Questions?
We've got answers.
Frequently Asked Questions
can we buy a home with nothing down?
Yes. We have a number of loan products that require no down payment, while also offering attractive rates and terms. For example, if you’re a veteran our VA & CalVet loans require nothing down. If you’re buying in a rural area (incidentally, that’s 97% of the country) USDA loans require $0 down. We also have a number of specialized products, including grants, that are coupled with Conventional and FHA loans that require nothing down. These are among our most popular products, particularly for first time buyers.
WHAT ARE BANK STATEMENT LOANS? THEY SEEM TO BE EVERYWHERE.
Bank statement loans are a type of reduced documentation mortgage specifically designed for self-employed borrowers. Let’s assume you’re a small paint contractor in Bonita, CA. You primarily paint home exteriors, charge an average of $4,000 per home, and paint 5 homes per month. Your bank statements reflect average monthly deposits of $20,000
(5 homes x $4,000). Of course this is before expenses. Once you deduct materials, insurance, labor, vehicle maintenance, scaffold renting, etc., your taxable income would be significantly less — in fact it may be next to nothing. Instead of basing a lending decision on the TAXABLE income reported on your 1040, we evaluate the CASH FLOW reflected on the bank statements (with certain adjustments). You’re qualified on tax flow rather than taxable income. When it comes to determining the health of your business, the bank statements may be a more accurate representation. When applying for a bank statement loan, tax returns are not requested.
What is pre-qualification?
Pre-Qualification is the process of reviewing your income and debts to determine the amount you have available each month to service a mortgage debt – after you’ve paid your existing obligations. This establishes the maximum price of the home you may be able to buy. PreQualification is NOT a loan approval, but again, simply determines the maximum purchase price of the home you’re eligible to buy.
What is pre-approval?
Pre-Approval means that you have obtained a written lending commitment, subject to certain conditions, prior to searching for a home. Loan approval occurs after your loan application has been underwritten. Underwriting is the formal process of reviewing your present financial status and your financial history (including credit report, pay stubs, tax returns, employment history, etc)., within the context of established lending guidelines and credit scoring models, to determine whether you present an acceptable lending risk.
Pre-Approval differs from Pre-Qualification. As stated before, Pre-Qualification simply establishes the amount you’re eligible to buy. On the other hand, Pre-Approval confirms you meet all requirements and are fully qualified to purchase a home in a certain price range, as evidenced by a written conditional lending commitment. Pre-Approval also means you’re essentially a cash buyer with the accompanying gravitas and bargaining power.
Do I need a home warranty?
Aenean sollicitudin, lorem quis bibendum auctor, nisi elit consequat ipsum, nec sagittis sem nibh id elit.
HOW DOES A DSCR (DEBT SERVICE COVERAGE RATIO) LOAN WORK?
Okay, a debt service coverage ratio loan is a loan that’s underwritten by evaluating the ability of an asset to generate enough income to service its debt. Assume you’re a middle school administrator in Riverside County, CA. You’re single and earn $89,000 per year. You own a home, a car, and you’ve got $40,000 in credit card debt, along with 2 kids in college — you’re stretched financially. Further assume that your uncle dies in Los Angeles and leaves you a small apartment complex with 4 units. The units are worth $1,200,000 and there is a mortgage for $500,000. When reviewing the paperwork you notice that the interest rate on the units is
9.9%, interest-only. So you’re paying almost $50,000 per year in interest and $0 goes toward the principal. You’d like to refinance the units, reduce the interest rate, and get a loan that pays interest AND principal. Of course, since you’re stretched to the max already you’re not sure if a lender will loan you a half million dollars to refinance the units. Enter the DSCR which focuses on the sufficiency of the rental income from the units to primarily pay the mortgage, NOT you as the borrower. Can the rental income from the units COVER THE MORTGAGE DEBT? By what percent (the higher the percent, the stronger the loan application). So if the mortgage payment is $3,000, what percentage of that payment is covered by the rental income. If it’s 100% or more, you’reThe debt service coverage ratio (DSCR) is defined as net operating income divided by total debt service. For example, suppose Net Operating Income (NOI) is $120,000 per year and total debt service is $100,000 per year. … In this example it could be shown as “1.20x”, which indicates that NOI covers debt service 1.2 times. The DSCR measures how much of a company’s debt it can pay with its ongoing revenue. … The company has more annual income than it needs to cover its debt payments. The higher the DSCR rating, the more comfortably the company can cover its obligations. As a general rule, a DSCR of 1.15 – 1.35 is considered good
what do you say to people who are fearful of buying a home?
What would you do if you were not afraid? The process of home ownership and obtaining a mortgage can be daunting. PArt of what we do appears to be shrouded in mysteionOh gosh, where do we start. I’ve spent the last 25 years or so trying to remove the mystery and cryptic nature of our industry. Even after the housing meltdown of 2008 and the ensuing legislation that was to make things better. We found that the 2010 revisions used the same terms of art. Renting a home to renting the money to buy a home … some of what we do is based on common sense, but some of it is neither logical or conducive to understanding by emotional intelligence. That’s why you need a professional. Someone who is skilled in advancing the transaction when bot logic and emotion become useless. The only thing that helps is understanding the animal.
Am I ready to rent?
Aenean sollicitudin, lorem quis bibendum auctor, nisi elit consequat ipsum, nec sagittis sem nibh id elit.
What should I offer?
Proin gravida nibh vel velit auctor aliquet. Aenean sollicitudin, lorem quis bibendum auctor, nisi elit consequat ipsum, nec sagittis sem nibh id elit. Duis sed odio sit amet nibh vulputate cursus.
Can I ask you for advice?
Aenean sollicitudin, lorem quis bibendum auctor, nisi elit consequat ipsum, nec sagittis sem nibh id elit.
- +1 910-626-85255
let's find you together the place you deserve
Click edit button to change this text. Lorem ipsum dolor sit amet, consectetur adipiscing elit. Ut elit tellus, luctus nec ullamcorper mattis.