HOMEOWNERSHIP ASSISTANCE PROGRAM SUMMARY Product Description Allowable Origination Channel Program Name Program Approval Expiration Housing Authority Second mortgage loan program to be used in conjunction with: FHA Fixed Rate Fannie Mae Fixed 30 year Conforming Product (DU) Fannie Mae Housing Authority Product Fannie Mae HomeReady with Community Second Retail Las Vegas Branch 208 Subject to Availability approval expires: 4/22/2017 City of Las Vegas City Hall (Lender) 495 S. Main Street Las Vegas, NV 89101 Attention: Office of Community Services Financial Guidance Center (Administrator) 2650 South Jones Las Vegas, NV 89146 Phone: (702) 364-0344 Myriam Ramirez Email: info@financialguidancecenter.org Website: https://www.financialguidancecenter.org/ FGC Loan Officer Training website: http://fgctraining.com/ Housing Authority EIN 88-6000198 DPA Provider Classification Government Entity Secondary Financing Programs First Mortgage Maximum LTV First Mortgage Maximum CLTV FHA: 96.5% Refer to Product Profile Fannie Mae Housing Authority Product. Refer to Product Profile Fannie Mae Conforming Product: Refer to Product Profile Fannie Mae HomeReady with Community Second: Refer to Product Profile o Purchase only: o 1 unit: LTV >95-97% (NO first-time home-buyer (FTHB) requirement). o Purchase and Limited Cash Out (Rate/Term): o 1 unit: 95% FRM; 90% ARM FHA: May not exceed 100% Fannie Mae Housing Authority Product. Refer to Product Profile Fannie Mae Conforming Product: Refer to Product Profile for CLTV requirements, may not exceed limits in product profile Fannie Mae HomeReady: 105%** The CLTV may not exceed 105% on HomeReady loans, unless further restricted by product profile. The sum of all financing may not exceed 105% of the cost to acquire the property plus any normal prepaid expenses. Maximum Second Mortgage Loan Amount Interest Rate Minimum Borrower Down Payment Up to $25,000 0% 50% of the down payment or $1,500 whichever is greater. Limit of 2.5% of purchase price on gifted funds. Page 1
FHA: Refer to Product Profile Fannie Mae Housing Authority Product. Refer to Product Profile Fannie Mae Conforming Product: Refer to Product Profile Fannie Mae HomeReady with Community Second: Refer to Product Profile NOTE: If first mortgage guidelines are higher than the Agency s for borrower s minimum investment, the first mortgage guidelines prevail. Second Mortgage Purpose Down payment Closing costs Repayment Terms The second mortgage is a deferred zero interest loan with a ten (10) or fifteen (15) year Affordability Period depending on the amount of the loan. The assistance is forgiven at the end of the Affordability Period. If, during the first five years of the Period of Affordability, the homebuyer fails to comply with the conditions, the homebuyer shall pay to the City an amount equal to the current market value of the Property (as established by an appraisal thereof) less any portion of the value attributable to expenditures of non-nsp funds for the acquisition of, or improvements to the Property. If Borrower receives a deferred loan in an amount greater than $15,000 but less than $40,000, and Borrower fails to comply with the conditions set forth in Section II above, Borrower shall repay the Deferred Loan in an amount determined by the following prorated schedule: Deferred Loan with 10-year Period of Affordability: Through the end of year 6 = 50% of loan Through the end of year 7 = 40% of loan Through the end of year 8 = 30% of loan Through the end of year 9 = 20% of loan Through the end of year 10 = 10% of loan At the end of the 10th year, no repayment required If Borrower receives a deferred loan in an amount which is greater than $40,000, and Borrower fails to comply with the conditions set forth in Section II above, Borrower shall repay the Deferred Loan in an amount determined by the following prorated schedule: Deferred Loan with 15-year Period of Affordability: Year 6 through the end of year 7 = 50% of loan Year 8 through the end of year 9 = 40% of loan Year 10 through the end of year 11 = 30% of loan Year 12 through the end of year 13 = 20% of loan Year 14 through the end of year 15 = 10% of loan At the end of the 15th year, no payment requirement However, if any of the following repayment triggering events occur, the principal balance and any accrued interest shall be due and payable in full: Evidence of the act of fraud committed to falsely obtain assistance funds The property is sold Transferred title Page 2
Refinancing with cash out A default on the first mortgage The borrower(s) ceases to occupy the property as their principal place of residence Upon the death of the last surviving applicant The filing of any bankruptcy by the applicants Upon divorce, unless one of the applicants continues residing in the property by the decree of divorce Loan may be pre-paid in full at anytime Loan is NOT assumable Types of Financing Purchase Money Mortgage Occupancy Owner occupied primary residence only All co-borrowers must occupy Borrower(s) may not have an ownership interest in any other residential dwelling at the time of loan closing Geographic Location Properties must be located within the City limits of Las Vegas, Nevada Eligible Properties Acquisition Limit: There are no maximum purchase price limits. Borrower must qualify for a loan that meets the purchase price of the NSP1 property that is listed for sale by the City of Las Vegas. Properties shall be sited on a permanent foundation, with a permanent utility hook-up, and may include: Single family - detached, attached Condominiums or Townhomes or Planned Urban Development -detached, attached The City of Las Vegas will perform the code inspections for any purchases. ALL repairs called for by inspection MUST be completed prior to closing. Underwriting Refer to product profile for additional property eligibility requirements, not all property types are allowed on all products. Lender to pre-approve all borrowers for the first mortgage product. Standard FHA, Fannie Mae Conforming Product, Fannie Mae HomeReady, except as described herein: Qualified homebuyers must submit an application package directly to the Administrator FGC all of the forms are available on their training website: http://fgctraining.com/ Upon qualification of the underwriting, the homebuyer will be issued a preapproval letter indicating the amount of assistance. Upon approval, a copy of DPA Approval Letter MUST be in each file. Eligible Borrowers Borrower(s) must qualify for the first mortgage selected. First Time Home Buyers (FTHB) only Borrowers may not currently own a house and may not have owned a house during the last three years prior to making application. Resident of Clark County for at least 3 months. Borrower must be a legal resident of the United States. Minimum credit score is 640. Ratios cannot exceed 30% front and 41% back. Assets Borrower must have required amount of their own funds in the transaction for type of first mortgage financing selected. Income Limits 120% AMI Clark County Effective March 16, 2016 1 Person 2 Persons 3 Persons 4 Persons 5 Persons 6 Persons 7 Persons 8 Persons $51,600 $58,950 $66,300 $73,700 $79,450 $85,450 $91,350 $97,250 Page 3
NOTE: If first mortgage guidelines are more restrictive than the Agency s for borrower s income limit, the first mortgage guidelines prevail. MI Coverage FHA: Standard UFMIP and monthly if applicable Fannie Mae Housing Authority Product Refer to Product Profile Fannie Mae Conforming Product Refer to Product Profile Fannie Mae HomeReady and Conforming (DU) Products: Standard mortgage insurance requirements must be met, if applicable, as described in Product Profile Special Provisions Homeownership Counseling: Refer to product profile for specific product requirements Borrowers must successfully complete a face to face 8-hour homebuyer education class provided by a HUD approved counseling agency or Financial Guidance Center Borrower s Certification of Completion of Homeownership Counseling is required Financial Guidance Center (FGC) will charge up to a $3,130 administration fee paid through closing. Fannie Mae HomeReady Only: Borrowers must successfully complete a homebuyer education class provided through Framework, on line program approved by Fannie Mae. Special borrower consideration can be made for borrowers with the presence of a disability, lack of internet access, or other issues. Framework has a toll-free customer service line for direction. In lieu of Framework course, Fannie Mae will allow lenders to accept a certificate of prepurchase education/counseling from a HUD approved counseling agency dated within the previous six months before loan application date and before April 1, 2016. Landlord education required for 2-4 units only. This education is not available through Framework. All: May be funded by a municipality, state, county or local housing finance agency, non-profit organization, a regional Federal Home Loan Bank or an employer May be used to fund all or part of the down payment or closing costs The more restrictive down payment requirement between the product and the second mortgage will apply No reporting requirements permitted DPA Processing Fee Costs incurred for down payment assistance secondary financing program may only be included in the amount of the second lien. The fee cannot be included in the first mortgage transaction or appear on the HUD-1. Special Feature Code N/A Underwriting Requirements Receipt of borrower s approval from DPA provider Receipt of DPA Funds (at closing) No cash back at closing (at closing) Copy of DPA s Executed Note and Subordinate Mortgage (at closing) First Mortgage Loan Documents Loan documents and security instruments must conform to Agency requirements ( Fannie Mae as applicable by loan type) Documents Loan documents and security instruments must conform to Agency requirements ( Fannie Mae as applicable by loan type) PRMG DPA Program Restrictions The may not That Are Not Permitted Restrict the transfer of servicing rights of the first Mortgage Require prior notification or approval from the sponsoring authority in the event of the transfer of the first mortgage servicing rights. If there is any evidence of this verbiage in the subordinate documents, the program will no longer be eligible. Page 4
The First Mortgage may not be subject to a bond program loan documents and security instruments must conform to Agency requirements (FHA, Fannie Mae as applicable by loan type) Special Requirements: PRMG executed a Lender Agreement to participate in the HOME Homebuyer Assistance Program. This program is only available to Las Vegas Retail Branch 208. Retail Branch 208 Loan Officers will need to register, pay a $39 training and exam certification fee by visiting Financial Guidance Center Training website: http://fgctraining.com/. The Loan Officer will obtain all of the required forms from FGC Training website under Procedures and Modules and Support Materials for the HOME Homebuyer Assistance Program. Note: The certificate is valid for 12 months from the time the exam was passed. This Fact Sheet form and any attachments MUST be placed in each loan file at the time of submission. Note: The Financial Guidance Center is currently listed on HUD s list of approved nonprofit agencies. Additional Comments: Income eligible homebuyers can obtain up to $25,000 for down payment and closing cost assistance associated with the first mortgage. This second mortgage is a deferred zero interest loan with a maximum fifteen (15) year Affordability Period. The assistance is forgiven at the end of the Affordability Period. APPROVAL ELIGIBLE INELIGIBLE The DPA IS eligible for use with the programs below The DPA IS NOT eligible for use with the programs below CONV (DU) FHA VA USDA CONV FHA VA USDA X X X X PRMG Approved by: PRMG DPA Review Department 4/22/2016 Name / Title Date Page 5