mortgage basics: part 1
TRANSCRIPT
Back to Basics:Mortgage Lending
101Part #1October 9, 2015
Emily C IngramNew American Funding
Who is Emily C Ingram?• Local mortgage lender with New
American Funding• 14+ years experience • Loan originator, processor, and
underwriter• Bachelor’s degree in mathematics• Board member, Jefferson Co Home
Builders Association• Board member, Real Estate
Professionals for Affordable Housing• Occasionally skips work to go sailing.
Obligatory Disclosures
• I’m pretty smart, but I don’t know everything.• Change is inevitable.
Objectives
• Discuss types of mortgage lenders.• Recognize categories of mortgage products.• Identify potential red flags on a purchase &
sale agreement.
Types of Mortgage LendersOrigination Underwriting Funding Servicing
Depository Institution X X X XMortgage Bank/Lender X X X XCorrespondent Lender X X X
Mortgage Broker X
Categories of Mortgage Loans
• Conventional ConformingFNMA / FHLMC
• GovernmentFHA / VA / USDA
• Conventional Non-ConformingJumbo Loans / Funky Properties / Funky People
Conventional Conforming• Who is Fannie Mae & Freddie Mac?• Guidelines established by FNMA and FHLMC• Popular vanilla loan choice• Make sure your lender can choose!
The GSEs asset holdings – either through mortgage securitizations or direct portfolio holdings – have increased from approximately 7% of total residential mortgage market originations in 1980 ($78 billion) to 46.7% in 2010 ($5.3 trillion).- Federal Housing Finance Agency
Features & Benefits“Standard”
Conventional ConformingMy CommunityHome Possible
Minimum Down Payment 5% 3%Up Front Mortgage Ins private MI required with
< 20% downlower private MI
requirementsMonthly Mortgage Ins
Income Limits none $57,900 – 66,585
Property Type SFR, 2-4 units, manuf, condo SFR, condoOccupancy primary, 2nd, non owner primaryInterested Party Contribution 2% - 9% 3%Max Loan Amount $417,000 $417,000Max DTI 45% 43-45%Credit Score 620 660FTHB Restriction no yes and noHome Buyer Education not required required
Interested Party ContributionsOccupancy Down Payment Max Contribution
Primary/2nd
< 10% 3%
24.99 – 10% 6%
> 25% 9%
Investment all 2%
Government - FHA
• Who is FHA?• More lenient guidelines• Have a bad rap• Guidelines changed in September
Features & BenefitsFHA
Minimum Down Payment 3.5%Up Front Mortgage Insurance 1.75%Monthly Mortgage Insurance 0.85%Income Limits noneProperty Type SFR, 2-4 units, manuf, condo
Occupancy primaryInterested Party Contribution 6%Max Loan Amount $384,100Max DTI 45%’ishCredit Score 580FTHB Restriction noHome Buyer Education not required
Government - VA
• Who is VA• Eligible veterans (COE)• Big draw = 0% down• Ineligible fees• Tougher appraisals
Features & BenefitsVA
Minimum Down Payment 0%Funding Fee (MI) 0 – 3.30%Monthly Mortgage Insurance 0%Income Limits noneProperty Type SFR, 2-4 units, manuf, condo
Occupancy primary
Interested Party Contribution up to 4% for prepaids and funding fee
Max Loan Amount noneMax DTI 45%’ishCredit Score 580FTHB Restriction noHome Buyer Education not required
Government - USDA
• Who is USDA?• Rural properties / income limits• No down payment• Allow additional time for closing• No income producing properties
Features & BenefitsUSDA
Minimum Down Payment 0%Guarantee Fee (MI) 2.75%Monthly Mortgage Insurance 0.5%Income Limits $75,650Property Type SFR, condo
Occupancy primaryInterested Party Contribution 6%Max Loan Amount noneMax DTI 29/41% (32/44%)Credit Score 620FTHB Restriction noHome Buyer Education not required
Underwriting the P&S
complete property address
everyone on the mortgage must be listed
no personal property
sourced and seasoned
communication is keywithin 60 days
all inclusive
Occupancy Down Payment Max Contribution
Primary/2nd
< 10% 3%
24.99 – 10% 6%
> 25% 9%
Investment all 2%
Interested Party Contributions
X
1) Replace the missing shingles on the roof.2) Repair the leak around the bathroom skylight.3) Secure the loose railing around the back deck.
XReduce purchase price by $1.95
X
Per the home inspection:1) Replace the missing shingles on the roof (page 6, paragraph 3.2)2) Repair the leak around the bathroom skylight (page 8, paragraph 4.1)3) Secure the loose railing around the back deck (page 12, paragraph 2.4)
X
Why Refer to Emily C Ingram?(AKA shameless self promotion)
• Depth of experience• Go the extra mile• Not focused on volume• Better customer service
Contact Me!
www.facebook.com/emilycaryl
www.linkedin.com/in/emilycaryl
www.slideshare.net/EmilyCIngram1