• Review Your Goals: Align your loan with your long-term plans, from tax benefits to future renovations.
• Make Offers Shine: Personalized pre-approval documents and direct communication between your lender and listing agents will set you apart.
• Ensure The Best Rate: Track the market with a mortgage broker with access to 50+ lenders.
• Talk To Steven: Receive guidance and get your questions answered every step of the way.

• Pay money now (points) to get a lower monthly payment later.
• Only worth it if you keep the loan for 4+ years (to recoup the cost).
• Tax bonus: deduct all points in purchase year (consult tax pro).

Example: $7,000 in points saves $144/month, recouped after 2.6 years.

Fixed Loans:

• 30, 20, 15, 10 year: Stable predictable rates, ideal for long-term plans.
• Higher rates than some adjustable options.

Hybrid Loans:

• 3, 5, 7, 10 year fixed then adjustable: Lower initial rates than fixed, good for short-term plans.
• Uncertainty in future rates after fixed period.

Adjustable Rate Loans (Rarely offered):

• 1, 3, 6, 12 month adjustments: Lowest initial rates, highest risk of future rate increases.
• Best for short-term financing with significant cash flow needs.

Additional Notes:

• • 15 year fixed offers faster payoff but higher payments.
  • Hybrids lock in lower rates for longer periods than ARMs.
  • ARMs offer potential for low initial rates but future uncertainty.
  • Lender PMI, 80/10/10, and VA loans can eliminate mortgage insurance.

Pre-Qualification:

• Quick & easy: Estimate loan amount with a loan agent.
• Based on self-reported info: Income, debt, assets, credit (less thorough).
• No docs needed: Not a formal commitment from the lender.

Pre-Approval:

• The real deal: Verifies income, debt, assets, credit with documents.
• Stronger position: Gives you a “walking credit card” for house hunting.
• Valid for 90 days: Usually lasts while your financial situation is stable.

Remember:

• Always get pre-approved before searching for a home.
• Pre-approval letter shows serious interest to sellers.
• Start with pre-qualification, then move to pre-approval for real buying power.

Fixed Rate:

• Interest rate stays the same throughout the loan.
• Stable payments despite market fluctuations.
• Higher initial rate compared to some adjustable options.

Adjustable Rate Mortgages (ARMs):

• Interest rate can change periodically based on an index.
• Lower initial rates, potentially qualifying for a larger loan.
• Risk of rising payments if interest rates increase.

Key ARM terms:

• Index: Market benchmark affecting rate adjustments (e.g., Treasury bills).
• Margin: Fixed percentage added to the index to determine the new rate.
• Caps: Limits on how much the rate and payments can adjust in a period or over the loan’s life.

Choosing the right loan depends on your risk tolerance and market expectations. Fixed rates offer stability, while ARMs can be cheaper initially but carry uncertainty.

Owning a home comes with several financial benefits, and tax advantages are a key perk. Here’s how owning can potentially put more money in your pocket:

Mortgage Interest Deduction:

Think of your mortgage interest as a monthly “rent deduction” from your taxes. Uncle Sam allows you to deduct up to $750,000 in mortgage interest, effectively lowering your taxable income and tax burden.

Property Tax Write-Off:

You can deduct property taxes from your federal taxes, up to $10,000 per year. This further reduces your taxable income and potential tax bill.

Building Wealth through Equity:

With every monthly mortgage payment, you’re not just paying rent, you’re building equity in your own property. This adds to your net worth and can be a significant financial asset down the line.

Benefits Beyond Taxes:

While taxes are a major advantage, owning opens doors to other financial benefits like potential rent income from future rentals, renovation upgrades that increase property value, and enjoying a stable, long-term housing situation.

Remember:

• This information is general and doesn’t replace professional tax advice.
• Specific benefits depend on your individual circumstances, like loan amount, tax bracket, and property taxes.
• Consult a tax professional for personalized calculations and strategies.

1. Define your goals & get pre-approved:

• Meet with us to discuss your financial objectives and find the perfect loan fit.
• We’ll establish a comfortable budget, review your financial budget, and guide you through closing costs.
• Get pre-approved to strengthen your offer and move quickly.

2. Find your perfect home with a realtor:

• Work with a realtor to refine your search based on your needs and desires.
• Preview properties efficiently, eliminating those that don’t match your criteria.
• Choose your dream home and craft a strong offer using your pre-approval.

3. Smooth sailing to closing:

• We’ll lock in your chosen loan rate and order an appraisal to secure your purchase.
• Once contingencies are removed, final paperwork is reviewed for your smooth sign-off.
• We fund your loan, escrow finalizes, and voila! The keys are yours!

Enjoy the peace of mind knowing you’re supported every step of the way. Leave the stress behind and focus on finding your perfect property.

Annual Percentage Rate (APR): The true cost of your loan, including interest, fees, and points.

First Adjustment: When your adjustable rate can first change.

Index: The benchmark used to adjust your rate (e.g., Treasury bills).

Interest Rate: Your starting rate (fixed or adjustable), as stated in your loan agreement.

Life Adjustment: The highest your rate can ever go.

Loan Limits: Maximum loan amounts for your area. Check out this link for specific limits in Northern and Southern California counties:

Federal Housing Finance Agency (FHFA):

• • They set conforming loan limits annually.
  • Access the latest limits (usually updated in December) here: https://www.fhfa.gov/DataTools/Tools/Pages/Conforming-Loan-Limit-Map.aspx
  • You can also download a detailed list of limits for all counties: https://www.fhfa.gov/DataTools/Downloads/Pages/Conforming-Loan-Limit.aspx

Fannie Mae:

• • Confirm the current limits directly on their website: https://singlefamily.fanniemae.com/originating-underwriting/loan-limits

Loan to Value (LTV): Ratio of your loan amount to the property’s value.

Mortgage Insurance (PMI): Required if LTV is over 80%, protects the lender if you default.

Margin: Extra percentage points added to the index to determine your new rate.

Max 1st Adjustment: Larger initial rate adjustment on some hybrid loans.

Periodic Cap: Maximum change allowed for your rate at each adjustment period.

Points: Upfront fees paid to lower your interest rate.

Term: The length of your loan (e.g., 30 years).

Remember:

• This is a simplified guide, consult a loan officer for specific details.
• Understanding these terms empowers you to make informed decisions about your mortgage.

1. Conventional Loans

• Down Payment: Minimums can be as low as 3% for qualifying first-time homebuyers.
• Credit Score: Typically requires a score of 620 or higher.
• Benefits: No upfront mortgage insurance premium and the possibility of canceling private mortgage insurance (PMI) upon reaching 20% equity.
• Drawbacks: Stricter credit score and debt-to-income ratio requirements compared to government-backed loans.

2. FHA Loans

• Down Payment: As low as 3.5% for credit scores of 580 or higher; 10% for scores between 500-579.
• Credit Score: More lenient, with some lenders accepting scores as low as 500 with higher down payments.
• Benefits: Lower down payment requirements, more lenient credit qualifications, and the ability to use gift funds for down payment and closing costs.
• Drawbacks: Mandatory mortgage insurance premiums (MIP) for the life of the loan if down payment is less than 10%; otherwise, MIP is required for 11 years.

3. VA Loans

• Down Payment: None required, can finance up to 100% of the purchase price.
• Credit Score: No minimum credit score set by the VA, but lenders typically look for a score of 620 or higher.
• Benefits: No down payment or PMI, limited closing costs, and competitive interest rates.
• Drawbacks: A VA funding fee is required unless exempted due to a service-related disability.

4. Jumbo Loans

• Down Payment: Typically at least 10-20%, depending on the lender and loan amount.
• Credit Score: Generally requires a score of 700 or higher.
• Benefits: Financing available for expensive homes that exceed conforming loan limits.
• Drawbacks: More stringent underwriting standards and potentially higher interest rates.

5. DSCR Loans (Debt Service Coverage Ratio Loans)

• Down Payment: Typically between 20-30%.
• Credit Score: Credit score requirements vary, with more emphasis on the property’s cash flow.
• Benefits: Loan approval based on the rental income of the property rather than the borrower’s personal income.
• Drawbacks: Higher interest rates and may require a larger down payment compared to other loan types.

Please note: Mortgage products and guidelines can vary by lender and may change over time. It’s always best to consult with a mortgage professional for the most current information.

Choosing how to hold title to your property is a crucial decision with legal and financial implications. Here’s a simplified breakdown of common options:

For singles and divorced individuals:

• Sole ownership: You possess exclusive ownership and control.

For married couples:

• Community property: Both spouses share equal ownership and rights, regardless of who acquires the property.
• Separate property: One spouse individually owns the property, requiring the other’s consent for certain transactions.

Joint ownership options:

• Joint tenancy: Shared ownership with right of survivorship, meaning remaining owner inherits deceased owner’s share automatically.
• Tenancy in common: Shared ownership with individual shares, without right of survivorship. Each owner’s share passes to their designated beneficiaries upon death.

Important considerations:

• Right of survivorship: How will ownership transfer upon death?
• Estate planning: Will your ownership structure align with your desired inheritance plan?
• Tax implications: Consult a tax professional for specific impacts.

Remember:

• This is a simplified overview. Seek professional guidance from an estate planner or tax advisor for comprehensive advice tailored to your unique situation.
• Consider a living trust for managing your assets, especially with a medium to large portfolio.