<logo> Offered through 21 st Century Home Loans WHOLESALE DIVISION

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1 <logo> CHF ACCESS Training Offered through 21 st Century Home Loans WHOLESALE DIVISION 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.

2 Today s Challenges Seller paid DAPs discontinued (Nehemiah, etc.) More restrictive guidelines/products Slow market Struggling Economy Maxed out sellers Over $7.2 Billion in 1 st & 2 nd loan financing since 1993 (53,000 properties) Higher cost of living = Less money to save

3 What CHF ACCESS offers 1 st Loan 2 nd Loan Home Ownership FHA up to 96.50% LTV VA available to 100% LTV - Must be approved for VA through 21 st Century Home Loan 15-Year Fully Amortized 2 nd Up to 3% of Sales Price CLTV up to 99.50% LITTLE TO NO MONEY OUT OF POCKET

4 CHF ACCESS PROGRAMS Eligible 1 st Mortgage Program Down Payment & Closing Cost Assistance Sample Calculations Income Limit Calculation

5 CHF Access 1 st & 2 nd

6 CHF ACCESS Program Topic State Restriction Program Types Program Description Available throughout the WHOLE STATE OF CALIFORNIA ONLY! FHA 30 Year Fixed Max LTV 96.50% Max CLTV Maximum Loan Amount Loan Purpose Occupancy Down Payment Assistance 99.50% (Unlimited if funded by a Government Sponsored Entity) Follow FHA guidelines Conforming: Up to $417,000 Jumbo: > $417,000 to $729,750 based on county where property is located FHA Loan Limits Purchase Owner Occupied CHF ACCESS 2 nd : CAN be used to fulfill the borrower s equity contribution required on FHA 1 st Mortgage

7 CHF ACCESS 2nd Program Topic Program Description Program Types CHF ACCESS 2 nd Fixed Term Maximum Loan Amount 15-yrs Fixed-Rate Fully Amortizing 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 2 nd loan proceeds Any overage over POCs must be used to reduce principal balance Any overage over $500 results in redraw of loan documents

8 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, CHF ACCESS 2nd (Down Payment): 3% ($325,000 x 3%) $9, Total Financing 1st & 2nd: 99.5% of Sales Price $323, = Borrower Required Down Payment:.5% ($325,000 x.5%) $1, 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, Borrower Funds (Down Payment): 3.5% ($325,000 x 3.5%) $11, CHF ACCESS 2nd (Closing Costs): 3% ($325,000 x 3%) $9, Total Financing 1st & 2nd: 99.50% of Sales Price $325, = Borrower Contribution: 3.5% ($11,375) for DP

9 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, CHF ACCESS 2nd (Down Payment): 3% ($325,000 x 3%) $9, Total Financing 1st & 2nd: 99.50% of Sales Price $323, = Gift Funds Received 5% ($325,000 x 5%) $16, % given for DP 0.5% ($325,000 x.5%) $1, % towards CC 4.5% ($325,000 x 4.5%) $14, Borrower Contribution: ZERO ($0)

10 Program Income Limits Topic Income Limit Calculation Guidelines 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: Tip: Create an Income Limit spreadsheet

11 ADDITIONAL GUIDELINES Eligibility Guidelines General Underwriting Guidelines Pricing, Costs and Fees

12 Eligibility Guidelines Topic Borrower Eligibility Guidelines Purchase of Owner-Occupied Primary Residences Only NO 1 st Time Homebuyer Requirement MAY 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 Sales Price Limits First Time Homebuyer Non Occupying Co- Borrowers/Co-Signers Homebuyer Education Minimum Homebuyer Contribution 120% of HUD Area Median Income (AMI) Not Applicable Not Required NOT ALLOWED Required NONE required

13 Underwriting Guidelines Topic Underwriting Guidelines 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 21 st Century FHA overlays** Minimum Credit Scores NO MINIMUM FICO SCORES required Follow 4155 guidelines PLUS 21 st 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

14 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 Assumability No Prepayment Penalty Allowed per FHA guidelines

15 ACCESS Fees & Charges Topic Guidelines Interest Rates Interest Rates available on the 21 st Century Home Loan Rate Sheet found on the individual website Contact 21 st Century Home Loan for more information Origination Fees Up to 1.00% on 1 st 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 FMC Fees See 21 st Century rate sheet 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 21 st Century rules on limitation of fees for FHA loans