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California Market Updates on Bridge Loans and Point Buydowns

September 21, 2022
Housing Market Industry Update for California

California’s eye-watering home prices seem to have peaked, but affordability remains a real challenge.

 

Meanwhile, mortgage rates keep edging up. As a result, Californians are struggling to buy homes. LendSure is here to help. We offer bridge loans to help equity-rich homeowners, and rate buydowns that help ease the affordability squeeze.

In the second quarter of 2022, the nation’s five least affordable large housing markets were located in California (1. Los Angeles-Long Beach-Glendale, 2. Anaheim-Santa Ana-Irvine, 3. San Diego-Chula Vista-Carlsbad, 4. San Francisco-San Mateo-Redwood City, 5. San Jose-Sunnyvale-Santa Clara), according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index. The nation’s five least affordable small housing markets also were in the Golden State (1. Salinas, 2. Napa, 3. San Luis Obispo-Paso Robles, 4. Santa Cruz-Watsonville, 5. Santa Maria-Santa Barbara).

Current residents of California are sitting on six-figure gains – and even seven-figure gains – in home value that they can tap by selling. But if they want to buy a new home, they need some of that equity in the form of cash so they can make a down payment.

In response to this challenge, LendSure has developed a solution: Our bridge financing empowers borrowers to access equity from their current home to purchase a new home, with no monthly payments on the bridge financing. Borrowers can gain a competitive advantage in a seller’s market by making a non-contingent offer on the new property.  The bridge financing pays off any existing mortgage AND provides cash to use as a down payment on the new property.

Another solution LendSure offers is financed rate buydown. Rate-sensitive borrowers always have had the option of paying discount points to buy down the mortgage rate. But that tactic usually carries a downside – the borrower has to pay the points up front.

To help you offer more attractive borrowing options to your California clients, LendSure has a workaround: We offer borrowers the additional flexibility to buy down their rate and finance the points so no additional cash is needed at closing. It’s a feature that gives homebuyers the best of both worlds. They get a lower rate without coming up with more money at closing.

Here are the features of LendSure’s Financed Rate Buy Down:

  • Lender buy-down points can be financed into the loan (up to 2% LTV).
  • Financed points do not raise the LTV pricing bucket (up to a maximum LTV when financing points is 87% for owner-occupied borrowers, and 77% for your investor-type loans).
  • Borrowers can take up to 87% LTV when financing points (at the 85% pricing tier).
  • The borrower does NOT have to bring additional cash to close.
  • The lower rate significantly reduces the borrowers’ monthly payment.

LendSure allows you to mix and match rate buydowns on a variety of products, including jumbo loans, interest-only mortgages, non-warrantable condo loans and investor loans.

The LendSure Way

It’s simple. We make loans that make sense. We’re not in-the-box lenders. Of course, there are numbers and ratios and data to consider, but we know that behind every file, there’s an individual with a unique circumstance seeking a loan.  We work hard to offer our common-sense take on lending to borrowers seeking funding for the home of their dreams, another addition to their investment property portfolio or refinancing of a currently-owned property.

Are you ready to grow your business? Conforming loan approval guidelines can be restrictive, but we want to offer our mortgage broker partners the education, the tools, support and the guidance they need in order to say “yes” to more of their clients.  This ensures happy borrowers and opportunities for bottom-line growth. What are you waiting for? Let’s get started!

Are you ready to benefit from a commonsense approach to lending?  Contact us today to learn more about non-QM loans and how partnering with LendSure Mortgage Corp. can help grow your bottom line.

Contact Us: (888) 707-7811