1. SHIFT Tactic 10: Financing Solutions
28 Legal, Proven Ways
to Get the Deal Done in a Shifted Market

2. Main Ideas Overview What Sellers Can Do in a Changing Market
What Buyers Can Do in a Changing Market
What Lenders Can Do in a Changing Market
The Bottom Line
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3. OVERVIEW
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4. Overview Separated into three parts:
What Sellers Can Do in a Changing Market
What Buyers Can Do in a Changing Market
What Lenders Can Do in a Changing Market
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5. Overview The Challenge The Solution Watch Out! Snapshot
Describes current market condition or problem
The Solution
Provides an answer to the Challenge
Watch Out!
Describes potential pit falls
Snapshot
Real life situations
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6. Overview
The “IAC”
Income
Assets
Credit
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7. Getting the Most Out of This Experience
The Prisoner
Has to be there, doesn’t want to
be there, and doesn’t know
why they’re there.
The Vacationer
A day in training is
Better than a day on the job.
The Explorer
Excited and curious about the new knowledge, skills, and tools
they will discover in class.
Doesn’t engage
Spends as much time chatting as listening
Listens attentively, then participates fully in discussions and exercises
Spends class time catching up on their s
There to have fun—distracts the class with irrelevant comments
Asks meaningful questions and contributes compelling aha’s
Escapes by spending time in the hall on their phone
Returns late from break and lunch
Arrives to class on time and returns promptly from breaks
Holds on to limiting beliefs
Not purposeful in their learning goals
Adopts a posture of acceptance
Multi-tasks on their computer by working on side projects
OMG! Spends the day on their smartphone, texting and checking Facebook
Takes notes in their manual for future reference
Picks fights with trainer or other participants if they don’t agree
Isn’t paying attention
Respects the different learning styles and opinions of others
Hopefully, you picked “The Explorer!”
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8. WHAT SELLERS CAN DO IN A CHANGING MARKET
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9. 1. Seller Contributions: What, When, and How
The Challenge
Seller is being transferred
Needs to sell within 60 days
Priced at $250,000
Seller agreed to pay buyer’s closing costs
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10. 2. Seller-Funded Permanent Buydowns
The Challenge
Seller will pay up to two percent of the sales price in closing costs
Closing cost credit has become too common
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11. 3. Seller-Funded Temporary Buydowns
The Challenge
There is a stagnant market
Enticing buyers is difficult
Buyers are focused on interest rates
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12. 4. Owner Financing The Challenge Seller owns his home free and clear
Seller listed the home for $250,000
FSBO
Market is not good
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13. 5. Contract for Deed The Challenge Buyer’s market
Many buyers have had trouble qualifying for financing from conventional or government lenders
Unique properties
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14. 6. Seller Seconds The Challenge Loan to value (LTV)
Combined loan to value (CLTV)
Private mortgage insurance (PMI)
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15. 7. Lease with Option and Lease Purchase
The Challenge
Slow market
Seller’s time frame
Small pool of buyers
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16. 8. Selling to Relatives The Challenge Appraisal of the property
Sales contract / value of the home
Little to no down payment money
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17. 9. Wraparound Mortgages The Challenge Home is listed for $200,000
Home loan balance is $100,000
Current market is not good
Current mortgage rate is 5% (market rates are closer to 8%)
Buyer asks seller to consider financing the sale
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18. WHAT BUYERS CAN DO IN A CHANGING MARKET
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19. 10. Using a 401(k) The Challenge
Buyer doesn’t have enough in savings for a down payment
FHA and zero-down loans still require closing costs
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20. 11. Temporary IRA Transfers
The Challenge
Buyers found the right house
Not enough in savings for a down payment
They have an IRA, but want to avoid a penalty
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21. 12. Appraisable Assets for Down Payment and Closing Costs
The Challenge
Not enough cash for a down payment or closing costs
They own valuables, including a coin collection
Can put some money down and are thinking about a second mortgage
Still short on closing costs
Worried about interest rates
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22. 13. Pledged Asset Mortgages (PAMs)
The Challenge
Buyer is having trouble saving for down payment and closing costs
Interest rates plus mortgage insurance cost make monthly payments too high
Affordability is an issue in the buyer’s preferred neighborhood
Prices are up and concessions are down in the current market
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23. 14. Equity Transfers and Bridge Loans
The Challenge
Market is steady
Asking prices are mostly holding
Seller concessions aren’t uncommon
Buyer is the market for a bigger house
Would have to sell current property to buy
Found the perfect house, but there is no money for a down payment
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24. 15. Down Payment Sources and Gift Funds
The Challenge
Buyers are newlywed couple, just out of college with jobs
Limited money available
Where they live, rents are higher than a mortgage payment
They have family that will help them financially
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25. 16. Nonoccupant Coborrowers
The Challenge
Buyer is a young lady with an internship
Rental market easily outpaces monthly mortgage payments
Demand is starting to push prices up
Father frequently advises her to buy
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26. 17. Employer Assisted Mortgages (EAMs)
The Challenge
Hot market has cooled off
Buyer has five percent saved, but would like to avoid PMI
Worried that if he doesn’t buy now, prices will go back up
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27. WHAT LENDERS CAN DO IN A CHANGING MARKET
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28. 18. Lender-Funded Buydowns
The Challenge
Market is tight, inventory is low, homes are selling quickly
Buyer won’t be fully vested in his pay structure for two years
Wants a $200,000 bungalow
His ratios are pushing 50 and he can’t qualify
He has just over $20,000 for a down payment and closing costs
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29. 19. The “MyCommunityMortgage”
The Challenge
Buyers want to buy their first home, but have no money for closing costs
Don’t have a strong credit profile
Have other forms of credit history
Mortgage payments would be less than rent
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30. 20. Leveraging Automated Underwriting Systems
The Challenge
Market is hot
Rates are stable, but prices are rising
Fewer people are qualifying
Potential buyers are “underwriting themselves”
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31. 21. Adjusting Amortization Periods
The Challenge
A couple is deciding whether to buy or not
They have enough for a five percent down payment on a $250,000 home
Rates and prices are starting to move up
Want a fixed rate mortgage
Parents advised them that mortgage interest should be kept down and to take a shorter length mortgage
Course Page 126

32. 22. Adjusting Interest Rates to Cover Closing Costs
The Challenge
Buyers have money for down payments in the form of equity
Closing costs are expensive
If seller won’t pay closing costs, and the buyer doesn’t want to or can’t, who will?
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33. 23. State, Province, and Local Government Grant and Bond Programs
The Challenge
Home affordability index is rising
Interest rates are going up
Down payment money is hard to come by
Local governments want some of their first responders to live closer to work
Employees don’t make enough money to do so
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34. 24. Mortgage Credit Certificates—MCC
The Challenge
Relatively strong market
Homeowners can use their accumulated equity
Contingency offers are being rejected
First time homebuyers are being shut out
Buyers must look away from their jobs and schools to find an affordable home
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35. 25. Expanded Alternative Lending
The Challenge
Buyer has experienced rough times
Credit and lack of down payment are holding her back
Interest rates are stable
Couldn’t qualify for FHA financing
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36. 26. Subprime Lending The Challenge
Potential buyer retired and took severance pay
Had a new job lined up
Admitted to hospital without insurance
Credit deteriorated
Was shopping for a home when life changes took place
Abandoned efforts as a result
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37. 27. Private Lending The Challenge
Potential buyer has money won through lawsuit
Ruined his credit profile
Rejected for loans
Has 30% down, plus closing costs
Could have paid cash, but didn’t want to
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38. 28. No Documentation Programs
The Challenge
Property doesn’t meet loan requirements
Buyer’s situation doesn’t meet loan criteria
Income can’t be used because it doesn’t have a track record
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39. THE BOTTOM LINE
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40. The Bottom Line Opportunities exist, you just need to find them!
Apply more than one technique to the same transaction, if needed
Look for creative solutions
Consult with your team to make sure you are conforming with area norms and laws
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41. Career Growth Initiative
Listing Management
Listings (Monthly)
Pipeline (Buyers/Sellers)
VALUE
GCI
Agent Trend
Agent LORE
Local Expert
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42. Career Growth Initiative
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43. Take the other courses in the SHIFT Tactics series!
Gaining Mind over Market
Upshifting Your Lead Generation
Seller Pricing Strategies
Seller Staging Strategies
Lead Capture and Conversion
Internet Lead Capture and Conversion
Creating Urgency to Buy
Expense Management
Effective People Leverage 
Short Sales, Foreclosures, and REOs
Bulletproofing the Transaction

44. From Aha’s to Achievement
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45. Select drop-down to scroll for title of this course
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