getting started with ahp
TRANSCRIPT
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American Homeowner PreservationHow to Stay in Your
Home
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1. Do you owe more than your home is
worth?
2. Do you have a stable income source?
3. Do you want to stay in your home instead of
foreclosure?
Do You Qualify?
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AHP Mission
AHP Help!
1. AHP investor
buys your home via
short sale—creating
equity and preventing foreclosure
4. Allows homeowner
to repurchase
home at price
significantly less than existing
mortgages.
2. Leases your home to you for no more
than 33% of income
3. Records option to
ensure that you benefit from equity created by short sale
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AHP True Success Story
An Akron homeowner refinanced for $72,000 in February, 2006 and housing expense was $730/month.
CitiResidential approved AHP’s short sale purchase for $15,250
She now pays $405/month and has option to repurchase her home for $17,538.
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Getting Through The Terms
Short Sale: when a lender allows you to sell a home for less than amount due on existing mortgages
Equity: The value of a property, minus debt and/or other obligations
Recording the Option: Recording encumbers the property and creates a public record
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Apply, Negotiate, Close, Lease, Buy Back
1. Submit documents required by lenders
2. List home with AHP affiliate agent
3. Sign preliminary AHP offer to purchase
Step One: Apply
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Negotiate
Required by lenders to initiate short-sale
1. Low offer to stimulate negotiations
2. Unlikely to be approved by lender3. May take months for approval
AHP purchase offers protect participants
4. Dependent upon lender approval5. Satisfaction of all debts and liens
required6. Lease payment identified7. Repurchase price identified
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Close
At closing, homeowner and investor sign:
1. Lease agreement2. Option agreement
Homeowner pays: 1. First month’s rent2. Security deposit
Approval
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Lease
Rent is comparable to similar homes Any amount over 33% of income may be deferred and
added to option price. 5-year lease with payment amounts
increasing 3% annually.
Repairs escrowed at closing and completed within 60 days Cost of additional repairs and maintenance during
lease period added to option price
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Buy Back
1. Work with counselor to qualify to repurchase ASAP
2. Repurchase anytime before the end of 5-year contract
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Repurchasing Your Home
Homeowner can repurchase home for amount AHP Investor acquired home for, plus:15% in years 1 and 2
20% in year 3
25% in year 4
30% in year 5
*Plus cost of repairs needed during the lease period
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The Golden Parachute
If participant moves/chooses not to exercise option to repurchase, home listed for sale.
The participant receives 50% of net seller proceeds over the option price at closing
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More About Golden Parachute
Sale price:$50,000 value increased during lease
Less selling cost: $5,000 closing, commission, etc
Less option price: $17,538
Proceeds to participant: $13,731
50% of Net Seller Proceeds
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Repairs
2. AHP includes repair costs in short-sale acquisition cost and places the money in escrow.
3. Repairs completed after transfer of sale; Cost added to repurchase price
1. Home Inspector estimates repair costs.(Report paid for by homeowner to any inspector. Typically costs $200-300)
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Housing Counseling
1. Budget counseling2. Credit score improvement3. Down payment savings plan4. Review financing options at
the time of repurchase
The participant may receive financial counseling, including:
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FHA Loans
FHA may provide you with a low down-payment loan at favorable
rates:2 years after bankruptcy3 years after foreclosureMust establish positive creditAlternative credit in good
standing: lease, utilities, cable, phone
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How Much Will This All Cost?
You pay NO fees to AHP: No application or upfront fees No monthly option to purchase
fees or appraisal fee. No cost for financial counseling
Your only cost includes: Home inspection fee to firm of
your choice. 1st month’s rent & security
deposit at closing
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Remember…
AHP’s primary goal is to return your home to you as soon as possible
You may cancel the AHP foreclosure prevention process any time prior to closing with no obligation