BCF FHA Guide - bcfwholesale.com

1 FHA Loan Program - Quick Reference Guide Eligible Products LTV / CLTV Matrices FHA Traditional Occupancy Purpose Units Base LTV CLTV. 15, 20, 25 and 30 year Fixed Rate Purchase 1- 4 5, 6 1, 5, 6. Rate / Term 1- 4 15 year products are limited to conforming loan balances Primary Residence Cash-Out 1- 4 85% 2 85% 2. 5/1 fully amortizing Hybrid ARM with 1/1/5 caps Streamline with Appraisal 1- 4 3 125%. All 7 Streamline without Appraisal 1- 4 100% 3, 4 125% 4. FHA Select 1. In some cases (subordinate financing provided by a family member, private individuals, other organizations/. 25 and 30 year Fixed Rate non-government agencies, a borrower >60 years of age, etc.) subordinate financing may be as high as 100%. 5 year ARM. CLTV. Subordinate financing provided by a government entity may exceed 100% CLTV by the "cost to acquire the Program Features property".

2 Credit scores as low as 600. All products are Fully-Amortizing 2. Maximum LTV / CLTV is 80% if Conforming Select or 75% if High Balance Select. 3. Non-Credit Qualifying Streamlines: New base loan amount may not excced the original base loan amount. HUD REOs with repair escrows allowed 4. LTV / CLTV for Streamline Refinance without appraisal is based on the original loan amount. Low down payment requirements Manual Underwriting allowed 5. Maximum 110% LTV / CLTV for HUD REO with escrow repair transactions.. 6. Maximum 100% LTV / CLTV for HUD REO $100 Down Payment program transactions. Gift funds allowed for down payment and closing costs No temporary buydowns 7. ARMS not allowed for second homes or investment properties. Loan Limits Minimum Credit Scores The maximum base loan amount (excluding UFMIP) cannot exceed the FHA.

3 Statutory Mortgage Limits for the applicable country. Feature Traditional Select Purchase and Rate / Term * 580. 620. Conforming Balance High Balance Refinance * 600 if High Balance Units (Maximum) (Minimum to Maximum) * 580. Streamline 620. 1 $ 417,000 $417,001 to FHA County Limit * 600 if High Balance 2 $ 533,850 $533,851 to FHA County Limit Borrowers without a Credit Not Eligible * Assume 580 for pricing 3 $ 645,300 $645,301 to FHA County Limit Score 4 $ 801,950 $801,951 to FHA County Limit * Conforming Balance: * 580 if LTV > 75% to < 80%. Cash Out Refinance 620. * High Balance: * 600 if LTV < 75%. For business and professional use only. Not for consumer distribution. This document is not an advertisement as defined in 12 CFR (a) (2). All products are subject to credit and property approval. Other restrictions and limitations may apply.

4 BRE License # 01846368 * NMLS # 303222 * Subject to change without notice. All rights reserved. Equal Housing Lender. Program Overlays and Conventional Comparison This table highlights BCF Wholesales restrictions and overlays. Exceptions to these guidelines may be considered only with strong documented compensating factors. Note: This is summary information only. FHA Product Overlays - Apply to All Products Unless Stated Otherwise Below Overlay Type Overlay Guidelines Borrower * Title may not be taken in the name of a Trust. Credit * Credit score must meet the minimum requirements per the matrix above. TOTAL Scorecard Approve/Eligible loans with 620 credit score: 55% (If manual downgrade required, following Manual Underwritten requirements below.). * 55%. * If manual downgrade required, follow Manual Underwriting requirements below Refer/Eligible or Manually Underwritten or Approve/Eligible with scores <620: * Reminder: Manual underwriting is required when credit score is <620 and DTI is >43% or when manual downgrade is required per / 49%.

5 Unless a lower DTI is required as defined below. * 45% maximum total DTI allowed when any of the following apply: Maximum Debt-to- * Payment shock exceeds 50% of current housing payment. Income Ratio (DTI) * Credit score is less than 620 and gift funds and/or Down Payment Assistance financing is used for down payment down payment or closing costs. * High balance loan amounts. * 43% maximum total DTI allowed when any of the following apply: * Borrower does not have a minimum of 6 months housing payments or rental history within the last 12 months * 40% maximum housing ratio allowed at the underwriter's discretion when the borrower's only debt is the subject property monthly housing expense * When non-traditional credit is used to supplement an insufficient number of tradelines: Ratios may not exceed 31% / 43% and must be computed only on those borrowers occupying the property.

6 Ratio increases based on compensating factors are allowed. * Note: Second level underwriting review required when ratios exceed 33/45%. * If there is a large increase in the borrower's account or if the account was recently opened, the borrower must provide a credible explanation and documentation to source large deposits for all transactions. A large deposit is considered the lesser of: Assets * A deposit that resulted in an increase greater than 25% of the borrower's gross monthly income; or * A deposit that is more than 2% of the sales price. Mortgage / Rental * Select loans with credit score <620 require verification of mortgage/rental history regardless of TOTAL Scorecard requirements. This does not apply History to borrowers who are currently living rent free provided the rent free status is documented.

7 Effective with case numbers assigned on or after October 15, 2013: * Judgments must be paid in full prior to loan approval, with the exception of court ordered judgments with payment arrangements in which three months scheduled payments were made prior to loan approval. Judgments Effective with case numbers assigned before October 15, 2013: * Court ordered judgments must be paid off if on title. * Judgments not on title may remain open if the borrower has a repayment plan in place with a minimum of two payments made prior to the contract date. For business and professional use only. Not for consumer distribution. This document is not an advertisement as defined in 12 CFR (a) (2). All products are subject to credit and property approval. Other restrictions and limitations may apply. BRE License # 01846368 * NMLS # 303222 * Subject to change without notice.

8 All rights reserved. Equal Housing Lender. FHA Product Overlays - Apply to All Products Unless Stated Otherwise Below Overlay Type Overlay Guidelines Property Listed For * Eligible for Rate/Term Refinance and Streamlines if listing was expired or cancelled prior to application date. Sale * Eligible for Cash-Out Refinance if listing was expired or cancelled >90 days prior to application date. * No Escrow Holdbacks, with the exception of HUD REO properties with HUD approved repair escrows. Property REO with Repair * Minimum $500 escrow repair account. Escrow * Signed 4506-T required on all loans except Non-Credit Qualifying Streamline Refinance transactions. * The 4506-T must be executed if tax returns are used to calculate income. * Income reported on the transcript must support the income entered in the AUS system.

9 Documentation * Any major discrepancies between the income verified in the file and tax transcripts must be reasonable and supported by documentation in the file. * BCF Wholesale completed Verbal VOE 5 days prior to closing is required on all loans. * All borrowers must have a valid social security number and SS# must be documented in the file. Traditional Select Conforming Balance High Balance Conforming Balance High Balance 15-Year F15 N/A N/A N/A. 20-Year F20 N/A N/A N/A. 25-Year F25 FJ25 G25 G25 HB. 30-Year F30 FJ30 G30 G30 HB. 5/1 Treasury ARM F51T F51 THB N/A N/A. Product Codes (All Streamline 15-Year F15 SL N/A N/A N/A. Fixed Rate) Streamline 20-Year N/A N/A N/A N/A. Streamline 25-Year F25 SL FJ25 SL G25 SL G25 SL. Streamline 30-Year F30 SL FJ30 SL G30 SL G30 HB SL. 5/1 Treasury ARM Streamline F51TS F51 THBS N/A N/A.

10 Flipping Waiver F30 FLP FJ30 FLP G30 FLP G30 HB FLP. For business and professional use only. Not for consumer distribution. This document is not an advertisement as defined in 12 CFR (a) (2). All products are subject to credit and property approval. Other restrictions and limitations may apply. BRE License # 01846368 * NMLS # 303222 * Subject to change without notice. All rights reserved. Equal Housing Lender. 1. Eligible Section of the Act DE ADP Code Brief Description 203(b) 703 Fixed Rate 203(b) 729 Adjustable Rate Mortgage 203(b) 734 Fixed Rate Site Condominium Allowable ADP 203(b) 731 Adjustable Rate Mortgage Condominium Codes 203(b) 821 Refinance of Borrower in Negative Equity Position (Non-condo). 234(c) 734 Fixed Rate Attached Condos 234(c) 831 Refinance of Borrower in Negative Equity Position (Condo).