OVERVIEW:
REAL ESTATE LENDERS: Presently, we are fortunate to have plenty of credible and, now (*since the 2008 subprime mortgage crisis), responsible lenders or the types of loans that that they offer. Which is a great for the consumer, as it promotes the development of innovative new loan products, and helps keep the lender’s points and fees in check, too, as they compete to earn business.
But, with so many loan variations and possible lenders, how you know which combination is right for your specific situation? That oftentimes is a nuanced and
MORTGAGES AND HOME FINANCING LOANS:
FINDING THE RIGHT LENDER AND LOAN TYPE:
Call or Text Jack Schoberg at (310) 933-2376
or
Email at jack@jackschobergrealestate.com
Mortgage Calculators
Use our mortgage calculators to help determine the best loan and repayment plan for you.
INFORMATION ON REAL ESTATE MORTGAGES & HOME LOANS
Conventional Mortgages
• Most common durations are 30-year & 15-year. Slightly less common but also usually available are 40-year or 10-year length mortgages.
• Fixed-rate loans w/ lower interest rates on shorter duration mortgages.
• A range of down payment options are usually acceptable, including savings, a home equity loan from a unique property that you own, personal or car title loans, gifts, and down payment assistance programs.
• Between 5%-20% down payment is usually required. Private Mortgage Insurance or PMI is required on amounts less than 20%.
• PMI is charged until 20% of the principal balance has been paid off, at which point it can be requested to be removed.
• Often a low origination fee, or no fee at all.
• Average time from loan application to funding is 6 weeks, but it’s possible to close in 30 days or less when on a tight schedule.
• Not government-insured or offered by a government agency (such as FHA or VA).
• Usually harder to qualify for than alternative loans. The minimum credit score is 620 (with a bigger down payment) and 680 unless putting down more than 10%. A debt-to-income ratio of 50% or less is required.
Alternative Financing
What is Alternative Financing?
Alternative financing is loans made by private lenders to borrowers who might not qualify for a mortgage from the bank. Although interest rates are often a few points higher, it may still be worth taking ownership of a real estate asset sooner than you could otherwise to start building equity if it appreciates.
• A FICO score of at least 620 is usually required
• Loan-to-value ratio of up to 90% with most lenders
• Qualify with 12 months Bank Statement
• 80% Loan to value cash
• Fixed & 30yr/40yr Interest Only Options
• Cash Out for Reserves OK
Government HOME Loans
• FHA Loans: An FHA Loan is a mortgage insured by the Federal Housing Administration. They allow borrowers to finance homes with down payments as low as 3.5% and are especially popular with first-time homebuyers.
FHA loans are a good option for first-time homebuyers who may not have saved enough for a large down payment. Even borrowers who have suffered from bankruptcy or foreclosure may qualify for an FHA-backed mortgage.
• VA Loans: VA loans help service members, veterans, and eligible surviving spouses become homeowners. They provide housing-related programs to help buy, build, repair or adapt a home for service members’ personal occupancy.
VA home loans are provided by private lenders, such as banks and mortgage companies. The VA guarantees a portion of the loan, enabling the lender to provide more favorable terms.
• USDA Loans: Like the Department of Veterans Affairs (VA) and the Federal Housing Administration (FHA), the United States Department of Agriculture (USDA) also provides a mortgage option – the USDA loan.
The USDA loan is a lesser-known mortgage program that allows eligible rural and suburban homebuyers to finance a home without a down payment. Remember, the USDA loan differs slightly from other mortgage programs and has eligibility requirements for location and income. See eligibility requirements here.
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