Home Ownership Pool HOP presented by: Community Development Division
<ul><li>What Is HOP? </li></ul><ul><li>The HOP Advantage </li></ul><ul><li>Income Limits </li></ul><ul><li>HOP Financing <...
What is HOP? The Home Ownership Pool (HOP) has helped hundreds of families purchase homes in the City of Wilmington over t...
Bank Partnership Assures Success HOP has succeeded because partner banks contribute more to the funding “pool” than the Ci...
The HOP Advantage <ul><li>100% Loan-To-Value </li></ul><ul><li>Borrower’s total contribution toward closing costs may be a...
<ul><li>Free Homebuyer Education Seminar </li></ul><ul><ul><li>Every first and third Friday of the Month  9a.m. – 3p.m.  L...
<ul><li>Steps to Homeownership </li></ul><ul><ul><li>How much can they afford </li></ul></ul><ul><ul><li>Prequalification ...
<ul><li>Professional Home Inspection  </li></ul><ul><ul><li>Checking systems and components to make certain everything is ...
<ul><ul><li>All utilities should be on prior to the inspection so that an accurate assessment may be made of the property....
Sample Inspection Report RIESZ PRELIMINARY COST ESTIMATE Name : _Bob Borrower  Address:  22 Happy Homeowner Dr.  Program: ...
HOP Income Limits *1 st  Mtg. @ market interest rate/2 nd  Mtg. @ 0% interest   (Minimum Residency Requirements Apply)** *...
HOP Restrictions & Limitations <ul><li>Restrictions : </li></ul><ul><li>Home must be vacant or owner/buyer occupied (Pleas...
Buy  now  for less than most people pay in rent!! Check out what the HOP Program can do for your clients! <ul><li>HOP Fina...
HOP vs. Conventional   The Comparison <ul><li>Conventional Financing: </li></ul><ul><li>$150,000 at 5.00%*……....$  805.23 ...
HOP Partner Banks <ul><li>BB&T </li></ul><ul><li>First Citizens </li></ul><ul><li>First Federal </li></ul><ul><li>NewBridg...
Home Ownership Pool Recent Home Purchases Offering Your Clients Curb Appeal and More …”
<ul><li>Purchase Price </li></ul><ul><li>$158,000 </li></ul><ul><li>Amount Financed </li></ul><ul><li>$160,000 </li></ul><...
Purchase Price $137,900 Amount Financed $137,900 PITI $837.96 Date Closed August - 2009 Bank’s Interest Rate: 5.25% 609 S....
<ul><li>Purchase Price   $102,000 </li></ul><ul><li>Amount Financed </li></ul><ul><li>$102,000 </li></ul><ul><li>PITI </li...
<ul><li>Purchase Price   </li></ul><ul><li>$124,000 </li></ul><ul><li>Amount Financed </li></ul><ul><li>$124,000 </li></ul...
Purchase Price $165,000 Amount Financed $165,000 PITI $903.55 Date Closed December 22, 2009 Bank’s Interest Rate: 4.875% 1...
Purchase Price $102,400 Amount Financed $102,400 PITI $796.67 Date Closed January – 2010 2308 Wrightsville Ave. Bank’s Int...
<ul><li>Purchase Price </li></ul><ul><li>$174,000 </li></ul><ul><li>Amount Financed </li></ul><ul><li>$174,000 </li></ul><...
“ Questions  &  Answers”
<ul><li>City of Wilmington </li></ul><ul><li>Community Development Division </li></ul>305 Chestnut Street Wilmington, NC  ...
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Home Ownership Pool - City of Wilmington

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Home Ownership Pool - City of Wilmington

  1. 1. Home Ownership Pool HOP presented by: Community Development Division
  2. 2. <ul><li>What Is HOP? </li></ul><ul><li>The HOP Advantage </li></ul><ul><li>Income Limits </li></ul><ul><li>HOP Financing </li></ul><ul><li>Homebuyer Education </li></ul><ul><li>The City Inspection </li></ul><ul><li>HOP vs. Conventional </li></ul><ul><li>Restrictions & Limitations </li></ul><ul><li>Participating Banks </li></ul><ul><li>Recent Home Sales </li></ul><ul><li>Summary / Q&A </li></ul>Topics of Discussion
  3. 3. What is HOP? The Home Ownership Pool (HOP) has helped hundreds of families purchase homes in the City of Wilmington over the past 18 years. It all started with local banks and the City forging a partnership to bring the dream of owning a home to more of our citizens . <ul><li>HOP is not a sub-prime product that sets buyers up for failure. </li></ul><ul><ul><ul><li>Applicants without stable incomes and acceptable credit will not meet the HOP underwriting standards. </li></ul></ul></ul><ul><ul><ul><li>Our goal is to provide long-term home ownership to people of modest means. With the HOP foreclosure rate less than 1%, we have met that goal! </li></ul></ul></ul>
  4. 4. Bank Partnership Assures Success HOP has succeeded because partner banks contribute more to the funding “pool” than the City. <ul><ul><ul><li>HOP financing is structured with a first mortgage provided by a partner bank and a second mortgage provided by the City of Wilmington. </li></ul></ul></ul><ul><ul><ul><li>The banks agree to provide fixed interest rate loans at market rates. </li></ul></ul></ul><ul><ul><ul><li>The City’s loan is also fixed, but no interest is collected as long as the borrowers meet minimum residency requirements. </li></ul></ul></ul>
  5. 5. The HOP Advantage <ul><li>100% Loan-To-Value </li></ul><ul><li>Borrower’s total contribution toward closing costs may be as low as $500 </li></ul><ul><li>Gift funds and seller contributions acceptable </li></ul><ul><li>Higher Ratios: 30/43 </li></ul><ul><li>Effective Interest Rate is Well Below Market Rate </li></ul><ul><li>No Mortgage Insurance </li></ul><ul><li>Repairs & Improvements May Be Included in Loan </li></ul><ul><li>Free Home Inspection </li></ul>
  6. 6. <ul><li>Free Homebuyer Education Seminar </li></ul><ul><ul><li>Every first and third Friday of the Month 9a.m. – 3p.m. Lunch is served. </li></ul></ul><ul><li>Prequalification and/or Credit Counseling </li></ul><ul><li>House Hunting </li></ul><ul><li>Free Pre-Offer Inspection </li></ul><ul><ul><li>Upon Request </li></ul></ul><ul><li>Formal Application </li></ul><ul><li>Loan Processing </li></ul><ul><ul><li>Please allow 45 – 60 days in the contract </li></ul></ul><ul><li>Free City Inspection </li></ul><ul><li>Loan Review </li></ul><ul><ul><li>File transferred to partner bank upon approval </li></ul></ul><ul><li>Closing Package to Attorney </li></ul>HOP Financing
  7. 7. <ul><li>Steps to Homeownership </li></ul><ul><ul><li>How much can they afford </li></ul></ul><ul><ul><li>Prequalification </li></ul></ul><ul><ul><li>House hunting/Working with real estate agents </li></ul></ul><ul><ul><li>Home inspection </li></ul></ul><ul><ul><li>Closing </li></ul></ul><ul><li>What Counts/Becoming Mortgage Ready </li></ul><ul><ul><li>Credit (History, Being Proactive, Value) </li></ul></ul><ul><ul><li>Income/Employment </li></ul></ul><ul><ul><li>Debt & Qualifying Ratios </li></ul></ul><ul><ul><li>Savings (Up-Front Costs, Down Payment, Closing Costs & Reserves) </li></ul></ul>Homebuyer Education <ul><li>Other Items </li></ul><ul><ul><li>Budgeting </li></ul></ul><ul><ul><li>Property Value </li></ul></ul><ul><ul><li>PITI </li></ul></ul><ul><ul><li>Insurances </li></ul></ul><ul><ul><li>HOP </li></ul></ul>
  8. 8. <ul><li>Professional Home Inspection </li></ul><ul><ul><li>Checking systems and components to make certain everything is operating as it was intended . </li></ul></ul><ul><li>City Home Inspection </li></ul><ul><ul><li>Checking for Minimum Housing Code compliance, lead-based paint issues and environmental concerns </li></ul></ul>Property Inspections
  9. 9. <ul><ul><li>All utilities should be on prior to the inspection so that an accurate assessment may be made of the property. </li></ul></ul><ul><ul><li>Lead-based paint is a concern for homes built prior to 1978. </li></ul></ul><ul><ul><li> - The interior and exterior (including soils around drip line) should be thoroughly cleaned of any paint chips and paint dust. </li></ul></ul><ul><ul><li> - Once the inspector sees paint chips or dust, it is too late! The time and expense necessary to test and clear the house may doom the deal. </li></ul></ul><ul><ul><li> - Deteriorated surfaces should be coated to reduce chipping and flaking </li></ul></ul><ul><ul><li> - Provide sufficient time in the sales contract for the inspections and further negotiation if repairs are required. </li></ul></ul><ul><ul><li>Minimum Housing Code issues must be repaired or funds escrowed prior to closing. (Escrowed funds are subject to buyer approval, property appraised value and the City’s bidding process) </li></ul></ul>Points to Remember
  10. 10. Sample Inspection Report RIESZ PRELIMINARY COST ESTIMATE Name : _Bob Borrower Address: 22 Happy Homeowner Dr. Program: H.O.P. Phone Number: 555-2817 Date: 8-25-09 MINIMUM HOUSING CODE TECHNICIAN RECOMMENDATION Item Cost Item Cost L. Gene Langley Housing Rehabilitation Technician ____________________________
  11. 11. HOP Income Limits *1 st Mtg. @ market interest rate/2 nd Mtg. @ 0% interest (Minimum Residency Requirements Apply)** ** Funding for this income tier has been depleted** $69,120 $62,160 $55,320 $48,360 **70%/30% $46,100 $41,500 $36,900 $32,250 60%/40% 4 3 2 1 *1 st Mtg/2 nd Mtg Gross Annual Income Household Size
  12. 12. HOP Restrictions & Limitations <ul><li>Restrictions : </li></ul><ul><li>Home must be vacant or owner/buyer occupied (Please do not show your client homes that have a “tenant in place” even if the tenant is moving ) </li></ul><ul><li>10 or 15 year residency requirements apply to ensure 0% interest </li></ul><ul><li>10 yr. – City’s portion of the loan is under $40,000 </li></ul><ul><li>15 yr. – City’s portion of the loan is $40,000 or above </li></ul><ul><li>Purchase within City limits </li></ul>Maximum Loan Limits $210,000 $220,000 Existing New
  13. 13. Buy now for less than most people pay in rent!! Check out what the HOP Program can do for your clients! <ul><li>HOP Financing: ($150,000 purchase price) </li></ul><ul><li>$90,000 at 5.00%*………$483.13 (1 st mortgage) </li></ul><ul><li>$60,000 at 0.00% ……….. 166.67 (2 nd mortgage) </li></ul><ul><li>Monthly taxes……………. 100.00 (Estimated) </li></ul><ul><li>Monthly insurance……….. 100.00 (Estimated) </li></ul><ul><li>TOTAL PAYMENT …….$849.80 (monthly) </li></ul><ul><li>* Current available rate (as of 3/31/10). Since our loans are financed at fixed interest rates, your loan payment will not increase over the 30 year term. However, the amounts necessary to cover taxes and homeowners insurance are subject to change. </li></ul>
  14. 14. HOP vs. Conventional The Comparison <ul><li>Conventional Financing: </li></ul><ul><li>$150,000 at 5.00%*……....$ 805.23 </li></ul><ul><li>Monthly taxes……………. 100.00 (Est.) </li></ul><ul><li>Monthly insurance……….. 100.00 (Est.) </li></ul><ul><li>Mortgage Ins. (PMI)……... 95.00 (Est.) </li></ul><ul><li>TOTAL PAYMENT ……...$ 1,100.23 (mo.) </li></ul>HOP Financing TOTAL PAYMENT: $849.80 (mo.) <ul><li>Monthly Savings </li></ul><ul><li>$250.43 </li></ul><ul><li>30-year Savings </li></ul><ul><li>(over life of loan) </li></ul><ul><li>$90,154.80 </li></ul>Savings with the HOP Program:
  15. 15. HOP Partner Banks <ul><li>BB&T </li></ul><ul><li>First Citizens </li></ul><ul><li>First Federal </li></ul><ul><li>NewBridge </li></ul><ul><li>RBC </li></ul><ul><li>SunTrust </li></ul>
  16. 16. Home Ownership Pool Recent Home Purchases Offering Your Clients Curb Appeal and More …”
  17. 17. <ul><li>Purchase Price </li></ul><ul><li>$158,000 </li></ul><ul><li>Amount Financed </li></ul><ul><li>$160,000 </li></ul><ul><li>Construction Escrow </li></ul><ul><li>$2,000 </li></ul><ul><li>PITI </li></ul><ul><li>$920.98 </li></ul>2219 Brandon Rd. Date Closed July 24, 2009 Bank’s Interest Rate: 6.50% 70/30
  18. 18. Purchase Price $137,900 Amount Financed $137,900 PITI $837.96 Date Closed August - 2009 Bank’s Interest Rate: 5.25% 609 S. 7 th St. 70/30
  19. 19. <ul><li>Purchase Price $102,000 </li></ul><ul><li>Amount Financed </li></ul><ul><li>$102,000 </li></ul><ul><li>PITI </li></ul><ul><li>$573.77 </li></ul><ul><li>Date Closed </li></ul><ul><li>October - 2009 </li></ul><ul><li>Bank’s Interest Rate: 5.125% </li></ul>1202 S. 6 th St. 60/40
  20. 20. <ul><li>Purchase Price </li></ul><ul><li>$124,000 </li></ul><ul><li>Amount Financed </li></ul><ul><li>$124,000 </li></ul><ul><li>PITI </li></ul><ul><li>$688.20 </li></ul><ul><li>Date Closed </li></ul><ul><li>November 4, 2009 </li></ul><ul><li>Bank’s Interest Rate: 4.875% </li></ul>1115 Davis Sound Lane 60/40
  21. 21. Purchase Price $165,000 Amount Financed $165,000 PITI $903.55 Date Closed December 22, 2009 Bank’s Interest Rate: 4.875% 1413 Parmele Dr. 60/40
  22. 22. Purchase Price $102,400 Amount Financed $102,400 PITI $796.67 Date Closed January – 2010 2308 Wrightsville Ave. Bank’s Interest Rate: 5.125% 60/40
  23. 23. <ul><li>Purchase Price </li></ul><ul><li>$174,000 </li></ul><ul><li>Amount Financed </li></ul><ul><li>$174,000 </li></ul><ul><li>PITI </li></ul><ul><li>$1,031.09 </li></ul><ul><li>Date Closed </li></ul><ul><li>February - 2010 </li></ul><ul><li>Bank’s Interest Rate: 5.00% </li></ul>920 Turgotine Lane 60/40
  24. 24. “ Questions & Answers”
  25. 25. <ul><li>City of Wilmington </li></ul><ul><li>Community Development Division </li></ul>305 Chestnut Street Wilmington, NC 28401 (910) 341-7836 [email_address] Thank You!

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