MANUFACTURED HOUSING. TIB is excited to announce that we are now accepting CONVENTIONAL CONFORMING MANUFACTURED HOUSING Loans

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1 TIB The Independent BankersBank, N.A. January 4, 2019 MANUFACTURED HOUSING TIB is excited t annunce that we are nw accepting CONVENTIONAL CONFORMING MANUFACTURED HOUSING Lans Please see attached Matrix If yu have questins please cntact yur assigned TIB Accunt Executive (AE):

2 Husing Overview CONVENTIONAL CONFORMING MANUFACTURED HOUSING MATRIX Maximum Lan Amunt $484,350 Terms Available Any dwelling unit built n a permanent chassis and attached t a permanent fundatin system is a manufactured hme fr purpses f TIB guidelines. This includes prperties meeting the MH Advantage The manufactured hme and the land n which it is situated must be titled as real prperty. Other factry-built husing (nt built n a permanent chassis) such as mdular, prefabricated, panelized, r sectinal husing is nt cnsidered manufactured husing under these guidelines. 30, 20, 15, 10 years Prgrams Available Fixed rate Mrtgage Maximum LTV, CLTV, Occupancy Purchases, Limited Cash/Out and cash/out Standard Eligibility Occupancy # Units Purchased Maximum LTV/CLTV LCOR Maximum LTV/CLTV Cash/Out Maximum LTV/CLTV Principal Residence 1 Unit 95/95/95% 95/95/95% 80/80/80% Secnd Hme 1 Unit 90/90/90% 90/90/90% 75/75/75% Investment 1 Unit 85/85/85% 75/75/75% 75/75/75% N Interest nly Allwed Subrdinate Financing Refer t FNMA Guide if yu are ffering a simultaneus 2 nd, Or if seasned current lan less than 6 mnths cntinuity f bligatin rules apply n cash ut O/O and 2 nd hmes. Cnventinal Cnfrming Husing Prduct Page 1 f 10

3 Cnventinal Mini Crrespndent Lans will be Credit Underwritten withut the fllwing dcuments; Appraisal Title Survey Tax Certificate Dcuments t be submitted prir t a clear t clse (CTC); Appraisal Title Survey Tax Certificate Mini Crr. Des nt qualify fr 1 st Tuch Appraisal Per DU/LP findings reprt Underwriting Factrs General Lan Eligibility Criteria TIB purchases mrtgage lans secured by manufactured hmes that meet the fllwing general criteria: first-lien mrtgages nly, fully amrtizing fixed-rate mrtgages r principal residences and secnd hme dwellings. Ineligible Criteria The fllwing are ineligible fr mrtgage lans secured by manufactured hmes: temprary buydwns; investment prperties; single-width manufactured hmes; hmes lcated n leasehld estates trade equity Underwriting Mrtgages secured by manufactured hmes (including MH Advantage prperties) must be underwritten thrugh DU. Husing Standards Sales Price and Original Lan Amunt When entering the prperty infrmatin int DU, the lender must crrectly identify the prperty type as either: Hme, Hme: MH Advantage. The mrtgage lan must be secured by bth the manufactured hme and the land n which it is situated, and bth the manufactured hme and the land must be legally classified as real prperty under applicable state law. The purchase, cnveyance, and financing (r refinancing) f the land and the manufactured hme must be evidenced and secured by a single valid and enfrceable nte and first lien mrtgage, deed f trust r security deed that is recrded in the land recrds, in states where applicable state law clearly prvides fr such a single lien. Any persnal prperty items (nn-realty items) purchased in cnjunctin with the manufactured hme must be deducted frm the sales price and cannt be financed as part f the mrtgage. In additin t the cst f the manufactured hme and land, if applicable, the riginal lan amunt and r sales price may als include: the financing f brrwer-purchased mrtgage insurance premiums; the cst f bna fide and dcumented transprtatin, site preparatin, and dwelling installatin at the site. Financing f ther csts is nt permitted fr purchase mney mrtgages, but is permitted fr limited cash-ut refinance transactins Cnventinal Cnfrming Husing Prduct Page 2 f 10

4 Dwn Payment A minimum dwn payment f 5% must cme frm the brrwer s wn funds unless: the LTV r CLTV rati is less than r equal t 80%; the brrwer is purchasing a ne-unit principal residence and meets the requirements t use gifts, dnated grant funds, r funds received frm an emplyer t pay fr sme r all f the brrwer's minimum cntributin. Or the prperty meets the MH Advantage requirements and the lan meets the requirements fr LTV ratis f %. In this case, the brrwer must cntribute a minimum dwn payment f 3%, frm his r her wn funds unless the lan meets the gift, grant, r funds frm an emplyer The brrwer's equity in the land is cnsidered the brrwer s wn funds. Where the brrwer hlds title t the land n which the manufactured hme will be permanently attached, the value f the land may be credited tward the brrwer s minimum dwn payment requirement. The brrwer s equity cntributin will be the difference between any utstanding liens against the land and the market value f the land. The fllwing table describes hw t determine the value f the land based n when and hw the brrwer acquired the land. Date f Land Purchase Value f the Land Dcumentatin Mre than 12 mnths preceding the lan applicatin. The current appraised value. Nne. 12 r fewer mnths preceding the date f the lan applicatin. The lesser f the sales price r the current appraised value. The lender must dcument the brrwer s cash investment by btaining: a cpy f the settlement statement, a cpy f the warranty deed that shws there are n utstanding liens against the prperty, r a cpy f the release f any prir liens(s). Purchase Mney Transactins The brrwer acquired the land at any time as a gift, inheritance, r ther nn-purchase transactin. The current appraised value. The lender must btain apprpriate dcumentatin t verify the acquisitin and transfer f wnership f the land. Purchase mney transactins are thse in which the mrtgage prceeds are used t finance the purchase f the manufactured hme r the manufactured hme and the land. The land may be previusly wned by the brrwer, either free f any mrtgage r subject t a mrtgage that will be paid ff with the prceeds f the new purchase mney mrtgage. Nte: The brrwer des nt receive any cash back with a purchase mney transactin. Cnventinal Cnfrming Husing Prduct Page 3 f 10

5 Purchase Mney Transactins cntinued New Hmes The LTV rati (and CLTV/HCLTV rati, if applicable) fr a lan secured by a newly built manufactured hme that is being attached t a permanent fundatin system in cnnectin with a purchase transactin will be based n the lwer f: the sales price f the manufactured hme plus: Limited Cash- Out Refinance Transactins the lwest sales price at which the land was sld during that 12 mnth perid if the land was purchased in the 12 mnths preceding the lan applicatin date; r the current appraised value f the land if the land was purchased mre than 12 mnths preceding the lan applicatin date. the as cmpleted appraised value f the manufactured hme and land. Existing Hmes The LTV rati (and CLTV/HCLTV rati, if applicable) fr a lan secured by a manufactured hme that already exists n its fundatin will be based n the lwest f: the sales price f the manufactured hme and land; the current appraised value f the manufactured hme and land; r if the manufactured hme was built in the 12 mnths preceding the lan applicatin date, the lwest price at which the hme was previusly sld during that 12-mnth perid, plus the lwer f: the current appraised value f the land, r the lwest price at which the land was sld during that 12 mnth perid (if there was such a sale). Limited cash-ut refinance transactins invlve the payff f an existing mrtgage secured by the manufactured hme and land (r existing liens if the hme and land were encumbered by separate liens). The maximum LTV rati (and CLTV rati, if applicable) fr a limited cash-ut refinance transactin fr a lan secured by a manufactured hme and land will be based n the lwer f: the current appraised value f the manufactured hme and land; r if the manufactured hme was wned by the brrwer fr less than 12 mnths n the lan applicatin date and: if the hme and land are secured by separate liens, the lwest price at which the hme was previusly sld during that 12-mnth perid plus the lwer f the current appraised value f the land, r the lwest sales price at which the land was sld during that 12-mnth perid (if there was such a sale); if the hme and land are secured by a single lien, the lwest price at which the hme and land were previusly sld during that 12-mnth perid. Prceeds f a limited cash-ut refinance mrtgage may be used t: pay ff the utstanding principal balance f an existing first lien mrtgage secured by the manufactured hme and land (r existing liens if the hme and land were encumbered by separate first liens); pay ff the utstanding principal balance f an existing subrdinate mrtgage r lien secured by the manufactured hme and/r land, but nly if it was used t purchase the manufactured hme and/r land; finance clsing csts (including prepaid expenses); and prvide cash back t the brrwer in an amunt nt t exceed the lesser f 2% f the balance f the new refinance mrtgage r $2,000 (unless in state f Texas where -0- cash back is allwed) Cnventinal Cnfrming Husing Prduct Page 4 f 10

6 Cash-Out Refinance Transactins Clsing Instructins A cash-ut refinance: invlves the payff f an existing first lien mrtgage secured by the manufactured hme and land (r existing liens if the hme and land were encumbered by separate first liens); r enables the prperty wner t btain a mrtgage n a prperty that des nt already have a mrtgage lien against it, and permits the brrwer t take equity ut f the prperty in the frm f mrtgage prceeds that may be used fr any purpse. T be eligible fr a cash-ut refinance, the brrwer must have wned bth the manufactured hme and land fr at least 12 mnths preceding the date f the lan applicatin. The LTV rati (and CLTV/HCLTV rati, if applicable) fr a cash-ut refinance fr a lan secured by a manufactured hme and land will be based n the current appraised value f the manufactured hme and land. Clsing instructins must advise clsing agents t btain the required dcumentatin necessary t ensure that the manufactured hme is attached t a permanent fundatin system n the land, thus becming part f the real prperty. If a clsing agent is nt available t perfrm this actin, the lender can rely n the certificatin f cmpletin cmpleted by the appraiser. In additin, where state law prvides that a manufactured hme may be exempt frm certificate f title requirements (fr instance, where a hme is attached initially t a permanent fundatin system), such clsing instructins must instruct the clsing agent t ensure that the manufactured hme qualifies fr exemptin frm certificate f title requirements, including mnitring f prperty installatin prcedures and the related dcumentatin, and t prvide the lender with dcumentary evidence f that fr retentin in the lan file. Where state law allws fr the eliminatin f the certificate f title, the clsing instructins must instruct the clsing agent t perfrm all necessary prcedures t: assure that the certificate f title t the manufactured hme is prperly retired, and prvide the lender with dcumentary evidence fr retentin in the lan file. Additinally, lenders must btain an insured clsing prtectin letter fr each mrtgage lan that is secured by a manufactured hme, if available. If an insured clsing prtectin letter is nt available, then the lender must include a nte in the file dcumenting its unavailability. Certificate f Title The table belw prvides cnditinal requirements pertaining t the manufactured hme certificate f title. If Then state law permits the manufactured hme t becme real prperty when it is immediately affixed t the permanent fundatin system, withut issuance f a certificate f title, a certificate f title has been issued, but state law prvides fr r permits surrender f the certificate f title, the lender must if the transactin invlves the purchase f a new manufactured hme btain, and retain as part f the lan file, evidence that n certificate f title was issued. Fr example, if the lender btains the manufacturer s certificate f rigin, this wuld be evidence, in mst states, that n certificate f title culd have been issued. the lender must btain, and retain as part f the lan file, evidence that the certificate has been surrendered. Such evidence includes: the cnfirmatin required t be prvided by the authrity t which the certificate was surrendered, r Cnventinal Cnfrming Husing Prduct Page 5 f 10

7 Certificate f Title cntinued Title Issues and Lien Title Insurance Hme Prperty Eligibility a certificate f title has been issued, but state law des nt permit the manufactured hme t becme real prperty withut issuance f a certificate f title and des nt prvide fr surrender f the certificate f title, manufactured husing appraisal requirements. Cnventinal Cnfrming Husing Prduct Page 6 f 10 if n such cnfirmatin is btainable: a cpy f the dcuments submitted in cnnectin with the surrender, and evidence that such dcuments were delivered t the apprpriate authrity. The lender must adhere t the fllwing requirements: The lien must be indicated n the certificate f title. The certificate f title must be retained in the lan file. The lender must assure that n ther lien is indicated n the certificate f title. Ownership f the manufactured hme as shwn n the certificate f title and wnership f the land as shwn n the mrtgage, deed f trust, r security deed must be identical (that is, the same individuals must sign bth, each using the exact same name n bth dcuments). T be eligible fr purchase by Fannie Mae: A manufactured hme mrtgage lan must be secured by a perfected lien (r liens) n real prperty cnsisting f the manufactured hme and the land. The manufactured hme must be legally classified as real prperty under applicable state law, including relevant statutes, regulatins, and judicial decisins. The fllwing requirements are als applicable: The wner f the manufactured hme must wn the land n which the hme is situated. The manufactured hme must be attached t a permanent fundatin n the land and cmply with state and jurisdictinal requirements fr permanent affixatin. A mrtgage, deed f trust, r security deed must be recrded in the land recrds and must identify the encumbered prperty as including bth the hme and the land. If applicable state law s permits, any certificate f title t the manufactured hme must be surrendered t the apprpriate state gvernment authrity. If the certificate f title cannt be surrendered, the lender must indicate its lien n the certificate. TIB prefers that a lan n the manufactured hme and the land n which it is situated be secured by a single lien. Hwever, it is recgnized that sme state laws d nt prvide fr a single lien n bth the manufactured hme and the land. Therefre, a lan dcumented by a lien n the land evidenced by a mrtgage, deed f trust r security deed and by a real prperty lien n the manufactured hme evidenced n the certificate f title r ther dcument is acceptable. Nte: lans in which there is a chattel lien n the hme plus a real prperty lien n the land are unacceptable. The mrtgage must be cvered under a standard real prperty title insurance plicy that insures that the manufactured hme is part f the real prperty that secures the lan. American Land Title Assciatin (ALTA ) Endrsement 7, 7.1, r 7.2 r any ther endrsement required in the applicable jurisdictin fr manufactured hmes t be treated as real prperty must be included in the file. A manufactured hme as any dwelling unit built n a permanent chassis and attached t a permanent fundatin system., The table belw prvides additinal manufactured husing prperty eligibility requirements. Fr

8 Hme Prperty Eligibility cntinued The manufactured hme must be built in cmpliance with the Federal Hme Cnstructin and Safety Standards that were established June 15, 1976, as amended and in frce at the time the hme is manufactured; and additinal requirements that appear in HUD regulatins at 24 C.F.R. Part Cmpliance with these standards will be evidenced by the presence f bth a HUD Data Plate and the HUD Certificatin Label. If the riginal r alternative dcumentatin cannt be btained fr bth the Data Plate/Cmpliance Certificate and the HUD Certificatin Label, the lan is nt eligible fr delivery t Fannie Mae. The HUD Data Plate/Cmpliance Certificate is a paper dcument lcated n the interir f the subject prperty that cntains, amng ther things, the manufacturer s name and trade/mdel number. In additin t the data required by Fannie Mae, the Data Plate includes pertinent infrmatin abut the unit, including a list f factry-installed equipment. The HUD Certificatin Label, smetimes referred t as a HUD seal r tag, is a metal plate lcated n the exterir f each sectin f the hme. The Hme Appraisal Reprt (Frm 1004C) must shw evidence f bth the HUD Data Plate/Cmpliance Certificate and the HUD Certificatin Label. As an alternative t the riginal HUD Certificatin Label, the lender may be able t btain a verificatin letter with the same infrmatin cntained n the HUD Certificatin Label frm the Institute fr Building Technlgy and Safety (IBTS). A duplicate HUD Data Plate/Cmpliance Certificate may be available frm IBTS r by cntacting the In-Plant Primary Inspectin Agency (IPIA) r the manufacturer. (A list f IPIA ffices is psted n HUD s website.) The unit must nt have been previusly installed r ccupied at any ther site r lcatin, except frm the manufacturer r the dealer s lt as a new unit. The manufactured hme must be a ne-unit dwelling unit that is legally classified as real prperty. The twing hitch, wheels, and axles must be remved. The dwelling must assume the characteristics f site-built husing. The brrwer must wn the land n which the manufactured hme is situated in fee simple. Otherwise, mrtgages secured by manufactured hmes lcated n leasehld estates are nt eligible. The manufactured hme must be at least 12 feet wide and have a minimum f 600 square feet f grss living area. Except fr MH Advantage prperties, Fannie Mae des nt specify ther minimum requirements fr size, rf pitch, r any ther specific cnstructin details fr HUDcded manufactured hmes. Site preparatin fr delivery f the manufactured hme must be cmpleted. The manufactured hme must be attached t a permanent fundatin system in accrdance with the manufacturer s requirements fr anchring, supprt, stability, and maintenance. The fundatin system must be apprpriate fr the sil cnditins fr the site and meet lcal and state cdes. The manufactured hme must be permanently cnnected t a septic tank r sewage system, and t ther utilities in accrdance with lcal and state requirements. If the prperty is nt situated n a publicly dedicated and maintained street, then it must be situated n a street that is cmmunity wned and maintained, r privately wned and maintained. Cnventinal Cnfrming Husing Prduct Page 7 f 10

9 Hme Prperty Eligibility cntinued MH Advantage Prperty Eligibility There must be adequate vehicular access and there must be an adequate and legally enfrceable agreement fr vehicular access and maintenance. See B , Site Sectin f the Appraisal Reprt (06/05/2018), fr additinal infrmatin abut privately maintained streets. Mrtgages secured by existing manufactured hmes that have incmplete items, such as a partially cmpleted additin r renvatin, r defects r needed repairs that affect safety, sundness, r structural integrity, are nt eligible fr purchase until the necessary wrk is cmpleted. Exceptins t the freging may be made nly fr minr items that d nt affect the ability t btain an ccupancy permit such as landscaping, a driveway, r a walkway subject t all requirements and warranties fr new r prpsed cnstructin prvided in B , fr Pstpned Imprvements (02/27/2018). hmes that have an additin r have had a structural mdificatin are eligible under certain cnditins. If the state in which the prperty is lcated requires inspectin by a state agency t apprve mdificatins t the prperty, then the lender is required t cnfirm that the prperty has met the requirement. Hwever, if the state des nt have this requirement, then the structural mdificatin must be inspected and be deemed structurally sund by a third party wh is regulated by the state and is qualified t make the determinatin. In all cases, the satisfactry inspectin reprt must be retained in the mrtgage lan file. MH Advantage is manufactured husing that is built t meet cnstructin, architectural design, and energy efficiency standards that are mre cnsistent with site-built hmes. Examples f the physical characteristics fr MH Advantage include specific architectural and aesthetic features such as distinctive rf treatments (eaves and higher pitch rfline), lwer prfile fundatin, garages r carprts, prches, and drmers; cnstructin elements including durability features, such as durable siding materials; and energy efficiency standards (minimum energy ratings apply). Fannie Mae has agreements with manufacturers f hmes intended t qualify fr MH Advantage based n specific design criteria. The agreement allws the manufacturers t apply an MH Advantage Sticker t hmes that meet the design criteria. With the exceptin f the lender requirements utlined belw, lenders will nt be required t independently determine the prperty s eligibility fr MH Advantage. Lenders and appraisers respnsibilities relating t MH Advantage lans are detailed belw: Lender The lender must Cnventinal Cnfrming Husing Prduct Page 8 f 10 ensure the prperty meets the MH Advantage requirements by reviewing appraisal phts evidencing the presence f the MH Advantage Sticker (placed in prximity t the HUD Data Plate), HUD Data Plate, and HUD certificatin labels. verify thrugh appraisal r final inspectin phts the presence f a driveway leading t the hme (r t the garage r carprt, if ne is present). The driveway must cnsist f blacktp, pavers, bricks, cncrete, cement, r gravel, and;

10 MH Advantage Prperty Eligibility cntinued the presence f a sidewalk cnnecting either the driveway, r a detached garage r carprt, t a dr r attached prch f the hme. The sidewalk must cnsist f blacktp, pavers, flagstne, bricks, cncrete, r cement. Fr new cnstructin, the lender is respnsible fr cmpliance with standard appraisal requirements, specifically fr appraisals based n plans and specificatins. This will ensure site imprvements that are nt attached t the hme, such as detached garages, are cmplete. Appraisal The Hme Appraisal Reprt (1004C) r Appraisal Cmpletin Reprt (1004D) must include phts f the MH Advantage Sticker, HUD Data Plate, HUD Certificatin Labels, and the site shwing all driveways, sidewalks, and detached structures lcated n the site. Husing Appraiser Qualificatins Husing Appraisal and Standards Unless stated therwise, lans secured by manufactured hmes that meet the MH Advantage criteria are subject t the same requirements that apply t all manufactured hmes. (References t manufactured hmes r manufactured husing apply t MH Advantage unless an exceptin is stated.) Nte that lans secured by MH Advantage prperties are affrded a number f flexibilities ver standard manufactured husing, including higher LTV ratis, standard mrtgage insurance, and reduced lan-level price adjustments. The valuatin principles fr appraising manufactured hmes are essentially the same as fr ther types f residential prperty. Hwever, nt all appraisers are knwledgeable and experienced abut the unique cnstructin prcess, as well as the manufacturers and federal, state, and lcal requirements fr bth cnstructin and installatin. The lender must ensure that the appraiser is knwledgeable abut the lcal manufactured hme market and the unique cnstructin prcess fr manufactured hmes, and has access t apprpriate data surces in rder t render an pinin f value fr the manufactured hme. Lenders must establish plicies and prcedures t ensure that qualified individuals are being selected in accrdance with Fannie Mae requirements as well as the Appraiser Independence. The list belw prvides requirements and standards fr manufactured husing appraisals. Fr purchase mney mrtgages, the lender must prvide the appraiser with a cmplete cpy f the executed cntract fr sale f the manufactured hme and land; r a cmplete cpy f the executed cntract fr bth, if the manufactured hme and land are purchased separately; and a cpy f the manufacturer s invice if the manufactured hme is new. The appraiser must analyze the cntract(s) and the manufacturer s invice fr new manufactured hmes, and prvide a summary in the appraisal reprt. The appraiser must reprt the results f a manufactured hme appraisal n the Hme Appraisal Reprt (Frm 1004C). The use f Frm 1004C will help t ensure that the appraiser inspected, cnsidered, and reprted the apprpriate infrmatin including, but nt limited t, the: manufacturer s name, trade r mdel number, year f manufacture, Cnventinal Cnfrming Husing Prduct Page 9 f 10

11 Husing Appraisal and Standards cntinued serial number, Certificatin Label number(s) frm either the HUD Data Plate r Certificatin Label(s), type f fundatin and utility cnnectins, detailed and supprted cst apprach, pinin f the market value f the site, and prperty s cnfrmity t the neighbrhd. The appraiser must indicate a value cnclusin based slely n the real prperty as cmpleted cnsisting f the manufactured hme, site imprvements, and land n which the hme is situated. The value cnclusin cannt include any nn-realty items including, but nt limited t, insurance, warranties, and furniture. Newly Cnstructed Husing Appraisal Fr new manufactured hmes nt yet attached t the land r nt yet cnstructed, the appraisal may be based n either plans and specificatins r an existing mdel hme. If required infrmatin is nt available at the time the appraiser is cmpleting the appraisal frms, the appraiser must appraise the prperty subject t his r her receipt and review f the items and cmpletin f the imprvements as a cnditin f the appraisal. Infrmatin that may nt be available can include, but is nt limited t, the dealer invice, the HUD Data Plate, and the Certificatin Label numbers. A certificatin f cmpletin must be btained befre the mrtgage is delivered t Fannie Mae. The certificatin must be cmpleted by the riginal appraiser if pssible, r if nt pssible, by a substitute appraiser; verify and state that the imprvements were cmpleted and all ther requirements and cnditins f the appraisal have been satisfied; include previusly unavailable infrmatin, including a summary f the appraiser s analysis f any previusly unavailable dealer invice; and include phtgraphs f the cmpleted imprvements attached t the permanent fundatin. Nte: If the riginal r alternative dcumentatin cannt be btained fr bth the Data Plate/Cmpliance Certificate and the Certificatin Label, the lan is nt eligible fr delivery t Fannie Mae. Fr infrmatin regarding methds f alternative dcumentatin and eligibility cnsideratins, see B2-3-02, Special Prperty Eligibility and Underwriting Cnsideratins: Factry-Built Husing (10/02/2018). Cnventinal Cnfrming Husing Prduct Page 10 f 10