Mortgage LoanDown Payment Assistance

Championing Successful Home Ownership in our

Communities

Member FDIC

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Down Payment AssistanceWhat is it?

Forgivable grant up to $6000 to assist with down payment and closing costs

Available to households with incomes under limit specified by program

Available on a first come, first served basis as funds are available

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Down Payment AssistanceWhy consider?

Up to $6000 is available at no cost to home buyer No repayment is required when home buyer occupies

property for the time period specified by program Home buyer may keep more of their own funds as reserves

for other expenses Home buyer may be able to borrow less on first mortgage,

increasing initial equity in property, reducing monthly payment, and/or qualifying for more home

Renter may be able to buy sooner (a recent survey by the National Association of Home Builders reported that 73% of renters surveyed want to buy and that saving a down payment was the biggest obstacle)

Why it’s time to buy (Wall Street Journal, June 4, 2011) Rates are near 50-year lows Homes are more affordable than they’ve been in years A historic glut of homes has created a buyer’s market Such conditions might not last long The long term benefits of home ownership remain very much

intact

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Down Payment AssistanceWhy home ownership matters . . . to people, to communities, to America (Source: REALTOR.org/Homeownership)

Home owners are happier and healthier and enjoy a greater feeling of control over their lives

Owning a home is one of the best ways to build long-term wealth (historically, home owner’s net worth has ranged from 31 to 46 times that of a renter)

Most home owners enjoy stable housing costs – a fixed rate mortgage payment might not change for 15 to 30 years while rent typically increases 3% a year

Home owners can typically deduct mortgage interest and property taxes on their federal income tax returns

People who own homes vote more, volunteer more, and contribute more to their neighborhoods

Children of home owners do better in school, stay in school longer, are more likely to participate in organized activities, and spend less time in front of television

Every home purchased pumps more than $60,000 into the economy for furniture, home improvements and related items

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Down Payment AssistanceBenefits to Real Estate Professionals

Reduced cash requirements for buyers = more qualified buyers = more sales

Availability of down payment assistance for buyers of your listings (at no cost to seller) = increased opportunity for seller

Knowledge of down payment assistance programs enhances role as trusted advisor = more satisfied clients

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Down Payment AssistanceBenefits to Home Builders

Reduced cash requirements = more qualified buyers = more sales

The fact that down payment assistance soft second lien is forgivable after 5 or 10 years (depending on program) encourages home buyer to remain in home, reducing re-sale competition within new development

Availability of down payment assistance differentiates homes from other developments

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Down Payment AssistanceBenefits to Mortgage Loan Officers

Reduced cash requirements for buyers = more qualified buyers = more loans

Knowledge of down payment assistance programs enhances role as trusted advisor = more satisfied clients and referral sources

Promotion of down payment assistance programs = commitment to community

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Down Payment AssistanceBenefits to Bank Employees

Additional mortgage loan customers = increased cross sale opportunities

Availability of down payment assistance = increased home ownership opportunities for friends and families

Availability of down payment assistance = pride in Standard Bank as a leader in our communities

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Down Payment AssistanceBenefits to Community Organizations

Additional resource for underserved market segments to achieve home ownership

A tool for neighborhood stabilization and economic empowerment

Important information to complement existing financial outreach efforts

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Down Payment AssistanceSources

Standard Bank is a leader in affordable mortgage programs and currently offers down payment assistance in conjunction with Illinois Housing Development

Authority (IHDA) Federal Home Loan Bank of Chicago

(FHLBC)

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Down Payment AssistanceCurrent Program Comparison

As of July 1, 2011 IHDA SMART MOVE FHLBC Downpayment Plus

Amount of assistance Up to $6000 Up to $6000

Household income All members 18 or older All members 18 or older

Household income limitsExample – family of 4

For 5% of purchase price:Cook, DuPage, Will County $59,850Grundy County 62,850For 3% of purchase price:Cook, DuPage, Will County 104,720Grundy County 110,040

Cook, DuPage, Will County $59,850Grundy County 62,850Lake & Porter County, IN 52,150

Form & repayment of assistance

Forgivable second lien at 0% over 10 years to IHDA

Grant with retention agreement forgivable over 5 years to Standard

Minimum borrower contribution Greater of $1000 or 1% $1000

Pre-purchase counseling Required Required

Eligible properties Owner occupied 1 or 2 units Owner occupied 1 or 2 units

Market areas Throughout Illinois Standard Bank’s Illinois and Indiana lending areas

Eligible first mortgages Conventional insured and USDA SMART MOVE IHDA loans

Conventional, FHA, VA, and other programs

First time home buyer requirement

Borrower may not have owned principal residence during last 3 yrs unless veteran or targeted area

None

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Down Payment AssistanceWhat do I do next? If you are a borrower, get pre-qualified with your

community lender, Standard Bank If you are a real estate professional,

Contact your prospective home buyers regarding down payment assistance

Partner with your loan officer partner at Standard Bank for community outreach

Contact Standard Bank for more information or a presentation regarding down payment assistance

If you are a loan officer, Contact your home buying prospects and pre-qualified

home buyers regarding down payment assistance (if they are not working with a real estate professional, make a referral!)

Contact your referral sources for presentation or information outreach opportunities