[PDF] [PDF] The Math Behind Loan Modification

[PDF] APPENDIX 10 – MORTGAGE INSURANCE PREMIUMS - HUD

Upfront Mortgage Insurance Premium (UFMIP) All mortgages: 175 basis points ( bps) (1 75 ) of the Base Loan Amount Exceptions: • Streamline Refinance and 

[PDF] The Math Behind Loan Modification

FHA loan modifications (including FHA-HAMP and mods with a “partial claim”) • “ In-house” monthly payment using a mortgage calculator or MS Excel formula

[PDF] Section 184 Indian Home Loan Guarantee Program - FDIC

HUD PROGRAMS Section 184 Indian Home Loan Guarantee Program Provides access to credit for American Indian and Alaska Native families,

[PDF] HUD Home Buying Guide

But whether you decide on a HUD Home or not, you can use this guide to take you step by step through 1,429 1,492 MORTGAGE PAYMENT CALCULATOR

[PDF] Qualifying for a Mortgage

Purchasing a home and taking out a mortgage may be the biggest investment loan This may mean waiting several months or even a year or two before you apply While the Federal Housing Administration (FHA) allows borrowers to put Use an online “Mortgage Calculator” to get a rough estimate of what you may be 

[PDF] Your home loan toolkit - govconsumerfinancefiles

with a mortgage, student loan, or other financial product or service? You can submit a Many principal and interest calculators are available online $ consumerfinance gov/find-a-housing-counselor or call HUD's interactive voice system at 

[PDF] First Time Home Buyer Guide - PNC

PNC Mortgage is a division of PNC Bank, National Association, a subsidiary of PNC HOME AFFOrDABILItY CALCULAtOr your loan * Subject to property underwriting and appraisal Borrower FHA loans for expanded eligibility

[PDF] Reverse Mortgage Loans - AARP

approved HECM counselors can be found at: https://entp hud gov/idapp/html/ on “Reverse Mortgage Calculator”) Mortgage Calculator”) estimates how

[PDF] Publication 936 - Internal Revenue Service

1 mar 2021 · ment of Housing and Urban Develop- ment (HUD) or a state 2 You meet the rules to deduct all of the mortgage interest on your loan and all of

[PDF] fiba 12s

[PDF] fibre optique reflexion totale

[PDF] fiche d'activité 4 bts muc

[PDF] fiche d'activité anglais cycle 3

[PDF] fiche d'activité animation 3 5 ans

[PDF] fiche d'activité baton de pluie

[PDF] fiche d'activité galette des rois

[PDF] fiche d'activité jeu de mime

[PDF] fiche d'activité jeux de société

[PDF] fiche d'activité les 5 sens

[PDF] fiche d'activité planète des alphas

[PDF] fiche d'activité sur les émotions

[PDF] fiche d'activités centre de loisirs

[PDF] fiche de cours sur le roman

[PDF] fiche de lecture ce1 a imprimer

TheMathBehind

LoanModification

AWebinarforHousingCounselors

andLoanModificationSpecialists

PresentedbyBillAllen

DeputyDirector,HomeCorps

Overview

•Typesofloanmodifications •Estimatingeligibilityatintake -estimatingDebtToIncomeratio(DTI) -estimatingLoanToValueratio(LTV) •Understandinganoffer -confirmingfullamortization

TypesofLoanModifications

•HAMP •HAMPTier2 contractualtermsoftheloan •Temporarymodification- interestratereturnstothecontractualrateaftertime •Forbearance- portionofpaymentisdeferredforatimeperiodbutisstillowed •Refinancing(including •2MP-forsecondliensonly

Review- simplifiedHAMP

modificationwaterfall •Determineatargetpayment - 31%DTI -Extendthematuritydatetoamaxof40years

TheIntakeInterview

(1)BreakdownoftheMonthlyMortgagePayment (2)EstimateofMonthlyGrossIncomebySource -Unemploymentbenefitsarenotcounted (3)EstimateofthePropertyValue

Example#1-TheSimpleFamily

(1)BreakdownoftheMonthlyMortgagePayment -$2115principalandinterest -$300propertytaxes -$75homeowner'sinsurance -$2490totalmonthlymortgagepayment (2)Grossincomebysource -Mr.Simple'sSSDI:$1200. -Grossmonthlyincome=$3800 (3)EstimatePropertyValue -Zillowshows:$225,000

EstimatingDTIandLTV

$1178Ͳ$300Ͳ$75=$803/mo.

CalculateLTVafterCapitalization

•LTV=Unpaid

Balance/PropertyValue

•$268,693/$225,000=1.19=119%LTV

EstimatetheMonthlyPaymentofthe

"BestͲCase"LoanModification -HAMPtier2:Principalreducedto115%LTV,30yr PMMSrate+0.05%(4.25%),40years

CalculatingaMonthlyPayment

MicrosoftExcel

Functionforcalculatingaloanpayment

=PMT(.02/12,40*12,Ͳ225000,0) $681.36

UsingaCalculator

M=P*(J/(1Ͳ(1+J)^ͲN)).

681.36

CompareResults

TheNetPresentValueTest

oftheNPVanalysisalongwithanydenial.

NPVFactors

Probability

WeightedValue

ofLoan

Modification

Probability

WeightedValueof

NonͲModification

Outcomes

=NPV

NoreͲdefaultͲ>Presentvalue

ofthenewmodifiedloan

ReͲdefaultͲ>lossfrom

escrowadvancesandloss fromforeclosure

Lossfrom

ForeclosureReinstatement

PositiveImpactonNPV

HigherCreditScore

DecreaseinPropertyValue

NegativeImpactonNPV

LowerCreditScore

IncreaseinPropertyValue

BorrowerEquity

PositiveImpactonNPV

Affordabilityofmodification

NegativeImpactonNPV

Likelihoodofreinstatingtheloan

NPVExample,FDICmodel

SimpleFamily

Ͳ=NPV

Lossfrom

ForeclosureReinstatement

60%

40%85%

15%

ReͲdefaultrateandreinstatementrate

arecreditorassumptionsspecificto thepropertylocationandborrower specificdatasuchascreditscore

NoreͲdefaultͲ>Presentvalue

ofthenewmodifiedloan

ReͲdefaultͲ>lossfrom

escrowadvancesandloss fromforeclosure (271,436)+206,324= (65,112) (255,449)+137,511= (117,938)

Presentvalueoffuture

cashflowof modificationpayments discountedbyFreddie

MacRate:5.4%

Unpaid

Principal

Balance

Presentvalueofanticipated

LossfromforeclosureafterreͲ

default

PresentvalueofREOpropertyless

foreclosurecostsandfuture escrowadvances $0

Modification

Ͳ$65,112

DefaultonMod.

Ͳ$117,938

(260,062)+144,041= (116,021)

Presentvalueof

lossfrom foreclosure

Presentvalueof

REOproperty

Foreclosure

Ͳ$116,021

0.60x(65,112)

+0.40x(117,938) ________________________ (86,242)

0.85x(116,021)

+0.15x0 ________________________ (98,618) $12,376

Positive

NPV

Notethateventhoughthebankislosing

moneybymodifyingtheloan,themodel showstheyarelikelytolosemoremoneyif theydonotmodifytheloan.

UnderstandinganOffer -

Amortization

•Amortization

-Onewaytoconfirmthis,istocalculatethefullyamortizedpaymentbyusingtheinterestbearingprincipal astheloan

UnderstandinganOffer -

AmortizationExample

UsingaCalculator

M=P*(J/(1Ͳ(1+J)^ͲN))

ExampleModificationOffer:

3.0%fixedinterest

30years

M=P*(J/(1Ͳ(1+J)^ͲN))

M=225000*((0.03/12)/(

1-(1+(0.03/12))^(Ͳ1*(30*12)))

M=$948.61

$43,693ofprincipalforbearance.

Example#2ͲIntake

(1)BreakdownoftheMonthlyMortgagePayment -$2015principalandinterest -$280propertytaxes -$85homeowner'sinsurance -$2380totalmonthlymortgagepayment (2)Grossincomebysource -Borrower#1paystub:$4200/mo.grossincome. -Grossmonthlyincome=$8075/mo. (3)EstimatePropertyValue -Zillowshows:$375,000

Example#2ͲAnalysis

theirDTIisalreadybelowthetargetpayment -However,giventheuncertaintywithhow theunderwritermighttreattheborrower's underbothtiers1andtier2ofHAMP.

CalculateLTVafterCapitalization

=PMT(.0425/12,40*12,Ͳ413000,0)

Example#2ͲResults

•Paymentreduction: (PriorPayment- ModifiedPayment)/PriorPayment (2380- 1790)/2380=0.25=25%paymentreduction •DTIrange:

10%DTI=0.10x$8075=$807.50

55%DTI=0.55x$8075=$4441.25

$1790P&I+$280taxes+$80insurance=$2150

Questions

quotesdbs_dbs4.pdfusesText_8