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Operational Process "Your Dream Home in México"

Your dream home in Mexico. Operational Process "Your Dream Home in México". Your dream home in Mexico. Initial Customer Interview.

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Operational Process "Your Dream Home in México"

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  1. Your dream home in Mexico Operational Process "Your Dream Home in México"

  2. Your dream home in Mexico Initial Customer Interview The Hipotecaria Nacional’a agent or the developer’s sales person, will conduct the interview for the client and explain the general characteristics of the product. Loan Characteristics ▪ Minimal loan amount: $100,000 ▪ Max LTV: 70% ▪ Term: 15, 20 and 25 years ▪ No pre-pay penalty ▪ Minimal customer’s age 18 years

  3. Your dream home in Mexico Initial Customer Interview Credit Approval Guidelines • Minimum Credit Score: 650 Pts. (Fico Score). • Age: 18 years • Establish a checking account with LNB • Payment addressed to LNB • Property Insurance • The Trust annual expenses and insurance premiums are included in the monthly payment through an escrow account.

  4. Your dream home in Mexico Why a Trust Fund ? • Product:The Trust of a Restricted Zone, is the legal Instrumentused for Americans to be able to use and enjoy real estate located on the Mexican coasts as well as borders and guarantee the payment of the loan to the Trust holder in the first place. • Restricted Zone:Article 27th , 1st fraction of the Mexican Constitution states that no foreigner will be able to purchase any land or water in an extent of 100 kms along the borders and 50 kms along the country's coasts or beaches.

  5. Your dream home in Mexico Why a Trust Fund ? • The Permits: The SRE grants credit institutions the permits to purchase real estate within the national restricted zone to allow the use and development of such real estate to the Trust holders. • Term:The Trust institution will always hold the title of the real estate for a maximum period of 50 years that can be extended as long as the real estate property is being utilized with residential purposes. The Trust contract will be stated on public title. • Termination:The Trust can be terminated by ceasing the rights of the property and the new Trust holder will select another bank, or, for transferring the property to a Mexican citizen.

  6. Your dream home in Mexico Initial Customer Interview Customer’s Required Documentation • ▪ Signed Application. • Photo ID (Current Passport or American Driver’s License). • Income tax returns including W2’s for the past 2 years. • ▪ Last 2 payroll stubs. • ▪ Checking account statements for the past 2 months.

  7. Your dream home in Mexico Initial Customer Interview Example for a loan on a $300,000.00usd property Sales Price $300,000 USD Down Payment $ 90,000 30% Loan Amount $210,000 70% Interest Rate 8.875% Term 15 Years Monthly Payment $ 2,114.37 Origination costs aprox. 6.0 %

  8. LNB Fees will be deducted from the customers account at closing

  9. SAMPLE OF CLOSING COSTS ON $300,000 SALES PRICE (U.S. DOLLARS) Trust Fees will be collected from Customers account and transferred to Fiduciario’s account

  10. SAMPLE OF CLOSING COSTS ON $300,000 SALES PRICE (U.S. DOLLARS) Notary Fees will be paid by customer at closing

  11. Your dream home in Mexico Initial Customer Interview ▪The development’s sales agent or the HIPNAL representative should provide the customer with a loan application and checklist. ▪ Guidelines to follow when taking an application. - Explain loan’s general terms - Once the customer has signed the application, the following questions should be asked: Credit history in the US Gross income Customer’s financial situation

  12. Your dream home in Mexico Contact with LNB All documentation must be faxed or emailed to Sandra Salinas at LNB who will also assist us in case there are any questions at the time of filling the application. Sandra Salinas – LNB Mortgage Officer Fax: 956 – 791-6991 Email: mcpmtg@lnb.com In case the customer requires a pre-qualification, it will be enough to fax the signed application. The response time to obtain a pre-qualification is 48 hours.

  13. Your dream home in Mexico Where is the file generated? • Even though the customer resides in the US, the responsibility of creating the file is in the sales force of the developer for the following reasons: • To guarantee that we will provide the established levels of service for the product, it is necessary that all the participant areas(LNB, Fiduciario, Peritos etc. ) have the necessary documentation. • 2. The sales force of the developer is who will maintain a stretch relationship with the customer, which facilitates a timely follow up to the necessary documentation for the loan. The Loan Officer from LNB, will be able to, upon sellers or BHBM request, help with the recompilation of missing documentation, in this case, it is stated that the services start when the file is complete in LNB

  14. Your dream home in Mexico Qualification Process in LNB ▪LNB Mortgage Officer - Review application and documents. - Enter information in Mortgage system. - Obtain Credit Report ( Fico Score ). - Determine interest rate based on the credit score and down payment, considering the following: 25 Year Term: Predetermined rate in rate-matrix 20 Year Term: Discount .250 pts from the predetermined rate 15 Year Term: Discount .500 pts from the predetermined rate

  15. Your dream home in Mexico Credit Approval in LNB Once the interest rate has been calculated and the credit score has been verified, the application will be sent to an Underwriter, who will approve or decline the loan, based in qualification policies and guidelines for LNB. In the case that the loan is declined, the underwrite will ask the loan officer to fix any inconsistencies. The loan has to be declined by two different underwriters to be officially and definitely declined.

  16. Your dream home in Mexico Approved Credit • Once the loan has been approved the Loan Officer will contact the customer to: • Inform him about what rate the loan was approved with • Ask him to open a checking account with LNB. • Ask for payment for the following services. • 1) Appraisal • 2) Trust Establishment • 3) Permits from the SRE • 4) Anticipated Trust Annuity • 5) Inscription in the RNIE • 5) Origination Fee • Remind customer that it is required to have hazardous insurance and offers the services of Seguros Bancomer for such. • Remind him that all notary costs have to be covered at the time of closing. Simultaneously, the Loan Officer from LNB will contact the agent for Hipotecaria Nacional in the corresponding site.

  17. Your dream home in Mexico • Once we have received the approval notice from LNB, we will • follow up on: • APPRAISAL • TRUST PERMITS FROM S.R.E. • SEND INSTRUCTIONS AND PERMITS TO THE NOTARY. • COORDINATION FOR CREDIT CONTRACT SIGNATURE. • COORDINATION FOR TRUST SIGNATURE. • DEVELOPER PAYMENT. • SEND SIGNED DOCUMENTATION TO LNB.

  18. Your dream home in Mexico 1. APPRAISAL • Loan Officer will solicit the appraisal of his technical area (ARU). • ARU will ask for the appraisal via email to H.N. through the Dirección Adjunta Técnica (DAT) in corporate office ( Juan Javier Gutierrez, is responsible in México for this appraisals ). • DAT, Assigns the person in charge of the appraisal in it’s corresponding area. • Appraiser will contact the HN staff to receive all necessary documentation for the appraisal. • Appraisal will be completed and send to DAT via email. • DAT will resend the appraisal to ARU after having reviewed it. • ARU will receive the appraisal via email, validate it and expedite the Vo. Bo. • Loan Officer will pay HN for the appraisal to the account in LNB.

  19. Your dream home in Mexico Required documentation for the Appraisal and Trust • Escritura de la propiedad • Regimen de propiedad en condominio ( En su caso ) • Acta constitutiva • Poder del representante legal • identificación oficial del representante legal ( Credencial de elector, pasaporte vigente, cedula profesional con antiguedad no mayor a diez años, matricula consular ) • Comprobante de domicilio • R.F.C. • Croquis de ubicación del inmueble determinando la distancia en que se encuentra de la zona federal maritima.

  20. Your dream home in Mexico 2. OBTAINING PERMIT FORM THE SRE • The HN oficer will contact the Trust Promotion executive in it’s corresponding area. • Proportionate the following customer’s information to be consulted on the OFAC. • Full Name • Social Security Number (SSN) or Individual Tax Identification Number (ITIN). • Address. • The trust’s promotion executive will verify the customer's information on the OFAC list. • In case any coincidences are find we will obtain further information from the HN oficer, otherwise he will approve the prospect in the trust system and notify the administration. • The trust’s administration executive will validate the payment receipt and request the permit from the SRE. • Once the permit has been received (average of 16 business days), it will be sent via email and FEDEX to the HN oficer.

  21. Your dream home in Mexico 3. NOTARY INSTRUCTION • Once the LNB, has the appraisal, the following documentation will be prepared: • Credit/Loan Agreement • Notary Instruction for the trust's constitution( Restricted Zone and Guaranty ). • LNB, will send the credit/loan agreement to the HN officer • HN Officer receives the documents from LNB, SRE permit and Bancomer Trust and will instruct the corresponding Notary. • Notary will realize the trust project and send it to the HN officer for final validation. • HN officer will turn the trust project to the legal area to obtain the Vo.Bo. (Attention Normando Ramirez, maximum response time is 24hrs). • Obtain Vo.Bo. On the trust project and schedule the signature date for the credit/loan agreement signature 24 hours in advance of the trust signature.

  22. Your dream home in Mexico 4. Credit/Loan Agreement Signature and Payment • HN Officer will conduct the credit agreement signature and payment, with 24 hours in advance of the trust signature. ( This is a private document and does not need to be signed before the public notary). • In the same appointment he will get signatures for the hazardous insurance. ( If needed). • Once the customer has completed the signatures, A scaned copy must be send to Sandra Salinas at LNB, requesting the funds transfer. • LNB, will make the deposit in the amount of the loan established with the Bancomer trust, notifying via email the HN officer and the trust’s administration executive. • Trust’s administration will verify the deposit and prepare the transfer to the developer, waiting for the confirmation of the date for the Trust signature.

  23. Your dream home in Mexico 5. Trust Signature • HN Officer (LNB representative) will proceed to the trust signature with a public notary. • Confirmation via email to trust’s administration. • Trust’s administration executive will make the transfer to the developer’s account. • HN Officer, will send via email the signed documentation to LNB and FEDEX a copy to the branch in Nuevo Laredo. • LNB will collect the payments through normal procedures utilized for mortgage loans in the US.

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