NOFA - MFA - Housing New Mexico

NOTICE OF FUNDS AVAILABILITY (“NOFA”)
RE: NEW MEXICO MORTGAGE FINANCE AUTHORITY
HERO TBA MORTGAGE PROGRAM
February 1, 2014
The New Mexico Mortgage Finance Authority ("MFA") has instituted a forward delivery “To Be
Announced (“TBA”) program to make funds available under its single family mortgage backed
securities program (the "MBS” Program) to finance the purchase of Mortgage Loans, which are
insured by the Federal Housing Administration (“FHA”) and securitized in Ginnie Mae MBS.
Except as otherwise defined herein, capitalized terms used in this Notice of Funds Availability
shall have the same meanings as the capitalized terms defined in the HERO Program Mortgage
Purchase Agreement. In the event of a conflict between the provisions of this Notice of Funds
Availability and the provisions of the HERO Program Mortgage Purchase Agreement for a
Mortgage Loan, the provisions of the HERO Program Mortgage Purchase Agreement shall
control. The MFA may amend the provisions of this Notice of Funds Availability (“NOFA”) from
time to time.
To participate in the HERO TBA Mortgage Program, your institution must have been approved
by MFA as a Mortgage Lender, have executed a Homeownership Program Master Agreement
with MFA and been approved by the MFA Master Servicer. MFA approval as a Mortgage
Lender is evidenced by the issuance to your institution of MFA's "Notice of Approval". If you
have not been approved to participate in the MBS Program, you may submit an "Application for
Approval" to the MFA Homeownership Department. Approved Mortgage Lenders may now
make loan reservations under the HERO TBA Mortgage Program.
MFA will finance the purchase of Eligible Mortgage Loans as set forth in the applicable HERO
Program Mortgage Purchase Agreement and the HERO TBA Mortgage Program Documents.
Funds used to finance the purchase of the Mortgage Loans will be reserved in accordance with
the Reservation and Compliance Procedures, as amended from time to time. MFA’s
Commitment and the Master Servicer’s purchase of each Mortgage Loan will be subject to the
execution of an individual HERO Program Mortgage Purchase Agreement signed by the
Mortgage Lender and the Master Servicer, as amended from time to time and any conditions
thereto.
Funds made available through a TBA execution will be used to purchase securities, backed by
the Eligible Mortgage Loans, and guaranteed by GNMA. The purchase of the MBS will be
governed by a Master Mortgage Pooling and Servicing Agreement between MFA and the
Master Servicer. All Mortgage Lenders will sell the Eligible Mortgage Loans and release their
servicing rights to the Master Servicer selected by MFA to service the HERO TBA Mortgage
Program.
The terms and conditions applicable to the program are expected to include the following:
1. ACQUISITION POOL
MFA will establish an acquisition pool (the "Acquisition Pool") from
which it will finance the purchase of MBS backed by Eligible
Mortgage Loans. The Acquisition Pool will be continuously
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available and sufficient to purchase MBS backed by Eligible
Mortgage Loans.
2. ACCEPTABLE LOAN TYPES
Each Mortgage Loan delivered for purchase must be Federally
Insured (FHA) and must be eligible for pooling as a GNMA MBS,
as set forth in the applicable guidelines of GNMA.
Targeted Occupation Definitions
3. Initial Allocation
At least one borrower must qualify under one of the
following options; teacher, safety worker, health care
worker or a member of the United States Armed Forces.
Following are the definitions:
Teacher – One of the borrowers must be an employee of
an accredited or state chartered private or public school; a
certified teacher or administrator in an education agency;
or an employee of a post-secondary level educational
institution.
Safety Worker – One of the borrowers must be an
employee of a law enforcement agency or fire department
administered by an agency or subdivision of a state or
local government; or a sworn law enforcement officer
responsible for crime prevention and detection, law
enforcement, or criminal incarceration; or a sworn member
of a fire department involved in the fire suppression or
prevention, emergency medical response, hazardous
materials response, or management or response to
terrorism.
Health Care Worker – One of the borrowers must be a
certified, accredited, or licensed health care worker who is
a medical resident or fellow; a nurse, nursing assistant,
pharmacist, pharmacy technician, physician's assistant, or
medical technician, technologist, or therapist.
Active Member of Armed Forces – One of the borrowers
must be a current member of the United States Armed
Forces (Active or Reserve).
$10,000,000.00 will be made available to finance the HERO TBA
Program. Additional allocations will be made available as dictated
by market conditions and program demand.
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4. UNDERWRITING
a. Mortgage Lenders are responsible for credit and collateral
underwriting and for determining whether a loan qualifies
under FHA guidelines. Lenders may run the loan through
Desktop Underwriter, Loan Prospector or manually
underwrite the loan.
Non-occupying co-signers are allowed according to
applicable guidelines of FHA/MFA.
Temporary Buydowns are not allowed according to the
TBA Program Guidelines.
The Master Servicer will not re-underwrite the loans for
eligibility but will provide post-closing review for
compliance with MFA guidelines.
b. Maximum LTV guidelines are as defined in the FHA
handbook regarding Mortgage Credit Analysis for
Mortgage Insurance on One-to-Four Units Mortgage Loans
(section 4155.1).
c. Maximum CLTV is as defined in section 4155.1 and
Mortgagee Letter(s) 1994-03 and 2002-22.
d. A minimum contribution of $1,000 from the borrower’s
own funds is required and cannot be derived from any
type of gift, grant or down payment assistance. The
Mortgage Lender will be required to provide proof of
the borrower’s own funds.
5. COMPLIANCE REVIEW
A Compliance Review is required on all HERO TBA
Program Mortgage Loans, prior to closing. MFA will
provide pre-closing Compliance Review services on all
Mortgage Loans and will issue a Compliance Approval for
all Mortgage Loans. The Compliance Review will involve
compliance with the HERO TBA program guidelines,
including, but not limited to Household Income, Acquisition
Cost, Targeted Occupation and prior homeownership.
Mortgage Lenders must have proof of Compliance
Approval in the Mortgage Loan file prior to loan purchase
by the Master Servicer.
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6. LOAN RESERVATION
7. LOAN CANCELLATION
8. LOAN CLOSING
9. MORTGAGE STRUCTURE
All loans must be reserved via MFA’s On-Line Reservation
System found on MFA’s website: www.housingnm.org. Loans
may be reserved from 9:00am-5:00pm, Monday through Friday,
excluding holidays. Loan reservations for the HERO TBA
Program will not be accepted outside the reservation window.
Lender may then print the HERO Mortgage Purchase Agreement
upon submitting the reservation.
60 day loan purchase period: The HERO TBA Program first
mortgage must be purchased by the Master Servicer no later than
60 days after the loan reservation date.
A loan reservation may be cancelled at any time without penalty.
A new reservation/rate lock will not be allowed until 60 days after
the previous loan reservation/rate lock cancellation.
A Mortgage Lender may not close a Mortgage Loan until the
Mortgage Lender receives a Compliance Approval (“commitment”)
from MFA for such Mortgage Loan. A commitment may not be
issued nor will the Master Servicer be obligated to purchase a
Mortgage Loan that has been closed with terms or conditions that
are materially different from that shown on the HERO Program
Mortgage Purchase Agreement.
Each Mortgage Loan must have a 30-year term and amortizing,
substantially equal monthly payments of principal and interest (in
amounts sufficient to amortize the principal amount of the
Mortgage Loan over the term thereof) due on the first day of the
calendar month the first payment of which shall commence no
later than sixty (60) days following Closing, and a fixed interest
rate at the respective mortgage note rate.
HERO TBA program loans include a HERO DPA grant of 3.00%
of the total loan amount (with MIP included).
10. LOAN DELIVERY
a. Delivery Dates
No loan purchase schedule will be published. Mortgage Lenders
may deliver loans as soon as they are ready to be shipped. The
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Master Servicer will purchase loans on a daily basis.
The Mortgage Loan Purchase Date (the final date on which a
Mortgage Loan may be purchased by the Master Servicer in
satisfaction of the Mortgage Lender's obligations under a HERO
Mortgage Purchase Agreement) will be no later than:
1. 60 calendar days after the loan reservation, or;
2. 75 calendar days after the loan reservation, if the loan
has been approved for a 15 day loan reservation
extension. The extension fee is 0.1875% of the loan
amount. A loan reservation must be approved by MFA
and must be documented in the file.
3. 90 calendar days after the loan reservation, if the loan
has been approved for a 15 day loan reservation
extension. The extension fee is 0.375% of the loan
amount. A loan reservation must be approved by MFA
and must be documented in the file.
b. HERO Delivery Package
Mortgage Lenders must deliver the HERO Delivery
Packages, as described in the Reservation and
Compliance Procedures, to the Master Servicer by the
dates shown on the HERO Program Mortgage Purchase
Agreement or Extension Notice.
c. Final Documents
So that the Master Servicer may certify all MBS pools,
Mortgage Lenders must clear all outstanding
conditions/exceptions related to final document delivery
within 90 days of purchase of the Mortgage Loan.
11. SERVICING
Mortgage Lenders will sell HERO TBA Program Loans to the
Master Servicer and will release the servicing to the Master
Servicer.
a. Servicing Documents
The Mortgage Loans will be collateral for a GNMA MBS.
Servicing will be performed according to the applicable
guidelines of GNMA.
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. Servicing Rights Fee
The Master Servicer’s will pay MFA a Servicing Rights Fee
as consideration for MFA directing Mortgage Lenders to
sell Mortgage Loans, Servicing Released, to the Master
Servicer in accordance with the terms of the Master
Mortgage Pooling and Servicing Agreement between MFA
and the Master Servicer.
c. Servicing Release Fee
The Master Servicer’s will pay Mortgage Lenders a
Servicing Release Fee, determined by MFA, for
relinquishing servicing rights of the mortgage loan to the
Master Servicer at the time of loan purchase by the Master
Servicer.
The compensation paid will be based on the outstanding
principal balance of the mortgage loans as follows:
Idaho Housing and Finance Association will pay a
Servicing Release Fee of one and fifty hundredths
percent (1.50%) of the outstanding principal balance,
or a minimum of $750 of eligible HERO Program loans.
The Servicing Release Fee compensation may be
changed by MFA from time to time by amendment to this
Notice of Funds Availability.
d. Servicing Transfer
The Mortgage Loan will be purchased and serviced by the
Master Servicer. This means that the Mortgage Note will
be endorsed, and the Mortgage assigned to the Master
Servicer. At the time of Mortgage Loan purchase by the
Master Servicer, the Mortgage Lender will transfer all
servicing rights to:
Idaho Housing and Finance Association, Its successors
and or assigns
P.O. Box 7899
Boise, Idaho 83707-18909
Attn: Susan Semba Vice President,
Homeownership Lending
The Mortgage Lender is responsible for (i) transferring all escrow
balances held to the Master Servicer (ii) for notifying the borrower
of the transfer with a "goodbye" letter which meets the
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equirements of RESPA and all other applicable regulations, and
(iii) for transferring to the Master Servicer any applicable
insurance policies and guarantees. (See Section 15)
12. MORTGAGE NOTE RATE
The Mortgage Note Rate for the HERO TBA program loans will
vary based on market conditions.
13. DISCOUNT FEE
There is no Discount Fee charged to the borrower under the
HERO TBA program.
14. ORIGINATION FEE
There is no Origination fee charged to the borrower under the
HERO TBA program. Mortgage Lenders will receive an origination
fee from the Master Servicer, on behalf of MFA, of one percent
(1%) of the Mortgage Loan Amount set forth in the HERO
Program Mortgage Purchase Agreement.
15. PURCHASE PRICE, OTHER FEES & WIRE AMOUNT
The Master Servicer will purchase the loan from the Mortgage
Lender via funds wire to the applicable Mortgage Lender's
account. The purchase price of HERO TBA program loans will be
the sum of one hundred one percent (101.00%), less any
extension fees as of the date of purchase, (ii) the servicing release
fee (as described in Section 11c. above), (iii) accrued interest to
the date of purchase minus (iv) any fees. The amount of the wire
will be the purchase price less any amounts held in escrow
(including additional amounts necessary to make up for any
escrow shortage).
The MFA will fund the 3.00% premium to the title company at the
time of closing. The lender will send the required documentation
to MFA 48 hours before the scheduled loan closing.
16. INCOME LIMITS
The borrower's Current Annual Household Income must not
exceed the Household Income Limits set forth in Exhibit A.
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17. ACQUISITION COST LIMITS
The Acquisition Cost of Residential Housing to be financed with
the Mortgage Loan must not exceed the Acquisition Cost Limits
set forth in Exhibit A.
18. RESIDENTIAL HOUSING
The Mortgage Loan must be for the purchase of Single Family
Residential Housing.
a. Residence has one (1) kitchen and no rental units
19. FIRST-TIME BUYER/NON FIRST-TIME BUYER
If a borrower is a first-time home buyer, a member of the Targeted
Occupation as defined in Section 2 and is over income for the
Mortgage$aver Program, the loan may be reserved under the
HERO TBA Program.
There are no First-Time homebuyer requirements under this
Program. However, the borrower cannot be in title to any other
property at the time of purchase.
For purposes of qualifying for the Mortgage Loan, the borrower
may use a Non-Occupant Co-Signer. The Non-Occupant Co-
Signer will be liable for the Mortgage Loan debt (must sign the
Note), but will not have a real estate interest in the property being
financed.
20. HOMEBUYER COUNSELING
21. RECAPTURE
Homebuyer Counseling is required for First Time Homebuyers
only.
eHome America Online Pre-Purchase Homebuyer Counseling or
face to face/group Pre-Purchase Homebuyer Counseling provided
through an MFA approved Housing Counseling agency are
acceptable methods of Pre-Purchase Homebuyer Counseling.
There are no "Recapture" requirements under this Program.
22. TAX EXEMPT RIDER
A Tax Exempt Financing Rider is not required.
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23. RESERVATION REQUEST
All Reservations must be made via MFA’s on-line reservation
system found on MFA’s website: www.housingnm.org.
24. AFFIDAVITS
The Affidavits of Purchaser and Seller are not required.
25. ASSIGNMENT OF MORTGAGE
MFA will not issue a form of assignment to be used in connection
with Mortgage Loans in this issue. Mortgage Loans must be
assigned to the Master Servicer of the mortgage loan.
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Exhibit A
1. INCOME LIMITS The current annual household income of the borrower(s) may not exceed
the applicable Income Limit described below:
Geographic Areas
Albuquerque MSA
(Bernalillo, Sandoval,
Torrance and Valencia
Counties)
Santa Fe and
Los Alamos Counties
Income Limits
1 or More Person Household
$75,480
$74,400
All other areas of the state $65,040
The Income Limits described above are subject to change and may be amended by MFA.
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2. ACQUISITION COST LIMITS
The Acquisition Cost of the Residence financed with a Mortgage Loan may not exceed the
applicable Acquisition Cost Limit described below:
Area
Los Alamos County and
Santa Fe County
Acquisition Cost Limit
$342,585
All other areas of the State $243,945
The Acquisition Cost Limits described above are subject to change and may be amended by
MFA.
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