What is a MyCommunity Mortgage?
The MyCommunity Mortgage® is a Fannie Mae 3% down payment affordable lending program that gives borrowers access to flexible underwriting guidelines and reduced private mortgage insurance (PMI) coverage for moderate income home buyers in California.
MyCommunity has some suttle differencs in qualifying criteria between the 3% down (97% LTV) option or the 5% down (95% LTV) option. MCM fact sheet.
MyCommunity Guidelines & Highlights
- 30 year fixed
- Primary Residence only – Purchase or Refinance
- Max loan amount of $417,000
- 640 Minimum Credit Scores (or what DU approves)
- FTHB education class is required
- Max 97% LTV for qualified first time home buyers
- Purchase only
- 97% LTV requires at least one borrower be a FTHB’r
- Max CLTV of 105% with a Community 2nd mtg.
- Max 95% LTV for non-first time home buyers
- Cannot own other property
- Purchase or R&T refinance
- Maximum DTI ratios 45% or whatever DU allows
- No minimum borrower contribution
- Gift funds allowed (from family, employer, Community 2nd’s)
- Non-occupied co-borrowers not allowed
- Borrower income cannot exceed 140% of the AMI in California (see below)
- Up to 49% of qualifying income can come from an occupying co-borrower who has insufficient credit history
· Allows 30% of qualifying income to come from border income? (No other loan program allows this)
· Allows borrowers to use **cash-on-hand aka ‘mattress money’ and/or ‘sweat equity’ for the down payment?
You can read the MCM matrix here and see comparison between the Conventional 97% and MCM.
MyCommunity Income Limits
Southern California County Income Limits
- Riverside County – $84,980
- San Bernardino County – $84,980
- Orange County – $91,980
- San Diego County – $101,780
- Los Angeles County – $91,980
- Ventura County – $124,180
- San Louis Obispo – $107,800
- Kern County – $72,380
- Contact us for other counties.
==> All household income (borrower/non-borrower) is considered when calculating AMI limits.
MyCommunity VS. FHA
Seven reasons why the MyCommunity Mortgage can be a better option than FHA or traditional financing:
1. The MCM PMI is often less than FHA’s MIP
2. MCM doesn’t require up front mortgage insurance
3. MCM doesn’t require a Condo approval like FHA requires
4. The PMI on a MCM can be removed when reaching 80% LTV…FHA’s MIP is permanent
5. MCM allows border income to be used for qualifing
6. MCM allows **Unsourced cash to be used for the down payment
7. MYM allows co-borrowers with little to no credit history to count their income for qualifying!
$0 Down Payment Needed when Combined with CHDAP
The MyCommunity Mortgage loan program allows the CalHFA CHDAP 3% down payment/closing cost assistance program to be combined with it to satisfy the 3% down