If you’re considering purchasing a home anytime soon there are a few important steps you absolutely should do before completing a home loan application. Your credit score and the amount of your down payment play an immense part on your home loan terms.
The lender needs to determine how much a risk you are based on your financial responsibility and the higher your credit score is, the better risk you are.
In addition, the higher your credit score the more likely you will be eligible to get the best interest rate so it is a smart move to increase your score as much as possible by being financially responsible.
The maximum credit score is 850. Here is a breakdown of credit scores-
• Excellent credit – above 740
• Very Good credit – 700-740
• Okay credit – 660-699
• Fair credit – 620-659
• Bad credit – below 620
For those looking to buy or refinance a home you should meet the minimum credit score requirement of 620 for traditionally documented loans and 680 or higher for most jumbo loan programs.
If you’re working on boosting your credit score, there’s a few ways to increase it. One of the best strategies is to pay down any balances on credit cards and of course make your payments on or before the due date.
There’s certainly a few more great tips to raise your credit score you may not know about. You just need to know where to look or who to speak with.
Are Credit Karma credit scores accurate for buying a house? More than 90% of lenders prefer the FICO scoring model, while Credit Karma uses the Vantage 3.0 scoring model. Overall, your Credit Karma score is an accurate metric that will help you monitor your credit — but it likely won’t match the FICO scores a lender looks at before giving you a loan.
Which FICO score models do most mortgage lenders use? In all of the residential mortgage credit reports I’ve seen, lenders use Equifax Beacon 5.0. Experian/Fair Isaac Risk Model V2 SM. TransUnion FICO Risk Score, Classic 04.
A large majority of lenders use FICO 2, 4 and 5 scoring models to run a prospective borrower’s credit. These are all found in the residential mortgage credit report (RMCR).
The RMCR normally includes information about your past employment, addresses where you’ve lived and any legal filings such as bankruptcies, foreclosures, judgments, or tax liens. This helps the mortgage lender cross reference what’s is shown or omitted on your loan application.
Mortgage Credit Score vs Consumer Vantage Score Vantage score provided by banks and credit card company’s monitoring service gives you a FICO score alternative through a partnership among the three credit bureaus — Equifax, Experian, and TransUnion.
The most important difference between FICO scores and Vantage scores is the range of scoring. Vantage scores vary from 501 up to 990, while FICO scores start at 300 to a maximum of 850. These are huge differences. As you can see, the Vantage score from your credit monitoring service could be substantially higher than a FICO score the lender pulls. In short, this means do not rely on Vantage scoring when shopping for a mortgage.
Although your Vantage score will give you a credit score, it is not the score used by mortgage lenders. In a large number of cases, it has not been very useful score to consumers.
We’ve worked with borrowers where their Vantage score (obtained from CreditKarma) are 30-60 points different (higher) than what a mortgage lender gets. There are worse reports than that, if you go to some of these forums to read people’s experiences. https://www.creditkarma.com/question/credit-karma-score-was-100-points-higher-than-what-the-2-bureaus-show/ https://www.creditkarma.com/question/beware-of-credit-karma-accuracy-for-your-scores-not-likely-to-be-true/ https://www.cnbc.com/2019/05/10/those-credit-scores-you-see-may-not-be-what-lenders-use.html https://www.reddit.com/r/personalfinance/comments/b6d0fw/creditkarma_score_is_significantly_different_than/
It really is a headscratcher why people continue to pay for a service with highly inaccurate scoring when you can get exactly what you want with MyFICO.com. They offer credit monitoring and you can select the exact FICO version, 2, 3 or 5 and be pretty close to what a mortgage lender will pull. Sign up to monitor all 3bureaus because sometimes one bureau may not have removed an error on your report.
While you can remove the error during the mortgage process, it could delay the closing date, or even worse, you may be at risk of losing your earnest money deposit on a purchase contract because your credit is not in order.
Here’s an example below.
Your lender pulls your scores, and they tell you your credit scores are 767, 715, and 692. Let’s say the rate is much lower if you have a 720 or higher middle score. They inform you there’s a collection of $2,400 that you know was paid and never late.
You have the creditor’s letter stating it was paid in full. However, the letter was only sent to TransUnion, and not Experian and Equifax showing scores of 715 and 692. The lender informs your Experian score will increase to 772 estimated if this collection is removed.
To get this corrected quickly the loan originator advises you to do a “Rapid Rescore” which costs $30 per bureau and $35 for 24-hour turn-around. You go ahead and pay for both bureaus $130 to be on the safe side. This oversight by the borrower delays the mortgage process by 2-3 days. The cost to monitor all 3 bureaus is just $100 and well worth the cost.
Keep in mind just because you were approved for a credit card or auto loan, it doesn’t mean you’ll be approved for a mortgage. Lending guidelines for a credit card or vehicle are different and not as specific as for a mortgage.
Some credit card companies require a minimum credit score of 700, 660, etc, based on the FICO Bankcard scoring or the FICO Auto score for financing a car or truck.
FICO 8 vs. Mortgage Score A couple of things about FICO scores is it can become pretty confusing because some financial reports claim there are up to 56 different versions of your FICO score. According to MyFICO.com, the FICO Score 8 is the most commonly used.
UPDATED: Dec. 12, 2021 Lots of homeowners will make the all-important decision to refinance their home loan after taking title as owner due to multiple reasons. Most often it is because of home appreciation. This is especially true in California where home prices have risen on average by 20% since 2015.
A homeowner may refinance their first and second mortgages into one loan in order to have one single payment. Some of the benefits include reducing your monthly mortgage payment by obtaining a lower interest rate, paying off other debt much faster and taking out equity for home improvement projects and more. If you are wondering what do you need to do to begin the process, read more below.
Determining if You Can and Should Refinance
The first thing you should do is know what your existing loan terms are, such as the interest rate, balance owing, and years left. If you will be refinancing a first and second lien, compare all of the terms together not excluding fees. A lot of loan programs which have great rates demand that you have a minimum of 20-percent equity in your home or 80-percent loan-to-value (LTV).
This means you’ll need to review your property’s current value to see if you meet this condition. Sometimes homeowners feel their property is worth more and later discover that they need to have more equity, have to come bring in more cash to close, or use a loan program that allows refinancing over 80 LTV and there are plenty that do.
• Your Credit Score Similar to buying a home, your credit score is an important factor when refinancing a mortgage. A credit score of 620 is the standard to refinance your home or else the rates are higher than expected.
If you are refinancing an FHA loan, only a 580 credit score is needed and you still get attractive rates. If you are wanting to get cash out, the credit score minimums is typically higher at 660 or more.
• Length of Time for the New Mortgage Do you really need to refinance into a 30 year fixed rate if you only plan on staying in the home for five or seven years? A 7- or 10-year adjustable rate mortgage (ARM) usually has a lower interest rate amortized over 30-years and stays fixed for seven or ten years. After that, it will adjust up or stay at the floor rate based on what the market is doing.
Don’t automatically assume the 7 or 10-year fixed is lower than the 30-year fixed. Mortgage lenders sometimes have products where the rate on the 30-year is the same as the 10-year and only .125% more than a 7-year fixed ARM.
This will vary with which mortgage company you get your loan from. If your plan is to only stay in your home for two years or less, it’s probably not going to be worth refinancing unless you get a no-cost refinance at a lower rate and similar payoff term.
• Closing Costs for a Refinance The fees to refinance are usually less expensive than if you were buying a home, yet they can still be substantial and turn some borrowers away. When talking to lenders about loan options, ask what the closing costs are to complete the process and compare it with other lenders.
Some lenders will offer you a no-cost refinance. Understand that if you paid for closing costs out of pocket, the interest rate is lower. While a no-cost refinance sounds good, the downside is the lender will usually offer you a higher interest rate or put the closing costs into the new loan amount with a lower rate.
Depending on your situation, one of these options to refinance may sound like the right loan for you. Everyone has a different situation or objective. For people who bought homes in competitive markets which includes major cities of California with quick financing terms like a bridge loan, the payment should drop considerably if they want to refinance a short term loan into a conforming or jumbo loan.
Switch Your Loan Terms Refinancing your home loan provides you the amazing ability to change your loan term. Let’s say, a homeowner who initially got a 30-year fixed loan five years ago, now wants to apply for a 25-year loan term to keep the same loan balance and payoff period. Some loan programs will allow 25-year, 20 year, or 15 year mortgage terms. Some companies even let you pick your mortgage term,where it can be 23, 17 or any annual terms of 30 and below.
If you want to pay off the debt as quickly as possible many opt for the traditional 15-year fixed mortgage. A 15-year fixed mortgage payment is a lot higher than a 30-year since it is amortized over 15 years. However, if your salary or work pay has increased considerably since you bought the home, a 15-year mortgage may be more affordable than it was before. In addition, the interest paid over the life of a 15-year loan is much less than a 30-year fixed.
Who to use for my Refinance? You may have heard about using Rocket Mortgage and similar online companies who tout their speed and rates. However, some homeowners prefer more human interaction and responses during the process.
When it comes to jumbo loans and million dollar plus mortgages, some people prefer more than just 2 clicks and automated email alerts. If you’re a person with questions, concerns about what if my credit is, what if my appraisal comes back low, etc. You may prefer talking to an actual person, like a loan officer. An experienced loan officer can give you guidance and strategies if “A”, “B” or “C” happens.
It doesn’t matter if you are geographically located 2-3 hours away. With just a few phone calls, texts, emails, and e-signed documents, all your questions can be answered efficiently and still close your refinance in less than 30 days.
Moving Forward With the Loan Process
Once you are committed to refinance your home loan and chose your mortgage company to work with, you’ll begin the loan process. You will need to fill out a loan application over the phone with the loan officer, by email, or online if available. Your credit will also be pulled to confirm your credit scores through the lender’s credit provider. You will have to give the lender a signed authorization (e-signed is acceptable).
After you pass this phase of pre-qualifying, you will be asked to provide income, employment and tax return records. Additional documentation required is your latest mortgage statement, homeowners insurance policy, and a recent HOA statement if applicable. If you are applying for a bank statement loan, you’ll to provide copies of 12 or 24 months of bank statements.
Mortgage rates have dropped so much in mid-2019 that millions of homeowners may possibly benefit by refinancing — even if they purchased a home only a year ago. The average borrower(s) who refinances might save over $200 a month. Those who know it’s a good time start right away.
Since 2018, the applications to refinance are almost two-times more than the year ago period, based on data from the Mortgage Bankers Association. However, some homeowners are so busy that they have paid little attention to the low mortgage rate environment and are missing out on account of not having the time to start the process.
Are you going to be among the many potential borrowers who will wait to refinance your home and do it in the near future? Are you waiting for rates to drop further?
The general guideline to check into refinancing is if you can reduce your interest rate by one-full percentage point to strongly consider starting the process. Sometimes even a .75% drop with minimal costs can be worth exploring.
Since January 2019, interest rates for mortgage loans have been declining. With the political atmosphere so important and the China trade talks, it won’t get the headlines it deserves. Recently, the 30-year fixed rate came down to its lowest levels dating back to September 2017.
To find out how much you could save:
• Calculate your potential savings using our refinance calculator.
If the new payment and rate looks appealing, you’ll want to determine your break-even period: this is known as the time required for the monthly savings to go above the loan fees.
For example, if you pay $7,500 in fees to save $250 a month, it will take 30 months to break even ($7,500 divided by $250 comes out to 30). If you believe you’ll stay in the house beyond the break-even period, it is worth refinancing your property.
Bonus Refinance Tip:
Generally, you can refinance whenever you think it’s a good time. Although some lenders will require “seasoning” of six months to one year for the new appraisal value. For example, most lenders will not allow you to use a higher appraised value if you bought the home just four months earlier. There’s a few loan programs that will allow it but the rates are not slightly above the best refinance rates.So, it may be smart to wait out the required time.
Carlsbad is one of the most desirable neighborhoods in San Diego’s North County. The city offers the combination of the sense of a small community environment and is about a half-hour drive to downtown San Diego.
Residents of Carlsbad have a lot of benefits: they get to reside in a California beach resort area, a pleasant climate with popular attractions, and also have some of the most highly rated schools in North San Diego.
Among the various things to do, there’s LegoLand, South Carlsbad State Beach, Sea Life Aquarium, the Flower Fields and the Village to name a few. This coastal city is great for those who work in biotech, drug and tech industry with companies such as Invitrogen, Isis Pharmaceuticals, ViaSatin. If your job is in San Diego the commute would be to use I-5, 805, or I-15 south.
While the city nicknamed “Village by the Sea”, has a lot to offer, how does it compare to other areas in North County in terms of home price trends?
Have Carlsbad neighborhoods shown substantial gains in the past few years? These are important questions which potential home buyers in North San Diego should think about. This also applies to homeowners who are not thinking of selling their home in the near future. Let’s review a few popular neighborhoods within Carlsbad.
Home Price Trends in Aviara
Located in the South Carlsbad’s hills, Aviara residents enjoy views of the Pacific Ocean, community Golf course and the Batiquitos Lagoon. The city is situated north of Encinitas and west of La Costa.
Aviara neighborhood sign
This is the only area in San Diego county not impacted by the housing collapse in 2008. This neighborhood is arguably among the best choices for real estate in San Diego. As reported by Redfin, the average home price in Aviara is currently $909,000; this represents a decrease of 35.4% from the average home price in 2018.
As with most real estate, holding for a period more than a year, such as 5-10 years, typically results in positive home appreciation. Prices range from the lower $700,000’s for a condo or townhome on up to $2 million for a luxury home. Homeowners enjoy spacious living with peaceful surroundings as there is only one multi-family property (bldg. with more than one residential unit) in Aviara.
Did you know you there’s jumbo loans with as little as 10-percent down on a $2.5 million home?
In terms of list price per square footage, Aviara measures up favorably to the Greater San Diego area in general. The current median sale price per square foot in Aviara is $406, as opposed to the San Diego average of $435 per square foot. This price per square foot is very attractive given Aviara’s desirable homes, ocean and lagoon views, school ratings and ease of access to downtown San Diego.
Aviara Oaks Elementary School and Aviara Oaks Middle School with a rating of 10 and 9 respectively serve this neighborhood.
Aviara’s communities include: Aldea, Aviara Point, Avocet, Azure Cove, Bella Lago, Brindisi, Cantata, Carina, Cristalla, Isla Mar, Marea, Mar Fiore, Pavona, Sandpiper, Serenata, Tesoro de Aviara, Tramonto, Trevira, Viaggio. 7 are gated communities. HOA is managed by Aviara Master Association.
Calavera Hills is in Northeast Carlsbad, 5-10 minutes east of I-5 and south of Highway 78 for quick access to the adjacent cities of Vista and Oceanside.
Homes near Calavera Lake
Residents get to enjoy the recreation at Calavera Lake, over six miles of trails on the “Nature Preserve”, the impressive 21-acre Calavera Hills Community Park with basketball and tennis courts, athletic fields, and top-rated Carlsbad schools.
Based on the data, home values in the Calavera Hills area appear to have dipped a bit during this 12-month period in 2018. According to Redfin, Calavera Hills home values have decreased by 29% from last year. However, the price per sq. ft is $403 which is up 6.6% from last year. What this means is more homes are selling in the mid-point range.
The median home value in Carlsbad is approx. $825,000, while the median sale price is $610,000 in Calavera Hills according to Redfin. Hope Elementary School with a rating of 9 serves this wonderful neighborhood.
Prices range from $400,000 up to $1.5 million. Residence options condos, townhomes detached homes to luxury estates.
Calavera communities within include: Barrington, Capistrano, Montara, Mystic Point, Nantucket, Ravinia, Sheffield, Summerhouse, The Cape, Edinburgh Estates, The Crest, The Knolls, The Villas, The Cliffs, The Colony, The Trails.
Price Trends in La Costa 92009
Located on scenic rolling hills, many La Costa residents have views of the mountains and oceans. La Costa boasts five-star amenities from the distinguished La Costa Resort and Spa and the Park Hyatt Aviara Resort. The neighborhood is very safe and it boasts top ranked schools.
La Costa Ridge Homes
According to Redfin, the average sales price for real estate in La Costa over the course of the May 2019 is $852,000. This represents a 14% drop from the average sales price of 1 year ago. Furthermore, Redfin also posts an average sales price per square foot in La Costa of $392.
The neighborhood of La Costa currently has a wide range of real estate on the market. Home choices range from 1 bedroom condos from $350,000 to large luxury homes asking $3.5 million or more.
Popular neighborhoods include: La Costa Oaks, La Costa Valley, Arroyo Vista, Summerwalk, Saddle Ridge, The Ranch, Sonata, La Cresta, Santa Fe Trails, La Costa Knolls, Villagio, La Costa Greens, Tiburon, and Parkside at La Costa.
Related Article: How to Choose the Right Neighborhood in San Diego When Buying a House
Summing It All Up To summarize, median home values in Carlsbad are priced competitively when comparing to all of San Diego, and especially the coast areas. Median home values have increased in Carlsbad since last year and are expected to stabilize over the next year. If you’re in the market to buy a home, these Carlsbad neighborhoods and nearby are good decisions. Contact your Mortgage Expert to learn more about low down payments and no tax return options or Get Pre-Approved.
Southwest L.A. is an ideal place to live because it’s located near Culver City, LAX, downtown, USC, and has access to the 10, 110, 405, and 105 freeways. The southland’s beaches, Venice and Santa Monica are only a 10-15-minute drive from your home or thirty minutes if you’re in rush-hour traffic.
Park entrance on La Brea
Residents of Baldwin Hills can enjoy the vibe and energy of Leimert Park Village during a music or arts festival, and the natural beauty of Kenneth Hahn State Park, which is among the most enchanting places in Los Angeles. The Park is popular because it features a 360-degree view of the city.
As
of Dec. 15th, 2018, Realtor.com data indicates homes for sale in
Baldwin Hills, CA have a median listing price of $980,000 and a price per
square foot of $480. According to Redfin, as of Dec 15th, the average sales
price in Baldwin Hills is $777,000 over the last 30 days.
Neighborhoods within Baldwin Hills include:
Baldwin Hills Estates is known to most locals as “The Dons”,
(translated as “sir” in English) because 29 of the 30 streets within
the neighborhood starts with the formal title of L.A.’s original land holders. You’ll find street names such as “Don
Luis, Don Felipe, Don Diablo, Don Jose,
Don Lorenzo, Don Miguel, Don Milagro,
Don Zarembo, and Don Ricardo. The one
street without “Don” is Hillcrest Drive.
Homes with view of downtown L.A.
The neighborhood is situated north of Stocker Street, east of La Brea, southwest of Santo Tomas Drive, and south of the Jim Gilliam Recreation Center. Due to the neighborhood’s home prices and affluent black population it’s also called “the Black Beverly Hills“. Baldwin Hills is distinguished by its many hillside homes boasting swimming pools, with a good number featuring views of the famous Hollywood Sign and/or downtown L.A.
The neighborhood of Baldwin Vista is located south of Coliseum Street, west of La Brea and La Cienega (two major streets that run north all the way to Hollywood) and north of Kenneth Hahn State Park. This area has slightly smaller homes and a more secluded feel. Similar to Baldwin Hills, some homes in Baldwin Vista situated south of Sanchez Drive in the hills on streets such as Punta Alta, El Mirador, Cloverdale, and Veronica Street also enjoy views of downtown, Hollywood or Culver City just a couple miles away.
Veronica Street in Baldwin Vista
Home styles range from modern to Mid-century modern style. Most homes are single-story with some modernized adding a second floor. Home sizes range from 1100 sq.ft- 5,500 sq.ft and home prices begin in the mid $700,000 range and can command as much as $4,000,000 based on more square footage, location and views.
The
areas connection to Hollywood, mainly from African-American film and music
stars, extends back generations. Ice
Cube and film director John Singleton owned homes in Baldwin Hills. Ray Charles and Tina Turner were former
homeowners in View Park. Debbie Allen
resides in View Park and owns a dance academy in Baldwin Hills.
View Park features an outstanding collection of homes built in Spanish Colonial and Mid-Century Modern styles. This neighborhood also offers homes with great views. The neighborhood is bordered by Crenshaw Blvd to the east, La Brea and Ladera Heights to its West, Stocker and Baldwin Hills to its North, and Overhill/Northridge and Windsor Hills to the Southwest.
Home sizes range from 1800 to as much as 5000square feet. The price range in View Park varies from $700,000 to as much as $2 million for homes on Olympiad or Mount Vernon Drive.
In August 2018, the Los Angeles City Council unanimously voted 15-0 to rename Rodeo Road to Obama Boulevard. In 2007, Presidential candidate Obama held a rally at Rancho Cienega Park, between Rodeo Road and Exposition Boulevard. The change will affect a 3 1/2 mile stretch from Jefferson Blvd to Grammercy Place as you head towards USC.
Even with all the benefits, history, new interests, and beauty of living here. A problem was created. The issue now is that many people who grew up in Southwest L.A. and want to buy a home here, feel they can’t afford it. Due to home values and competition some people don’t waste their time when it comes to buying a home in Southwest L.A.
That is the feeling many prospective home buyers looking in West L.A. had where you get less sq. footage for your money. As a result, some of those same buyers found better deals in Southwest L.A. and prices have risen accordingly.
Numerous potential homeowners still believe you need a 700 credit score and a 20-percent down payment. The truth is you don’t. There’s 5-percent down loans for homes of $764,000 and less with a 640 or higher credit score. With a 600 credit score, just 3.5 percent down on a home. If you’re looking to buy a $2 million home and have a 720 middle credit score you can still get in with a 5-percent down payment subject to additional underwriting conditions.
When
buying in a desirable neighborhood in L.A., you have to put yourself into a
winning mindset, with an experienced loan officer, and a good real estate agent
who will help you reach your goal. You just have to be patient, persistent, and
prepared. Let’s talk about how I can help you.
Mortgage brokers are licensed and regulated financial professionals by the NMLS 1. They request documents from you so they can run your credit report, verify your employment and income, and analyze your debt to income ratios. They use the information to place you into a loan you’ll qualify for with one or more lenders in a short stretch of time.
Mortgage brokers hire licensed mortgage originators (aka loan officers) to work for their company typically paid as a 1099 independent contractor. Some are newbies while other are seasoned professionals.
Banks don’t offer loans for free but do tend to cost less than a mortgage broker. However, a mortgage broker could be well worth the fee they charge which is generally one to two percent of the loan amount. Moreover, an experienced mortgage broker may have business partners that may help you save on other third party fees, such as an appraisal, home inspection, and homeowners insurance.
A mortgage broker can help you save time by
submitting your file to multiple lenders.
An experienced and good mortgage originator knows the pros and cons of
some of their lenders.
They are engaged in a lot of communication with the assigned underwriter for the loan to make sure the process is running smoothly. A mortgage broker and/or their loan processor can save you a lot of inconveniences that a bank may put you through by doing a bulk of the communication with the underwriter, title company, closing agent and insurance agent.
Always review their fees if you’re still deciding on
a lender (broker, bank, online or traditional). On your “Loan
Estimate” form look in section A: “Origination Charges.” Review each Loan Estimate you obtain from
each lender, and do a comparison side by side.
Sometimes borrowers are lured to choose one lender
who’s offering a 4.00% interest rate over another lender offering a 4.25% rate,
but the lender with the lower interest rate may also have much higher closing
costs. Double check that the interest rates and loan program are the same and
then check the fees and closing costs. The competitive price comparison among
different options and lenders is a great way to make a choice in what is
probably going to be one of the largest purchases in your life.
Not everyone should go apply for a mortgage by themselves or without a good loan originator. It’s not as easy as shopping for an airline ticket or buying new furniture. Usually a mortgage broker has many years or even decades of experience to guide you through the process while a bank loan officer tends to have much less.
When choosing to work with a broker, you tend to have a more personalized loan experience, where they can identify solutions to challenges the bank may have, such as a five or ten percent down payment on a $1.5M home, low credit scores, mortgage without tax 1040s, or a loan product that will avoid mortgage insurance.
Meanwhile, an institution like Wells Fargo or Bank of America may only offer Fannie Mae and Freddie Mac conventional mortgage loans. Getting loan with a bank is kind of like the difference of having access to only local TV channels vs. having access to hundreds of satellite channels. That’s not always a bad thing if it meets your needs.
Since it’s more personalized, you might find
yourself more involved in the mortgage process as opposed to getting a loan at
one of the big banks. Because it can be more involved, it doesn’t mean you have
to speak to a person or see them in person.
There’s numerous mortgage companies and online
mortgage loan originators that do an excellent job at successfully closing your
loan all while working remotely, through email or even text messaging.
Documents and loan disclosures are signed electronically on your smartphone or
laptops.
Credit
Score advantage
A big bank might just tell you that your credit score is too low for their few
loan programs, whereas a mortgage broker will likely have a loan program to
solve the issue. In addition, they can
elaborate about how credit scoring works, review your credit and make
suggestions to pay down or payoff specific accounts to increase your score in
the future. A big bank most likely won’t make any extra effort for you while the
mortgage broker has a much better chance to find solutions if/when any
challenges come up.
Advantages of using a Bank Licensed in most, if not all 50 states. Save money on fees that a broker would charge
Disadvantages of using a Bank – Less flexible requirements – Less mortgage options to qualify for – May not get the lowest rates – May not be able to approve you without a 620 credit score – Loan officers are sometimes inexperienced – Limited availability after banking hours – Appraisal is likely not transferable to mortgage broker
Advantages of working with a Mortgage Broker – Wholesale interest rates can be lower than retail bank interest rates – More loan options due to working with numerous banks and wholesale lenders – Ability to get tough loans done due to their expanded knowledge and many lending partners – Ability to close on your home faster than a traditional bank. – Easier to get a hold of by phone, email, or text and less bureaucracy – May be a correspondent lender which means they have the ability to close your loan in 10-14 business days at very competitive rate — Can change brokers or loan officers if you don’t like them and transfer the appraisal.
Disadvantages of working with a mortgage broker: – May end up paying more money – Promises the moon to get your loan in process, usually by newbies — Has less control over your loan file because it’s not underwritten in-house – May be working with a newbie loan originator (in some cases) during the home loan process
Not everyone’s experience will be the same… • Banks and brokers can differ considerably in both service and in fees • With a broker you get one person who may be highly regarded • With a bank, there’s numerous employees which means your experience may depend largely on the employee you get.
Here’s the difference from a loan officer who worked at a bank for 15 years.
1. Brokers are better educated and more experienced. Most brokers have worked in the business longer and have left the bank because they prefer to have more control and don’t need the bank to generate leads for them. You are taking a big gamble with a Bank, most are just order takers. Even the good ones have far less control over their loan process.
2. Brokers have greater pool of lending resources. They can work with multiple investors to find the best product and price for your loan scenario. Most brokers have less overhead, fewer bureaucratic layers, lower fees and higher payouts at the same pricing point.
3. Brokers truly do care about the customer’s experience. Banks just pretend to. This makes a huge difference. Banks try and fit every customer into a box, or a process and every loan is just a numbers game. Sometimes their loans go smooth, but when problems arise, Banks are pretty slow to react. At a Bank, if one or more clients gets upset, eventually another manager comes into the branch to replace him or her. At a mortgage broker company, their reputation and referral source is at risk so providing outstanding customer service is crucial.
However, your experience can truly vary based on the location, the person you’re working with, and the lender. By simply reading some reviews online you’ll find complaints about the banks and mortgage companies you may be considering. It is similar to working with a real estate agent home inspector, closing agent and so on. Some companies are truly great while others are horrible and should never have been licensed.
A true game changer is when you are working with a mortgage company that can broker loans and also act as a direct lender where they underwrite and fund the loan in their company name. They are known as a correspondent lender. The comparison of who’s better ends there since they can do both, and then it’s just pudding on the cake when the loan officer is a true professional.
You need to feel confident about the person you’re working with. Shop around a little bit and ask for references. Speaking of references, a real estate agent usually refers their client to their preferred lender; a bank, mortgage broker and sometimes both.
Looking to buy a home in the Coachella Valley cities of Palm Springs or Palm Desert? Well, look no further as we provide you some details on some of the most appealing neighborhoods in this area.
Lantana
Lantana is a neighborhood that is suitable for every age group due to its central location. Families can send their kids to one of the nearby schools; Abraham Lincoln Elementary, Mitchell Paige, Sacred Heart School, Morning Stars Learning Program, and Palm Desert High School.
Lantana in Palm Desert
This gated enclave of 64 residences features large lots with single family homes built from 2000-2003. Many homes have their own swimming pools. There’s a private dog park exclusively for Lantana residents.
The HOA fees are low, yet you’re still close to everything that Palm Desert has to offer. The inventory of homes on the market is seldom in Lantana, and when they are for sale, prices start in the high $400,000s.
Chino Canyon
Aerial Tramway
Chino Canyon is a unique tranquil neighborhood located near the Aerial Tramway. These homes are offered on large lots loaded with large prominent incredible boulders. They actually coordinate well with the landscape along with the views of the valley.
Property types range from condos,
town homes to single family homes and prices begin at $250,000 up to $1.7
million.
Katherine Finchy Elementary School
serves grades K-5.
The neighborhood is bordered in the north west by Tram Way and N. Palm Canyon Way to the east, and Vista Chino Rd. to the South.
Vista Las Palmas
Street in Vista Las Palmas
Vista Las Palmas is situated west of Old Las Palmas and east of Los Robles Drive. There are many large homes in this neighborhood bounded by W. Vista Chino in the north, Stevens Road in the south, N. Rose Ave westerly, and W. Via Monte Vista east. located here.
The neighborhood of nearly 400 homes are made mostly of mid-century modern homes. The area was developed by the Alexander Company, mostly in the late 50s and early 60s. Some homes have been upgraded to contemporary style yet the mid-century architecture is very evident.
Additionally, there’ a sprinkling of Swiss Miss-style residences with steep gables. Homes are priced from $700,000 – $3,000,000 with the median home price at $1.5 million If you want a great location and value, then look into Vista Las Palmas.
Old Las Palmas
This neighborhood of large gated estates is considered among the most glamorous residential areas in the Coachella Valley. The nearly 300 luxury homes in this community are deemed historic and architecturally significant. This keeps it in high demand by some of the most discerning real estate investors.
A couple of reasons are because the homes were designed by some of the best architects and it’s a neighborhood boasting the largest number of properties owned by celebrities such as Dean Martin, Marilyn Monroe, and Dinah Shore.
The style of homes varies from mid-century modern, ranch, to Spanish Colonial. It is not uncommon for these large estate homes to have an Olympic-sized pool with lush landscaping.
Many of Palm Springs‛ largest and oldest estates can be found in this neighborhood located between downtown and the mountains. To be more specific, it’s south of Stevens Road, west of North Palm Canyon Drive, north of Alejo Road and east of Via Monte Vista.
If you are looking for a grand estate, there is no better place to look than Old Las Palmas. Homes are priced from $400,000 – $6,000,000 The community has no HOA.
Movie Colony
The Movie Colony neighborhood received it label due to all the stars and movie executives that own and did own property here. With its enormous sized estates and prestigious residences, a lot of these homes have been preserved with their original construction from the 1920s, 30s and 40s.
Home in Movie Colony Photo courtesy of Coachella Valley Assn of Realtors
Homes are located on mature tree-lined streets with styles that are either mid-century modern and stucco ranch homes. More than 500 stars and celebrities
have identified Palm Springs as their desert retreat.
Notable celebrities include Cary Grant, Frank Sinatra, and Jack Benny. There are No HOA’s Homes are priced from $600,000 – $4,000,000.
Tennis Club
The oldest neighborhood in the city known as the Historic Tennis Club is bounded by Tahquitz Road to the north, Belardo to the east, Sunny Dunes in the south, and the mountains in the west. The area called Tahquitz Canyons Estate is also included.
Tennis Club Home
The neighborhood has just under 250 single family homes, townhomes, and 25 hotel condo units. The style of architecture is either Spanish or Contemporary homes.
This area is highly desirable because it is within walking distance to Palm Spring’s finest attractions providing quick access to restaurants, nightclubs, cocktail lounges, cafes, boutiques, and art galleries.
Homes are priced from $900,000 – $5,000,000. The median sales price is $776,000 as of October 2018. A neighborhood with this name has to have tennis and it won’t let you down as it features 11 tennis courts.
Deepwell Estates
For residents located in this attractive, virtually wind-free area, you are close to upscale eateries and boutique shop retailers.
This neighborhood features more than
360 homes boasting mid-century modern and California ranch style architecture.
Some of Deepwell Estates’ famous residents include Loretta Young, Jerry Lewis, Eva Gabor, Liberace, and William Holden.
Homes are typically on generous sized lots with some having scenic views of Mt. San Jacinto. They were built from the 1950’s through 2013. Many have
since undergone extensive remodels.
Recent Deepwell Home Values: $500,000’s to $1.3 million. However, homes are typically priced from $600,000 – $1,500,000. There is no HOA.
Deepwell Neighborhood has these boundaries: East: Sunrise Way West: South Palm Canyon Drive including the detached Biltmore homes North: Mesquite Ave South: East Palm Canyon Drive
The Mesa
The Mesa neighborhood is located west of S. Palm Canyon Drive in the lower hilly section of the San Jacinto Mountains. Homes in the Mesa offer a variety of contemporary and innovative architectural styles such as Spanish Colonial villas, Adobe, mid-century modern as well as Santa Fe style homes.
Backyard with pool in the Mesa. courtesy of Coachella Valley Assn of realtors
In the 1920’s, Edmond Fulford’s idea was to build a unique community in a secluded area that was protected from the desert winds. His concept was realized in this neighborhood.
The Mesa has no HOA fees and home prices are between $500,000 up to $4,000,000. The average home price per Redfin is $1,495,000. As with any neighborhood, home values are subject to change.
No matter what home style or price point you end up selecting, it is a smart idea to begin the loan pre-approval process to see your financing options.
Map of the Mesa
Some of the street names you’ll find within this gem of an enclave with approximately 200 homes are Camino Descanso, Camino Buena Vista, Avenida Moraga, Crestview Drive, W. El Portal and Ridge Road.
The neighborhood also offers convenient access to downtown Palm Springs in ten minutes or less by taking Palm Canyon Drive (see the map).
Cahuilla Hills
The Cahuilla Hills neighborhood has a similar serene location as Bighorn Country Club across the street but minus the whopping sales price. This community on Cholla Way or Jaguar Way offers residents a wide selection of homes and lot sizes, which range from approximately one- to- five acres.
The architectural styles in the community vary from traditional 1970s to modern contemporary. Cahuilla Hills homes situated near the Bighorn Golf Club feature some of the most amazing views in the neighborhood. The community is unincorporated, with no HOA fees here and homes prices range from $500,000 up to $3.5 million.
Indian Canyons
Palm Springs‛ most distinguished golf course location is the south end canyon section. Homeowners in this very impressive community are offered access to the Indian Canyons Golf Resort designed by Donald Wexler and Rick Harrison. The club provides two 18-hole golf courses, a golf shop, and a driving range to improve your swing.
Homes styles range from the 1950s to
the 1970s and typically sell from $600,000 up to $2,000,000.
Some homes are on leased land which may still qualify for financing depending on the details.
Araby
Although some of the properties in this neighborhood were first completed in the 1930’s and 1940’s, the majority of homes in this small community have been reconstructed with contemporary and Spanish architecture.
The lot sizes are large so a good number of Araby residents used that added space and have in-ground pools.
The neighborhood of Araby Cove is
located east of Farrell Drive and off Araby Road. Streets within the community include Barona
Rd, Concha Trail and Anza Trail.
Real estate prices range from one-half million up to $1.5 million. There aren’t any HOA dues.
Southridge
The exclusive 24-hour guard gated community located south of Highway 111 on Southridge Drive is called Southridge. Homes in Southridge are among the most expensive in Palm Springs.
Contemporary home in Southridge
The 19 luxury estates showcase the absolute finest in construction quality, modern design and life’s amenities atop a hill of Mt. San Jacinto. On spacious acre-sized lots, you’ll notice the custom stone craft, expert landscaping, and exquisite architecture.
Homeowners enjoy panoramic views of
Mount San Jacinto, Mount San Gorgonio, and the Coachella the valley below as
well as surrounding mountain ranges.
There is an HOA called the
Southridge Property Owners Association with fees of $574
monthly and up.
These luxury home enclaves price ranges from $1 million to more than $10 million. Historical homes include the Lautner house shown in the James Bond movie “Diamonds Are Forever”, Bob Hope’s home, the William Holden house, and Steve McQueen’s house.
Bighorn Golf Club
Within the luxury section, situated in the southwest corner of Palm Springs foothills of the Santa Rosa Mountains is the community of Bighorn Golf Club. This secluded neighborhood has some of Palm Desert’s most expensive real estate with individual luxury custom-built homes starting at $1.5 million to more than $10 million.
These unique customized luxury homes in Bighorn Mountains and Bighorn
Canyons are offered as a home or spacious villas in the ultra-luxury resort
community
Amenities include two world-class, 18-hole golf course designed by Tom
Fazio, a recently built 80,000-square-foot clubhouse costing $70 million (not a
typo) with a fitness facility, tennis, salon, spa, five-star cuisine, social
events and more. The conclusion is no luxuries were spared.
https://www.golfdigest.com/story/is-this-new-dollar70-million-clubhouse-at-bighorn-golf-club-the-most-extravagant-clubhouse-in-golf Among the streets are Chalaka Place, Crescent Falls, Pinnacle Crest, Metate Place, Tamit Place in the community. Club membership: $100,000. Golf membership runs $350,000, annual dues from $16,000 to $31,000, membership limited to homeowners; Recent HOA is approx. $775/
Parc Andreas
Photo courtesy of Coachella Desert Association of Realtors
This small gated community in South Palm Springs features over 140 homes. The majority of homes in Parc Andreas are custom-built homes, constructed in the late 1980’s. Living area square footage ranges between roughly 2,500 to 4,500 sq.ft. with lot sizes between 11,500 to 22,000 sq.ft.
Similar to other high-end Palm Spring neighborhoods,
the Parc Andreas community was built to reap the benefits of the peaceful
Indian Canyons location and mountain views from all directions.
Homes are currently selling between $500,000 to as much as $2.5 million. HOA: approx. $110/mo and up. FYI – Residences are located on leased land with recent annual lease payments of $4,254.
Andreas Hills
This prestigious neighborhood features distinct
views of San Jacinto Mountain range and the scenic desert hills backdrop.
Andreas Hills real estate ranges from luxury condos to high-end single-family
homes. Architecture spans from Tuscan style villas, Spanish Style homes, to
modern luxury condos with vaulted ceilings and upscale designs.
Andreas Hills & Palm Canyon Drive
The streets of Andreas Hills such as Avenida
Sevilla, Dogwood Circle, Maracaibo Circle, Snapdragon Circle, Bogert Trail, are
mildly curving roads and peaceful cul-de-sacs. Each home’s private driveway is
lined by palm trees and is enclosed by a lush green lawn with fully-grown
desert bushes giving neighbors added privacy.
Homes
are priced between $1,000,000 – $3,000,000 without any HOA dues.
Additional neighborhoods with expensive real estate nearby Palm Springs and certainly well worth mentioning are the cities of Indian Wells and Rancho Mirage.
Found a home you like? Get pre-approved. if you’ve already started the process, get a second opinion and quote/estimate on rates & fees.
Ever since the Qualified
Mortgage (QM) rule began in January 2014, borrowers have had a difficult
experience obtaining a mortgage if they didn’t have the normal source of income
documentation.
Self-employed borrowers
in California and across the country may soon have a less challenging time
qualifying for mortgage loans. A bi-partisan Senate bill proposed in August
2018 is intended to help self-employed and “gig economy” workers with
improved guidelines to qualify easier for a mortgage.
Contract job workers
Basically, it would allow
banks and mortgage lenders to use alternate
documentation instead of just W-2 forms, when it comes to income
verification. The ability to repay (ATR)
the loan is still present.
Greater Access to Home Loans for “Gig
Economy” and 1099 Independent Contractors
Silicon Beach is helping
fuel the growing Los Angeles GIG economy. The same can be said of Irvine in
Orange County, and of course San Francisco leads all cities with the biggest
number in that category.
In August 2018, U.S.
Senators Mark R. Warner (D-VA) and Mike Rounds (R-SD) new piece of legislation
would possibly increase mortgage loan qualifying for the self-employed and various
creditworthy consumers with non-traditional forms of income.” The legislation,
known as the Self-Employed
Mortgage Access Act, would give lenders other methods for income
verification.
There’s many individuals
out there who have found it challenging to get approved for a mortgage simply
because they are self-employed, quasi-employees who work 9-5 but paid as a 1099
contractor, and don’t fit into the traditional model lenders use for income
verification.
They can make an extra
$20,000-$50,000 a year hustling doing gig jobs. That comes out to $1,666 per month
that can be applied to their debt to income ratios. This additional documented
income certainly helps in California’s high cost housing market.
The average down payment percentage in California was 21.44%, averaging $97,809. However, in Los Angeles and Orange County, median home prices1 are approximately $670,000 which translates to a $120,000 down payment. Fortunately, we have loan programs that require 5 or 10-percent down if the borrower qualifies.
The Self-Employed
Mortgage Access Act would enable self-employed people in California and
nationwide to provide alternate forms of documentation to verify their income.
If the bill successfully
gets through, the following documents would be acceptable for mortgage
underwriting:
IRS Form 1040 Schedule C for sole proprietorships,
people paid 1099 with business expenses,
IRS Form 1040 Schedule F for farm workers
IRS Form 1065 Schedule K-1 for partnerships
IRS Form 1120-S for S Corporations
This latest development
is part of the ongoing evolution of the mortgage industry. In the last several
years, one type of alternative documentation mortgage product that has gained
popularity is the “bank statement loan”. This program allows the borrower to
avoid tax returns altogether and prove their income through their deposits on
their bank statements (we have this loan).
Gig workers
The recently introduced bill has gained support from many individuals and
different groups, which includes housing and economic research organizations to
mortgage industry groups such as the Mortgage Bankers Association, Consumer
Federation of America, and the Milken Institute.
Similar to any
legislation to become law, this proposed bill would have to pass the Senate,
the House, and finally the President would have to approve and sign.
Have questions? Are you a
self-employed worker in California?
The city of Murrieta, CA is considered a safe place for families with very good schools and top-notch law enforcement. It is regarded as a commuter’s city for those who drive to Corona, Riverside or a one-hour drive down to North San Diego. The benefits are affordable home prices, nice parks, and quality of life are what attract people to this Southwest Riverside County city. Without further delay here are the best neighborhoods in Murrieta, CA.
Copper Canyon is a master-planned community situated at Clinton Keith and Calle De Oso Oro. There are two entrances into the community, one via Clinton Keith, and the other from Washington Street.
Copper Canyon
1.) The community of Copper Canyon has a large 8 ½ acre park which includes athletic fields, bike paths, walking, sitting areas, and a concession stand.
Copper Canyon homes surround Cole Canyon Elementary School which is is probably the top-performing elementary school in the district. Low taxes and few homes in HOAs (there are some, but they are mostly low).
Residents
with school age children can attend one of the best-rated schools in Thompson
Middle School and Murrieta Valley High School which are ranked 9 on a scale of
10.
Homes range in price from $450,000 to more than $2.4 million for a 7,000 square foot plus estate-sized home. Monthly payments with a 10-20-percent down payment range from $2,080 to $10,730.
Honorable Mention: Countryside/Creekside homes are located west of Washington and south of Vineyard. Residents with school-aged children attend Murrieta Elementary (our kids did), and the education is very solid. There’s no HOA fees, low taxes, but price levels vary throughout over 500 homes.
2.) La Cresta – This exclusive community is located in the
Murrieta Foothills. The neighborhood features custom built homes, avocado
ranches and vineyards. Homes
range in size from approximately 2,500 square feet to more than 10,000 sq.
feet.
La Cresta Community Sign
Home prices usually start at $500,000 and reach $3.5 million. The big range is due to the size of the home and lot size with some boasting 5 acres or more. With lots this large, you’ll find many equestrian estates ideal for the area with dedicated horse trails.
Some of street names include Avenida La Cresta, Calle Bandido, Calle Juanito, Via Caballos, Avenida Bosque, Avenida Escala, Vista De Montanas, Via Vista Grande. HOA: La Cresta Property Owners Association (951) 699-2918
3.) Murrieta Ranchos – Located West and East of Washington at Santa Fe, is the Murrieta Ranchos homes development. These homes sit on oversized lots, are larger single story “ranch-style” homes mostly with detached garages and views of the Santa Rosa Plateau. These single-story homes range from 3 to 6 bedrooms and 2 to 3 bathrooms. The community is usually in high demand due to its close proximity to Murrieta Valley High School and Thompson Middle School.
The median sales price is $905,000 as of Feb. 2023 according to Neighborhood.com. In 2019 the median was $635,000 so residents have obtained great appreciation. HOA: $0. This community has no HOA fees.
Approximate monthly payments with 10-percent down range from $2, 817 to $2,504 for a 20-percent down payment. See assumptions below.
4.) Greer Ranch — this is a guard gated community north of Clinton Keith Rd, between the 215 and 15 freeways nestled in the Murrieta hills. Many of the 693 homes have amazing views, and are designed with a Mediterranean and Spanish influence. The neighborhood enjoys excellent top rated schools, parks, bike trails, and recreational facilities along with the amenities of an HOA with a community pool, clubhouse, etc.
A
historical fun fact is in the 1960’s Everett Greer discovered this section of
land in Murrieta.
The community HOA is $225 per month. The median home sales price is $805,000 as of January 2023 according to data from Sotheby’s Realty.
Approximate
monthly payments with 10-percent down range from $1, 971 to $1,743 for a
20-perent down payment with a 4.25% interest rate and excellent income and
credit.
5.) Golden Triangle — a location with multiple neighborhoods between and around California Oaks Sports Park are a bit older home with solid values, solid Murrieta schools, lower price point than Copper Canyon or Greer Ranch.
6.) Olive Hill Ranch – is a community located in the western foothills. Homes in this lovely private gated community are situated snugly in the hillside. Naturally, marvelous views of the Murrieta Valley and upscale living are what homeowners in this community enjoy. Semi-custom Olive Hill Ranch homes offer spacious living on approximately one acre lots.
Olive Hill Ranch
Olive
Hill Ranch features 44 single-family homes with a large portion of them having
a contemporary style. Homes were built between 2000 and 2001, contain an
average of 3,200 square feet with four bedrooms and three baths.
Because of the low number of homes, there
haven’t been many recent sales. Typically, the homes will sell from $600,000
and up.
Neighborhood street names include Joshua Tree Ct.,
Truman Pl, Tyler Place, Jersey Pine Court.
Olive Hill Ranch Homeowners
Association
41870 Kalmia St
Murrieta, CA 92562
7.) Vineyard Knolls homes are a lovely housing development located in the northwest part of Murrieta. It is directly across the street from the exclusive Bear Creek Golf Community, just 2 miles from I-15.
The homes in this development were completed in 1989. There are four floor plans that range in size from 1553 square feet up to 2218 square feet. Recreational facilities for this development include a park, pool, and spa area. Murrieta has excellent schools, and the elementary school for this neighborhood –
Cole Canyon Elementary – is among the few pubic elementary schools in California to receive a distinguished GREAT SCHOOLS with a 9 rating. Other great schools for children of this tract is Thompson Middle School and Murrieta Valley High School
8.) Bear Creek This prestigious gated community includes both single-family homes and attached homes that feature either a Contemporary or Mediterranean style. Homes were built from 1984 through 2016. These homes offer 2- to- 6 bedrooms and up to 7 bathrooms. The living space of the homes ranges from 1350 up to 11,668 square feet. The community amenities include a Jack Nicklaus golf course, har-tru clay tennis courts, clubhouse, pool and kid’s area.
Entrance to Bear Creek
Home prices in Bear Creek currently range from $340,000 for an attached townhome to $2.5 million for a luxury home. The average sales price is $1,090,000 as of Feb. 2023. There is an HOA and the amount depends on the size of your home. The range is from $168 to $445/month With wide ranges in homes prices, potential mortgage payments will also vary: As low as $1,661/month for a home sold at $340,000 to as much as $11,663/month for a $2.5 million home with 10-percent down.
Streets
within are Lynx Ct, Serenade Ct, Eagles Nest Court, Bear Creek Drive, Bear
Canyon, Streamside Court, Quail Ridge Drive, Arbordale Ct, Via Vista Grande,
9.) Spencer’s Crossing – This 600-acre community offers homeowners a wonderful blend of rural charm with contemporary neighborhoods. Builders have created beautiful home designs perfect for you and your family. With resort-style amenities, living in this community offers miles of walking trails, top schools and only a 10-minute drive to Temecula.
Spencer’s Crossing
Community
offer one- and -two-story floor plans by Brookfield and Richmond American
feature home sizes ranging from 2112 to 4021 sq. ft. with 3 to 7 bedrooms.
Homes
range in price from $445,000 and up.
Mortgage
payments with 10-20-percent down range from $1,973 to $2,076 per month based on
720 credit scores and an interest rate of 4.375%
10.) Alta Murrieta – Located along Alta Murrieta Road and Murrieta Hot Springs, Alta Murrieta is community close to schools, shopping, dining, and easy access to both the I-215 and I-15 freeways. Home prices range from $360,000 and up
Loan
assumptions – borrower has a 720 or higher
credit score and interest rate of 4.75%. Your actual interest rate may be lower
or higher depending on your overall credit, qualifying income, and loan program.
