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My Community Mortgage & Flexible Mortgage Training

My Community Mortgage & Flexible Mortgage Training

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My Community Mortgage & Flexible Mortgage Training

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  1. My Community Mortgage &Flexible Mortgage Training Offered through First Mortgage’s Wholesale Division

  2. Agenda • My Community Mortgage • Introduction • Eligibility Guidelines • Eligible Programs • Underwriting Guidelines • Community Solutions • Community HomeChoice • MCM Program Highlights • Flexible Mortgage • Introduction & Highlights of Program • Eligibility Guidelines • Underwriting Guidelines • Eligible Programs • Flex Program Highlights • Interest Rates & Fees • Marketing Tools, Training & Support

  3. MY COMMUNITY MORTGAGE Introduction to First Mortgage Corporation Introduction & Eligible Borrowers Suite of “Community Mortgage Options” My Community Mortgage Product Features

  4. Introduction • First Mortgage Corporation is an independent residential Mortgage Banking firm with branch offices located throughout the west. • Founded in 1975, FMC is a direct-lending mortgage banker approved as a lender and/or loan servicer by the Federal Housing Administration (FHA); the Veterans Administration (VA); the Federal National Mortgage Association (Fannie Mae); the Federal Home Loan Mortgage Corporation (Freddie Mac); the Government National Mortgage Association (Ginnie Mae); the California Housing Finance Agency (CalHFA); the Nevada Housing Division; the California Public Employees’ Retirement System (CalPERS); the California Teachers’ Retirement System (CalSTRS); and many other major secondary market institutions. • Having funded in excess of $12 billion in residential real estate loans, FMC has assisted more than sixty thousand families with their mortgage needs.  FMC enables families to enjoy the American Dream of Homeownership…“it’s the only thing we do.” • FMC has a longstanding tradition of providing unparalleled customer service and a reputation built on adding value to the home loan process.  That’s why FMC should be considered…“YOUR FIRST LENDING RESOURCE”.

  5. What is the MCM Program? Penetrating minority and other underserved markets is a core element of future growth and business success. • The MyCommunityMortgage (MCM) loan program is Fannie Mae’s program designed to help Lenders and Brokers meet the needs of low & moderate income homebuyers in your communities. • Market Restrictions: All 50 states (CA, NV, WA, OR, AZ for FMC) 2 Main Objectives of the program: • 1. AFFORDABILITY • Little to no cash required • 2. FLEXIBILITY • UW Flexibilities • Borrower Options

  6. Targeted Borrowers Low to Moderate Income Borrowers with…

  7. What is the current market doing? • The market continues to slow down • Product availability continues to shrink making it a challenge to find alternative financing solutions • Non-Agency products continue to experience liquidity issues • Purchases, refinances and new home construction are declining • Overall home values are either flat or depreciating throughout the country • There is a shift in the market from Agency products to Government products • Agency and Government products may be a better alternative to increase originations, lessen risk, and grow market share in this turbulent environment

  8. Opportunity • There are still borrowers who: • Are 1st Time Homebuyers • Have non-traditional credit • Have blemished credit and/or a low credit score • Have limited cash for down payment or closing costs • Have low-to-moderate income • Receive income from government benefits • Have boarder income from non-family members • Have cash-on-hand for closing • Community service professionals who could use extra flexibilities • Want to realize the benefit of homeownership

  9. Solution • Provide qualified borrowers an affordable, stable homeownership solution with MCM, by offering: • Loans to qualified FTHB, low-to-moderate income borrowers and other underserved markets • No minimum down payment for qualified borrowers • Up to 100% LTV and 105% CLTV • Non-traditional credit to those who need flexible credit options • Flexibility to use cash-on-hand for down payment and closing costs • Flexible options for sources of income • Up to 6% seller contributions on loans between 90.01-100% LTV • Lower initial monthly payments with optional temporary subsidy buydown plan • Fixed rates up to 40-year terms and adjustable rate mortgages (ARMS) • Community 2nds up to 105% CLTV • Low mortgage insurance (MI) coverage – maximum of 20% • No Area Median Income (AMI) limits in Fannie Neighbors areas • Interest only option available on 30 and 40 year fixed mortgages and 5/1 adjustable rate mortgage

  10. Suite of “Community” Mortgage Options

  11. PROGRAM TYPES 1ST Mortgage Programs 11 8/20/2014

  12. 1st Program Types • FIXED • Conventional Agency Fixed Rate • 10-40 year terms • Conventional Agency Fixed Rate Interest Only (10/20) • 30 year term1 • ARMS • Conventional Agency T-Bill ARM (5/1, 7/1 and 10/1) • 30 year term • Conventional Agency LIBOR ARM (5/1, 7/1 and 10/1) • 30 to 40 year terms

  13. Fully Indexed FIXED Programs

  14. Interest Only FIXED Programs

  15. ARM Programs

  16. Max LTV / CLTV & Fico

  17. ELIGIBILITY REQUIREMENTS Eligibility Borrowers Eligible Properties 17 8/20/2014

  18. Eligible Borrowers

  19. Eligible Properties

  20. INCOME REQUIREMENTS Borrower Income Requirements Other Income Requirements Overtime and Part-Time Income Boarder Income Rental Income Co-Borrowers Income 20 8/20/2014

  21. Income Requirement

  22. Other Income Requirements

  23. GENERAL GUIDELINES Underwriting Options Underwriting Guidelines Other General Guidelines Fannie Mae Geocoder Mortgage Insurance 23 8/20/2014

  24. Underwriting Options

  25. MCM DU Guidelines

  26. Credit Score • Minimum Credit Score requirements: • DU - No minimum credit score required except for IO loans (620) • Manual Underwrite:

  27. Credit History

  28. Other General Guidelines

  29. Buydowns, Down Payment, Sources of Funds

  30. Submitting an MCM loan through DU

  31. Determining Income Eligibility with the Fannie Mae Property GeoCoder • No Income limits if property is located in a Fannie Neighbors area • Workaround for new construction in a Fannie Neighbors census tract • For new construction (the address is not in the system), use the Property Geo Coder to provide a printout for the loan file showing an existing property in the same census tract • The appraisal must provide evidence that the subject property is in the same census tract

  32. Mortgage Insurance

  33. Mortgage Insurance

  34. Community SolutionsCommunity Solutions 100 & Community Solutions 97 Community Solutions a targeted borrower option under the MCM is designed especially for America’s teachers, police officers, firefighters, health care workers, and military personnel. Community Solutions adds flexibilities to the MCM to help our country’s valued workers overcome obstacles to homeownership. The Community Solutions option may be especially attractive to borrowers who have access to an Employer-Assisted Housing benefit to cover gifted reserves, a temporary interest rate buydown, and/or down payment or closing costs. 35 8/20/2014

  35. Community Solutions

  36. Community HomeChoice Community HomeChoice is an option under MyCommunityMortgage designed to meet the mortgage needs of low-to-moderate income borrowers with disabilities or have a family member with a disability. It offers extra flexibilities for borrower income and qualifying ratios, and allows a non-occupying co-borrower. 37 8/20/2014

  37. What is the Community HomeChoice

  38. Highlights of the MCM Program

  39. MCM Highlights Cont’d…

  40. FANNIE MAE FLEXIBLE 100 Introduction Eligible Borrowers Highlights of the Program Down Payment / Source of Funds 41 8/20/2014

  41. What is the Flexible Mortgage Program? • The Flexible Mortgage loan program is Fannie Mae’s reward program for borrowers with average to above average credit history who have experienced difficulty in saving a down program for a home. • Market Restrictions: All 50 states (CA, NV, WA, OR, AZ for FMC) Targeted Borrowers: • 1. Limited Funds for Down Payment • Flex 100 (NO DP) • Flex 97 (3% DP) • Use savings for other investments or expenditures • Use savings for moving expenses, etc. • 2. Have Access to alternative sources of funds • Gifts, grants, unsecured loans from relatives, employers, etc.

  42. Eligibility Guidelines

  43. Underwriting Guidelines

  44. Down Payment / Sources of Funds

  45. 1st Program Types • FIXED • Conventional Agency Fixed Rate • 10-40 year terms • Conventional Agency Fixed Rate Interest Only (10/20) • 30 year term1 • ARMS • Conventional Agency T-Bill ARM (5/1, 7/1 and 10/1) • 30 year term • Conventional Agency LIBOR ARM (5/1, 7/1 and 10/1) • 30 year term • Conventional Agency LIBOR ARM Interest Only (5/1, 7/1 and 10/1) • 30 year term

  46. Max LTV / CLTV Mortgage Insurance

  47. Highlights of the Program

  48. INTEREST RATE, FEES, MARKETING & SUPPORT Interest Rate Allowable Points Fees / Costs Marketing Support 49 8/20/2014

  49. Interest Rate Interest Rates for the MCM & Flexible programs are available on the FMC website: OR From your A/E