single family programs - arkansas€¦ · adfa pays initial & final inspection ($125 + 42¢ /...
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SINGLE FAMILY PROGRAMS ARKANSAS DEVELOPMENT FINANCE AUTHORITY
MASTER SERVICER: ServiSolutions
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ADFA.ARKANSAS.GOV » FORMS » SINGLE FAMILY
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WHO IS ADFA?
1985 Established State Agency
ENABLING
LEGISLATION
Authorize to borrow money
and issue bonds for Affordable
Housing,
various business & economic
development projects, and
capital improvements for state
agencies.
NO State General Revenue
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WHO IS ADFA?
BONDS
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CURRENTLY UNDER
SINGLE FAMILY
DIVISION ADFA DOES
NOT ISSUE BONDS
ADFA PROGRAMS
ADDI
MOVE-UP DPA
MCC
or
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AIS
GRANT* * Conventional only.
MOVE-UP ADFA FIRST MORTGAGE PROGRAM FEATURES
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MOVE-UP PROGRAM GENERAL GUIDELINES
First Lien - 30 Year Fixed Mortgage Program:
VA, RD, FHA, or HFA Conventional 95% or 97%
- Conforming Loan Limits ($424,100)
- Non Occupant Co-Borrowers Allowed with FHA only
Reservations made from 9:00am to 7:00pm; Working business days only
Rate is set daily and sent to all participating lenders
Follow Product Guidelines from each program: Looking for ACCEPT Recommendation, on LPA; and APPROVE/ELIGIBLE, on DU. 7
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MOVE-UP PROGRAM GENERAL GUIDELINES
No 1st Time Homebuyer Requirement: Primary Residence only
No Income Limits; except when matched with MCC or ADDI
Affordable Income Subsidy Grant (AIS) available, must qualify!
Stackable with DPA and MCC.
Manufactured Housing allowed for government-backed loans only
NEW Reduced Loan Funding Fee ($200) & Reduced Tax Servicing Fee ($71.50) BOTH: netted at purchase by Master Servicer.
SRP = 1.75% ; VA= 1.25%; Origination Fee (optional)= 1.00%
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MOVE-UP PROGRAM GENERAL GUIDELINES
MOVE-UP, FIRST MORTGAGE
FHA VA RD HFA ADVANTAGE
CONVENTIONAL
Credit Score 660 640
Max DTI 45%
Underwriting DU or GUS LPA only
** No Manual Underwriting permitted**
Benefits Purchase Price Limit
ADDI has Income Limits
No Income Limits for 1st Mortgage
No first Time Homebuyer Requirement
Cash Back DPA: POC Items + $100 available at Closing
ADDI: POC Items 9
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HOMEBUYER EDUCATION CLASS FOR ADFA PROGRAMS
Education Course Requirements
One Borrower Both Borrowers None
Any Loan + ADDI
HFA Advantage
Conventional + DPA
*
FHA + DPA
VA + DPA
RD + DPA
*Course must be completed by at least one borrower, if all are first time homebuyers by
Freddie Mac guidelines. Follow each programs specific guidelines to meet compliance.
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HFA ADVANTAGE FREDDIE MAC HFA CONVENTIONAL LOAN
MOVE-UP: 1ST MORTGAGE
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HFA ADVANTAGE PROGRAM GENERAL GUIDELINES
Freddie Mac HFA Advantage
Maximum Rations 97% LTV ; 105% TLTV Credit Score 640
Debt-To-Income Maximum is 45%
Underwriting LPA (No Manual Underwriting permitted)
Restrictions No Income Limits
Sales Price Conforming Loan Limit
Primary Residence Only
Benefits Affordable Income Subsidy Grant (AIS):
At or Below 50% AMI $2,500
or
Above 50% but at or Below 80% AMI $1,500 12
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Affordable Income Subsidy Grant (AIS) Limits as published by FREDDIE MAC
Borrowers at or below 50% of AMI (Area Median Income) are eligible for an AIS Grant for $2,500.
Borrowers above 50% of AMI but at or below 80% AMI are eligible for an AIS Grant of $1,500.
Income Limits for the AIS Grant are determined by the county location of the home.
If borrower qualifies, they may receive the AIS Grant, ADFA DPA or ADFA ADDI, and a Mortgage Credit Certificate—these programs are stackable.
Eligible Usage: Down Payment, Closing Cost and Post Closing Items only.
Must be disclosed separately as “AIS” in Section L of Closing Disclosure.
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MORTGAGE INSURANCE COVERAGE: FHA & HFA ADVANTAGE COMPARISON
Lower down payment required with HFA Advantage
Conventional monthly mortgage insurance automatically ends when the LTV drops to 78%. Single Premium coverage is Life of Loan with no additional cost.
Lower monthly payments for HFA Advantage can result in substantial savings over time.
HFA Advantage is easier to originate.
LTV Standard HomeReady HFA
Advantage
95.01 - 97.00% 35% 25% 18%
90.01 – 95.00% 30% 25% 16%
85.01 – 90.00% 25% 25% 12%
80.01 – 85.00% 12% 12% 6%
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FHA & HFA ADVANTAGE COMPARISON with 3% DOWN PAYMENT ASSISTANCE
FHA*
96.5% LTV
Rate 5.375% **Upfront $ monthly MI
HFA Advantage
97% LTV Rate
Rate 5.750% Borrower paid monthly MI
HFA Advantage
97% LTV Rate
Rate 5.750% Non-refundable single
premium (1.77%) paid by the
borrower or use HFA DPA or
closing cost assistance funds
Down Payment $6,125 $5,250 $5,250
Down Payment Savings $875 $875
Monthly Payment $1,481 $1,474 $1,391
Upfront MI 1.75% 0.00% 1.77%
Monthly MI Rate 0.85% ***0.59% 0.00%
MI Term Life of Loan Cancels at 78% LTV Life of Loan, no other cost
**5 year Est. MI Cost $9,765 $4,980 $3,005
Monthly Cost Savings (1 Year) **Private MI Cost Savings vs. FHA for 5 years
(60mo MI payments + any upfront MI premium)
$7 $90
$4,785 $6,760 18
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ADDI ARKANSAS DREAM DOWN PAYMENT INITIATIVE
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ADDI PROGRAM GENERAL GUIDELINES
NEW! 10% of purchase prices, up to $10,000
5-Year term forgivable, soft 2nd mortgage loan
Can be used for Down Payment, Closing Cost, and POCs.
Income Restricted: 80% of area Median Income or below
No 1st time homebuyer requirement: Primary Residence only
Requires Homebuyers Education class for borrower (s), due prior closing
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ADDI PROGRAM GENERAL GUIDELINES
Household Income Limits at 80% of
Median Income.
Income is based on the number of
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ADDI HEALTH QUALITY & SAFETY INSPECTION
U.S. Department of Housing & Urban Development requirement
New! You pick your inspector
ADFA pays initial & final inspection ($125 + 42¢ / Mile)
ADFA must dispatch inspectors in order to pay them
20-30 minute inspection maximum
Tech-Savvy inspector (Scan Docs & Email)
ADDI Funds cannot be use for repairs or to pay down debt. Only available with ADFA Move-Up (No Stand-Alone)
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ADDI HEALTH QUALITY & SAFETY INSPECTION
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PROGRAMS » ADDI » PRE-PURCHASE HOMEBUYER EDUCATON CLASS
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DPA DOWN PAYMENT ASSISTANCE
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DPA PROGRAM GENERAL GUIDELINES
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From $1,000 up to $10,000
10-year Amortization Term, 2nd Mortgage
Rate: Same as 1st Mortgage
No Additional Inspections Requirements by ADFA
No Household Income Limit
No Purchase Price Restriction (no jumbo)
Can be used for Down Payment, Closing Cost, and POCs.
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DPA PROGRAM GENERAL GUIDELINES
DPA Assumes the lending guidelines of “ADFA MOVE-UP”
Interest rate matches 1st Mortgage (Move-Up)
Only available with ADFA Move-Up (no stand-alone)
Borrower does not have to be a 1st time homebuyer
Cannot be used for repairs or to pay debt to qualify
Borrowers may increase Down Payment thus reducing First Mortgage amount
Borrower can receive POC items back at closing, plus additional $100 27
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ADDI & DPA PROGRAM COMPARISON
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ADDI & DPA DPA ADDI
Amount $1,000 to $10,000
Affordable 2nd Mortgage
10% of purchase price,
up to $10,000
Affordable 2nd Mortgage
Term 10-Year Amortization,
2nd Mortgage
5-Year Forgivable, Soft 2nd
Mortgage*
Rate Matches 1st Mortgage N / A
ADFA Program Move-Up Move-Up
Homebuyer Education
Course
Program Guidelines Requires Pre-Purchase
Homebuyer Education Class
Household Income Limits No Limits 80% Area Median Income or
Below
Inspection No Inspection HQS Inspection Required**
Fees NONE NONE
* No monthly payments. Pro-Rated over 60-months.
** ADDI: Income verification needs to be approved before ordering HQS Inspection.
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RESERVATIONS
MOVE-UP, ADDI, DPA, & MCC
70-day purchase timeline remains in effect from date loan is reserved or ‘locked’ in our Reservation System.
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If ADFA has not received a closing package within 70
days of the reservation date, the reservation will
automatically be cancelled.
MCC MORTGAGE CREDIT CERTIFICATE
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MORTGAGE CREDIT CERTIFICATE
We are not Tax Professionals and cannot give tax advice. We will provide examples of how the MCC
works. We recommend that borrowers seek the advice of a qualified tax professional when
deciding whether or not to take advantage of an MCC.
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MORTGAGE CREDIT CERTIFICATE Dollar-for-Dollar Federal Tax Credit
BORROWER MUST BE ONE: 1st time homebuyer (no primary residence ownership within last 3 years), OR purchasing home in a targeted county, OR a Veteran or spouse of a Veteran
IRS Restrictions by County & Household Income Limits
Federal Tax Credit 50% of Mortgage Interest up to $2,000 per year
Purchase Price Limit is $270,000
FREE with ADFA Mortgage products (OPTIONAL: $150 Lender Fee)
-1/2% Issuance Fee, for Stand-Alone MCC.
Homebuyer can adjust federal withholdings to increase take home pay by $166 per month. (Should check with tax professional first)
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MORTGAGE CREDIT CERTIFICATE Dollar-for-Dollar Federal Tax Credit
Borrower claims Tax Credit when they file their Form 1040 annually, and must use Form 8396 to claim the credit.
A first-time homebuyer is an eligible borrower who has NOT had a present ownership interest in a principal residence at any time during the three year period prior to the date of closing. This ruling applies to a non-borrower spouse or any co-occupant.
A Targeted County is a qualified census tract or an area of chronic economic distress as designated by the IRS.
Each county has an Income Limit that the household cannot exceed based on the size of the household.
ADDI funds may be used for MCC fees 34
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MORTGAGE CREDIT CERTIFICATE Dollar-for-Dollar Federal Tax Credit
50%
50%
EXAMPLE*: $7,000 MORTGAGE INTEREST
50% you might use as a
deduction, just as normal.
MCC might allow you to deduct up to
50% of the mortgage interest owed up
to a maximum of $2,000.
*This example is use for ADFA MCC Education purposes only and shall not be use as a guide or
tax advice, for the MCC, or any other of our programs; and shall not represent the ADFA nor any of
its employees. Please consult with a professional to see what best benefits your financial picture.
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WITHOUT MCC example:
GROSS INCOME $50,000
MORTGAGE INTEREST $7,000 DEDUCTION
TAXABLE INCOME $43,000
FEDERAL INCOME TAX $6,450
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WITH MCC example:
GROSS INCOME $50,000 50% $3,500 MORTGAGE INTEREST $7,000 DEDUCTION
$46,500 TAXABLE INCOME $43,000 “Taxed @15%” $6,975 FEDERAL INCOME TAX $6,450 Max MCC Credit $2,000 TOTAL TAXES DUE $4,975 SAVED $1,475 3
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MORTGAGE CREDIT CERTIFICATE RECAPTURE TAX DISCLOSURE
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I. Your home is sold or disposed of within 9 years of being purchased, for reasons other than death; and
II. There is a capital gain on the sale of your home, and
III. Your household income for the year in which you sell your home exceeds federal recapture tax limits.
MCC CAN’T reduce your Federal Income Tax if you don’t owe
any taxes!
We estimate that 97% of the borrowers will not be subject to the
Recapture Tax. For more information regarding this provision,
please contact the IRS or a tax professional.
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ServiSolutions CONTACT INFORMATION
HOURS OF OPERATION:
8 AM to 5 PM, Central Time Monday through Friday
BY TELEPHONE:
If you only want to make a payment by phone and do not need to speak to a customer service representative, select OPTION 1 from the phone menu. Please have your account information ready.
334.244.4350 866.339.2432 (Toll free)
BY FAX:
Please ensure your loan number is listed on your fax
request.Customer Service: 334.271.3104
BY EMAIL: [email protected]
TO ADDRESS A MORTGAGEE CLAUSE:
ServiSolutions, a division of the Alabama Housing Finance Authority ISAOA ATIMA P.O. Box 242967 Montgomery, AL 36124-2967
If you have any questions, email [email protected].
ALL OTHER INQUIRIES:
P.O. Box 242967 Montgomery, AL 36124-2967
FOR DELIVERIES AND PAYOFFS:
7460 Halcyon Pointe Drive, Suite 200 Montgomery, AL 36117
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ADFA CONTACT INFORMATION
OUTREACH TEAM
Tim Wooldridge
Director of Outreach
(870) 926-8758
Kyle Putman
Outreach Specialist-Northwest
(501) 551-1276
Issac Morales
Outreach Specialist-Central
(501) 765-6543
Derrick Rose
Public Information Officer
(501) 682-5904
COMPLIANCE TEAM
Denise Wells
Single Family Assistant Manager
(501) 682-5466
Dean Norman
Single Family Compliance
(501) 682-5935
Virginia Wright
Single Family Compliance
(501) 682-5923
Leslie Quisenberry
Single Family Compliance
(501) 682-5930
900 W Capitol Ave, Suite 310
Little Rock, AR 72201
(501) 682-5900
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