Workshop binder pdf

First Time Homebuyer

Workshop Handbook

(323) 604-1973 I CommunityWealth@elacc.org

Table of Contents About Us ……………………………………………………………………………………………...i Agreements for a Productive Workshop ……………………………………………………….….ii Managing Your Money...................………………………………………………………………...1 Resource: Monthly Spending Plan ………………………………………………………………..5 Make the Most of Your Credit……………………………………………………………...……… 7 What’s in your FICO score……………………………………………………………........………9 Sample Credit Report ......………………………………………………...……………..……….11 Exercise: Credit Problems and Solutions………………………………………………………..15 Homebuying Process ...............……………………………..……………………………………16 Low Income Purchase Assistance (LIPA) Program………………………………………….....17 Neighborhood Stabilization Program (NSP) ……………………………………..……………..20 Mortgage Credit Certificate (MCC) ……………………………………………………...............22 Real Estate Agents/Brokers ..........................................……………………………………….24 LAHD Participating Lenders ………………………………..................................................... 25 Communities in the City of Los Angeles .………………………………………………………..26 Homebuying Team............………………………………….…………………….……….………27 Help Us Spread the Word: Programs & Services……...…………………………………….....31

ABOUT US

ELACC’s MISSION and VISION ELACC's vision is simple: to help the members of a 95% Latino community create an environment that supports a productive, healthy, and fulfilling life.

The Mission of ELACC is to advocate for economic and social justice in Boyle Heights and East Los Angeles by building grassroots leadership, developing affordable housing and neighborhood assets and providing access to economic development opportunities for low and moderate income families.

ABOUT COMMUNITY WEALTH Since 2002, the Community Wealth Department has assisted over 2,000 families through its services. We are a HUD-certified counseling agency that aims to provide a high quality service through a secure, comfortable, and inviting atmosphere. All of our services are provided in Spanish and English.

VISION The vision of the East LA Community Corporation’s (ELACC) Community Wealth Department is to foster self-sufficient households by promoting wealth and asset building in Boyle Heights and Unincorporated East Los Angeles.

ELACC recognizes the importance of being financially empowered and how it can serve to better the lives of Eastside residents and their families.

Through in-depth financial workshops and individualized counseling sessions, ELACC educates, guides, and helps to empower community residents to take action to reach their financial goals.

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AGREEMENTS FOR A PRODUCTIVE WORKSHOP

1. Be respectful and mindful of others 2. Limit cell phone usage for scheduled break times 3. Save all “case-specific” questions for your counseling session 4. Respect the workshop schedule 5. ______________________________________ 6. ______________________________________ 7. ______________________________________

Thank You for your attendance, understanding, and eagerness to learn!

ii

MANAGING YOUR MONEY Note: The following are strategies, suggestions, and tools that will help you make the most of your money and reach your financial goals!

To begin to make the most of your money and make progress toward your financial goals, one needs to ask them self a simple question, how do I spend my money? To accurately answer this, we highly recommend using a monthly spending plan that will help you keep track of your expenses and income.

Benefits of a Monthly Spending Plan o o o o

Identify unnecessary costs Maintain control over your expenses Start or continue a savings plan Reach your financial goals

How to Create a Monthly Spending Plan The first step is to identify how your money is being spent.

To start off, we recommend that you track your expenses and income on a monthly spending plan for the next 30 days. Below is a step-by-step guide on how to develop a monthly spending plan: Step 1: Identify your expenses by these categories o Fixed Expenses: Consistent monthly expenses o e.g Housing cost, Utilities o Periodic Fixed Expenses: o Auto Insurance, DMV registration fees o Variable: Change from month to month o e.g Food and Gasoline Step 2: Identify the amount that you can save o Consider saving as a necessity and mandatory expense Step 3: Identify your net income o This is the income you receive after taxes and other deductions are taken away from your paycheck

Evaluate your Spending Habits Once you have identified your expenses and income, proceed to ask yourself the following questions: 1. What expenses are the easiest to eliminate?

2. What expenses would be the most difficult to eliminate?

3. Is it worth it to make these changes to reach my financial goals?

Remember to keep in my mind your needs v. wants, to assure that the necessities such as housing, food, utilities, and savings are being prioritized on your monthly spending plan.

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MANAGING YOUR MONEY Ways to Simplify Your Spending Plan  

 

Decide who pays the bills Know when each bill is due- A calendar with payment due dates will help you make payments on time and avoid late fees Open a savings and checking account to keep your money safe, build your savings, and track your expenses Use direct deposit to automatically deposit your paycheck into your bank accounts. Contact your employer to see if this offered at your workplace.

Reach your Goals!

A monthly spending plan will continuously change according to market conditions and your personal needs, so remember to consistently evaluate and adjust as necessary. The following questions will gauge if your plan is working for you: I am reaching my financial goals? o If you had a goal to save $2,000 in a year, and have only saved $200 ten months into the plan, then chances are slim that the goal will be reached. It can be due to the plan not being followed, the goals not being realistic, or many other reasons, so make sure to evaluate and adjust if needed.

Can the rest of the family follow the plan? o If not done in consideration of others, a monthly spending plan can serve as point of stress and tension within the household. Consider others needs when creating and implementing a plan.

This can serve as a great opportunity to have the family invested and working toward shared goals.

Tips to Succeed! o Always organize and keep copies of important documents, such as your tax returns, bank statements, pay stubs, birth certificate, etc. in a safe and secured location o Try to save 10% of your salary and always put away money for emergencies

We hope these suggestions, tools, and strategies will help you reach your financial goals!

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MANAGING YOUR MONEY Case Study Jessica is a divorced, single mother of two boys, ages six and seven. She works full time at the local library and earns $50,000 a year. She receives no alimony and no public assistance.

To save money after her divorce, Jessica moved into her parents’ home and plans to move out as soon as possible into a three-bedroom apartment. To afford monthly rent, she knows that she’ll need to make changes to her spending habits. She’s reviewed all of her expenses and doesn’t see any ways to cut back her spending, as she believes that she buys only what her family needs.

Here’s a profile of Jessica’s spending habits: Food       

Makes breakfast for her sons every morning but has no time to make breakfast for herself, so she buys something at a coffee shop next to work, which usually costs about $6 each work day.

For lunch, gets a sandwich and drink at a local deli for about $9 Buys lunches for the children at the school cafeteria for $5 each.

Usually gives her sons frozen dinners because she is too tired to cook.

Goes out for pizza and ice cream every Friday night, which costs about $45 for the three of them.

Shops for food only when she needs to, often picking up some canned goods and other items at a drug store near work because it’s convenient.

Isn’t sure how much she spends each week or month on food.

Clothing    

Has to buy clothes regularly for the boys because they grow fast, but they insist on wearing fashionable clothes to school.

Buys high-quality , designer-type dresses for herself that sometimes cost at least $100 Doesn’t keep track of how much she spends on clothing, Always uses her credit cards for clothing purchases, making the minimum payment of $50 each month.

Housing 

Wants to move into a three-bedroom apartment so the boys can have their own rooms, which would cost about $1,600 a month where she wants to live in the suburbs.

Furniture 

Stores furniture from her marriage at a public facility because it doesn’t fit in her parents’ home, which costs about $25 a month.

NeighborWorks® America

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MANAGING YOUR MONEY Transportation   

Has a car from the marriage, a 1993 Ford that’s paid for but doesn’t run very well, so she has to get it repaired every few months.

The repairs, insurance, gas and maintenance cost her about $300 a month, and she uses the car for errands and work, which is about seven miles from her parents’ house.

Parks free at the library.

Entertainment     

Takes the boys to the movies every Saturday night, which costs $40 for all of them.

Rents videos occasionally.

Subscribes to cable TV so her children can watch movies and sports, which costs almost $100 per month.

Buys a newspaper every day on her way to work and subscribes to four magazines, which all together cost her around $100 a year.

Belongs to a health club where she goes three times a week to jog on the treadmill and do aerobics, at a membership cost of $30 a month.

Suggestions for Jessica:

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NeighborWorks® America

Monthly Spending Plan Basic Need

Monthly Expenses Housing Rent or Mortgage Heating (gas or oil) Electricity Water or Sewage Trash Service Home Maintenance Cleaning Supplies Lawn Care Other Housing Sub-Total Telephone Land Line Cell Phones Telephone Sub-total Transportation Gas Car Payment Public Transportation or Taxi Parking and Tolls Car Insurance Car Inspection Car Repairs and Maintenance License Plates and Registration Fees Other Transportation Sub-Total Insurance Health (medical and dental, if not payroll deducted) Life Disability Other Medical Doctor Dentist Prescriptions Other Childcare Childcare or Babysitters Child Support or Alimony Food Groceries School Lunches Work-Related (lunches and snacks) Other Savings Emergency Fund Down Payment Fund Education (Continuing or Children’s) Tuition Books, Papers and Supplies Newspapers and Magazines

Budgeted Amount

Actual Spent

Difference

0

0

0

0

0

0

0

0

0

0

5

Basic Need

Monthly Expenses Lessons (sports, dance, music) Other Donations Religious or Charity Other (if not payroll deducted) Personal Barber or Beauty Shop Toiletries Children’s Allowances Tobacco Products Beer, Wine, Liquor Clothing Laundry and Dry Cleaning Other Entertainment Movies, Sporting Events, Concerts, Theater, Etc. Video Rentals Internet Service Cable/Satellite TV Restaurants and Take-Out Meals Gambling or Lottery Tickets Fitness or Social Clubs Vacations/Trips Hobbies or Crafts Holidays & Events Gifts Other Miscellaneous Checking Account Fees, Money Order Fees, Etc Pet Care or Supplies Postage Pictures and Photo Processing Other Indebtedness Expenses Debts Student Loan Credit Card (monthly minimum*) Credit Card (monthly mínimum*) Credit Card (monthly minimum*) Medical Bills Personal Loan Car Loan Other Indebtedness Sub-Total Total Monthly Expenses Income Total Monthly Net Income Additional Savings Amount Left Over for Savings (total monthly net income - total monthly expenses)

Budgeted Amount

Actual Spent

Difference

0

0

0

0

0

0

0

0

0

0

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MAKE THE MOST OF YOUR CREDIT

Credit Bureaus: Experian P.O. Box 9532 Allen, TX 75013 888-397-3742 www.experian.com

Equifax P.O. Box 740241 Atlanta, GA 30374-0241 800-525-6285 www.equifax.com

Transunion P.O. Box 6790 Fullerton, CA 92832-6790 800-680-7289 www.transunion.com

Non-Profit vs. For-Profit Non-Profit Credit Counseling Agencies  Free or small charge to consumer  Helps negotiate with lending companies  Frequently offer budgeting and financial planning services  Consolidates customer payments

For-Profit Debt Management Agencies  First charges up-front fees o Usually 15% to 20% of debt  Then negotiates with creditors  Can significantly and negatively impact your credit score  Debt is five time more likely to chargeoff after one year  Heavy media advertising

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MAKE THE MOST OF YOUR CREDIT

What Rights Do You Have?

Equal Credit Opportunity Act

Truth in Lending Act

Fair Credit Billing Act

Fair Credit Reporting Act

Fair Debt Collection Practices Act

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 Eliminates discrimination of lender towards a consumer on the basis of the age, sex, race, religion, ethnicity, and/or nationality.  Creditor is required to respond to consumer within 30 days with denial reason.  Lender must give complete and precise information according to the costs and terms of a loan.  Companies must give monthly statements on accounts with information related to balance, billing cycle, charges, payments and other necessary information.  Gives consumers the right to ask within 60 days if there is an error on a credit report regarding an account.  Requires that creditor initiate an investigation within 30 days.  Requires that the creditor give a response to an investigation within 90 days.  Protects your right to know what is on your credit report and correct any errors.

Prevents agencies from:  Using language that is both offensive and aggressive.  Calling your home too early or too late.  Calling excessively.  Saying that they will tell your boss or friends.  Trying to charge more than what you owe.  Going to your home under false pretenses.  Sending correspondence that appears to look official government business and/or judicial.

What Makes Up Your FICO® Credit Score?

300 Only secured loans are given in this range.

640 Creditors will give you a loan, but with high interest rates.

680 You will be approved almost everywhere with good rates.

720

850

You will get the best interest rates everywhere.

Payment History is 35% Lenders are most concerned about whether or not you pay your bills. The best indicator of this is how you’ve paid your bills in the past. Late payments, collections, and bankruptcies all affect the payment history of your credit score. More recent delinquencies hurt your credit score more than those in the past.

Debt Level is 30% The amount of debt you have in comparison to your credit limits is known as credit utilization. The higher your credit utilization – the closer you are to your limits – the lower your credit score will be. Keep your credit card balances at about 30% of your credit limit or less.

Inquiries are 10% Each time you make an application for credit, an inquiry is added to your credit report. Too many applications for credit can mean that you are taking on a lot of debt or that you are in some kind of financial trouble. While inquiries can remain on your credit report for two years, your credit score calculation only considers those made within a year.

Length of credit history 15% Having a longer credit history is favorable because it gives more information about your spending habits. It’s good to leave open the accounts that you’ve had for a long time.

Mix of credit is 10% Having different kinds of accounts is favorable because it shows that you have experience managing a mix of credit. This isn’t a significant factor in your credit score unless you don’t have much other information on which to base your score.

Open new accounts as you need them, not to simply have what seems like a better mix of credit.

Source: myFICO.com & creditcomeback.org

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WHAT’S IN YOUR FICO® SCORE Length of Credit History   

Time since accounts opened Time since accounts opened, by specific type of account Time since account activity

New Credit     

Number of recently opened accounts, and proportion of accounts that are recently opened, by type of account Number of recent credit inquiries Time since recent account opening(s), by type of account Time since credit inquiry(s) Re-establishment of positive credit history following past payment problems

Types of Credit Used 

Number of (presence, prevalence, and recent information on) various types of accounts (credit cards, retail accounts, installment loans, mortgage, consumer finance accounts, etc.)

Please note that: 







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A FICO score takes into consideration all these categories of information, not just one or two.

No one piece of information or factor alone will determine your score.

The importance of any factor depends on the overall information in your credit report.

For some people, a given factor may be more important than for someone else with a different credit history. In addition, as the information in your credit report changes, so does the importance of any factor in determining your FICO score. Thus, it's impossible to say exactly how important any single factor is in determining your score - even the levels of importance shown here are for the general population, and will be different for different credit profiles. What's important is the mix of information, which varies from person to person, and for any one person over time.

Your FICO score only looks at information in your credit report.

However, lenders look at many things when making a credit decision including your income, how long you have worked at your present job and the kind of credit you are requesting.

Your score considers both positive and negative information in your credit report.

Late payments will lower your score, but establishing or re-establishing a good track record of making payments on time will raise your FICO credit score.

Sample Credit Report

Page 1 of 4

Report number: Online Personal Credit Report from Experian for Index: - Potentially negative items - Accounts in good standing - Requests for your credit history - Personal information - Important message from Experian - Contact us

Experian credit report prepared for

JOHN Q CONSUMER Your report number is

1

1562064065 Report date:

04/24/2007

You will need your report number to contact Experian online, by phone or by mail.

Index:

2

Experian collects and organizes information about you and your credit history from public records, your creditors and other reliable sources.

Experian makes your credit history available to your current and prospective creditors, employers and others as allowed by law, which can expedite your ability to obtain credit and can make offers of credit available to you. We do not grant or deny credit; each credit grantor makes that decision based on its own guidelines.

Navigate through the sections of your credit report using these links.

To return to your report in the near future, log on to www..experian.com/consumer and select “View your report again” or “Dispute” and then enter your report number.

Potentially negative items:

If you disagree with information in this report, return to the Report Summary page and follow the instructions for disputing.

Items that creditors may view less favorably. It includes the creditor's name and address, your account number (shortened for security), account status, type and terms of the account and any other information reported to Experian by the creditor.

Also includes any bankruptcy, lien and judgment information obtained directly from the courts.

Potentially Negative Items

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Public Records Credit grantors may carefully review the items listed below when they check your credit history. Please note that the account in formation connected with some public records, such as bankruptcy, also may appear with your credit items listed later in this report.

MAIN COUNTY CLERK

Address:

Identification Number:

Plaintiff:

123 MAINTOWN S BUFFALO , NY 10000

1

ANY COMMISSIONER O.

Status:

Status Details:

Civil claim paid.

This item was verified and updated in Apr 2007.

Date Filed:

Claim Amount:

10/15/2006

$200

Date Resolved:

Liability Amount:

03/04/2007

Status: Indicates the current status of the account.

NA

Responsibility: INDIVIDUAL

Credit Items For your protection, the last few digits of your account numbers do not display.

ABCD BANKS

Address:

Account Number:

100 CENTER RD BUFFALO, NY 10000 (555) 555-5555 Status: Paid/Past due 60 days.

1000000....

4

Date Opened:

Type:

Credit Limit/Original Amount:

10/2005

Installment

$523

Reported Since: Terms: 11/2005 12 Months Date of Status: Monthly Payment: 04/2007

High Balance: NA

Recent Balance: $0 as of 04/2007

$0

Recent Payment:

Last Reported:

Responsibility:

$0

04/2007

Individual

If you believe information in your report is inaccurate, you can dispute that item quickly, effectively and cost free by using Experian's online dispute service located at: www.experian.com/disputes Disputing online is the fastest way to address any concern you may have about the information in your credit report.

Account History: 60 days as of 12-2006 30 days as of 11-2006

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Sample Credit Report

Page 2 of 4

MAIN COLL AGENCIES

Address:

Account Number:

Original Creditor: TELEVISE CABLE COMM.

PO BOX 123 0123456789 ANYTOWN, PA 10000 (555) 555-5555 Status: Collection account. $95 past due as of 4-2000.

Date Opened:

Type:

Credit Limit/Original Amount:

01/2005

Installment

$95

High Balance:

Reported Since: Terms: NA 04/2005 Monthly Date of Status: Payment: 04/2005

NA

Recent Balance: $95 as of 04/2005

$0

Recent Payment:

Last Reported:

Responsibility:

$0

04/2005

Individual

Accounts in good standing:

Your statement: ITEM DISPUTED BY CONSUMER Account History: Collection as of 4-2005

5

Accounts in Good Standing

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Lists accounts that have a positive status and may be viewed favorably by creditors. Some creditors do not report to us, so some of your accounts may not be listed.

AUTOMOBILE AUTO FINANCE

Address:

Account Number:

100 MAIN ST E SMALLTOWN, MD 90001 (555) 555-5555 Status: Open/Never late.

12345678998....

Date Opened:

Type:

01/2006

Installment

Type:

6

Reported Since: Terms: 01/2006 65 Months Date of Status: Monthly Payment: 04/2007

Credit Limit/Original Amount: $10,355

High Balance: NA

Recent Balance: $7,984 as of 04/2007

$210

Recent Payment:

Last Reported:

Responsibility:

$0

04/2007

Individual

MAIN

Address:

Account Number:

PO BOX 1234 FORT LAUDERDALE, FL 10009 Status: Closed/Never late.

1234567899876

Date Opened:

Type:

Credit Limit/Original Amount:

03/1997

Revolving

NA

Reported Since: Terms: 03/1997 1 Months Date of Status: Monthly 08/2006 Payment:

High Balance: $3,228

Recent Balance: $0 /paid as of 08/2006

$0

Recent Payment:

Last Reported:

Responsibility:

$0

08/2006

Individual

Your statement: Account closed at consumer's request

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Account type indicates whether your account is a revolving or an installment account.

Sample Credit Report

Requests for Your Credit History

Page 3 of 4

7

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Requests Viewed By Others We make your credit history available to your current and prospective creditors and employers as allowed by law. Personal data a bout you may be made available to companies whose products and services may interest you.

The section below lists all who have requested in the recent past to review your credit history as a result of actions involving you, such as the completion of a credit application or the transfer of an account to a collection agency, application for insurance, mortgage or loan application, etc. Creditors may view these requests when evaluating your creditworthiness.

HOMESALE REALTY CO Address:

Date of Request:

2000 S MAINROAD BLVD STE ANYTOWN CA 11111 (555) 555-5555

07/16/2006

Comments: Real estate loan on behalf of 3903 MERCHANTS EXPRESS M. This inquiry is scheduled to continue on record until 8-2008.

M & T BANK Address:

Date of Request:

PO BOX 100 BUFFALO NY 10000 (555) 555-5555

02/23/2006

Comments: Permissible purpose. This inquiry is scheduled to continue on record until 3-2008.

WESTERN FUNDING INC Address:

Date of Request:

191 W MAIN AVE STE 100 INTOWN CA 10000 (559) 555-5555

01/25/2006

Comments: Permissible purpose. This inquiry is scheduled to continue on record until 2-2008.

Requests Viewed Only By You The section below lists all who have a permissible purpose by law and have requested in the recent past to review your information. You may not have initiated these requests, so you may not recognize each source. We offer information about you to those with a permissible purpose, for example, to: l l l l l

other creditors who want to offer you preapproved credit; an employer who wishes to extend an offer of employment; a potential investor in assessing the risk of a current obligation; Experian or other credit reporting agencies to process a report for you; your existing creditors to monitor your credit activity (date listed may reflect only the most recent request).

We report these requests only to you as a record of activities. We do not provide this information to other creditors who evaluate your creditworthiness.

Requests for your credit history: Also called “inquiries,� requests for your credit history are logged on your report whenever anyone reviews your credit information. There are two types of inquiries. i.

Inquiries resulting from a transaction initiated by you.

These include inquiries from your applications for credit, insurance, housing or other loans. They also include transfer of an account to a collection agency. Creditors may view these items when evaluating your creditworthiness. ii.

Inquiries resulting from transactions you may not have initiated but that are allowed under the FCRA. These include preapproved offers, as well as for employment, investment review, account monitoring by existing creditors, and requests by you for your own report. These items are shown only to you and have no impact on your creditworthiness or risk scores.

MAIN BANK USA Address:

Date of Request:

1 MAIN CTR AA 11 BUFFALO NY 14203

08/10/2006

MYTOWN BANK Address:

Date of Request:

PO BOX 825 MYTOWN DE 10000 (555) 555-5555

08/05/2006

INTOWN DATA CORPS Address:

Date of Request:

2000 S MAINTOWN BLVD STE INTOWN CO 11111 (555) 555-5555

07/16/2006

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Sample Credit Report

Personal Information

Page 4 of 4

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Personal information:

The following information is reported to us by you, your creditors and other sources. Each source may report your personal information differently, which may result in variations of your name, address, Social Security number, etc. As part of our fraud prevention efforts, a notice with additional information may appear. As a security precaution, the Social Security number that you used to obtain this report is not displayed. The Name identification number and Address identification number are how our system identifies variations of your name and address that may appear on your report. The Geographical Code shown with each address identifies the state, county, census tract, block group and Metropolitan Statistical Area associated with each address.

Names:

Address: 123 MAIN STREET

JOHN Q CONSUMER

ANYTOWN, MD 90001-9999

Name identification number: 15621

Address identification number:

JONATHON Q CONSUMER

Type of Residence: Multifamily

Name identification number: 15622

Geographical Code: 0-156510-31-8840

0277741504

J Q CONSUMER

Name identification number: 15623

Address: 555 SIMPLE PLACE

Social Security number variations:

Address identification number:

999999999

Type of Residence: Single family

May include name and Social Security number variations, employers, telephone numbers, etc.

Experian lists all variations so you know what is being reported to us as belonging to you.

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ANYTOWN, MD 90002-7777 0170086050

Address information:

Geographical Code: 0-176510-33-8840

Year of birth: 1959

Your current address and previous address(es)

Address: 999 HIGH DRIVE APT 15B ANYTOWN, MD 90003-5555

Spouse or co-applicant:

Address identification number:

JANE

0170129301

Employers:

Type of Residence: Apartment complex

ABCDE ENGINEERING CORP

Geographical Code: 0-156510-31-8840

Telephone numbers:

Personal statement:

(555) 555 5555 Residential

Your Personal Statement

Any personal statement that you added to your report appears here.

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No general personal statements appear on your report.

Important Message From Experian

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By law, we cannot disclose certain medical information (relating to physical, mental, or behavioral health or condition). Althou gh we do not generally collect such information, it could appear in the name of a data furnisher (i.e., "Cancer Center") that reports your payment history to us.

If so, those names display in your report, but in reports to others they display only as MEDICAL PAYMENT DATA. Consumer statements included on your report at your request that contain medical information are disclosed to others.

Contacting Us Contact address and phone number for your area will display here.

ŠExperian 2007. All rights reserved.

Experian and the Experian marks herein are service marks or registered trademarks of Experian.

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Personal information associated with your history that has been reported to Experian by you, your creditors and other sources.

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Note - statements remain as part of the report for two years and display to anyone who has permission to review your report.

EXERCISE

Credit Problems and Solutions Matching Exercise Write down as many of the letters of possible solutions on the right as apply to the credit problems on the left. You may use letters more than once. Multiple letters may apply to a problem.

Common problems

Possible solutions

1.

Past-due credit accounts

A. Dispute the information with the credit reporting agency

2.

Bankruptcies

B. Seek professional help

3.

Inaccurate information

C. Pay them

4.

Past poor credit performance

D. Negotiate a discounted payoff

5.

Judgments or liens

E. Prepare a realistic spending plan

6.

Pattern of late payments

F.

7.

Foreclosures or repossessions

G. Write an explanation letter

8.

Charge offs

H. Re-establish credit

Set a new payment schedule with the creditor

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



1 Prepare for Homeownership Decide if you should rent or buy by carefully weighing the pros and cons of homeownership & your current situation Attend homebuyer education classes and individual counseling sessions

6

5 Shop for a home  Hire a real estate agent  Compare & examine homes on the market  Take notes and ask questions

10 Obtain insurance & have additional inspections  Shop for and buy a homeowners insurance policy to protect your house from casualty and liability  Hire a title company to conduct a title search and issue the lender a title insurance policy Schedule additional inspections as needed or required 

Determine how much you can afford to spend Prepare a realistic spending plan that includes all of your monthly obligations and regular expenses

Make an Offer  Make a written purchase proposal accompanied by earnest money and contingent upon a satisfactory home inspection  Negotiate if the seller makes a counter-offer

9

2

11 Steps in the Homebuying Process

?

7 Open ESCROW When Offer is Accepted

8 Apply for a mortgage loan Complete a formal application at the lender’s office

Get a professional home Inspection  Hire a professional home inspector & accompany him/her on site  If there are any problems, cancel the sale or ask the seller to make the repairs or give a credit

3

Get your loan pre-approved  Shop around for the best loan product  Compare Good Faith Estimates and Truth in Lending Disclosure

4

Decide what kind of home you want and/or need Consider: Affordability, family size, lifestyle, and special circumstances

11

Close the loan

Sign closing doc-



Deed is recorded

Pay closing costs





Receive the keys

uments



to your new home

CITY OF LOS ANGELES HOUSING AND COMMUNITY INVESTMENT DEPARTMENT (HCIDLA) LOW INCOME PURCHASE ASSISTANCE (LIPA) PROGRAM

(AT THIS TIME ALL LIPA FUNDS HAVE BEEN FULLY RESERVED) The City of Los Angeles Housing and Community Investment Department (HCIDLA) offers purchase assistance financing to eligible first-time, low income homebuyers seeking to purchase a home in the City of Los Angeles.

HCIDLA provides assistance in the form of a deferred loan for purchase assistance which includes down payment, closing costs and acquisition financing.

HCIDLA LOAN LIMITS  Up to $60,000 for purchase assistance, down payment and closing costs (loan funds may be used to cover closing costs up to 5% of the purchase price).  Up to $5,000 for lead-based paint stabilization (if needed) for homes built before 1978.

HCIDLA will perform a Lead Visual Assessment of all homes built before 1978 to determine if potential leadbased paint hazards exist. If it is determined by HCIDLA’s inspectors that the paint stabilization will cost more than $5,000, the project will be deemed not feasible by HCIDLA. PROGRAM REQUIREMENTS  Applicant must be a first-time homebuyer, defined as someone who has not had an ownership interest in any real property at any time during the last three (3) years.  Applicants must attend an 8-hour Homebuyer Education Class provided by one of HCIDLA’s Approved Homebuyer Education Providers (see Approved List).  Applicants must occupy the property as their primary residence.  Total household income of all adults 18 years of age or older who will be living in the home must be at or below the limits shown on the table below.  Borrower must be a U.S. Citizen, lawful permanent resident alien, or other qualified alien.

LIPA Rev: 4.17.14

17

 If eligible, Applicants who apply for the LIPA Program will also be required to apply for a Mortgage Credit Certificate (MCC).

2014 MAXIMUM INCOME LIMITS Household Size Annual Household Income

1 person $45,650 or less

2 people $52,200 or less

3 people $58,700 or less

4 people $65,200 or less

5 people $70,450 or less

6 people $75,650 or less

7 people $80,850 or less

8 people $86,100 or less

(For larger household size limits, please contact HCIDLA)

MAXIMUM VALUE / PURCHASE PRICE LIMIT: Single Family Residences:

$475,000

Condominiums:

$380,000

HCIDLA LOAN TERMS     

Deferred, requiring no monthly payments.

Shared Appreciation applies to the HCIDLA purchase assistance loan.

Three percent (3%) simple interest will be charged on the paint stabilization loan portion.

Loan is due on sale, title transfer, first mortgage repayment, or in 30 years.

Refinancing of first mortgage is allowed by HCIDLA under certain conditions.

DOWNPAYMENT REQUIREMENT  A minimum of one percent (1%) of the property purchase price is required as down payment. The one percent (1%) must come from the Borrower’s own funds. Please be aware that the Borrower may be required to contribute more than 1% of their own funds towards the down payment to complete the purchase.

ELIGIBLE PROPERTIES    

Property must be located in the City of Los Angeles.

Approved short sales/pays, Foreclosed and REO Properties and Regular Sales.

One unit, single family residences including town homes and condos.

Property cannot be occupied by tenants.

 All properties applying under the LIPA program will be inspected by HCIDLA. HCIDLA does not charge for the property inspection. All properties must pass the HCIDLA inspection to be feasible. Any items that are required to be corrected or repaired on the property, excluding up to $5,000 for paint stabilization, will need to be done either at the cost of the owner or the homebuyer and must be completed before the HCIDLA application is submitted to HCIDLA.

18 LIPA Rev: 4.17.14

HOW DOES THIS PROGRAM WORK? HCIDLA provides purchase assistance up to a maximum of $60,000. HCIDLA’s loan provides the difference between the purchase price plus closing costs (up to 5% of sales price) and the amount of the buyer's first mortgage loan, down payment and other funding sources. In addition to the Purchase Assistance Loan, HCIDLA will lend the Buyer funds for lead-based paint stabilization (if needed).

Example: Purchase Price of Home: Buyer's Closing Costs: TOTAL FUNDS NEEDED:

$295,000 $ 9,000 $304,000

Funds Available: First Mortgage Amount (for which buyer qualifies): Homebuyer Down Payment (1% of purchase price) HCIDLA Purchase Assistance Loan TOTAL FUNDS AVAILABLE:

$241,050 $ 2,950 $ 60,000 $304,000

Total HCIDLA loan in the above example is $60,000.

HOW DO I START? Contact one of HCIDLA’s Participating Lenders listed at the end of this publication to get pre-qualified for a first mortgage and HCIDLA loan.

As a covered entity under Title II of the Americans with Disabilities Act, the City of Los Angeles does not discriminate on the basis of disability and, upon request, will provide reasonable accommodation to ensure equal access to its programs, services and activities.

LIPA Rev: 4.17.14

19

PURCHASE ASSISTANCE FOR NEIGHBORHOOD STABILIZATION PROGRAM (NSP) HOMES The City of Los Angeles Housing and Community Investment Department (HCIDLA) offers purchase assistance financing to eligible low- and moderate-income homebuyers seeking to purchase an eligible home from Restore Neighborhoods LA, Inc. (RNLA). HCIDLA provides assistance in the form of a deferred loan for purchase assistance (acquisition, down payment and closing costs).

Using NSP funds allocated to HCIDLA from the U.S. Department of Housing and Urban Development (HUD), RNLA has acquired foreclosed and abandoned single family homes in neighborhoods with the highest incidences of foreclosures: Central, East and South LA, and North and South San Fernando Valley. RNLA has acquired and rehabilitated the houses to sell to eligible homebuyers whose incomes do not exceed 120% of the area median income (AMI). The homes acquired by RNLA have been rehabilitated to meet Code requirements, all major building deficiencies have been addressed, and environmentally responsible “green” building components have been incorporated.

ELIGIBLE PROPERTIES  Homes for sale by RNLA. To view the homes currently available for sale, please visit RNLA’s webpage at www.restoreneighborhoodsla.org  Both one (1) unit and two (2) unit properties sold by RNLA homes are eligible for NSP financing. However, please note that two (2) unit properties will only qualify when both units will be owner-occupied by the Borrowers and the Borrowers’ extended family. HCIDLA does not allow the rental of any unit at any time.

PROGRAM REQUIREMENTS  Borrower must be a U.S. Citizen, Lawful Permanent Resident Alien, or other Qualified Alien.  Applicant may not have any ownership interest in any real property or have any outstanding mortgage obligations at the time a purchase offer is made.  Applicants must attend and complete an eight (8) hour Homebuyer Education Class provided by one of HCIDLA’s Approved Homebuyer Education Providers.  Applicant must occupy the property as their primary residence.  Total household gross income of all adults 18 years of age or older who will be living in the home must be at or below the limits shown on the table below.  Applicant will be required to apply for a Mortgage Credit Certificate (MCC), funds permitting, in conjunction with the NSP/RNLA Program.

Rev: 01.08.14

20

2014 MAXIMUM INCOME LIMITS (as of December 18, 2013) Household Size

1 person

2 people

3 people

4 people

5 people

6 people

7 people

8 people

Low Income

$45,650 or less

$52,200 or less

$58,700 or less

$65,200 or less

$70,450 or less

$75,650 or less

$80,850 or less

$86,100 or less

Moderate Income

$45,651$68,450

$52,201$78,250

$58,701$88,000

$65,201$97,800

$70,451$105,600

$75,651$113,450

$80,851$121,250

$86,101$129,100

HCIDLA NSP LOAN LIMITS Purchase Assistance (acquisition, down payment, and closing costs)

Low Income Up to 80% AMI Up to $60,000

Moderate Income Up to 120% AMI Up to $40,000

HCIDLA LOAN TERMS  Deferred, zero percent (0%) interest, requiring no monthly payments.  Shared Appreciation applies to all loans. For example if a homebuyer receives a $50,000 loan from the City to purchase a home with a $200,000 sales price, the Shared Appreciation percentage would be 25% ($50,000/$200,000). Therefore upon sale, the $50,000 loan plus 25% of the home’s appreciation will be paid to HCIDLA. If the appreciation on the home is less than $10,000, no shared appreciation is due. HCIDLA uses Shared Appreciation in-lieu of charging an interest rate to homebuyers.  Loan is due on sale, title transfer, first mortgage repayment, or in 30 years as a balloon payment.  Refinancing of first mortgage is allowed by HCIDLA under certain conditions.

DOWNPAYMENT REQUIREMENT  A minimum of one percent (1%) of property purchase price is required as down payment. The one percent (1%) must come from the Borrower’s own funds. Please be aware that Borrowers may be required to contribute more than 1% of their own funds towards the down payment to complete the purchase as HCIDLA can only provide ½ of the first mortgage down payment requirement.

MAXIMUM HOME PURCHASE PRICE LIMIT: None HOW DO I START? Contact one of HCIDLA’s Participating Lenders to get prequalified for a first mortgage and HCIDLA’s NSP-RNLA Program. The list of HCIDLA’s Participating Lenders is on HCIDLA’s webpage at http://lahd.lacity.org, Home Buyers, General Information, Resources section. For more information, you may contact HCIDLA at (213) 808-8800.

As a covered entity under Title II of the Americans with Disabilities Act, the City of Los Angeles does not discriminate on the basis of disability and, upon request, will provide reasonable accommodation to ensure equal access to its programs, services and activities.

Rev: 01.08.14

21

CITY OF LOS ANGELES HOUSING AND COMMUNITY INVESTMENT DEPARTMENT (HCIDLA) Mortgage Credit Certificate (MCC) Program Do you want to purchase a home in the City of Los Angeles?

The City of Los Angeles Housing and Community Investment Department’s Mortgage Credit Certificate (MCC) Program can help you achieve homeownership. An MCC increases a borrower’s disposable income by reducing their federal income tax obligation. This tax savings provides a borrower with more available income to qualify for a home loan and meet mortgage payment requirements. In order to participate in the Program, homebuyers must meet certain eligibility requirements, and obtain a first mortgage loan through a participating HCIDLA lender.

What is an MCC? An MCC allows an eligible homebuyer to claim an annual federal income tax credit. This annual credit results in a dollar for dollar reduction which is applied towards the homebuyer’s federal income tax obligation. The MCC credit is either 15% or 20% (depending on property location) and is applied to the total mortgage interest paid every year for the duration of the first mortgage loan.

How does the MCC benefit you?  You will receive a dollar for dollar tax credit which is applied on your Federal Income Tax Return.  The credit amount you receive will qualify you for a larger first mortgage loan.  You can take advantage of the tax credit every year for the life of the original first mortgage.  If you refinance, you are eligible to apply for a Reissued Mortgage Credit Certificate one time.

Example of an MCC: Mr. Jones qualified for a first mortgage loan of $200,000 at an interest rate of 5.00% for 30 years. He purchased a home in a non-targeted area which qualifies him for an MCC tax credit of 15%.

The tax credit amount will be determined as follows:  $200,000 x 5.00% = $10,000 (estimated first year’s mortgage interest)  15% (tax credit rate) x $10,000 = $1,500 (yearly tax credit amount)  $1,500 / 12 months = $125 (monthly funds available for a larger 1st mortgage)  $10,000 - $1,500 = $8,500 (interest paid which still qualifies as an itemized deduction) By adding the MCC credit to the maximum available monthly income for the first mortgage, the purchasing power for Mr. Jones will be increased.

Rev. 4/4/14

22

MCC eligibility requirements You qualify for an MCC if all three of the following are met: 1. First-Time Homebuyer  You must be a first-time homebuyer, which is defined as someone who has not had an ownership interest in a principal residence at any time during the past 3 years. (EXCEPTION: This requirement does not apply to someone purchasing a property in a targeted area.)  The home you purchase will be your primary (year-round) residence.

2.

Income Limit (There are target and non-target areas) Size of Household

3.

Maximum Income

1-2 person(s) 3 or more

15% Tax Credit Non-Target Area $95,220 $109,503

20% Tax Credit Targeted Area* $99,360 $133,308

Purchase Price Limits Existing Housing New Construction

Non-Target Area $673,616 $673,616

Target Area $823,308 $823,308

* Targeted areas can be found in parts of the San Fernando Valley, East and South Los Angeles, and San Pedro.

MCC Program Requirements  Home must be located in the City of Los Angeles.  There is an application fee of $150.  The MCC cannot be combined with the Mortgage Revenue Bond (MRB) Program or the “Extra Credit” for teachers program.  The MCC can be used in conjunction with HCIDLA Purchase Assistance Loans.

How do you apply for an MCC? Start by calling or visiting one of the HCIDLA Participating Lenders listed in this publication or by referring to the HCIDLA website. While the lender is processing your first mortgage application, they will also complete an MCC application and forward it to the City on your behalf. You do not need to submit anything to the City directly. The City will review your eligibility and issue a commitment to your lender before the loan closes. After the City receives your lender's closing documents, the MCC will be issued and mailed to you, along with instructions on how to claim your MCC Federal tax credit.

If you have any questions regarding this program, please refer to the HCIDLA website at http://lahd.lacity.org or call the City of Los Angeles Housing and Community Investment Department at (213) 808-8800.

As a covered entity under Title II of the Americans with Disabilities Act, the City of Los Angeles does not discriminate on the basis of disability and, upon request, will provide reasonable accommodation to ensure equal access to its programs, services and activities.

Rev. 4/4/14

23

Company Century 21-Allstars Procres Inc. Prudential California Realty

Company

Title

Title

LIST OF LAHD PARTICIPATING REAL ESTATE AGENTS/BROKERS

Last Name Avendano Lopez Franco

Realtor Broker Realtor

MOST ACTIVE REAL ESTATE AGENTS/BROKERS First Name Daniel Francisco Martha

Last Name

PARTICIPATING REAL ESTATE AGENTS/BROKERS First Name

Telephone Number Ext (562) 254-2003 (310) 614-7419 (323) 422-6065

Telephone Number Ext

DRE Lic#

01333984 01060471 01717767

DRE Lic#

01335348

01096120 01414098 01469104 01487643 01302960 01857945 01203443 01316372 01855369 00608562 01726552 01761777

(310) 538-8623 (213) 364-3322 (310) 381-9860 (818) 825-6996

(310) 951-5960

(323) 644-9081 (562) 947-7834 (818) 266-3422 (562) 547-9372 (213) 949-9358 (562) 608 5412 608-5412 (562) 682-0333 (323) 463-0910 (310) 337-3007 (818) 381-1829 (818) 518-5008 (310) 233-3930 (818) 599-1444 (310) 722-7940

01727104 01276551 01397008 01479541 01706502 01812487 01235403

Realtor

Real Estate Agent Real Estate Specialist Real Estate Agent/Loan Officer Real Estate Agent/Broker Real Estate Agent Real Estate Agent Real Estate Agent/Broker Real Estate Agent Broker Realtor Realtor Real Estate Agent Real Estate Agent Realtor Realtor Broker/Realtor Real Estate Broker Real Estate Agent/Broker Realtor

107

Bond

01419370 01265638 01706305 01207855 01161196 01786069 01163436

Johnson Monterroza Grecia Oguntomilade Gilkey Wilkinson Jr. Loya Gonzales Callahan Keaton Magee Samuel Magee-Samuel Mariscal Serna Thomas Baptiste Sabbah Alford Manukyan Rath

(818) 770-3663 (818) 207-6337 (661) 212-0739 (213) 399-5499 (818) 822-4754 (310) 529-2152 (213) 910-8316

Kate

Realtor/Broker/Owner Real Estate Agent Realtor Real Estate Agent Salesperson/Realtor Associate Real Estate Agent Realtor

Curtistine Jose Angiloo Bandele Fatrice Richard Alfred Max Matt Deborah Cosetta Amber Martha Tamara Susan Sam Carlos Izabell Stephanie

Alon Griffith Pope Hooks Rodriguez Adewunmi Caro

Remax

Diana Ellen Dana Regina Ramon Tracy Isabel

1st Choice Real Estate & Investments American Team Homes and Investments Belmont Estates Bogun Realty & Luxury Homes BRC Realty Group Inc. Brock Real Estate Centruy 21 Beach Side Century 21 Paul & Associates Civic Center Home Loans & Realty Civic Center Home Loans & Realty ERA Capital Executive Realty Excellence Realty Haus Angeles Keller Williams Larchmont Keller Williams Realty Lifestyle Realty Inc. Professional Realty Prudential California Realty Prudential California Realty Remax Grand Central Remax Grand Central Remax of Santa Clarita RS Cooper & Associates Realty San Fernando Realty, Inc. Zip Realty Zip Realty

Rev: 05.31.10

Please note that any Licensed Real Estate Agent or Broker in good standing may participate with the LAHD Homebuyer Programs. The list above includes Real Estate Agents and Brokers who represented homebuyers that purchased a home under LAHD's NSP and LIPA programs during the last 6 months. Please note that LAHD does not endorse or recommend any particular Real Estate Agent or Broker.

It is the responsibility of the Homebuyer to select a Real Estate Agent/Broker of their choosing and based on their own due diligence.

The information above may not be exact, correct, or current.

To find out how you can be placed on this list, please contact LAHD at 213-922-9672.

24

HCIDLA Participating Lenders

MOST ACTIVE LENDERS Lending Institution

First Name

Last Name

Telephone Number

21st Century Home Loans

Michelle

Scott

(310) 704-6596

Best Capital Funding

Matt

Callahan

(562) 391-6453

Camino Real Mortgage

Ruben

Romero

(818) 365-8768

Citibank

Shalimar

Escobar-Guillen

(562)896-5915

Citibank

Jeanette

Mayes

(818) 687-9935

International City Mortgage

David

McMahon

(310) 502-6355

New American Funding

Shonta

Clark

(424) 354-7411

One Trust Home Loans

Jason

Diez

(909) 321-9165

Prospect Mortgage

Marie

Richarz

(818) 359-4779

Wells Fargo Home Mortgage

Maxine

Avalos

(323) 868-8144

Wells Fargo Home Mortgage

Fernando

Arboleda

(818) 203-1882

Wells Fargo Home Mortgage

Jaqueline

Molina

(818) 808-1021

Ext

PARTICIPATING LENDERS Lending Institution

First Name

Last Name

Telephone Number

Bank of America

Sekou

Doumbai

(323) 200-2586

Best Results Mortgage

Rosemary

Gonzales

(562) 760-1668

Blue Vista Mortgage

Michelle

Ota

(310) 818-0270

Chase

Vanessa

Arellano

(323) 333-2822

First Rate Financial Group

Fred

Gruber

(800) 620-8802

Guild Mortgage

Marco

Flores

(626) 339-4126

iMortgage

Rurik

Madrid

(818) 943-0980

Wells Fargo Home Mortgage

Joseph

Guzman

(310) 379-7376

Ext

101

206

To find out how you can become an HCIDLA Participating Lender, please call (213) 922-9672.

As a covered entity under Title II of the Americans with Disabilities Act, the City of Los Angeles does not discriminate on the basis of disability and, upon request, will provide reasonable accommodation to ensure equal access to its programs, services and activities.

25 Rev. 5/31/14

THE FOLLOWING COMMUNITIES ARE LOCATED IN THE CITY OF LOS ANGELES Angelino Heights Arleta Atwater Baldwin Village Bel Air Bel Air Estates Beverly Glen Boyle Heights Brentwood Cahuenga Park Cahuenga Pass Canoga Park Castellammare Central City Century City Chatsworth Chesterfield Square Cheviot Hills Chinatown Country Club Park Crenshaw District Cypress Park Eagle Rock East San Pedro Echo Park El Sereno Elysian Park Encino Exposition Park Garvanza Glassell Park Granada Hills Hancock Park Hansen Heights Harbor City Harbor Gateway Harvard Heights Hermon Highland Park

Hillside Village Hollywood Hollywood Hills Holmby Hills Hyde Park Jefferson Park Knollwood Koreatown La Tuna Canyon Lafayette Square Lake Balboa Lake View Terrace Lakeside Park Larchmont District Laurel Canyon Leimert Park Lincoln Heights Los Angeles Los Feliz Loyola Village Mar Vista Mid City Miracle Mile Mission Hills Montecito Heights Monterey Hills Mt. Olympus Mt. Washington North Hills North Hollywood North University Park Northridge Pacific Palisades Pacoima Palisades Highlands Palms Panorama City Park La Brea

Porter Ranch Rancho Park Reseda San Pedro Sawtelle Shadow Hills Sherman Oaks Silver Lake South Carthay South Robertson Studio City Sun Valley Sunland Sylmar Sylmar Square Tarzana Toluca Lake Tujunga Valley Glen Valley Plaza Valley Village Van Nuys Venice Vermont Knolls Warner Center Watts West Adams West Hills West Los Angeles West Toluca Lake Westchester Westlake Westwood Wilmington Wilshire Center Windsor Square Winnetka Woodland Hills

Rey County Thomas Guide Map book are located within the City of Los All properties located in the White-Shaded area ofPlaya the LosDel Angeles Angeles. The list above is a general listing of Communities located in the City of Los Angeles. To confirm if a property is located in the City of Los Angeles, please call LAHD at (213) 922-9672.

Rev: 06.16.10

HOMEBUYING TEAM • Housing Counselor A certified housing counselor is a trained professional who works for a nonprofit organization such as a community development corporation, a credit counseling service or a housing agency. The counselor may provide homebuyer education classes, one-onone counseling sessions or both. Because the counselor works for a nonprofit organization and has nothing financial to gain if you buy a home, you can expect objective information and unbiased recommendations. Your counselor can help you learn more about the steps needed to buy a home in your area. She or he can also help you succeed in getting a mortgage loan by making sure you resolve any financial issues before meeting with a lender.

• Real Estate Agent This professional is one of the most important members of your team. A real estate professional is licensed by the state and has been specially trained to sell houses, other buildings and land.

Your agent should:  Talk to you and our family about what you want in a house  Give you information about the neighborhood in which you want to buy a house  Recommend lenders to help you get prequalified or pre-approved so you will know how much you can afford to spend  Research all the homes available in your price range with the features you want  Give you copies of listing sheets that describe houses that fit your needs  Take you to see the homes that interest you  Help you determine how much houses are worth by giving you information about other homes that have sold recently  Help you write the purchase offer in a way that will protect you and is also attractive to the seller  Negotiate (bargain) with the seller to get the best price for you  Help you find a good lender to finance your home  Refer you to other professionals to help with all of the things that happen between the time the contract is signed and the closing, including appraisers, home inspectors, title companies, attorneys and escrow  Explain all the legal paperwork to you so that you understand what you are signing It is important that you work with an agent you respect and trust. A good way to find a real estate agent is to ask people you know and like for recommendations. National real estate companies also have a referral service to match buyers with agents. You can also get a referral from the local Association of Realtors® chapter, as they are members of the National Association of Realtors® and subscribe to a code of ethics.

During your home search, if you feel an agent is steering you away from or toward certain neighborhoods because of your race, religion, national origin or other illegal reasons, the

27

HOMEBUYING TEAM agent may be violating the Fair Housing Act. You should contact the agent’s broker or call the local U.S. Department of Housing and Urban Development (HUD) office for information or to report your experience.

There are several different types of agents:  Real estate brokers have been licensed by the state to own and operate a real estate agency.  Real estate agents have been licensed by the state and works for a real estate broker.

• Lender Most everyone who buys a home gets a home loan, called a mortgage loan, from a lender. Lenders can be banks, savings and loans, credit unions, mortgage companies, government agencies or private individuals.

Getting the Loan You’ll apply for the mortgage loan by completing a formal loan application at the lender’s office. After the lender takes your application, your request for credit is processed and underwritten. These are terms that refer to the work the lender does to decide if you are a good credit risk.

• Housing Inspector It would be great to get a property inspection before you make an offer on a house so you could determine your offer price based on how much it will cost to make any needed repairs. However, property inspections cost money.

Depending on where you live and how complete an inspection you ask for, the cost can be $200 to $500. For this reason, many contracts are contingent on a home inspection. Contingent means that if the inspection shows major problems, you can get your earnest money back and cancel the sale. If you don’t want to cancel, you can ask the seller to make the needed repairs or give you a credit at settlement for the amount it would cost you to make them.

The seller, however, is under no obligation to do so.

What does a housing inspector check?

A housing inspector checks the structural and the mechanical parts of a property. The inspector then writes a report describing major problems. Here are some items the inspector would check:

Structural • • •

28

Foundation Roof Doors

• • • •

Mechanical Windows Ceilings Walls Floors

• • • •

Plumbing Electrical systems Heating Air conditioning

• • •

Insulation Ventilation Septic tanks, wells and sewer lines

HOMEBUYING TEAM It is the inspector’s job to report everything he or she sees that may be a problem now or in the near future. Use the inspection report to protect yourself against major problems. Don’t expect the seller to make the house look new unless you want to pay the price of a new house.

It is always a good idea to have your own inspector look over your new house. To find a home inspector, ask for a referral from your real estate agent, or call the American Society of Home Inspectors at (800) 743-2744.

• Surveyor A surveyor is a licensed professional who checks the measurements of a property and the land around it. Every property has a legal description that defines the property lines. The survey tells you and the lender how big the property is, if there are any property easements or encroachments, what the placement and dimensions of improvements on the property are, and whether any of the improvements (buildings, fences or other structures) are over the property lines. The buyer usually pays the cost of the survey. Ordering the survey is usually one of the final steps in the purchase process prior to closing.

• Appraiser The appraiser’s job is to determine the fair market value of your house. You do not work directly with the appraiser, although you will pay for the appraiser’s services at the time you apply for the loan. Appraisals for single-family houses cost about $275 to $500.

To determine the fair market value, the appraiser compares the house you want with houses like it that have sold recently in the same area. The physical condition of the house affects its market value, as do special features that other houses may not have, such as a corner lot or an extra bedroom.

• Title Insurance Agent When you buy a house, you will want a title officer to research the chain of title and give you a history of who owned it so you can be sure that the person selling you the house really has the right to sell it. The title officer researches the public records and issues a title report, or abstract, that not only shows the ownership but gives you important information about the property, including:    

Any loans the seller has for which the house is promised as security. These loans have to be paid off before you become the owner, or else you may have to pay them to protect your house.

Any easements or parts of the property you may not be able to use because of buried electrical cables or land set aside for possible street widening.

The amount of the state, city, county, school district or other taxes, and whether they have been paid.

Any deed or zoning restrictions that limit the way the property can be used. For example, you usually cannot raise livestock on a property zoned for residential use.

29

HOMEBUYING TEAM 

Whether the property is part of a homeowners association and the amount of any overdue homeowners’ assessments.

The title officer works for a title insurance company that sells insurance to guarantee that the title report is accurate and that you can rely on it. All lenders require that the buyer pay for a lender’s policy of title insurance that protects the lender if there is an error in the title report.

• Insurance Agent Your insurance agent will usually be happy to visit your new home and recommend how much insurance you should have. Insurance agents can often give you a safety inspection and recommend the proper types of door locks, fire alarms and other safety features. Some insurance companies even offer discounts for installing safety and security features. Choose a reputable company and an agent you are comfortable with and who can explain insurance products and services in a way you understand.

In addition to hazard or homeowners insurance, there are many neighborhoods where special hazard insurance is required by your lender, such as flood insurance when you buy a home in a designated flood plain.

• Escrow Officer Between the date the purchase contract is signed and the date the closing takes place, your sale is in escrow. The person who manages the escrow is the escrow officer, an independent person who works for both the buyer and the seller. The escrow officer keeps the original purchase contract and other documents, holds the earnest money, and makes sure that all the people involved in the sale are doing their jobs. The escrow officer is paid a fee at closing which is usually split equally between the buyer and the seller.

30

Programs & Services Achieve Financial Stability We educate, guide, and help empower participants to better manage their personal finances.

Sit down with a certified Housing and Financial Counselor, and implement a plan to build your assets and wealth.

Reach Homeownership Want to buy your first home, but not sure where to start? Meet with a HUD certified counselor. And attend one of our monthly Homebuyer workshops and learn what it takes to become homeowner.

Prevent Foreclosure

Call us Today for More Information (323) 604-1973 CommunityWealth@elacc.org Visit us at www.elacc.org ELACC is a HUD approved Housing Counseling Agency

Our Foreclosure Prevention Program will help you understand the foreclosure process and workout options.

Together we will advocate for a long term solution with your lender.

Are you paid in cash?

Let us help you organize your finances!

Why Financial Counseling?

Our financial counselors will help you: 

Organize your personal & business finances



Manage your expenses



Improve your credit report



Increase your emergency & savings funds



Prepare & file your income tax refunds



Work towards your financial goals!

East LA Community Corporation (ELACC) is a non-profit community organization that educates, guides, and helps working families and individuals realize their financial dreams.

Through our services, participants learn how to establish savings, build their credit, transition into mainstream financial services, avoid foreclosure, and purchase their first home.

ELACC can help you move from stressful finances to financial wellness!

For an appointment, contact us today!

T: (323) 604-1973 or E: CommunityWealth@elacc.org

9

10

Un Solo Sol Kitchen

1818 E. 1st Street, Los Angeles CA 90033

(323) 269-8680

Latin American Food Vegetarian and Vegan friendly www.unsolosol.com

CD’s 50% descuento todos los Miércoles CD’s 50% off every Wednesday

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Restaurant Santa Cecilia 1707 Mariachi Plaza de Los Angeles Los Angeles, CA 90033

¡Bienvenidos a los Negocios Comunitarios de La Primera en Boyle Heights!

Welcome to the First St. Community Businesses in Boyle Heights!

Plaza del Mariachi de Los Angeles

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Especial: -1 Bag of Chips

$5.50

Calidad y Pres gio

-1 Torta -1 Can Soda

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“Especiales de Lunes a Viernes” 3

¡Tortillas hechas a mano para tacos y platos!

(323) 264-4245

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“Trajes de Charro” www.casadelmariachi.com

Super Tortas Luisito 1908 3/4 E. First St. Los Angeles, CA 90033

(323) 261-8384

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In Boyle Heights from Boyle Heights

11AM to 11PM 11AM to 1AM 11:30AM to 7PM

(323) 262-9787

1843 1/2 E. 1st Street, Los Angeles 90033

OPEN: Mon‐Thu Fri‐Sat Sun

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The future is in your hands!

Saving money is your best friend: Treat it well

during the good times and it will be there to

take care of you during the tough times.

(Wicker, 2012)

Enroll Today!

East LA Community Corporation can

guide you in setting financial goals and

reward you for saving!

Set a Goal

Choose a savings plan

Begin saving towards your goal!

$aving is as easy as 1...2...3!

1. Envision and set your financial goals..

Schedule a financial counseling appointment (323) 604-1973 or at communitywealth@elacc.org

Plan $25

First Month Deposit

$25

$15

Length of Program

12 months

$695

$325

$190

Participant Savings

$147

$77

$55

ELACC Contribution

$20

$20

$20

Financial Education Bonus

$862

$422

$265

TOTAL SAVINGS!

2. Choose from one of our plans to help you reach your goals‌

Desarrollo $50

$45

Monthly Deposit

Progreso

$200

(11 months)

Avance

3. Save towards your financial goals!

$53,000

$59,650

$66,250

$71,550

$76,850

$82,150

You and your counselor will work together throughout the 12 months to track your progress towards your goal. Accounts can be opened using an Individual Taxpayer Identification Number (ITIN).

$46,400

Important: To qualify you must meet these income limits

Household Size Income Limit

This is only a deposit account where you cannot withdraw any funds. There is a limit of 2 accounts per household.

WITH

We aim to help families understand their options and rights during these difficult times. Our experienced counselors will work with each participant and their lender to advocate for a long term solution.

We Are Here to Guide You Call Today for Your Appointment (323) 604-1973 CommunityWealth@elacc.org

ELACC is a HUD approved Housing Counseling Agency