Buyer Information Packet

welcomeThe American Homeownership Initiative turns renters into homeown-

ers using an alternative financing system AHI brings together real

estate professionals major American corporations and other resources

for a national program that provides homeownership opportunities

wwwrealtororglibrarylibraryfg302The Impact of Housing on Community A Review of Scholarly Theories and Empirical Research (Joint Center for Housing Studies of Harvard University Mar 2006)

The current economic crisis and

distressed mortgage system can

make purchasing a home frustrat-

ing and complex Large down

payments closing costs mortgage

qualification and the closing process

have become increasingly difficult

This booklet is designed to educate

you the buyer about how AHIrsquos

system and working with your local

Real Estate Professional can

make your dream of homeowner-

ship a reality

Studies have shown in areas with

high homeownership rates that

health safety education and overall

quality of life improves greatly

while crime and unemployment

rates typically decline

The Challenge of the Conventional Mortgage

In most home sales a buyer agrees to purchase a

property at a set price The buyer obtains a mortgage

from the lender and along with the down payment

pays the seller and closing costs and gets the title to

the property If a certain number of payments are

missed the lender forecloses on the loan and reclaims

the property

The most widely used mortgage is paid over 30 years

at a fixed interest rate

The lending process has become increas-

ingly complex as it evolves Costs associ-

ated with a traditional mortgage include

Title insurance to guarantee no prior

mortgages or liens exist

Lender points

Survey to confirm the dimensions and

location of the property

Appraisal confirm the selling price is equal

to or less than the propertyrsquos actual value

To qualify for a traditional mortgage

lenders look at a set of specific criteria

Down payment

Credit score

Two years of income tax returns W2 1099

Current debt and assets

Two months of bank statements showing

down payment

American Homeownership Initiative (AHI) Process

The Installment Sales Agreement (ISA) also referred to as a contract for deed or a land sales con-

tract is used to buy and sell real estate It is a contract directly between the buyer and seller for

the transfer of equitable title and possession rights The actual deed is then transferred when the

contract is paid off either over time or if the buyer refinances with a conventional mortgage It

was widely used before 1950 throughout the country

1 The AHI Seller working with

an AHI Registered Real Es-

tate Professional offers the property

for sale with price down payment

amount interest rate and contract

term pre-set

2 The AHI Buyer can negotiate

as they wish on these terms

3 AHI Buyer and AHI Seller

agree on the contract amount

4 The Real Estate Professional

prepares the paper work

which the AHI Buyer and AHI

Seller sign at closing

How the AHI process works

5Closing elements include

AHI Buyer receives equitable title on day one

An assignment of the contract and recognition letter is provided to

the AHI Sellerrsquos existing bank and title insurance provider

AHI recommends using a 30-yearfixed interest rate based on the

current mortgage rate

6 After closing

AHI Buyer receives tax benefits from home ownership and savings

are reflected in paycheck after adjustments to W-4 (see your local tax

professional)

AHI Buyer pays AHI Seller a monthly payment

No pre-payment penalties if the AHI Buyer refinances

Contract can be assigned to another buyer with seller approval

AHI Buyerrsquos termination of the ISA contract eliminates future

obligations

About the AHI Process

In the early 90s a principal for the

Initiative successfully directed the

conversion of several large apart-

ment buildings to owner-occupied

individual condominiums for the

Philadelphia developer Historic

Landmarks for Living An innova-

tive seller-financing program was

used that featured simplification of

the tenantbuyerrsquos purchase with

low down payments and the ISA for

immediate homeownership

AHI has been created by a group

of professionals working with large

national companies to implement a

similar program on a national basis

To implement the program AHI

provides detailed specific and edu-

cational information to local real

estate professionals to work with you

and the current property owner

Purchase of home for about the same monthly cost as renting

with a down payment of 1-4 and closing costs paid by the AHI

Seller

The AHI Buyer to build credit through reporting timely monthly

payments to credit bureaus using Mortgage Access Corporation

(MAC) or another similar service

Investment in a city and community as an owner

The AHI Buyer to get homeownership tax benefits

The AHI Process Enables

AHI Buyer Benefits

Homeownership though equitable title at closing

Low down payment usually 1-4 of the home value

AHI Calculated Sales Price is based on local market rents

Closing costs are paid by the AHI Seller

First-time home buyer may have a tax credit up to

$8000 (2009 only)

Tax deductions for mortgage interest and property taxes

First-time Home buyer Tax Credit of $8000httpwwwfederalhousingtaxcreditcom site released by the National Association of Home Buildershttpwwwirsgovnewsroomarticle0id=20467100html site released by the United States Internal Revenue Service

Better approach than the typical rent-to-own

and lease-to-own options

Credit repair if necessary

Positive credit reporting

AHI Buyer is working towards building equity

with each payment

Fixed monthly payments based on a 30-year

contract

Refinance at a lower rate if applicable

No prepayment penalty

Termination of contract without credit damage

or foreclosure

Contract is assumable with certain restrictions

Down Payment and typical closing costs for a home purchase

In the AHI system it is recommended the seller pay

all closing costs Previously these costs were typically

shared between buyer and seller

Examples of such costs for a $150000 purchase are

Summary of Closing Costs

Mortgage Costs Loan Origination Fee

Appraisal Fees

Processing Fees

Title Charges

Settlement or Closing Fee

Title InsuranceTitle Fees

Real Estate Taxes

Recording Fee

City Transfer Tax

State Transfer tax

Down Payment

Total Cash Needed to Close

AHI Process

0

0

0

0

0

0

Determined at closing

0

0

0

$3000

$3000

Conventional Mortgage Loan (FHA)

$1500 (1)

$300

$1000

$1500

$200

$1450

Determined at closing

$280

$2250

$750

$4500 (3)

$12230

Conventional Mortgage Loan (non-FHA)

$1500 (1)

$300

$1000

$1500

$200

$1450

Determined at closing

$280

$2250

$750

$30000 (20)

$37730

Typical monthly payment and tax savingsThe AHI Buyer can deduct interest and property tax from their Federal

Income Tax Since this benefit varies with individuals and states a tax

specialist should be consulted for each situation Example

Contract Monthly Payment

AHI Calculated Sales Price

Down Payment (Percent)

Down Payment (Dollars)

Purchase with 30yrFixed 6

Monthly Contract Payment

Monthly Real Estate Taxes

Monthly Homeowners Insurance

Monthly Maintenance

Monthly Total Payment

Estimated Tax Savings

Mortgage Interest Paid

Real Estate Taxes Paid

Medical Expenses Paid

Charitable Expenses Paid

Tax Preparation amp Job Expenses

Total Itemized Deductions

Standard Deduction

Excess Itemized Deductions Less

Monthly Tax Savings for AHI Buyer 25

Rate (Itemized Divided by 12 Months Multi-

plied by 25 Tax Rate)

Monthly Total

Monthly Tax Savings for ISA Buyer

Monthly Payments after Deductions

1

$75000

20

$1500

$73500

$441

$83

$75

$50

$649

$4451

$1000

$200

$200

$500

$6351

$5450

$901

$19

$649

-$19

$630

2

$150000

20

$3000

$147000

$881

$83

$75

$50

$1090

$8902

$1000

$200

$200

$500

$10802

$5450

$5352

$111

$1090

-$111

$978

3

$250000

20

$5000

$245000

$1469

$83

$75

$50

$1702

$14837

$1000

$200

$200

$500

$16737

$5450

$11287

$235

$1702

-$235

$1467

PricingHow is the price for each home

determined

The Real Estate Professional works with the AHI Seller

to determine the AHI Calculated Sales Price The Real

Estate Professional uses local market rents to calculate

the purchase price

How is the interest rate determined

AHI recommends that the interest rate be fixed for the

30-year term This means the AHI Buyer will have

the agreed upon interest rate for the entire length of the

ISA contract or until refinance

AHI Buyerrsquos ability to terminate the contract

Things happen Situations change The AHI Program provides a way to

protect your future ability to purchase a home or apply for credit What

does it mean It means no foreclosure If at any time you canrsquot make your

payments or you simply wish to move the AHI Seller can (with certain

restrictions) transfer the ISA to a new buyer The AHI Buyer also has the

right to sell the property ldquoconventionallyrdquo at any time

Job Loss Protection

AHI has arranged for the AHI Seller to buy optional job loss insurance

through the HELP program for up to six months of contract payments

if the buyer involuntarily loses their job

AHI Buyer Benefits

AHI has built a group of nationally recognized and respected corporate

product and service providers to enhance the buying experience AHI

Buyer Benefits are provided to the AHI Buyer at closing The portfolio

delivers discounts on superior products and services

welcomeThe American Homeownership Initiative turns renters into homeown-

ers using an alternative financing system AHI brings together real

estate professionals major American corporations and other resources

for a national program that provides homeownership opportunities

wwwrealtororglibrarylibraryfg302The Impact of Housing on Community A Review of Scholarly Theories and Empirical Research (Joint Center for Housing Studies of Harvard University Mar 2006)

The current economic crisis and

distressed mortgage system can

make purchasing a home frustrat-

ing and complex Large down

payments closing costs mortgage

qualification and the closing process

have become increasingly difficult

This booklet is designed to educate

you the buyer about how AHIrsquos

system and working with your local

Real Estate Professional can

make your dream of homeowner-

ship a reality

Studies have shown in areas with

high homeownership rates that

health safety education and overall

quality of life improves greatly

while crime and unemployment

rates typically decline

The Challenge of the Conventional Mortgage

In most home sales a buyer agrees to purchase a

property at a set price The buyer obtains a mortgage

from the lender and along with the down payment

pays the seller and closing costs and gets the title to

the property If a certain number of payments are

missed the lender forecloses on the loan and reclaims

the property

The most widely used mortgage is paid over 30 years

at a fixed interest rate

The lending process has become increas-

ingly complex as it evolves Costs associ-

ated with a traditional mortgage include

Title insurance to guarantee no prior

mortgages or liens exist

Lender points

Survey to confirm the dimensions and

location of the property

Appraisal confirm the selling price is equal

to or less than the propertyrsquos actual value

To qualify for a traditional mortgage

lenders look at a set of specific criteria

Down payment

Credit score

Two years of income tax returns W2 1099

Current debt and assets

Two months of bank statements showing

down payment

American Homeownership Initiative (AHI) Process

The Installment Sales Agreement (ISA) also referred to as a contract for deed or a land sales con-

tract is used to buy and sell real estate It is a contract directly between the buyer and seller for

the transfer of equitable title and possession rights The actual deed is then transferred when the

contract is paid off either over time or if the buyer refinances with a conventional mortgage It

was widely used before 1950 throughout the country

1 The AHI Seller working with

an AHI Registered Real Es-

tate Professional offers the property

for sale with price down payment

amount interest rate and contract

term pre-set

2 The AHI Buyer can negotiate

as they wish on these terms

3 AHI Buyer and AHI Seller

agree on the contract amount

4 The Real Estate Professional

prepares the paper work

which the AHI Buyer and AHI

Seller sign at closing

How the AHI process works

5Closing elements include

AHI Buyer receives equitable title on day one

An assignment of the contract and recognition letter is provided to

the AHI Sellerrsquos existing bank and title insurance provider

AHI recommends using a 30-yearfixed interest rate based on the

current mortgage rate

6 After closing

AHI Buyer receives tax benefits from home ownership and savings

are reflected in paycheck after adjustments to W-4 (see your local tax

professional)

AHI Buyer pays AHI Seller a monthly payment

No pre-payment penalties if the AHI Buyer refinances

Contract can be assigned to another buyer with seller approval

AHI Buyerrsquos termination of the ISA contract eliminates future

obligations

About the AHI Process

In the early 90s a principal for the

Initiative successfully directed the

conversion of several large apart-

ment buildings to owner-occupied

individual condominiums for the

Philadelphia developer Historic

Landmarks for Living An innova-

tive seller-financing program was

used that featured simplification of

the tenantbuyerrsquos purchase with

low down payments and the ISA for

immediate homeownership

AHI has been created by a group

of professionals working with large

national companies to implement a

similar program on a national basis

To implement the program AHI

provides detailed specific and edu-

cational information to local real

estate professionals to work with you

and the current property owner

Purchase of home for about the same monthly cost as renting

with a down payment of 1-4 and closing costs paid by the AHI

Seller

The AHI Buyer to build credit through reporting timely monthly

payments to credit bureaus using Mortgage Access Corporation

(MAC) or another similar service

Investment in a city and community as an owner

The AHI Buyer to get homeownership tax benefits

The AHI Process Enables

AHI Buyer Benefits

Homeownership though equitable title at closing

Low down payment usually 1-4 of the home value

AHI Calculated Sales Price is based on local market rents

Closing costs are paid by the AHI Seller

First-time home buyer may have a tax credit up to

$8000 (2009 only)

Tax deductions for mortgage interest and property taxes

First-time Home buyer Tax Credit of $8000httpwwwfederalhousingtaxcreditcom site released by the National Association of Home Buildershttpwwwirsgovnewsroomarticle0id=20467100html site released by the United States Internal Revenue Service

Better approach than the typical rent-to-own

and lease-to-own options

Credit repair if necessary

Positive credit reporting

AHI Buyer is working towards building equity

with each payment

Fixed monthly payments based on a 30-year

contract

Refinance at a lower rate if applicable

No prepayment penalty

Termination of contract without credit damage

or foreclosure

Contract is assumable with certain restrictions

Down Payment and typical closing costs for a home purchase

In the AHI system it is recommended the seller pay

all closing costs Previously these costs were typically

shared between buyer and seller

Examples of such costs for a $150000 purchase are

Summary of Closing Costs

Mortgage Costs Loan Origination Fee

Appraisal Fees

Processing Fees

Title Charges

Settlement or Closing Fee

Title InsuranceTitle Fees

Real Estate Taxes

Recording Fee

City Transfer Tax

State Transfer tax

Down Payment

Total Cash Needed to Close

AHI Process

0

0

0

0

0

0

Determined at closing

0

0

0

$3000

$3000

Conventional Mortgage Loan (FHA)

$1500 (1)

$300

$1000

$1500

$200

$1450

Determined at closing

$280

$2250

$750

$4500 (3)

$12230

Conventional Mortgage Loan (non-FHA)

$1500 (1)

$300

$1000

$1500

$200

$1450

Determined at closing

$280

$2250

$750

$30000 (20)

$37730

Typical monthly payment and tax savingsThe AHI Buyer can deduct interest and property tax from their Federal

Income Tax Since this benefit varies with individuals and states a tax

specialist should be consulted for each situation Example

Contract Monthly Payment

AHI Calculated Sales Price

Down Payment (Percent)

Down Payment (Dollars)

Purchase with 30yrFixed 6

Monthly Contract Payment

Monthly Real Estate Taxes

Monthly Homeowners Insurance

Monthly Maintenance

Monthly Total Payment

Estimated Tax Savings

Mortgage Interest Paid

Real Estate Taxes Paid

Medical Expenses Paid

Charitable Expenses Paid

Tax Preparation amp Job Expenses

Total Itemized Deductions

Standard Deduction

Excess Itemized Deductions Less

Monthly Tax Savings for AHI Buyer 25

Rate (Itemized Divided by 12 Months Multi-

plied by 25 Tax Rate)

Monthly Total

Monthly Tax Savings for ISA Buyer

Monthly Payments after Deductions

1

$75000

20

$1500

$73500

$441

$83

$75

$50

$649

$4451

$1000

$200

$200

$500

$6351

$5450

$901

$19

$649

-$19

$630

2

$150000

20

$3000

$147000

$881

$83

$75

$50

$1090

$8902

$1000

$200

$200

$500

$10802

$5450

$5352

$111

$1090

-$111

$978

3

$250000

20

$5000

$245000

$1469

$83

$75

$50

$1702

$14837

$1000

$200

$200

$500

$16737

$5450

$11287

$235

$1702

-$235

$1467

PricingHow is the price for each home

determined

The Real Estate Professional works with the AHI Seller

to determine the AHI Calculated Sales Price The Real

Estate Professional uses local market rents to calculate

the purchase price

How is the interest rate determined

AHI recommends that the interest rate be fixed for the

30-year term This means the AHI Buyer will have

the agreed upon interest rate for the entire length of the

ISA contract or until refinance

AHI Buyerrsquos ability to terminate the contract

Things happen Situations change The AHI Program provides a way to

protect your future ability to purchase a home or apply for credit What

does it mean It means no foreclosure If at any time you canrsquot make your

payments or you simply wish to move the AHI Seller can (with certain

restrictions) transfer the ISA to a new buyer The AHI Buyer also has the

right to sell the property ldquoconventionallyrdquo at any time

Job Loss Protection

AHI has arranged for the AHI Seller to buy optional job loss insurance

through the HELP program for up to six months of contract payments

if the buyer involuntarily loses their job

AHI Buyer Benefits

AHI has built a group of nationally recognized and respected corporate

product and service providers to enhance the buying experience AHI

Buyer Benefits are provided to the AHI Buyer at closing The portfolio

delivers discounts on superior products and services

The Challenge of the Conventional Mortgage

In most home sales a buyer agrees to purchase a

property at a set price The buyer obtains a mortgage

from the lender and along with the down payment

pays the seller and closing costs and gets the title to

the property If a certain number of payments are

missed the lender forecloses on the loan and reclaims

the property

The most widely used mortgage is paid over 30 years

at a fixed interest rate

The lending process has become increas-

ingly complex as it evolves Costs associ-

ated with a traditional mortgage include

Title insurance to guarantee no prior

mortgages or liens exist

Lender points

Survey to confirm the dimensions and

location of the property

Appraisal confirm the selling price is equal

to or less than the propertyrsquos actual value

To qualify for a traditional mortgage

lenders look at a set of specific criteria

Down payment

Credit score

Two years of income tax returns W2 1099

Current debt and assets

Two months of bank statements showing

down payment

American Homeownership Initiative (AHI) Process

The Installment Sales Agreement (ISA) also referred to as a contract for deed or a land sales con-

tract is used to buy and sell real estate It is a contract directly between the buyer and seller for

the transfer of equitable title and possession rights The actual deed is then transferred when the

contract is paid off either over time or if the buyer refinances with a conventional mortgage It

was widely used before 1950 throughout the country

1 The AHI Seller working with

an AHI Registered Real Es-

tate Professional offers the property

for sale with price down payment

amount interest rate and contract

term pre-set

2 The AHI Buyer can negotiate

as they wish on these terms

3 AHI Buyer and AHI Seller

agree on the contract amount

4 The Real Estate Professional

prepares the paper work

which the AHI Buyer and AHI

Seller sign at closing

How the AHI process works

5Closing elements include

AHI Buyer receives equitable title on day one

An assignment of the contract and recognition letter is provided to

the AHI Sellerrsquos existing bank and title insurance provider

AHI recommends using a 30-yearfixed interest rate based on the

current mortgage rate

6 After closing

AHI Buyer receives tax benefits from home ownership and savings

are reflected in paycheck after adjustments to W-4 (see your local tax

professional)

AHI Buyer pays AHI Seller a monthly payment

No pre-payment penalties if the AHI Buyer refinances

Contract can be assigned to another buyer with seller approval

AHI Buyerrsquos termination of the ISA contract eliminates future

obligations

About the AHI Process

In the early 90s a principal for the

Initiative successfully directed the

conversion of several large apart-

ment buildings to owner-occupied

individual condominiums for the

Philadelphia developer Historic

Landmarks for Living An innova-

tive seller-financing program was

used that featured simplification of

the tenantbuyerrsquos purchase with

low down payments and the ISA for

immediate homeownership

AHI has been created by a group

of professionals working with large

national companies to implement a

similar program on a national basis

To implement the program AHI

provides detailed specific and edu-

cational information to local real

estate professionals to work with you

and the current property owner

Purchase of home for about the same monthly cost as renting

with a down payment of 1-4 and closing costs paid by the AHI

Seller

The AHI Buyer to build credit through reporting timely monthly

payments to credit bureaus using Mortgage Access Corporation

(MAC) or another similar service

Investment in a city and community as an owner

The AHI Buyer to get homeownership tax benefits

The AHI Process Enables

AHI Buyer Benefits

Homeownership though equitable title at closing

Low down payment usually 1-4 of the home value

AHI Calculated Sales Price is based on local market rents

Closing costs are paid by the AHI Seller

First-time home buyer may have a tax credit up to

$8000 (2009 only)

Tax deductions for mortgage interest and property taxes

First-time Home buyer Tax Credit of $8000httpwwwfederalhousingtaxcreditcom site released by the National Association of Home Buildershttpwwwirsgovnewsroomarticle0id=20467100html site released by the United States Internal Revenue Service

Better approach than the typical rent-to-own

and lease-to-own options

Credit repair if necessary

Positive credit reporting

AHI Buyer is working towards building equity

with each payment

Fixed monthly payments based on a 30-year

contract

Refinance at a lower rate if applicable

No prepayment penalty

Termination of contract without credit damage

or foreclosure

Contract is assumable with certain restrictions

Down Payment and typical closing costs for a home purchase

In the AHI system it is recommended the seller pay

all closing costs Previously these costs were typically

shared between buyer and seller

Examples of such costs for a $150000 purchase are

Summary of Closing Costs

Mortgage Costs Loan Origination Fee

Appraisal Fees

Processing Fees

Title Charges

Settlement or Closing Fee

Title InsuranceTitle Fees

Real Estate Taxes

Recording Fee

City Transfer Tax

State Transfer tax

Down Payment

Total Cash Needed to Close

AHI Process

0

0

0

0

0

0

Determined at closing

0

0

0

$3000

$3000

Conventional Mortgage Loan (FHA)

$1500 (1)

$300

$1000

$1500

$200

$1450

Determined at closing

$280

$2250

$750

$4500 (3)

$12230

Conventional Mortgage Loan (non-FHA)

$1500 (1)

$300

$1000

$1500

$200

$1450

Determined at closing

$280

$2250

$750

$30000 (20)

$37730

Typical monthly payment and tax savingsThe AHI Buyer can deduct interest and property tax from their Federal

Income Tax Since this benefit varies with individuals and states a tax

specialist should be consulted for each situation Example

Contract Monthly Payment

AHI Calculated Sales Price

Down Payment (Percent)

Down Payment (Dollars)

Purchase with 30yrFixed 6

Monthly Contract Payment

Monthly Real Estate Taxes

Monthly Homeowners Insurance

Monthly Maintenance

Monthly Total Payment

Estimated Tax Savings

Mortgage Interest Paid

Real Estate Taxes Paid

Medical Expenses Paid

Charitable Expenses Paid

Tax Preparation amp Job Expenses

Total Itemized Deductions

Standard Deduction

Excess Itemized Deductions Less

Monthly Tax Savings for AHI Buyer 25

Rate (Itemized Divided by 12 Months Multi-

plied by 25 Tax Rate)

Monthly Total

Monthly Tax Savings for ISA Buyer

Monthly Payments after Deductions

1

$75000

20

$1500

$73500

$441

$83

$75

$50

$649

$4451

$1000

$200

$200

$500

$6351

$5450

$901

$19

$649

-$19

$630

2

$150000

20

$3000

$147000

$881

$83

$75

$50

$1090

$8902

$1000

$200

$200

$500

$10802

$5450

$5352

$111

$1090

-$111

$978

3

$250000

20

$5000

$245000

$1469

$83

$75

$50

$1702

$14837

$1000

$200

$200

$500

$16737

$5450

$11287

$235

$1702

-$235

$1467

PricingHow is the price for each home

determined

The Real Estate Professional works with the AHI Seller

to determine the AHI Calculated Sales Price The Real

Estate Professional uses local market rents to calculate

the purchase price

How is the interest rate determined

AHI recommends that the interest rate be fixed for the

30-year term This means the AHI Buyer will have

the agreed upon interest rate for the entire length of the

ISA contract or until refinance

AHI Buyerrsquos ability to terminate the contract

Things happen Situations change The AHI Program provides a way to

protect your future ability to purchase a home or apply for credit What

does it mean It means no foreclosure If at any time you canrsquot make your

payments or you simply wish to move the AHI Seller can (with certain

restrictions) transfer the ISA to a new buyer The AHI Buyer also has the

right to sell the property ldquoconventionallyrdquo at any time

Job Loss Protection

AHI has arranged for the AHI Seller to buy optional job loss insurance

through the HELP program for up to six months of contract payments

if the buyer involuntarily loses their job

AHI Buyer Benefits

AHI has built a group of nationally recognized and respected corporate

product and service providers to enhance the buying experience AHI

Buyer Benefits are provided to the AHI Buyer at closing The portfolio

delivers discounts on superior products and services

American Homeownership Initiative (AHI) Process

The Installment Sales Agreement (ISA) also referred to as a contract for deed or a land sales con-

tract is used to buy and sell real estate It is a contract directly between the buyer and seller for

the transfer of equitable title and possession rights The actual deed is then transferred when the

contract is paid off either over time or if the buyer refinances with a conventional mortgage It

was widely used before 1950 throughout the country

1 The AHI Seller working with

an AHI Registered Real Es-

tate Professional offers the property

for sale with price down payment

amount interest rate and contract

term pre-set

2 The AHI Buyer can negotiate

as they wish on these terms

3 AHI Buyer and AHI Seller

agree on the contract amount

4 The Real Estate Professional

prepares the paper work

which the AHI Buyer and AHI

Seller sign at closing

How the AHI process works

5Closing elements include

AHI Buyer receives equitable title on day one

An assignment of the contract and recognition letter is provided to

the AHI Sellerrsquos existing bank and title insurance provider

AHI recommends using a 30-yearfixed interest rate based on the

current mortgage rate

6 After closing

AHI Buyer receives tax benefits from home ownership and savings

are reflected in paycheck after adjustments to W-4 (see your local tax

professional)

AHI Buyer pays AHI Seller a monthly payment

No pre-payment penalties if the AHI Buyer refinances

Contract can be assigned to another buyer with seller approval

AHI Buyerrsquos termination of the ISA contract eliminates future

obligations

About the AHI Process

In the early 90s a principal for the

Initiative successfully directed the

conversion of several large apart-

ment buildings to owner-occupied

individual condominiums for the

Philadelphia developer Historic

Landmarks for Living An innova-

tive seller-financing program was

used that featured simplification of

the tenantbuyerrsquos purchase with

low down payments and the ISA for

immediate homeownership

AHI has been created by a group

of professionals working with large

national companies to implement a

similar program on a national basis

To implement the program AHI

provides detailed specific and edu-

cational information to local real

estate professionals to work with you

and the current property owner

Purchase of home for about the same monthly cost as renting

with a down payment of 1-4 and closing costs paid by the AHI

Seller

The AHI Buyer to build credit through reporting timely monthly

payments to credit bureaus using Mortgage Access Corporation

(MAC) or another similar service

Investment in a city and community as an owner

The AHI Buyer to get homeownership tax benefits

The AHI Process Enables

AHI Buyer Benefits

Homeownership though equitable title at closing

Low down payment usually 1-4 of the home value

AHI Calculated Sales Price is based on local market rents

Closing costs are paid by the AHI Seller

First-time home buyer may have a tax credit up to

$8000 (2009 only)

Tax deductions for mortgage interest and property taxes

First-time Home buyer Tax Credit of $8000httpwwwfederalhousingtaxcreditcom site released by the National Association of Home Buildershttpwwwirsgovnewsroomarticle0id=20467100html site released by the United States Internal Revenue Service

Better approach than the typical rent-to-own

and lease-to-own options

Credit repair if necessary

Positive credit reporting

AHI Buyer is working towards building equity

with each payment

Fixed monthly payments based on a 30-year

contract

Refinance at a lower rate if applicable

No prepayment penalty

Termination of contract without credit damage

or foreclosure

Contract is assumable with certain restrictions

Down Payment and typical closing costs for a home purchase

In the AHI system it is recommended the seller pay

all closing costs Previously these costs were typically

shared between buyer and seller

Examples of such costs for a $150000 purchase are

Summary of Closing Costs

Mortgage Costs Loan Origination Fee

Appraisal Fees

Processing Fees

Title Charges

Settlement or Closing Fee

Title InsuranceTitle Fees

Real Estate Taxes

Recording Fee

City Transfer Tax

State Transfer tax

Down Payment

Total Cash Needed to Close

AHI Process

0

0

0

0

0

0

Determined at closing

0

0

0

$3000

$3000

Conventional Mortgage Loan (FHA)

$1500 (1)

$300

$1000

$1500

$200

$1450

Determined at closing

$280

$2250

$750

$4500 (3)

$12230

Conventional Mortgage Loan (non-FHA)

$1500 (1)

$300

$1000

$1500

$200

$1450

Determined at closing

$280

$2250

$750

$30000 (20)

$37730

Typical monthly payment and tax savingsThe AHI Buyer can deduct interest and property tax from their Federal

Income Tax Since this benefit varies with individuals and states a tax

specialist should be consulted for each situation Example

Contract Monthly Payment

AHI Calculated Sales Price

Down Payment (Percent)

Down Payment (Dollars)

Purchase with 30yrFixed 6

Monthly Contract Payment

Monthly Real Estate Taxes

Monthly Homeowners Insurance

Monthly Maintenance

Monthly Total Payment

Estimated Tax Savings

Mortgage Interest Paid

Real Estate Taxes Paid

Medical Expenses Paid

Charitable Expenses Paid

Tax Preparation amp Job Expenses

Total Itemized Deductions

Standard Deduction

Excess Itemized Deductions Less

Monthly Tax Savings for AHI Buyer 25

Rate (Itemized Divided by 12 Months Multi-

plied by 25 Tax Rate)

Monthly Total

Monthly Tax Savings for ISA Buyer

Monthly Payments after Deductions

1

$75000

20

$1500

$73500

$441

$83

$75

$50

$649

$4451

$1000

$200

$200

$500

$6351

$5450

$901

$19

$649

-$19

$630

2

$150000

20

$3000

$147000

$881

$83

$75

$50

$1090

$8902

$1000

$200

$200

$500

$10802

$5450

$5352

$111

$1090

-$111

$978

3

$250000

20

$5000

$245000

$1469

$83

$75

$50

$1702

$14837

$1000

$200

$200

$500

$16737

$5450

$11287

$235

$1702

-$235

$1467

PricingHow is the price for each home

determined

The Real Estate Professional works with the AHI Seller

to determine the AHI Calculated Sales Price The Real

Estate Professional uses local market rents to calculate

the purchase price

How is the interest rate determined

AHI recommends that the interest rate be fixed for the

30-year term This means the AHI Buyer will have

the agreed upon interest rate for the entire length of the

ISA contract or until refinance

AHI Buyerrsquos ability to terminate the contract

Things happen Situations change The AHI Program provides a way to

protect your future ability to purchase a home or apply for credit What

does it mean It means no foreclosure If at any time you canrsquot make your

payments or you simply wish to move the AHI Seller can (with certain

restrictions) transfer the ISA to a new buyer The AHI Buyer also has the

right to sell the property ldquoconventionallyrdquo at any time

Job Loss Protection

AHI has arranged for the AHI Seller to buy optional job loss insurance

through the HELP program for up to six months of contract payments

if the buyer involuntarily loses their job

AHI Buyer Benefits

AHI has built a group of nationally recognized and respected corporate

product and service providers to enhance the buying experience AHI

Buyer Benefits are provided to the AHI Buyer at closing The portfolio

delivers discounts on superior products and services

About the AHI Process

In the early 90s a principal for the

Initiative successfully directed the

conversion of several large apart-

ment buildings to owner-occupied

individual condominiums for the

Philadelphia developer Historic

Landmarks for Living An innova-

tive seller-financing program was

used that featured simplification of

the tenantbuyerrsquos purchase with

low down payments and the ISA for

immediate homeownership

AHI has been created by a group

of professionals working with large

national companies to implement a

similar program on a national basis

To implement the program AHI

provides detailed specific and edu-

cational information to local real

estate professionals to work with you

and the current property owner

Purchase of home for about the same monthly cost as renting

with a down payment of 1-4 and closing costs paid by the AHI

Seller

The AHI Buyer to build credit through reporting timely monthly

payments to credit bureaus using Mortgage Access Corporation

(MAC) or another similar service

Investment in a city and community as an owner

The AHI Buyer to get homeownership tax benefits

The AHI Process Enables

AHI Buyer Benefits

Homeownership though equitable title at closing

Low down payment usually 1-4 of the home value

AHI Calculated Sales Price is based on local market rents

Closing costs are paid by the AHI Seller

First-time home buyer may have a tax credit up to

$8000 (2009 only)

Tax deductions for mortgage interest and property taxes

First-time Home buyer Tax Credit of $8000httpwwwfederalhousingtaxcreditcom site released by the National Association of Home Buildershttpwwwirsgovnewsroomarticle0id=20467100html site released by the United States Internal Revenue Service

Better approach than the typical rent-to-own

and lease-to-own options

Credit repair if necessary

Positive credit reporting

AHI Buyer is working towards building equity

with each payment

Fixed monthly payments based on a 30-year

contract

Refinance at a lower rate if applicable

No prepayment penalty

Termination of contract without credit damage

or foreclosure

Contract is assumable with certain restrictions

Down Payment and typical closing costs for a home purchase

In the AHI system it is recommended the seller pay

all closing costs Previously these costs were typically

shared between buyer and seller

Examples of such costs for a $150000 purchase are

Summary of Closing Costs

Mortgage Costs Loan Origination Fee

Appraisal Fees

Processing Fees

Title Charges

Settlement or Closing Fee

Title InsuranceTitle Fees

Real Estate Taxes

Recording Fee

City Transfer Tax

State Transfer tax

Down Payment

Total Cash Needed to Close

AHI Process

0

0

0

0

0

0

Determined at closing

0

0

0

$3000

$3000

Conventional Mortgage Loan (FHA)

$1500 (1)

$300

$1000

$1500

$200

$1450

Determined at closing

$280

$2250

$750

$4500 (3)

$12230

Conventional Mortgage Loan (non-FHA)

$1500 (1)

$300

$1000

$1500

$200

$1450

Determined at closing

$280

$2250

$750

$30000 (20)

$37730

Typical monthly payment and tax savingsThe AHI Buyer can deduct interest and property tax from their Federal

Income Tax Since this benefit varies with individuals and states a tax

specialist should be consulted for each situation Example

Contract Monthly Payment

AHI Calculated Sales Price

Down Payment (Percent)

Down Payment (Dollars)

Purchase with 30yrFixed 6

Monthly Contract Payment

Monthly Real Estate Taxes

Monthly Homeowners Insurance

Monthly Maintenance

Monthly Total Payment

Estimated Tax Savings

Mortgage Interest Paid

Real Estate Taxes Paid

Medical Expenses Paid

Charitable Expenses Paid

Tax Preparation amp Job Expenses

Total Itemized Deductions

Standard Deduction

Excess Itemized Deductions Less

Monthly Tax Savings for AHI Buyer 25

Rate (Itemized Divided by 12 Months Multi-

plied by 25 Tax Rate)

Monthly Total

Monthly Tax Savings for ISA Buyer

Monthly Payments after Deductions

1

$75000

20

$1500

$73500

$441

$83

$75

$50

$649

$4451

$1000

$200

$200

$500

$6351

$5450

$901

$19

$649

-$19

$630

2

$150000

20

$3000

$147000

$881

$83

$75

$50

$1090

$8902

$1000

$200

$200

$500

$10802

$5450

$5352

$111

$1090

-$111

$978

3

$250000

20

$5000

$245000

$1469

$83

$75

$50

$1702

$14837

$1000

$200

$200

$500

$16737

$5450

$11287

$235

$1702

-$235

$1467

PricingHow is the price for each home

determined

The Real Estate Professional works with the AHI Seller

to determine the AHI Calculated Sales Price The Real

Estate Professional uses local market rents to calculate

the purchase price

How is the interest rate determined

AHI recommends that the interest rate be fixed for the

30-year term This means the AHI Buyer will have

the agreed upon interest rate for the entire length of the

ISA contract or until refinance

AHI Buyerrsquos ability to terminate the contract

Things happen Situations change The AHI Program provides a way to

protect your future ability to purchase a home or apply for credit What

does it mean It means no foreclosure If at any time you canrsquot make your

payments or you simply wish to move the AHI Seller can (with certain

restrictions) transfer the ISA to a new buyer The AHI Buyer also has the

right to sell the property ldquoconventionallyrdquo at any time

Job Loss Protection

AHI has arranged for the AHI Seller to buy optional job loss insurance

through the HELP program for up to six months of contract payments

if the buyer involuntarily loses their job

AHI Buyer Benefits

AHI has built a group of nationally recognized and respected corporate

product and service providers to enhance the buying experience AHI

Buyer Benefits are provided to the AHI Buyer at closing The portfolio

delivers discounts on superior products and services

AHI Buyer Benefits

Homeownership though equitable title at closing

Low down payment usually 1-4 of the home value

AHI Calculated Sales Price is based on local market rents

Closing costs are paid by the AHI Seller

First-time home buyer may have a tax credit up to

$8000 (2009 only)

Tax deductions for mortgage interest and property taxes

First-time Home buyer Tax Credit of $8000httpwwwfederalhousingtaxcreditcom site released by the National Association of Home Buildershttpwwwirsgovnewsroomarticle0id=20467100html site released by the United States Internal Revenue Service

Better approach than the typical rent-to-own

and lease-to-own options

Credit repair if necessary

Positive credit reporting

AHI Buyer is working towards building equity

with each payment

Fixed monthly payments based on a 30-year

contract

Refinance at a lower rate if applicable

No prepayment penalty

Termination of contract without credit damage

or foreclosure

Contract is assumable with certain restrictions

Down Payment and typical closing costs for a home purchase

In the AHI system it is recommended the seller pay

all closing costs Previously these costs were typically

shared between buyer and seller

Examples of such costs for a $150000 purchase are

Summary of Closing Costs

Mortgage Costs Loan Origination Fee

Appraisal Fees

Processing Fees

Title Charges

Settlement or Closing Fee

Title InsuranceTitle Fees

Real Estate Taxes

Recording Fee

City Transfer Tax

State Transfer tax

Down Payment

Total Cash Needed to Close

AHI Process

0

0

0

0

0

0

Determined at closing

0

0

0

$3000

$3000

Conventional Mortgage Loan (FHA)

$1500 (1)

$300

$1000

$1500

$200

$1450

Determined at closing

$280

$2250

$750

$4500 (3)

$12230

Conventional Mortgage Loan (non-FHA)

$1500 (1)

$300

$1000

$1500

$200

$1450

Determined at closing

$280

$2250

$750

$30000 (20)

$37730

Typical monthly payment and tax savingsThe AHI Buyer can deduct interest and property tax from their Federal

Income Tax Since this benefit varies with individuals and states a tax

specialist should be consulted for each situation Example

Contract Monthly Payment

AHI Calculated Sales Price

Down Payment (Percent)

Down Payment (Dollars)

Purchase with 30yrFixed 6

Monthly Contract Payment

Monthly Real Estate Taxes

Monthly Homeowners Insurance

Monthly Maintenance

Monthly Total Payment

Estimated Tax Savings

Mortgage Interest Paid

Real Estate Taxes Paid

Medical Expenses Paid

Charitable Expenses Paid

Tax Preparation amp Job Expenses

Total Itemized Deductions

Standard Deduction

Excess Itemized Deductions Less

Monthly Tax Savings for AHI Buyer 25

Rate (Itemized Divided by 12 Months Multi-

plied by 25 Tax Rate)

Monthly Total

Monthly Tax Savings for ISA Buyer

Monthly Payments after Deductions

1

$75000

20

$1500

$73500

$441

$83

$75

$50

$649

$4451

$1000

$200

$200

$500

$6351

$5450

$901

$19

$649

-$19

$630

2

$150000

20

$3000

$147000

$881

$83

$75

$50

$1090

$8902

$1000

$200

$200

$500

$10802

$5450

$5352

$111

$1090

-$111

$978

3

$250000

20

$5000

$245000

$1469

$83

$75

$50

$1702

$14837

$1000

$200

$200

$500

$16737

$5450

$11287

$235

$1702

-$235

$1467

PricingHow is the price for each home

determined

The Real Estate Professional works with the AHI Seller

to determine the AHI Calculated Sales Price The Real

Estate Professional uses local market rents to calculate

the purchase price

How is the interest rate determined

AHI recommends that the interest rate be fixed for the

30-year term This means the AHI Buyer will have

the agreed upon interest rate for the entire length of the

ISA contract or until refinance

AHI Buyerrsquos ability to terminate the contract

Things happen Situations change The AHI Program provides a way to

protect your future ability to purchase a home or apply for credit What

does it mean It means no foreclosure If at any time you canrsquot make your

payments or you simply wish to move the AHI Seller can (with certain

restrictions) transfer the ISA to a new buyer The AHI Buyer also has the

right to sell the property ldquoconventionallyrdquo at any time

Job Loss Protection

AHI has arranged for the AHI Seller to buy optional job loss insurance

through the HELP program for up to six months of contract payments

if the buyer involuntarily loses their job

AHI Buyer Benefits

AHI has built a group of nationally recognized and respected corporate

product and service providers to enhance the buying experience AHI

Buyer Benefits are provided to the AHI Buyer at closing The portfolio

delivers discounts on superior products and services

Down Payment and typical closing costs for a home purchase

In the AHI system it is recommended the seller pay

all closing costs Previously these costs were typically

shared between buyer and seller

Examples of such costs for a $150000 purchase are

Summary of Closing Costs

Mortgage Costs Loan Origination Fee

Appraisal Fees

Processing Fees

Title Charges

Settlement or Closing Fee

Title InsuranceTitle Fees

Real Estate Taxes

Recording Fee

City Transfer Tax

State Transfer tax

Down Payment

Total Cash Needed to Close

AHI Process

0

0

0

0

0

0

Determined at closing

0

0

0

$3000

$3000

Conventional Mortgage Loan (FHA)

$1500 (1)

$300

$1000

$1500

$200

$1450

Determined at closing

$280

$2250

$750

$4500 (3)

$12230

Conventional Mortgage Loan (non-FHA)

$1500 (1)

$300

$1000

$1500

$200

$1450

Determined at closing

$280

$2250

$750

$30000 (20)

$37730

Typical monthly payment and tax savingsThe AHI Buyer can deduct interest and property tax from their Federal

Income Tax Since this benefit varies with individuals and states a tax

specialist should be consulted for each situation Example

Contract Monthly Payment

AHI Calculated Sales Price

Down Payment (Percent)

Down Payment (Dollars)

Purchase with 30yrFixed 6

Monthly Contract Payment

Monthly Real Estate Taxes

Monthly Homeowners Insurance

Monthly Maintenance

Monthly Total Payment

Estimated Tax Savings

Mortgage Interest Paid

Real Estate Taxes Paid

Medical Expenses Paid

Charitable Expenses Paid

Tax Preparation amp Job Expenses

Total Itemized Deductions

Standard Deduction

Excess Itemized Deductions Less

Monthly Tax Savings for AHI Buyer 25

Rate (Itemized Divided by 12 Months Multi-

plied by 25 Tax Rate)

Monthly Total

Monthly Tax Savings for ISA Buyer

Monthly Payments after Deductions

1

$75000

20

$1500

$73500

$441

$83

$75

$50

$649

$4451

$1000

$200

$200

$500

$6351

$5450

$901

$19

$649

-$19

$630

2

$150000

20

$3000

$147000

$881

$83

$75

$50

$1090

$8902

$1000

$200

$200

$500

$10802

$5450

$5352

$111

$1090

-$111

$978

3

$250000

20

$5000

$245000

$1469

$83

$75

$50

$1702

$14837

$1000

$200

$200

$500

$16737

$5450

$11287

$235

$1702

-$235

$1467

PricingHow is the price for each home

determined

The Real Estate Professional works with the AHI Seller

to determine the AHI Calculated Sales Price The Real

Estate Professional uses local market rents to calculate

the purchase price

How is the interest rate determined

AHI recommends that the interest rate be fixed for the

30-year term This means the AHI Buyer will have

the agreed upon interest rate for the entire length of the

ISA contract or until refinance

AHI Buyerrsquos ability to terminate the contract

Things happen Situations change The AHI Program provides a way to

protect your future ability to purchase a home or apply for credit What

does it mean It means no foreclosure If at any time you canrsquot make your

payments or you simply wish to move the AHI Seller can (with certain

restrictions) transfer the ISA to a new buyer The AHI Buyer also has the

right to sell the property ldquoconventionallyrdquo at any time

Job Loss Protection

AHI has arranged for the AHI Seller to buy optional job loss insurance

through the HELP program for up to six months of contract payments

if the buyer involuntarily loses their job

AHI Buyer Benefits

AHI has built a group of nationally recognized and respected corporate

product and service providers to enhance the buying experience AHI

Buyer Benefits are provided to the AHI Buyer at closing The portfolio

delivers discounts on superior products and services

Typical monthly payment and tax savingsThe AHI Buyer can deduct interest and property tax from their Federal

Income Tax Since this benefit varies with individuals and states a tax

specialist should be consulted for each situation Example

Contract Monthly Payment

AHI Calculated Sales Price

Down Payment (Percent)

Down Payment (Dollars)

Purchase with 30yrFixed 6

Monthly Contract Payment

Monthly Real Estate Taxes

Monthly Homeowners Insurance

Monthly Maintenance

Monthly Total Payment

Estimated Tax Savings

Mortgage Interest Paid

Real Estate Taxes Paid

Medical Expenses Paid

Charitable Expenses Paid

Tax Preparation amp Job Expenses

Total Itemized Deductions

Standard Deduction

Excess Itemized Deductions Less

Monthly Tax Savings for AHI Buyer 25

Rate (Itemized Divided by 12 Months Multi-

plied by 25 Tax Rate)

Monthly Total

Monthly Tax Savings for ISA Buyer

Monthly Payments after Deductions

1

$75000

20

$1500

$73500

$441

$83

$75

$50

$649

$4451

$1000

$200

$200

$500

$6351

$5450

$901

$19

$649

-$19

$630

2

$150000

20

$3000

$147000

$881

$83

$75

$50

$1090

$8902

$1000

$200

$200

$500

$10802

$5450

$5352

$111

$1090

-$111

$978

3

$250000

20

$5000

$245000

$1469

$83

$75

$50

$1702

$14837

$1000

$200

$200

$500

$16737

$5450

$11287

$235

$1702

-$235

$1467

PricingHow is the price for each home

determined

The Real Estate Professional works with the AHI Seller

to determine the AHI Calculated Sales Price The Real

Estate Professional uses local market rents to calculate

the purchase price

How is the interest rate determined

AHI recommends that the interest rate be fixed for the

30-year term This means the AHI Buyer will have

the agreed upon interest rate for the entire length of the

ISA contract or until refinance

AHI Buyerrsquos ability to terminate the contract

Things happen Situations change The AHI Program provides a way to

protect your future ability to purchase a home or apply for credit What

does it mean It means no foreclosure If at any time you canrsquot make your

payments or you simply wish to move the AHI Seller can (with certain

restrictions) transfer the ISA to a new buyer The AHI Buyer also has the

right to sell the property ldquoconventionallyrdquo at any time

Job Loss Protection

AHI has arranged for the AHI Seller to buy optional job loss insurance

through the HELP program for up to six months of contract payments

if the buyer involuntarily loses their job

AHI Buyer Benefits

AHI has built a group of nationally recognized and respected corporate

product and service providers to enhance the buying experience AHI

Buyer Benefits are provided to the AHI Buyer at closing The portfolio

delivers discounts on superior products and services

PricingHow is the price for each home

determined

The Real Estate Professional works with the AHI Seller

to determine the AHI Calculated Sales Price The Real

Estate Professional uses local market rents to calculate

the purchase price

How is the interest rate determined

AHI recommends that the interest rate be fixed for the

30-year term This means the AHI Buyer will have

the agreed upon interest rate for the entire length of the

ISA contract or until refinance

AHI Buyerrsquos ability to terminate the contract

Things happen Situations change The AHI Program provides a way to

protect your future ability to purchase a home or apply for credit What

does it mean It means no foreclosure If at any time you canrsquot make your

payments or you simply wish to move the AHI Seller can (with certain

restrictions) transfer the ISA to a new buyer The AHI Buyer also has the

right to sell the property ldquoconventionallyrdquo at any time

Job Loss Protection

AHI has arranged for the AHI Seller to buy optional job loss insurance

through the HELP program for up to six months of contract payments

if the buyer involuntarily loses their job

AHI Buyer Benefits

AHI has built a group of nationally recognized and respected corporate

product and service providers to enhance the buying experience AHI

Buyer Benefits are provided to the AHI Buyer at closing The portfolio

delivers discounts on superior products and services

AHI Buyer Benefits

AHI has built a group of nationally recognized and respected corporate

product and service providers to enhance the buying experience AHI

Buyer Benefits are provided to the AHI Buyer at closing The portfolio

delivers discounts on superior products and services