1. Essex Mortgage Brings CALHFA PRODUCTS to you!

2. How do you know what program you want?
Do you want to work with an FHA or Conventional loan? Do you want a 1st, 2nd, and 3rd or just a 1st and 2nd? Is your borrower a FTHB; they must be!
You have several product options, but they all surround these basic descriptions!
CalHFA 1st (Conventional or FHA) can be combined with:
My Home Assistance 2nd; or
School Program 2nd.
Cal “Plus” 1st (Conventional or FHA) can be combined with:
My Home Assistant 2nd
School Program 2nd
My Home Assistant 2nd and a ZIP 3rd
School Program 2nd and a ZIP 3rd
NOTE: My Home and School Program can only be used for down payment and/or closing cost assistance. This is not to be used to pay the difference in sales price and appraised value if the sale price is higher. It also can not be used for paying off borrower debt. ZIP can only be used to pay for closing costs and/or prepaid items only.

3. Compare: My Home Assistance – ZIP – SCHOOL FHA or Conventional)
MY HOME ASSISTANCE – 2nd only
ZIP – Can be a 2nd or a 3rd
School Program – can only be a 2nd
Can only be used as a 2nd with a CalHFA 1st or CalPlus 1st –
Can be used as 2nd or 3rd with a CalPLUS 1st only. (Must be in third position if used with My Home Assistance
Can be used with a CalHFA as 2nd (not with My Home), or Cal Plus as 2nd and add a ZIP 3RD
2 ½% Simple Interest Rate compounded annually; deferred payments.
Due when 1st is paid in full, refinanced, or assumed. No forgiveness of debt.
0% Interest Rate/payments
Due when property is transferred or 1st loan is refinanced, or paid in full.
No forgiveness of debt.
Deferred payment simple interest rate
Loan amount: 3 1/2 % of Sales Price or appraised value, whichever is less
Loan amount can be 3% or 4% of 1st loan amount (including MIP)
Loan amount not to exceed 4% of lesser of s/p or a/v/
Must be a FTHB
Home education required
Home Education required
1 Year HOW Warranty required to cover water heater(s), air conditioning and heating – if placed with an FHA you must also include oven/stove/range
1 Year HOW Warranty required only if a FTHB. Must cover water heater(s), air conditioning, heating and if with an FHA, must include oven stove and range.

4. Comparing Programs CalHFA Con 1st CalHFA FHa CalPlus Con 1st
Can not use a ZIP
CalHFA FHa
CalPlus Con 1st
CalPlus FHA 1st
MHA
2nd Only
ZIP
2nd or 3rd
SCHOOL Program
Conforming $453,100 or max for county + MIP
97/105CLTV
High balance to $636,150 (subject to an additional fee; see rate sheet);
Max LTV for HB Conventional 95%/105 CLTV
Conforming
$453,100 or max for county + MIP
High balance to $636,150 (subject to an additional fee; see rate sheet)
High balance to $636,150 (subject to an additional fee; see rate sheet) Max LTV for HB Conventional 95/105% CLTV
Rate: 2 ½%; deferred payment, simple interest rate
Loan Amount:
3 ½% S/P OR A/V, whichever is less
CAN BE USED FOR DP/CC/ AND PREPAIDS
Rate: 0% deferred interest rate
Choice of 3% or 4% of 1st loan amount;
ZIP CAN ONLY BE USED TO PAY C/C AND OR PREPAIDS
Rate:
2 ½% deferred payment, simple interest
4% of the S/P or A/V, whichever is less
Employee currently employed in any K-12 CA public school, including public charter schools, school district officer and county/continuation schools

5. Comparing Programs (cont.)
CalHFA Con 1st
CalHFA FHA 1st
Cal Plus Con 1st
Cal Plus FHA 1st
MHA 2ND only
ZIP 2nd or 3rd
2nd only :
School Program
640 Minimum FICO
No manual underwrite
660 FICO if manual underwrite
Depending on 1st TD
SFR, Condos and PUD’s
Same
N/O co borrower are not allowed
Borrower affiliation required
n/a
One employee currently employed in any K-12 CA public school, including public charter schools, school district officer and county/continuation schools

6. Comparing Programs cont.
CalHFA Con
CalHFA FHA
CalPlus Con
CalPlus FHA
MHA 2nd only
ZIP (2nd or 3rd)
SCHOOL PROGRAM
(2nd only)
Home Education required for 1 occupant
Same
same
Co Signers are NOT allowed
Co Signers ARE allowed – income not counted in limitations
Same as 1st TD
Same as 1st TD
Not subject to recapture tax
3 Years Tax Return
3 Years Tax Returns
45% Max DTI
43% if Manual underwrite

7. Comparing Programs (cont)
CalHFA Con
CalHFA FHA
CalPlus Con
Cal Plus FHA
MHA 2ND
ZIP (2nd or 3nd)
School Program
MI – Genworth
18% on 97% LTV16% on 95%
FHA MIP
MI 18% on 97% LTV16% on 95% LTV Genworth
n/a
Home Warranty must include water heater(s), air conditioning and heating
Home Warranty same as Conventional, but FHA also required oven stove and range

8. Fees and Lock Periods FEES FOR THE PROGRAM LOCK PERIODS
BORROWER PAID ONLY
Broker Compensation 2.375% or $3000 whichever is more (must pass 3% points and fees test)
1st TD: $1350 Essex Admin Fee
2nd TD: If using My Home Assistance or Extra Credit Teacher : $250 Essex Processing Fee (you can’t use together)
2nd TD: If using ZIP for a 2nd or 3rd: $11.95 MERS Fee
Home Warranty fee
Third Party Contractors allowed if within the 3% points and fees test.
LOCK WHEN ALL PTD’S ARE CLEAR
Lock Period is for 30 days
CalHFA turn times can be found at:
How much of your production with Essex can be CalHFA products? 50%
Option for unlimited CalHFA’s:
origination fee + $ $250 Ask your AE how this can be done.
8/24/20168/24/2016

9. Refer to CalHFA Loan limitations for FHA and Convention
Income Limits - regardless of household size (effective ) & Sales Price Limits
$660,000 Statewide
Refer to CalHFA Loan limitations for FHA and Convention

10. Income Calculations - Differences
Lender –Qualifying Income
CalHFA – Eligibility In come
Same standard calculations per guidelines
Average 2 years Plus YTD
Exclude variable income that does not have a 2 year history
Exclude child support that has less than 3 years continuance
Gross up the non-taxable income
Include all borrower’s income
Average last year and YTD – max 24 months
Include variable income, even if no history
Include child support even if it does not continue
Do not gross up non-taxable income

11. INCOME COUNTED WWW. http://www. calhfa. ca

12. Sample Loan Scenario http://www.calhfa.ca.gov/calc/scenario.html

13. Property
Guest Houses (granny units) are eligible; zoned for SFR/must meet city/county zoning Cannot be zoned for 2-4
No income producing; personal use only
No Manufactured housing (Essex requirement)
No Leasehold
Non permitted additions/alterations per FNMA or FHA guidelines
Lot size – max 5 acres

14. First Time Homebuyers and Education Requirements Required: Always required on My Home, MCC and if using ZIP and borrower is a FTHB
First Time Homebuyer (FTHB)
Home Education
For CalHFA purposes, a FTHB is defined as a borrower who has not had any ownership interest in any principal residence during the previous 3 years.
If currently owns a non owner residence, 3 years of cancelled checks would have to be provided to show paying rent elsewhere; living with parents would not suffice. This would only be require if DU calls for a VOR. If no VOR is called for, then no cancelled checks would be required.
Home Education is required for “one” occupying first-time homebuyer

15. How to Submit 1st TD 2nd TD 3rd TD (if there is a 3rd)
Broker to use additional Addendum Submission Sheet for CalHFA in addition to regular Submission Sheet.
Choose the Option Plan.
Broker to register and create a loan number for each loan submitted
Broker to register and create a loan number
Essex will disclose
Submit submission sheet & addendum, fees worksheet, wet signed 4506T, and complete credit package
1003 for the 2nd (3.2)
1003 for the 3rd (3.2)
Additional Forms for the program: CALHFA Borrower Affidavit
and Tax Affidavit if applicable (forms on Essex website)
N/A
3 years 1040’s

16. CALHFA Addendum Submission Sheet http://www. essexwholesale

17. CalHFA Borrower Affidavit Found on web site under CalHFA PRoduct

18. How to run DU Conventional

19. How to run DU FHA Note: The rates and % of loan has changed from this SAMPLE See daily rate sheet for most current rates – below are sample rates and %’s ONLY. Call your AE if you have any questions.

20. Additional CALHFA Forms at submission:
CalHFA Addendum Submission Sheet
CALHFA Borrower Affidavit (2/18)
Tax Return Affidavit (only required if not required to file 1040’s)
These forms can be found at
Click on Products – CALFHA
Home Buyer Education: (required for one occupying 1st time buyer – not required for non-1st time homebuyers if using ZIP only – it is required for all My Home Assistance products)
On line:

21. Repayment
Repayment of the principal and interest on the subordinate loan shall be due and payable at the earliest of the following events:
• Transfer of title
• Sale of the property*
• Payoff of the first loan
• Refinance of the first loan, unless the CalHFA junior lien is subordinated
• The formal filing and recording of a Notice of Default (unless rescinded)
Payoff or refinance of the unless the ZIP is resubordinated.
*My Home and the School Program loans behind an FHA first mortgage may be assumed or paid off when the first mortgage is assumed

22. Conventional Mortgage Insurance