Following are a few examples of different scenarios to show how to calculate this fee correctly.

Example #1
Purchase Price $250,000
Appraised Value $258,000
Borrowers want to finance $8,000 in closing costs in the loan since the appraisal is higher than the purchase price. In addition, they will finance USDA’s guarantee fee.
Loan Amount $258,000 divided by .98 = total loan amount of $263,265.31
Subtract total loan amount $263,265.31 from loan amount $258,000 = $5,265.31 USDA Guarantee Fee
Total Loan Amount $263,265.31 X 2.00% = $5,265.31 USDA Guarantee Fee

Example #2
Purchase Price $300,000
Appraised Value $300,000
There is no room to finance closing costs; however, the borrowers would like to finance the USDA guarantee fee.
Loan Amount $300,000 divided by .98 = Total loan amount of $306,122.45
Subtract total loan amount $306,122.45 from loan amount $300,000 = $6,122.45 USDA Guarantee fee
Total loan amount $306,122.45 X 2.00% = $6,122.45 USDA Guarantee Fee

Example #3
Purchase Price $175,000
Appraised Value $190,000
There is a $15,000 difference between the appraisal and the purchase price, however, the borrowers only want to finance $10,305 in closing costs plus the USDA fee.
Purchase Price $175,000 + $10,305 closing costs = Loan Amount $185,305
Loan Amount $185,305 divided by .98 = total loan amount $189,086.73
Subtract total loan amount $189,086.73 from loan amount $185,305 = $3,781.73
Total Loan Amount $189,086.73 X 2.0% = $3,781.73

In case you missed this call Jennifer DeVenne shared the PowerPoint with me so I could share it with everyone else. Thanks Jennifer.

FHA Call on 3-11-2012 Click here

FHA Collections Click here

Above are the 2 major pieces of the call. The big hottest topic was the MI factors going up and the collection guidelines.

The easiest way to remember the collection guideline is the only way a collection can be left open is if it is both 2 years old and under $1,000. If all collections including medical total over 1k then all must be paid to 0 if collections are less than 1k but less than 2 years old then they must be paid.

Notes for HARP 2 loans

All HARP loans other than Flagstar must be done as a Broker unless the LTV is at 100% or less.

Wells will only do Wells to Wells deals

Hi All:

I’m new to Integrity so I thought I would reach out to all to ask if you’ve had success in any way when your working with a Borrower that has an underwater mortgage with MI. I guess no HARP since it’s not secured by Fannie or Freddie.  Any suggestions on how to get it done?  Has anyone ever tried working through the MI Company?

Tim

Did you get your License renewed by 12/31/2011? If not, please contact Mark Spense at the Corporate Office as soon as possible.