Jumbo Mortgage Approval Orange County CA

Orange County California JumboJumbo Mortgage Approval Orange County CA:  Orange County covers a lot of Southern California Territory covering some 948 square miles. From Fullerton to Newport Beach to San Clemente to Anaheim, Orange County is home to some 3 million residents making it the third most populous county in California and the sixth-most in the U.S. And after a slump in home prices toward the end of the last decade, property values again are on the rise and have gradually surpassed home values prior to the decline. The median home value for Orange County today is right around $650,000 which is slightly higher than the current conforming loan limit of $625,500. This means jumbo financing is an option for more home buyers in Orange County compared to other spots in the United States.

While most jumbo lenders approve loans using the same basic guidelines they may also add additional requirements in order to obtain a jumbo mortgage approval. For example, jumbo loans may require a minimum down payment of 10 percent and a minimum credit score of 700, while another jumbo loan might ask for a 25 percent down payment and a 720 score. These individual adjustments to jumbo loan programs in Orange County can vary slightly depending upon the appetite of the individual jumbo lender. Read below for 95 percent jumbo options.

Lenders determine affordability by using debt-to-income ratios. This is a percentage of housing and total monthly debt compared to gross monthly income. For example, let’s say you’re buying a home in Huntington Beach and the sales price is $975,000 and you’re making a 20 percent down payment borrowing $780,000. Using a 4.00% 30 year fixed rate, the principal and interest payment is $3723. If monthly property taxes are $500 and insurance $250 per month, the total mortgage payment is $4,473. If gross monthly income is $13,000, the housing debt ratio is $4,473 divided by $13,000 = .34, or 34. Jumbo lenders like to see this number between 33 and 38.

In addition to the mortgage payment, lenders also add up any remainder credit obligations such as an automobile loan or installment loan. Let’s say there is a car payment of $700 and an installment loan of $200. Now the total monthly debt is $5,370 and the total debt ratio is .41, or 41. This is the target debt ratio used by many jumbo lenders however some programs allow this number to exceed that providing evidence of compensating factors such as a credit score above 750 or a significant amount of cash reserves available.

Some borrowers however might choose to take advantage of low rates currently available and decide to leverage as much as possible by financing up to 95% loan to value. That’s right, jumbo financing is available to eligible home buyers up to $1,000,000 with only 5% down payment required.  Buyers can read about all the latest nationwide 95% Jumbo requirements here.  Buyers can often choose between two options:
1. Single loan 95% Jumbo with NO PMI.
2. Combo first mortgage at 80% of the sales price and the second mortgage at 15%.
A Jumbo loan specialist can run the math comparing different scenarios to discover the ideal jumbo financing option for your situation.

Please see all of the latest 2016 Jumbo loan guidelines here

If you’re employed and receive a regular pay check you’ll be asked to provide your two most recent pay check stubs and two years of W2 forms. If you’re self-employed you can expect to be asked for your two most recent federal income tax returns, a year-to-date P&L and business bank statements in addition to your personal financial information.

Most sellers today, especially so in Orange County, require that all offers include a preapproval letter from a lender. When you select your jumbo lender, ask your loan officer to provide you with a preapproval letter which tells the seller that not only have you applied for your financing but the lender has reviewed your financials as well as your credit history. Providing such a letter will give you a hands-up compared to other potential buyers without one. Once you get an accepted offer for a home in Orange County, having previously provided your personal information means your loan approval will be a smooth process.

Questions about any of the Jumbo mortgage options listed above? Contact Five Stars at www.FiveStarsMortgage.com

 

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USDA Interest Rates, Closing Times July 2016

USDA Interest Rates July 2016Mortgage interest rates for USDA loans and other home loan programs have remained low this summer.  Low as in…near historic low levels. Interest rates across the board are plummeting following Britain’s vote to leave the European Union last week. Mortgage companies began slashing their rates last week. According to the lenders surveyed, the 30-year mortgages have been the beneficiary of the most discounting.

Brexit shook the stock markets as investors ran to bonds. As the 10-year Treasury gains favor, its price rises, but the yield falls – and mortgage rates are quickly approaching record lows.

Will these low rates go down even more in July & August?  According to Fannie Mae’s most recent National Housing Survey, half of borrowers think mortgage rates will be higher one year from today, and another 47% believe rates will hold near their current range.

The survey, which covers 1,000 households, and is to monitor changing buyers attitudes toward mortgages and housing nationwide. Only 4% of those surveyed expect mortgage rates to drop.

USDA Interest Rates, Closing Times July 2016:

As of July 1st 2016 – the government loan rates are currently in the low 3% range.  This includes USDA Rural Housing, FHA and VA loans – purchase and refinance transactions.  Some important things to note:

  • These interest rates assume good credit FICO – over 720. Borrowers with FICO scores, especially those lower than 680 should expect higher rates.
  • Interest rates assume no added “points” or added fees outside normal closing costs. However, borrowers always have the options of paying added point(s) in exchange for lower rates.
  • Rates assume normal 30 year fix rate loans, 30 day lock terms.

Homeowners that currently have a USDA Rural Development loan with a higher interest rate can learn more about the cost saving USDA Streamline Assist refinance. The new program makes refinancing easy and allows for unlimited loan to value, no appraisal, home inspection or minimum credit score requirement.  *This only applies to this special refinance program, NOT the standard USDA 502 Guarantee purchase loan.

USDA Closing Turn Times July 2016:

USDA turn times can vary depending on the home purchase state. As of July 2016, most states are between 3-7 business days.  Note: this is the time is takes USDA Rural Housing to issue a loan commitments AFTER the lender has competed the initial underwriting, appraisal, etc. Buyers should expect the complete closing process to take about 30 days depending on purchase location state. If you have questions about a USDA already in process with a lender or bank, please contact them directly for latest status.

Home buyers that have questions about a new USDA loan approval, please contact us at 904-302-6060 (7 days a week) or visit www.UsdaMortgageSource.com for more information.

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Considering Jumbo Loan Washington State?

Jumbo Loan Washington StateConsidering Jumbo Loan Washington State? High end real estate in Seattle requires a bit more time when searching for the proper financing. Sure, most mortgage companies offers both conforming and jumbo loans, but there are companies that tend to specialize in jumbo financing. By doing this they have special relationships with jumbo investors and can offer more of a boutique-style options in addition to standard, jumbo fixed rate fare.

Jumbo mortgages are those that are above the local conforming loan limit. In most of Washington the conforming loan limit is $417,000 yet in certain areas deemed “high cost” due to the higher median price of homes, the conforming limit can be as high as $625,500 (parts of California, Florida, etc) That vast bulk of conforming loans are those underwritten to Fannie Mae and Freddie Mac guidelines. When lenders approve a loan using these standards the loan is eligible for sale in the secondary markets, freeing up additional cash to make still more mortgages. Jumbo loans also have a secondary market though not as robust as the conforming marketplace. In some cases, jumbo lenders keep their loans in-house with no intention to sell. In all, jumbo loans account for around 20% of the overall number of mortgages approved each year.

All this means is there are choices for jumbo products but not nearly as many conforming loan options. Mortgage companies that tend to specialize in the jumbo category built special relationships with jumbo investors and build their market and mortgage products around this strategy. Getting jumbo financing isn’t all that different from a conforming loan and all one might discover is the minimum down payments for a jumbo loan are greater and mortgage rates may be slightly higher although that has started to change in recent years.

Up until around 2007 and 2008, jumbo financing was across the board. Stated income, even 100% financing programs were introduced. No document loans could be found where nothing regarding the financial details of a borrower was verified. Yet after the mortgage collapse, jumbo lenders pulled way back and it wasn’t really until around 2012 when jumbo lenders got back in the mortgage game and rates began to more resemble conforming rates than those for a jumbo loan.

Today, borrowers can expect to put at least 10% down payment for a jumbo loan with a full suite of mortgage rate product offerings. However, select lenders are now again offering up to 95% Jumbo mortgages in Seattle with fixed rates ranging from 15 to 30 years or adjustable rate hybrid offerings of 3/1, 5/1, 7/1 and 10/1 programs. Hybrids offer a slightly lower rate than a fixed rate product for an initial fixed period of time before turning into an adjustable rate that can change annually. Buyers can learn more about the 95 percent Jumbo financing options in the video below.

Programs that require only a 5% down payment and utilizing a second lien for the remaining 15% percent, keeping the first mortgage at the 80% loan-to-value level and avoiding mortgage insurance. Your loan officer will be able to do the math for you to see if putting , 5%, 10% or 20% or more is better for your personal situation.

Mortgage companies that specialize in the jumbo product know which type of jumbo program best suits your needs. While most jumbo lenders approve an application in much the same fashion, sharing basic qualifying guidelines, there can be other “tweaks” to an approval process that one jumbo lender has that another does not. For example, one program might only require one year’s worth of federal income tax returns instead of two for the self-employed applicant. This can be advantageous to someone whose business had a down turn one year but recovered nicely in the next. Because most programs average year over year business income, one bad year could keep someone from getting approved. Other differences may be different credit scores and down payment requirements. Some programs allow for higher debt ratios than others.

The point is this- while jumbo loans are all categorized by the size of the loan, there can be differences from one program to the next. Experienced jumbo lenders know just where to look when a special circumstance comes into play.

Five Stars assists buyers in across the country including those in Washington: Seattle, Spokane, Tacoma, Vancouver, Bellevue, Kent, Everett, Renton, Yakima, Spokane Valley, Federal Way, Bellingham, Kennewick, Auburn, King County WA.  They can be reached at ph: 800-871-2636  or by visiting www.FiveStarsMortgage.com 

 

 

 

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Texas 100 Percent USDA Rural Housing

USDA loans TexasTexas 100 Percent USDA Rural Housing: Did you know that certain Government backed mortgage programs like USDA Rural Housing offer flexible home financing option for first time home owners in Texas?  First time buyers starting out don’t have many options today to purchase a home with NO money down.  In fact VA and USDA are the only government loan options that still allow TX buyers to purchase a home with $0 cash down payment. The USDA home loan program offers many advantages buyers just won’t find in an FHA loan or conventional loans. A few of these advantages include:

  • 100% financing – That’s right, the USDA mortgage is one of the only remaining mortgage programs in the country that require absolutely no down payment for the purchase of a home.
  • Low monthly mortgage insurance, 100% financing.
  • No cash savings requirement.
  • Texas USDA RD loans program allows for closing costs to be either paid by the seller in full, or permitted to be accumulated or “rolled into” the total amount of the loan if home appraisal is high enough. This allows buyers to need very little money upfront to buy your home.

The USDA 502 Guaranteed loan is available to all home buyers purchasing in eligible locations. The program is not reserved exclusively for first time home buyers. Even better, buyers are not required to take any special class to get approved. Complete a loan application and search for a home all in the same day! Give us a call at 904-302-6060 or just submit the short info request form on this page.

Buyers will need to insure they meet basic lender loan qualification requirements below:

  • The property must be located in an area that is designated Rural by the USDA Don’t let the word “rural” discourage you as many suburban locations just outside of Austin, San Antonio, Midland, Lubbock, Amarillo, Beaumont, Fort Worth and Odessa are still approved. Buyers in more populated locations like Dallas and Houston are encouraged to learn more about the FHA Mortgage here.
  • 620 credit score required to get approved
  • USDA Rural Housing is available for primary home transaction only (no investment properties or second homes)
  • Available for first time buyers or seasoned home buyers (Buyer cannot own another home at time of purchase)
  • Buyer income is limited to a maximum of 115% of the median income Please contact us for the latest USDA income limits in Texas
  • W2 income or self-employed is allowed (income and employment must be fully documented)
  • Gifts for closing costs or down payment (if desired) is permitted
  • The home purchase price including upfront USDA Guarantee Fee can be financed into the loan
  • Seller or lender can contribute up to 6% of the sales price toward the home buyers USDA closing costs
  • Single family homes only (no mobile or manufactured housing)
  • Safe 30 year fixed interest rate

USDA Mortgage Source serves home buyers in all 50 states. Contact us today to learn more about 100% financing options available.  Ph: 904-302-6060

Serving: Houston, San Antonio, Dallas, Austin, Fort Worth, El Paso, Arlington, Corpus Christi, Plano, Laredo, Lubbock, Garland, Irving, Amarillo, Brownsville

 

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Florida Government Home Loans

Florida Government Home LoansPretty much all Florida Government home loans today –  FHA, USDA Rural Housing and VA – require the similar things when getting pre approved. Here are several key points to think about when deciding to apply for a Government home loan. First time home buyers will find this information especially useful, please contact us below with any questions.

 

Credit Profile:

In most cases a 620 FICO score is necessary to get approved for the USDA government home mortgages today. Other programs like FHA and  VA loans can be done with possibly lower scores down to 600, especially with larger down payments.  In addition do not forget that a credit score requirement DOES NOT guarantee loan approval, just about all banks and lenders have even more waiting conditions concerning home buyers having any previous bankruptcy short sale or property foreclosures. Even more time is also required for USDA Rural loans. A clean One year monthly payment history on any other consumer credit lines is crucial to look after.

Household Income:

Your income should be consistent and documentable in 2016. The times of “stated” type income or no documentation loans are long gone. Showing income properly will often present an issue with self employed or 1099 workers, particularly those who have not been independently employed for not less than two years. Finance companies and banks frequently wish to see a 2 year employment history. Minor interruptions in a borrowers job history might be okay, just as long the gap isn’t a long time, or unexplained. Examples would be a bad illness, maternity leave, etc.  Recent college graduates enter the work force are usually are exempt from the 2 year employment regulation.

100% Rural Housing USDA Mortgage:

USDA loans are available to just about any home buyer wishing to buy a dwelling in a rural approved location. 100% financing, low fix rate term and easy approval makes this an excellent choice for eligible home buyers. But don’t automatically think “way out in the country” Many locations in Fla are still approved and “zoned” for USDA.  Even some suburban communities around Jacksonville, Tampa, Orlando, Gainesville, Ocala, etc.   Click here for the USDA eligibility map. USDA loans do have household income limits according with the amount of family members in the home, county, etc. Read all the USDA FAQ’s here. The link is loaded with tons of helpful information.

Other Home Financing Options in Fla:

FHA Home Loans

FHA financing is the most popular government back loan program. FHA home mortgages have to have a minimum 3.5% down-payment, there are no net income limits, regulations or property location disadvantages. FHA also permits the home seller to pay buyers closing costs. Contact us below learn all about FHA mortgage loan standards in Florida.

VA Home mortgages

Offered to all eligible prior and existing armed forces members. VA is one of only two home loans that allows 100% financing.

  • VA 100% financing home purchases: Most conventional lenders require at least 10% down payment which is not possible for many Veterans and military families. FHA requires a 3.5% down payment and has very high monthly mortgage insurance. Because a VA Mortgage is guaranteed to the lender (by Veterans Administration) they do not require a down payment.
  • VA loans do not have mortgage insurance (PMI): Even with $0 down payment, a VA Mortgage does not have mortgage insurance (PMI) as part of the monthly payment. Conventional programs with less than 20% down and FHA both have expensive mortgage insurance that can cost buyers several hundred dollars every month. No PMI is a huge advantage of VA loans.
  • VA loans have very low interest rates: Because VA Mortgages are guaranteed by the Department of Veterans Affairs, the risk level associated with default is much lower. As a result the interest rates are usually lower than a conventional program with less than 20% down. Like a VA loan, FHA and USDA loan programs are also backed by the government and have similar interest rates.
  • Easy qualifying criteria: VA Mortgage guidelines are more flexible than many other loan programs. The VA mortgage is guaranteed by the government and most lenders have lower credit requirements, making them easier to qualify. Current minimum credit score requirement for most lenders is 620.

Homeowners that presently have a VA, USDA and FHA loan can also look into the wide range of streamline loan refinancing alternatives available at this time. Interest rates are currently the lowest they have been all year. All these products allow the home owners to re-finance REGARDLESS of the mortgage loan to value. If you now have a USDA Mortgage loan, contact us to find out more about the USDA Pilot refinance program. Homeowners that have a VA loan can learn more about the VA IRRRL Refinance here.  Homeowners with a FHA can learn more about the FHA Streamline here.

Have a question? Contact us today at ph: 904-302-6060 – we serve home buyers nationally. Also feel free to submit the Info Request Form located on this page for quick service.

Serving Fla: Jacksonville, Miami, Tampa, St. Petersburg, Orlando, Hialeah, Tallahassee, Fort Lauderdale, Port St. Lucie, Pembroke Pines, Cape Coral, Hollywood, Gainesville, Coral Springs, Miramar, Clearwater, Sarasota, Naples, Ocala, Daytona Beach

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