FHA MANUFACTURED HOME GUIDELINES

Transcription

1 PRODUCT DESCRIPTION 30 year Fixed Rate PRODUCT CODE FHA30-MF (30 year Fixed Rate Manufactured Home Conforming Loan) FHA30-MFHP (30 year Fixed Rate Manufactured Home Higher Priced Mortgage Loan) QUALIFYING RATE AND RATIOS Maximum qualifying ratios of 35%/48% with AUS Approve/Accept AND FICO 680 and above Maximum qualifying ratios of 31%/43% with AUS Approve/Accept AND FICO TYPES OF FINANCING Purchase Rate and Term Refinance o Must be off market a minimum of 90 days prior to the application date 203(k) loans NOTE: In addition to these guidelines, refer to the applicable FHA 203(k) Standard or FHA 203(k) Streamlined Guidelines for all 203(k) product guideline requirements Cash-Out Refinances are ineligible Streamline Refinances are ineligible Temporary Buydowns are ineligible MAX LOAN AMOUNT Maximum Base Loan Amount cannot exceed the FHA Statutory Mortgage Limits for each county and the Base Loan Amount may not exceed $417,000 LTV/CLTV Purchase o 96.5% LTV/CLTV Rate/Term Refinance o 97.75% LTV/CLTV SECONDARY FINANCING Secondary financing is not allowed Page 1 of 9 Rev. 10/24/13

2 PROPERTY TYPES Eligible Properties o Double wide and multi-wide only o May be located on an individual lot, in a subdivision or PUD o The land must be owned by the borrower in fee simple o Existing construction only. Must be permanently installed on the site for one year or more prior to the date of the mortgage application. Ineligible Properties o Single wide o Manufactured Housing Condominium Projects o Leasehold o New construction (initial sale from dealer or when home has been permanently erected on the site for less than one year prior to the date of the mortgage application). o Construction to Permanent loans o HUD REO o Properties with resale or deed restrictions OCCUPANCY Primary Residence only UNDERWRITING Must adhere to FHA guidelines and Platinum Policies located in the Correspondent Seller Guide All loans must be scored thru FHA TOTAL Scorecard and receive Approve/Accept recommendation from DU or LP All loan data submitted to AUS for Approve/Accept Finding must be accurate and validated AUS documentation waivers are NOT eligible. Income, assets and credit must be documented using Full/Alt doc as detailed in the FHA Handbook All loans must meet FHA guidelines and eligibility requirements, as well as credit, capacity and documentation requirements in addition to items listed in these guidelines AUS Refer and manually underwritten loans are ineligible Loans requiring a manual downgrade from a TOTAL Scorecard Approve/Eligible are ineligible o If credit report reveals or indicates that borrower is disputing any credit accounts, collections or public records the loan is ineligible BORROWER ELIGIBILITY All borrowers (including permanent and non-permanent resident aliens) must have a valid social security number Permanent Resident Aliens o Copy of the Alien Registration Receipt Card (Resident Alien card), I-551 (front & back) Non-Permanent Resident Aliens o Borrower must be eligible to work in the U.S. Copy of valid eligible visa and unexpired passport Copy of the valid Employment Authorization Card, I-766, with history of renewal NOTE: A social security card is not acceptable as evidence of work status Page 2 of 9 Rev. 10/24/13

3 CO-BORROWERS Use of Non-Occupying co-borrower(s) for qualifying is ineligible CREDIT Must adhere to FHA guidelines and Platinum Policies located in the Correspondent Seller Guide AUS documentation waivers are NOT eligible. Income, assets and credit must be documented using Full/Alt doc as detailed in the Minimum FICO Score Requirements: o Minimum 660 FICO for each borrower with maximum 31%/43% ratios o Minimum 680 FICO for each borrower with maximum 35%/48% ratios o Non-traditional credit or insufficient credit is ineligible Tradeline Requirements: o At least 3 satisfactory tradelines reporting for a minimum of 12 months. All 3 tradelines do not have to open and active, but require activity in most recent 24 months. NOTE: authorized user and co-signed accounts are not eligible for inclusion in tradeline requirement unless acceptable documentation provided to evidence borrower has made the last 12 consecutive monthly payments o Non-traditional credit is not allowed to meet 3 tradeline requirement o 12 month satisfactory VOR/VOM required reporting no late payments in last 12 months. If landlord is a management company, VOR or credit supplement is acceptable. If landlord is a private party, 12 months canceled checks required. If borrower does not have a documented housing payment, refer to additional reserve requirements in Asset section of guidelines o No more than 1x30 day late payments in the most recent 12 months on installment debt, but none in the last 180 days o No more than 2x30 day late payments in the most recent 12 months on revolving debt, but none in the last 180 days o No charge-offs or judgments in the most recent 12 months o No collections for housing or utilities (gas, electric, water) in most recent 12 months o Disputed accounts (either paid in full or with an unpaid balance) are ineligible. All disputed accounts must be cleared from the borrower s credit report and new credit report obtained. New credit report must be submitted through TOTAL Scorecard. o All adverse credit within last 24 months addressed by borrowers. Letter must be written and signed by borrower. o All major derogatory credit, judgments, collections, etc., reported to be addressed by borrowers. Letter must be written and signed by borrower. o All inquiries to be addressed by borrowers. Letter must be written and signed by borrower o No paying off or paying down debt to qualify- this includes revolving and installment debt. Page 3 of 9 Rev. 10/24/13

4 CREDIT (continued) Collections o If the cumulative outstanding balance of all collection accounts is equal to or greater than $2,000, a capacity analysis is required. o Capacity analysis includes one of the following actions: Payment in full of the collection accounts, prior to or at the time of loan closing, along with documentation of acceptable source of funds; or Borrower makes payment arrangement with the creditor, and provides documentation to support proof of arrangement and payment to be included in DTI; or If verification of the payment cannot be obtained, 5% of the outstanding balance of each collection account must be included as a monthly payment in DTI o Collection accounts of a non-purchasing spouse in a community property state are included in the cumulative balance unless excluded under state law. o The borrower cannot pay down collection accounts to below $2,000 to preclude the capacity analysis required. NOTE: Medical collections and charge offs are excluded from the above guidance. Judgments o Judgments must be paid off prior to closing. An exception may be granted if the borrower has a payment arrangement with the creditor to make regular and timely payments. Document file with copy of payment agreement and a minimum of 3 months of scheduled payments have been made prior to credit approval. Borrowers may not pre-pay the scheduled payments to qualify. Monthly payment must be included as a monthly payment in DTI o Judgments of non-purchasing spouse in community property state must be paid in full or meet above exception Bankruptcy o Chapter 7 Must be discharged/dismissed for 4 years Cannot have any housing delinquency or new derogatory credit related public record since discharge o Chapter 13 Must be discharged/dismissed for 2 years Cannot have any housing delinquency or new derogatory credit related public record since discharge Foreclosure, Deed in Lieu or Short Sale o 7 years elapsed since completion of Foreclosure, Deed in Lieu or Short Sale Page 4 of 9 Rev. 10/24/13

5 ASSETS/RESERVES Must adhere to FHA guidelines and Platinum Policies located in the Correspondent Seller Guide AUS documentation waivers are NOT eligible. Income, assets and credit must be documented using Full/Alt doc as detailed in the Assets to be documented with VOD and 30 day bank statement with no overdrafts OR 60 days bank statements with previous and current balance with no overdrafts. Gifts o Follow FHA guidelines NOTE: Donor s ability must be documented Reserves (must be self-accumulated by the borrower) o Reserves as required by DU o If payment shock %, minimum 2 months reserves required o If payment shock exceeds 100%, minimum 3 months reserves required OR minimum 10% down payment required DOWN PAYMENT ASSISTANCE Ineligible INTERESTED PARTY CONTRIBUTIONS Maximum up to 6% Seller contributions limited to discount points, seller paid closing costs, prepaid expense, UFMIP (entire amount) INCOME Must adhere to FHA guidelines and Platinum Policies located in the Correspondent Seller Guide AUS documentation waivers are NOT eligible. Income, assets and credit must be documented using Full/Alt doc as detailed in the If any borrower is working for a temporary agency, a minimum of 24 months work history is required with the temporary agency in order to consider income for qualification Verbal Verification of Employment o Must be completed within 10 business days prior to note date for all salaried borrowers o Must be completed within 30 days prior to the note date for all self-employed borrowers o Borrowers in the military may provide a military Leave and Earnings Statement dated within 30 days prior to the note date in lieu of a verbal verification of employment NOTE: Platinum will re-verify prior to purchase A completed and signed initial IRS Form 4506-T for each borrower on loan is required and the 2 most recent years validated tax transcripts Page 5 of 9 Rev. 10/24/13

6 APPRAISAL REQUIREMENTS Must adhere to FHA guidelines and Platinum Policies located in the Correspondent Seller Guide Appraisal must be completed on FNMA Form 1004C (Manufactured Home Appraisal Report) and comply with FHA appraisal guidelines for manufactured home. Must comply with the FHA Appraisal Independence Policy Condition Rating of C5/C6 or a Quality Rating of Q6 is ineligible Appraised value must be supported by 3 closed sale comps and 2 pending sale/listing comps. A minimum of 2 closed sales and 1 pending sale/listing must be manufactured homes. Flips less than 91 days are ineligible Flips greater than 90 days are eligible if sales price increase is less than 20%. Refer to Property Flip Policy for requirements. Must conform to all applicable use restrictions and must be zoned for residential use, and not commercial or business uses. Must be permanently connected to a sewage disposal system such as a public sewer or a septic tank, and to other utilities that meet local, State and federal requirements The square footage and room dimensions must be acceptable to typical purchasers in the market area The appraiser must note the location of the HUD Seals and note the manufactured unit's label numbers from the HUD Seals on the appraisal report. The appraiser must provide photos of HUD Seals and photo of HUD Data Plate. ESCROW HOLDBACKS Ineligible MORTGAGE INSURANCE Follow FHA guidelines MAX PROPERTIES Borrower(s) cannot own other real estate NOTE: Exceptions to this guideline must be pre-approved by Correspondent Underwriting CAIVRS, LDP & GSA SEARCH Document the results on the FHA Loan Underwriting & Transmittal Summary (LT) A copy of the FHA Connection screen results for all searches must be in the loan file CAIVR System o Access FHA Connection to check CAIVRS for all borrowers on the transaction: borrowers, co-borrowers and co-signors, if applicable If the name of any party to the transaction appears on any of the lists below, the loan is not eligible o Limited Denials of Participation (LDP) List Examine/Search the list for all parties to the transaction: all borrowers including AKAs, sellers, listing and selling real estate agents and loan officer. o Government Services Administration's (GSA) Lists of Parties Excluded from Procurement for Non-Procurement Programs Examine/Search the list for all parties to the transaction: all borrowers including AKAs, sellers, listing and selling real estate Page 6 of 9 Rev. 10/24/13

7 REQUIREMENTS Must be a 1-unit dwelling comprised of multiple sections ("double-wide or multi-wide"), Must be at least 12 feet wide and have a minimum of 700 square feet of gross living area. Must be constructed after June 15, 1976, in conformance with the Federal Manufactured Home Construction and Safety Standards, as evidenced by an affixed certification label The property must be classified and taxed as real estate The finished grade beneath the home is at or above the 100-year flood elevation The mortgage must cover both the manufactured unit and its site and shall have a term of not more than 30 years from the date amortization begins Must be built on a permanent chassis in compliance with the National Manufactured Construction and Safety Standards Act by the Department of Housing and Urban Development (HUD). The wheels, axels, and towing hitches must be removed from the manufactured home The unit must not have been installed or occupied previously at another location. Manufactured units may be moved only from the manufacturer's or dealer's lot to the site on which the unit will be insured. If a permanent foundation is to be constructed under an existing eligible unit, the unit may be jacked up in order to install a new foundation and subject to final inspection HUD CERTIFICATION LABELS/SEALS AND DATA PLATES A HUD Certification Label "HUD Seal" must be permanently affixed to each section of the Manufactured Home evidencing compliance with Federal Manufactured Home Construction and Safety Standards. The HUD label numbers appear on the HUD seals. If for any reason the labels are missing, the property is unacceptable. In some states a manufactured home may not be re-sold if missing a label. HUD does not re-issue labels for manufactured homes. The HUD Seal is affixed to the outside of the home near the tail light end of each transportable section of the home. To be eligible for FHA financing, each section of the home must have a HUD Certification Label "HUD Seal". The HUD data plate is different from the HUD Seals. The HUD data plate is located in one of three locations; on the main electrical panel, on a kitchen cabinet or in a bedroom closet. In states where resale without a HUD seal is permissible, HUD has authorized the Institute for Building Technology and Safety (IBTS) to issue letters of label verification for units for which it can locate the necessary information within its data base. A customer may request a letter of label verification from IBTS by visiting the IBTS website and completing an online request form or submitting the request form via fax at: The information needed by IBTS to issue a letter of label verification can be found on the above website and will generally appear on the data plate. Page 7 of 9 Rev. 10/24/13

8 FOUNDATION COMPLIANCE An Engineer's Certification on Foundation Compliance must be: o Completed by a licensed professional engineer or registered architect, who is licensed/registered in the state where the manufactured home is located; AND o Be site specific and contain the engineer's or registered architect s signature, seal, and/or state license/certification number. In states where seals are issued, the seal must be on the certification A structural engineer must certify the foundation complies with FHA guidelines currently published in the HUD Handbook - Permanent Foundations Guide for Manufactured Housing. Including foundation system meets the soil conditions of the site; Foundations and footings are appropriate to the manufactured unit, the site and weather conditions of the area. Must be affixed to a permanent foundation for the site conditions, home design features, and the loads the home was designed to withstand in accordance with the manufacturer's instructions or a design by a licensed (registered) professional engineer. The foundation must meet all local, State or federal codes, as applicable. The stabilizing devices must comply with the manufacturer's design or a design by a licensed (registered) professional engineer. Stabilizing devices refer to all components of the anchoring assemblies, and any other equipment, materials, and methods of construction that support and secure the Manufacture Home to the ground. Any additions or structural modifications to an existing Manufactured Home must be approved by a licensed professional engineer or the local, State or federal authority. The inspection report must certify that the structural changes or additions to the property were made in accordance with the HUD Manufactured Home Construction Safety Standards (MHCSS) and the applicable building codes of the local jurisdiction. If the current owner of a manufactured home has an acceptable engineer's certification that the permanent foundation meets HUD requirements, the lender may re-use the certification for a new buyer of the home, provided that there have been no alterations or additions to the home since the certification was issued by the engineer. The appraisal should note if any alterations or additions to the manufactured home have been made. SKIRTING The space beneath manufactured homes must be properly enclosed. The perimeter enclosure shall be a continuous wall (whether bearing or non-load bearing) that separates the crawl space from backfill, and keeps out vermin and water. The enclosure must be adequately secured to the perimeter of the unit and allow for proper ventilation of crawl space. If the perimeter enclosure is non-load bearing skirting comprised of lightweight material, there must be adequate backing (such as: concrete, masonry, or treated wood) to permanently attach and support or reinforce the skirting. Non-structural vinyl skirting (the typical application in manufactured housing) does not meet the above requirements. However, a crawl space enclosure properly designed to meet the above requirements that uses vinyl siding as an exterior cover only, is acceptable. CASE NUMBER All files are required to have a case number and must be entered into AUS for valid findings Case numbers are attached to property addresses and only 1 case number can be assigned to a specific property at a time Ordering case numbers o Section of the Act is 203(b) o Case Number Assignment Screen, must contain the appropriate two-digit Program ID Code: 77 for manufactured housing loans not processed as construction-permanent loans. Appraisal Logging Screen, must contain the Manufactured Housing indicator. Key in Y for Yes. Page 8 of 9 Rev. 10/24/13

9 COMMUNITY PROPERTY STATES Non-Purchasing Spouse in a community property state: If property is located in a community property state, or the borrower resides in a community property state, the following requirements apply: o A credit report for the non-purchasing spouse is required to determine any joint or individual debts. The spouse s authorization to pull a credit report must be obtained. Even if the non-purchasing spouse does not have a social security number, the credit reporting company needs to order a credit report with the non-purchasing spouse s name, address, & DOB. Social Security number must be left blank. The credit reporting company should verify that the non-purchasing spouse has no credit history and no public records recorded against him/her Credit Company should be given non-purchasing spouse information: Name(s), address, birth date and any other significant information requested in order to do the records check o The debts of the non-purchasing spouse must be considered in the qualifying ratios o All defaulted federal debt, open judgments and liens, including those of the non-purchasing spouse, must be satisfied prior to or at closing Credit history of the non-purchasing spouse should not be the basis for declining the loan OTHER INSPECTIONS Wood Destroying Insects/Organism Requirements o FHA no longer mandates automatic inspections. Inspections are required if: Evidence of active infestation and/or termite damage Mandated by the state of local jurisdiction Customary to the area Required per sales contract Lender discretion Well and/or Septic Requirements o Inspections are required if: Appraiser notes a problem Mandated by the state of local jurisdiction Customary to the area Required per sales contract Lender discretion Property has been vacant for an extended period of time (generally in excess of 30 days) HIGHER PRICED MORTGAGE GUIDELINES (FHA30-MFHP) Must be locked under product code: FHA30-MFHP Higher-Priced Mortgage Loan Disclosure MUST be signed as part of the application documents Must pass all high cost tests, including but not limited to Agency, City, County, State & Federal. Validation of the borrower s ability to repay through verification of income, liabilities and assets in accordance with full documentation requirements PRICING/RATES/LOCKS Refer to Platinum Correspondent website for daily pricing and pricing policies. Page 9 of 9 Rev. 10/24/13