PROFESSIONAL DESK REFERENCE · ON-THE-JOB TRAINING

Loan Officer Knowledge Base

Click a topic and study it like a short chapter. These guides are intentionally separate from SAFE exam preparation: this area teaches how to interview, document, calculate, structure and move a real mortgage file.

Loan Program Quick Compare

A new LO should be able to explain these numbers before recommending a program. “Typical” lender overlays are not agency rules, so the guide distinguishes agency baselines from lender-specific requirements.

Program	Down payment / LTV	Credit baseline	Front / Back DTI	Seller contribution	Insurance / fee
FHA	3.5% down / 96.5% max purchase LTV with MDCS 580+; 10% down / 90% max LTV for 500–579.	FHA financing rules use MDCS 500+; lender overlays can be higher.	Manual baseline 31/43; higher manual ratios require specified compensating factors. TOTAL/AUS is not a single fixed-ratio approval rule.	Generally up to 6% toward eligible costs; cannot replace minimum required investment.	1.75% UFMIP on most forward loans + annual MIP based on term/LTV/loan size.
VA	Often 0% down when entitlement/value support the transaction.	VA itself has no minimum credit score; lender overlays apply.	No separate VA front-end cap; total DTI of 41% is a guide and is secondary to residual income. Above 41% gets closer scrutiny.	Seller concessions capped at 4% of reasonable value; normal closing costs are treated separately from the 4% concession definition.	No monthly MI. Funding fee may apply unless borrower is exempt.
USDA Guaranteed	100% financing / no required down payment for eligible borrowers/properties.	USDA does not publish one universal minimum score; GUS/lender credit analysis and overlays apply.	34% housing / 41% total-debt standard, with permitted flexibility/compensating factors.	Up to 6% of sales price.	Current standard structure uses upfront guarantee fee and annual fee; verify current fee schedule.
Conventional / Fannie	As little as 3% down on eligible 97% LTV principal-residence products; otherwise product/occupancy-specific.	DU casefiles do not have a Fannie minimum score; manual fixed-rate baseline is 620 (ARM 640). Lenders may overlay.	No universal front-end cap. Manual total DTI 36%, up to 45% with required score/reserves; DU maximum generally 50%.	Principal/second home: >90% LTV 3%; 75.01–90% 6%; ≤75% 9%. Investment property 2%.	PMI generally applies above 80% LTV unless another structure applies.
DSCR / Non-QM	Investor/lender-specific; commonly larger down payment than agency owner-occupied products.	No agency minimum. Investor matrix controls.	Borrower personal front/back DTI often is not the primary qualification method; property cash flow/DSCR is central.	Investor-specific. Never assume agency IPC limits.	Pricing, prepay, reserves and DSCR definitions vary by investor.

Teaching rule: Do not memorize a lender overlay as if it were an agency rule. Teach the agency baseline, then teach the student to read AUS findings and the actual lender/investor matrix.

Choose a Knowledge Topic

APPLICATION · 1003

Take a Complete Loan Application

Interview order, two-year residence/employment history, income, assets, liabilities, REO, declarations, property/loan data, and QC before AUS.

OPEN CHAPTER → INCOME · ASSETS

Income & Asset Analysis

Salary, hourly, OT/bonus/commission, self-employment, retirement, rental income, reserves, sourcing and cash-to-close.

OPEN CHAPTER → DOCUMENTS · CREDIT

Upfront Documents & Credit

What to collect, why each item matters, complete statements, large deposits, liabilities, credit events and document security.

OPEN CHAPTER → MATH · QUALIFICATION

DTI, LTV, PITIA & Cash to Close

Front/back ratios with worked examples, LTV/CLTV, payment anatomy, seller credits and how changes affect qualification.

OPEN CHAPTER → FILE FLOW

Application to Clear-to-Close

Credit, documents, AUS, disclosures, processing, appraisal/title/insurance, conditions, final QC and closing communication.

OPEN CHAPTER → BORROWER INTERVIEW

Interview Guide

Questions to ask in order, follow-up triggers, how to uncover program clues, REO, self-employment, gifts and risk before the 1003.

OPEN GUIDE →

Program Chapters

GOVERNMENT

FHA

3.5%/10% down framework, credit tiers, manual/AUS DTI, MIP, seller contributions, gifts, occupancy and file structure.

OPEN FHA → GOVERNMENT

VA

COE/entitlement, zero-down structure, residual income, 41% DTI guide, no VA minimum score, funding fee and concessions.

OPEN VA → GOVERNMENT

USDA Guaranteed

Eligible area and household income, 100% financing, 34/41 ratios, GUS, guarantee/annual fee and 6% seller contribution.

OPEN USDA → AGENCY

Conventional

3% down options, DU, manual DTI, PMI, score rules, seller-contribution tiers, occupancy, gifts and reserves.

OPEN CONVENTIONAL → NON-QM · INVESTOR

DSCR

Property cash-flow qualification, rent evidence, PITIA/debt service, REO, reserves, prepay and investor-matrix differences.

OPEN DSCR → INTERACTIVE

1003 Application Coach

Practice the application field-by-field with coaching before moving into borrower laboratories.

OPEN COACH →

Training System Separation

ON-THE-JOB SYSTEM
12 job modules × 15 teaching slides. Each module ends with a 25-question mastery exam. Borrower labs and 1003 practice are job-training scenarios.

SAFE EXAM SYSTEM
8 section exams × 50 questions and 3 final mocks × 100 questions. Those questions stay tied to the public NMLS SAFE test content outline—not the job-training labs.

Policy snapshot: Updated September 7, 2026 using current public HUD/FHA, VA, USDA Rural Development, Fannie Mae and NMLS materials. Mortgage rules change. Students must verify the current agency guide, AUS findings and lender/investor overlays on every live loan.