Love My Work!

I love helping people with their loans and Real Estate needs!

Love My Work

On this Labor Day I salute all of the hard work done by so many people in my industry that allow me to do what I do!

And of course a special thanks to all of my clients who have trusted me over the years to assist them and their families.

HAPPY LABOR DAY TO ALL…

Imperial Mortgage has been helping families with downsizing, buying or selling real estate, mortgages conventional and reverse, in the greater Placer and Sacramento counties.

Reverse Mortgages

Reverse Mortgages and Reverse Mortgage Loans

If you are 62 or older and need to borrow money, leveraging your home’s equity through a reverse mortgage or reverse mortgage loan is an option. At Imperial Mortgage, we believe in looking carefully at our clients’ financial and life situation and recommending the best options, and carefully explaining the advantages and disadvantages for the most informed decision.

reverse-mortgageReverse mortgages can be difficult to understand. At Imperial Mortgage, we want to help with reverse mortgage education to help you make the right choices. Essentially, a reverse mortgage is a loan in reverse. Instead of borrowing the money, then paying it back over time, you are paid the month over time, then repay the loan when you are no longer living in the home.

Reverse mortgages can be a great solution for someone who needs long-term, steady source of income. But reverse mortgages are not suitable for everyone. Let’s look at the reverse mortgage pros and cons so you can see how Imperial Mortgage works with you to educate and empower you to make smart financial decisions.

Reverse Mortgage facts

There are two main types of reverse mortgages for seniors age 62 and older. A traditional reverse mortgage lends the value of the home’s equity, in monthly payments, to the borrower. The mortgage is repaid when the home is vacated by the borrower or sold. Reverse mortgage loans allow homeowners to convert home equity to cash with no monthly mortgage payment. In the case of a reverse mortgage loan, the cash is paid lump sum, not as monthly payments.

Reverse Mortgage Advantages

Given the right set of circumstances, a reverse mortgage can be a great way to access the equity you have gained in your home, increasing your monthly income, and offering financial security during retirement.

Reverse mortgages are flexible, offering many options to the borrower. It is important to consult with a financial advisor to determine what is best for your financial situation. Households in financial need can use a reverse mortgage to eliminate current monthly mortgage payments and may additionally quality for a monthly stipend.

Reverse mortgages have a low risk of default as there are no payments, you simply must maintain the home and live in the home. In fact, you will never owe more than your home’s value at the time the loan is repaid, even if the reverse mortgage lender paid you more than your home is worth at loan settlement – an advantage to you if the home price declines.

There are no restrictions on how the money is used and there are typically no taxes applied to the money you receive, whether that is lump sum or in monthly payments.

You can live in your home for as long as you want. You essentially lock in the value of your home, which can be an asset in preserving your wealth. The Home Equity Conversion Mortgage (HECM) is popular as it is federally insured (you’ll still receive payments even if your lender defaults!).

Reverse Mortgages Disadvantages

Reverse mortgages are not for everyone! There are some disadvantages…

Reverse mortgages tend to have high upfront fees for insurance, closing costs, and origination fees. These fees are wrapped into the mortgage so the borrower does not pay out-of-pocket. However, these fees do detract from the value paid to the borrower.

Imperial Mortgage can help by offering a NO FEE, no cost reverse mortgage. Contact us for details!

Reverse mortgages have caps or ceilings that may restrict the borrower from the full equity value of the home. The current 2017 loan limit for HECM reverse mortgages is $636,150.

While the total loan amount will never exceed the value of the loan, the amount of interest that you eventually must pay back grows larger every month.

If you are planning to move in the future, consider the length of time you will spend in your home and run the numbers. A reverse mortgage makes most sense when the borrow plans to stay in the home for many years. In fact, should you become injured or disabled and unable to remain in your home, the reverse mortgage is then settled, leaving you with the remainder of the equity, if any.

If you are currently eligible for low income assistance, a reverse mortgage may serve to disqualify you. Be sure to tell your advisor everything related to your financial situation!

Since a reverse mortgage or reverse mortgage loan decreases your home equity, this also reduces the value of your heirs’ inheritance. Be sure to consult your financial advisor on the matters affecting your estate.

These are a few of the reverse mortgage pros and cons. Everyone’s life situation is unique. Talk to someone who wants you to make the best-informed choice. Talk to Imperial Mortgage & Real Estate, serving Placer, Sacramento, and Nevada counties for 25 years!

Imperial Mortgage & Real Estate Services
Buying, Selling, & Home Loans Made Easy
Helping You Close for Less
800-961-CASH

contactus@50pluspro.com

Fed to Increase Interest Rates?

We will soon have a new President… How will the economy respond?

Fed Sends New Signals About a Possible December Rate Increase…

In this recent Wall Street Journal article you can learn about how the Fed is considering an interest rate hike as early as next month

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With a new administration coming into Washington DC in January, it’s hard to predict where mortgage rates are headed.

What I do know is that right now I have rates in the 3s and I can lock in a rate for you for 45 days.  If you’ve been considering refinancing or making a purchase, it’s a good time to talk to me right now..

Construction Loan

What is a Construction Loan?

A construction loan is typically a short-term loan used to pay for the cost of building a home. It may be offered for a set term (usually around a year) to allow you the time to build your home. At the end of the construction process, and the house is completed, your loan converts to a permanent longer term mortgage.  This is called an all in one loan.
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Qualifying for a Construction Loan

Banks and mortgage lenders are often leery of construction loans for many reasons. One major issue is that you need to place a lot of trust in the builder. The bank or lender is lending money for something that is to be constructed, with the assumption that it will have a certain value when it is finished. If things go wrong – for instance, if the builder does a poor job or if property values fall – then it could turn out that the bank has made a bad investment and that the property isn’t worth as much as the loan. To try to protect themselves from this problematic outcome, banks often impose strict qualifying requirements for a construction loan. These usually include the following provisions:1.    A Qualified Builder Must Be Involved. A qualified builder is a licensed general contractor with an established reputation for building quality homes. This means that you may have an especially hard time finding an institution to finance your project if you are intending to act as your own general contractor, or if you are involved in an owner/builder situation.2.    The Lender Needs Detailed Specifications. This includes floor plans, as well as details about the materials that are going to be used in the home. Builders often put together a comprehensive list of all details (sometimes called the “blue book”); details generally include everything from ceiling heights to the type of home insulation to be used.

3.    The Home Value Must Be Estimated by an Appraiser. Although it can seem difficult to appraise something that doesn’t exist, the lender must have an appraiser consider the blue book and specs of the house, as well as the value of the land that the home is being built on. These calculations are then compared to other similar houses with similar locations, similar features, and similar size. These other houses are called “comps,” and an appraised value is determined based on the comps.

4.    You Will Need to Put Down a Large Down Payment. Typically, 20% is the minimum you need to put down for a construction loan – some lenders require as much as 25% down. This ensures that you are invested in the project and won’t just walk away if things go wrong. This also protects the bank or lender in case the house doesn’t turn out to be worth as much as they expected.

Providing that you meet all these criteria and have good credit, you should be able to qualify for a construction loan. Generally, lenders also require information regarding your income (to be sure you can afford the mortgage payments) and your current home, just as they would with any type of standard mortgage loan.

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How Construction Loans Work

Once you have qualified for and been approved for a construction loan, the lender begins paying out the money they agreed to loan to you. However, they are not just going to give the builder the cash all at once. Instead, a schedule of draws is set up.DrawsDraws are designated intervals at which the builder can receive the funds to continue with the project. There may be several draws throughout the duration of the build. For instance, the builder may get the first 10% when the loan closes, and the next 10% after the lot is cleared and the foundation is poured. The next influx of money may come after the house is framed, and then the subsequent payout after the house is under roof and sealed up.

The number of draws and the amount of each is negotiated between the builder, the buyer, and the bank. Typically, the first draw comes from the buyer’s down payment (so it is the buyer’s money most at risk). It is also common for the bank to require an inspection at each stage before releasing the money to the builder. This helps to ensure that everything is on track and that the money is being spent as it should.

The Construction Loan Rate

With a construction loan, as with all other loans, you must pay interest on the money you borrow. Typically, construction loans are variable rate loans, and the rate is set at a “spread” to the prime rate. Essentially, this means that the interest rate is equal to prime plus a certain amount. If the prime rate is 3%, for example, and your rate is prime-plus-one, then you would pay a 4% interest rate (which would adjust as the prime rate changes).

In many cases, construction loans are also set up as interest-only loans. This means you only pay interest on the money you have borrowed instead of paying down any part of the principle loan balance. This makes payment of construction loans more feasible.

You also pay only on the amount that has been paid out already. For instance, if you are borrowing $100,000, and only the first $10,000 has been paid out, you pay interest only on the first $10,000 and not on the full $100,000. You need to make monthly payments for this loan – just as with a conventional loan – so your monthly payments should start low when only a small amount has been borrowed, and gradually increase as more of the money is paid out to your builder.

Disadvantages

Construction loans make it possible to build a home when you might otherwise be unable to do so. Building a home can be a great experience if you want to design something unique or specific to your needs and the needs of your family. However, there is also significantly greater risk when procuring construction loans than just purchasing an existing home.Some of the potential risks include:The Home Will Not Be Completed on Schedule and on Budget. If your house is not completed according to schedule, you may have to pay additional costs for rental accommodations, or pay two mortgages for longer than expected since you won’t be able to move in. In some cases, the final payment on your construction loan will become due and you will have to pay a fee to extend that loan – at least, until the house is finished.

 When Finished, the Home Will Not Be Worth at Least as Much as It Cost to Build. You could encounter this unfortunate situation if the builder does a poor job, or if the overall housing market plummets.

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Final Word

If you are willing to take on the risks of a construction loan, and you have the financial cushion available to help you through the bumps in the road, a construction loan may be the right choice so you can build your dream home.However, if you are just looking for a place to live, if you don’t have the emergency fund to deal with building setbacks, or if you are nervous about the home building process, then you may be better off choosing to simply purchase an existing home using a conventional loan. Carefully weighing the risks and benefits is important so you know that the choice you make is the right one for you.

Private Money Loans

Looking for a private money lender?  We have the resources to assist with creating this type of loan for you.Imperial has a large pool of private investors who loan what is sometimes called “hard money”. This resource enables us to make many loans that other money lenders cannot. Funding can occur quickly with this type of loan (sometimes in as little as 3 days), although typical private money loans take 2 – 4 weeks to fund.

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As experienced private money lenders, we strive to structure a loan that fits the unique needs of our clients.  Guidelines for private money loans are just that, guidelines. We are very creative, and can help you explore and negotiate all of the private money options available. Often times, if your transaction falls outside of the typical guidelines, we can still structure a loan to meet your needs.Private money loan guidelines are pretty straight forward. They focus mainly on the collateral value of the property. Typically they will lend up to 60% and some to 80% of the collateral value. If you meet this guideline, whether looking for a private money commercial loan or private money residential loan, contact us today to go over your scenario.

If you are looking for a private money loan on an investment property, a residential refinance, a land loan or a commercial transaction you need to speak with us because we can help you immediately!

Refinancing

Refinancing is often used to lower your interest rate. If rates have dropped since you lastarp financed your home, you may want to consider refinancing. Other common reasons to refinance include paying off a balloon payment, converting an adjustable rate loan to a fixed rate loan or to extract cash equity in your home (cash out). A few reasons for cashing out include: home improvement, an education fund, and consolidating debt.

Another way to convert equity in your home to cash is a “home equity” loan. A “home equity” loan is an alternative to refinancing if your home loan has a very low rate compared to current interest rates or if you have a prepayment penalty on your loan.

Just imagine what you could do with an extra $100, $300 or more each and every month. You might decide to apply the savings toward your balance and build equity faster. Or maybe you just might want to put the money in your savings account or portfolio and watch it GROW! The best thing is. you’re in control . You decide what is best for your family!

In order to refinance you will need a current appraisal, analysis and in many cases verification of your income and assets, as well as most of the same paperwork required when you originally financed your home. Adequate property insurance and new title insurance is necessary.

Benefits to Refinancing:

  • Reduce Your Interest Rate
  • Cash Out Equity for Home Improvements
  • Consolidate Debt
  • Lower Monthly Payments

To Refinance, You’ll Need:

  • Current Appraisal and Analysis
  • Verification of Assets and Income

4 Simple Steps

Step #1: Pre-Qualification

First, you, the borrower, will fill out an application and gather up current pay stubs, W2s, 1040 Tax Forms and Bank Statements. At the same time, Imperial will review your credit to determine, along with all of the other paperwork, what is the best rate for your property and financial situation. Since different loan programs can cause different valuations for a borrower, it is good to connect over the phone or in person and find out about your needs. No rules are carved in stone. Each client is handled on a case-by-case basis. So even if you come up a little short in one area, your stronger point could make up for a weak one. It’s about compensating factors that create balance in the eyes of the lender.

Step #2: Picking a Program

Second, Imperial will select a loan program that fits your needs and lifestyle. This depends on how long you plan to keep the loan/property. If you plan to sell the house in a few years, a shorter term loan like a 3/1, 5/1 or 7/1 ARM might be suitable. If this is a home you plan to live in for the next 15-30 years, a more long-term loan like a 15-year or 30-year fixed might more suitable. Shopping for a loan is very difficult without mortgage experience, as there are so many lenders and programs to choose from, each with different rates, points and hidden fees. That’s why an experienced mortgage broker like Imperial can evaluate your situation and recommend the most suitable mortgage.

Step #3: Processing and Closing

Once you submit your paperwork and Imperial has evaluated your needs and financial situation, we get to work and research the different programs and lenders that might be suitable for you. At the same time we order an appraisal and open escrow on your behalf. Once we have an approval, our processing team works on clearing any conditions the lender might have. When conditions are cleared, we make sure documents are sent to the title company and have the escrow officer prepare all the documents for you. When all of the documents have been signed, they go back to the lender for final approval and our team works on any last minute conditions that need to be met. There is a 3-day right of rescission, meaning, if for some reason you choose to not go through with the loan you can do so.

Step #4: Fees

What does it cost? The costs are minimal to the borrower…YOU. To start, there is a credit report fee which usually runs around $17 per borrower (married couples are only $17). There is also an appraisal fee which can run from $250-$900 depending on the size of the property and the type of appraisal needed for the loan. These are the only two costs the borrower will need to pay up front. There are some closing costs, which we account for in escrow, but those are mainly for processing, escrow and title. You can also choose to pay points, or not, but this is something we can discuss in further detail if interested.

First Time Buyers

You Must Start Here

 

Picking the right Mortgage is as important as picking the right house!There are a great number of loan options available and Keith’s expertise will help you select the best one for you.  An example is if you don’t have a large amount of cash for a down payment, you might take advantage of an FHA – low down program.  Or if you are a veteran you may qualify for a zero down VA loan.  USDA Rural Loans can also have a zero down payment, depending on your income. Even conventional loans from the right lender can be as little as 5% down.

 

First Time Home Buyers in the Foothills not only need to work with a buyer’s agent who is an expert on the process but who also has the patience to answer the many questions that first time home buyers have.  Many first time home buyers aren’t clear on many aspects of buying a home such as “pending versus contingent status”, “locking versus floating your interest rate”, or the difference between homeowner’s insurance and a home warranty. Buying a home is much easier the second time around, but there’s a lot of questions that will need to be answered as the first time buyer navigates the home purchase process. At Imperial, we get a great deal of satisfaction working with First Time Buyers.

 

First Time Home Buyers should start the process by asking themselves…couple

 

• What style of home is most beneficial?
• What areas are most convenient for work and play?
• Is the desired community in a realistic price range?

 

And that’s just the beginning…There’s great excitement in buying a first home but there’s also planning that needs to be done to make sure a first time home buyer gets into a home they’ll enjoy for years to come. This includes working to locate the best and most affordable homes for a buyer and also making sure they don’t overextend themselves or rush into making a bad home purchase.

There is nothing like the pride of homeownership. For many individuals, renting is just fine as they don’t like the responsibilities that come with owning a home. But for the majority of us, there’s nothing like coming home from work to your own home. Even in a rare down real estate market, there’s still hope for appreciation in the future. Renters don’t have that hope. If owning is such a bad decision, why does the person who owns the apartment building choose to do so? The reason is that owning real estate has historically been one of the safest investments around. Best of all, you get to choose the color of the home, the quality of the home and when and how upkeep on the home is completed.

There’s also the holy grail of home-ownership and that’s the mortgage interest deduction you get on your taxes. If you compare a $1,000 rent payment versus a $1,000 mortgage payment, here’s what the mortgage interest deduction can mean to a home buyer. In each scenario above we’ll assume the homeowner and the renter are both in the 30% tax bracket. By having the mortgage interest deduction, the person making the mortgage payment gets to write off 30% of the mortgage interest portion of their monthly payments — which is the largest portion of almost all mortgage payments. Assuming 3/4 of the payment is in interest (the rest being principal pay down, taxes and homeowner’s insurance); the homeowner gets to write off 30% of $750, each and every month — that’s a savings of $225 a month each month you own the home versus renting.

Buying/Loan Process

You Must Start Here

Picking the right Mortgage is as important as picking the right house! There are many options out there to work with. From FHA or VA to USDA Rural, Conventional or Private Money.   Your circumstances are unique, but with Keith’s expertise, he can find the one that’s best for you.

10 Basic Steps

1. Select a Buyer’s Agent (Imperial) to guide you through the process.
2. Get Pre-Approved for a home loan by working with Imperial.
3. Separate search parameters into “wants” and “needs”.
4. Start the home search in an organized fashion and preview the homes with Imperial that are good fits.
5. Choose a home and put together a contract offer with Imperials support to purchase the home.
6. Conduct inspections on the home being purchased.
7. Apply for the home loan and authorize appraisal to be completed.
8. Do a Final walk-through prior to closing to ensure everything is in order.
9. Closing documents signed and get your keys to the home.
10. Move into your new home!

Home Loans

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Preparing for Your Home Loan

 

For most families, a home loan is the largest single financial transaction you will undertake. It can be a daunting experience, especially for the first-time home buyer. Therefore, having an advocate in your corner to guide and protect you through the process of securing a mortgage is incredibly important and valuable. At Imperial Mortgage & Real Estate Services, we are not just in the business of buying and selling real estate, but a specialist in the home loan and mortgage industry as well.

Here are a few items to prepare as you journey toward that new home purchase:

How much can you afford?

It is important to have a realistic idea of what you can afford before you set out looking at homes. Nothing is worse than finding “the house of your dreams” and learning the sticker prices is considerably out of your range. Your monthly home costs need to factor in, not only the monthly mortgage payment, but also homeowner’s insurance, property taxes, home maintenance, utilities, and PMI if your down payment is less than 20%.

In addition, you must consider other debt you are carrying such as car payments and credit card balances, as any lender will factor this information in to your financial assessment.

Your Credit Score

Your credit score is another measure of what you can afford as it tells your mortgage broker and lenders about your potential reliability in repaying the home loan. The majority of lending decisions are determined by your FICO score (Fair Isaac Corporation), a three-digit number that ranges from 300 to 850 where 300 is poor and 850 is excellent. The better your credit score, the less you’ll pay in interest. You are entitled to a free report and Imperial Mortgage can help you get a copy of your FICO score as well as help you interpret the results.

What Type of Mortgage to you Quality for?

There are MANY type of mortgage available today, but not all mortgages are available to all prospective home buyers. Some of the most common mortgage types include:

Conventional Mortgage
FHA Loan
VA Home Loan
30-year Mortgage
15-year Mortgage
Fixed Rate Mortgages
Adjustable Rate Mortgages (ARM)
Rural Housing Loans
203k Rehab Loan
Reverse Mortgage

There are lots of great programs out there depending on your personal situation. Don’t attempt to be your own expert. Talk with someone who will educate, advise, and support your decision on the right mortgage for you and your family.

Not only will Imperial Mortgage help you understand all the type of mortgages that you qualify for, we will also help you with current mortgage rates for each applicable program. Mortgage rates fluctuate and knowing when to lock your rate and how to balance your mortgage points with your interest rate is a key decision.

Let us be your trusted expert in “all things real estate”.

Imperial Mortgage & Real Estate – Service and Local Market Expertise. Serving Placer, Sacramento, and Nevada counties for 25 years.

Imperial Mortgage & Real Estate Services
Buying, Selling, & Home Loans Made Easy
Helping You Close for Less

800-961-CASH

contactus@50pluspro.com