VA Refinance Certification Job Aid

VA Refinance Certification Form Job Aid

This job aid includes a representation of Citizens' VA Refinance Certification form on pages 1 and 2, along with links to instructions for completing each field on the form.

1

Date:

1

Loan No: 1

2

Veteran:

2

Spouse:

2

3

Lender:

4

Property:

5

Loan Type Being Refinanced:

5A

6

Estimated Payoff:

7

If Paying off Subordinate Mortgages, Estimated Payoffs (Type II only)

8

New Loan's Total Loan Amount:

Estimated Value

5B

Section 1: Comparison: Old Loan vs. New Loan Old Loan

New Loan

Net Tangible Benefit

9

Loan Amount

1

Interest Rate

9A

9A

10

10

10

1

Remaining Term in Months

1

Fixed Rate or ARM

13

Principal & Interest

14

LTV

15

Monthly Mortgage Insurance on Loan Being Paid Off

16

Monthly Residual Income

11 12A 13A 14A 15A 16A

11

Choose One

13 14B

16B

11 Fixed 12

13 14 15 16

17

Total of all Payments

17A

17B

Loan Being Refinanced is an

18

Interim Loan Used to Construct,

18A Choose One

18

Alter, or Repair the Home

Original Issue Date: 02/08/2019 Last Revision Date: 05/03/2019 Last Reviewed Date:02/08/2019

VA Refinance Certification Form Job Aid For Wholesale Customers Only

Page 1 of 7

I understand that by refinancing my home, I will be reducing the equity in my home by $19A . The remaining 19

equity in my home after this refinance is $19B

Section 2: Total Costs for the New Loan

Closing Costs (Includes all financed, paid with lender credit, and

20

POC;

does not include prepaids, VA Funding Fee)

21

Total Loan Amount

-

22

Discount Points

-

23

Less Lender Credit Toward Allowable Closing Costs

24

Estimated Total Closing Costs for the New Loan:

$

-

25

I understand that I will pay approximately $

-

in total closing costs.

26

I also understand that with the estimated $

-

in monthly savings on

my principal and interest payment, that it will take approximately

27

recoup the estimated costs of the new loan.

months, or

years to

Lender's Certification:

Lender hereby certifies that the recoupment period for all fees does not exceed 36 months from the date of loan

28

closing.

________________________

________________

Lender

Date

Section 3: Veteran's Certification of Receipt & Understanding

By signing below, I acknowledge that I have received the preliminary information on this form within three days

of my application, and I understand and agree to the effect of this refinance on my home equity, loan payments,

and interest rate.

29

__________

_____________________

________

Veteran

Date

Spouse

Date

Original Issue Date: 02/08/2019 Last Revision Date: 05/03/2019 Last Reviewed Date:02/08/2019

VA Refinance Certification Form Job Aid For Wholesale Customers Only

Page 2 of 7

Field Name

1

Date & Loan No.

2

Veteran & Spouse

3

Lender

4

Property

Explanation ? 1A: Initial disclosure: The document should be dated the same date as the

initial Loan Estimate (LE). ? 1A: Final disclosure: The document should be dated the date the document

was completed. ? 1B: Enter Citizens' loan number.

? 2A: Enter the veteran's name. ? 2B: Enter the spouse's name, if applicable.

Enter the lender's name.

Enter the full physical address for the subject property.

5

Loan type Being Refinanced & Estimated Value

? 5A: Complete the loan type of the loan being refinanced. ? 5B: Initial disclosure: Enter the estimated property value. ? 5B: Final disclosure: Enter the appraised value.

6

Estimated Payoff

Enter the estimated payoff of the loan being refinanced. (This information can be found on the credit report or payoff statement.)

If Paying off Subordinate

Enter the estimated payoff(s) of any subordinate liens being paid off with the new

7

Mortgages, Estimated

loan proceeds. (This information can be found on the credit report or payoff

Payoffs (Type II only)

statements.)

8

New Loan's Total Loan Amount

Enter the Total Loan Amount (including any financed portion of the funding fee) of the new loan. This information should match the 1003 and registration/lock.

Section 1: Comparison: Old Loan vs. New Loan Field Name

Explanation

9

Loan Amount

? 9A: This information populates from the value in the Estimated Payoff field. ? 9B: This information populates from the value in the New Loan's Total Loan

Amount field.

10

Interest Rate

11

Remaining Term in Months

? 10A: Enter the interest rate on the existing loan. o This information may be found on the existing note.

? 10B: Enter the interest rate on the new loan. o This information should match the 1003 and registration/lock.

? 10C: If the interest rate on the new loan is lower than the interest rate on the old loan, the Net Tangible Benefit field will populate with "Yes"; otherwise, it will be "No".

? Type I fixed to fixed rate refinance: The interest rate must be reduced by 0.50% or more when the new loan is equal to or less than the payoff of the old loan.

? 11A: Enter the number of months remaining for the loan being paid off. o This information may be found on the existing note or credit report.

? 11B: Enter the loan term in months for the new loan. o This information should match the 1003 and registration/lock.

? 11C: If the term of the new loan is shorter than the term of the loan being refinanced, the Net Tangible Benefit field will populate with "Yes"; otherwise, it will be "No".

Original Issue Date: 02/08/2019 Last Revision Date: 05/03/2019 Last Reviewed Date:02/08/2019

VA Refinance Certification Form Job Aid For Wholesale Customers Only

Page 3 of 7

12

Fixed Rate or ARM

? 12A: Click the drop-down and choose "Fixed" or "ARM" for the existing loan. o This information may be found on the existing note.

? 12B: If the existing was an ARM, then the Net Tangible Benefit field will populate with "Yes"; otherwise, it will be "No".

13

Principal & Interest

? 13A: Enter the principal and interest (P&I) payment on the existing loan. o This information may be found on the note or monthly mortgage statement.

? 13B: Enter the P&I payment on the new loan. o This information should match the "Proposed" P&I payment on the 1003.

? 13C: If the P&I on the new loan is less than the P&I payment on the old loan, then the Net Tangible Benefit field will populate with "Yes"; otherwise, it will be "No".

Field Name

14

LTV

Explanation

? 14A: The LTV will auto-calculate for the old loan based on the Estimated Payoff of the old loan and the Estimated Value fields.

? 14B: The LTV will auto-calculate for the new loan based on the New Loan's Total Loan Amount and the Estimated Value fields.

? 14C: If the LTV on the new loan is 90% or less, then the Net Tangible Benefit field will populate with "Yes"; otherwise, it will be "No".

? 15A: Enter the monthly mortgage insurance (MI) on loan being paid off. If

15

Monthly Mortgage Insurance on loan being paid off

the old did not have MI, enter "0". ? 15B: If the new loan eliminates monthly mortgage insurance, whether public

or private, then the Net Tangible Benefit field will populate with "Yes";

otherwise, it will be "No".

16

Monthly Residual Income

? 16A: Utilizing the VA Loan Analysis complete the following calculation to determine the old loan's monthly residual income:

Line 41. Total Net Effective Income minus the original loan's Total Mortgage Payment (P&I), taxes, insurance, monthly mortgage insurance, special assessments, maintenance & utilities, and HOA dues.

o "Line 41. Total Net Effective Income" is based on the income and debts & obligations verified for the new loan

o The taxes, insurance, special assessments, maintenance & utilities, and HOA dues can be based on the new loan when determining the residual income for the old (original) loan.

? 16B: The new loan's monthly residual income would be line 43: Balance Available for Family Support on the VA Loan Analysis (Form 26-6393). o If the taxes and/or insurance amounts change between the application and closing date of the new loan, the new tax and insurance amount must be used on the final form when determining the current and new residual income calculations. o A pop-up message will provide additional guidance if the tax and insurance amounts change prior to the closing date.

Original Issue Date: 02/08/2019 Last Revision Date: 05/03/2019 Last Reviewed Date:02/08/2019

VA Refinance Certification Form Job Aid For Wholesale Customers Only

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17

Total of all Payments

The worksheet will auto-calculate and determine the total the veteran will have paid (Total of all payments field) after making all payments (P&I) and mortgage insurance, as scheduled, for both the refinancing loan and the loan being refinanced by taking the Remaining Term in Month multiplied by the P&I (and MI, if applicable).

18

Loan being refinanced is an interim loan used to construct, alter, or repair the home

? 18A: Select "Yes" if the loan being refinanced is an interim loan used to construct, alter, or repair the home; otherwise, complete "No".

? 18B: If the loan being refinanced is an interim loan used to construct, alter, or repair the home, then the Net Tangible Benefit field will populate with "Yes"; otherwise, it will be "No".

? 19A: This blank will auto-populate with the reduction in equity of the

19

I understand that by refinancing my home, I will be reducing the equity in my home by $TBD. The remaining equity in my home after this refinance is $TBD or TBD%.

subject property, if applicable. The calculation will be New Loan's Total Loan Amount minus Estimated Payoff. If there is no reduction in equity, then $0 will be auto-completed.

? 19B: This blank will auto-populate with the remaining equity in the subject property after the refinance as a dollar amount. The calculation will be Estimated Value minus New Loan's Total Loan Amount.

? 19C: This blank will auto-populate with the remaining equity in the subject property as a percentage. The calculation will be the dollar amount of the

remaining equity in my home divided by Estimated Value.

Section 2: Total Costs for the New Loan

Note: This section applies and will be visible if the Loan Type Being Refinanced is "VA" and loan is a Type I cash out refinance. A loan is categorized as a Type I cash out refinance when the New Loan `s Total Loan Amount is less than the Estimated Payoff. Otherwise, this section will be a blank gray box and not applicable.

Field Name

Explanation

20

Closing Costs

Enter all closing costs associated with the transaction (This includes all financed closing costs, closing costs POC, and any closing costs paid by the lender. This does not include pre-paids (interest and escrows), discount points, or the funding fee.)

? Initial disclosure: This information should match the LE. ? Final disclosure at closing: This information should match the final CD as

outlined below.

Field Name

Explanation

21

Total Loan Amount

This field will auto-populate with the amount in the New Loan's Total Loan Amount field.

22

Discount Points

Enter percentage of discount points being charged.

? Initial disclosure: This information should match the LE. ? Final disclosure at closing: This information should match the final CD as

outlined below.

Enter the lender credit for the new loan.

23

Less Lender Credit toward allowable closing costs

? Initial disclosure: This information should match the LE. ? Final disclosure at closing: This information should match the final CD as

outlined below.

24

Estimated Total Closing Costs for the New Loan

This field auto-calculates the total of the closing costs, discount points, and funding fee, less the amount of any lender credit.

Original Issue Date: 02/08/2019 Last Revision Date: 05/03/2019 Last Reviewed Date:02/08/2019

VA Refinance Certification Form Job Aid For Wholesale Customers Only

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