PDF TDHCA LENDER GUIDE

*Starting February 1, 2019, MCCs will only be offered in combination with a My First Texas Home mortgage loan. MCCs reserved as a stand-alone option prior to February 1, 2019, will be honored (assuming receipt of compliance approval).

TDHCA LENDER GUIDE

My First Texas Home My Choice Texas Home Texas Mortgage Credit Certificate

May 2019

REVISIONS TABLE

PUBLISHED OCTOBER 17, 2018 REVISED MAY 1, 2019

Section Page

Revision

8.1

18 Update to MCC Issuance Fee of $500 effective May 1, 2019

Date

05/01/2019

1

9 Update "Texas Mortgage Credit Certificate" to remove the reference to "up to 04/12/2019

$2,000".

5.1

15 Remove "Example" and the reference to "up to $2,000".

04/12/2019

5.2

15 Removed tiered structure table and updated with 25% and 20% MCC credit 04/12/2019

rate.

5.4

16 Added the 25% and 20% MCC credit rate. Added Example.

04/12/2019

All Header added to include "*Starting February 1, 2019, MCCs will only be offered in combination with a My First Texas Home mortgage loan. MCCs reserved as a stand-alone option prior to February 1, 2019, will be honored (assuming receipt of compliance approval)."

02/01/2019

2.1

9 Verification of First-time homebuyer status ? updated to include Note 02/01/2019

on February 15th requirement on MCC.

7.1

18 Rates/Offerings ? removed Sample Rate Notice

02/01/2019

11.3

23 Closing and Funding of Down Payment Assistance ? Revised compliance

02/01/2019

delivery to eHousingPlus

11.4

23 Compliance File for all programs ? Added "See Section 16.2 Attachments 02/01/2019

(Pages 21-24) ? eHousingPlus NEW INSTRUCTIONS FOR THE DELIVERY

OF COMPLIANCE FILES, FEES AND CORRECTED DEFI'S."

16.2

29-32 Added Attachments ? NEW INSTRUCTIONS FOR THE DELIVERY OF

COMPLIANCE FILES, FEES AND CORRECTED DEFI'S

2.3

10 Update to include "The income of the Cosigner is not required to be

considered when determining income eligibility for the purposes of the

program."

2.2

10 Updated link to include 2-Unit Purchase Price Limits Table

3.2

11 Update to include "Triplexes and fourplexes and shares in housing

cooperatives are not eligible for the Program(s)."

02/01/2019 11/01/2018

10/25/2018 10/25/2018

3.7

12 Updated link to include 2-Unit Purchase Price Limits Table

10/25/2018

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TABLE OF CONTENTS

THE TDHCA PARTNERSHIP TEAM .......................................................................................6 Contacts .................................................................................................................................8 Section 1 - Program Summary ..............................................................................................9 Section 2 ? Mortgagor Eligibility...........................................................................................9 2.1 First Time Homebuyer Requirement................................................................................9 2.2 Maximum Income (Family Income)................................................................................10 2.3 Cosigners and Guarantors ............................................................................................10 2.4 Homebuyer Education...................................................................................................11 2.5 Recapture Tax...............................................................................................................11 Section 3 - Eligible Properties.............................................................................................11 3.1 Location ........................................................................................................................11 3.2 Type..............................................................................................................................11 3.3 Ineligible properties .......................................................................................................12 3.4 Principal Residence Requirement .................................................................................12 3.5 Residency Requirement ................................................................................................12 3.6 Usage of Residence in a Trade or Business..................................................................12 3.7 Acquisition Cost ............................................................................................................12 3.8 Targeted Areas .............................................................................................................12 Section 4 ? Loan Eligibility and Underwriting....................................................................13 4.1 Loan types ....................................................................................................................13 4.2 FICO and DTI requirements ..........................................................................................13 4.3 Mortgage Loan Payments and Terms ...........................................................................13 4.4 Down Payment Assistance Loan...................................................................................13 4.5 2nd loan Disclosure Requirements .................................................................................14 4.6 New Mortgage...............................................................................................................14 4.7 Desktop Underwriting ....................................................................................................14 4.8 Buydowns ......................................................................................................................14 4.9 Assumptions ..................................................................................................................15 4.10 Refinances ....................................................................................................................15 4.11 Prepayment...................................................................................................................15 Section 5 - The Texas Mortgage Credit Certificates Program (MCC)* ..............................15 5.1 What is a Texas Mortgage Credit Certificate? ...............................................................15 5.2 Texas MCC Tax Credit Rate .........................................................................................15 5.3 The Difference Between a "Tax Credit" and a "Tax Deduction" .....................................15 5.4 MCCs and the Federal Income Tax Mortgage Interest Deduction .................................16 5.5 How an MCC Holder Uses the MCC .............................................................................17

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5.6 When the MCC Credit Exceeds the Tax Liability ...........................................................17 5.7 Recapture of MCC Tax Credit .......................................................................................17 Section 6 ? Available Options .............................................................................................18 6.1 My First Texas Home ....................................................................................................18 6.2 My Choice Texas Home ................................................................................................18 6.3 Texas Mortgage Credit Certificate (Stand-alone)* .........................................................18 Section 7 - Available Funds and Rates...............................................................................18 7.1 Rates / Offerings ...........................................................................................................18 Section 8 ? Program Fees and Charges .............................................................................18 8.1 Program Fees ...............................................................................................................18 8.2 Lender Compensation ...................................................................................................19 8.3 Loan Origination / Discount Points / Closing Cost .........................................................19 8.4 Fees and Charges on the Closing Disclosure................................................................19 8.4 Extension Cost ..............................................................................................................19 Section 9 ? How to Become a Participating Lender ..........................................................20 9.1 Correspondent Lenders.................................................................................................20 9.2 Texas MCC Lenders* ....................................................................................................20 Section 10 ? eHousingPlus eHPortal / Loan Reservation .................................................20 10.1 TDHCA page on eHousingPlus, ...................................................................................20 10.2 eHPortal .......................................................................................................................21 10.3 Lender Training ............................................................................................................21 10.4 eHPortal User Credentials............................................................................................22 10.5 Qualify..........................................................................................................................22 10.6 Disclose .......................................................................................................................22 Section 11 ? Reservation, Compliance and Closing Steps ...............................................22 11.1 Reserving Funds ..........................................................................................................23 11.2 Underwriter ..................................................................................................................23 11.3 Closing and Funding of Down Payment Assistance......................................................23 11.4 Post-Closing.................................................................................................................23 Section 12 ? Modifications to Loan / MCC Reservation* ...................................................24 12.1 Changes in Applicant Name(s).....................................................................................24 12.2 Changes in Current Income..........................................................................................25 12.3 Changes in Purchase Price ..........................................................................................25 12.4 Changes in Loan Amount .............................................................................................25 12.5 Changes in Property Address.......................................................................................25 Section 13 ? Additional Provisions.....................................................................................25 13.1 Cancellation and Loan Reservation Expirations ...........................................................25 13.2 Penalties for Applicant Misrepresentation.....................................................................25

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13.3 Revocations of MCC ....................................................................................................26 13.4 Reissued MCCs ...........................................................................................................26 13.5 Replacement MCCs .....................................................................................................26 Section 14 ? MCC Record Keeping and Federal Report Filing .........................................27 14.1 Lender Reports ............................................................................................................27 14.2 TDHCA Reports ...........................................................................................................27 Section 15 ? Additional Income Guidance .........................................................................27 15.1 My First Texas Home / Texas Mortgage Credit Certificate Income Eligibility* ...............27 15.2 My Choice Texas Home Income Eligibility....................................................................28 Section 16 ? Forms / Affidavits / Attachments...................................................................28 16.1 Program Forms and Affidavits ......................................................................................28 16.2 Attachments .................................................................................................................30

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