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YOUR FRIEND INMORTGAGE!YOUR F RIEN D IN MOR TGAG E! H ello , I amAl ly C ain, Sen ior Mort gage Ban ker with All yCa in M ortg age Team pow ered by Atla nticBa y Mo rtga ge G roup in the Tria d, N C ar ea.Af ter rece ivin g my bac helo r's degr ee f romAp pala chia n St ate Univ ersi ty, I st arte d myca reer in the fina ncia l in dust ry i n th e au tofi nanc ing real m be fore mov ing to t hemo rtga ge i ndus try in 2 020. I h ave spen t th epa st s ever al y ears cra ftin g my bra nd, whic hha s de fine d me as an e ffic ient andef fect ive work er, brin ging tra nsac tion sto geth er. This exp erie nce has prop elle d meto bec ome the “go to” lend er t hat clie ntsan d re al e stat e pr ofes sion als trus t. I hav esu cces sful ly a ssis ted clie nts navi gateth roug h th e ho me b uyin g pr oces s,as sist ing seve ral hund red fami lies obt ainho meow ners hip. I h ave been con sist entl yre cogn ized as the Top Mort gage Ori gina torin my regi on. I ha ve e stab lish ed a vas tba se o f pa st c lien ts, real tor part ners ,fi nanc ial plan ning par tner s bu t mo stim port antl y fr iend s du ring my care er. I li vein Lex ingt on, NC w ith my t wo c ocke rsp anie ls - Oli ver and Mill ie. In m y fr ee t ime,I enjo y vi siti ng B oone , NC for App alac hianSt ate Foot ball gam es.33 6-47 9-23 24ap plyw itha lly. comal lyca in@a tlan ticb ay.c om59 58 O ld U S Hw y 52 , Su ite A Le xing ton, NC 2729 5@a pply with allyhello there!

INT RODUCTIO NMEE T THE AL LY CAIN TEAMAN OVERVIEWMOR TGAGE PR OCESS - STEP 1: PRE- APPROVAL & APPLI CATION - STEP 2: FIND A HOME - STEP 3: COND ITIONAL APPROVAL - STEP 4: FINA L APPROV AL - STEP 5: CLOS INGCOS TS INVOL VED - MONT HLY MORT GAGE PAY MENTS - CLOS ING COST STYP ES OF MO RTGAGES - CONV ENTIONAL MORTGAG ES - GOVE RNMENT-B ACKED MO RTGAGES - DOWN PAYMENT ASSISTA NCEQUA LIFICATI ON CRITE RIA - RELI ABLE SOU RCE OF I NCOME - DEBT - TO - INCOME R ATIO - CRED IT SCORE - DOWN PAYMENTSTE PS YOU S HOULD TA KE TODAYGLO SSARY OF TERMS THA NK YOUcontent

Meet the Ally CainTEAMAlly CainSenior Mortgage Loan OfficerNMLS# 1944301Madison McCallaLicensed Production PartnerNMLS# 2464668Amanda CaseyProcessor

Bu ying a h ome is an e xcit ing proc ess but it can be v ery chal leng ing and tir ing if y ou d on’t unders tand themo rtga ge p roce ss. At time s, y ou m ight feel overw helm ed w ith the amo unt of d ocum enta tion re quir ed a ndat oth er t imes you mi ght feel los t ab out the pro gres s in you r ap plication.Th is g uide wil l help you to u nder stan d th e mortg age proc ess in d etail – sta rtin g fr om a step by st ep e xpla nati onof the mor tgag e proce ss, to t he f acto rs t hat aff ect your mor tgag e appli cati on, to w hat steps you c an t ake topr esen t a stro ng appl icat ion.I hope thi s gu ide will ma ke t he e ntir e pr ocess o f mo rtga ge l ess intimid atin g to you . It wil l prepa re y ou i n kn owin gwh at t o ex pect so that yo u ha ve a n ov erall pleas ant expe rien ce i n your home buy ing jour ney.an OVERVIEW

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D E T E R M I N EY O U R B U D G E TYour monthly payments (ho use, car, student etc.) in total should not be mor eth an 45% of your pret ax i ncome. Anything more than th at a nd you are likely to st ress your finances.Once you know your bu dget, you will submit a mor tgage application to ou r team.You can apply using t he Q R Code to the left or a t www.applywithally.com  We will check your employment history, your asse ts (if necessary), and yourcr edit score. This helps us understand and show that you have the finan ces toback your offer.Once this is complete , we will set up a time to consult with you on wha t optionsar e available to you.M O R T G A G EP R E - A P P R O V A LThe application is the fo rmal beginning of your mortgage journey.Th e pre-approval letter i s va lid for a period of 120 days.  pre-APPROVAL& applicationstep 1 : M O R T G A G EA P P L I C A T I O N A P P L Y N O W

C O N T A C TY O U R R E A L T O RAt this point, we have ma de the determination of what loan options you haveavailable to you.  Our next step is to call your realtor and walk them through what your g oals are sowe are all on the same pa ge. If you do not have one, then we are more t han happyto make a recommendat ion.T I M E T O S T A R TS H O P P I N GM A K I N G A NO F F E RNow that we know how we will finance your ne w home, it is time to startshopping. Your realtor will ask you all kinds of questions , in cluding what location y ou want,how many bedrooms/bat hrooms you would li ke, how many square fee t yo u need,and what kind of amen itie s you would like to be happy. Your realtor will set you up on an automatic lis t of homes so you can k now whatis happening in the housi ng market. Your realtor will also sc hedule any home showing s you want so that you can lookat the homes in perso n. Now, you get to find the home of your dreams .Next step is to work clos ely with your realtor a nd us to make the best offe r foryou and the seller so you get the home. Find a Homestep 2 :

P R O V I D ED O C U M E N T SWe will ask for documents related to your employ ment status, income , ot herassets, etc.  It is a good idea to be i n close touch with us durin g this time and providedocuments as soon as possible so that delays don’t occur.C O N D I T I O N A LA P P R O V A LH O M EA P P R A I S A LOnce we have the requ ired documents, we will sub mit your file to an und erwriterwho will determine yo ur o fficial approval. Conditions are a term we use to describe the che cklist required to docu ment acomplete file per the Pro gram Guidelines. Each l ine item is a condition .Once approved, we wil l co me back to you with anything that may be needed forth e underwriter to contin ue completing the appli cation. Once we have all the cond itions that are require d for final approval, we wi ll movein to the final stages.During the Conditiona l Ap proval time, the home a ppraisal will happen. It wi ll bear ranged by our team.This process will take an ywhere from 7-10 days a nd the appraiser will s end there port directly to us.  Check with us to make sure the appraisal value i s equal to or more than thepurchase price. If it is less than the asking price, you will have to pay t hedi fference from your pock et or renegotiate the c ontract price with the sell er.conditional approvalstep 3 :

I T T A K E ST I M E T OA P P R O V EIt could take a few days or a few weeks to go fr om conditional approval to finalapproval.  Once everything is in ord er and all conditions a re satisfied, the approval should cometh rough in 3-4 business d ays. While it is our go al t o provide results in 3- 4 days,extenuating circumsta nces may cause delays o utside of this window. We call thisCl eared To Closed.W E A R E AT E A MC L O S I N GD I S C L O S U R EIt is impo rtan t th at y ou w ork clos ely with us to g et y ou t he f aste st r esul ts.  So meti mes you can’ t sa tisf y th e co ndit ions you rsel f. H ome appr aisa ls a nd t itlese arch es d epen d on thi rd-p arty ser vice s. D o no t wo rry. We hand le t hat.We wil l fo llow up with the ser vice pro vide rs t o se e th at p rogr ess is m ade prom ptly .  We wil l al so p erfo rm c redi t ch ecks dur ing the proc ess. The se a re s oft pull ed, justmo nito ring to make sur e th e cr edit rep ort rema ins the same . Em ploy ment che cks will be done thr ough out the proc ess as w ell to m ake sure youdo n’t chan ge j obs duri ng t his peri od.Once the loan is final ap proved, you will receive a Closing Disclosure (CD) . This is a5- page document that discloses the final informa tion: Mortgage Amount Projected Mont hly Payments Closing Costs Cash to Close  You will receive it at le ast 3 days before the closi ng. So you can double-c heckeverything and bring to o ur attention any discre pancy you may see.final approvalstep 4:

Review and sign all your loan documents. Make sure you understand theterms of each document. If something is different from what you expectedor agreed to, don’t sign until you resolve the issue.You will give a certified or cashier’s check to cover the down payment (ifapplicable), closing costs, prepaid interest, taxes, and insurance. You couldalso send these funds in advance via a wire transfer.  Your lender distributes the funds accordingly, covering your home loanamount to the closing agent.S I G N A L L T H EL O A N D O C U M E N T SOnce the closing appointment has finished, you will receive the keys toyour new home. Depending on the arrangement with the seller, you could move inimmediately or may have to wait if the seller has asked for some time tovacate.Your first monthly mortgage payment will start one full month after yourclosing date. I.E., if you close in July, your first payment is due inSeptember.C O N G R A T U L A T I O N S !closingstep 5 :

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Your monthly mortgage payment is usually due at the beginning of the first full month after closing and everymonth thereafter.  In the case you closed at the beginning of the month, you will have a long hiatus before that payment comesdue.Wh at h appe ns w hen you mis s a mort gage pay men t?Usually, the mortgage payment is due on the 1st of the month. You also have a grace period of 15 days incase you are not able to make a payment due to any reason.Now, if you still get late by more than: 15 days: The lender may charge a late fee. The late fee will usually be a percentage of yourmonthly payment.  30 days: The lender will report the late payment to credit bureaus and your credit scored mightdrop by 50-100 points.45 Days: The lender is required to appoint someone on your case to inform you of your options.  60 Days: You will be hit with a second late fee.90 Days: The Lender will call you to inform you that foreclosure proceedings might start.120 Days: Lender may initiate foreclosure proceedings.mortgage paymentsmonthly

Buyers can usually expect to pay about 2.5-4%, percentages may vary, of their purchase price in closing costs.So, if you’re buying a home listed for $200,000, you can expect to pay $5,000-$8,000 in closing costs. The reasonfor the variance will be due to the purchase price. Many fees are set fees. So the larger the loan amount, the lessthe percentage.Most buyers pay closing costs as a one-time, out-of-pocket expense when closing their loan. The seller can alsopay the closing costs as part of the initial contract agreement.P R O P E R T Y R E L A T E D C O S T SAp prai sal: This will be mandated by the lender to make sure the home is worth the sales price.Most appraisers charge $500-$650for their services.  Es crow Fee s:You may have to pay portions of property taxes and insurance upfront into an escrow account. Ho me I nspe ctio n:Depending on the square footage and type of inspection, the buyer pays $350 to $1,000 for a home inspection tolook for signs of damage and defects. This is a very important step as this protects YOU from potential issues.  Pr oper ty T axes :At closing, the buyer typically pays the city and county property taxes due from the date of closing through theend of the tax year.Ti tle/ Atto rney Fee s:This includes necessary government filing fees, escrow fees, notary fees, and other expenses related totransferring the deed.Le nder Fee s:These cover items ranging from administrative costs, to pulling your credit report, to wire transfer fees.Pr epai d In tere st:This is daily interest that accrues on the loan between the closing date and the first monthly mortgage payment.Di scou nt P oint s:You may pay the lender a fee for bringing down the interest rate. Buying one point costs 1% of your mortgageamount (or $1,000 for every $100,000). 1 point is not directly correlated with a 1% decrease in your interest rate.Ti tle Sear ch F ee:Paid to the title search company that researched the property’s history to make sure the title (ownership) will be“clear.” Ti tle Insu ranc e Fe e:This is insurance that protects the lender and owner from any mistakes during the title search process. Itprotects you from survey discrepancies, title claims, etc.L O A N R E L A T E D C O S T Scostsclosing

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3 0 -YE A R F I XED - RAT E MO R TGA G E1.Interest rate never changes.  Lower monthly payment when compared to a 15-year fixed-rate mortgage.S u i t a b l e f o r : Homebuyers who want the lower monthly payment that comes from stretching out repaymentover a long time.2. 15- Y EAR FIX E D-R A TE M ORT G AGE  Often used for refinancing.Interest rate is set for the life of the loan.Higher monthly payment when compared to a 30-year fixed-rate mortgage.S u i t a b l e f o r : Refinancers and homebuyers who want to build equity and pay off the loan faster.3. ADJ U STA B LE- R ATE MOR T GAG EAn adjustable-rate mortgage is a home loan with an initial rate that’s fixed for a specified period, then adjustsperiodically. For example, a 7/1 ARM has an interest rate that is set for the first seven years and then adjustsannually.Initial rate is lowerthan on most other loans for qualified borrowers, giving comparatively lower monthlypayments at first.Initial rates can often be locked for one, five, seven, or 10 years.S u i t a b l e f o r : Buyers who don’t plan on having the mortgage for a long time or who believe interest rates willbe lower in the future.4.  JUM B O M O RTG A GEJumbo home loans, are mortgages above the conforming Fannie Mae limit. These are also known asconventional non-conforming mortgages.Can have fixed or adjustable rates.Often require a credit score of 700 or higher.Usually require a down payment of 10% or more.S u i t a b l e f o r : Buyers of expensive homes and owners who want to refinance jumbo-size mortgages.NOTE: Additional qualifications may be required. Qualifications may vary.mortgagesconventional

1. FHA MOR TGAG E  Home loan insured by the Federal Housing Administration. Allows down payments as low as 3.5%.Credit scores as low as 600 can qualify.Mortgage insurance premium payments are required.Additional qualifications and restrictions may apply. Qualifications may vary.S u i t a b l e f o r : Buyers with lower credit scores and a down payment of less than 20%.2. VA MORT GAGE VA loans are mortgages backed by the Department of Veterans Affairs and are available to military servicemembers and veterans.No down payment required.Upfront VA funding fee required unless you have a service-related disability.No mortgage insurance.Additional qualifications & restrictions may apply. Qualifications may vary.S u i t a b l e f o r : Military-qualified borrowers.3. USD A mo rtga ge  USDA home loans are mortgages backed or issued by the U.S. Department of Agriculture.No down payment is required.Income limits and property value caps apply.Low mortgage insurance as compared to FHA.Additional qualifications & restrictions may apply. Qualifications may vary.S u i t a b l e f o r : Income-qualified buyers in rural and some suburban areas.mortgagesgovernment-backed

N C H F A O R N O R T H C A R O L I N A H O U S I N G A G E N C Y   NC Hom e Ad v ant a ge M ort g age provides qualified individuals with stable, fixed-rate mortgages and downpayment assistance.You may be eligible for $15,000 in down payment assistance with the NC 1st Hom e Ad v ant a ge P rog r amIf you are a First Time Home Buyer or Military VeteranHas a 0%, deferred second mortgage, which is forgiving 20% per year at the end of years 11-15, withcomplete forgiveness at the end of year 15. As an added bonus, if you are a first-time buyer or a Military Veteran, you may also be eligible to combine theNC Home Advantage Mortgage with the NC Hom e Ad v ant a ge T ax C red i t which could save you up to $2,000 peryear on your federal taxes if you apply and are approved for a Mortgage Credit Certificate by the NC HousingFinance Agency prior to your home purchase. *Cannot be combined with the NC 1st Home Advantage Program.**Information found on nchfa.com/home-buyers down paymentAssistance

To qualify for a mortgage, you should have: A reliable source of income A satisfactory debt-to-income ratioA fair or good credit score A down payment (if applicable)criteriaqualification

Every lender’s biggest concern is whether you have a steady source of income through which you can pay backthe loan. The income source needs to be verifiable. So it can be: An income from work Social security Income Alimony or child supportIncome from rental properties, etc.The income needs to be steady for 2 years for it to be considered part of your regular income. So if you earned aone-time bonus or earned money through a part-time job, it has to be consistent for at least 2 years otherwise itwill not be considered. There are some additional options that we can discuss further with you.You can provide the following as proof of your income:  Tax returns W2s or 1099 forms from employers or companies that pay your business  Pay stubs  Bank statements of incomereliable source

Your debt will affect the likelihood of you paying a loan.How to calculate it?1. Add up the amount you pay each month for debt and recurring financial obligations - minimum payments on credit cards, car loans, Personal loans, and any other loans i.e. student loans - Don’t include utility payments i.e. phone bills and electricity bills etc. or household expenses as they are not debts.2. Add projected mortgage payment to your debt total from step 13. Divide that total number by your monthly pre-tax income. The resulting percentage is your debt-to-income ratio. Ideally, this ratio should not be more than 45%. Some lenders may give you a loan even when you exceed thisratio but for your long-term financial health, it should be below 45%. Each program has its maximum ratio, up to56.99%.incomedebt - to -

Yourcredit scoreis determined based on your borrowing and repayment history. Credit scores range from 300 to850.30 0- 5 79 (Poor Credit ): It will be very difficult or impossible to get a mortgage loan.58 0-66 9 (Fair Credit) : You'll likely be able to qualify for some types of mortgages, but the terms won't be great.Government-backed loans may be easier for you to obtain than conventional loans.67 0-73 9 (Good Credit) : You should have a variety of lenders to choose from, and the rates and terms they'll offerwill be reasonable.74 0-79 9 (Very Good Cr edit ):You'll get favorable rates and terms from many lenders.80 0-85 0 (Excellent Cr edit ): You'll likely find it easy to qualify for a mortgage with the lowest rates and bestterms from any lender.scorecredit

Finally, adown paymentis one of the last key requirements necessary to qualify for a mortgage. A down paymentis the money you pay upfront and out of pocket for the home.Lenders typically want proof of where your down payment comes from. Acceptable sources of funds include: Checking or savings accounts  401(k)s or IRAs  Investments including stocks or bonds Trust accounts  Cash-value life insurance  Gifts, so long as the money isn't a disguised loan from friends or familypaymentdown

1. WOR K ON YOU R CR EDIT SCO REA high credit score when you apply for a mortgage could save you thousands of dollars in interest over the life ofyour loan.How to improve your credit score before you apply for a mortgage?Don’t max out the credit cards. Keep your credit utilization to below 30% i.e. your outstanding balance shouldnot be more than 30% of your overall credit limit.  Don’t default even if it is a tiny payment. Defaults hit the credit score badly. Make a calendar reminder tomake your payments on time.  Pay off your credit card debt in full every time.  Do n’t open a n ew l ine of c redi t. Applying for new credit temporarily lowers your credit score.2. INC REAS E YO UR I NCOM EIf your current income doesn’t allow you to apply for the desired mortgage, then try to find a job that willmake you eligible to apply for that mortgage.Lenders like to see a steady employment history so you will have to spend some time in the higher income toapply for the higher mortgage.  Getting a part-time job on top of your full-time job may not provide what lenders consider qualifying incomesince part-time jobs are considered temporary. They may consider it in case the part-time income has beensteady for more than 2 years.  3. SAV E, S AVE & SA VE  The larger down payment you can do, the better your loan application looks.  For almost a year before you buy the house, you start to live as if you are already paying that new mortgage.This means that in addition to your rent, the difference between your rent and assumed future mortgagepayment into your savings account and treat it as you would any other monthly bill.If you are finding it hard to save, start by reducing expenses by 10% across the board. So if your grocerybudget is $ 400/month, bring it down to $360.Finally, buying a home is like a marathon and not a sprint – it takes time to save money for the down paymentand then takes time to pay off your mortgage. So give yourself enough time and soon you will be through all thestages to become a proud homeowner.take todaysteps you should

Am orti zation: Paying off a loan over some time and at the interest rate specified in the loan documents.Es crow : A deposit by a borrower to the lender of funds to pay property taxes, insurance premiums, and similarexpenses when they become due.Li en: A claim or charge on property for payment of a debt. A mortgage is a lien, meaning the lender has the rightto take the title to your property if you don’t make the mortgage payments.Lo an E stimate: A document that provides you with an estimate of the costs associated with your mortgage loan,as well as some other features of your loan. Your loan officer must provide you with a Loan Estimate within threebusiness days of submitting the loan application. Co nven tional loan: A home loan that is not insured or guaranteed by the federal government. A conventionalloan can be for conforming or non-conforming loan amounts.Co nfor ming loan: A mortgage loan that has the standard features as defined by (and is eligible for sale too)Fannie Mae and Freddie Mac.No n-Co nforming loan: A mortgage loan that exceeds the standard features as defined by Fannie Mae and FreddieMac. The jumbo loan is a non-conforming loan.Go vern ment Loan: A loan that is insured by FHA, VA, or USDA.Lo an-t o-Value (LTV): A ratio that expresses the amount of the mortgage as a percentage of a property’s total appraised value.Pr ivat e Mortgage Insu ranc e (P MI): A form of insurance that lenders generally require when borrowers make down payments that are less than 20%.of termsglossary

5958 Old Hwy 52, Suite A, Lexington, NC 27295 | Atlantic Bay Mortgage. All rights reserved. NMLS ID #72043(http://www.nmlsconsumeraccess.org). Interest rates and products are subject to change without notice and may or may notbe available at the time of loan commitment or lock-in. Borrowers must qualify at closing for all benefits. Ally Cain, Senior Mortgage Banker, NMLS# 1944301 you!thank33 6-47 9-23 24ap plyw itha lly. comal lyca in@a tlan ticb ay.c om59 58 O ld U S Hw y 52 , Su ite A Le xing ton, NC 2729 5@a pply with ally