First Time Homebuyer Education Course Standards

1
First Time Homebuyer Education Course Standards

• Utah Homebuyer Education Coalition Standardized
  Curriculum

2
Asset-Based Lending

• A lender provides financing to a homeowner based
  on the equity and without regard to the
  borrowers ability to repay the loan. The lender
  determines that there is equity enough to cover
  any loss that might incur in the event of default.

• Prevention
• Are you ready to buy a home
• Managing you money
• Getting a mortgage loan
• Keeping your home ....

3
Equity Stripping

• Prevention
• Managing your money
• Keeping your home .
• Understanding credit
• Are you ready to buy a home
• Getting a mortgage Loan

• The lender encourages to borrow against the
  equity as an easy way to get additional money
  consolidate debt, home repairs.

4
Mortgage/Loan Flipping

• Prevention
• Managing you money
• Getting a mortgage loan
• Keeping your home and managing your finances

• Repeatedly refinancing loans with no tangible
  benefit to the consumer. Equity is stripped from
  the borrower with each refinance by charging high
  closing costs and prepayment penalties.

5
Bait-and switch schemes

• The lender may promise one type of loan or
  interest rate, but without good reason, gives the
  borrower a different one. Sometimes a higher
  interest rate or an adjustable rate doesnt kick
  in until months after settlement.

• Prevention
• Getting a mortgage loan
• Shopping for a home
• Keeping your home and managing your finances

6
Balloon Mortgage

• A balloon mortgage has payments based on a
  30-year amortization schedule with the unpaid
  principle balance due in a lump sum at a
  specified time, generally five to seven years.

• Prevention
• Are you ready .
• Getting a mortgage loan
• Shopping for a home
• Keeping you home

7
Property Flipping

• Rapid resale of a property at a higher than
  market value using a phony appraisal. May include
  a second mortgage payable to the seller and
  forged or false loan documents.

• Prevention
• Shopping for a home
• Getting a mortgage loan

8
Packing

• The borrower gets a loan that has charges for
  services the consumer does not request or need.
  Packing most often involves the forced purchase
  of insurance, such as credit life or unemployment
  insurance.

• Prevention
• Getting a mortgage loan
• Shopping for a home
• Keeping your home .

9
Steering

• Some real estate professionals steer their
  customers to a certain business or person such as
  a mortgage broker, real estate agent, builder or
  title company.

• Prevention
• Are you ready to buy a home
• Getting a mortgage loan
• Shopping for a home

10
Foreclosure Rescue

• Homeowner who faces foreclosure deeds his
  property to a third party, usually in exchange
  for the balance of the loan. The homeowner
  becomes a renter, and is offered to purchase the
  property back for a much higher price.

• Prevention
• Managing your money
• Understanding credit
• Getting a mortgage loan
• Keeping your home and managing your finances