The document summarizes information from a first time home buyers seminar. It discusses selecting a mortgage lender, understanding different loan types, getting pre-approved for a mortgage, making an offer on a home, getting a home inspection, required insurance, and the closing process. The seminar provides tips on becoming financially prepared, shopping for the best mortgage rates and real estate agents, and navigating the steps to purchasing a first home.

1. First Time Home Buyers Seminar Presented by: Barry A. Duffey

2. Who is Primary Residential Mortgage, Inc? Founded in 1998, PRMI is a debt-free company Headquarters in Salt Lake City, Utah 275 offices nationwide in 47 states More than 1,900 employees A variety of loan products from the nation’s top lenders: Primary Residential Mortgage Bank of America Wells Fargo GMAC, SunTrust, CitiMortgage and more!

3. “A home is an investment. When you rent, you write your monthly check and that money is gone forever. But when you own your home, you can deduct the cost of your mortgage loan interest from your federal income taxes, and usually from your state taxes. This will save you a lot each year, because the interest you pay will make up most of your monthly payment for most of the years of your mortgage. In addition, the value of your home may go up over the years. Finally, you’ll enjoy having something that's all yours—a home where your own personal style will tell the world who you are.” —U.S. Department of Housing and Urban Development

4. Renting vs. Buying

5. Money: What are Mortgages really made of? Credit FICO Score, Overall Profile Capacity Income, Debt to Income Ratio Collateral Loan to Value

6. The Keys to Becoming a Home Owner Organize Watch Spending and Savings No question is a bad question. Elevate your Credit Score Read (and Understand) the Fine Print

7. Down Payments http://loan.yahoo.com/m/basics7.html

8. How much can you afford? Debt-to-Income Ratio—the lower the better: It shouldn’t exceed 36%, though there are exceptions How to calculate your debt-to-income ratio: Calculate your total monthly income: Include wages, overtime, guaranteed commissions/bonuses, alimony If income varies, calculate average based on last two years Add up your monthly debt payments: Include credit cards, car loans, student loans, mortgage payments Divide monthly debt payments by total monthly income —This is your debt-to-income ratio $2,000.00 (total monthly debt) ÷ $6,000.00 (total monthly income) ------------ 0.33 or 33%

9. Mortgage Shopping “Shopping around for a home loan or mortgage will help you to get the best financing deal. A mortgage—whether it’s a home purchase, a refinance, or a home equity loan—is a product, just like a car, so the price and terms may be negotiable. You’ll want to compare all the costs involved in obtaining a mortgage. Shopping, comparing, and negotiating may save you thousands of dollars.” —The Federal Reserve Board

10. Basic Loan Types and Products Conventional Federal Housing Administration (FHA) Veteran’s Affairs (VA)- 100% LTV Virginia Housing Development Authority (VHDA)- 100% LTV United States Dept. of Agriculture (USDA)- 100% LTV 30 Year Fixed 15 Year Fixed ARM

11. Cost Information Interest Rate Points Origination Fee Fees Down Payments Mortgage Insurance “Shop, Compare, Negotiate: Get the best deal that you can!” —Federal Reserve Board

12. Pre-Approval Once you’ve found a mortgage company you’re comfortable with, get pre-approved This essentially gives you a budget for your house “Getting pre-approved will you save yourself the grief of looking at houses you can’t afford and put you in a better position to make a serious offer when you do find the right house. Not to be confused with pre-qualification, which is based on a cursory review of your finances, pre-approval from a lender is based on your actual income, debt, and credit history.” —http://money.cnn.com/magazines/moneymag/money101/lesson8/index.htm

13. Good Faith Estimate (GFE) Required by the Real Estate Settlement Procedures Act (RESPA) within 72 hours of application Provided by mortgage lender Gives an estimate of fees due at closing, including: Loan fees Fees to be paid in advance Reserves Title charges Government charges Additional charges Actual closing costs can differ from GFE

14. Realtor Shopping Demand Excellence Look for Commitment Who will work for you? Consider Education On-going training Up to date market knowledge Conduct Interviews Interview agents to find the “right fit” http://ired.com/buymyself/canale/art3.html

15. Home Shopping Is it THE house? Consider the… Commute Amenities School System Can you really afford it? Remember, starter homes are just that —a start

16. The Offer What are the steps to making an offer? Negotiating a sales price Asking Price Initial Purchase Offer Acceptance of Offer and Counter-Offer Make an offer in writing Proposed Purchase Price Concessions Conveyances Home inspection contingences Earnest Money Acceptance

17. Home Inspection A home inspection is a 3rd party evaluation of a home’s condition by a trained expert. During a home inspection, a qualified inspector takes an in-depth and impartial look at the property you plan to buy. The inspector will: Evaluate the physical condition: the structure, construction and mechanical systems. Identify items that should be repaired or replaced. Estimate the remaining useful life of the major systems (such as electrical, plumbing, heating, air conditioning), equipment, structure and finishes.

18. Insurance Title insurance Lender’s Title Owner’s Title (optional) Homeowners insurance Flood insurance

19. Closing What to expect What you need to know? Cash to Closing? HUD-1 Settlement Statement Do terms match what was quoted? Do not be pressured into signing!

20. Questions and Answers