equity: Divorce Buyout Refinancing Explained
- 02/17/22 07:38 AM
Divorce Buyout Refinancing Explained
It's a sobering fact that nearly 50% of married couples will decide to go their separate ways each year. But what happens when there's jointly owned real estate involved? And what if that home has a mortgage on it as well? What's the process for one spouse "buying out" the other and how can any couple best plan for this division?
Obviously, a marital separation is stressful enough. The short video below aims to make it a little less so, at least when it comes to understanding the home loan options. Oh, and we rock some Frontiers-era Journey while … (9 comments)
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equity: HELOC or Cash Out Refinance?
- 02/03/22 07:52 AM
HELOC or Cash Out Refinance?
As a teenager in the '80's, our dilemmas were a little simpler --- should I stay or should I go? --- for instance. But today's homeowner faces some additional complexities, especially when it comes to deciding the best way to finance a home renovation or other large purchase.
Using the equity in one's home has always been an enticing way to cost-effectively confront large-ticket expenses, but what's the best way to convert that equity into cash? Should you get a home equity line of credit (a "HELOC") or should you do a cash-out refinance? We get this question … (5 comments)
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equity: How to Get Rid of PMI on Your Mortgage
- 12/09/18 08:24 PM
How to Get Rid of PMI on Your Mortgage
Nearly every home buyer initially hates the "P" word --- PMI, or private mortgage insurance. Years and years of conditioning have taught generations upon generations of first-time buyers that PMI is something to be avoided at all costs, and even though I daily go to great lengths to demonstrate this is patently untrue, even those that come to see the light about PMI and find themselves with a form of private mortgage insurance will soon arrive at their next concern: "When can I remove the PMI from my payment?"
Good Housekeeping
In the spirit of … (5 comments)
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equity: Packing Light for Your Departure Property
- 11/12/18 10:08 PM
Packing Light for Your Departure Property
I fielded a call this week and it's one that comes in quite frequently. "We saw a place we really like and are thinking about putting in an offer. But we don't know what we're going to do with our existing home and don't think we have time to sell it first..." It's the classic "buy first" dilemma that I've covered before.
It's fair to assume that one place the mind goes when dealing with the "what to do" of the existing home is the notion of lining up a renter. Our buyers in this situation recognize that … (10 comments)
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equity: Debt Con Goes DEFCON
- 09/30/18 07:51 PM
Debt Con Goes DEFCON
Back in the Cold War era, the Joint Chiefs of Staff implemented a new system to indicate military readiness and they called it the 'defense readiness condition,' or DEFCON. They gave it five levels, "1" being imminent nuclear war. So let's use this model --- along with some crafty adaptations --- to demonstrate how debt consolidation refinances can also reach critical levels as a consumer manages his finances along with the value of the his home. It's important to remember that managing your mortgage and other debts always requires vigilance, just like military preparedness. With a nod to … (10 comments)
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equity: Caution: Collateral Crossing
- 08/01/17 06:36 AM
Caution: Collateral Crossing
A while back, and in this post here, I talked about the four distinct ways that a homebuyer could purchase a new home without first selling his existing one. And of the options, perhaps the least understood and most complex is the cross-collateralization program. This is a type of financing where more than one piece of property serves as the real estate security for the loan and usually it implies that the existing home and the new home will BOTH make up the collateral value by which the loan-to-value (LTV) will be determined. I thought I would provide a real … (5 comments)
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equity: California's Stunning Bridge (Loan)
- 04/22/17 06:18 PM
California's Stunning Bridge (Loan)
It is 2017's peak buying season in the San Francisco Bay Area and many buyers in this competitive, low-inventory market face a challenge greater than just the inability to find the right house. For them, there's actually a more pressing dilemma. Before they can even put in an offer on the home of their dreams, they've got a home of their own to sell first.
But it's not as if these buyers have a concern they won't sell their current house or even get top dollar for it. On the contrary, they're quite sure that once it's listed for … (2 comments)
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equity: Finding Harmony in Unison
- 03/15/17 09:42 PM
Finding Harmony in Unison
Ever since the woebegone days of Greenpoint Mortgage's 400+ page rate sheet (and those who remember are laughing right now...) we in the mortgage lending industry have become accustomed to recognizing that not every borrower and not every scenario will fit exactly in the credit box. That's just been a reality of the post-Dodd-Frank era. Lending solutions rarely "check all the boxes" and I hear myself reminding clients, not infrequently, to "not let the perfect be the enemy of the good."
So you can imagine that when we start talking about jumbo loans and lower down payments AND … (3 comments)
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equity: 5% Down Jumbo: Good Things Come to Those Who Hustle
- 03/03/17 05:14 AM
5% Down Jumbo: Good Things Come to Those Who Hustle
"Things may come to those who wait, but only the things left by those who hustle." ~Abraham Lincoln
Here in California, and especially the San Francisco Bay Area, we have proudly earned a strong reputation for being able to deliver jumbo mortgage options to those who are buying homes with less than a full 20% down payment. The comments and testimonials are out there on Yelp, on LinkedIn, on Zillow. Now I know there is still a camp out there that think this can't be done, so I just want to warn these folks … (1 comments)
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equity: Breaking Up (Is Subject to Guidelines and Restrictions)
- 01/28/17 05:22 PM
Breaking Up (Is Subject to Guidelines and Restrictions)
When we look at our refinance business, not a small percentage of it is driven by the scenarios where one spouse buys out the equity of the other, as stipulated in a divorce decree. Sometimes when we are presented with a divorce buyout refinance we have to educate all the parties to the transaction on how to navigate the lending guidelines that govern these situations and, as you might expect, divorce buyouts are often done in a stressful environment. So for those who may be looking to get an overview and understanding of the process, … (25 comments)
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equity: MTG Fight Night: 80-10-10 vs. REX
- 07/26/14 12:41 PM
MTG Fight Night: 80-10-10 vs. REX
The tale of the tape:
80-10-10 Piggyback Loan vs. REX Homebuyer
$1,100,000 Purchase Price $1,100,000
$110,000 Down Payment $110,000
$625,500 First Mortgage $880,000
$364,000 Second Mortgage $N/A
$905,634 Balance @ Month 84 $748,393
$1,263,554 Value of Home @ Month 84 $1,263,554
$404,984 Total P&I Payments $331,934
$358,190 Net Equity @ Month 84 $339,739
In the blue corner, purchasing a home worth $1,100,000 and hailing from Los Angeles, "The Pig" has a 10% down payment and will finance his purchase with an 80-10-10 loan. His first mortgage is … (1 comments)
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equity: 80-10-10 Mortgage
- 05/05/14 08:12 AM
80-10-10 Mortgage
I was born in 1970.
My grandmother would refer to the Frigidaire, or launder our filthy Dungarees.
A great day was "go to work day" with Dad in Manhattan. There, we might Xerox our handprints and maybe even be allowed to get a Coke with lunch.
You get the idea. I'm talking about genericide --- using a brand name in place of concept or thing. I see this happen all the time in the home finance business with 80-10-10 mortgages, also known as piggyback loans. The short video below explains the basics and, I hope, addresses any confusion or misconceptions quickly and … (7 comments)
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equity: 10% Down with Pledged Assets
- 04/08/14 12:49 AM
10% Down with Pledged Assets
Here in California, I come across a lot of home financing scenarios, especially on the jumbo side, where the buyer would prefer to make a 10% down payment instead of a 20% down payment. And what we commonly see is that as the price range of the home increases, so too does the difficulty of only contributing 10% to the purchase transaction. What can these buyers do? We have three highly effective solutions:
80/10/10, or "piggyback" financing. This works well for home prices in the range of $825,000 to $1,100,000. Since a second mortgage, or 80-10-10 … (0 comments)
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equity: A Look at the REX Homebuyer Program
- 03/30/14 01:39 AM
A Look at the REX Homebuyer Program
In previous blog posts I've talked about the REX homebuyer program, and the short video below covers the main points of this equity share agreement. I'm pleased to report from recent experience that REX down payment funding is allowing buyers to reach up in price point, and where there may be more inventory, and qualify for homes that were previously thought to be out of reach. A buyer takes on no additional debt when using REX --- it is not a second mortgage. Remember these key thresholds for the REX program when pairing it … (0 comments)
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equity: Non(QM)sense!
- 03/24/14 09:15 AM
Non(QM)sense!
Going into the January 10, 2014 inception date of the Qualified Mortgage, or QM, we in the mortgage industry faced a nonstop barrage of concern about whether or not our lending capacity would stay the course or steadily devolve into nonexistence.
This turns out to be a nonissue here at RPM because we've just rolled out a suite of jumbo loan programs (and to say "jumbo" is nonfactual because the lower limit can be as little as $250K) that address the varied borrowing needs of those for whom mortgage credit has been nonaccessible over the last 5 or 6 years.
All … (2 comments)
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equity: You Can Pledge Allegiance But Can You Also Pledge Assets?
- 01/27/14 01:20 PM
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equity: How to Survive an Appraisal That Comes in Low
- 01/16/14 09:35 AM
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equity: What Happens If My Appraisal Comes In Low?
- 12/03/13 08:36 AM
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equity: Going, Going, Gone: Foreclosures in Marin
- 10/14/13 01:08 AM
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equity: Weekend Availability + Quality Appraisals Every Time
- 11/11/11 05:57 AM
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Divorce Buyout Refinancing Explained
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