Test Your Knowledge on Loan Programs and Eligibility Requirements with this Quiz...

Loan Program and Eligibility Requirements Summary

• Loan programs include 30-year fixed rate, 10-year interest-only, 5/6 adjustable-rate mortgages (fully amortized or interest-only), and 7/6 adjustable-rate mortgages (fully amortized or interest-only).

• Eligible borrowers include individuals, limited liability companies, corporations, limited liability partnerships, foreign nationals, and revocable trusts.

• Ineligible borrowers include those with diplomatic immunity, those on exclusionary lists, irrevocable trusts, land trusts, blind trusts, and not-for-profit entities.

• Minimum loan size is $100,000 and maximum loan size is $2,000,000.

• Debt service coverage ratio (DSCR) requirements vary based on loan type and credit score.

• Loan-to-value (LTV) and combined loan-to-value (CLTV) ratios vary based on credit score, loan purpose, and property occupancy.

• Gross rents are used in DSCR calculations and must be verified through fully executed lease agreements or market rents from Fannie Mae Form 1007 or Form 1025.

• Eligible properties include single-family detached or attached homes, 2-4 unit residential properties, condominiums, planned unit developments, and 5-8 unit residential properties.

• Ineligible properties include vacant land, properties not accessible by local roads, properties unsuitable for year-round occupancy, agricultural properties, and properties used for marijuana cultivation or distribution.

• Liquidity requirements include 1% of unpaid principal balance on all mortgages, nine months of subject property loan monthly PITIA, and 12 months of PITIA for foreign nationals or DSCR < 1.0.

• Qualifying assets include bank statements, stocks/bonds/mutual funds, vested retirement accounts, and cash value of life insurance.

• Prepayment penalties are required for investment properties and declining prepayment penalty structures are allowed in Mississippi.Real Estate and Mortgage Terminology

• First-time home buyers are individuals who have not owned a principal residence in the past three years.

• A lease is a written agreement between a property owner and a tenant that outlines the conditions of renting the property for a set period of time.

• The loan-to-value (LTV) ratio is the original loan amount of the first mortgage divided by the property's appraised value or sales price.

• A prepayment penalty is a fee charged for paying off part or all of the principal of a loan before the due date.

• A sales contract is a written agreement between parties for the purchase, sale, exchange, or conveyance of a property.

• Debt service coverage ratio (DSCR) is the monthly gross income divided by the principal, interest, taxes, insurance, and other expenses (PITIA) of a property.

• Loanguys.com charges various fees based on loan amount and type, including a processing fee, underwriting fee, document preparation fee, and credit report fee.

• A displaced homemaker or single parent can qualify as a first-time home buyer if they have not owned a principal residence in the past three years (excluding joint ownership with a spouse).

• PITIA includes the principal, interest, taxes, insurance, and other expenses associated with owning a property.

• Sales contracts must include the full names of the buyer(s) and seller(s), property address or legal description, sales price, and signatures of the parties.

• The debt service coverage ratio is calculated by dividing the estimated monthly market rent by the monthly PITIA of the subject property.

• Loanguys.com charges 2% of the total loan amount for commercial loans and 2.75% for fix and flip/bridge loans, with varying fees based on loan amount.