Carol Marx

WORKFORCE HOUSING Financing for Employees

Bank Opportunities
Chance to partner with key employers and their employees
Way to introduce new customers to the bank
Support to the community – CRA (Community Reinvestment Act) Initiative

Forms of Employer Assistance
Down payment or closing cost credit
A direct, fully repayable second mortgage or unsecured loan
A forgivable second mortgage or unsecured loan or,
A deferred payment second mortgage or unsecured loan
Mortgage payment differential

Program Financing Currently Offered
Mortgage Guaranty
Up to 97% financing
2 nd mortgage is guaranteed by the employer
Closing Cost Assistance
Certain loan closing costs paid for by the employer
Down Payment Assistance
In additional to the minimum required down payment by the borrower themselves
Funds provided by employer

Example of Financing
Purchase Price: $500,000
First Mortgage @ 80% Loan-to-Value
$400,000
2 nd Mortgage @ 17% (97% Cumulative Loan-to-Value)
$85,000
Down payment Required
$15,000

Comparison $15,000 $100,000 Down Payment $85,000 2nd Mortgage (Guaranteed) $400,000 $400,000 First Mortgage $500,000 $500,000 Purchase Price With Assistance Without Assistance

Bank Participation
Program development
Reviews employer’s offer in comparison to allowable guidelines
Prepares documentation, including a tri-party agreement that is executed by the employee, bank and employer at loan closing
Mortgage Consultation
Estimate of Payments
Estimate of Closing Costs
Pre-qualification Letter
Application to Closing
Loan Servicing
Loan Reporting

Employer Benefits
Bank expertise help create, deliver and maintain the program
Specialized loan helps attract good employees
Discounts from bank provides added value
Program helps to mitigate the high cost of living in Hawaii vs. other states

Conclusion
Partnerships make winning solutions
More employers should consider
Rates and home prices are attractive
Total investment can be minimal

Questions?
Carol Marx – Sr. Vice President,
Residential Lending Sales Manager
Phone: 282-6658; 694-8855
[email_address]

Mahalo!

Carol Marx

by National Housing Conference & the Center for Housing Policy on Oct 14, 2010

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Carol Marx — Presentation Transcript