1. Homebuyer Workshop (Sample presentation)
Add your name and contact information
Mary Smith
Appleblossom Realty
Snowshoe, VT
This sample presentation serves as a starting point for developing a homebuyer workshop that you can present to various audiences. Be sure to customize the content in this presentation to meet the needs of the specific audience.

2. Outline The Homebuying Process Evaluating the Pros and Cons
Analyzing Your Financial Situation
Qualifying for a Mortgage
Understanding Credit
Homeownership Responsibilities
Briefly outline the content of the workshop for the participants.
The workshop begins with an overview of the homebuying process, reviews the pros and cons of home ownership, discusses how to analyze your financial situation, describes the mortgage qualification process, includes information on understanding your credit, and concludes with a discussion of homeownership responsibilities.

3. The Homebuying Process
1. Prepare for homeownership
Evaluate the pros and cons
Learn about the process
Homebuyer workshops
Counseling sessions
2. Consult real estate professionals
Select a real estate agent
Select a lender
3. Determine how much you can afford
Prepare a realistic budget
The first step in the homebuying process is to prepare for homeownership. Begin by evaluating the pros and cons of homeownership, which we will discuss shortly. You also can learn about the process by participating in events such as this homebuyer workshop or attending homebuyer and other counseling sessions.
The next step is to consult with real estate professionals, including a real estate agent and a lender.
The third step in the process is determining how much you can afford. We’ll discuss this later in the presentation.

4. The Homebuying Process
4. Begin the mortgage application process
Get loan pre-approval
Apply before you shop for a home
Shop for rates and term
5. Decide on the type of home you want and need
Price
Size
Neighborhood
Lifestyle
6. Make an offer
Purchase contract
Deposit/earnest money
Once you have determined how much you can afford, you should begin the mortgage application process. Speak with several lenders to find the best rates and term, and obtain a loan pre-approval. During this process, the lender will evaluate your income, credit, and financial situation and determine the maximum amount of money to lend you.
Once you have pre-approval, decide on the type of home you want and need. Consider the price you are willing to pay, the size of the house you need, the neighborhood and community in which you wish to live, and how the home will affect your lifestyle.
A real estate agent can help you find a home that meets your criteria. Once you've found a home, you should make an offer on the home and agree to a price with the seller. When you have agreed to terms with the seller, execute a purchase and sale contract with the seller. You might want to have an attorney review the purchase and sale contract before you sign it.

5. The Homebuying Process
7. Complete the mortgage application process
Lender appraises property value
Receive a mortgage commitment
8. Perform your due diligence
Home inspection
Other inspections (septic, water, termite, radon)
9. Buy homeowner’s insurance
10. Close the loan
Sign the closing documents
Seller receives check
Buyer receives keys
11. Move in!
With the purchase and sale contract in hand, you can complete the mortgage application process with your lender. The lender appraises the property and completes its review of your financial situation. You then receive a mortgage commitment letter from the lender that spells out the rate and terms of the loan you will be receiving.
At the same time, you should be performing due diligence on the home. This typically consists of hiring a home inspector to identify any damage or defects in the home. It may also include other types of inspections ― such as water and septic and, in some areas, termite and radon.
When the inspections are complete and you have a mortgage commitment in hand, you're ready to close the loan. To do so, you will need to purchase homeowner’s insurance on the property. At the closing of the loan you will sign the closing documents, indicating you have purchased the property. The seller receives a check at the closing, and you receive the keys.
The final step is to move into your new home.

6. Evaluating the Pros and Cons
Advantages of Homeownership
A place of your own
Financial benefits
Stable housing costs
Opportunity for equity appreciation
Tax benefits
Homebuyer tax credit
Let's talk about evaluating the pros and cons of homeownership.
What are the advantages of homeownership? First, you will have a place of your own — a place to call home. Additionally, homeownership offers financial benefits. These include stable housing costs, the opportunity for equity appreciation as the property value rises, the annual tax deduction of your mortgage interest on your federal income taxes, and the $8,000 first-time homebuyer tax credit sponsored by the federal government.

7. Evaluating the Pro and Cons
Possible Drawbacks of Homeownership
Additional costs
Property taxes, homeowner’s insurance, utilities, and upkeep expenses
Decreased mobility
Possibility of foreclosure
Repairs and maintenance
What are some drawbacks of homeownership?
First, you may have additional costs that you had not paid as a renter, such as property taxes, homeowner’s insurance, utilities, and upkeep expenses. Additionally, owning a home may decrease your mobility. In order to move, you must first sell your home. There is also the possibility of foreclosure should you fail to make your monthly mortgage payments.

8. Analyzing Your Financial Situation
Purchase Costs
Downpayment
Appraisal
Credit report
Loan origination fee
Inspections
Closing costs
Attorney fees
Title insurance
Prepaid items at closing
Moving expenses
Ongoing Costs
Monthly mortgage payment
PITI (principal, interest, taxes, and insurance)
Utilities
Maintenance and repair costs
Let's talk about analyzing your financial situation. Owning a home involves both upfront purchase costs and ongoing monthly costs.
Your purchase costs include your downpayment, which is typically paid from your savings. Additionally, purchasing the home has transaction costs. These include the appraisal, the credit report, and the loan origination fee, all of which are paid to the lender as reimbursement for the lender’s costs in approving your mortgage. There are also costs for the various home inspections, which you typically pay directly to the inspectors. Finally, other costs paid at the closing include the attorney’s fees, title insurance, and prepaid items such as taxes and utilities. And don't forget about the cost you incur to actually move into the property.
Your ongoing costs include your monthly mortgage payment. Typically, the mortgage payment includes the principal and interest on the mortgage plus the real estate taxes and insurance, all known as PITI. The mortgage company collects the taxes and insurance into escrow; it then makes the payments to the insurance company and tax collector at the appropriate times. The mortgage company collects these escrow payments to make it easier for you to budget your monthly payments and to protect itself against your not having enough cash when the payment is due.
Additionally, as a homeowner you will be responsible for making the utility payments for electric, gas, water, and heating oil. Finally, the homeowner is responsible for all of the maintenance and repair costs on the property. These costs encompass calls to the plumber in the middle of the night, the ongoing costs of paint and wallpaper, lawn care, snow removal, and so forth.

9. Analyze Your Financial Situation
Shop for a house that you can afford.
Estimated amount the lender will let you borrow
Money available for a downpayment
From your savings
From a downpayment assistance program
Amount budgeted for monthly payments
Ensure you shop for a house that you can afford. When you prequalify for the mortgage, the lender will let you know how much you can afford to borrow.
You also need to know how much money you have available for downpayment, either from your savings or from a downpayment assistance program.
Add these two up and you have the amount of money available to purchase a home. You also need to be comfortable that the monthly payments on the mortgage fit within the amount you have budgeted.

10. Qualifying for a Mortgage
Have you…
Maintained a steady job history and income?
Paid your bills on time?
Established a credit record?
Saved money for a downpayment?
Limited your outstanding debt?
Let's talk for a minute about qualifying for mortgage. Have you maintained a steady job history and income over time? Have you paid your bills on time? Do you have an established credit record? Have you saved money for a down payment? Have you limited your other outstanding debt? If so, you're probably in a position to qualify for a mortgage.

11. Qualifying for a Mortgage
Lenders consider these factors:
Capital
Money available for upfront costs
Capacity
Ability to pay monthly mortgage payment and other bills
Income
Employment history
Credit History
Past credit, credit report, and credit scores
Collateral
Appraised value for condition of the house you are buying
The lender evaluates several factors when reviewing mortgage applications. The first of these is capital ― he money you have available for the downpayment and other upfront costs.
The second factor is your capacity —that is, your ability to pay the monthly mortgage payments and your other bills from your income. Here the lender also will look at the stability of your employment and your employment history.
Next, the lender will look at your credit history and evaluate whether you have a history of paying your bills on time.
Finally, the lender will consider the property’s appraised value. In the event you are not able to make the payments and a lender must foreclose, the home’s value must enable the lender to recoup the loan.

12. Where to Apply for a Mortgage
Mortgage companies
Banks
Credit unions
Nonprofit community development and housing organizations
Local, state, and federal programs
Typically, homebuyers obtain mortgages from mortgage companies, banks, and credit unions. Additionally, you may be able to obtain a mortgage from your state housing finance agency or from a local nonprofit community development housing organization.

13. Sources of Downpayment Assistance
Financial assistance benefits sponsored by your employer
Federal, state, and local downpayment assistance programs
Nonprofit community development and housing organizations
Saving for a downpayment is often one of the largest barriers to homeownership. In addition to your own savings, you may be able to obtain downpayment assistance from your employer through an employer-assisted housing program or from federal, state, and local downpayment assistance programs.

14. Understanding Credit Obtaining Your Credit Report & FICO Score
EXPERIAN
P.O. Box 2002
Allen, TX 75013
TRANSUNION
Consumer Disclosure Center
P.O.Box 1000
Chester, PA
EQUIFAX
P.O. Box
Atlanta, GA 30374
As you begin the mortgage process, you should obtain a copy of your credit report and FICO score. These can be obtained at no cost from the major credit reporting agencies listed on this slide.

15. Understanding Credit To improve your credit score:
Correct inaccurate information
Pay bills on time
Reduce outstanding debt
Apply for and open new credit accounts only as needed
Use credit cards responsibly
Re-establish credit if you have had problems
Defer interest on purchases, which may lower your score
Check credit reports frequently, which may lower your score
To improve your credit score, review your credit report to ensure it contains accurate information. Paying your bills on time and reducing your outstanding debt can improve your credit score, as can using your credit cards responsibly and demonstrating a willingness to pay your debts.

16. Understanding Credit To correct errors on your credit report:
Follow any instructions on how to correct errors
Call the credit reporting agency
Send information needed to correct the error
Explain the problem in a brief letter
Contact the creditor directly
Write a consumer statement to tell your side of the story
To correct any errors on your credit report, follow the instructions provided on the credit reporting agency's website. You can correct this information by calling the credit reporting agency and then sending the information needed to correct the error or by sending a letter that explains the reason for the error. In instances where a creditor, such as a credit card company, is reporting information incorrectly to the credit reporting agency, you will need to contact the creditor directly.

17. Understanding Credit What if You Don’t Have Credit?
Nontraditional credit report may be needed if you:
do not use banks or credit cards
have insufficient number of credit references to develop traditional credit report
Generally prepared by credit bureau or lender
Borrower must provide a list of credit sources for all regular, periodic payments
Borrower must produce receipts, copies of canceled checks or money orders, and copies of paid bills
If you do not use banks or credit cards or do not have a sufficient number of credit references to develop a traditional credit report, you may qualify to have your credit analyzed using a nontraditional credit report.

18. Understanding Credit Information for a Nontraditional Credit Report
• Housing-related payments
― Rent, utilities, phone, and cable television
• Insurance-related payments
― excluding payroll deductions
― including coverage for medical, automobile, and life
• Payments to merchants and health and child care providers
― tuition and loans obtained
For a nontraditional credit report you provide information on your existing housing-related payments, such as the rent, utilities, phone, and cable television. You also provide information on insurance-related payments, such as for medical, automobile, and life insurance. Nontraditional credit reporting also can include payments to merchants, schools, and childcare providers.

19. Homeownership Responsibilities
Make monthly payments
Mortgage
Taxes and insurance (escrowed with mortgage payment)
Maintain the property
Paint and paper
Mow the lawn, shovel the snow
Routine maintenance (HVAC service)
Repair things that break
Homeowner repairs
Use a professional (e.g., plumber, electrician)
With homeownership comes the responsibilities of making monthly mortgage payments and maintaining the property.
Maintaining the property includes improvements such as painting the house, painting and wallpapering the rooms within the house, patching the bathroom floor, or fixing the kitchen sink. It also includes maintenance of the outside of the property, such as mowing the lawn or shoveling the snow, and routine maintenance, such as having your air conditioning or heating system cleaned regularly.
Finally, homeownership means that you are responsible for repairing whatever breaks in the house. Typically, homeowners make minor repairs to the property themselves and hire a professional, such as a plumber or electrician, for major items.
The NAR HouseLogic website contains information for homeowners on maintaining the home (

20. Resources More Information Add local government websites
Add local downpayment assistance programs here
Add local counseling agencies here
HUD website at
NAR HouseLogic at
National Association of REALTORS® at
You may wish to customize this list of resources for the individual workshops you conduct.