First-time Homebuyer Loan Programs
left000July 2013Rapid RefinanceProgram Guidelines OverviewVHDA Rapid Refinance GuidelinesEligible Loans to be RefinancedVHDA Interest Only loans with rates at 6.00% or greater. Loans that have converted will also be eligible. Borrower(s) must provide originating lenders with the letter from VHDA Loan Servicing indicating their eligibility. *This letter must be received prior to originating the refinance loanOccupancyOwner Occupied only AppraisalNot RequiredAcceptable Pay HistoryLoan must be current at the time of loan closing. Borrowers no more than two months past due may bring their loan current at closing by including past due payments in the new loan up to $5,000. CreditNo minimum credit score – lenders must obtain a credit report to identify judgments or liens that would impact our first lien position. Credit scores are to be provided if available.QualifyingThis is a no credit qualifying loan – there are no maximum ratios.Loan to ValueNALoan Term30 years only Maximum IncomeNA – Income limits do not apply. Disclose income on the loan application (1003) or the VHDA Refinance Income Certification form.VHDA Affidavits, Tax Returns, and RidersVHDA Program Disclosure and Affidavit of Borrower and Seller, tax returns, and VHDA Rider to Conventional Deed of Trust are not required.Recapture TaxLoan is not subject to recapture.Financed Closing CostsBorrowers will receive a 1% lender credit toward closing costs. In addition up to $3,000 of closing costs may be financed in the new loan.Maximum Loan AmountCurrent loans – Unpaid principal balance and up to $3,000 in closing costsDelinquent loans – Unpaid principal balance plus 2 months past due payments and the closing costs may not exceed $5,000. Note: Under no circumstances may the financed closing costs exceed $3,000Cash Back at ClosingCash back to borrower at closing is not allowed.Mortgage Insurance PremiumsNAAUS approvalNAEligible Lenders/Lender CompensationAll VHDA-approved lenders are eligible to originate these loans. Lenders will receive a 1% premium pricing fee and 1% service release fee. Lender Liability ResponsibilityThe lender will not be held responsible for the performance of this loan unless there is fraud or material misrepresentation. The lender must ensure the new 1st mortgage is in valid 1st lien position.Modified LoansLoans with a prior modification will be eligible for refinance. ProhibitionThe originating lender must ensure that the loan price does not exceed the average prime offer rate for a similar transaction by 1.5 or more percentage points causing the loan to be a “Higher Priced Mortgage Loans” HPML.Contact VHDA Loan Reservations if the loan results in HPML rate spread. Please note: The interest rate offered on this product is higher than typical VHDA loan programs due to its source of funding (taxable bonds) and no MI.ProceduresHomebuyer EducationNot RequiredLock–In PolicyLoans are locked in on VHDA online reservation systemLoan must close (not disburse) within 60 days of reservation (extensions will be considered)$120 reservation fee is not requiredIf difficulty is encountered when locking loan related to maximum income limit, contact VHDA Loan ReservationsInput the new loan amount in the appraised value field if the original appraised value is unknownRates will be published on Rate Lock OptionsRapid Refi: Only one rate lock optionRapid Refi-Lock: (-1) +0 (1% lender credit to borrower)Approval ProcessLoans will not be sent to VHDA for preliminary underwriting or closing review for Delegated and Non-delegated lenders. All lenders will fax the “Rapid Refi Approval Notice” along with the eligibility letter provided to the borrower by VHDA Loan Servicing to VHDA prior to approval of loan. New Escrow AccountA new escrow account must be established. A refund of the current escrow account will be sent to the borrower after the refinance has been completed and payoff of the original loan is received. When establishing the new escrow account, include the amounts necessary to pay the hazard premium and taxes in the month prior to the due date. A two-month cushion is required. The borrower is not required to obtain a new hazard policyTax Service FeeA new tax service fee in the amount of $45.00 will be deducted from the purchase proceeds. Flood DeterminationA new flood determination is requiredLoan DeliveryLoans must be delivered to VHDA for purchase within 10 calendar days of disbursement. Submit the file in accordance with the Rapid Refi Loan Submission Checklist and the VHDA Loan Servicing Checklist.AssignmentVHDA does not allow MERS. An Assignment of the Deed of Trust is required.Loan Balance and Pay-Off InformationFax request for loan payoff to 804-343-8720. Indicate that this is a VHDA to VHDA refinance. Attach borrower’s authorization. Please allow at minimum 48 hours for receipt of loan payoff information. With the customer’s authorization, lenders may use the VHDA Customer Service automated voice system to obtain current balance information. The last 4 digits of the borrower’s social security and property zip code will be required. Call 1-800-235-6938, and press option 1. Subordination of other Second MortgageThe lender must ensure that VHDA’s 1st mortgage is in 1st lien position and appropriately reflected on the title policy. Forms and DocumentsAll VHDA specific forms and documents required for this program are available under the Forms and Documents section on .Rescission NoticeRequiredFundingThe originating lender will fund the new refinance and submit to VHDA for loan purchase under standard procedures.Disclosures The originating lender is responsible for all applicable disclosures.Program AvailabilityRapid Refi Lock-in’s will be available beginning July 1, 2013 through September 30, 2013 (unless program is extended) ................
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