow for EEH)

Cash Reserves

II No cash reserves required for 1-2 units properties

iii Three (3) months PITI reserves required for 3-4 unit properties o Cash reserves may come from gift and secondary financing

15

Credit

Fairway Overlays

III Requires a minimum of two reported credit scores for each borrower III 640 is the minimum FICO score requirement including all streamline refinances bull Non-traditional credit is not eligible III Foreclosure

o If foreclosure was due to documentedproven hardship then If seasonedgt 36 months but = lt 84 months maximum LTV is 90 If seasonedgt or = 84 months standard down payment policies apply

o If foreclosure was due to financial mismanagement borrower must have a minimum of 84 months seasoning and re-establish credit

Judgments must be paid in full or evidence of a satisfactory repayment plan must be verified for a minimum period of 12 months Collections do not require payoff unless it is determined that the first lien position could be potentially affected by future legal action Analysis of credit history to be determined by the DE Underwriter

See Attachment 7 - HUD 41551 Chapter 4 Section C2d-e Refer to Section 402 pages 55-56 in the MRI Quick Reference Guide

Compensating Factors

Documentation Compensating factors that are used to justify approval of mortgage loans with ratios that exceed benchmark guidelines must be recorded on the Underwriter Comments section of form HUD-92900-L T FHA Loan Underwriting and Transmittal Summary Any compensating factor used to justify mortgage approval must be supported by documentation

Total Scorecard Accept Recommendation The TOTAL Scorecard Accept recommendation does not require documented compensating factors even if qualifying ratios have exceeded FHA benchmark guidelines

Benchmark Guidelines Attachment 8 (HUD 41551 Chapter 4 Section F3b) describes the compensating factors that may be used to justify approval of mortgage loans with ratios that exceed FHA benchmark guidelines


16

Bankruptcy and Credit Counseling of2

bull Chapter 7 Bankruptcy does not disqualify a borrower from obtaining an FHA-insured mortgage if at least two years have elapsed since the date of the discharge of the bankruptcy During this time the borrower must Q Have re-established good credit (no derogatory credit) or Q Chosen not to incur new credit obligations

See attached HUD 41551 Chapter 4 Section C2g

Chapter 13 Bankruptcy does not disqualify a borrower from obtaining an FHA-insured mortgage provided that the lender document that u One year of the pay-out under bankruptcy has elapsed and u The borrowers payment performance has been satisfactory u And all required payments have been made on time Note The borrower must receive written permission from the court to enter

into the mortgage transaction

Bankruptcy and Credit Counseling Page 1 of2

Total Scorecard Accept Recommendation - Lender documentation must show

two years from the discharge date of a Chapter 13 bankruptcy If the Chapter

13 bankruptcy has not been discharged for a minimum period of 2 years the

loan must be downgraded to a Refer and be evaluated by a Direct

Endorsement (DE) underwriter

For more information on the TOTAL Scorecard recommendations see the

TOTAL Mortgage Scorecard User Guide

See Attachment 9 - HUD 41551 Chapter 4 Section C2h


17


Credit Counseling does not disqualify a borrower from obtaining an FHA-insured mortgage provided that the lender document that o One year of the pay-out under the plan has elapsed and o The borrowers payment performance has been satisfactory and all required

payments have been made on time Note The borrower must receive written permission from the credit counseling

agency to enter into the mortgage transaction

See Attachment 9 - HUD 41551 Chapter 4 Section C2i






Continued on next page

18

II


Total Scorecard Accept Recommendation - The borrowers decision to participate in credit counseling does not trigger a requirement for additional documentation since the credit scores already reflect the degradation in credit history The borrowers credit history not voluntary participation in consumer credit counseling is the important variable in scoring the mortgage and thus no explanation or other documentation is needed

For more information on the TOTAL Scorecard recommendations see the TOTAL Mortgage Scorecard User Guide

See Attachment 9- HUD41551 Chapter 4 SectionC2i


Loans

Debt payments scheduled to begin or come due within 12 months of the mortgage closing must be included by the lender as antiCipated monthly obligations during the underwriting analysis

Debt payments do not have to be classimiddotfied as projected obligations if the borrower provides written evidence that the debt will be deferred to a period outside the 12-month timeframe

Refer to Section 40403 pages 60-61 in MRI Quick Reference Guide

19

Lenders may pay the borrowers allowable closing costs andor prepaid items by premium pricing Costs paid in this manner need not be included as part of the 6 seller contribution limit The funds derived from a premium priced mortgage

bull May never be used to pay any of the borrowers down payment bull Must be disclosed on the HUD-1 Settlement Statement The HUD-1 must include a

itemized statement indicating which items are being paid on the borrowers behalf disclosing a lump sum is not acceptable Also the amount paid on the borrowers behalf for each item may not exceed the allowable fee permitted by the jurisdictional HOC

lI Must be used to reduce principal if the premium pricing agreement establishes a specific dollar amount for closing costs and prepaid expenses with any remaining funds in excess of actual costs reverting to the borrower

bull May not be used for payment of debts collection accounts escrow shortages or missed mortgage payments or judgments

See Attachment 10 - HUD 41551 Chapter 5 Section A2i

Origination and Tax Service Fee

Lenders may charge and collect from the borrowers those customary and reasonable costs necessary to close the mortgage With the exception that a Tax Service Fee cannot be charged to a borrower there are no more NonshyAllowable fees and charges as long as fees are customary and reasonable and comply with Federal and State disclosure laws and other applicable laws and regulations

FHA no longer limits the origination fee to 1 of the mortgage amount for its standard mortgage insurance programs

20

Property Inspection Requirements

FHA no longer mandates automatic inspections for the following items andor conditions in existing properties

IJ Wood Destroying InsectsOrganisms Inspections required only if evidence of active infestation mandated by the state or local jurisdiction if customary to area or at lenders discretion or if requested in the Purchase and Sales Agreement

o Well (individual water system) Test or inspection required if mandated by state or local jurisdiction if there is knowledge that the well water may be contaminated when water supply relies upon water purification system due to presence of contaminants

IJ Septic Test or inspection required only if (1) evidence of system failure (2) if mandated by the state or local jurisdiction (3) if customary to the area or (4) at lenders discretion If home has been unoccupied for more than 30 days (and does not meet one of the conditions noted above) the lenders underwriter must decide if an inspection of the system is necessary

Prohibition on Property Flipping Page 1 of 4

Property Flipping - refers to the practice whereby recently acquired property is resold for a considerable profit with an artificially inflated value often abetted by a lenders collusion with an appraiser

To be eligible for a mortgage insured by FHA IJ a property must be purchased from the owner of record

o the transaction may not involve any sale or assignment of the sales contract and

o the lender must obtain and submit in the case binder to HUD documentation verifying that the seller is the owner of record

Such documentation may include but not limited to

IJ a property sales history report

o a copy of the recorded deed from the seller or

o Other documentation such as a copy of the property tax bill title commitment or binder demonstrating the seller(s)owner(s) ownership of the property and the dates it was acquired

Note This requirement applies to all FHA purchase money mortgages regardless of the time between re-sales

21

i

I Prohibiti~n on Property Flipping Page 2 of 4

If a property is re-sold 90 days or fewer following the date of acquisition by the seller the property is not eligible for a mortgage insured by FHA

FHA defines the o sellers date ofacquisition as the date of settlement on the sellers purchase of that

property and

o resale date as the date of execution of the sales contract by a buyer intending to finance the property with an FHA-insured loan

A lender must obtain a second appraisal by another appraiser if

o The resale date of the property is between 91 and 180 days following the acquisition of the property by the seller and

o The resale price is 100 percent or more over the price paid by the seller when the property was acquired

Note The cost of the second appraisal may NOT be charged to the borrower

--------__-shy Prohibitio~n Proper~ Flipping

Page 3 of 4

FHA reserves the right to require additional documentation from a lender to support the resale value of the property if (J The resale date is more than 90 days after the date of acquisition by the seller but

before the end of the twelfth month following the date of acquisition and

(J The resale price is 5 percent or greater than the lowest sale price of the property during the preceding 12 months

At FHAs discretion such documentation may include but not limited to an appraisal from another appraiser

The only exceptions to the 90 day resale restriction are for

o properties acquired by an employer or relocation agency in connection with the relocation of an employee

(J re-sales by HUD under the Real Estate Owned (REO) program

(J sales by other United States Government agencies of single family properties pursuant to programs operated by these agencies

22


D sales of properties by nonpro-fits approved to purchase HUD owned single family properties at a discount with the resale restrictions

D sales of properties that are acquired by the seller by inheritance D sales of properties by state and federally-chartered financial institutions and

government sponsored enterprises D sale of properties by local and state government agencies and D sales of properties within Presidentially Declared Disaster Areas

Any subsequent re-sales of the properties described above must meet the 90 day threshold in order for the mortgage to be eligible as security for FHA insurance


See Attachment 11- HUD 41552 Section 47a-h

How do I stay informed and Get the Answers I need

You can subscribe to Mortgage References Inc (MRI) Quick Reference Guide We feel that this is the best FHA reference guide in the industry Please see Attachment 12 - MRI order form

httpwwwhudgovofficeshsgsfhrefhsgregstcfm Here you can subscribe to the FHAs Single Family Housing Industry Email List Please see Attachment 12 - Screen shot

httpwwwfhaoutreachgovFHAFAQI Many questions posed to the FHA Resource Center are answered here There are over 1200 questions and answers in the FHA online knowledge base from the very basic eligibility questions to technical underwriting and appraisal questions Please see Attachment 12 - Screen shot

23


httpwwwallregscom We recommend subscribing to Allregs FREE email alert service for lending industry update notices Please see Attachment 12 - Screen shot

wwwadfinetcom We highly recommend this FREE regulations search engine Please see Attachment 12 - Screen shot

Email jerroldhmayerhudgov How do you sign up yourself as well as your entire staff for FHA email updates It is easy just list email addresses like this

xxxabccom

yyyabccom

zzzabccom

You can send one email or thousands Email your list to jerroldhmayerhudgov


httpportalhudgovportalpageportaIHUDgroupslenders FHAs Lender Partner Resource Center Please see Attachment 12 - Screen shot

httpwwwhudgovofficesadmhudclips Search site for Handbooks Forms and Mortgagee Letters Please see Attachment 12 - Screen shot

III httpwwwhudgovofficeshsgkeywordscfm Keyword Search Index Please see Attachment 12 - Screen shot

111 httpwwwhudgovassistlsiteindexcfm Site Search Index Please see Attachment 12 - Screen shot

24

do I stay informed and Get the Answers I need

httpwwwfhaoutreachgovFHAHandbookprodindexasp FHA Online Handbooks Please see Attachment 12 - Screen shot

Email infofhaoutreachcom You can email the FHA Resource Center for answers to many questions you may have

Call (800) CALL-FHA or (800) 225-5342 FHA Resource Center available Monday-Friday 8 AM to 8 PM Eastern Time

httpwwwhudgovofficesladmhudclipshandbookshsgh41551 141551 HSGHpdf The 41551 is the official 406 page Mortgage Credit Analysis Handbook for FHA

For quicker access to FHA questions the MRI Quick Reference Guide is a better alternative See Attachment 12 for order form


FHA TOTAL Mortgage Scorecard User Guide - Please see Attachment 13 for a copy

FHA TOTAL Mortgage Scorecard FAQs - Please see Attachment 14 for a copy

III

25

I FHA-Documentation Checklist FHA For~s and Fairway Specific Forms

IiI FHA Documentation Checklist (for training purposes only) and copy of Loan Submission Form Please see Attachment 15 for documents

FHA Mortgage Insurance Premiums - Please see Attachment 6

FHA Specific Forms Product Guidelines and Matrices - Please see Attachment 16

26

Why choose an FHA loan

Many homebuyers today either do not have sufficient cash-to-close or they do not meet the qualifying guidelines for conventional financing FHA is more lenient and forgiving when a borrower has credit issues They also allow the borrower to have more acceptable sources of down payment and monthly income as well as higher qualifying ratios

HUD was created to help low-moderate income families It has evolved today for

First-time home buyers

Borrowers with minimum established credit

Families who have had some credit problems but have overcome their problems and are now credit-worthy

Fairways FHA sponsorship requirements

No audited financial statements required for 2010 and beyond

II Self prepared financial statements acceptable

II Only a $25000 minimum net worth required or state requirement whichever is greater

II Sole Proprietors and Partnerships and LLCs with one ownermember

Home office allowed

iii A four (4) hour FHA Loan Origination training course is required for brokerpartners with little or no FHA lending experience

2

Definitions

Lender =Broker






3


Eligible Borrowers







Military Personal



4

III













5


Transaction Type

III Purchase




Cash-Out Refinance

Second Home

Investment Property


Maximum LTV


III 9775



850

Ineligible

Ineligible








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6












7













8

FHA Refinances









FHA Refinances


Month of Year

Year 1 2 3 4 5 6 1 8 9 10 11 12

1 80 78 76 74 72 70 68 66 64 62 60 58

2 56 54 52 50 48 48 44 42 40 38 36 34

3 32 30 28 26 24 22 20 18 16 14 12 10 - - - _~-- shy __-__-shy ___ eo_

9

III

FHA Refinances





Cash-Out 85







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11


For Mortgages with






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12




What is the UFMIP








13


Closing Costs




Seller Contribution









14

Qualifying Ratios




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15

Credit

Fairway Overlays











16
















17

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26

Definitions

Lender =Broker






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Eligible Borrowers







Military Personal



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III













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Cash-Out Refinance

Second Home

Investment Property


Maximum LTV


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Ineligible

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6












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8

FHA Refinances









FHA Refinances


Month of Year

Year 1 2 3 4 5 6 1 8 9 10 11 12

1 80 78 76 74 72 70 68 66 64 62 60 58

2 56 54 52 50 48 48 44 42 40 38 36 34

3 32 30 28 26 24 22 20 18 16 14 12 10 - - - _~-- shy __-__-shy ___ eo_

9

III

FHA Refinances





Cash-Out 85







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11


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8

FHA Refinances









FHA Refinances


Month of Year

Year 1 2 3 4 5 6 1 8 9 10 11 12

1 80 78 76 74 72 70 68 66 64 62 60 58

2 56 54 52 50 48 48 44 42 40 38 36 34

3 32 30 28 26 24 22 20 18 16 14 12 10 - - - _~-- shy __-__-shy ___ eo_

9

III

FHA Refinances





Cash-Out 85







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For Mortgages with






The annual MIP is








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12




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Qualifying Ratios




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Credit

Fairway Overlays











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6












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8

FHA Refinances









FHA Refinances


Month of Year

Year 1 2 3 4 5 6 1 8 9 10 11 12

1 80 78 76 74 72 70 68 66 64 62 60 58

2 56 54 52 50 48 48 44 42 40 38 36 34

3 32 30 28 26 24 22 20 18 16 14 12 10 - - - _~-- shy __-__-shy ___ eo_

9

III

FHA Refinances





Cash-Out 85







10












11


For Mortgages with






The annual MIP is








lesser of the

Sales price or




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12




What is the UFMIP








13


Closing Costs




Seller Contribution









14

Qualifying Ratios




Cash Reserves



15

Credit

Fairway Overlays











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FHA Refinances









FHA Refinances


Month of Year

Year 1 2 3 4 5 6 1 8 9 10 11 12

1 80 78 76 74 72 70 68 66 64 62 60 58

2 56 54 52 50 48 48 44 42 40 38 36 34

3 32 30 28 26 24 22 20 18 16 14 12 10 - - - _~-- shy __-__-shy ___ eo_

9

III

FHA Refinances





Cash-Out 85







10












11


For Mortgages with






The annual MIP is








lesser of the

Sales price or




the loan

12




What is the UFMIP








13


Closing Costs




Seller Contribution









14

Qualifying Ratios




Cash Reserves



15

Credit

Fairway Overlays











16
















17












18

II






Loans




19










20
















21

i




property and







Page 3 of 4









22












23





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III

25





26












7













8

FHA Refinances









FHA Refinances


Month of Year

Year 1 2 3 4 5 6 1 8 9 10 11 12

1 80 78 76 74 72 70 68 66 64 62 60 58

2 56 54 52 50 48 48 44 42 40 38 36 34

3 32 30 28 26 24 22 20 18 16 14 12 10 - - - _~-- shy __-__-shy ___ eo_

9

III

FHA Refinances





Cash-Out 85







10












11


For Mortgages with






The annual MIP is








lesser of the

Sales price or




the loan

12




What is the UFMIP








13


Closing Costs




Seller Contribution









14

Qualifying Ratios




Cash Reserves



15

Credit

Fairway Overlays











16
















17












18

II






Loans




19










20
















21

i




property and







Page 3 of 4









22












23





xxxabccom

yyyabccom

zzzabccom







24










III

25





26













8

FHA Refinances









FHA Refinances


Month of Year

Year 1 2 3 4 5 6 1 8 9 10 11 12

1 80 78 76 74 72 70 68 66 64 62 60 58

2 56 54 52 50 48 48 44 42 40 38 36 34

3 32 30 28 26 24 22 20 18 16 14 12 10 - - - _~-- shy __-__-shy ___ eo_

9

III

FHA Refinances





Cash-Out 85







10












11


For Mortgages with






The annual MIP is








lesser of the

Sales price or




the loan

12




What is the UFMIP








13


Closing Costs




Seller Contribution









14

Qualifying Ratios




Cash Reserves



15

Credit

Fairway Overlays











16
















17












18

II






Loans




19










20
















21

i




property and







Page 3 of 4









22












23





xxxabccom

yyyabccom

zzzabccom







24










III

25





26

FHA Refinances









FHA Refinances


Month of Year

Year 1 2 3 4 5 6 1 8 9 10 11 12

1 80 78 76 74 72 70 68 66 64 62 60 58

2 56 54 52 50 48 48 44 42 40 38 36 34

3 32 30 28 26 24 22 20 18 16 14 12 10 - - - _~-- shy __-__-shy ___ eo_

9

III

FHA Refinances





Cash-Out 85







10












11


For Mortgages with






The annual MIP is








lesser of the

Sales price or




the loan

12




What is the UFMIP








13


Closing Costs




Seller Contribution









14

Qualifying Ratios




Cash Reserves



15

Credit

Fairway Overlays











16
















17












18

II






Loans




19










20
















21

i




property and







Page 3 of 4









22












23





xxxabccom

yyyabccom

zzzabccom







24










III

25





26

III

FHA Refinances





Cash-Out 85







10












11


For Mortgages with






The annual MIP is








lesser of the

Sales price or




the loan

12




What is the UFMIP








13


Closing Costs




Seller Contribution









14

Qualifying Ratios




Cash Reserves



15

Credit

Fairway Overlays











16
















17












18

II






Loans




19










20
















21

i




property and







Page 3 of 4









22












23





xxxabccom

yyyabccom

zzzabccom







24










III

25





26












11


For Mortgages with






The annual MIP is








lesser of the

Sales price or




the loan

12




What is the UFMIP








13


Closing Costs




Seller Contribution









14

Qualifying Ratios




Cash Reserves



15

Credit

Fairway Overlays











16
















17












18

II






Loans




19










20
















21

i




property and







Page 3 of 4









22












23





xxxabccom

yyyabccom

zzzabccom







24










III

25





26


For Mortgages with






The annual MIP is








lesser of the

Sales price or




the loan

12




What is the UFMIP








13


Closing Costs




Seller Contribution









14

Qualifying Ratios




Cash Reserves



15

Credit

Fairway Overlays











16
















17












18

II






Loans




19










20
















21

i




property and







Page 3 of 4









22












23





xxxabccom

yyyabccom

zzzabccom







24










III

25





26




What is the UFMIP








13


Closing Costs




Seller Contribution









14

Qualifying Ratios




Cash Reserves



15

Credit

Fairway Overlays











16
















17












18

II






Loans




19










20
















21

i




property and







Page 3 of 4









22












23





xxxabccom

yyyabccom

zzzabccom







24










III

25





26


Closing Costs




Seller Contribution









14

Qualifying Ratios




Cash Reserves



15

Credit

Fairway Overlays











16
















17












18

II






Loans




19










20
















21

i




property and







Page 3 of 4









22












23





xxxabccom

yyyabccom

zzzabccom







24










III

25





26

Qualifying Ratios




Cash Reserves



15

Credit

Fairway Overlays











16
















17












18

II






Loans




19










20
















21

i




property and







Page 3 of 4









22












23





xxxabccom

yyyabccom

zzzabccom







24










III

25





26

Credit

Fairway Overlays











16
















17












18

II






Loans




19










20
















21

i




property and







Page 3 of 4









22












23





xxxabccom

yyyabccom

zzzabccom







24










III

25





26
















17












18

II






Loans




19










20
















21

i




property and







Page 3 of 4









22












23





xxxabccom

yyyabccom

zzzabccom







24










III

25





26












18

II






Loans




19










20
















21

i




property and







Page 3 of 4









22












23





xxxabccom

yyyabccom

zzzabccom







24










III

25





26

II






Loans




19










20
















21

i




property and







Page 3 of 4









22












23





xxxabccom

yyyabccom

zzzabccom







24










III

25





26










20
















21

i




property and







Page 3 of 4









22












23





xxxabccom

yyyabccom

zzzabccom







24










III

25





26
















21

i




property and







Page 3 of 4









22












23





xxxabccom

yyyabccom

zzzabccom







24










III

25





26

i




property and







Page 3 of 4









22












23





xxxabccom

yyyabccom

zzzabccom







24










III

25





26












23





xxxabccom

yyyabccom

zzzabccom







24










III

25





26





xxxabccom

yyyabccom

zzzabccom







24










III

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III

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Handouts

Education

Transcript of Handouts