Conventional Cash-Out Refinance and/or Heloc

 

In some cases, a simple cash out refinance by itself or in combination with a Home Equity Line of credit will accomplish what you want to do in the most efficient manner.

 

  • Up to 90% loan to value for cash out on home values up to $1.4 million!

  • The lowest rates and highest loan to value available for these products.

  • HELOCS up to $350,000 at 90% ltv

 

Homestyle Renovation Loan

 

The HomeStyle Renovation loan allows you to buy a home and fix it up, or refinance and remodel your current home using the as-completed value of the home for the loan to value calculations.

  • Low FNMA interest rates

  • Loan Amounts up to HI-Balance FNMA Limits..ie..$562,350 San Diego County, $625,500 in Orange/LA/SF

  • Loan amount is based on the “As-Completed” value of the home, not the current value!

  • Purchase or refinance & remodel.

  • 5% minimum down payment for primary, single-family residences (10% for second homes).

  • 3% seller contribution allowed.

  • Gift funds allowed on owner occupied, primary residences with minimum 3% down payment.

  • Cosmetic and structural renovations allowed.

  • Up to 50% of Future Value can be renovation cost

  • Allowable improvements can include landscaping, appliances, swimming pools and more.

  • The repairs can be structural or cosmetic, but they must be attached to the property and add value.

  • Investment properties allowed to 85% of as-completed value.

  • Include your mortgage payments while you remodel.

  • Includes “soft cost” – plans, permits, reports, designs and more.

  • Start improvements right after closing.

  • Requires the use of a General Contractor.

  • The HomeStyle allows for a simple 5 draw disbursement.

  • Minimum credit score is only 620!

 

Construction Loan

A Construction Loan is what you need if the loan amount required exceeds the FNMA county loan limits stated above, or if you; are building from ground up, need more than 5 draws, will need more than 6 months to build, or if you desire an adjustable rate mortgage instead of a 30 year fixed rate.  These are bank loans that are not sold off to FNMA.   In Southern California from May 2014 through November 2014,  more than 25 banks have funded Construction Loans.  These banks all have slightly different appetites, lending parameters, underwriting guidelines, qualification criteria, and rates/terms.  Below are the general similarities.

  • Single-close permanent loans

  • Interest-only payments during construction, then convert to 3/1, 5/1, 7/1, 10/1 ARMs for 30 year terms.

  • Loans amounts to $2 million at 80% LTV or LTC (see below) are typical.

  • Loan amounts over $3 million available at lower leverages.

  • Loan amount is based on the “As-Completed” Value (LTV) if the land has been owned for 1 year or more.

  • Loan amount is based on the Purchase Price plus Project Cost (LTC) if the land has been owned for < 1 year.

  • Can be used as a purchase or refinance.

  • Includes all “soft costs” – plans, permits, reports, designs, intererest reserve and contingency reserve.

  • Construction phase up to 24 months allowed.

  • Draws are usually about 1 draw per month of construction phase.

  • Requires the use of a General Contractor, exceptions made for Owner-Builders w/ licensed project manager.

  • Owner Occupied at max leverage. Second homes and investment properties allowed at lower leverages.

  • Debt ratios are typically 45%, but can go higher depending on scenarios.

  • Minimum credit scores are typically 680, with 720 for max leverage.