An Invitation to Become Part of Keyes Family of Services

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FHA Financing prepared for Gary Harmon and
HomeInfoSanDiego.com buyers.
March 10, 2009
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Its Competitive Out There

• As the North County real estate home-financing
  specialist on the team, we understand the
  challenges were facing together in todays
  market
• Elevated inventory of North County homes for sale
• Extended days on the market for listings
• Fewer qualified North County buyers in the
  marketplace
• Sellers and buyers may have unrealistic
  expectations
• Price reductions are tough to get and further
  deteriorate the market

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Simplify Your Sales with FHA Financing
We offer your North County home buyers a suite of
government products, including fixed-rate and
adjustable-rate mortgage options for FHA-eligible
consumers. Government products are an
alternative to nonprime and conventional home
financing for first-time and repeat homebuyers
who qualify for North County home financing based
on flexible guidelines

• No restrictions on the amount of income
• Less-than-perfect credit
• Larger share of income qualifies toward the
  monthly payments

If all borrowers solely rely on the use of
nontraditional credit, they will be required to
participate in a Homebuyer Education program.
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FHA Financing Offers Great Opportunities While
Offering Important Consumer Protections
Low cash requirements for North County home
borrowers. The down payment and all of the
closing costs on an FHA loan can be funded by a
gift to the borrower or a down payment assistance
program1. No negative amortization. As borrowers
make their monthly payments, their loan balance
falls. There are no option payments that may
cause an unassuming borrower to continually
increase the outstanding loan balance. Low
margin options. The margin is the fixed amount
added to the floating market rate to determine
the new rate the borrower will pay when an ARM
resets. The smaller the margin, the lower the
borrowers reset rate will be. And FHA offers low
margins (1.75) -- meaning that the rate
borrowers pay after ARM resets are generally
lower than what theyd pay on many comparable
conventional ARMs. Lowest annual and lifetime
caps. The rate on a 3/1 or 5/1 ARM2 cannot rise
by more than 1 at any annual reset (it is often
2 on conventional ARMs). Over the life of an
FHA loan, the rate cannot be higher than 5 above
the loans initial rate. Available to
non-citizens. Permanent and non-permanent
resident aliens are eligible.

• Not available on loan amounts in excess of
  417,000.
• 1/1, 7/1 and 10/1 ARMs are not currently
  available.

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FHA Financing is Assumable. Yes!
FHA Loans Are Fully Assumable. This means when
your North County home seller is ready to sell
the property, a qualified buyer can assume
responsibility for the home sellers existing
mortgage. Its called an assumption How it
works Much like the process for a new borrower,
the buyer has to receive approval by the lender.
There is typically an assumption fee plus a fee
for the credit report incurred during this
approval process. Additionally, if the house has
appreciated and/or the mortgage has been paid
down significantly since the loan was taken out,
the buyer either has to pay cash or take out a
second mortgage to cover the difference between
the loan balance and the sales price.

• Buyer benefits
• Interest rate lower if interest rate on
  assumed mortgage is lower than market rates at
  the time of purchase
• Lower payments
• Reduced mortgage term

• Agent Benefits Dont underestimate the curb
  appeal!
• Builds in financing for your future listings
• Increases the marketability
• Differentiates the listings

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Who Benefits From FHA Financing?

• First time and repeat North County home buyers
• No first-time homebuyer education requirements
• No limits on the borrowers income
• Borrowers with little money for down payment
• Borrowers with less than perfect credit
• Borrowers who need a non-occupant, co-borrower
• Borrowers looking for flexible income, debt, and
  credit requirements

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What do FHA Products Offer?

• Competitive interest rates / fixed or adjustable
  loans
• Flexible underwriting guidelines for North County
  home purchasers
• Down payment assistance programs3
• Financing for 1-4 unit properties, manufactured
  homes and FHA-approved condominium projects
• Expanded ratios with verification to increase
  purchasing power
• New, temporary higher loan limits can provide
  opportunity in high-cost areas

3. Not available on loan amounts in excess of
417,000. Seller-funded down payment assistance
programs not allowed.
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FHA Policy Enhancements Better Meet Your Needs

• Appraisal requirements closely mirror
  conventional guidelines
• Fee reform eliminates need for seller to pay
  buyer fees
• Processing has been greatly streamlined
• Automated underwriting has been standardized
• Allows for less-than-perfect credit of the North
  County home buyer
• Temporary higher loan limits make FHA a viable
  option in high-cost areas

NEW IMPROVED!
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Customers Can Combine FHA Financing with Free
Flexible Payment Program Options

• Our free Preferred Payment Plansm options
  accommodate borrowers, helping your North County
  buyers manage their budgets and become successful
  homeowners. Common to all of our options is
  automatic withdrawals from the bank accounts of
  the customers choice.
• Our flexible options allow your customers to
• Tie withdrawals to their paycheck schedules. The
  monthly payment can be divided into amounts that
  are withdrawn weekly, biweekly, twice a month, or
  once a month
• Build home equity and reduce interest expense.
  The weekly and biweekly withdrawal schedules
  automatically generate an extra months payment
  each year, which is applied to principal. That
  accelerates the loan payoff, building home equity
  and lowering the interest expense.
• Make automatic payments without committing extra
  cash to their mortgage. The monthly and
  twice-a-month withdrawal schedules dont generate
  additional principal and may be better for those
  managing tight budgets.
• Add additional principal payments. With any
  payment schedule, a set amount can be added to
  each withdrawal to pay down mortgages more
  quickly and reduce total interest paid.

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FHA Financing Can Help You Benefit By

• Helping Close the Sale on North County real
  estate
• Seller contributions are allowed up to 6
• Driving More Buyers
• Differentiate your listed properties in a
  competitive market when you offer interest rate
  buy downs.
• More North County Home Buyers May Qualify
• Minimal or less-than-perfect credit history may
  be acceptable no income limits higher
  percentage of your buyers income can be used to
  qualify
• Moving More Inventory
• Renovation and limited-repair programs can help
  move fixer-uppers

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Our Commitment to Growing Your Business

• Value of Seller Contributions vs. Price
  Reductions

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Our Commitment to Growing Your Business

• Value of North County Seller Contributions vs.
  Price Reductions

• To the BUYER
• Lower monthly payment on fixed and adjustable
  rate mortgages and the borrower will know what
  their future monthly payment will be
• Use toward down payment assistance programs
  resulting in no cash required at closing for loan
  amounts under 417,000 (seller-funded down
  payment assistance programs not allowed)

Email Lender_at_HomeInfoSanDiego.com for more
information or to schedule a personal appointment.
104597 6/08