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This presentation on buying a Home is presented to you by DFW Metro Housing


This presentation on buying a Home is presented to you by DFW Metro Housing Presented by Colin Rosenthal TEL 214-704-4005 FAX 214-666-3227 – PowerPoint PPT presentation

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Title: This presentation on buying a Home is presented to you by DFW Metro Housing

This presentation on buying a Home is presented
to you by DFW Metro Housing
  • Presented by Colin Rosenthal
  • TEL 214-704-4005
  • FAX 214-666-3227
  • http//

Asha and her children
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Asha Smith and her 2 children Tyler and Faith
Needed a home
  • Once Asha had decided in March of 2008 that she
    was going to get her own home there was no
    stopping her.
  • She persevered and overcame every obstacle and
    on January 8th this year she moved into her Brand
    new home with the help of AHAP and TCHP

Only 890 a month for a Brand new home

  • Ashas Home was appraised at 120000 and TCHP and
    AHAP together gave her 20000 towards the
    purchase of this new home. The 20000 was used
    to pay for the Down payment, Closing costs and
    the balance went to equity in the home. Her
    mortgage was for 92000 and her payment is 890 a
    month. All she had to invest was 1000 and be
    there to answer any questions that came during
    the processing of her loan and that came from

What did it take
  • Team work
  • Every time she was asked for something no matter
    how small, she was on the ball and got it to them
    pronto. This is the only way you are going to
    get into your own home is with TEAM WORK

Chapter OneClosing Costs those horrible words
  • The biggest nightmare for any prospective seller
    or buyer are the 2 words Closing Costs
  • But in any real Estate transaction these are
    words you will always hear.Now to begin
  • Let us for simple calculating reasons let us say
    that we have found you a lovely home priced at
    100000. You would like to submit a contract but
    need to know what you expenses are going to be
    and what you can afford.
  • There are from both sides (Buyer and Seller)
    expenses which are called closing cost associated
    with this contract that are going to cost both
    the buyer and seller lots of money.

Sellers Closing Costs
  • The Home is priced at 100000
  • The seller will have to pay the following
  • Listing agent and buyers agent commissions
    normally about 6 or 6000
  • Title policy and property taxes year to date,
    plus title and legal fee normally these costs
    amount to about 3 or 3000
  • This mean that the sellers closing costs are
    about 9000.

The Actual Buyers closing costs
  • The Actual buyers closing costs are as follows
  • Loan setup fees, prepaid Insurance and Taxes on
    the home. Pre-paid FHA insurance as well as
    other hidden title items. These expenses
    normally add up to about 6 or in this case 6000
    on our 100000 home we are purchasing.

Buyers closing cont.
  • Down payment of Between 3.5 and 5 of the price
    of the home. In this case 3.5 or 3500.
  • Therefore you the buyer will need to have a total
    of 9500 (6000 plus 3500) in the bank to be
    able to purchase THIS HOME FOR 100000.

Buyer Closing Costs page 4
  • Now we have a total of about 9500 we will need
    to buy the home including the down payment
  • The best type of mortgage loan to get today in
    this current market is an FHA 201B FHA loan which
    depending on you earning capacity and credit
    score requires a minimum of 3.5 down payment

The Problem
  • Very few people have 9500 ready and waiting to
    buy a home and this is where our knowledge and
    experience help you get a home of your own
  • There are various different methods of overcoming
    this problem but this is where our team work

The Texas First time Home buyer
  • How can we eliminate or at least help you with
    your Down payment and continue to help you get
    into your home with only 1000 investment?
  • Through Government Grant Programs
  • Example TDHCD Grant program.
  • Arlington Home Assistance Program.

The Arlington Home buyers assistance Program AHAP
  • AHAP Provides first time home owners up to a
    Maximum of 7500 per household for use in down
    payment assistance or closing costs
  • Households who buy in designated area or with
    disabled members can receive up to 10000
  • Or if you purchase a new home built by TCHP you
    can get a 20000 grant like Asha Smith did

Forgiven after 5 years
  • You must stay in the home for 5 to 15 years or
    repay the assistance at 0 interest
  • You must be pre-qualified for a loan through a
    certified Lender (Chris Cook)
  • You must attend an 8 hour home ownership class
    and get a certificate.
  • Cannot have owned a home in the past 3 years

  • You cannot have more than 15000 in liquid assets
    (Cash in Bank)
  • Home must be in the Arlington city limits
  • Income Limits
  • 1 Person family 36,200
  • 2 Person family 41350
  • 3- 46550 4-51700 5-55850 6-59950
  • Income limits are very similar in most towns

  • Eligible North Texas Cities
  • As of July 20, 2008
  • This list is not all inclusive of the eligible
    areas in North Texas. It only covers the major
    towns serviced by Area 3. For specific eligible
    areas, check our eligibility website
    http// or contact the local Rural
    Development Office. You can find all Texas USDA
    Rural Development offices at
  • County Serviced By Cities
  • Archer Decatur Cities include Archer City,
    Windthorst, Holiday and Lakeside City
  • Baylor Decatur No ineligible areas in the County.
    Cities include Seymour
  • Clay Decatur No ineligible areas in the county.
    Cities Henrietta, Byers, Petrolia and Bellevue.
  • Collin McKinney Cities include Princeton,
    Farmersville, Nevada, Lavon, Prosper, Celina,
    Anna, Melissa, Westminster, Blue Ridge, Wylie
  • Cooke McKinney No ineligible areas in the county.
    Cities include Muenster, Callisburg, Valley View,
    Lindsay, Gainesville.
  • Cottle Decatur No ineligible areas in the county.
    Cities include Narcisso and Paducah.
  • Dallas McKinney Eligible cities include
    Seagoville and Combine
  • Denton McKinney Cities include Aubrey, Corinth,
    Little Elm, Justin, Roanoke, Krum, Highland
    Village, Lake Dallas, Ponder, Sanger, Pilot Point
  • Foard Decatur No ineligible areas in the county.
    Cities include Crowell and Thalia
  • Fannin McKinney No ineligible areas in the county
  • Grayson McKinney The entire county except the
    city limits of Sherman and Denison is eligible to
    include Van Alystine, Gunter, Whitewright, Tioga,
    Whitesboro, Pottsboro
  • Hardeman Decatur No ineligible areas in the
    county. Cities include Chillicothe and Quanah.
  • Hunt McKinney Cities include Quinlan, West
    Tawakoni, Celeste, Commerce, Campbell, Lone Oak,
    Caddo Mills

What is required of you?
  • Depending on your Income
  • Not have owned a home in 3 years
  • Must be pre-qualified through Chris as a lending
    partner in the program
  • Once you have filled in your application we will
    work on getting you qualified and do all the
    paperwork for you with your help of course.

Each and Everyone
  • Everybody is different so we will have to work
    with each of you depending on where you want to
    live and what your individual circumstances are

HUD Homes
  • AHAP makes it very difficult to work with HUD
    homes unless they are in perfect condition

Chapter 3 Looking for your dream home
  • We are ready to look for your home
  • All you have to do is provide me with your E-mail
    address and I will set you up even if you dont
    qualify yet. This way you will have an idea of
    what the market is like. I will set up your
    search criteria from the following information

Want to receive listings?
  • Name.
  • E-mail address
  • Phone Number.
  • What can you afford to pay monthly including
    taxes and insurance
  • 1000 a month will give you 100000 on a 30 year
  • Where would you like to live?
  • CityZip

You can also go directly to my web-site
  • You can also view basic listings directly from my
    Web-site as well as fill in a mortgage
  • Please go to
  • http//
  • Look for view MLS listings on the bottom of the
    home page

Receive listings page 2
  • How older home would you like?...........
  • How Big ..Square feet
  • Now tell me something about the house you would
  • How many bedrooms?.......................
  • How many bathrooms?.....................
  • How many garages?.........................
  • Please be realistic in your search and remember
    to keep your monthly payment to what you can

How read a listing
  • Double click the picture to see all the pictures
    (The listing below has 4 pictures)
  • Double click the address to see the map of where
    the home is.
  • At this point we will look at a listing and go
    through it point by point

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We have your home
  • Now we have found a few homes that you like and
    are ready to submit a contract on the one you
    like the most.
  • The reason I say a few homes is because we will
    always be asking the seller for concessions and
    often they will not negotiate or counter so we
    have to find a few nice home that you will like.

Chapter 4 Contracts
  • The Four Family Contract is an 8 page contract
    that we will go through page by page.
  • The Third party Financing Addendum is a 2 page
    form that we will go though
  • If a home is older than 1980, we will also have
    to include a lead based addendum
  • I always have you sign a get a home inspection
  • If the home belongs to a home owners association
    that this form must also be signed
  • Finally there is always a sellers disclosure to
    be signed unless the home is a foreclosure

Contracts Page 1
  • At the top under paragraph 1 Parties
  • First the sellers name below that the buyers
  • Paragraph 2
  • Next down the legal address of the home and also
    its physical address
  • Paragraph 3
  • Next the down payment and the amount to be
    financed with the total selling price below that
  • Paragraph 4
  • The financing arrangements
  • Paragraph 5
  • The earnest money and the title company
  • Paragraph 6A
  • We always ask the seller to pay Title policy

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Page 2 and 3
  • Paragraph 6C
  • Who is supplying the survey
  • Paragraph 6E section 2
  • Does the home belong to a home owners association
  • Paragraph 7 B Page 3 of contract
  • Sellers disclosure Always required except when a
  • Paragraph 7 E
  • We also always ask for a 7 days inspection
    contingency. This is the period you have if a
    problem is found with the home to cancel the
    contract if the seller will not repair the defect

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Contract page 4
  • Paragraph 9 A
  • The closing date is 10/31/2008 (If by this day
    the closing does not take place we have to file
    for an extension and if the seller has decided
    that he no longer wants to sell we are out of
    contract and out of luck as well.
  • Paragraph 10
  • Possession only when funded. When you go to the
    closing, Only after all parties have signed will
    your lender fund the property. Only after
    funding has taken place is the home yours

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Page 4 contract conditions
  • Paragraph 11
  • Special Provisions or Condition of contract to
  • This is where we would ask for the seller to
    participate in the DPAP, Fee and Buyers closing
    cost assistance. Anything else such as Fridge
    stays with house or leave anything in the home
    that is not considered a fixture.
  • Please note that when only asking for down
    payment assistance you insert this on the next

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Page 5, 6 and 7
  • Paragraph 12
  • This is when there is no DPAP involved where you
    would ask the seller to pay all the 6 closing
    costs of the buyer
  • Paragraph 16
  • In case of a dispute are you willing to mediate?
  • Page 6 paragraph 21
  • Full name and address with all your information.
    Both parties if 2 involved
  • Page 7 Date of execution of contract by agent
  • All the addendum that do with the contract
  • Page 7 Paragraph 24
  • Buyers Signature

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The execution of the contract
  • At the bottom of page 7 under paragraph 24 the
    REALTOR who last handles the contract will insert
    a date of execution of both parties have signed.
  • Page 8 of the contract is the realtor commission
    form and the title company execution of contract
    after receiving the earnest money from the buyer
  • This contract is now executed and a legal
    document in any court of law

Signing the Contract
  • Please initial the contract on the left bottom
    under seller from page 1-6 and sign on top of
    your name on Page 7
  • The same thing applies to all the other
    paperwork. You initial the first pages and sign
    the last page.
  • Some pages are already signed by the seller. The
    Sellers Disclosure is always signed by the seller
    before you get it to initial and sign, This
    document is 5 pages long

The addenda and amendments
  • Part of the real estate legalities also consists
    of various addenda and also amendments to the
    original contract.
  • Items that normally are attached to a contract
    from day 1
  • Lead based addendum
  • If the home was built in 1979 or before it was
    posiblt painted with lead based paint.

Lead Paint Addendum
  • The Federal government requires that you as the
    buyer are informed and also sign a Lead based
    Paint addendum telling you that there is a
    possibility that there could after all these
    years be lead paint on the home and that you have
    the right to have this inspected at your own

Get a Home Inspection
  • As a realtor I always give my clients this form
    because having been burnt myself many years ago
    and buying a home with a major foundation issue I
    realize the importance of having a registered
    Texas Home Inspector , Inspect the home within 7
    days of contract under Section 7 F on page 3.
    This of course in voluntary on your part and is
    completely up to you.

Home Owners Association
  • Again if the home you are buying is part of a
    Home-owners association you are required to sign
    the necessary documents and the Home Owners
    association Mandatory membership Addendum form.
    Most of the time you are also required to pay
    about 100 registration as well

Third party Financing Addendum
  • Another form used as part of the purchase is the
    Third Party Financing Addendum.
  • This form is requesting a period of time to apply
    and be financed without loosing your earnest
    money. The normal term is for 30 days Max but
    sometimes sellers will only allow 15 days

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Third Party Financing Cont
  • If you have not cancelled the contract and made a
    request for return of earnest money by the time
    that 30 or 15 days days is up you will loose your
    earnest money.
    communication and return of documents when
    requested by either Chris or ME

Third Party Financing Form
  • Under term we try for 30 days
  • The loan we use is always a fixed rate and at
    normally no more than 7 and the length of the
    loan is either 15 or 30 years at the same
    interest rate
  • The amount of money you are requesting for the
    loan and the Max amount of setup fee is
    normally no more than 3
  • The home must appraise at the selling price and
    please sign on page two and initial page one

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Sign the Third party Financing addendum
  • This addendum is signed on page two at the bottom

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The Sellers Disclosure
  • Federal law requires all sellers (Except
    Foreclosures) to supply the buyer with a Sellers
  • In this disclosure they have to disclose anything
    they know about the property. Including plumbing,
    have there been any water dame claim, foundation
    issues etc. Everything they have done and
    experienced with the home while they owned it and
    anything they know about the home before they
    bought it.

Seller Disclosure
  • This form the seller will sign and you as the
    buyer will receive it sometimes with the contract
    and sometimes after contract to sign. The
    contract will state that the seller has to supply
    it to you within 10 days of contract. You will
    in turn initial and sign it to be returned to the
    listing agent and the title company

The Cancellation of a Contract
  • Once a contract has been cancelled forms are
    needed to legally cancel the contract
  • Forms used to cancel
  • Termination of Contract
  • Request for return of Earnest Money

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Cancellation of Contract
  • The cancellation of contract has to be done in a
    timely fashion or you will loose your earnest
    money. If you cancel because of a Home
    inspection the termination has to be signed and
    submitted before midnight on the 7 days after
    execution of contract. If cancellation is for
    refusal of financing you must cancel before
    midnight on either the 15th or 30th day depending
    on the third party financing addendum

Request for return of earnest money
  • The earnest money which sits in Escrow at the
    title company will only be returned if both the
    buyer and seller agree and sign the release of
    earnest money form. If you cancelled the
    contract on the 31st days the seller has the
    right to retain the earnest ,money but will not
    get it unless you sign the form allowing him to
    get it. On the other hand you will also not get
    it until the matter is decided in a court of law.
    Most Sellers and their agents on the other hand
    are easy to deal with and I seldom have a problem
    with the return of earnest money id the form have
    been filed on time

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  • I hope this presentation has given you more of an
    idea of what is involved in buying a home and
    Please feel free to call me 7 days a week at
    214-704-4005 to answer any questions you may
    have. You may also visit my web-site at
  • http//
  • or E-mail me at
  • Thanks very much for your time,
  • Colin Rosenthal
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