Department of Veterans AffairsPuerto Rico Lender Training

ST Petersburg Regional Loan CenterST Petersburg Regional Loan Center888-611-5916888-611-5916

PRESENTED BY REGIONAL LOAN CENTERST. PETERSBURG, FLORIDA

Sharon Glanton-Davis, LPOMonica Collins, ALPOSteven Roberts, ALPO

Objective

To provide program participants a To provide program participants a better understanding of how to better understanding of how to process and underwrite VA Loans. process and underwrite VA Loans.

ANDAND

How to navigate the VA Portal and How to navigate the VA Portal and utilize its resources to make the VA utilize its resources to make the VA Home loan process easier.Home loan process easier.

VA Regional Loan Center QUESTIONS CONTACT THE VA QUESTIONS CONTACT THE VA

Go to Go to WWW.BENEFITS.VA.GOVWWW.BENEFITS.VA.GOV/HOMELOANS//HOMELOANS/

Lender’s HandbookLender’s Handbook

CALL 1-888-611-5916, or email CALL 1-888-611-5916, or email fl/homeloan@vba.va.govfl/homeloan@vba.va.gov

The Lender’s Handbook is referenced The Lender’s Handbook is referenced throughout this presentationthroughout this presentation

Refer to Websites information on handoutsRefer to Websites information on handouts

Where we are Today Find A Home

Go to a lender

Close 14-21 DaysClose 14-21 Days

Register in the VA Portal

Go to Go to WWW.BENEFITS.VA.GOV/HOMELOANS/WWW.BENEFITS.VA.GOV/HOMELOANS/

Access VA Portal and Register Access VA Portal and Register Must have a VA Lender IDMust have a VA Lender ID See handout for registration See handout for registration

processprocess

WHY A VA LOAN?

No Down Payment for loans less than $417,000

No Mortgage Insurance Premium

Limitation on Buyer’s Closing Cost

No prepayment penalty

Servicing is available through the VA to avoid foreclosures. Check Portal for VALERI updates. Borrowers should contact lender first.

Obtain A Certificate of Eligibility

Complete VA Form 26-1880

Access WEBLGY to get electronic COE (through the VA Portal) at WWW.BENEFITS.VA.GOV/HOMELOANS/, or WWW.VIP.VBA.VA.GOV

Upload supporting documents , Forms 26-1880, DD214 (member 4) and Statement of Service. Satisfaction of Mortgages, Recorded Deeds and HUD 1 will support restorations of entitlement

Mail the Certificate of Eligibility application to:Atlanta Regional Loan Center Attn: COE (262)PO BOX 100034Decatur, GA 30031 Toll Free 888-768-2132 EMAIL:HTTPS//IRIS.VA.GOV

ACE-Automated COE

Access Internet based application through Access Internet based application through the VA Portal the VA Portal WWW.VIP.VBA.VA.GOVWWW.VIP.VBA.VA.GOV

See See ApplicationsApplications select select WEBLGYWEBLGY,, proceed proceed to to EligibilityEligibility, and , and Create a RecordCreate a Record. Input . Input information according to military service information according to military service records data, i.e. Form DD214 . To avoid records data, i.e. Form DD214 . To avoid electronic errors, documents must be electronic errors, documents must be uploaded into (WEBLGY). See pg 15 uploaded into (WEBLGY). See pg 15 handout handout

Maximum guaranty amount is now Maximum guaranty amount is now

$104,250 or 25% of conforming loan limit $104,250 or 25% of conforming loan limit for purchase up to $417,000 for purchase up to $417,000

See Handout Pgs 15-21

Surviving Spouse COE If applying for the If applying for the first time first time submit submit

form 26-1817 to:form 26-1817 to: Atlanta Regional Loan Center Attn: COE (262) PO BOX 100034 Decatur, GA 30031 Only Only paper applications paper applications accepted by accepted by

mail. This process may be lengthy. mail. This process may be lengthy. Please submit immediately. Please submit immediately.

Chapter 2.3, M26-7

Restoration of Entitlement

When entitlement is used, it must be restored to obtain a When entitlement is used, it must be restored to obtain a 25% guaranty.25% guaranty.

Complete VA Form 26-1880 and provide proof of service Complete VA Form 26-1880 and provide proof of service (upload all documents into WEBLGY(upload all documents into WEBLGY)

AND

Provide proof of loan payoff and disposal of property, ie;Provide proof of loan payoff and disposal of property, ie; HUD 1HUD 1 Recorded Satisfaction of Mortgage Recorded Satisfaction of Mortgage Recorded copy of DeedRecorded copy of Deed Release of Deed of Trust (Cancellation)Release of Deed of Trust (Cancellation)

Chapter 2-3, Chapter 2-3, M26-7M26-7

Formula for Entitlement

Basic Entitlement

A Veteran’s basic entitlement is $36,000

Loans greater than $144,000 the Maximum Guaranty amount is 25% of the loan amount, up to $104,250

See Handout Pg 33

Bonus Entitlement

Loan amount $417,000 X .25%= 104,250

Max Entitlement 104,250-36000= 68,250

Bonus Entitlement 68,250 X 4= $ 273,000New Loan Amount $273,000

Verification of Benefits The Veteran’s Exempt StatusExempt Status is now verified on

the Certificate of Eligibility. Please refer to circular 26-11-11. See Handout

Since FF status is shown on the COE, lenderslenders in most cases will no longer be required to faxwill no longer be required to fax VA Form 26-8937 to VA for processing.

Do not send the form if the veteran does not indicate they receive service-connected disability benefits from VA. Circular 26-11-11

See Handout Pgs 21-23-24

ORIGINATION PROCESS

Once you determine the borrower is an eligible Veteran and have obtained a COE/ACE, begin the application process.Please Obtain COE/ACE and Verification of Benefits early-not the day of closing.

Eligible Loan Purposes Purchase or construct a home Refinance IRRRL (streamline or rollover) Cash-Out Refinance-(up to 100% existing property value, must occupy) Install Energy-related features

True or false- A vet may use their benefit to purchase land only?

Chapter 3 Pgs. 3-5 Chapters 6-7

Loan Processing COE/ACE IS OBTAINED PROCEED TO:

Complete all required forms (CH 5) Verify credit is satisfactory (CH 4) Obtain appraisal & Notice of Value NOV (CH

13) Obtain VOE’S and AUS-if used (CH 4) Asset verification if needed (CH 4) Obtain Veteran’s (if exempt) Status (COE) Seller Concessions and allowable closing fees

(CH 8) See Handout Calculate funding fee (CH 8) (Circular26-11-15

) Close the loan

VA Required Documentation

CAIVRS AUS (Automated

underwriting Print out, Data Integrity).

Debts and obligations (Credit reports)

NOV Notice of Value/Appraisal

Loan Application URLA

Verified, available income, 2 years minimum

Occupancy Assets Adverse Data (Credit) Form 26-6393 Loan

Analysis Chapter 4,

M26-7

Occupancy RequirementOccupancy Requirement The veteran borrower must intend to occupy the

home as his/her primary residence

This must be indicated on VA Form 26-1820 at closing

The spouse is the “only” other person that can satisfy the occupancy requirement

Chapter 3, M26-7

Debts and Obligations Significant Debts must be deducted from

effective income to determine repayment ability. Form 26-6393

1 full month of paystubs may reveal additional unreported debts such as alimony, garnishment, etc.

Analyzing Credit, Adverse data, supporting documents are required

Chapter 4, M26-7

APPRAISALS

Order appraisals through VA Portal at Order appraisals through VA Portal at HTTP://WWW.VIP/VBA/VA/GOV/PORTAL/HTTP://WWW.VIP/VBA/VA/GOV/PORTAL/

Select Select Webgly, Go into Loan- Request

appraisal. Select Lapp for Automatic Lenders or IND if Prior approval. Indicate LGI if liquidation appraisals and Submit.

Complete applicationComplete application with correct information with correct information and submit. The system will generate a VA and submit. The system will generate a VA request for determination of reasonable value request for determination of reasonable value (form 26-1805(form 26-1805) ) See Handout See Handout

Chapter 12-13, M26-7

Appraisal Requirements Sales contract , must

provide a complete copy to appraiser, failure to provide will hold assignment.

Title Study and Legal Description, lender must provide complete complete legallegal on the 1805

Burglar Bars – VA no longer offering waivers.

Release on at least one window per room or rapid egress

Wood destroying Insect info not required unless part of the property constructed of Wood

See C & V Manual

REFINANCING

Refer to chapter 6 Check occupancy rulesVerify active VA LoanCash Out–up to 100% value, credit, appraisal and occupancy required.IRRRL- No credit, No Appraisal required.

Chapter 6 M26-7

Submitting Loan Package WEBLGY is

programmed to mark every 10th case for full review/audit as required in MP26-1

Provide full package to the RLC when WEBLGY shows “YES” in the top right corner (shows once the loan has been guaranteed)

If submitting package to VA for LGC (Loan Guaranty Certificate), provide documents required per Modified Submission Packages

IRRRL or Cash Out Refinance-refer to Chapter 6 and provide required documents

Chapter 5, M26-7 Pgs 1-23

Submitting loan package

Cash out refinance loans must have entitlement restored prior to obtaining LGC for the new loan. Only VA has the authority and ability to restore entitlement.

Entitlement needs to be restored in order to obtain 25% guaranty.

Chapter 5 M26-7

Pgs. 1-23

Allowable Fees and Charges

Pay VA Funding Fee (unless exempt). Circular 26-11-15

1% flat charge from lender

See Chart, Handout pg. 35

Chapter 8 M26-7 See Handout Pgs.

27-30

VA Funding Fee The basic funding fee for a first-time user is 1.40% of the The basic funding fee for a first-time user is 1.40% of the

loanloan amount as of November 18, 2011 (See Circular 26-11-15 for changes)

The funding fee for Reserves/Guard is 1.65%The funding fee for Reserves/Guard is 1.65%

(Effective November 18, 2011)(Effective November 18, 2011)

For subsequent use, except for IRRRLS the funding fee is For subsequent use, except for IRRRLS the funding fee is 2.8%2.8%

The funding fee for an IRRRL or an assumption is .50% The funding fee for an IRRRL or an assumption is .50%

See Circular 26-11-15 Handout Pgs. 28-30

Funding Fee System

The funding fee is paid electronically by the The funding fee is paid electronically by the lender within 15 days of closing. FFPS requires a lender within 15 days of closing. FFPS requires a password to access. FFPS can be accessed at password to access. FFPS can be accessed at https://va.pay.gov.https://va.pay.gov.

The lender must obtain a Vendor ID number. Call The lender must obtain a Vendor ID number. Call Funding Fee Helpline at 1-800-624-1373, or email Funding Fee Helpline at 1-800-624-1373, or email pay.gov.clev@clev.frb.org pay.gov.clev@clev.frb.org

All VA loans, including exempt cases must show a All VA loans, including exempt cases must show a funding fee record in order to obtain a Guarantyfunding fee record in order to obtain a Guaranty.

See Handout Pg. 31

To Issue Automatic Guaranty LGC

A Loan Guaranty Certificate ( LGC) is obtained by automatic lenders thru the WEBLGY System.

Log into VA Portal VA Portal www.benefits.va.gov/homeloans/. Select Weblgy. Go into Loan, enter New Loan, select the Automatic option and submit all information required as per loan closing documents.

All data must coincide with Certificate of Eligibility, Property information and funding fee system. Next submit. Loan Guaranty Certificate will be generated in seconds.

See Handout Pg. 32

LENDER MAINTENANCE Lenders and agents

must be approved by VA

Mergers and acquisitions are submitted to VA Central Office

Payment of fees is to defray costs

Yearly corporate company financial statements are required

Online training required for underwriters

Information, forms may be obtained on VA website www.benefits.va.gov/homeloans/

See Handout Pgs. 36-43 Chapter 1 M26-7

Supervised lenders require VA approval. However they are supervised by entities other than VA. Examples are Banks and Credit Unions.

VA Agents require a VA Lender ID number. Agents must be approved by a sponsor with Supervised or Non Supervised Automatic Authority. For Applications call 1-888-611-5916

VA LENDERS

o Prior Approval lenders also require a VA Lender ID Number. All packages must be submitted to VA for processing prior to closing the loan.

o Chapter 1, Lenders Handbook

Notary Fees Puerto Rico

Refer to Serial letter 317-26-1 issued July 17, 2010.

Puerto Rico Notarial Act Law 43 of July 23, 2009. Letter sets the maximum Abogado-Notary fees payable by veterans at closing of home purchases in Puerto Rico, Vieques and Culebra.

See handout or call 1-888-611-5916.

Thank You QuestionsDiscussion