Renovation Loan Options e-book - Dennis Hearing

Renovation Mortgage Products

About Caliber Home Loans Caliber Home Loans, Inc. is a dedicated national

mortgage lender. Our expanding inventory of loans include conforming, Jumbo, and government products. We also offer our own non-Agency products.

Our core strengths include our innovative mortgage solutions, customer-centric corporate culture, and a management team with decades of industry experience. These strengths enable us to provide superior service to real estate professionals and their clients.

As your local Caliber Home Loans representative, I’m committed to providing personal, expert guidance to your clients throughout the entire home financing process.

Caliber Home Loans, Inc., 3701 Regent Boulevard, Irving, TX 75063 (NMLS #15622). 1-800-401-6587. Copyright ©2016. All Rights Reserved. Equal Housing Lender.

For real estate and lending professionals only and not for distribution to consumers. This communication may contain information that is privileged, confidential, legally privileged, and/or exempt from disclosure under applicable law. Distribution to the general public is prohibited.

Product Overview Caliber Home Loans offers a selection of loan products designed specifically for homes in need of renovation.

They include: FHA 203(k) Rehab Caliber offers two FHA 203(k) products:

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Standard “Full” 203(k) – Provides financing for major projects, including structural repairs.

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Streamline “Limited” 203(k) – Provides financing for minor remodeling and non-structural repairs, such as kitchen or bathroom updates for modernization.

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Unlike the Standard 203(k), a HUD consultant isn’t required but may be used to meet inspection requirements.

Caliber Home Loans, Inc., 3701 Regent Boulevard, Irving, TX 75063 (NMLS #15622). 1-800-401-6587. Copyright ©2016. All Rights Reserved. Equal Housing Lender.

For real estate and lending professionals only and not for distribution to consumers. This communication may contain information that is privileged, confidential, legally privileged, and/or exempt from disclosure under applicable law. Distribution to the general public is prohibited.

Product Overview Caliber Home Loans offers a selection of loan products designed specifically for homes in need of renovation. They include: HomeStyle® Renovation This Fannie Mae program is similar to the FHA 203(k) program, with additional benefits: Homebuyers may use their additional funds for non-essentials such as adding a swimming pool or financing a major landscaping project.

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Two levels of renovation/funding are available: Level II and Level III.

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Generally, homebuyers may qualify for more funds with HomeStyle Renovation.

Caliber Home Loans, Inc., 3701 Regent Boulevard, Irving, TX 75063 (NMLS #15622). 1-800-401-6587. Copyright ©2016. All Rights Reserved. Equal Housing Lender.

For real estate and lending professionals only and not for distribution to consumers. This communication may contain information that is privileged, confidential, legally privileged, and/or exempt from disclosure under applicable law. Distribution to the general public is prohibited.

Escrow Holdbacks for Minor Repairs Smaller amounts of funding can be provided with an escrow holdback. These are available for most types of loans, including GSE, government-insured, Jumbo and Portfolio Lending Suite products.

Weather-Related/General Escrows – This method can fund minor repairs such as external paint and landscaping. Funds are limited to 10% of the property’s value or $5,000 (VA loans may qualify for up to $6,000) Non-Agency Portfolio – This method is available for most Caliber Portfolio Suite loan products. It can fund minor repairs similar as those covered by general escrow funding. Funds are limited to 10% of the property’s value or $5,000.

Caliber Home Loans, Inc., 3701 Regent Boulevard, Irving, TX 75063 (NMLS #15622). 1-800-401-6587. Copyright ©2016. All Rights Reserved. Equal Housing Lender.

For real estate and lending professionals only and not for distribution to consumers. This communication may contain information that is privileged, confidential, legally privileged, and/or exempt from disclosure under applicable law. Distribution to the general public is prohibited.

Choosing the Right Renovation Loan The next slides will explain the pros and cons of all available renovation options.

This will help you understand which loan products are ideal for any “fixerupper” properties you’re selling.

One major benefit offered by all products is that they can help you close loans with sellers who prefer to lower a property’s sale price than to carry out improvements requested by potential buyers.

Caliber Home Loans, Inc., 3701 Regent Boulevard, Irving, TX 75063 (NMLS #15622). 1-800-401-6587. Copyright ©2016. All Rights Reserved. Equal Housing Lender.

For real estate and lending professionals only and not for distribution to consumers. This communication may contain information that is privileged, confidential, legally privileged, and/or exempt from disclosure under applicable law. Distribution to the general public is prohibited.

FHA 203(k) Rehabilitation Loan Since different properties require different levels of repairs, the 203(k) loan is offered in two levels: Standard and Streamline. The major differences in these two is that the Standard 203(k) is required for properties requiring structural repairs and for projects exceeding $35,000.

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Standard “Full” 203(k) – Provides financing for major projects, including structural repairs. A HUD consultant who specializes in preparing the documentation for 203(k) loans, and the contractors required to carry out the repairs, is required. A Full 203(k) offers more funding for repairs than a Streamline 203(k).

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Streamline “Limited” 203(k) – Provides financing for minor repairs, such as updating one or more rooms. Unlike the Full 203(k), a HUD consultant is not required but may be used to meet inspection requirements. The maximum additional funding for a Streamline 203(k) is $35,000.

Caliber Home Loans, Inc., 3701 Regent Boulevard, Irving, TX 75063 (NMLS #15622). 1-800-401-6587. Copyright ©2016. All Rights Reserved. Equal Housing Lender.

For real estate and lending professionals only and not for distribution to consumers. This communication may contain information that is privileged, confidential, legally privileged, and/or exempt from disclosure under applicable law. Distribution to the general public is prohibited.

203(k) Loan Basics The following features apply to both 203(k) Streamline and Full loan products:

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Available in 30-year fixed terms only

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High balance loans are available

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Energy-Efficient (EEM) improvements are allowed

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Owner-occupied properties only

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Properties must be at least one year old

Caliber Home Loans, Inc., 3701 Regent Boulevard, Irving, TX 75063 (NMLS #15622). 1-800-401-6587. Copyright ©2016. All Rights Reserved. Equal Housing Lender.

For real estate and lending professionals only and not for distribution to consumers. This communication may contain information that is privileged, confidential, legally privileged, and/or exempt from disclosure under applicable law. Distribution to the general public is prohibited.

HomeStyle Renovation Our HomeStyle® Renovation Mortgage helps you sell homes in need of repair, renovation, updates or enhancements. However, HomeStyle Renovation can be a better choice than the FHA 203(k) for buyers who prefer additional options.

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Higher amounts of renovation funds may be available. Additional financing available up to 75% of the property’s “post-renovation” appraised value.

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Buyers may use their funds to finance non-essential projects, such as a swimming pool or landscaping.

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Both fixed-rate and ARM loan terms are available.

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Buyers are not limited to owner-occupied properties. Second homes and investment properties may qualify.

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FHA mortgage insurance premiums are not required.

Caliber Home Loans, Inc., 3701 Regent Boulevard, Irving, TX 75063 (NMLS #15622). 1-800-401-6587. Copyright ©2016. All Rights Reserved. Equal Housing Lender.

For real estate and lending professionals only and not for distribution to consumers. This communication may contain information that is privileged, confidential, legally privileged, and/or exempt from disclosure under applicable law. Distribution to the general public is prohibited.

HomeStyle Renovation This table illustrates the main differences in these two loan programs. HomeStyle Renovation offers more flexibility in several areas, including eligible improvements and property types.

HomeStyle Renovation

FHA 203(k) Rehab

Eligible Property Types

Single family residences, PUDs, modular homes, 2-4 unit properties, new construction

Single family residences, PUDs, modular homes, 2-4 unit properties

Condos and coops?

No

No

Investment properties?

Yes

No

LTV Eligible improvements Mortgage Insurance (MI) Required

95-75%, varies depending on occupancy type and product (Fixed, ARM, High Balance).

No restrictions, improvements must be permanently affixed to the property Yes, if down payment is less than 20%

96.5% No luxury improvements, no tear down properties Yes

Caliber Home Loans, Inc., 3701 Regent Boulevard, Irving, TX 75063 (NMLS #15622). 1-800-401-6587. Copyright ©2016. All Rights Reserved. Equal Housing Lender.

For real estate and lending professionals only and not for distribution to consumers. This communication may contain information that is privileged, confidential, legally privileged, and/or exempt from disclosure under applicable law. Distribution to the general public is prohibited.

Work With a Renovation Specialist Since the FHA 203(k) and HomeStyle Renovation loans require additional planning and paperwork, only a limited number of Loan Consultants can offer these products to borrowers.

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Caliber Home Loans provides mandatory training sessions for every Loan Consultant who offers HomeStyle Renovation loans.

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In addition to completion of their training, each HomeStyle Loan Consultant must obtain formal approval from their Divisional Vice President before offering renovation products.

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Working with a trained Loan Consultant helps expedite your client’s negotiations with the licensed contractors and renovation consultants, making the entire process easier and less stressful.

Caliber Home Loans, Inc., 3701 Regent Boulevard, Irving, TX 75063 (NMLS #15622). 1-800-401-6587. Copyright ©2016. All Rights Reserved. Equal Housing Lender.

For real estate and lending professionals only and not for distribution to consumers. This communication may contain information that is privileged, confidential, legally privileged, and/or exempt from disclosure under applicable law. Distribution to the general public is prohibited.

More products. More choices. More advantages.

Providing our REALTOR® associates with a variety of home renovation financing products plays an important role in our mission to help you close more sales. Our core strengths include our innovative mortgage solutions, customer and sales-centric culture, proprietary H2Online loan origination system, and entrepreneurial senior management team. These strengths make Caliber unlike any other mortgage lender within the industry, and enable us to provide your clients with a superior service experience.

Contact me today to learn more.

Dennis Hearing NMLS ID 892525 Loan Consultant 954-648-4949 dennis.hearing@caliberhomeloans.com www.caliberhomeloans.com/dhearing

Caliber Home Loans, Inc., 3701 Regent Boulevard, Irving, TX 75063 (NMLS #15622). 1-800-401-6587. Copyright ©2016. All Rights Reserved. Equal Housing Lender.

For real estate and lending professionals only and not for distribution to consumers. This communication may contain information that is privileged, confidential, legally privileged, and/or exempt from disclosure under applicable law. Distribution to the general public is prohibited.