Real Estate Owned SpecialistTM "Supplement Sheet"

HUD Homes www.hud.gov State Marketing and Management Contractors www.hud.gov/offices/hsg/sfh/reo/mm/mminfo.cfm www.hudhomestore.com What is a HUD home? How does HUD end up owning homes? In its role of promoting housing, HUD insures mortgages through the Federal Housing Administration (FHA). When someone with an FHA or other HUD insured mortgage fails to make their payments and can t make arrangements through housing counseling, the lender may foreclose. If the lender meets the requirements, HUD may take ownership from the lender and then attempt to sell it at market value through the HUD home sales program. How the Buying Process Works? There are a few things you need to know up front about buying a HUD home, since the procedures are be different than those used in buying other types of homes. HUD, however, has made the procedure as efficient and convenient as possible. Here are some things you should know: HUD has developed a new disposition structure for the management and marketing of its REO inventory that will streamline its operations, capitalize on the expertise of its potential vendors, and provide flexibility to meet changing market conditions in the REO industry. The key elements of the disposition structure include: Mortgagee Compliance Manager (MCM) Field Service Manager (FSM) Asset Manager (AM) Mortgagee Compliance Manager (MCM) www.hud.gov/offices/hsg/sfh/nsc/mcm.cfm The Mortgagee Compliance Manager (MCM) performs a variety of pre- and post- property conveyance services to ensure that HUD's interests are protected. These services include: reviewing property inspections to ensure the property is in conveyance condition; resolving conveyance exceptions; providing guidance to Mortgagees related to pre-conveyance and post-conveyance responsibilities; and leveraging HUD's software and information systems to execute and complete the tasks within this contract. Field Service Manager (FSM) www.hud.gov/offices/hsg/sfh/reo/mm/mminfo.cfm#field Service Manager Field Service Managers (FSM) are companies that provide property preservation and protection services consisting of, but not limited to, inspecting the property, securing the property, performing cosmetic enhancements/repairs, and providing on-going maintenance. Properties acquired by HUD will be assigned to FSMs. There will be multiple contracts awarded through each HOC, with the FSMs competing for new acquisitions through their respective HOCs.

Asset Manager (AM) www.hud.gov/offices/hsg/sfh/reo/mm/mminfo.cfm#asset Manager The AMs are responsible for the marketing and sale of REO property. Multiple AMs will be contracted to market HUD-owned properties within their selected contract area within their geographic HOC areas. FHA property listings and property agent contact information are available at HUD's new REO listing site, HUD Home Store. www.hudhomestore.com/hudhome/index.aspx Only Registered HUD Real Estate Professionals can show, advertise and submit offers on HUD homes. Homes are secured with a master key system. To register visit: www.hudhomestore.com, click on the link NAID Registration. Questions call 800-CALL-FHA (800-225-5342) Making an Offer on a HUD Home Offers must be submitted by a HUD registered broker through their state marketing and management electronic bidding system. Original contracts must be submitted within 48 hours after acceptance with signatures in BLUE ink to HUD s marketing manager. HUD will pay up to 3% of the bid price in closing cost for any type of buyer, owner occupant or investor. HUD will pay up to 3% of the bid price in commission plus any selling bonus to the HUD registered real estate professionals. HUD Homes are Sold "As Is" HUD makes no warranties, does not guarantee the condition of any home and does not verify that it complies with any local code or zoning requirements. HUD makes no repairs. HUD allows for a home inspection to be performed prior to closing and timeline varies from state to state. HUD Home Sales Contract has no finance contingency or amendments. Buyers must obtain a letter of commitment by a direct lender that in facts intends to lend the money prior to submitting an offer. Earnest Money When you submit a contract, you must deposit earnest money with your agent, usually in an amount of $500 for bids less than $49,999 or $1,000 for offers $50,000 or higher. Make check payable to HUD. Does HUD Finance its Properties For Sale? No, HUD does not make direct loans. Some properties will qualify for an FHA insured mortgage while others will qualify for an FHA 203(k) Streamline mortgage or rehab loan," or HUD s Energy Efficient Program. Closing on a HUD Home Closings are generally within forty five days and held at HUD s designated closing agent s office or sixty five days if the buyer is using the FHA (203k) Streamline financing program. Extensions of Time Extensions for time to close may be granted in fifteen day increments, under certain circumstances and requires extension fees and forms that must be processed five days prior to the expiration of the contract. HUD provides an FHA appraisal, termite letter, home property inspection report and clear limited warranty title. Atlanta Homeownership Center (Effective on bids submitted on or after 12/01/2011)

A broker bonus is being offered in eight market areas: Georgia, Florida, Mississippi, Alabama, Illinois, Indiana, Tennessee, and Kentucky. The following conditions must be met in order for the selling broker to receive the applicable broker bonus. The preliminary bid must be submitted on or after December 1, 2011. A loan commitment letter from a lending institution must be received with the signed Sales Contract if the purchase is to be mortgaged; or, if paying cash, a certification letter must be received from a financial institution stating sufficient funds are available to complete the purchase. The words Broker Bonus must be written or typed at the top of the signed Sales Contract. The selling broker must complete and sign the HUD Notification regarding the broker bonus sales initiative. For all properties that close up to 34 days of contract acceptance, the selling broker will be eligible for a $600 bonus*. For all properties that close within 35 to 39 days of contract acceptance, the selling broker will be eligible for a $450 bonus*. For all properties that close within 40 to 43 days of contract acceptance, the selling broker will be eligible for a $300 bonus*. *Exclusions apply*excludes: Hard-to-sell properties. The selling broker will not be eligible to receive a bonus for any property advertised by the Asset Manager (AM) as hard-to-sell. Properties eligible for $1,250 commission for listing and selling broker, are considered Hard to Sell and not eligible for the broker bonus. Prior to placing a bid, any property deemed hard to sell has a blue icon with a dollar sign in a bubble. Below is a visual of the indicator that is reflected on all hard to sell properties on the Hudhomestore. Note: The Atlanta Homeownership Center will not consider any appeals submitted by the selling broker for properties that fail to close within the aforementioned timeframes. No exceptions. In order for your contract to be eligible for the broker bonus you must have all applicable bonus forms and commitments submitted correctly at time of contract execution. No exceptions. United States of Veterans Affairs (VA) www.military.com VA acquired properties are listed for sale at http://va.equator.com www.homesales.gov The Department of Veterans Affairs (VA) acquires properties as a result of foreclosures on VA-guaranteed and VA-financed loans. These acquired properties are marketed for sale through a property management services contract with Bank America Home Loans previous Countrywide.

The properties are listed by local listing agents through local Multiple Listing Systems (MLS). Properties for sale may also be viewed on www.reotrans.com on a government site at www.homesales.gov. Interested listing brokers and subcontractors may also access www.homeloans.va.gov/faqmisc.htm for information on selling VA acquired properties. Buyers must use a real estate professional to submit an offer on a VA home. VA provides addendums outlining their policy, procedures and timeline for buyer to review prior to submitting an offer. VA s properties are sold as is and does not have a home inspection policy, therefore all buyers must get acquainted with the property prior to submitting an offer. The Veterans Administration website is an excellent resource for detailed information about VA guaranteed home loans. If you cannot find the answers to all of your questions there, be sure to contact your local or regional VA office. Frequently Asked Questions Veterans Administration www.homeloans.va.gov/new.htm How do I find out how to purchase a VA owned property? Bank America Home Loans is VA's service provider who lists and sells VA acquired property. Where can I find lists of VA homes available for sale? Please go to https://va.equator.com/index.cfm? American Home Loans website is under development for VA acquired property. VA offers 3% selling commission. Amount of earnest money deposit is 1% of the purchase or $500, whichever amount is greater. Properties are Will VA finance the purchase of a VA owned property? Yes, vendee financing (i.e., seller-financing) is available for most, but not all, property sales. With vendee financing the downpayment requirements are very reasonable, and the interest rate is established by VA based on market conditions. Any prospective buyer who requests VA financing to purchase a VA owned property must have sufficient income to meet the loan payments, maintain the property and pay all taxes, insurance, utilities and other obligations, and acceptable credit. The buyer must also have enough funds remaining for family support. Do I have to be a veteran to purchase a VA owned property? No, all VA properties are available for sale to both veterans and non veterans. VA Vendee Financing VA has re-opened Vendee Financing to purchasers of Vendee eligible VA REO Properties. Vendee financing is a loan product offered to veterans and non-veterans to help finance the purchase of VA REO Properties. Some of the Guidelines Are Listed Below Seller may contribute up to six percent of the contract sales price to pay for funding fee, closing cost, prepaid and other expenses Vendee mortgages are assumable by qualification

Vendee financing requires a 620 credit score Available terms of 15, 20, 25 and 30 year fix rate Interest rates are determined by the VA Mortgage insurance is not required Tax service fee, appraisal fee, flood certification or prepayment penalty are not required Owner Occupied Purchase Amount financed with as little as 0% down The loan amount may be increased up to 2% to finance closing costs, pre-paids or other expenses The funding fee may not be financed Non-owner Occupied Purchaser (Investor) Amount financed as little as 5% down Investors may use 75% of anticipated rent based on appraiser's estimate to offset against the subject property monthly payment Investors must have experience managing rental properties to include anticipated rent on subject property in underwriting No maximum number of investment properties VA Vendee Financing Details VA properties are sold "as is" condition Closing fee is $500.00 plus normal closing fees A $350 loan application fee is also required - Vendee Loan Pre-approval letter and proof of funds for your down payment and closing cost with offer For VA Vendee Financing, you will need to provide a recent original pay stub, recent bank statement showing that you have funds available to close, signed copies of your federal tax returns for the past two years. If self-employed, in addition to the tax returns, you will need a year-to-date profit and loss statement, prepared by an accountant. No financing or inspection contingencies when purchase a VA-owned property The buyer will have 10 days to provide all necessary documents for processing Closing timeline is 30 days To view VA REO Properties, visit: https://va.equator.com/index.cfm? To talk to a VA Vendee Financing Representative: 800.816.4346 To become a listing broker contact: rembrokercommunication@bankamerica.com Freddie Mac's REO Program www.homesteps.com Freddie Mac is the second largest secondary mortgage market, chartered by Congress with a mission to promote affordable housing. As a market maker, Freddie Mac purchases loans made by banks and mortgage companies.

As the investor behind these loans, Freddie Mac has certain rights including the right to take ownership of the property to protect their interest following a foreclosure. Freddie Mac was established by Congress in 1970 to provide liquidity, stability and affordability to the nation's residential mortgage markets. Freddie Mac supports communities across the nation by providing mortgage capital to lenders. Over the years, Freddie Mac has made home possible for one in six homebuyers and more than five million renters. HomeSteps is the REO division of Freddie Mac, the Federal Home Loan Mortgage Corporation. HomeSteps homes were originally purchased with conventional financing under $417,000. Home Warranty Incentive HomeSteps offers an allowance up to $500 to homebuyers towards the purchase of a home warranty of their choice. Freddie Mac First Look Initiative Freddie Mac will offer homebuyers and select non-profits an exclusive opportunity to purchase HomeSteps homes prior to competition from investors through the Freddie Mac First Look Initiative. This on-going initiative offers owner occupant homebuyers, Neighborhood Stabilization Program (NSP) grantees and nonprofits engaged in community stabilization efforts the ability to purchase HomeSteps homes during their initial 15 days of listing (30 days in Nevada), without competition from investors. The purchaser does not need to be a first time homebuyer to be eligible provided, however, that they are buying the home as their primary or secondary residence. During the first 15 days of the listing, the property is available only for a primary residence purchase. HomeSteps Home Search - www.homesteps.com/featuresearch.html www.fanniemae.com Fannie Mae is a government-sponsored enterprise (GSE) chartered by Congress with a mission to provide liquidity, stability and affordability to the U.S. housing and mortgage markets. Fannie Mae operates in the U.S. secondary mortgage market. Rather than making home loans directly to consumers, they work with mortgage bankers, brokers and other primary mortgage market partners to help ensure they have funds to lend to home buyers at affordable rates. They fund their mortgage investments primarily by issuing debt securities in the domestic and international capital markets. First Look for Fannie Mae Homes Fannie Mae's First Look is designed to provide neighborhood stabilizing entities owner occupants, public entities, non-profits and similar organizations a first look at Fannie Mae homes. Under this policy, Fannie Mae will only consider offers from owner occupants and buyers using public funds during the First Look marketing period, typically the first 15 days a property is listed on HomePath.com. If the property is still for sale after the First Look Marketing period expires, investor offers may be submitted and will be considered. HomePath.com marks each property with the logo during the First Look Period. Once the First Look marketing period has expired, consideration is given to investor offers.

If you are concerned that the First Look marketing period is not being handled appropriately on a particular property, please contact the Fannie Mae Resource Center immediately at 1-800-732-6643. If an investor submits an offer during the First Look marketing period, the offer will be rejected by Fannie Mae, but the investor may resubmit their offer on the 16 th day if the property remains actively listed. Properties in the First Look marketing period will have a timer with the number of days remaining on the property details page. Ask a Fannie Mae listing broker for more information. Make an Offer Online Making an offer to purchase a HomePath property is now quick, easy and entirely online! Beginning February 2, all offers on HomePath properties* must be made using the HomePath Online Offer system. If you're ready to make an offer, just have your real estate professional click the "Make an Offer" button on the property information and follow the instructions Improved Properties Sometimes HomePath properties receive repairs and improvements before they are listed for sale. National and local vendors provide services to Fannie Mae, improving items such as flooring and paint. You can easily identify the properties that have had improvements they will be noted by one of the two symbols below. Properties with this logo have had certain repairs performed by The Home Depot as a preferred repair contractor for Fannie Mae. The Home Depot offers a one-year limited warranty on all repairs it performed. Properties with this logo have had certain repairs performed by Fannie Mae-approved repair contractors. Please keep in mind that Fannie Mae may not repair or replace everything in a home - we always strongly recommend that buyers hire an independent home inspector prior to purchase to identify any areas that may be of concern. Fannie Mae sells its properties "as is" and is not responsible for fixing problems after a transfer of ownership www.homepath.com This special financing is available on Fannie Mae homes. Free flyers and sign riders. Other benefits include: Available to both owner occupiers and investors Minimum 5 percent down for primary residence, 10 percent down investment property Down payment (at least 3 percent) can be funded by your own savings; a gift; a grant; or a loan from a nonprofit organization, state or local government, or employer Flexible mortgage terms (fixed-rate, adjustable-rate, or interest-only) High balance (jumbo) and interest only products available Borrower can own up to ten financed properties (but need 25 percent down if they own more than 4)

You may qualify even if your credit is less than perfect Seller contributions can be 6-9 percent on primary residence (the larger the down payment, the larger the allowable contribution), only 2 percent on investment property Same basic underwriting requirements of a conforming loan, but without the property issues (appliances missing - no problem) No mortgage insurance No appraisal fees Properties are also eligible for HomePath Renovation Mortgage HomePath Mortgage financing is available from a variety of lenders HomePath Protection is offered through Old Republic Home Protection Services and consists of the Old Republic Home Service Contract and HomePath Protection Plus www.orhp.com/homepathprotection Investor If you're an investor interested in renovating a property, you may qualify for financing under the HomeStyle Renovation Mortgage product. Sign Up For News Alerts: http://fanniemae.hosting.exacttarget.com/homepath_profilesubmit.html Submitting an Offer for Fannie Mae-owned (HomePath ) Property Fannie Mae aims to work with real estate professionals and sell foreclosed properties in a manner that is similar to a traditional home sale. Skillful negotiations produce timely property sales that best preserve neighborhood values and maximize the benefits to all parties involved. We expect our listing brokers to be professional and responsive to agents requests for information and offers. To that end, the HomePath sales process helps streamline all efforts. HomePath properties must be in MLS for a minimum of three (3) calendar days before an offer can be negotiated with an eligible buyer. Offers received prior to the date that represents Day 4 in the MLS are rejected. Selling agents are informed and advised to resubmit offers at the appropriate time. Only complete offers will be considered. Complete offers include the state-specific contract signed by the buyer; and the Fannie Mae Purchase Addendum outlining the terms of sale. Agents may wish to review the document to become familiar with the terms before representing a buyer s offer. Some items to note in the Addendum: Fannie Mae pays usual and customary selling closing costs and fees, which may include all or a portion of the title insurance and settlement fees. Fannie Mae will either pay usual and customary costs or a portion of the costs for realty transfer taxes in states that don t recognize its exemption status as a congressionally chartered corporation. Fannie Mae requires that earnest money accompany the offer package. To determine the appropriate earnest money deposit, we will consider the following: An amount that is reasonable and customary. At least ten percent (10%) but no less than $1,000 deposit on cash transaction. Waived earnest money deposit for public entities and a $500 deposit from owner occupants using HUD s Neighborhood Stabilization Program funds. While not required, mortgage prequalification letters help ensure prospective buyers qualify for financing, saving all parities both time and effort, and should be included in the offer package.

The listing agent notifies all parties when a multiple offer situation exists. Selling agents should present highest and best offers by the date and time specified using the standard Fannie Mae multiple offer form. Fannie Mae considers the following factors when assessing highest and best : A preference for owner-occupants and public entity purchasers who tend to provide neighborhood stability An offer contingent on the sale of another home will not be accepted No preference for cash versus financed sale Once Fannie Mae has reviewed all offers, a decision is shared with the listing agent who in turn notifies all parties involved. Barring any errors or omissions, contracts are signed and returned to the listing broker within two (2) business days. The listing broker will distribute the executed contract to all parties including the buyer s settlement agent. For more information about submitting an offer for a Fannie Mae-owned property, please refer to The Buyers Guide. To view and download a free copy, go to www.homepath.com and click on the Resource tab. Federal Deposit Insurance Corporation www.fdic.gov 800-568-9161 FDIC Listings Prescient Asset Management http://www.fdiclistings.com http://www.4prescient.net/fdicore.aspx - Become a broker Each property will have a contact name and phone number for information Listings are updated each Monday Properties are sold as is Pricing is established by independent appraisals, BPOs and current market condition Special sale events visit: http://fdiclistings.com/propert_view.aspx?propertyid+2902 Bargain properties visit: www.fdic.gov/buying/owned/bargain/index.html FDIC Real Estate for Sale: http://orelistings.cbre.com or www.fdiclistings.com FDIC Exhibit A Property Description FDIC Attachment B Purchaser Eligibility Certification FDIC Attachment C Confidentiality Agreement (Property Sales) Evaluation Material Form Strictly confidential Must be returned to FDIC Effective date will be the date upon which the last party to sign executes the contract Purchase over $25,000 requires earnest money equal to the greater of five percent (5%) of the purchase price or $2,000 cash, a cashier s check or certified funds payable to Seller FDIC will provide the buyer a title commitment from a title insurance company chosen by Seller at closing Inspection period is allowed. A copy of every report of every test and inspection will be delivered to the Seller within five (5) after report has been received by buyer.

FDIC pays some closing cost i.e. attorney fees, one half of escrow fees, title policy, preparation of deed If FDIC fails to perform any of its obligations; earnest money will be returned, reimbursement by FDIC of purchaser s documented out-of-pocket expense, not to exceed $1,000 Cathy McDaniel 404-550-0775 Cathy@cathymcdaniel.com www.cathymcdaniel.com www.americanreu.com