INSTRUCTIONS TO SETUP AHFA CONVENTIONAL HFA STEP UP LOAN IN MORTGAGE BUILDER As of 7/15/14 1) First, set up the Step Up first lien in Mortgage Builder (MB). Be sure that the loan program selected is Step Up_Conv_HFA Preferred. 2) On the Loan Detail screen, ensure that the appropriate MI plan is selected. If the Alabama Home Buyer Initiative is used (AHFA paid single premium MI), select the AHFA single options based on qualifying FICO. If those funds are exhausted and borrower paid monthly MI is applicable, select the AHFA monthly options based on qualifying FICO. BE SURE THAT YOU OBTAIN A RATE QUOTE FROM GENWORTH S WEBSITE TO CONFIRMT THE CORRECT MI FACTORS ARE APPLIED IN MB.
3) In the GFE Closing Costs screens, ensure that the correct Fees Id of RETAIL_AHFA_PURCH is selected. Note that AHFA requires a 1% Origination Fee to be charged by Platinum Mortgage. We may not lower or credit against this fee for any borrower regardless of builder or other negotiations or special offers. Be sure that the AHFA Commitment Fee (0.50% for 15 day lock or 0.75% for 30 day lock) is reflected on box 3 of the GFE (page 2). Also, if an extension becomes necessary, a revised GFE, lock agreement reflecting the total cost (initial commitment fee plus extension cost) is required. 4) In the GFE Prepaids/Reserves screen, it will reflect the borrower paid MI if the single premium option is selected. NOTE THAT THIS MUST BE REFLECTED AS BORROWER PAID IN ORDER TO BE DISCLOSED ON THE GFE AND 1003 PER AHFA REQUIREMENTS. A CREDIT WILL BE REFLECTED ON THE 1003 DOT TO OFFSET THIS AMOUNT AND THE FINAL HUD 1 WILL REFLECT THIS ITEM AS PAID BY AHFA. 5) In the Proposed Housing Payment screen in MB, enter the proposed 2 nd lien P&I payment by clicking the small calculator square to the right of Other Financing to bring up the P&I calculator. Enter the 2 nd lien amount (maximum is the lesser of 3% of sales price or $7500), same rate as the first and 120 months for term. This will enter the proposed P&I for the 2 nd lien on both this screen and the Origination Summary screen once saved.
6) In the 1003 Details of Transaction screen, the single premium MI should be reflected in line g. Enter a corresponding amount in line l and label it as AHFA LPMI Credit. NOTE THAT THIS IS ONLY APPLICABLE IF FUNDS REMAIN AVAILABLE FOR THE AL HOMEBUYER INITIATIVE PROGRAM WHERE AHFA PAYS THE MI COST. IF THOSE FUNDS ARE EXHAUSTED, THE MI PLAN MUST BE REVISED TO A MONTHLY PLAN AND A REVISED GFE/TIL ISSUED TO THE BORROWER AND ANY LENDER CREDIT REMOVED FROM LINE L ON THE DOT SCREEN. 7) When submitting your loan to DU, you MUST ensure that the proper codes are selected so that DU evaluates the loan as the special HFA Preferred product. On the Fannie Mae DU Submission screen in MB, be sure to select the FNMA Comm Lending Product option as HFA Preferred from the drop down list. Also, if a DPA 2 nd lien will be utilized, the checkbox to the right of Community Seconds must be checked and Any payment required within first five years chosen from the Repayment Structure drop down list. Ensure these options are all properly chosen for initial and any subsequent DU submissions.
8) Your DU Findings must be Approve/Eligible. No other recommendation is allowed by AHFA nor is any LP finding. Ensure that your DU Findings reflect the notation regarding the HFA Preferred product as shown in Findings # 3 & 4 in the example below. Also, note that the MI coverage percentage is reflected on your findings (#5 in this example) be certain that your MI disclosed matches this required coverage percentage. 9) Additionally the DU Findings will list requirements regarding Community Seconds eligibility if the Community Seconds option is selected on the DU Submission screen. Be sure this finding is reflected if a DPA 2 nd lien exists for the transaction. AHFA DPA 2 nd liens will be considered to meet Fannie requirements with no future documentation. Also, all borrowers must execute the AHFA delinquency counseling form. 10) Finally, the findings will reflect that at least one borrower must complete home buyer education. However, AHFA requires all borrowers and spouses (all mortgagors) complete home buyer education. 11) Be sure to print the first lien application and disclosure set in MB. You must also manually add the AHFA disclosure package to it to be completed and signed by the borrowers. 12) Once the first lien is completely setup and disclosed, including property address, all application and disclosure screens, you must credit a 2 nd lien file for disclosure of the 2 nd mortgage. In MB, select the Administration Menu, then select the System Administration sub menu, then select the Copy Loans sub menu, then select the Create 2 nd loan from First Mortgage option. This will open the Create Second Mortgage screen as shown below. Ensure that the first loan information is shown on this screen (if you were in the first loan most recently, it should be reflected) and click the COPY button at the bottom.
13) This will bring up the Copy Loan Number screen asking you to input a new loan number for the new 2 nd mortgage in MB. Type in NEW and press <ENTER> and MB will create the 2 nd lien and assign a new loan number to it. A message screen will display with the new 2 nd mortgage loan number take note of it. 14) Next, enter the Origination Summary screen and be sure that you are working in the newly created 2 nd lien loan number (should be displayed in the upper right corner). 15) Go into the Loan Registration screen and select the program for the 2 nd lien as DPAP_2ND_LIEN_AHFA.
16) In the Loan Detail screen, ensure that your loan amount, rate, term, etc are all entered correctly. There should not be any MI selected for the 2 nd lien file. 17) On the GFE Closing Costs screen, select the Fees ID as AHFA_2ND_LIEN, and ensure there are not any charges selected except for recording costs, transfer taxes, and interim interest on the GFE Prepaids/Reserves screen.
18) Be sure to go through the remainder of the loan screens to ensure it is all accurate. 19) Be sure to print a complete application and disclosure set, including a GFE & TIL for the 2 nd lien. 20) After the loan is approved by Platinum and Genworth, be sure to collect a commitment fee from the borrower payable to AHFA in the form of an official or cashier s check and fax a copy of it along with the Platinum lock agreement, DPA application and lock request to Secondary Marketing to secure the commitment. After the lock is confirmed by Secondary, be sure to redisclose the GFE for BOTH FIRST AND SECOND LIENS!!!
EXAMPLE DOCUMENTS: 1) Page 3 of 1003, Details of Transaction (DOT) should reflect the MI and credit for MI if the single premium option is chosen: 2) The TIL should reflect the single premium MI in the amount financed for the initial TIL Itemization:
3) A sample GFE page 1 for the first lien is shown below:
4) A sample GFE page 2 for the first lien is shown below:
5) A sample GFE page 1 for the second lien is shown below:
6) A sample GFE page 2 for the second lien is shown below: