Transcript Document
CHDAP 2nd Trust Deeds
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7/20/2015
The CHDAP 2nd Trust Deed
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FHA 1st TD at 96.5%
Combine with a CHDAP
3% 2nd TD
This program can only be done with an
FHA – 30 year fixed.
After 2nd, it leaves only a .50% down
payment – and this can be a gift.
Can be used with a FLIP loan.
No payments on the 2nd; deferred for
the life of the 1st loan.
The 2nd is due and payable when certain
events occur……
CLTV cannot exceed 103%
Term on 2nd needs to match term of 1st,
not to exceed 30 years.
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What is a first time homebuyer?
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A first time homebuyer is defined as someone who has not
had any ownership in a primary residence within the last
three years (timeshares okay and n/o/o okay if currently
renting – and not from a family member).
Federal income tax returns required for the previous 3
years. Borrowers not legally obligated to file must complete
Tax Return Affidavit.
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CHDAP 2nds
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Must be a first time home buyer
FHA 1st Trust Deed 96.5% financing
CHDAP 3% 2nd; deferred payments
The 2nd can be used for down payment or closing costs
.50% can be a gift
640 FICO requirement
45% max ratio
1st Time Homebuyer – no primary ownership in 3 yrs.
Borrower’s income can not exceed the CalHFA published income limits.
Only calculate the purchasing borrower’s income to qualify for the loan.
Non-0ccupant co-signers okay (see next slide); No non-occupant co-borrower;
You can use an MCC with this product, but it can not be used to reduce the ratios.
Homebuyer Education is required – MGIC can be a source.
SFR’s, condos, and PUDS (no 2-4 units)
Five acres maximum; no income producing; hobby okay.
If garage has been converted, no stove allowed – gas needs to be capped; no 2nd kitchen.
Home Warranty not required.
DU or LP approvals.
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CHDAP
Co-signers
Helps with the ratios of
45% maximum.
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Additional Co-Signer Requirements
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Cosigners may not have a financial interest in the transaction (seller,
builder, real estate agent, MLO, etc., are ineligible).
Co signers must be closely related to the occupying borrowers.
Allowable relatives are parents, children, siblings, stepchildren,
aunts/uncles, nieces/nephews ONLY. Lexis-Nexis to show family
relationship and/or additional documentation may be required by
underwriting.
Cosigners must have a principal residence in the US exempted due to
military service or as US citizens living abroad.
Occupant borrower’s debt to ratios cannot exceed 46.99/56.99%.
Total DTI including co-signer’s income is 45%.
Full credit packages will be required for Cosigners (credit reports, full
income documentation and asset documentation, full disclosures in
accordance with FHA and total scorecard requirements).
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Lender vs. CALHFA Review of Income
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Notes of Interest on how CalHFA calculates maximum income for
family or anyone who is living in the house – not just borrowers .
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Schedule C or E Income – do not add back in
depreciation.
Negative is a wash, not deducted.
Do not back out 2106 expenses.
2013 and YTD income (no 2012 income is reviewed
since we are in 2014).
P&L’s are okay for 2014.
In question, CalHFA will always take the higher
income.
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CHDAP Program “Loan Amount” Limits:
For a complete list of sale prices, go to:
http://www.calhfa.ca.gov/homeownership/limits/index.htm#income
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CHDAP INCOME LIMITS
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CHDAP INCOME LIMITS
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CHDAP Income Limits
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CalHFA CHDAP Submission Check List
All these Forms can be found at essexwholesale.com under Forms and Documents
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OTHER THINGS TO KNOW:
___We will require 2 packages to be uploaded; the
1st and the 2nd; with 2 separate loan numbers.
___The 1st mortgage – submit by using your FHA
Required Submission Forms list; exception CalHFA
requires 3 years tax returns on all borrowers.
2nd:
___ GFE & TiL on the
$250.00 origination fee
in Box 1 which will go to Essex Mortgage.
No other fees can be charged on the 2nd.
Once a complete package is approved by Essex
Mortgage, your file will be submitted to Agency for
approval; turn times vary. Please check with your
AE.
Prior Agency approval is required to locking your
loan.
Additional Forms:
___Borrower(s) Certificate of Completion of
Homebuyers Education Counseling – for all
borrowers and from acceptable source.
___Military Service Questionnaire – Borrower(s) to
complete, sign and date.
___CalHFA Tax Return Affidavit – Only for
borrowers not required to file 1040’s.
___Borrower Affidavit of Household Size
___Borrower(s) Certification and & Authorization
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When you add an CalHFA MCC to the CHDAP
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When multiple CalHFA loan programs are used in combination, the
most restrictive income limits apply (such as combining with an
CalHFA MCC Tax Credit – the tax credit can not be used for credit
qualifying).
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