Effective September 2, 2015, Maryland is offering four special incentives (hence the name Grand Slam) for borrowers who are purchasing a home in Baltimore City. The Maryland Grand Slam Program in Baltimore City is open for reservations until the allocated funds for the grants are expended. The remaining balance of these funds will be posted daily in a flashing bulletin on Lender Online.
Incentives & Highlights are Listed Below:
First Base: the interest rate is 1/4% below the regular MMP interest rate for a conventional or government loan, whichever is applicable.
Second Base: $5,000 outright grant for down payment and closing costs from the state of Maryland.
Third Base: $2,500 outright grant for down payment and closing costs from Baltimore City.
Home Plate: $450 CDA Mortgage Credit Certificate (MCC) fee waived for an MMC associated with an MMP loan under the Maryland Grand Slam.
*Property must be in Baltimore City*
*Grants under the Maryland Grand Slam cannot be combined with matching funds from CDA Partner Match Programs*
*The entire city of Baltimore is a targeted area and therefore, someone buying a home in Baltimore City does not have to be a First-Time Homebuyer; however, they cannot own real property at the time of closing*
*The income limit for a one or two member household is $108,600 and $126,700 for a three or more member household*
*A CDA-approved lender must originate the loan*
*The maximum loan amount is $417,000*
If you have any questions contact me at 410-977-7176.
Deferred Student Loans:
The old guidelines said we did not have to count student loan debt if we could show the student loans deferred for 12 months. The new guidelines states they must be counted regardless of the deferment period. Lenders will be required to use the actual payment for qualification or if the payment is unknown, 2% of the outstanding balance of the loan to calculate the payment.
What does this mean for your buyers? They will qualify for LESS because we have to count more debt against them if they have student loan debt.
The old guidelines allowed charged off debt (debt that has been written off by the creditor) to be excluded without counting a payment against the buyer for it or requiring it to be paid prior to closing. The new guidelines will still allow for it not to paid but will require lenders to document why the charge-off exists, document reason for approving the loan, obtain a letter of explanation and supporting documentation behind the charge-off.
What does this mean for your buyers? Tougher underwriting guidelines that are not as forgiving and more documentation requirements for buyers with charge-off debt.
Frequent Job Changes:
The old guidelines allowed a buyer to change jobs multiple times as long as they were advancing in income or benefits. The new guidelines state that if a buyer changes jobs more than 3 times in the prior 12 months or has changed their line of work the lender has to provide transcripts of training and education demonstrating qualification for the new position or employment documentation evidencing continual increases in income and/or benefits.
What does this mean for your buyers? Tougher underwriting guidelines that require more documentation for someone who changes jobs frequently in the 12 months prior to a mortgage application.
Installment Debt Less Than 10 Months:
The old guidelines stated that an installment debt less than 10 months may be excluded from the buyer’s debt ratio. The new guidelines state that the debt may be excluded only if they have a cumulative payment of less than or equal to 5% of the borrower’s gross monthly income and the borrower may not pay down the debt to achieve this percentage.
What does this mean for your buyers? Buyers may potentially not qualify for as much if they have installment debt that is ten months or less.