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Published by , 2016-01-05 01:30:50

chdap

chdap

CALIFORNIA HOUSING FINANCE AGENCY

California Homebuyer’s
Downpayment Assistance

Program (CHDAP)

LAST REVISED: JULY 2015

Table of Contents CALHFA CHDAP PROGRAM

I. Program Summary 1
a. Target Markets
b. Participating Lenders

II. Eligibility 1

a. Borrower Requirements

b. Homebuyer Education

c. First-Time Homebuyer Definition

d. Owner Occupancy

e. Property Requirements

f. Property Flipping 2

g. Income & Sales Price Limits

III. Underwriting & Compliance 3

a. Term

b. Maximum Loan Amount

c. LTV and CLTV

d. Income Requirements 3

e. Qualifying Income vs. Tax Compliance Income

f. Maximum Tax Compliance Income Limits

g. Underwriting

h. Minimum Credit Score & DTI Ratios 4

i. Fees 5

IV. Basic Home Protection Coverage 7
a. Mandatory Home Warranty Insurance Coverage

V. Repayment 7

VI. Forms 7
a. Origination Loan Submission
b. Post-Closing Loan Delivery & Purchase

VII. Post-Closing Loan Delivery and Purchase 8
a. Purchase Procedures 8

VIII. Benefits of using CDHAP with a CalHFA First Mortgage 9

IX. Questions 9
a. Sale Tools and Marketing Materials

2015 CALIFORNIA HOUSING FINANCING AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) ii

Program Summary CALHFA CHDAP PROGRAM 1

The California Homebuyer’s Downpayment In addition, CalHFA will permit qualified
Assistance Program (CHDAP) is a deferred homebuyers to use other down payment
payment, simple interest rate junior loan. assistance loans or grants to help in the
The CHDAP loans are available up to, but purchase of the home.
cannot exceed 3% of the sales price or
appraised value of the property, whichever Target Markets
is less. This program is intended for first-time
homebuyers anywhere in California.
The CHDAP can be used for down
payment assistance and/or closing costs Participating Lenders
with eligible CalHFA’s first mortgage This program is only available through a
loans or non-CalHFA fixed rate, first CalHFA-approved lender
mortgage loans.
For CalHFA purposes a first-time
Eligibility homebuyer is defined as a borrower who
has not had an ownership interest in any
Borrower Requirements principal residence during the previous
• First-time homebuyer(s) three years.

• Each borrower must be a U.S. Owner Occupancy
citizen, permanent resident alien or • All borrowers must occupy the
qualified alien property as their primary residence
within sixty (60) days of closing
• Meet credit, income and loan
requirements of CalHFA, the • Non-occupant co-borrowers are not
CalHFA lender and the mortgage allowed
insurer/guarantor
• Non-occupant co-signors are not
Homebuyer Education allowed on CalHFA Conventional nor
Homebuyer Education is required for one CalPLUS Conventional
occupying borrower on the loan.
• Non-occupant co-signors are
• Online Homebuyer Education allowed per FHA first mortgage
through eHometm guidelines, but cannot occupy the
property,be on title or have a vested
• Face-to-Face Homebuyer Education interest in the property
through NeighborWorks America or
through one of the HUD approved Property Requirements
Housing Counseling Agencies With a CalHFA first mortgage:

First-Time Homebuyer Definition • Follow the applicable CalHFA first
To qualify for the CHDAP loan program, mortgage loan program handbook
all borrowers, including co-borrowers must guidelines.
reside in the home and must meet the (continued on next page)
definition of a first-time homebuyer.
www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432)
2015 CALIFORNIA HOUSING FINANCING AGENCY

Eligibility (cont.) CALHFA CHDAP PROGRAM

• Manufactured housing is allowed • Meet the requirements of the
when combined with a FHA first mortgage insurer/guarantor and
mortgage only follow the applicable first mortgage
underwriting guidelines.
›› Manufactured home must be on
a permanent foundation • Leaseholds/Land Trusts and Co-ops
are not allowed
›› Minimum credit score of 660
required • There is a five acre maximum on
the size of the property
With Non-CalHFA first mortgages:
• Sales price of the home cannot • Defects and /or repair conditions
exceed CalHFA’s sales price limits identified by the appraiser on the
established for the county in which appraisal report must be corrected
the property is located prior to purchase by CalHFA

• Be a single-family, one-unit ›› All units must be complete
residence, including with respect to construction or
condominium/PUD repairs and ready to occupy

• Guest houses, “granny” units, and ›› Escrow Holdbacks must be
“in-law” quarters are eligible released prior to purchased

›› Must be zoned for Single Family Property Flipping
Occupancy Follow the applicable mortgage insurer/
guarantor first mortgage underwriting
›› Cannot be zoned for 2-4 units guidelines.

›› Must meet investor guidelines CalHFA requires a copy of all appraisals
and city/county zoning as required by the applicable government
ordinances insurer/guarantor. When multiple appraisals
are required, CalHFA will base the CHDAP
›› May not be income-producing; loan amount on the lesser of the sales
shall be for personal use only price or least appraised value.

• Manufactured housing is allowed Income & Sales Price Limits
when combined with a FHA first The following reference materials disclose
mortgage only income and sales price limits by county:

›› Manufactured home must be on 1. Income Limits (w/FHA)
a permanent foundation
2. Income Limits (w/Conventional)
›› Minimum credit score of 660
required 3. Sales Price Limits

›› Must follow FHA guidelines

• Energy Efficient Mortgages (EEM)s
are not eligible

2015 CALIFORNIA HOUSING FINANCING AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 2

Underwriting & Compliance CALHFA CHDAP PROGRAM 3

Term Qualifying Income vs.
The term of the CHDAP matches the term Tax Compliance Income
of the first mortgage not to exceed thirty Qualifying income is the income used by
(30) years. Payments on the subordinate lender to determine that the borrowers
loan are deferred for the life of the first have the ability to meet their monthly
loan. CHDAP is due and payable when obligation. Lender will continue to
certain events occur. See “Repayment of adhere to the guidelines of their internal
Subordinate Loan”. underwriting guidelines, mortgage
insurer, and this program handbook.
Maximum Loan Amount This income may differ from the income
Amount not to exceed 3% of the sales used by CalHFA for tax compliance
price or appraised value, whichever is less. purposes. All sources of income must be
used to determine program compliance
When the applicable government insurer/ income limits.
guarantor requires multiple appraisals,
CalHFA will base the CHDAP loan amount Maximum Tax Compliance
on the lesser of the sales price or lowest Income Limits
appraised value. The income of all borrowers cannot exceed
the published CalHFA CHDAP moderate
LTV and CLTV income limits established for the county in
Loan-to-Value (LTV) to follow the which the property is located.
applicable mortgage insurer/guarantor
investor guidelines and the applicable first When multiple CalHFA loan programs are
mortgage underwriting guidelines used in combination, the most restrictive
income limits will apply.
With a CalHFA first mortgage:
Follow the applicable CalHFA first CalHFA will calculate family income for
mortgage loan program handbook CalHFA CHDAP program eligibility. “Family
guidelines. income” is defined as the annualized gross
income of a mortgagor, and any other
With Non-CalHFA first mortgages: person who is expected to:
Maximum Combined Loan-to-Value (CLTV)
cannot exceed 103% 1. be liable on the mortgage

Income Requirements 2. be vested on title; and
Lenders are required to calculate income to
qualify borrower(s) for loan approval using 3. live in the residence being financed
investor guidelines; in addition, CalHFA will
recalculate the borrower’s income pursuant Underwriting
to tax compliance. With a CalHFA first mortgage:

2015 CALIFORNIA HOUSING FINANCING AGENCY • Follow the applicable CalHFA first
mortgage loan program handbook
guidelines.
(continued on next page)

www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432)

Underwriting & Compliance (cont.) CALHFA CHDAP PROGRAM

With Non-CalHFA first mortgages: • Loans submitted for approval must
• Lenders should follow the be fully underwritten
applicable Fannie Mae/Freddie
Mac conventional or government • Verification of employment and
insured/guaranteed first mortgage other supporting documentation
underwriting guidelines regarding income such as paycheck
stubs should be no more than
• Mortgage Insurance is required sixty (60) days old at the time of
on all first mortgages with a LTV submission to the Agency for loan
exceeding 80% approval

• Fully amortized, maximum thirty • In the case of conflicting guidelines
(30) year fixed rate the more restrictive apply

• Mortgage Credit Certificate (MCC) Minimum Credit Score & DTI Ratios
Credit may be used for credit
qualifying as per first mortgage First Mortgage LTV Min. Credit
guidelines Loan Type Score

• Energy Efficient Mortgages (EEMs) CalHFA FHA First Follow Insurer 640
are not eligible Mortgages Guidelines

• Acceptable Automated CalHFA Conventional 95.01 – 97.00% 680
Underwriting Systems:
First Mortgages ≤ 95.00% 640
›› Follow the applicable mortgage
insurer/guarantor first mortgage Non-CalHFA Follow Insurer 640
underwriting guidelines FHA/VA/USDA First Guidelines
Mortgage
»» Fannie Mae Desktop
Underwriter (DU®) Non-CalHFA 95.01 – 97.00% 680
Conventional
»» Freddie Mac Loan Prospector First Mortgage ≤ 95.00% 640
(LP®)
Follow the applicable mortgage insurer/
»» Guaranteed Underwriting guarantor first mortgage underwriting
System (GUS), for USDA guidelines
loan only
• A co-borrower with no credit score
• Manual underwriting is allowed with may be eligible as long as an
FHA first mortgages only occupant borrower has a credit
score that meets the minimum
• Maximum 43.00% total debt- representative credit score
to-income ratio regardless of requirement.
automated underwriting decision or
compensating factors • When all borrowers have a credit
score, they must all meet the
• CHDAP may be combined with minimum representative credit
other down payment and/or closing score requirement
cost assistance programs
• The middle score of the lowest
scoring borrower should be used to
determine eligibility

(continued on next page)

2015 CALIFORNIA HOUSING FINANCING AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 4

Underwriting & Compliance (cont.) CALHFA CHDAP PROGRAM

Fees Reservation when combined with non-
Lender Allowable Fees: CalHFA First Mortgages:

• First Mortgage maximum allowable • A sales contract must be executed
fees: prior to reservation

›› Customary lender origination • Lender must register loans using
fees may not exceed the greater CalHFA Mortgage Access System
of 3% of the first mortgage loan (MAS) prior to loan submission
amount or $3,000
• Reservations will be accepted from
›› Other customary third-party 6:00 a.m. to 11:59 p.m. Pacific
fees such as credit report fee, Time seven days a week
appraisal fee, insurance fee or
similar settlement or financing • Lender reserves loan funds and
cost may be charged locks interest rate at no fee for sixty
(60) days for both existing/resale
›› In all cases the lender must properties and new construction
meet federal and California properties
lending laws regarding fees and
charges Delivery Timeframes:
• All loans must be approved, closed,
• CalHFA Subordinate loan: delivered and purchased by CalHFA
(Processing) prior to the reservation expiration
date
›› Maximum total processing fee of
$250 • All CHDAP loans with CalHFA
first mortgages must follow the
Reservation and Rate Lock applicable first mortgage loan
Reservation when combined with CalHFA program handbook
First Mortgages:
Extensions:
• A sales contract must be executed • All loans must be approved, closed,
prior to reservation delivered and purchased by CalHFA
prior to the reservation expiration
• Lender must reserve CHDAP date
with first mortgage using CalHFA
Mortgage Access System (MAS) • Lender must request extension via
prior to loan submission email ([email protected])
from CalHFA’s Secondary Marketing
• Lender must reserve CHDAP Unit prior to expiration of the
with first mortgage using CalHFA existing rate lock
Mortgage Access System (MAS)
prior to loan submission • All CHDAP loans combined
with CalHFA first mortgages will
›› All CHDAP loans will have the automatically be extended when the
same rate lock, delivery and first mortgage is extended
expiration date as the CalHFA
first mortgage loan (continued on next page)

• Follow the applicable CalHFA first
mortgage loan program handbook

2015 CALIFORNIA HOUSING FINANCING AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 5

Underwriting & Compliance (cont.) CALHFA CHDAP PROGRAM

• Any CHDAP which has funded, for an additional sixty (60) day
but has not been delivered to reservation timeframe at any time
CalHFA and or purchased prior to prior to loan closing (funding)
the reservation expiration may be
extended: ›› New reservations are subject to
the policies and procedures in
›› CalHFA offers extensions in effect as of the date of the new
15 day increments up to a reservation
maximum of 60 days from the
original expiration date ›› New reservations may require
a full update of aged credit,
15 days CHDAP income and/or property
30 days $125 documentation
45 days $250
60 days $375 ›› Only one re-reservation will
$500 be permitted on the same
transaction
• All extensions are subject to
the following: Additional Program Options
Effective January 1, 2005, state legislation
›› Extension fee paid to CalHFA has increased the amount of down
via corporate check or certified payment assistance offered under the
funds CHDAP; from 3% to 5% of the purchase
price or the appraised value (whichever
›› New Preliminary Title Report/ is less) for borrowers purchasing a newly
Property Profile showing no constructed home in specific eligible areas.
additional recorded loans since
loan closing Below is a list of government entities
that have eligible areas (such as, an
›› Lender, not the borrower, shall infill opportunity zone, transit village
pay for all costs associated with development district or transit-oriented
the extension fee, including development plan area) or you may contact
the extension fee and new your local city/county planning department.
Preliminary Title Report
Participating Government Entities:
›› The first mortgage payment
history showing the Land Development Coordinating Center
loan as current with no Dept. of Regional Planning
past delinquencies County of Los Angeles
(213) 974-6411
Re-Reservations:
• All loans must be approved, City of Long Beach
closed, delivered and purchased Contact: Patrick Ure
by CalHFA prior to the reservation (562) 570-5269
expiration date Eligible Area: Olive Court Development

• Lender may cancel an existing
reservation that is combined with
a non-CalHFA first and re-reserve

2015 CALIFORNIA HOUSING FINANCING AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 6

Basic Home Protection Coverage CALHFA CHDAP PROGRAM

Mandatory Home Warranty Insurance • Home Warranty to be paid through
Coverage close of escrow

• CalHFA requires that all borrower(s) • Home Warranty must be disclosed
obtain a one-year home warranty on Final HUD-1 or copy of
protection policy insurance declaration page will be
required
• The insurance must cover the
following items at a minimum: • Exceptions to Home Warranty:

›› Water Heater(s) ›› If borrower is purchasing a new
construction property from
›› Air Conditioning a builder and the builder is
providing the home warranty
›› Heating
›› Borrower is not a First Time
›› Oven/Stove/Range Homebuyer

Repayment

Repayment of the principal and interest • Refinance of the first loan, unless
on the subordinate loan shall be due the CHDAP is subordinated
and payable at the earliest of the
following events: • Upon the formal filing and
record¬ing of a Notice of Default
• Transfer of title (unless rescinded)

• Sale of the property* *CHDAP loans behind an FHA first
mortgage may be assumed or paid off
• Payoff of the first loan when the first mortgage is assumed.

Forms

Origination Loan Submission Post-Closing Loan Delivery &
The following Loan Origination forms will Purchase
be needed for loan submission to CalHFA: The following Loan Purchase forms will also
be needed for loan submission to CalHFA:
1. Tax Return Affidavit
1. Loan Purchase Submission
2. CalHFA Borrower Affidavit Check List

3. CalHFA Borrower & Lender Affidavit 2. Promissory Note
of Loan Analysis Comparison (Conventional, USDA or VA)

3. Deed of Trust
(Conventional, USDA or VA)

4. Promissory Note (FHA Only)

5. Deed of Trust (FHA Only)

2015 CALIFORNIA HOUSING FINANCING AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 7

CALHFA CHDAP PROGRAM

Post-Closing Loan Delivery and Purchase

Purchase Procedures ›› Loans may be registered via
CHDAP Subordinate loan: MERS in lieu of Assignment of
Mortgage Deed of Trust
• All CalHFA CHDAP loans are to be
funded, delivered and purchased • Loss Payee Clause:
by CalHFA concurrently with first
mortgage, if applicable U.S. Bank National Association
Its successors and or assigns as
• Loan documents are to be drawn in their interest may appear.
CalHFA’s name. c/o U.S. Bank Home Mortgage
P.O. Box 7298
• Loss Payee Clause: Springfield, OH 45501-7298

California Housing Finance Agency • Send CalHFA first mortgage closed
Its successor and or assigns loan files and documents to:
Single Family Servicing – MS 980
500 Capitol Mall, Suite 400 U.S. Bank MRBP
Sacramento, CA 95814 17500 Rockside Road
Bedford, OH 44146
• Send closed loan documents to: Attn: Operations Department
[email protected]
California Housing Finance Agency
Single Family Production – MS 300 CalHFA MCC Tax Credit Closing
500 Capitol Mall, Ste. 400 Package(s):
Sacramento, CA 95814
877.922.5432 • All final Closing Packages for the
MCC application and documents
CHDAP Lien Position: should be submitted to the Program
• The CHDAP may be in any lien Administrator at:
position
eHousingPlus
All CalHFA First loans: 3050 Universal Blvd., Ste. 190
• Notes are to be endorsed to U.S. Weston, FL 33331
Bank National Association 954.217.0817

• Deed of Trust to be assigned to U.S.
Bank National Association

2015 CALIFORNIA HOUSING FINANCING AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 8

CALHFA CHDAP PROGRAM

Benefits of using CDHAP with a CalHFA First Mortgage

• Faster turn times with priority Requirement CHDAP w/ CHDAP w/
CalHFA Compliance review Turn Times CalHFA first non-CalHFA
mortgage first mortgage
• DTI maximum is increased to
45.00% Priority Review Regular Review

• CLTV maximum is increased to DTI 45.00% 43.00%
105%
CLTV 105% 103%
• Get access to additional Yes No
Downpayment assistance with ZIP/ Access to ZIP/ Yes No
ZIP Extra ZIP Extra Yes No

• Can be combined with Energy Combine w/EEM
Efficient Mortgage (EEM) on CalHFA
FHA or CalPLUS FHA Meet PLO
Requirements
• Meets requirement to become a
CalHFA Preferred Loan Officer status
and get free leads

Questions

Questions regarding the California Sale Tools and Marketing Materials
Homebuyer’s Downpayment Assistance
Program should be directed to CalHFA- 1. FHA Program Matrix
approved lenders or CalHFA’s Single Family
Lending Division at: 2. Scenario Calculator
3. Loan Submission, Review and
CalHFA Single Family Lending – MS 300
P.O. Box 4034 Purchase Flow Chart for FHA
Sacramento, CA 95812-4034 4. CHDAP Flyer
Phone: 877.9.CalHFA 5. CHDAP Fillable Flyer
Email: [email protected] Loan 6. CHDAP Spanish Flyer
7. CHDAP Spanish Fillable Flyer
8. Lending Heroes Flyer
9. Lending Heroes Fillable Flyer
10. Lending Heroes Spanish Flyer
11. Lending Heroes Spanish Fillable

Flyer

2015 CALIFORNIA HOUSING FINANCING AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 9


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