1. Home Ownership Today (HOT)
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Home Ownership Today (HOT)
June 13, 2019
06/03/2019
Training for Mortgage Professionals

2. GSFA as a Public Entity & Agency
Supporting Affordable Homeownership for 26+ Years
Mission to Provide a Source of Financing for California Homebuyers
Standard mortgage products
Provide down payment assistance (DPA) or other enhancements
Approve and utilize vast network of Lenders to originate programs
Standard Underwriting
Ensure responsible lending + Borrower ability to pay
Any overlays are more restrictive, not less
Standard Mortgage Products
DPA, MCC, Other Incentives
Increased Affordability
75,500 homebuyers helped
$542.3 million in down payment assistance provided
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3. Common Down Payment Assistance MYTHS
Only in certain areas
Only for first-time homebuyers
Only for low-income borrowers
Only for those with zero savings
Only for exceptional credit
Accrues interest
Only works with FHA
Harder to qualify
Takes longer to close
Limited funding
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* According to findings from the second annual America at Home survey commissioned by NeighborWorks America."

4. GSFA HOT - What is it? First Mortgage Loan
combined with
Down Payment Assistance Options
Introductory notes.
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5. Accessible and Flexible
GSFA HOT
Accessible and Flexible
Up to 7.0% in for Down Payment and/or Closing Costs
FICOs as Low as 640
NO First-time Homebuyer Requirement
NO Federal Recapture (NOT a Bond Loan)
NO Pre-close Compliance Review
Program Available throughout California
Funding for Assistance Provided by GSFA
On-going Funding Source
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6. DPA – Structure and Terms
GSFA HOT
DPA – Structure and Terms
DPA Amount and Options
3.5% Deferred Second Mortgage
7 Additional Gift/Grant Options:
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
GSFA Affordable Subsidy (AIS):
$1,500 < 80% AMI
$2,500 for < 50% AMI
DPA Based on First Loan Amount
3.5% Deferred Second:
30 Year Term
Note Rate of 0%
No interest accrual
Non-amortizing; no monthly payments
Due and payable upon sale, refinance or maturity of the First Mortgage
No subordination allowed
Use of DPA Funds
Down Payment and/or Closing Costs
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7. Interest Rates & Lock Process
GSFA HOT
Interest Rates & Lock Process
Lock Period = 30 days
Locks are available for up to 30 days. There is no cost reduction for shorter lock periods.
Lock Process:
MWF will accept lock requests for HOT programs from 8:30 AM to 4:30 PM PT.
Affordable subsidy: Locks will verify income eligibility and add a condition if it appears the borrower(s) qualify for the additional GSFA Affordable Subsidy.
See Retail Capital Markets Policy for complete Locks requirements.
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8. GSFA HOT Conventional Options
EXAMPLE
30-year fixed-rate GSFA HOT mortgages.
Purchase Price $300,000.
Various DPA Options.
1 For example purposes only; Interest Rate published 06/11/19, subject to change.
2 MI based on FICO of 720 with Charter level coverage on 2 borrowers through MGIC. (0.48%)
Category
GSFA HOT
Freddie Mac HFA Advantage
97% LTV (3.5% DPA)1
97% LTV (5.0% DPA)1
97% LTV (7.0% DPA)1
First Loan Interest Rate
4.500%
5.000%
5.875%
Purchase Price
$300,000
Down Payment Required
3.00% ($9,000)
Total First Loan
$291,000
Second Mortgage DPA
$10,185
Gift DPA $0
$4,365
Total HOT DPA
$14,550
$20,370
Monthly P & I (First Loan)
$1,474
$1,562
$1,721
Monthly MI2
$116
Monthly P & I (DPA)
Total Monthly Payment
$1,591
$1,679
$1,838
Borrower Out-of-Pocket for Down Payment
Remaining DPA for Closing Costs
$1,185
$5,550
$11,370
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9. Property Types Eligible Properties Properties NOT Allowed
GSFA HOT
Property Types
Eligible Properties
Owner occupied, Single-Family Residences only
1-unit only
Agency approved condominiums
Planned Unit Developments (PUDs)
Properties NOT Allowed
No Manufactured homes
NO co-ops
NO investment properties
NO recreational, vacation, nor second homes
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10. FICO / DTI / Underwriting
GSFA HOT
FICO / DTI / Underwriting
Freddie Mac HFA Advantage Conventional Loan:
Minimum FICO = 640
Each borrower must have a credit score
Maximum DTI = 45%
LPA Approval
DU not allowed
No manual underwriting
Follow Freddie Mac Guidelines for Standard Underwriting
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11. Program Limits and Homebuyer Education
GSFA HOT
Program Limits and Homebuyer Education
Loan Limit: $484,350
Income Limit Based on:
Credit qualifying income
County of property
Follow GSFA Income Limits shown on the MWF Matrix/Overview
Homebuyer Education/ Counseling
Required for one borrower if all borrowers are first time homebuyers.
HBE course must be completed prior to closing.
See CreditSmart Homebuyer Education.
Income Limits for Top Counties
Los Angeles $79,695
Orange $79,695
Riverside $75,670
Sacramento $92,115
San Bernardino $75,670
San Diego $94,070
Santa Cruz $93,610
A schedule design for optional periods of time/objectives.
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12. Income Limits by County
Alameda
$120,060
Marin
San Mateo
Alpine
$89,470
Mariposa
$73,830
Santa Barbara
$91,540
Amador
$84,640
Mendocino
$69,690
Santa Clara
$143,980
Butte
$69,575
Merced
$55,430
Santa Cruz
$93,610
Calaveras
$83,145
Modoc
$68,655
Shasta
$70,610
Colusa
Mono
$89,125
Sierra
$75,670
Contra Costa
Monterey
$79,465
Siskiyou
Del Norte
Napa
$78,775
Solano
$96,255
El Dorado
$92,115
Nevada
$80,500
Sonoma
$96,715
Fresno
$63,825
Orange
$79,695
Stanislaus
$69,805
Glenn
Placer
Sutter
$69,000
Humboldt
Plumas
$72,795
Tehama
Imperial
Riverside
Trinity
Inyo
$81,765
Sacramento
Tulare
$56,580
Kern
$67,505
San Benito
Tuolumne
$72,680
Kings
$63,710
San Bernardino
Ventura
$110,400
Lake
San Diego
$94,070
Yolo
Lassen
$78,200
San Francisco
Los Angeles
San Joaquin
$73,255
Madera
$63,480
San Luis Obispo
$92,690
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13. Mortgage Insurance Advantages
GSFA HOT
Mortgage Insurance Advantages
Freddie Mac HFA Advantage
Charter Level Coverage
No Upfront MIP
Monthly BPMI is Cancelable
No Loan Level Price Adjustments (LLPAs)
LTV
Standard Coverage
Charter Coverage
95.01 – 97.00%
35%
18%
90.01 – 95.00%
30%
16%
85.01 – 90.00%
25%
12%
80.01 – 85.00% 6%
A list of procedures and steps, or a lecture slide with media.
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14. Origination Guidelines
GSFA HOT
Origination Guidelines
Origination Fee:
Up to 2.0% Borrower Paid Origination
Retail: 1.50% to Branch and 0.50% to Corporate
Wholesale: 1.50% paid to broker and 0.50% paid to Mountain West Financial, Inc.
Discount Points NOT Allowed
Closing Costs (customary/reasonable) Allowed:
Including appraisal, credit reporting, survey, title insurance
Must be charged in accordance with loan agency policies
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15. GSFA Affordable Subsidy
Additional Assistance for Low Income Borrowers
GSFA Affordable Subsidy
Subsidy Size:
Income ≤ 50% AMI = $2,500
Income ≤ 80% AMI = $1,500
For Down Payment and/or Closing Costs
Gift / No Repayment Required
Income Limits
Specific to the Subsidy
Published in Term Sheet
Relative vocabulary list.
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16. Underwrite, Approve, Close and Fund Transaction
GSFA HOT
Loan Process
Lender processes/closes Loan as usual
NO Additional Compliance Review from GSFA
DPA designation on CD:
“GSFA Second Mortgage” or “GSFA Gift” (as applicable)
MWF upfronts DPA at closing on behalf of GSFA
Underwrite, Approve, Close and Fund Transaction
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17. Review of Program Advantages
GSFA HOT
Review of Program Advantages
HOMEBUYERS
Financial Assistance:
DPA up to 7.0%
Flexibility:
Don’t have to be a first-time homebuyer
FICO scores as low as 640
Variety of assistance options
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18. Remember these Common MYTHS regarding DPA?
GSFA HOT
Remember these Common MYTHS regarding DPA?
Do these apply to GSFA HOT? No
Only in certain areas
Only for first-time homebuyers
Only for low income borrowers
Only for those with zero savings
Only for exceptional credit
Accrues interest
Only works with FHA
Harder to qualify
Takes longer to close
Limited funding
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19. This concludes today’s training event. Thank you all for attending.
TOGETHER WE CAN MAKE A DIFFERENCE
Copyright© 2019 Golden State Finance Authority (GSFA). All rights reserved.
Presentation contains program highlights only. All guidelines are subject to change without notice. Visit for complete program guidelines. GSFA HOT is sponsored by GSFA, a duly constituted public entity and agency, and managed by National Homebuyers Fund, Inc., a non-profit public benefit corporation and Instrumentality of Government under Internal Revenue Service code section 115.
GSFA Administration Office
1215 K Street, Suite 1650
Sacramento, CA 95814
06/03/2019
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