Oregon Housing and Community Services

1. Oregon Housing and Community Services Single Family Finance Section Phone: 877-788-2663 www.oregonbond.us

2. Oregon Housing and Community Services • Oregon’s State Housing Finance Agency (HFA). • Assists non-profit and for profit developers build affordable multi-family housing in Oregon. • Administer federal housing & anti-poverty programs in partnership with a variety of agencies. • Sell tax-exempt bonds to purchase single and multi-family housing loans. • Home of the “Oregon Bond Home Loan” and the Purchase Assistance Loan (PAL). • We are also a main sponsor of the Regional Housing Centers.

3. Oregon Bond-2005 Borrowers • Served 1171 low and moderate income households. • 98% served were first-time homebuyers. • Over 70.5% of the households had household incomes at or below 80% of the state or area median income. • Average household income was less than $45,000. • Average loan size in 2006 increased by 13.8% to $153,294. • Average borrower age was 34. • Average household size was 2 persons.

4. Oregon Bond Benefits • We can provide your clients access to an on-going supply of below market rate home loans and closing cost assistance for households up to 100% median income. • We can help you serve more clients by increasing their purchasing power or they might buy more house! • It’s a great way to build life-long relationships with your clients! They may even tell their friends and family. • We also offer 90 day rate locks for existing homes and 120 rate locks for newly constructed homes and no lock fees. No need to worry about rates going up!

5. Includes 3% Cash Assistance to pay closing costs, pre-paids or under certain conditions down payment. .50% higher than the RateAdvantage option 30 year fixed No secondary liens Cash assistance is like a grant No Prepayment Penalty Less cash needed to close Below market rate 30 year fixed rate Compatible with gifts, grants, and DPAs Assumable Maximum purchasing power No Prepayment penalty Cash to Close or Great Rate?CashAdvantage RateAdvantage

6. Oregon Bond-Borrower Qualifications • First-time homebuyers: May not have owned or occupied a home in last three years (unless purchasing in a targeted area). • Household income limit (100% of state median or higher in high cost housing areas) $58,900 statewide; $72,892 for Portland Metro; $68,100 for Benton County; $65,274 Deschutes County; and $63,480 Jackson County. • Must occupy as Primary Residence.

7. Oregon Bond Purchase Limits • OHCS has established Purchase Price Limits which are governed by the Internal Revenue Service (IRS). Depending on the location of the home being purchased, the Purchase Price (Acquisition Cost) Limits are listed below: County Non-Targeted Area Targeted Area • Benton $276,750 Not Applicable • Clackamas $337,026 Not Applicable • Clatsop Not Applicable $316,250 • Columbia $337,026 $411,921 • Deschutes $353,250 Not Applicable • Jackson $326,131 $398,605 • Josephine Not Applicable $357,355 • Lane $253,125 $309,375 • Lincoln $249,750 Not Applicable • Multnomah $337,026 $411,921 • Tillamook $267,750 Not Applicable • Washington $337,026 Not Applicable • Yamhill $337,026 Not Applicable • All Other Counties $237,031 $289,705 • If the county is not specifically listed, use the “All Other Counties” limits.

8. Oregon Bond-Other Requirements • Must meet applicable mortgage insurance requirements or other lender requirements. • Bankruptcy must be discharged at least two years prior to closing the program loan. • Foreclosure or deed-in-lieu of foreclosure must be at least five years prior to loan closing the program loan.

9. Oregon Bond-Program Compatibility • Compatible with FHA, USDA Rural Development and, Conventionally Insured Loans (97% LTV). • May be used with all types of secondary loan products, gifts, and other Down Payment Assistance Programs (DPAs). • Compatible with PAL, Home Purchase Assistance Program, Home$tart Program, Individual Development Accounts, Section 8 Housing Choice Vouchers, and city or county funded DAPs. • Compatible with the Home-Ownership Opportunity Program (HOOP) loan too!

10. Oregon Bond-Fees • Combined Loan Origination & Discount Fee may not exceed 1.75% of the loan amount. • Total of the Document Preparation, Processing, Underwriting or other similar fees may not exceed $490. • Other standard third party fees that are usual and customary are acceptable.

11. Oregon Bond-Eligible Properties • Single-family homes (1 unit) in Oregon. • Purchase price must not exceed applicable limits (higher limits for targeted areas). • All types of single-family homes qualify (except for manufactured homes in parks). • Must also comply with Mortgage Insurance property standards such as FHA Minimum Property Standards.

12. IRS Recapture Tax • The purpose is to assure the lower rate benefits low to moderate income families. • Tax only applies if the home is sold within the first nine years of ownership. • Tax is applicable only if borrowers’ income at time of sale exceeds an income threshold which is significantly higher than the current income limit. • Tax could never exceed 6.25% of the original loan amount but is significantly reduced if home is sold in any year other than the fifth year of ownership.

13. Who Collects the Tax? • Tax is paid to the IRS (not the state). • IRS Form #8828 is filed with a borrowers’ 1040 Federal Tax Return for the tax year in which the home is sold. • Lender is responsible for disclosing this potential tax liability at time of loan application. • Specific tax questions should be directed to the IRS or a licensed tax preparer.

14. Purchase Assistance Loan-PAL • State has over $800,000 available funds for 2007 • It’s a down payment and closing cost assistance loan for low income first-time homebuyers. • Up to $10,000 loan at 0% interest. • No payments due until payoff or transfer of title. • OHCS currently has funding for 80 households. • The PAL loan qualifies as a borrower’s minimum investment for FHA loans. • Must be used with Oregon Bond’s RateAdvantage Home Loan option.

15. PAL-Eligible Properties • Single-family homes (1 unit) in Oregon not located in either Clackamas, Multnomah, Washington Counties; or Salem-Keizer or Eugene-Springfield. • Purchase price must be at or below FHA mortgage limits. • Must pass an Housing Quality Standards (HQS) inspection or FHA Minimum Property Standards. • Existing home must pass a Pest & Dry Rot inspection. • To comply with federal Lead Based Paint laws a home built prior to 1978 may not have any blistering, cracking, chipping or pealing paint on any interior or exterior surface.

16. PAL-Borrower Qualifications • First-time homebuyers: May not have owned or occupied a home in last three years (unless a single-parent or displaced homemaker). • Household income limit is 80% of the area median income adjusted for household size ( see chart). • Must occupy as their Primary Residence. • No more than $5,000 in liquid assets after closing. • The house payment (PITI) must be between 25% and 45%. The total debt ratio may not exceed 45%. • Must complete homebuyer education class. • No recent bankruptcies (2 years) or foreclosures (5 years).

17. Where can I get more info about Oregon Bond or PAL? • Visit www.OregonBond.us. • Call toll free at 1-877-ST8-BOND! • Work with a local lender you can find on our website. • Work closely with the staff at the Regional Housing Center!

18. Any Questions?Thank You!