Residential Mortgage & Home Improvement Loan Lending Criteria

CONSTRUCTION

MORTGAGE LOANS

Construction Mortgage Loans will be afforded to

applicants dealing through licensed and reliable

building contractors. In addition to regular

application requirements, the applicant or builder

must submit:

• Blueprints of the proposed construction

• Material Specification List

• Signed contract between the Applicant and

the Contractor

• Preliminary Sworn Statement

• Valid License

• Current Insurance

• References

Additional fees will be charged to cover increased

processing costs that are incurred on this type of

loan. The maximum amount of a construction loan

should not exceed 95% of the appraised property

value (subject to completion).

Since construction financing requires more

documentation, call a United Bank Mortgage

originator for details.

HOME IMPROVEMENT

& PURCHASE REHAB LOANS

Purpose: Home Improvement Loans will be made

for the following purposes:

• repair

• remodeling

• construction of additions

• building a garage

• insulation .. storm windows .. doors

• landscaping

• other enhancements which will improve the

value of the property

Terms:

• May be made on a secured basis.

• Size of loan may be $1,000.00 or greater.

• Length of Amortization may be from

6 to 12 months.

Loans greater than $5,000.00 will be treated as

real estate mortgage loans. The same procedures

for unsecured home improvement loans will apply

to secured home improvement loans.

ADDITIONAL

INFORMATION NEEDED:

•

Estimate Sheets

•

Invoices

• Other information providing your lender with

details of improvements to be made.

LOAN DECISION CRITERIA:

Loan Decision Criteria on Home Improvement

Loans are essentially the same as those discussed

above relative to Real Estate Mortgages.

NOTIFICATION

The applicant for a mortgage or home improvement

loan will be notified of the Bank’s decision

in a timely manner. If you have additional

questions, please arrange to meet with one

of our Loan Representatives or call the bank.

Our Corporate Offices are located at 900

East Paris Avenue SE, Grand Rapids, MI

49546. Phone: 616.559.7000 or 800.968.1990.

NOTIFICATION TO INQUIRIES

AND LOAN APPLICANTS

You have a right to submit a written application for a mortgage

loan or a home improvement loan or to request written

information concerning typical loan terms that we are currently

offering on mortgage loans and home improvement loans. It is

illegal to establish a minimum mortgage amount of more than

$10,000.00 or a minimum home improvement loan of more

than $1,000.00. It is illegal to deny a loan or vary the terms and

conditions of a loan because of the racial or ethnic trends or

characteristics of the neighborhood or the age of the structure,

but not because of its physical condition. If your application

for a loan is rejected, you have a right to a written statement

of the reason for the rejection. If you are granted a loan but

the amount required for a down payment, the interest rate,

term to maturity, application procedure, retail issue, or other

terms or conditions of the loan vary from terms and conditions

offered in the other neighborhoods, you have a right to a

written statement of the reasons for the variation. The rights

described in this notice are set forth in and limited by Act 135,

Public Acts of 1977. If you believe that your rights under this

act have been violated, you should contact the Department

of Insurance and Financial Services. Phone: 877.999.6442.

IMPORTANT INFORMATION ABOUT PROCEDURES FOR

OPENING A NEW ACCOUNT - To help the government fight

the funding of terrorism and money laundering activities,

federal law requires all financial institutions to obtain, verify,

and record information that identifies each person who opens

an account. What this means for you: When you open an

account, we will ask for your name, address, date of birth, and

other information that will allow us to identify you. We may also

ask to see your driver’s license or other identifying documents.

Residential Mortgage

& Home Improvement

Loan Lending Criteria

UnitedBank4U.com01012023

UNITED BANK

RESIDENTIAL MORTGAGE &

HOME IMPROVEMENT LOANS

LENDING CRITERIA :

This pamphlet is being provided in accordance

with Act 135, Public Acts of 1977, which requires

that the public be provided with an explanation in

general terms of the bank’s credit granting criteria

for approval or denial of applications for residential

mortgages and home improvement loans.

DEFINITION OF AN APPLICATION:

•

We will consider a mortgage or home

improvement loan application only when it

is received either in writing or via electronic

application.

•

Telephone inquiries regarding the types of

loans being made, prevailing interest rates

and maturities; will NOT be considered as a

formal loan application.

•

Persons making telephone inquiries will be

sent this pamphlet only if they leave their

name and address at the time of inquiry.

NON-DISCRIMINATION CLAUSE:

•

Any person has the right to make a loan

inquiry and to file a written or electronic

application for a mortgage loan or home

improvement loan and to receive a written

response thereto.

•

All applicants will be given equal

consideration regardless of sex, marital

status, familial status, race, color, religion,

national origin, age, whether all or part of the

applicant’s income is derived from any public

assistance program, or if the applicant has

in good faith, exercised any right under the

Consumer Protection Act.

UNDESIRABLE TYPES OF LOANS:

United Bank is unwilling to extend credit on the

following types of property:

• Basement Homes • Garage Homes

• Berm Homes • Properties which require such

extensive repair that their actual value would

represent a definite risk to the bank.

GENERAL POLICY

PROPERTY CHARACTERISTICS

•

The type of property for residential

mortgages and home improvement loans will

be limited to primary residence, second home

and investment property use. The property

must be well maintained and show evidence

that necessary repairs or improvements have

or will be made where required.

•

The property will conform architecturally

to other properties in the area and will

be designed so that it would be generally

acceptable in terms of room size and layout.

•

Non-commercial first lien real estate

mortgages will be processed and made by

the bank.

•

Home Improvement Loans may be

approved and processed by the bank.

MAXIMUM LOAN TO PROPERTY VALUE RATIOS:

Purchase

Refinance/

Cashout

No Cash

out

Conventional

Mortgage

97% 80% 95%

Construction

Loans

95% N /A N /A

MSHDA/RD 100%

LTV greater than 80% requires PMI

* Loans exceeding 80% LTV are approved subject

to private mortgage insurance (PMI) Approval.

** MSHDA/RD loans are available to home buyers

and homeowners requiring refinance assistance

whose income is within federal and state posted

limits. Prior ownership is waived in defined “target”

areas. These loans are also subject to regulations

as defined by MSHDA.

IMPORTANT CONSIDERATIONS

•

The VALUE OF PROPERTY to be mortgaged is

determined by the appraisal or purchase price,

whichever is lower.

•

The MAXIMUM MATURITY of a loan is 30 years

or the economic life of the home, whichever is

less.

•

The MAXIMUM CONVENTIONAL LOAN

for single family residence is $726,200.00 or

higher as determined by FHFA. Exceptions may

be considered by the Bank’s Loan Committee.(The

maximum loan is subject to change by FHLMC.)

•

ESCROW ACCOUNTS may be required for

property taxes, homeowner’s insurance and/or

ﬂood insurance.

•

TITLE INSURANCE will be ordered on all

mortgages prior to closing to ensure that the title

to the property and any associated encumbrances

will be corrected prior to the loan closing.

•

INTEREST RATES will also be determined by:

1. The amortization of the loan

2. Risk Based model for pricing

3. Loan to Value level

4. Indices for ARM Products

5. Property Use

•

An APPLICATION DEPOSIT of $500.00 will

be required for processing to commence once

the applicant has received the required initial

disclosures, and intends to proceed with a loan.

•

If the mortgage application is denied, the unused

balance of the $500.00 application deposit may

be returned to the applicant.

•

If the mortgage application is approved, fees will

be charged to the applicant at the time of closing

to cover the cost of appraisal, credit report,

recording fees, private mortgage insurance

premiums, the property survey, bank origination

fees, and any other charges that may be

associated with the mortgage processing. Credit

will be given for the $500.00 received with the

intent to proceed.

THE LOAN DECISION

CRITERIA

PAYMENT AMOUNT

RELATIVE TO INCOME:

The proposed mortgage payment, including

taxes and insurance, should not exceed 28% of

the total monthly gross income of the applicant.

Such items as bonuses and commissions

will be considered on an individual basis.

The proposed mortgage payment, including

taxes and insurance PLUS all other monthly

payments on loans, credit plans, and charge

accounts (excluding those which will be fully

paid within 10 months) should not exceed 43% of

the total monthly gross income of the applicant.

The above are general guidelines. Expanded

programs are available.

CREDIT HISTORY:

Individuals with a history of defaults on

obligations, judgements, garnishments,

foreclosure, or bankruptcy filed within the past 3

years will be considered on exception basis only.

EMPLOYMENT:

A two (2) year employment history must be

verified to ensure that the applicant is capable

of holding a position in a comparable income

range. If the income for repayment of the loan

is derived from a source other than employment,

the source and continuation of this income

will be verified by the appropriate means.

DOCUMENTATION OF

THE SOURCE OF DOWN PAYMENT:

Deposit account balances will be verified when

funds are needed for down payment, closing costs

and/or reserves. In cases where these costs are

to be provided as a gift from relatives or another

source, we will require a gift letter signed by

one of the donors, and an authorization to verify

availability of funds.