Showing Optimism in the Housing Market. The information contained within this presentation statistical information representing trends on a national level.

1. Mortgage Market Outlook
Optimism in the Housing Market
Eric Hamilton
Home Mortgage Consultant
NMLSR ID 414113

2. A word about this presentation…
The information contained within this presentation statistical
information representing trends on a national level and is not
a projection or forecast on future trends in homeownership.
1

3. Agenda
Mortgage market outlook discussion topics:
 Consumer confidence
 Housing affordability and interest rates
 Home pricing & sales information
 Housing inventory update
 Distressed property information
 First-time homebuyer outlook
2

4. Consumer confidence on the rise
1
• Consumer
confidence has been
trending upward since
2009
1. Center for Market Research and Measurement Economic and Mortgage Market Outlook, Spring 2012.
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5. Housing affordability is high,
interest rates are low
2
• Housing continues to be
affordable as interest rates are at
historic lows and affordability is at
record highs.
• Interest rates are expected to
remain low throughout 2012
Please note: These charts
2 reflect a national view. For
local information, please see
the local market reports on
the NAR web site at:
http://www.realtor.org/repo
rts/local-market-reports
2. Center for Market Research and Measurement
Economic and Mortgage Market Outlook, Spring 2012.
4

6. Increasing home sales, decreasing housing
inventory
3
• The charts to the left show that
existing and new home sales are
increasing
What does this mean to you?
•As home sales increase, inventory
declines, decreasing the supply of
homes available for sale
3
• As the supply becomes more
closely aligned with demand, home
prices should increase
3. Data as of January 2012.
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7. New construction sales on the rise
4
• Home sales will likely
increase in 2012 (average
5.7% for existing and new),
29%
14% with the great majority of
this increase is estimated to
5% 1% come from new construction
(14%)
• The 2nd chart shows that
housing starts beyond 2012
are expected to increase
dramatically
5
For new construction sales
information in your area, go
to: http://hanleywood.com
or
http://www.realtor.org/rep
orts/local-market-reports
4. As of Feb 2012. An average of MBA, FNMA, and
NAR (FHLMC does not include condos)
5. Data as of February 2012.
6

8. Home sales estimate
• 40-45% of all home sales in 2011
went to current homeowners – a
combination of both primary residence
and vacation usage
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 30-35% of home sales went to
FTHBs
 20-25% of home sales went to
investors
• Investor share may continue to
increase somewhat as more REOs enter
the market
6. Data as of December 2011. • FTHBs are more likely to purchase
move-in properties or properties with
less damage
• Investors are more apt to purchase
properties they can add value to thereby
increasing the return on their investment
7

9. First-time homebuyers
• Chart shows a significant downward
trend in the FTHB share of total
home buyers since the FTHB tax
credit expired in June 2010
FTHB share of home purchases (not
dollars) is expected to be about the
same or slightly less than the
current rate in 2012 (around 32 -
35%)
7. NAR Realtor Confidence Index Survey as of December 2011.
8. NAR. Profile of Home Buyers and Sellers, survey of customers who purchased. July 10 – June 11 (Does not include investors).
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10. First-time homebuyers have options
Potential FTHB market share decrease could be also be attributed to changes in
mortgage financing:
 Tighter credit requirements Over half of first time buyers
 Higher down payment requirements
(54%) chose FHA loans,
compared to 23% repeat
 Lack of down payment funds
home buyers9
But there is hope! Government loans have flexible approval guidelines that
may help FTHB:
FHA loans: VA loans:
 Low down payment requirements
 No income restrictions  No income restrictions
 Expanded qualifying ratios  No minimum credit score for loans
 Nontraditional credit histories may under $700,000
be accepted10
 Expanded qualifying ratios
 Automatic “Total Scorecard”
approval for qualified applicants  Nontraditional credit histories may
be accepted11
Down payment assistance programs
available to qualified applicants
9. Provided by NAR 2011 Profile of Home Buyers and
Sellers report.
10, 11. Homebuyer education required for customers who
are approved solely on nontraditional credit histories. 9

11. First-time homebuyers have options
Wells Fargo Home Mortgage products and programs give
homebuyers financing options:
 Down payment assistance programs
 Community Development Mortgage Program
 Home Asset ManagementSM Account
 Easy-to-OwnSM Native American Home Loan
 Home OpportunitiesSM Program
 Easy-to-OwnSM Guaranteed Rural Housing Program
10

12. Summary
In conclusion, several indicators from research compiled shown today shows
positive signs for the housing market in 2012, potentially creating more
opportunities for you and your buyers:
 Housing is expected to remain extremely affordable
 Interest rates are expected to remain near or at all-time lows
 Home sales are increasing
 Homebuyer traffic is increasing with low inventory numbers occurring in some
areas
 Home prices have begun to stabilize
 FHA & VA loans, along with down payment assistance programs, and other Wells
Fargo product and program offerings, may provide additional financing options for
first-time homebuyers
11

13. Why work with Wells Fargo?
Wells Fargo Home Mortgage is there for you in
all the ways you told us that matter most:
 We work with you to build business, approve buyers and close deals
leveraging our StagecoachPriority® value package including:
 PriorityBuyer® preapprovals12
 Single Source® program
 Buyer ConnectionsSM capabilities
12. A PriorityBuyer® preapproval is based on our preliminary review of credit information only and is not
a commitment to lend. We will be able to offer a loan commitment upon verification of application
information, satisfying all underwriting requirements and conditions, and providing an acceptable property,
appraisal and title report. Not available on nonconforming products or for certain FHA transactions.
For real estate professionals only. 12

14. Why work with Wells Fargo?
StagecoachPriority® value package:
Get the most out of the time and effort you spend showing homes with
our reliable PriorityBuyer® preapproval letter13, it:
 Confirms your buyers are credit-checked and have completed
the first loan decisioning phase
 Provides reliable, preapproved financing in clearly specified
loan amounts and terms on official Wells Fargo letterhead
13. A PriorityBuyer® preapproval is based on our preliminary review of credit information only and is not
a commitment to lend. We will be able to offer a loan commitment upon verification of application
information, satisfying all underwriting requirements and conditions, and providing an acceptable property,
appraisal and title report. Not available on nonconforming products or for certain FHA transactions.
For real estate professionals only. 13

15. Why work with Wells Fargo?
StagecoachPriority® value package:
Benefit from one connection to multiple lending solutions. Our Single
Source® program offers products that span a variety of customer
needs. You have the advantages of a single point of contact backed by
an integrated team of product specialists who can lend in all 50 states.
Products and programs Property types
 Conventional loans  Single-family
 Renovation financing  Condo & co-op
 Non-conforming (Jumbo portfolio) loans  Investment properties
 The Relocation Mortgage Program®  Vacation/second homes
 Downpayment assistant programs (DAPs)  REO and short sale properties
 FHA & VA loans
 New construction financing
 Home equity financing
For real estate professionals only. 14

16. Why work with Wells Fargo?
StagecoachPriority® value package:
Team up for business opportunities! Through our Buyer
ConnectionsSM capabilities, we have the ability to identify and
introduce buyers and sellers who are not yet working with an agent
and recommend those customers to REALTORS® and builders in local
markets.
For real estate professionals only. 15

17. Why work with Wells Fargo?
Leverage the strength of Wells Fargo
We’re committed to being a leader in:
 Keeping you informed about products, programs and industry changes
 Sharing best practices from real estate industry experts
 Leading homebuyer educational resources including My
FirstHomeSMonline educational program and My Home RoadmapSM
service.14
14. The My Home RoadmapSM service provides up to four sessions (an estimated 2 hours) of free
financial coaching with a National Foundation for Credit Counseling (NFCC) certified counselor from a NFCC
member organization that will be paid for by Wells Fargo Home Mortgage. At your option, you may
purchase additional coaching sessions or services or decide to participate in another NFCC member agency
program. Program may change or be discontinued at any time.
For real estate professionals only. 16