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REMINDER
Effective June 28, 2024, Fannie Mae’s HFA Preferred will not be available in the HTH TBA Program or the standard TBA Program. Fannie Mae will only be available on June 28th and after with the standard Bond Program and the HTH Bond Program. The TBA HTH Guideline reflects Fannie Mae as a current option but keep in mind that the previous HTH program is winding down and loans are still be delivered and purchased so the Fannie Mae HFA Preferred may still apply to loans in the previous HTH Program.
HOMETOWN HEROES
FREQUENTLY ASKED QUESTIONS
Q. Do all borrowers on the loan have to qualify for HTH by working full-time for a FL based employer?
A. No. Only one occupying borrower must satisfy the employment requirement. Non-occupying co-signors cannot satisfy the employment re-quirement for the occupant borrower(s).
Q. Do borrower(s) have to qualify with an eligible occupation?
A. No. The former occupational requirement will no longer apply. One occupying borrower must work full-time with a FL based employer.
Q. Does HTH still require borrower(s) qualify by working 35 hours a week?
A. No. Borrower(s) must work full-time to qualify. Lenders will need to obtain a VOE or paystubs that reflect full-time status. The borrower’s employer determines full-time status.
Q. What documentation is required to confirm a borrower’s employer is a FL based company?
A. Borrowers that work at a physical location of employer can confirm with the Employer Address located on page 1 of the 1003 AND physical location of employer on the most recent paystub. Lender may also obtain a VOE validating borrower works from a specific FL location.
Borrowers that work remotely must report to, work from or be assigned to a specific location in FL. Employer simply having a physical location in FL will not qualify borrower.
Self-Employed borrowers must be Registered with the State of FL (Sunbiz.org) or licensed by the State of FL through the Department of Business and Professional Regulation (DBPR) AND
If borrower is a 1099 employee, they must provide a copy of their most recent 1099 validating contracted employer is a FL based employer OR a copy of their Schedule C confirming Proprietor’s Business Address is located in FL.
Q. What is the Debt-to-Income Ratio (DTI) for Hometown Heroes (HTH)?
A. Max DTI 50% but Manufactured Housing (MH) has a max DTI of 45% and manual underwrites have a max DTI of 43%
Manual underwriting permitted with FHA, VA, Fannie Mae and Freddie Mac ONLY.
Q. Does the borrower have to use any reserves for down payment since other programs that provide down payment require?
A. No. FL Housing does not require an asset test.
Q. Do you have to use all of the second mortgage funds if they are not needed?
A. Lenders should use the entire amount of eligible subsidy. The reservation system will auto calculate 5% of the total loan amount for the HTH Second Mortgage. The HTH Second is 0%, non-amortizing, deferred second mortgage.
Q. Do Veterans still qualify as first-time buyers under the new HTH Program?
A. Yes. Veterans that provide a valid DD214 with a discharge status of other than dishonorable are exempt from the employment requirement.
Q. Do active military personnel or members of the reserves still qualify as a first-time buyer (FTHB) under the new HTH Program?
A. If utilizing the BOND HTH Program, active military personnel must qualify as a first-time buyer by providing the last three years’ tax returns or transcripts (or a combination of the two) or a Verification of Rent or a copy of their lease. Active military personnel are also exempt from the employment requirement when providing a current LES. Members of the Reserves or National Guard must satisfy the employment requirement and are not exempt from the FTHB requirement.
If using the TBA HTH Program, active military personnel are exempt from the employment requirement AND the first-time buyer requirement when providing a copy of their Leave and Earnings Statement or Servicemembers’ Civil Relief Act form. Members of the Reserves or National Guard must satisfy the employment requirement and are not exempt from the FTHB requirement.
Q. Do you allow originators to participate in HTH if they are located in another state?
A. No. Originators must have a primary residence in FL in order to participate.
Q. How do you confirm a self-employed borrower works full-time?
A. A third party must confirm full-time status. Lenders may obtain a letter from borrower’s CPA, bookkeeper or tax preparer.
Q. Can a buyer who is retired qualify for HTH?
A. Other than veterans and active military personnel, all borrowers must be employed full-time to qualify.
Q. What does an originator need to do to be listed on FL Housing’s website as an approved loan officer?
A. Originators are required to have 4 PURCHASED loans within a 6-month period. FL Housing updates their website every January and July.
Q. Does the HTH Program consider household income?
A. YES and NO.
If using the BOND HTH Program, the household income is considered. The gross, annual income of all occupants aged 18 and older must be considered in the household income. Co-signor income is not considered in the household income since co-signors will not be a member of the household; they will not occupy the property.
NO. If using the TBA HTH Program, the AUS income is considered. Co-signor income would be considered in qualifying since co-signor income is considered in the AUS.
Q. Does the HTH Program require three years’ tax returns to validate first time buyer status?
A. YES and NO.
If using the BOND HTH Program, all borrowers (including NPS)) must provide confirmation of first-time eligibility with their last three years’ tax returns or transcripts (or a combination of the two) or a VOR or copy of lease.
If using the TBA HTH Program, the borrowers must complete the Declarations Section of the1003 accordingly.
Q. Does FL Housing allow co-signors for HTH?
A. Co-signors (Non-Occupying Co-Signors) are permitted with FHA, Fannie Mae’s HFA Preferred and Freddie Mac’s HFA Advantage only.
Co-signor income will NOT be considered in household income for the BOND HTH Program since they do not occupy the property.
Co-signor income IS considered in the TBA HTH Program since co-signor income is considered in the AUS approval.
Q. If my borrower(s) income exceeds the 80% AMI limits on a CONV HFA Preferred or HFA Advantage loan does that mean my borrower(s) does not qualify for HTH?
A. No. The 80% AMI income limits determine if a borrower(s) is eligible for reduced cost mortgage insurance and these limits are determined by the GSEs, not FL Housing. Refer to the HTH income limits to determine borrower(s) meet income limits for HTH.
Q. Why are there separate rates on conventional products up to 80% AMI and above 80% AMI?
A. Borrower(s) that have income that is at or below Fannie Mae and Freddie Mac’s 80% AMI limits (which are used in determining borrower’s eligibility for reduced rate mortgage insurance), would qualify for charter MI coverage AND a lower first mortgage rate.
Borrower(s) income that exceeds 80% AMI would receive standard MI and a higher first mortgage rate.
Remember: Lower AMI (80% AMI or below) = lower first mortgage rate and lower MI costs. Higher AMI (80% AMI and above) = higher first mortgage rate and higher MI costs.
Q. Is Manufactured Housing permitted in HTH?
A. Yes, but only for FHA, RD, VA and Fannie Mae’s HFA Preferred. Click here to view the Manufactured Housing information.
Q. What is the max Combined Loan-to Value (CLTV) for HTH?
A. FHA and VA do not have a max CLTV when using down payment assis-tance from a governmental entity like FL Housing. Fannie Mae and Freddie Mac have a max 105% CLTV. For max CLTV on USDA RD, refer to USDA-RD’s maximum CLTV requirements.
Q. Can borrower(s) receive their Earnest Money Deposit (EMD) back at closing?
A. NO. Refer to HTH Lender Guide for more information.
Q. Is the 203k or 203ks permitted in HTH?
A. Only the Limited 203 is permitted. View Lakeview’s Government matrix for more information here: https://www.lakeviewcorrespondent.com/hfa-matrices-and-resources/
Q. Do all borrower(s) have to attend homebuyer education in the HTH Program?
A. Only one borrower must attend homebuyer education. Currently, FL Housing Homebuyer Loan Program Staff recommend HomeView which is sponsored by Fannie Mae, it is available free online.
Q. What are the fees for HTH?
A. First mortgage loans originated under the HTH Program allow lender to charge their usual and customary origination fees. The 1% Origination Fee is NOT permitted.
First Mortgage Fees are:
$400 ( payable to Investor or Master Servicer) Funding Fee
$275 Compliance Fee (payable to eHousing)
$75 Tax Service Fee (payable to Investor or Master Servicer)
$10 Flood Certification Transfer Fee (payable to Investor or Master Servicer)
The HTH Second Mortgage only allows a recording fee.
Q. Does the HTH Program require specific training?
A. No. However, all lenders that participate and work with the HTH Program must attend mandatory program and system training. www.ehpuniversity.com
Q. Where do we obtain a copy of the HTH Certification Form that the buyer has to sign?
A. The HTH Certification Form is available in the reservation for lenders to pull at time of closing. You can also obtain a blank Attestation Form for buyer to complete from the eHousing website here: https://www.ehousingplus.com/homeownership/florida-housing-finance-corporation/program-highlights/
Q. If a borrower(s) no longer occupies the property and chooses to rent out the property, is the HTH Second Mortgage required to be repaid?
A. Yes. The HTH Second Mortgage is required to be repaid, in full, upon the sale, refinance, transfer of deed, payoff of the first mortgage or if the borrower(s) no longer occupy the property as their primary. A residence demand letter is issued to the borrower(s) if any of the above occur.
Q. Can the HTH Second Mortgage be used to bridge the gap between the purchase price and the appraised value?
A. No. FL Housing down payment funds cannot be used to bridge the gap between the purchase price and the appraised value and cannot be used to pay off borrower(s) debt. It also cannot be used to pay broker fees.
Q. Does the HTH Program allow down payment funds from another agency?
A. Yes. However, the agency providing the additional subsidy must take a subordinate lien position to FL Housing (3rd lien position).
Q. Does the DTI round up or down?
A. Lakeview will round up on DTI at the .50 mark and round down on DTI at the .49 mark.
Thank you for your continued support of the Florida Housing Programs!
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