The PickA Payment Loan

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The Pick-A- Payment Loan

• Investor Mortgage Corp.

Its the only Loan we offer because it is the
only loan you need.
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Are You A Typical Borrower?

• Is there a typical borrower?
• Every borrower is unique with different needs,
  goals and lifestyles.
• More Self Employed people
• Frequent job/career changes
• Baby Boomers or Generation X
• Kids, Kids, Kids
• Layoffs
• Low consumer confidence
• Hugh Student Loans

Todays Borrower is anything but
TYPICAL
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However, you have some things in common

• How much credit card debt
  do you have?
• What do you have put away for retirement?
• What do you have put away for their kids college
  education?
• What is currently happening to your
  investments?
• Who wants so much debt and so little savings?

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You Need a Plan

• Financial Freedom
• Less credit card debt
• More Savings
• Their Dream House

But with a fixed rate, I wont have to worry
about my mortgage and I can concentrate on
solving the above problems. Right?
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But what is left?
A Typical Borrower Balance Sheet
Pay Credit Card Debt Save for Retirement Save for
College Buy a car/Not lease Go on vacation
Mortgage
It is a necessary evil that is fixed but
provides no flexibility. Pay it first and
whatever is left over is used to
Once the mortgage is paid, what is typically
left over? Not Much!
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Todays Balance Sheet
Your Mortgage
CC Debt Retirement College
Vacation
How much disposal income do you have after you
pay all of the above each month? Under this plan,
consider your return on investing your 401K ,
stock, or childs college fund for several years.
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Stop using fixed rate mortgages or adjustable
rate mortgages there is no future in it.

• Use your mortgage as the foundation of your plan.
  
• Consult with a financial planner.
• You can use your mortgage to contribute to
  investment accounts.
• Learn all you can about wealth management.

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Roll atop the ebbs and swells of the economy
with a plan and a little security !
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Pick- A-Payment Loan

• Solve Your Financial
• Problems Today and Guarantee your Tomorrow

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Which Interest rate do you want?

• 6.50

Fixed cost, pay more interest over the life of
the loan, have no flexibility
or

• 6.430

Make a return on investment and/or payoff other
consumer loans
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Which Payment do you want? (based on a 500K
loan amount)

• 2,166
• 1,567
• 1,337
• 962

Are you saying I actually have a choice of
mortgage payments?
ABSOLUTELY!
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The Pick A Payment Loan

• Initial Interest Rate 2.30
• You can choose up to 4 monthly payment options
• 1,567
• 5.25 fully amortizing mortgage
• 1,337
• Interest only payment
• Generates extra cash flow
• 962
• Minimum payment determined by lender
• Generates maximum cash flow
• 2,166
• 15 year payment option
• Builds equity quickly
• You are in control. You decide your mortgage
  payment based on your personal needs.

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Sounds too good to be true, whats the catch?

• Your payment options may change slightly from
  year to year
• Upwards- Roughly 40 per 100K (ex 250K 100)
• Downwards- No limit on decrease
• Why will this happen?
• Your interest rate may change by a few
  hundreds/thousands of a each month.
  Why????........

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COSI- Cost of Savings Index
6.420
2.30- Flexible
3.45- Fixed

• How high (or low) can COSI go?
• Do you have a checking account?
• What interest rate do you earn?
• Do you have a savings account?
• What interest rate do you earn?
• Do you have any money in CDs?
• Why or why not?

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Deposit Account Facts
Why do you use Checking/Savings Accounts? For
Convenience and Storage of money Why do (or
dont) you have Certificates of Deposits? They
are conservative, safe and Federally Insured
investments. They provide low risk but also low
return.
What is a bank going to pay you for convenient,
safe, and conservative investing?
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What is COSI?

• The weighted average of checking, savings and CD
  rates the bank pays their depositors.
• Taking an average of safe, conservative and low
  risk money makes COSI very stable predictable

.7 .8 1.4 1.6 1.8
2.5 3 1.3 .4 1 1 1.7
2.4 .3 3.6 .9 1.1 1.7
2.5 2.4 2.6 .6
World currently pays customers an average of
1.85 to invest money in checking accounts,
savings accounts and CDs
Avg. 1.85
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Where is COSI going?

• COSI- 1.85
• Comprised of 80 Billion worth of Checking
  Accounts, Savings Accounts and variable maturing
  CDs.
• Todays Rates Checking-
• Savings-
• 1 yr. CD-
• 2 yr. CD-
• 5 yr. CD-

.21
Current Rates

1.31
Existing Deposits
2.15
COSI (2.97)
3.21
80 Billion Pool
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Who cares about low rates when you can get these
great gifts for opening a checking acct.
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What else keeps COSI stable?

• Competition
• Banking competition has decreased. There are
  less banks than ever before. If you dont have
  banks competing for your money, they have no
  reason to pay you more. Basic supply demand
• Baby Boomers
• As more and more baby boomers enter their 50s
  and 60s they will begin putting their money in
  safe investment vehicles (CDs). If banks know
  they are going to receive this money, they have
  no reason to pay you more (see competition)
• Inflation/Good Economy
• Rates will certainly go up, but banks raise rates
  slowly even in good times. In addition, all your
  other investments would be gaining. An increase
  in your mortgage payment would be offset by a
  great stock market, appreciation, and consistent
  pay increases.

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How can I feel comfortable I will always be able
to afford my mortgage payment?
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Annual Payment Cap
Payment Protection

• The Pick A Payment loan has a 7.5 annual payment
  cap
• Your payments can never go up by more than 7.5
  per year
• That equals about 40 a year max per 100K of
  loan amount.
• For example
• 1st year pmt 1,047
• Maximum 2nd year pmt 1,125
  (1,047 x 7.5 1,125)
• There is no payment floor

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Equity ProtectionThe Equity Builder Option
Our Conventional Loan
1000
1000
1
30
60
Our Equity Builder Loan
500
500
500
1
500
14
28
42
56
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Why is this important

• It is not your payment that matters, but how
  its applied
• The Equity Builder
• Is the only loan that amortizes your loan every
  14 days (vs. 30)!
• Reduces your principal balance every 14 days!
  (Time Value of Money)
• Means you will pay thousands less in interest!
  (The less time you owe, the less you pay in
  interest)
• Will reduce your term by 6-8 years creating the
  ability to move up more quickly!
• Is a forced savings plan to an on time retirement

Less Interest Low Cost Lower Balance
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Fixed Rate Option
Peace of Mind Protection

• Allows borrower to convert to a fixed rate
• Take cash flow today, lock in to a fixed rate
  tomorrow
• When can they convert?
• Years 4-7 (2-7 if par program)
• What rate will they lock?
• FNMA 60 day rate 55 bps.
• How do they lock?
• Call 800 number to get quote
• How much does it cost?
• 5 bps increase in margin today
• 200 fee at conversion

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Equity Line of Credit
Rainy Day Protection

• Access money in the future in case of
  emergencies.
• Concurrent ELOC
• Offered as a 2nd mortgage on EVERY 80/10 or 75/15
  or 70/20
• Necessary part of the transaction
• Optional ELOC
• Offered up to 90 CLTV on most transactions
• Rates as low as prime 2
• 30 year term w/..
• 10 year interest only option
• Lender pays most of the closing costs

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Potential Questions

• How high can my interest rate go?
• Answer COSI has a lifetime cap of 12.95. In
  order for that to happen checking, savings and
  CD accounts would need to average 9 over a long
  period of time.
• How is the payment for my minimum payment
  option determined?
• Answer The minimum payment is determined by the
  lender. The payment is currently based on an
  effective rate of 2.30.

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How do I select my initial payment? Answer You
will be asked to fill out a Request for Initial
Payment form at application. Simply request the
minimum amount you would like to have the option
to pay. Your loan consultant can calculate your
minimum payment options.
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• Once I choose my minimum payment, can I change my
  options from month to month?
• Answer Yes. Each month you can choose a payment
  at or above the minimum payment you selected at
  application.
• Example At application you chose the minimum
  payment option calculated at 1.95. Each month
  you can elect to make that payment or a higher
  payment
• Example 2 At application you chose the Interest
  only payment. Each month you can elect that
  payment or higher. You could not elect the
  minimum payment calculated at 1.95.

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• If I choose the minimum payment each month, will
  negative amortization occur?
• Answer Possibly. If your minimum payment does
  not equal your full interest owed, the interest
  still owed would be added to your principal
  balance.

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I can get a 5/1 Jumbo Arm at 6.50 so why get
this loan?

• Loan Amount 500,000
• 2.30 PAP 6.5 5/1 Savings
• Yr 1 962 3,160 2,198
• Yr 2 1,034 3,160 2,126
• Yr 3 1,111 3,160 2,049
• Yr 4 1,195 3,160 1,965
• Yr 5 1,284 3,160 1,864
• Yr 6 1,381 3,160 1,779
• So why not invest 143,772 over 6 years and
  build up your 401K accounts?.

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• Should I avoid a loan with negative amortization?
• Answer Absolutely not! Keep in mind your
  minimum payment options are just that.options.
  You can elect to pay the full amount owed at any
  time. However, if you are similar to millions of
  others, you may find a better use for your money
  (cc debt, college fund, invest in stocks/MFs,
  etc.). The option is yours!

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Pay off Credit Card Debt
Assumptions 300,000 Sale Price 10 down
15,000 credit card debt

• 6 Fixed Rate w/ MI.
• PI MI 1,736
• CC Pmt 230
• Total Pmt 1,966
• Mtg/Credit Card Balance
• Yr. 1 267K 14.9K 282K
• Yr. 2 263K 14.8K 278K
• Yr. 5 251K 14.5K 265K
• Yr. 10 226K 13.3K 239K
• Yr. 20 146K 3.4K 149K
• Credit card debt paid off in 21 years.
• Mortgage paid off in 30 years.
• Interest Paid

• 5.25 Pick A Pay (80/10)
• PI (1st 2nd) 1,282
• CC Pmt 684
• Total Pmt 1,966
• Average 3 yr. payment
• Mtg/Credit Card Balance
• Yr. 1 270K 9K 279K
• Yr. 2 270K 1.8K 272K
• Yr. 5 242K 0K 242K
• Yr. 10 182K 0K 182K
• Yr. 20 0 0 0
• Credit card debt paid off in 2.2 years then began
  applying 1966 to mortgage. Mortgage paid off in
  20 years.
• Interest Paid
• Credit Card debt 3K over 2.2 years
• Mortgage debt 181K over 20 years

Total Possible Savings 172K
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• Is this loan too complicated?
• Answer Absolutely not! Keep in mind, there is
  no such thing as a typical borrower. You
  understand the value of a dollar and appreciate
  choices in life. Life is not FIXED anymore.
• Ask yourself these simple questions

• Do you know what a savings account is?
• Do you know what a CD is?
• Would you like a loan that is tied to the most
  conservative, safest money in the market place?
• Would you like to control your mortgage?
• Would you like a mortgage that gives you a below
  market interest rate?
• Would you like a mortgage that gives you the
  option to choose your mortgage payment?
• I notice you have credit card debt. Can I show
  you a mortgage that will eliminate your debt and
  possibly save you hundreds of thousands of
  dollars over the life of your loan?

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This makes the traditional 30 year traditional
loans Obsolete for todays realty

• Below market interest rate
• Option to pay below the below market interest
  rate
• Fixed Rate Stability
• Access to Emergency Funds
• Guaranteed Payment Protection
• Rapid Amortization (EB)