Masters of Underwriting
Smoothing out the Home Saver
Underwriting Process
Mississippi Annual
Affordable Housing
Conference
Home Saver Program Guidelines
Compliance
Pipeline Management
Site Visits/Audits
Here We Come to Save
the Day……..
Summary of HHF Policy
Guidelines
Home Saver Program Goal
Unemployed
Underemployed
Reinstatement Only
Mortgage Assistance with Education
Option
Maximum Assistance
Terms of Assistance
Unemployed
To bridge eligible applicants across
a period of unemployment and allow
them to stay current on their
mortgage.
UNDEREMPLOYED
To bridge eligible applicants across
a period of underemployment and
allow them to stay current on their
mortgage.
REINSTATEMENT ONLY
To bring eligible applicants current
after a brief interruption or
reduction in income.
MORTGAGE ASSISTANCE
WITH EDUCATION
OPTION
Applicants are eligible for an additional
twelve (12) months of assistance
If an applicant enters an educational
program that leads to a certification or
degree from Regionally Accredited College,
University or online degree programs
If the applicant lives in a distressed county,
an additional six (6) months will be added
(not to exceed the maximum assistance.
MAXIMUM ASSISTANCE
Applicants are eligible for up to
$50,000.00 of arrearage assistance
which must include a minimum of twelve
(12) months of mortgage payments.
A cap of $50,000.00 is the maximum
amount permitted for the mortgage
assistance regardless if the education
option is included or not.
TERMS OF ASSISTANCE
Non recourse 0% interest, non-amortizing,
forgivable loan secured by a subordinate
lien on the subject property.
Forgiven over a five (5) year period at a
rate of 20% per year.
If the property is sold or refinanced prior
to the loan termination date, funds will be
recovered should sufficient equity be
available from the transaction.
ELIGIBLE APPLICANTS
UNEMPLOYED: One or more applicants must
be receiving unemployment, be eligible to
receive or must have exhausted unemployment
compensation benefits.
UNDEREMPLOYED: Applicant that can show a
reduction in income by 15% or more since the
hardship event.
REINSTATEMENT ONLY: Applicants who
have fallen behind but are now re-employed and
can now sustain the mortgage.
ELIGIBLE APPLICANTS
REINSTATEMENT ONLY:
Applicants must show that they experienced
a hardship with either a 15% reduction in
income or a job loss.
If the hardship was a job loss the applicant
must have been eligible for unemployment
benefits.
Mortgage debt to income ratio must be 35%
or below. Applicants that are eligible for
the option may not participate in any other
options.
ELIGIBLE APPLICANTS
Military Deployment – Members of the
U.S. Armed Forces who have
experienced ANY drop in income due to
deployment will now be eligible for the
Home Saver Program.
This applies to all personnel in regular and
reserve components of the Army, Navy, Air
Force, Marines & Coast Guard.
INELIGIBLE APPLICANTS
Active Bankruptcy.
Disabled & permanently unable for
full-time employment.
Loss of employment or reduction in
income due to medical reasons.
Part-time employment (unless
eligible for unemployment)
INELIGIBLE APPLICANTS
Temporary/Seasonal employment.
Permanent/intermittent work is seasonal
and does not apply (ex: farm workers)
Contract work is not considered
permanent work and does not apply.
Death of spouse, catastrophic medical
expenses and/or divorce.
INELIGIBLE APPLICANTS
Self-inflicted financial hardship
Poor debt management
Stripping the equity from their home for
non-essential purpose
Mismanagement of their personal budget.
Home has already been foreclosed on.
Already received home saver assistance.
An applicant can only apply for HHF assistance
one time.
INELIGIBLE APPLICANTS
Teachers or other employees cannot
claim a hardship due to a decrease in
income from a nine-month pay cycle.
Rental income will be regarded as
investment income and cannot be used to
calculate a hardship based on loss of
income.
ELIGIBLE EXISTING
MORTGAGES
Fixed rate
Fixed term
Balloon term
ARM
Fully amortizing
Unpaid principal loan balance cannot exceed
$271,000.00
Home equity line of credit – closed to future
advances
INELIGIBLE EXISTING
MORTGAGES
Second Mortgage Loans
Chattel Mortgages without Deed of
Trust
Interest Only Loans
Negative Amortizing Loan
Open End Mortgage/Future Advance
Clause
Loan Held by non-participating servicer
INELIGIBLE EXISTING
MORTGAGES
Seller Financed
Contract for Deed
Lease with Option to Purchase
Home Equity Line of Credit – Open to
future advances
Construction to Perm Loan – not
modified to permanent financing
Second Homes or Investment Properties
PROPERTY TYPES
Single Family (attached or detached)
Condominium Unit
1 – 5 unit properties where the applicant
is living in one of the units
PROPERTY TYPES
Manufactured Home on a foundation
permanently affixed or real estate
owned by the borrower.
Title to manufactured home must be
surrendered and the manufactured
home must be taxed as real property
(must supply documentation to
support mobile home is taxed as real
property) Must have a Deed of Trust
MINIMUM ELIGIBILITY
CRITERIA
Applicant must have a monthly mortgage
payment that they cannot afford due to
unemployment or at least a 15% reduction in
income.
The unpaid principal balance of first
mortgage cannot exceed $271,000.00.
Job loss had to occur on or after January 1,
2008.
MINIMUM ELIGIBILITY
CRITERIA
Mortgage must have been made prior to the
hardship event.
Unemployed applicants must be eligible to
receive, currently receiving or have exhausted
unemployment benefits.
Self employed applicants must be able to
document a 15% reduction in income with
minimum two (2) years tax returns.
MINIMUM ELIGIBILITY
CRITERIA
Self employed applicants must have been
self employed for a minimum of two (2)
years.
All documentation must be current and
within 60 days of approval.
Servicer must be a participating servicer or
be willing to sign up as a new participating
servicer.
MINIMUM ELIGIBILITY
CRITERIA
Applicant must be a resident of the State
of Mississippi.
Applicant must owner occupy the home as
their primary residence.
The applicant with the hardship must be on
at least one of the following:
1) Note
2) Deed of Trust
3) Warranty Deed
4) Quit Claim Deed
REQUIRED
DOCUMENTATION
REQUIRED
DOCUMENTATION:
UNEMPLOYED
Copy of most recent Utility Bill
Copy of DL or Photo ID (all parties
involved)
Copy of SS Card (all parties involved)
Copy of Unemployment Benefit Letter,
(applicant may supply)
However, underwriter will pull from the MDES
website on each file.
REQUIRED
DOCUMENTATION FOR
UNEMPLOYED
Copy of most recent Mortgage Statement
(if the name of the applicant is not on the
mortgage statement, you must provide one of
the following additional mortgage documents
which does include the applicant’s signature)
1) Note
2) Deed of Trust
3) Warranty Deed
4) Quit Claim Deed
REQUIRED DOCUMENTATION:
UNDEREMPLOYED &
REINSTATEMENT ONLY
Current Mortgage Loan Statement
Copy of Original Signed Note
Copy of Original Signed Deed of Trust
Most Recent Pay Stubs (if employed)
Most Recent Two (2) Years W2’s or
1099’s
Most Recent Two (2) Years Federal Tax
Returns
REQUIRED DOCUMENTATION:
UNDEREMPLOYED &
REINSTATEMENT ONLY
Self Employed – Two (2) years most recent
Business and Personal Federal Tax Returns
(all schedules)
Self Employed – YTD Profit & Loss
Statement (signed by preparer)
Self Employed – Most recent Two (2) months
Business and Personal Bank Statements
REQUIRED DOCUMENTATION:
UNDEREMPLOYED &
REINSTATEMENT ONLY
Current SSI Awards Letter (if applicable)
Copy of DL or Photo ID (all parties involved)
Copy of Social Security Card (all parties
involved)
VOE’s
Current Employment
Previous Employment
ADDITIONAL
DOCUMENTATION THAT
MAY BE REQUIRED
Divorce Decree or Court Ordered
Document
Quit Claim Deed (Divorce or Separation)
Doctors Release authorizing full-time
employment (Disability)
Additional Tax Returns prior to most
recent 2 years (Hardship)
Bankruptcy Discharge Papers
SOURCES OF INCOME NOT
CONSIDERED IN
DETERMINING ELIGIBILITY
Foster Care
Veteran’s Administration
Family
Educational Benefits
Contributions
Food Stamps
Medicaid
Child Support
Social Security/Disability
Benefits
Retirement Income
MISCELLANEOUS
Bankruptcy:
Bankruptcy Must be Discharged or Dismissed.
Income Limits:
Does not apply.
Maximum Delinquency:
MHC will allow up to 6 months prior to
hardship (included within the $50,000.00
maximum assistance) to cover payments that
precede the hardship event date.
COMPLIANCE
COMPLIANCE
Quarterly Reporting
Pipeline Management
Site Visits/Audits
Quarterly Reporting
Mortgage Payment Assistance
(MPA)
Mortgage Payment Assistance
Continuing Education Option
(MPACE)
Quarterly Reporting
Documentation
MHC monitors every 90 days for continued
eligibility
Documentation required to determine
continued eligibility:
Copy of most recent Pay Stub
Hire date required if re-employed
Self Employed - Quarterly Profit and Loss
statement
Current years tax returns & W2’s (if you have not
already provided them) or statement if you did not
file
MDES statement, if unemployed
Copy of most recent utility bill
Quarterly Reporting
Documentation
ELIGIBILITY RECERTIFICATION: The
individual who experienced the hardship that
qualified the household for Home Saver
assistance must complete the following:
Verify primary residence
Verify the homeowner is unemployed and am
available for work
If employed, verify they have obtained
employment
(must provide recent paystub).
Education Option
In order to maintain eligibility under the
Education Option the homeowner who
experienced the hardship must submit
required documentation that reflect academic
progress.
The Academic Plan and supporting
documentation must be received within 90
days after the date of your first payment.
Within 180 days after the date of your first
payment, a signed verification of enrollment
from your school’s registrar’s office must be
submitted to MHC.
Education Option
The Homeowner who experienced the hardship
must take a minimum of 12 hours for a full-time
student or 6 hours for a graduate student
Upon the completion of each semester, an
official transcript must be submitted to MHC
from the school’s registrar’s office reporting the
progress of the most recent semester
completed.
If we do not receive these completed documents,
the homeowner is at risk losing the additional 12
months of assistance.
Education Option
Documentation
Required documents for education option:
Signed Academic Plan cover page and the
completed written plan with course description
Official Verification of enrollment from your
school signed by the registrar’s office
Official Transcript from School showing grades
from most recent semester completed
Must be requested and sent from registrar’s office to
us directly.
Cannot be a copy
WHAT DOES REGIONAL
ACCREDITATION MEAN?
Regionally accredited institution of higher education
means a community college, college, or university
which is a candidate for accreditation or is accredited
by one of the following regional accrediting bodies:
Middle States, Association of Colleges and Schools
New England Association of Schools and Colleges
North Central Association of Colleges and Schools
Northwest Commission on Colleges and Universities
Southern Association of Colleges and Schools
Western Association of Schools and Colleges;
Accrediting Commission for Community and Junior
Colleges
Quarterly Reporting
Assistance
Please encourage clients to seek
assistance in completing the Quarterly
Report if needed.
If you assist the client in completing the
Quarterly Report, make sure that all
required documentation is included and
the report is signed.
AT RISK
If applicant is not compliant by the due date of
the quarterly review MHC will send out an At
Risk letter to applicant about possible loss of
assistance.
The applicant will have ten days to respond and
submit all missing supporting documentation.
Documentation not received, the client’s
assistance will be terminated due to noncompliance
Program Removal
Transition: completed the terms of their
Home Saver assistance and will be
responsible for their next mortgage
payment.
Income ineligibility – No longer considered
under employed or their mortgage is
deemed sustainable
Failure to submit required documentation
Fraud
Pipeline Management
Assign client files
Follow up with clients
Check failed applications
Remove Duplicates
Change status
Notes
Site Visits & Audits
Site visits are available for technical assistance &
training
Agency Audits
A letter will be sent to the agency with the audit date
Audits will can take up to 2 days to complete depending
on location and size of potential audit
Compliance & Single Family reps will be present for the
audit
Staff will review files based on pre-selected applicant
listing generated from Counselor Direct
Research on applicant lists will be done prior to site visit
to determine if the applicant file would be an eligible file
ex: applicant is still under step 1 and is not considered an
actual file or it is a duplicate file
Audit findings should be completed within 30 business
days from the date of audit completion.
Agency Audits
Staff will review files based on pre-selected
applicant listing generated from Counselor Direct
Research on applicant lists will be done prior to
site visit to determine if the applicant file would
be an eligible file
ex: applicant is still under step 1 and is not
considered an actual file or it is a duplicate
file
Audit findings should be completed within 30
business days from the date of audit completion.
Pipeline restrictions may occur
Any Questions?
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Mastering of Underwriting - Mississippi Home Corporation