. .....  
 
FHA Loan Limits VA Loan Limit Lenders Allow 
1-  $219,849 $203,000 Maximum!!!  
2-  $281,358 Funding Fees  (Subsequent use) LTV's Guard 
3-  $340,083 95.01 or >    3.00%  2.00%  2.75%
4-  $422,646 90.01 To 95.00  1.50%   1.50%  2.25% 
90.00 or<       1.25%  1.25%   2.00%   
(New-Dec,99) FHA limits are now being figured as 87% of the conforming limits.
Alameda County, CA The VA Funding Fee for all Rate Reduction Refi's is .50
 
Maximum loans w/o Funding Fee: 

· Discount points and rates are negotiable between the borrower and the lender.  

· Sellers have required closing costs that they have to pay if they are charged to the client.  The buyer is not allowed to pay certain fees.  
They are different for VA and FHA requirements, so be sure that you know which is which. 
Email me with any questions.  
Follow up: 

· On a VA loan, the VA Funding Fee is NOT charged if the Veteran is receiving disability payments for a service related disability.  

· The VA Funding Fee can be paid in cash OR financed into the loan as long as the total loan DOES NOT go above the maximum loan limit.  

· On a purchase transaction the closing costs may NOT be financed  on a VA loan except for the VA Funding fee. On a refinance the Veteran can finance existing indebtedness and all costs associated with the loan. The loan amount may not exceed $203,000.  On a regular refinance loan, the appraised value multiplied by 90% equals the base loan amount prior to calculating the VA Funding Fee.  The Veteran can receive cash back.  
The maximum loan amount is $203,000.  There must be an existing lien on the property. The Veteran may refinance an existing VA loan.  The VA  
Rate Reduction Refinance worksheet must be used to calculate the loan amount. The Veteran may not receive any cash back.  

· VA does not have a minimum guaranty requirement, however, the secondary market does.  Most investors will buy a "No Down" VA loan with a minimum 25% guaranty.  VA will automatically give a 25% guaranty on all Rate Reduction Refinance loans.  

REMEMBER: VA WILL ISSUE A GUARANTY FOR ANY AMOUNT PERMITTED AS BASED UPON THE VETERAN'S ENTITLEMENT. JUST BECAUSE YOU GET THE GUARANTY CERTIFICATE DOES NOT MEAN IT WILL MEET THE INVESTOR'S REQUIREMENTS.  
YOU MUST ALWAYS BE SURE THAT THE GUARANTY FROM THE VA WILL BE AT LEAST 25%.  

Seconds are OK with VA (Must follow these 7 Guidelines).  
1.  The Veteran must have full entitlement.  
2.  The total of the 1st and 2nd cannot exceed the CRV. (The VA 1st may not exceed $203,000 on a purchase).  
3.  The second must be fully amortized (any number of years).  
4.  There can be no balloon payments or due on sale clauses.  
5.  NEW - The interest rate on the second can now be different than the first but it has to be reasonable according to industry standards if it is higher than the first, or the rate can be lower than the first.  
6.  The Veteran must be able to qualify for both payments on the 1st and 2nd.  
7.  A copy of the 2nd note must be submitted to VA along with the loan package.  

Calculations for a Maximum 2nd under a Maximum VA loan purchase:  
1.  Multiply the value (lesser of the appraised value or sales price) by 75%.  
2.  Add 25% of the maximum entitlement (in this case $203,000 X 25%).  
3.  Subtract the maximum VA loan.           
Example: 
   $225,000   x    75%  
  168,750  +  50,750     25% of Max. Entitlement (.25 x 203,000)  
  219,500  
  -203,000     Less Max. VA loan  
  16,500  
ALWAYS MAKE SURE THE VETERAN HAS AN HONORABLE DISCHARGE BEFORE YOU START.  

FHA SECONDS - No secondary financing for minimum down payments allowed.  
MIP is always required no matter how much down or if there is a second.  
It must stay on for the life of the loan  

FHA LOANS - 203 b PROGRAM: LOAN - TO - VALUE (Owner - occupancy only)*  
    NEW GUIDELINE:  The Borrower has to have a Minimum Required Cash of 3% down of the Sales Price and they pay their own closing costs. However the Seller can still pay up to 6% of the Sales Price towards the Closing Costs including the Recuring Closing Costs. 

 
Borrowers Allowable/Unallowable Closing Costs:
CLOSING COSTS 
VA
FHA
Administration Fee 
No
No
ALTA Policy       
YES
 YES*
ALTA Inspection Fee 
NO 
 NO 
Application Fee
NO 
NO  
Appraisal Fee
YES
YES*
Appraisal Reinspection       
NO
YES* (ONE)
Appraisal Review
NO
NO
CHFA Fee
NO
YES* ($350)  
City Transfer Tax
NO 
NO**  
CLTA/Owners Policy  YES  YES* 
County Transfer Tax NO     NO
Credit Report YES  
  YES*
Discount Points
YES 
YES 
Document Preparation 
NO  
 NO
Energy Rating 
NO
YES (up to $200) 
Endorsement Fee
NO 
 YES*** 
Escrow Fee/Closing
NO
YES* 
Federal Express
NO 
YES***  
Flood Certification
NO
NO
Grant Deed 
NO
YES**** 
Homeowners Protection
YES
YES (up to $300)
H/O Assoc. Transfer Fee
NO 
YES  
Lock Fee
NO
NO  
MCC Fee
YES 
YES* ($200)  
Notary Fee
NO
YES*  
Origination Fee
YES
YES*
PMI
NO
NO
Processing Fee
NO
NO 
Quit Claim
NO
 YES****  
Real Estate Commission 
NO
YES
Reconveyance 
YES
 YES****  
Recording Fee
YES
YES*
Redraw Fee 
NO
NO  
Referral Fee
NO
NO
Repair Work
NO
YES  
Rush Doc Fee
NO
NO 
Survey
NO
YES***
Tax Service Fee
NO
NO 
Termite Clearance
NO
YES 
Termite Report 
NO
YES*
Tracking Fee
NO
NO
Truth in Lending Fee 
NO
NO
UFMIP/OTMIP 
NO
YES
Underwriting Fee
NO
NO
VA Funding Fee
YES
NO
Wire Fee 
NO
NO
  
 *   Non-recurring costs that can be financed by the borrower  
 **     Unless property is in the city of Sacramento. Sales contract  
must state borrower to pay ½.  
 ***   If written notice is given to the borrower or disclosed in the  
Good Faith Estimate.  
 **** Refinance Only - Prepared by Connie Gibson 
 
FHA/VA UPDATES
  
 
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