CalHFA Conventional Loan Program - CALIFORNIA HOUSING FINANCE AGENCY - LAST REVISED: MARCH 1, 2019 - CA.gov
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CALIFORNIA HOUSING FINANCE AGENCY
CalHFA
Conventional
Loan Program
LAST REVISED: MARCH 1, 2019CALHFA CONVENTIONAL LOAN PROGRAM
Table of Contents
I. Program Summary 1
II. Eligibility 1
a. Borrower Requirements
b. Eligible Homebuyers
c. Homebuyer Education
d. Owner Occupancy
e. Property Requirements
f. Lender Eligibility Requirements 3
g. Broker Eligibility Requirements
III. Underwriting & Compliance 4
a. Transaction type
b. Term
c. LTV and CLTV
d. Maximum Loan Amount
e. Fannie Mae High Balance Loan Limits
f. Maximum Sales Price Limits
g. Income & Sales Price Limits
h. Income Requirements
i. Qualifying Ratios
j. Minimum Credit Score
k. Automated Underwriting 5
l. Sales Concessions/Contributions
m. Miscellaneous Lakeview Loan Servicing Underwriting Guidelines
n. Mortgage Insurance 6
o. Mortgage Insurance Options
p. Genworth Mortgage Insurance Rates
IV. Subordinate Financing 7
a. CalHFA Subordinate Financing
b. Borrowers affected by natural disasters in California
c. Non-CalHFA Subordinate
d. Other Programs and Assistance 8
V. CalHFA Loan Process (Submission, Approval & Purchase) 8
VI. Fees
VII. Reservations, Rate Locks & Extensions 9
a. Reservations and Rate Locks
2019 CALIFORNIA HOUSING FINANCE AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) iiCALHFA CONVENTIONAL LOAN PROGRAM
Table of Contents (cont.)
VIII. Reservations, Rate Locks & Extensions (cont.) 10
IX. Basic Home Protection Coverage 10
a. Mandatory Home Warranty Insurance Coverage
X. Pre-Closing Loan Submission 10
a. Loan Submission Process
b. Forms
XI. Post-Closing Loan Delivery & Purchase 11
a. All CalHFA First Loans:
b. All CalHFA Subordinate Loan(s):
c. Forms 12
XII. Frequently Asked Questions 13
a. Sales Tools And Marketing Materials 17
2019 CALIFORNIA HOUSING FINANCE AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) iiiCALHFA CONVENTIONAL LOAN PROGRAM
Program Summary
The CalHFA Conventional program is a Fannie Mae HFA Preferred™ fully amortized
thirty (30) year fixed interest rate first mortgage. This loan may be combined with
either the MyHome Assistance Program (MyHome) or the School Teacher and
Employee Assistance Program (School Program). When no CalHFA down payment
and/or closing cost assistance subordinate loan programs are being used with the
CalHFA Conventional first mortgage loan, the first mortgage loan may be eligible for
a lower interest rate. See CalHFA Rate Sheet for details.
The CalHFA Conventional loan is not subject to Recapture Tax.
Eligibility
Borrower Requirements Owner Occupancy
Each borrower must • All borrowers must occupy the
property as their primary residence
• Be either a citizen or other National within sixty (60) days of closing
of the United States, or a “Qualified
Alien” as defined at 8 U.S.C § 1641 • Non-occupant co-borrowers are not
allowed
• Meet the credit, income and loan
requirements detailed in this • Non-occupant co-signers are not
program handbook, as well as allowed
CalHFA’s Lender Manual, Fannie
Property Requirements
Mae, the CalHFA-approved lender,
the mortgage insurer and CalHFA’s • Sales price of the home cannot
master servicer’s requirements exceed CalHFA’s sales price limits
established for the county in which
Eligible Homebuyers the property is located.
This program is available for both first-time • Property must be a single-family,
and non-first time homebuyers. one-unit residence, including con-
dominium/PUDs which are Fannie
Homebuyer Education Mae eligible and meet CalHFA’s
master servicer, Lakeview Loan
Homebuyer Education counseling is Servicing’s (LLS) guidelines. It is
required for one occupying first-time the responsibility of the lender and
homebuyer. Homebuyer Education is not not the master servicer to meet
required for non-first-time homebuyer(s). these guidelines.
• Online Homebuyer Education • Properties that meet Fannie Mae’s
through eHome™ Geographical Census Tract require-
• Face-to-Face Homebuyer Education ments as defined by the Federal
through NeighborWorks America or Information Processing Standards
through one of the HUD approved (FIPS) code may be eligible for a
Housing Counseling Agencies
(continued on next page)
2019 CALIFORNIA HOUSING FINANCE AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 1CALHFA CONVENTIONAL LOAN PROGRAM
Eligibility (cont.)
lower interest rate. Each FIPS code ›› All Leasehold Estate documen-
will identify the income requirement tation must be submitted to
for that property. CalHFA’s Master Servicer with
purchase package for review and
›› Use Fannie Mae’s HomeReady®
approval
Lookup tool for eligibility
• Community Land Trust (CLT)
»» If there is no income limit,
the borrower is eligible for the ›› CLT loans will only be accepted
lower rate. from a California Community
Land Trust Network (CA CLTN)
»» If there is an income limit, approved lender
the borrower’s income must
be less than the FIPS posted ›› Can be combined with either the
income limit to be eligible for MyHome or the School Program
the lower rate. »» MyHome and School Program
»» All borrowers must still meet loan amounts will be based
CalHFA’s income limits. on the leasehold sale price,
including any enforceable
Additional Property Guidelines restrictions on future re-sale
prices
• Accessory Dwelling Units (ADU),
Guest houses, “granny” units, and ›› All CLT documentation must be
“in-law” quarters are eligible submitted to CalHFA’s Master
Servicer with purchase package
›› The property must be defined as for review and approval
a one-unit property
›› Must follow Fannie Mae
›› Cannot be zoned for 2-4 units- guidelines
Multiple accessory units are not
permitted • Manufactured homes are permitted
per Fannie Mae MH Advantage and
›› Must meet investor guidelines Fannie Mae Standard MH guidelines
and city/county zoning with the following parameters:
ordinances
›› Minimum credit score: 660
›› Per investor guidelines – If rental
›› Singlewide manufactured homes
income from the ADU is used
are not eligible
for credit qualifying, CalHFA will
also use the gross rental income ›› Fannie Mae Desktop
for the compliance income Underwriter® (DU®) with
calculation Approve/Eligible Findings only
• Leasehold Estates ›› Leaseholds are not permitted
›› Must follow Fannie Mae ›› Appraisal for MH Advantage
guidelines requires picture of MH
Advantage Sticker
›› Not permitted with Manufactured
Homes (continued on next page)
2019 CALIFORNIA HOUSING FINANCE AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 2CALHFA CONVENTIONAL LOAN PROGRAM
Eligibility (cont.)
Fannie Mae Fannie Mae »» Please see Lakeview Loan
MH Advantage Standard MH Servicing website for required
Max LTV/CLTV: Max LTV/CLTV: documents
97%/105% 95%/105%
• Property Flipping
Desktop Underwriter ® (DU®)
Use with Fannie Mae HFA PreferredTM only ›› Follow the Fannie Mae first-
Select Manufactured Home mortgage underwriting guidelines
Select MH Advantage
or Manufactured Home:
in the Subject
Condo/PUD/Co-op in the CalHFA requires a copy of all appraisals as
Property Type field
Subject Property Type field
required by Fannie Mae.
• Co-ops are not permitted When multiple appraisals are required,
• Non-permitted additions/alterations CalHFA will base the subordinate loan
must follow Fannie Mae guidelines amount(s) on the lesser of the sales price
or lowest appraised value.
• Lot size cannot exceed five (5)
acres maximum Lender Eligibility Requirements
• Properties must meet the To be eligible for this program lenders
requirements of Fannie Mae and the must be approved by:
California Health and Safety Code
• CalHFA
• Refer to the Lakeview program
matrix for their Disaster Policy • Fannie Mae
›› See Lakeview Correspondent • Lakeview Loan Servicing (LLS),
Lending website for details CalHFA’s master servicer. To seek
LLS approval contact the the
• Escrow Holdbacks will be allowed Counterparty Risk Management
for minor outstanding repairs not team at
completed prior to loan closing CRM@Lakeviewloanservicing.com
›› The Property must be habitable • Genworth Mortgage Insurance
and safe for occupancy at the To seek a Genworth Master Policy,
time of loan closing you may apply online
›› Lenders and/or closing agent will Broker Eligibility Requirements
be responsible for managing and
disbursing holdbacks Mortgage brokers can find a list of partici-
pating CalHFA-approved wholesale lenders
›› Lender must deliver loans that on CalHFA’s mortgage broker webpage
were originated in accordance
with FHA and Fannie Mae
guidelines
2019 CALIFORNIA HOUSING FINANCE AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 3CALHFA CONVENTIONAL LOAN PROGRAM
Underwriting & Compliance
Transaction type 1. CalHFA Income Limits
Purchase transactions only 2. Sales Price Limits
Term Income Requirements
Up to 30 years Lenders are required to calculate income
to qualify borrower(s) for loan approval
LTV and CLTV using Fannie Mae guidelines. CalHFA will
use the lender’s credit qualifying income
Loan-to-Value (LTV) cannot to determine if the loan exceeds the
exceed 97.00% maximum program income limit. Income
Combined Loan-to-Value (CLTV) cannot not used by the lender for credit qualifying
exceed 105.00% will not be used by CalHFA.
Additional subordinate loan(s) and grants MAXIMUM PROGRAM INCOME LIMITS
may also be eligible to be layered with the The income of all borrowers cannot
CalHFA Conventional loan. exceed the published CalHFA income
limits detailed in this program hand-
Maximum Loan Amount
book established for the county in
The maximum first mortgage loan amount which the property is located.
cannot exceed Fannie Mae loan limits.
When multiple CalHFA loan programs
are used in combination, the most
Fannie Mae High Balance Loan Limits
restrictive income limits will apply.
All loans with a loan amount exceeding
$484,350 up to $726,525 will be subject Qualifying Ratios
to an additional fee. See CalHFA rate sheet
The maximum total Debt-to-Income (DTI)
for applicable fees.
ratio cannot exceed 45.00% regardless of
All Fannie Mae High Balance Loan fees automated underwriting decision or com-
will be net funded at the time of first mort- pensating factors. A MCC may not be used
gage purchase by the master servicer. for credit qualifying purposes.
Maximum LTV for Fannie Mae High Minimum Credit Score
Balance Loan Limits: 95.00%
The minimum credit score is 640
Maximum Sales Price Limits
• Manufactured Housing: 660
The Sales Price of the home cannot ex-
• A borrower with no credit score may
ceed CalHFA Sales Price Limits for the
be eligible as long as an occupant
county in which the property is located.
borrower(s) has a credit score that
meets the minimum representa-
Income & Sales Price Limits
tive credit score requirement and
The following reference materials disclose receives an approve eligible findings
income and sales price limits by county:
(continued on next page)
2019 CALIFORNIA HOUSING FINANCE AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 4CALHFA CONVENTIONAL LOAN PROGRAM
Underwriting & Compliance (cont.)
(When one borrower has no credit • Manual Underwriting is not
score, mortgage insurance will permitted
use the middle credit score of the
borrower with a score to determine Sales Concessions/Contributions
mortgage insurance rates)
Concessions/contributions as per Fannie
›› Non-traditional credit is not Mae guidelines except for the following:
accepted • Payment of condominium fees
• When all borrowers have a credit • Personal property
score, they must all meet the mini-
mum representative credit score • Down payment assistance
requirement. The middle score of
• See Lakeview Correspondent
the lowest-scoring borrower should
Lending website for additional
be used to determine eligibility
requirements
›› If a tri-merged credit report is
used, use the middle score Miscellaneous Lakeview Loan
Servicing Underwriting Guidelines
›› If a merged credit report only
returns two scores, use the lower • Credit Underwriting is the responsi-
score bility of the originating lender
›› If a merged credit report only • Underwriters should:
returns one score, that score
›› Make sound credit decisions
must be used
›› Assure data integrity
Automated Underwriting
›› Include all necessary documents
Acceptable Automated Underwriting in support of the underwriting
Systems (AUS): decision
• Fannie Mae Desktop Underwriter • Tax transcripts are required for all
(DU®) with an Approve/Eligible years that income is used for credit
recommendation qualifying
›› HFA Preferred must be selected • Non-arm’s length transactions must
in the Community Lender be fully disclosed
Product Field
• Appraiser must meet all master
»» CalHFA subordinate
servicer guidelines, see Lakeview
loans must be entered as
Correspondent Lending website for
Community Seconds
details
›› Freddie Mac Loan Prospector
(LP®) and other customized ›› UCDP submission Summary
automated underwriting systems Reports from both Fannie Mae
are not permitted and Freddie Mac are required.
Lakeview Loan Servicing will not
(continued on next page)
2019 CALIFORNIA HOUSING FINANCE AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 5CALHFA CONVENTIONAL LOAN PROGRAM
Underwriting & Compliance (cont.)
purchase any loan that includes Mortgage Insurance Options
the recently added proprietary
messages that indicate 100% • Either borrower paid monthly, split
of the loans submitted with premium or single premium mort-
appraisals from an identified gage insurance is acceptable
appraiser will be reviewed or ›› Financed mortgage insurance
Fannie Mae will not accept premium must be included in
appraisals from an identified the LTV and CLTV
appraiser
LTV Coverage
• 2-1 temporary buydowns are 95.01-97% LTV 18%
permitted as per Fannie Mae and 90.01-95% LTV 16%
master servicer guidelines 85.01-90% LTV 12%
›› Loan must be credit qualified at 80.01-85% LTV 6%
Note rate
Genworth Mortgage Insurance Rates
• In the case of conflicting guidelines,
lender must follow the more restric- For information regarding Genworth
tive to meet the credit, income Mortgage Insurance’s current HFA MI
limits, total debt-to-income ratio rates, please see Rate Express on the
and loan and property requirements Genworth Mortgage Insurance website.
of CalHFA, Fannie Mae, mortgage
insurer, lender or master servicer
All loans are subject to audit by both
CalHFA and Lakeview Loan Servicing.
Mortgage Insurance
• Mortgage insurance is required for
all loans that are 80.01% LTV or
higher
• Mortgage insurance must be
ordered through Genworth Mortgage
Insurance Company using their
Housing Finance Agency (HFA) MI
rates
2019 CALIFORNIA HOUSING FINANCE AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 6CALHFA CONVENTIONAL LOAN PROGRAM
Subordinate Financing
CalHFA Subordinate Financing Borrowers affected by natural
disasters in California
This program may be layered with the fol-
lowing down payment and/or closing cost To be eligible for CalHFA Financing:
assistance options for first-time homebuy-
• Previous property must be located
ers only; unless the borrower has been
in an area declared as a Major
affected by a California natural disaster as
Disaster and posted on the Federal
described below
Emergency Management Agency
• MyHome Assistance Program (FEMA) website
›› May be used for closing cost • Previous property must have been
and/or down payment assistance the borrower’s primary residence
›› In the case of conflicting guide- • Previous property must have been
lines, the lender must follow the destroyed or declared uninhabitable
more restrictive with supporting documentation sup-
plied from either (i) the insurance
›› Must be recorded in Second company or (ii) the local govern-
Lien Position ment jurisdiction
›› For full MyHome underwriting • Borrowers affected by a declared
guidelines and details see the Major Disaster are eligible to pur-
MyHome Program Handbook chase a new home using CalHFA
• School Teacher and Employee loan programs within three (3) years
Assistance Program (School of that Major Disaster’s declaration
Program) date
›› May be used for down payment Non-CalHFA Subordinate
assistance
This program may be layered with a
›› In the case of conflicting guide- Fannie Mae approved Community Seconds
lines, the lender must follow the program used for closing costs and/or
more restrictive down payment assistance per individual
requirements.
›› Must be recorded in Second
Lien Position • The locality subordinate loan must
meet Fannie Mae Community
›› For full School Program under-
Seconds guidelines
writing guidelines and details see
the School Program Handbook • The maximum CLTV must meet
CalHFA requirements
MyHome and School Program may not be
combined. • In the case of conflicting guidelines,
the lender must follow the more
restrictive
2019 CALIFORNIA HOUSING FINANCE AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 7CALHFA CONVENTIONAL LOAN PROGRAM
Subordinate Financing (cont.)
• Must be recorded in subordinate Other Programs and Assistance
lien position to CalHFA Subordinate
Financing This program may be layered with
Mortgage Credit Certificate (MCC). The
MCC credit may not be used for credit
qualifying purposes. In the case of
conflicting guidelines, the lender must
follow the more restrictive.
CalHFA Loan Process (Submission, Approval & Purchase)
The lender must upload to CalHFA’s MAS Upon receipt of the Notice of Commitment,
a fully approved loan package per CalHFA’s the lender is authorized to close the
Loan Submission Checklist for program loan(s). After closing, the lender will upload
policy, compliance review and desktop a closed first mortgage purchase package
underwriting validation. to CalHFA’s master servicer Lakeview Loan
Servicing CalHFA subordinate loan (i.e.
CalHFA will review loan files on a first- ZIP, MyHome or School Program) purchase
come, first-served basis. CalHFA reviewers package(s) to CalHFA for purchase.
will notify lenders of each conditional loan
approval, suspension and/or rejection via Lenders must submit applicable ZIP,
MAS. MyHome or School Program purchase
packages to CalHFA at the same time the
Suspended loan files will not be reviewed first mortgage is submitted to the master
until all suspense items are uploaded to servicer to ensure that the purchase of all
MAS. loans meet the rate lock expiration.
All loans must meet the rate lock expira-
tion date.
Fees
Loan Level Price Adjustment (LLPA) Lender Allowable Fees (Origination
& Processing)
• There are no LLPAs when using
HFA Preferred™ • Customary lender origination fees
not to exceed the greater of 3% of
Servicing Release Premium (SRP) the loan amount or $3,000
• Lenders will earn a 1.00% Service • Other customary third party fees
Release Premium to release servic- such as credit report fee, appraisal
ing to Lakeview Loan Servicing fee, insurance fee or similar settle-
(LLS) at time of purchase ment or financing cost
• LLS will purchase loans directly
from lender on a daily basis
(continued on next page)
2019 CALIFORNIA HOUSING FINANCE AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 8CALHFA CONVENTIONAL LOAN PROGRAM
Fees (cont.)
• In all cases the lender must meet • Funding fees paid by the borrower
federal and California lending laws or seller must be disclosed and
regarding fees and charges documented on the final Closing
Disclosure
Master Servicer Fees
• Other customary master servicer
• LLS funding fee is $250 per loan fees may apply
• Tax Service fee to LLS is $75 per • LLS will not purchase High Cost
loan Loans
• Life of Loan Flood Certificate fee to • Lenders should refer to their legal/
LLS is $10 per loan compliance department on how to
disclose fees
Reservations, Rate Locks & Extensions
Interest rates are available on the CalHFA • All CalHFA subordinate loan(s) will
Interest Rate page. Interest rates are sub- receive the same reservation, lock
ject to change at any time without notice. and purchase periods as the CalHFA
first mortgage
Reservations and Rate Locks
• Lender should factor in its
• Reservations with a floating rate own processing/underwriting
will be accepted from 6:00 a.m. to time frames, as well as CalHFA
11:59 p.m. Pacific Time, seven days compliance review, and master
a week servicer review for purchase time
frames when locking interest rates
• Rate locks will only be accepted
and submitting loan files
between the hours of 8:00 a.m. to
3:00 p.m. Pacific Time, Monday • Lenders may not lock a loan in
through Friday, excluding state-rec- MAS with an interest rate that
ognized holiday, and days that the is higher than the interest rate
U.S. financial markets are closed for reflected on the CalHFA Notice of
business. Only lenders with full MAS Commitment
access may lock the interest rate
• If the current rate is higher than
• Lenders will have the option to float the rate on the CalHFA Notice of
(90 days for existing/resale proper- Commitment, please resubmit all
ties or 120 days for new construc- updated loan documents at the
tion properties) or lock the interest higher rate including Approved/
rate for sixty (60) days for both Eligible DU® findings Transmittal
existing/resale properties and new Summary (1008) and final under-
construction properties writing approval for CalHFA’s
re-approval
(continued on next page)
2019 CALIFORNIA HOUSING FINANCE AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 9CALHFA CONVENTIONAL LOAN PROGRAM
Reservations, Rate Locks & Extensions (cont.)
Delivery Timeframes and Extensions: • Under no circumstances will
CalHFA extend a rate lock
• Files should be received by the period longer than 120 days for
master servicer by the 45th day both existing properties or new
or earlier, to ensure time to clear construction properties from the
conditions and purchase prior to original expiration date
rate lock expiration
• Please see the Rates & Reservation
• CalHFA offers rate lock extensions page for full details and FAQs
in 15 day increments up to a maxi-
mum of 120 days from the original
expiration date
Basic Home Protection Coverage
Mandatory Home Warranty Insurance • Home Warranty to be paid through
Coverage close of escrow
• CalHFA requires that all first-time • Home Warranty must be disclosed
homebuyer(s) obtain a one-year on Final Closing Disclosure or copy
home warranty protection policy of insurance declaration page will
be required
›› Non-first-time homebuyers are
not required to obtain a home • Exception to Home Warranty:
warranty protection policy
›› If borrower is purchasing a new
• The insurance must cover the fol- construction property from a
lowing items at a minimum: builder and the builder is provid-
ing the home warranty
›› Water Heater(s)
›› Borrower is not a First Time
›› Air Conditioning Homebuyer
›› Heating
›› Oven/Stove/Range
Pre-Closing Loan Submission
Loan Submission Process Forms
A lender makes reservations through The following forms will be needed when
CalHFA’s Mortgage Access System (MAS). submitting a CalHFA Conventional loan to
Refer to the Loan Submission Checklist for CalHFA:
minimum documentation requirements.
• CalHFA Borrower Affidavit
CalHFA Conventional loan submission
packages are to be sent electronically
through MAS.
2019 CALIFORNIA HOUSING FINANCE AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 10CALHFA CONVENTIONAL LOAN PROGRAM
Post-Closing Loan Delivery & Purchase
All CalHFA First Loans: • Loss Payee Clause:
• Use the master servicer Loan Lakeview Loan Servicing, LLC
Purchase Checklist located on the c/o LoanCare, LLC
Lakeview Correspondent Lending ISAOA/ATIMA
website to ensure you are submit- PO Box 202049
ting a complete and accurate Florence, SC 29502-2049
package.
• All loan deficiencies will be posted
• Notes are to be endorsed to on the client-facing website which is
Lakeview Loan Servicing, LLC accessible 24 hours a day
• Deeds of Trust are to be assigned to • All loans must be program approved
Lakeview Loan Servicing, LLC and deficiency free before they can
be purchased
›› All loans must be registered with
Mortgage Electronic Registration All CalHFA Subordinate Loan(s):
Systems (MERS) at the time
of delivery to Lakeview Loan • All CalHFA subordinate loans must
Servicing, LLC, and MERS be funded, delivered and purchased
transfer of beneficial rights of by CalHFA concurrently with the
servicing rights must be initiated first mortgage
by the Lender, to Lakeview Loan • CalHFA subordinate loan purchase
Servicing, LLC within 24 hours packages are to be sent electroni-
of loan purchase cally through MAS
›› Register via MERS: ›› Use the Loan Purchase Checklist
»» Investor: 1010298 Lakeview to ensure you are submitting a
Loan Servicing complete and accurate package.
»» Servicer: 1010298 Lakeview • Subordinate loan documents are to
Loan Servicing be drawn in lender’s name
»» Subservicer: 1000723 ›› Note to be endorsed to CalHFA
LoanCare LLC ›› MERS Deed of Trust must be
• CalHFA Conventional closed loan assigned to CalHFA
files are to be sent electronically to »» Loans are to be transferred
the master servicer via the Lakeview via Mortgage Electronic
Correspondent Lending website Registration Systems (MERS)
within ten (10) business days
»» Register via MERS:
• Logon link will be in the top right
section of the website • Investor: 1000645
California Housing Finance
Agency
(continued on next page)
2019 CALIFORNIA HOUSING FINANCE AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 11CALHFA CONVENTIONAL LOAN PROGRAM
Post-Closing Loan Delivery & Purchase (cont.)
• Servicer: 1000645 Forms
California Housing Finance
Agency Lender must use the following forms:
• Loss Payee Clause: 1. Most current version of standard
California Housing Finance Agency Conventional Fixed Rate Note
Its successor and/or assigns
2. Most current version of standard
Single Family Servicing – MS 980
Conventional Deed of Trust
500 Capitol Mall, Suite 400
Sacramento, CA 95814
3. Lender must also use other
applicable documents (e.g.,
PUD Rider, etc.)
4. Subordinate Deed of Trust
5. Subordinate Promissory Note
2019 CALIFORNIA HOUSING FINANCE AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 12CALHFA CONVENTIONAL LOAN PROGRAM
Frequently Asked Questions
What is the CalHFA Conventional Loan Does CalHFA Conventional allow
Program? additional subordinate financing?
The CalHFA Conventional program is a Yes. The MyHome Assistance Program
CalHFA fully amortized thirty (30)-year (MyHome) or School Teacher and
fixed interest rate first mortgage. Employee Assistance Program (School
Program) and Community Second
Who can originate CalHFA Conventional? subordinate loan programs may be
layered with CalHFA Conventional. In
To be eligible for this program lenders
the case of conflicting guidelines, the
must be approved by:
more restrictive will apply.
• CalHFA
What areas of California are eligible for
• Fannie Mae or have access to HFA CalHFA Conventional?
Preferred through a DO sponsorship
CalHFA is a state-wide program.
• Lakeview Loan Servicing (LLS), Properties located anywhere within the
CalHFA’s master servicer. To seek State of California may be eligible for
LLS approval contact the the the program.
Counterparty Risk Management
team at Are there sales price limits on CalHFA
CRM@Lakeviewloanservicing.com Conventional?
• Genworth Mortgage Insurance Yes. The sales price of the property
To seek a Genworth Master Policy, must be within CalHFA’s published
you may apply online sales price limits. These sales price
limits can be found on the CalHFA
My borrower(s) owns a rental property; website.
can they keep the property and still be
eligible for the CalHFA Conventional? What is the maximum loan amount for
CalHFA Conventional?
Yes, if they meet CalHFA’s first-time
homebuyer definition. The maximum total loan amount can-
not exceed Fannie Mae loan limits.
My borrower is not a first-time
homebuyer, how many years’ tax returns All loans with a loan amount exceeding
do I need to submit for the CalHFA $484,350 up to $726,525 will be sub-
Conventional? ject to an additional fee. See CalHFA
rate sheet for applicable fees.
One (1) year tax return is required for a
non-first-time homebuyer. All Fannie Mae High Balance Loan
fees will be net funded at the time of
Do I need to make a reservation in the first mortgage purchase by the master
Mortgage Access System (MAS) before servicer.
submitting a loan file to CalHFA?
Maximum LTV for Fannie Mae High
Yes. The CalHFA-approved lender must Balance Loan Limits: 95.00%
make a reservation in our MAS prior to
loan submission. (continued on next page)
2019 CALIFORNIA HOUSING FINANCE AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 13CALHFA CONVENTIONAL LOAN PROGRAM
FAQ’s (cont.)
Are condominiums eligible for CalHFA What are the minimum credit score
Conventional? requirements for CalHFA Conventional?
Yes. CalHFA’s minimum credit score is
640 except under the following
Is a manufactured home eligible for circumstance
CalHFA Conventional?
• Manufactured Homes: 660
Yes, manufactured homes are permit-
ted per Fannie Mae MH Advantage Does CalHFA use the lowest credit score
and Fannie Mae Standard MH with the to determine the minimum representative
following parameters: credit score for CalHFA Conventional?
• Minimum credit score: 660 No. The middle score of the lowest
scoring borrower is used to determine
• Singlewide manufactured homes are eligibility.
not eligible
• If a tri-merged credit report is used,
• Fannie Mae Desktop Underwriter ®
use the middle score
(DU®) with Approve/Eligible
Findings only • If a merged credit report only
returns two scores, use the lower
• Leaseholds are not permitted score
• Appraisal for MH Advantage • If a merged credit report only
requires picture of MH Advantage returns one score, that score must
Sticker be used
Fannie Mae MH Fannie Mae My borrower only has one credit score. Is
Advantage Standard MH that okay for CalHFA Conventional?
Max LTV/CLTV: Max LTV/CLTV:
97%/105% 95%/105% Yes, one credit score is acceptable with
Desktop Underwriter (DU )
® ® DU Approve/Eligible findings.
Use with Fannie Mae HFA PreferredTM only
Select Manufactured Home or Do all of my borrowers need to meet the
Select MH Advantage minimum credit score requirement for
Manufactured Home: Condo/
in the Subject
Property Type field
PUD/Co-op in the Subject CalHFA Conventional?
Property Type field
A minimum representative credit score
What automated underwriting engines do of 640 (or 660 for borrowers purchas-
you allow for CalHFA Conventional? ing a manufactured home) is required
for all borrowers who have a credit
CalHFA will only accept the most
score. When any co-borrower has no
recent version of Fannie Mae’s Desktop
credit score they may be eligible if they
Underwriter® (DU®) with the HFA
obtain Approve/Eligible findings.
Preferred™ option.
(continued on next page)
2019 CALIFORNIA HOUSING FINANCE AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 14CALHFA CONVENTIONAL LOAN PROGRAM
FAQ’s (cont.)
Can I use Non-Traditional credit for • $250 funding fee (payable to
CalHFA Conventional? CalHFA’s master servicer)
No, non-traditional credit is not eligible • $75 tax Service Fee (payable to
for the CalHFA Conventional. CalHFA’s master servicer)
Is manual underwriting permitted for • $10 Life of Loan Flood Certification
CalHFA Conventional? Fee (payable to CalHFA’s master
servicer)
No. Manual underwriting is not
permitted. • In all cases the lender must meet
federal and California lending laws
What is the maximum age of credit regarding fees and charges.
documents for CalHFA Conventional?
Does CalHFA Conventional require the
CalHFA will follow Fannie Mae borrower to be a first-time homebuyer?
guidelines for the age of the credit
documents. No. This program is open to
both first-time and non-first-time
What is the maximum LTV/CLTV for homebuyers.
CalHFA Conventional?
Does the Federal Recapture Tax apply to
The maximum LTV is 97.00%. The CalHFA Conventional?
maximum CLTV is 105%.
No. Federal Recapture Tax does not
Does the borrower have to have a apply to this program.
cash down payment for the CalHFA
Conventional? Is homebuyer education required for
CalHFA Conventional?
No, CalHFA does not require a mini-
mum borrower investment from the Homebuyer Education counseling is
borrower. Please follow Fannie Mae required for one occupying first-time
HOMEReadyTM and Genworth Mortgage homebuyer.
Insurance guidelines.
Homebuyer Education is not required
What fees and related charges are for non-first-time homebuyer(s).
allowed for CalHFA Conventional? • Online Homebuyer Education
CalHFA allows: through eHomeTM
• Customary lender origination fees • Face-to-Face Homebuyer Education
not to exceed the greater of 3% of through NeighborWorks America or
the loan amount or $3,000 through one of the HUD approved
Housing Counseling Agencies
• Other customary third-party fees
such as the credit report fee,
appraisal fee, insurance fee or
similar settlement or financing cost.
(continued on next page)
2019 CALIFORNIA HOUSING FINANCE AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 15CALHFA CONVENTIONAL LOAN PROGRAM
FAQ’s (cont.)
Is a temporary buydown available for When will I be able to lock my interest
CalHFA Conventional? rate for CalHFA Conventional?
2-1 temporary buydowns are permitted CalHFA Conventional has two locking
options. The rate can be locked at
• Follow the master servicer reservation or at any time during the
guidelines reservation period if the float-to-lock
• The borrower must be qualified option is chosen. All lenders must have
based on the note rate, consider- full MAS access to lock the interest
ing the borrower’s current obliga- rate.
tions and other mortgage-related
obligations I have chosen the float option for
CalHFA Conventional, and my loan has
Will co-signers be allowed for CalHFA already been conditionally approved by
Conventional? CalHFA, but the rate has increased since
approval. Do I need to have my loan
No, non-occupant co-signers are not re-underwritten?
permitted.
Yes. Lenders may not lock a loan in
Will non-occupying co-borrowers be MAS with an interest rate that is higher
allowed for CalHFA Conventional? than the interest rate reflected on the
CalHFA Notice of Commitment.
No. Non-occupying co-borrowers are
not permitted. What is the rate lock period for the
CalHFA Conventional?
Is there a re-lock fee for the CalHFA
Conventional? Lenders may lock the interest rate
for sixty (60) days for both existing/
There is no re-lock fee. If the rate lock resale properties and new construction
expires or the loan is cancelled, it can properties.
only be re-reserved and locked after a
sixty (60) day waiting period, subject to I cannot close my loan in time. Can I get
guidelines in effect at that time. a rate lock extension?
All rate lock extensions must be
I had to cancel a CalHFA Conventional requested through CalHFA’s Secondary
reservation after the Notice of
Marketing Unit via email prior to the
Commitment was issued. The sixty (60)
expiration of the current rate lock.
days has now passed and I have re-
reserved the loan. Do I need to submit a Rate lock extension fees are posted on
new file to CalHFA? the Rates & Reservation page of the
CalHFA website.
Yes. The lender must submit a new file
to CalHFA with current documentation.
Every file that has a new reservation
number must have its own file and go
through the approval process.
(continued on next page)
2019 CALIFORNIA HOUSING FINANCE AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 16CALHFA CONVENTIONAL LOAN PROGRAM
FAQ’s (cont.)
Can my borrower pay for the cost of the to the rate lock expiration date. CalHFA
CalHFA Conventional rate lock extension? suggests loan delivery by the 45th day
for sixty (60) day rate locks or the 75th
Yes. The borrower(s) or seller(s) may be
day for ninety (90) day rate locks, or
charged with the cost of the extension
earlier to ensure time to clear condi-
fee for the first mortgage, however you
tions and purchase prior to expiration
must follow TRID fee requirements.
date.
At the time of purchase by CalHFA’s
master servicer, the rate lock extension How often does the master servicer
fee(s) are to be net funded from the purchase for CalHFA Conventional?
lender’s proceeds. Late fees on subor-
dinate loans may not be charged to the The master servicer will purchase
borrower(s) and will be net funded at approved loans on a daily basis.
the time of purchase by CalHFA.
Sales Tools And Marketing Materials
What if the borrower changes properties?
Can I cancel the existing reservation and 1. Conventional Program Matrix
re-reserve the CalHFA Conventional?
2. Scenario Calculator
Yes, reservations are borrower, property
and lender specific. If the borrower 3. Loan Submission, Review
changes properties, the existing reser- and Purchase Flow Chart for
vation must be cancelled before a new Conventional
reservation is made. The underwriting
and program guidelines in effect at the 4. Lending Heroes Flyer
time of the re-reservation will apply.
5. Lending Heroes Fillable Flyer
My borrower had a loan reservation with
another lender, but now they want to go 6. Lending Heroes Spanish Flyer
through me. Can I reserve the CalHFA
Conventional? 7. Lending Heroes Spanish Fillable
Flyer
If the rate was not locked on the other
lender’s reservation, the new lender 8. Lending Heroes Korean Flyer
may reserve the loan once the previ-
ous reservation is cancelled by the 9. 5 Easy Steps to Buying Your
original lender. If the rate was locked First Home Flyer
by CalHFA, the new lender may reserve
the loan after the sixty (60) day wait 10. 5 Easy Steps to Buying Your
period from the original rate lock First Home Spanish Flyer
expiration.
11. CalHFA and Listing Agents: a
Does the CalHFA Conventional need to Great Team! Flyer
be delivered to the master servicer by
the rate expiration date? 12. 5 Tips for CalHFA Doc Draw and
Closing Flyer
No. The loan must be delivered and
purchased by the master servicer prior
2019 CALIFORNIA HOUSING FINANCE AGENCY www.calhfa.ca.gov | 877.9.CalHFA (877.922.5432) 17You can also read
