The document discusses the benefits of FHA 203(k) Streamline loans, which allow homeowners to finance the purchase of a property and the cost of repairs or improvements in a single loan. Key benefits include being able to finance between $5,000-$35,000 in repairs, updating older homes, and providing affordable financing for first-time buyers or those with credit issues. The program has guidelines around eligible improvement types like kitchens and bathrooms but excludes luxury items or major additions.

1. Increasing Your Sales With FHA 203(k) Streamline Loans Brought to you by:

4. Comparison of FHA and Conventional Loans Stringent stand-alone ratios apply for primary borrower when non-occupant co-borrower is applicable No stand-alone ratios apply for primary borrower Stand-Alone Ratios: Ratio calculations more rigid. Ratio calculations more flexible Ratio Calculations: Household income calculations more rigid Household income calculations more flexible Income Calculations: Conventional: FHA:

5. FHA/Conventional Comparison continued Often 2-month PITI reserve requirement. Typically NO 2-month PITI reserve requirement. Reserve Requirements: May allow non-occupant co-borrowers but there may be additional qualifying restrictions (e.g. additional ratios for occupant co-borrowers). Allows non-occupant co-borrowers without additional qualifying restrictions. Non-occupant co-borrowers: Typically 5% must be from borrower's own funds unless 20% down. Down payment can be derived from gift.* Gifts: Required down payment typically higher than 3.5%. 3.5% down payment requirement Down Payment: Conventional: FHA:

6. FHA Overview Conventional: FHA: Less likely to qualify for Conventional loan than FHA More likely to qualify for FHA loan than conventional loan Bankruptcies & Less-Than-Perfect Credit: Typically more stringent guidelines. Typically more flexible guidelines Guideline flexibility:

26. FHA 203(k) Streamline Application Process Realtor helps borrower locate property. Borrower* and realtor determine improvements based on need or preference. Borrower* obtains contractor bids and cost estimates as soon as possible. *or Cost Consultant hired by borrower

27. FHA 203(k) Streamline Application Process Appraiser determines “as-is” and “improved” values. Loan closes. Initial draw may be disbursed, @ 50% of contract amount. Loan is underwritten and approved.

28. FHA 203(k) Streamline Application Process Construction MUST begin AS SOON AS POSSIBLE AFTER closing, but no later than 30 days from closing Work is completed; final inspection by appraiser; final draw disbursed. MUST BE COMPLETED WITHIN 6 MONTHS OF CLOSING

35. FHA 203(k) Streamline: Questions?