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Do You Know Your Loan Purpose? It Could Make Or Break Loan Approval!

Do You Know Your Loan Purpose Could Make Or Break Loan Approval

Are you aware that the Loan Purpose is critical to a Hard Money loan?  Actually, any loan?

Years ago, loan programs were somewhat divided along the lines of owner occupied or non-owner occupied.  The Dodd-Frank Wall Street Reform and Consumer Protection Act changed that.   Now the Purpose of the loan dictates what loan programs will be available to your Borrower. 

“Consumer Purpose” loans are generally defined as loans for personal, family or household purposes. Such loans include, but are not limited to, loans to purchase, remodel, repair or improve a principal residence; purchase a vacation home or personal vehicle or boat;  to purchase furniture, furnishings, appliances, or other consumer goods for personal use;  to pay, refinance or consolidate personal or family debt or credit cards;  or for education expenses, vacations, and medical expenses.

“Business Purpose” loans are used to purchase an investment property or a cash out refinance where the funds are used for any business purpose. The property collateralized can be owner-occupied or non-owner occupied as long as the funds are used for investment/business.  Such loans include, but are not limited to, loans to purchase, repair or improve real property for use in the Borrower’s business;  to acquire, improve or maintain certain non-owner occupied rental property;  to purchase, improve or repair tools, equipment, machinery, fixtures or furnishings used in the Borrower’s business;  for operating capital e.g., employee salaries or to purchase or pay for business inventory, supplies, rent, taxes, insurance, and other related expenses;  or to payoff, refinance or consolidate business debts.

Please note that the loan can be Consumer Purpose even if the property is a rental or commercial.  It is the Purpose that will dictate the Loan Program.  For example; Borrower has an existing rental property and needs cash out to consolidate personal debts.  That would be deemed a Consumer Purpose loan.  Another example is a purchase of a rental property.  That one will always be a Business Purpose. 

Not all Hard Money lenders will do Consumer Purpose loans, so you need to be sure and ask if you know it is Consumer Purpose.  Here at Sun Pacific Mortgage, we do finance both Programs

In the description of your Loan Scenario, please make sure to include the Loan Purpose.  This could make or break your loan approval!

Are We Looking at a Change In California Real Estate?

Are We Looking At A Change Ca Real Estate

When we review the real estate market over the past couple of months, more than a quarter of listed homes has had a price drop according to Redfin.  Additionally, the supply of homes has increased for the first time in three years according to the National Association of Realtors. There has been a market shift, especially in California.  

Median home prices remain in the higher ranges for the time being, though. Even in Silicon Valley inventory is increasing and sales are slowing.  Where a seller could expect 15-20 offers, the odds are that it will take longer to sell today, and the seller might receive only four to five offers.  

Another issue influencing the real estate market in California has been the lack of single-family construction.  There have been recent gains though in this arena with new construction increasing 16% over last year.

All these factors mentioned above bode well for Buyers in today’s market: You may not need to scramble as much to obtain your dream home, but on the other hand, you may not be able to sell your present home as quickly.  That’s where a Bridge Loan from Sun Pacific Mortgage comes to the rescue!

Bridge loans allow you to purchase your new home before selling the present one, and this is just one of the many lending programs you will find that we offer.  

So, give us a call at 707-523-2099 and see what we can do for you in this ever-changing world of real estate.

Selling Your Home in Today’s Market

Selling Home In Todays Market

It is never a fun adventure to sell your home, especially while you’re still living in it.  And in today’s market, where multiple offers are not the norm they once were, it is even more important to observe some basic rules.

Keep your home pristine!  Not just “picked up”, but sparkly clean.  It should look like a model home where no one lives.  I know this is well-nigh impossible, especially with kids in the house, but it’s worth some effort.

Pay attention to your yard.  There should be no leaves, no weeds, and no spider webs in the corner of the porch or patio.  Spruce it up with some colorful plantings, even in the winter.

Leave when you have showings.  That means pack up the kids and pets and just drive around, if that is what it takes to clear out of the house.  There are legitimately people who are allergic to or fearful of dogs or cats and may not even enter the property if they are present, so it is important to take them with you.  Otherwise, you may lose a potential buyer!

You may get a ridiculous offer.  Don’t be tempted to give away the farm to clinch the deal.  Remember you’re just selling your house. Be open to negotiating, but don’t allow desperation to cloud your judgement.

These ideas are meant to make selling your home an easier process, one as painless and as fast as possible while still getting the most money for your house.

If you are not working with a licensed Realtor, contact one from a local real estate company.  And if you are considering buying another home in California, then contact a licensed and experienced Lender who can help you take advantage of any existing home equity to purchase another home prior to selling your current house.  This could be beneficial to you and your family.

Good luck to you!

The Good, The Bad, And The Ugly Of Marble Countertops

The Good The Bad And The Ugly Of Marble Countertops

When building or remodeling, owners are faced with a myriad of confusing choices, not the least of which is what material to use for their kitchen counters.  Among the many preferred options are: granite, solid surface material, butcher block, concrete, and marble, specifically Carrara marble.

Marble is gorgeous both from a distance and up close, but unless you are familiar with and ready to maintain it, it also has some drawbacks.  Let’s examine a few:

  1. It won’t stay pristine for long:  Marble is easily scratched and stained.  You can’t chop vegetables directly on it as acidic liquids will stain the surface permanently.  Marble is more porous than natural stones or solid concrete.
  2. It can be seriously tricky to clean:  Acidic liquids of any kind, including organic cleaning products, are bad for marble.  Cleaning requires a special kind of cleaner which can cost at least $10 for 16 ounces.
  3. It requires extra work to protect it:  A seal can help protect your countertops, but it requires regular maintenance.  The recommended resealing process is every 3 – 6 months to maintain the luster and prevent staining.
  4. It can be bad for resale:  In five to ten years this product is likely to look very different and be less appealing to a prospective buyer than any other stones, which may age better with less maintenance.

Some lifestyles present additional reasons to resist the urge to install marble, for instance:   if you use the kitchen heavily, if you have children who will be eating or playing on the surface, or if you don’t have the interest/time for the maintenance it requires.

If you are a fan of HGTV shows, you would think that Carrara is the “go-to” for every project, and they do look beautiful when they are first installed.  What you don’t get a chance to view is what Carrara looks like after the family has lived in the house for any length of time. With all the other options out there, maybe foregoing Carrara isn’t such a difficult decision.

The moral of this article is: Study up on your preferred material for countertops before you buy them. You want to make sure you’ll be happy with it for years to come, as it is your home!

If you’re doing renovations or interested in alternative financing for your home or rental, call us today (707) 523-2099!

To Buy or Not To Buy?: That is the Question

To Buy Or Not To Buy?: That Is The Question

Although not as existential as Hamlet’s query, this is a life changing decision facing many Californians today. Ultimately, the answer depends on several real-life factors: your finances, your long-term plans and the real estate market in your area.  Some of the questions you might want to ask include:

  • What can you afford?
  • How much do you have for a down payment?
  • How long do you plan to stay in the house?
  • Are you looking for stability or flexibility?
  • Do you want to be responsible for maintenance and repairs?
  • What are your financial, career and family goals?

Of course, the other choice you have is to continue renting.  A wise next step in your decision-making will include a Pros & Cons List of renting vs. buying.  It can look something like this:

Pro Buying:

  • Builds equity and credit
  • More stability (especially with schools)
  • Some tax benefits
  • Can “nest”, improving or upgrading to your tastes
  • Social benefits of a stable neighborhood

Con Buying:

  • Requires substantial money, paperwork upfront
  • Additional expenses beyond mortgage payment
  • Responsible for repairs and maintenance
  • Moving costs

Pro Renting:

  • Fewer upfront costs
  • Mobility
  • Not responsible for maintenance/repairs
  • No property tax bills

Con Renting:

  • Landlord can raise rent or sell the property
  • Choices may be limited
  • Might mean moving several times
  • Don’t build equity
  • No tax benefits

To summarize:  Homes typically increase in value (approximately 7.2% in California in 2017) thereby increasing your retirement fund, whereas, every penny spent on rent is gone forever.  Your homeowner costs are more predictable and stable than renters’ expenses, since a landlord can raise your rent in accordance with the rent control laws in your city every year.  If you own a portion of your mortgage, interest and property tax is deductible. There may be a small renters’ deduction if you rent.

To help evaluate your choices regarding buying/renting there is a helpful calculator available on Zillow: https://www.zillow.com/rent-vs-buy-calculator/  

When you reach the decision to buy, but find you do not qualify for a conventional loan, you need a fast loan or stronger offer over others, Sun Pacific Mortgage will be here to help you achieve your dream!  We have unique alternative financing options through our Hard Money lending programs.

Call us at 707-523-2099!

Why Should I Sell My Home This Fall?

Autumn Home For Sale

There are probably a myriad of reasons to sell this Fall, but let’s look at just a few:

For starters, Buyer demand is still strong.  While the mad, competitive scene has waned (thankfully!), last month listings averaged only 29 days on the market according to NAR.  Although the housing inventory is still less than 6 months (which is considered “normal”), it appears that we are slowly moving toward normalcy in the real estate market. This means we will no longer be in a buyers’ market (like 2007-Feb.2012) or a sellers’ market (like Mar.2012-present).  The experts see the housing market returning to a healthier state for seller and buyer by the end of next year.

What about pricing?  According to Core Logic, housing prices are expected to rise 5.1% next year.  As a result, if you wait, you will end up paying more for a down payment, and your mortgage payments may likely increase.   Because of the persistent inventory shortage, prices should continue to rise to above-normal levels for the next year. On the bright side, both existing and new construction permits have increased over the past two months, and these factors will help make a more balanced market in the future.

If you do not qualify for a conventional loan this Fall, Sun Pacific Mortgage is here with a lending program for you.  Whether you need a bridge loan to help with a new purchase before your present home sells, or you just want a hard money 1st, we will find a satisfactory solution for you.  Give us a call at 707-523-2099 and see what we can do for you!

How To Significantly Increase The Value of Your Rental Property

Increase Rental Property Value

One of the best ways to insure the value of your rental property and increase your cash flow is to maintain and manage it well.  As a landlord you should be vigilant that your property does not depreciate because of your inattentiveness. Markets may fluctuate, and while this is something you don’t have particular control over, you can ensure that your property does not lose any value because of neglect.  

Here are some time-proven and relatively low-cost improvements that should increase the rental value and rentability.:

Landscaping Refresh:  

If the prospective renter sees a tidy, colorful front yard, it helps sets the stage for a more positive reaction to the interior.  A new mailbox or a freshly painted one can be a big plus.

Thorough Cleaning:

If painting the entire house is financially prohibitive, a good scrubbing inside and out will go a long way to say “this landlord cares”.  In particular, making sure the front door is welcoming and fresh. A newly painted door gives the impression that you have renovated the house for the next tenant.

Clean the Floors:

Cleaning the rugs, either by yourself or professionally, makes the house smell clean and will have an impact on the overall appearance of the home.  Any repairs required of other types of floors, regardless of cost, shouldn’t be ignored.

Appliance Upgrades:

One of the most important aspects considered by a prospective renter is  the kitchen, and more specifically, the appliances. If a good cleaning doesn’t bring them up to par, replace them!  It will get you a better renter and a better price. The other room where you don’t want to spare any elbow grease is the bathroom.  Tenants appreciate an up-dated, clean and bright bath.

Now that we have examined the extensive “To Do List” for attracting responsible renters, let’s take a look at how you will finance these improvements.  

The first avenue would be to look into a conventional loan or home equity loan, but if, for whatever reasons, you do not qualify for a conventional loan, consider a Hard Money loan from Sun Pacific Mortgage.  

We have been in the business of hard money refinancing and lending for investment property owners for over 30 years.    Please call us at 707-523-2099 with any of your questions or scenarios.

Why Should I Buy Today Instead of Waiting?

Image1 Today Most Industry Leaders Would Agree That Waiting For Home Prices To Drop Significantly Before Buying Property Is Very Unwise.  The Latest Reports Anticipate At Least A 5.2% Increase Over Last Year’s 7% Increase In Property Values.

Today most industry leaders would agree that waiting for home prices to drop significantly before buying property is very unwise.  The latest reports anticipate at least a 5.2% increase over last year’s 7% increase in property values.

Besides anticipating a jump in market pricing, another reason to make your move now is the inevitable interest rate hike.  The 30-year mortgage has increased by half a percentage point already in 2018. Most institutions involved in lending are projecting the rate will have increased by a full point by this time next year.

It is good to remember that whether you own or rent, you are paying a mortgage, your own or your landlord’s.  The obvious advantage of paying your own mortgage is that you do not need to concern yourself with unwanted surprises, like rent increases and decisions made by your landlord that jeopardize your living arrangements.

Another reason to consider home ownership is the “forced savings” it affords.  The equity your home accrues throughout the years will allow you to tap into substantial funds later in life.

If the right thing for you and your family is to purchase a home this year, consider buying sooner rather than later.  And if you think you can’t qualify for a loan, consider the option of a hard money loan with Sun Pacific Mortgage, where your credit score, condition of property and difficulty to prove income is not our first concern.  Call us today! (707) 523-2099

How To Maximize The Profit From The Sale Of Your Home

Valueofofyourhome Selling Your Home Can Prove To Be Either A Smooth Or Bumpy Process With Varying Rewards.  Two Keys To Ensure That Your Efforts Yield The Highest Price Possible Are:

Selling your home can prove to be either a smooth or bumpy process with varying rewards.  Two keys to ensure that your efforts yield the highest price possible are:

  • Price it a little low:  Statistically, it has been proven that property priced below Market Value encourages significantly more interest and higher selling prices than those priced above Market Value.  When examining this concept, it becomes clear that it is better to have multiple buyers fighting with each other over your home, than for you to be fighting with one buyer over the price.  Realtor.com advises: “Aim to price your property at or just below the going rate. Today’s buyers are highly informed, so if they sense they’re getting a deal, they’re likely to bid up a property that’s slightly underpriced, especially in areas with low inventory.” 
  • Use a Real Estate Professional:  Sellers may think they can improve their profit if they don’t pay a real estate commission,. But studies have shown that homes typically sell for more money when handled by a real estate professional.  Sales in 2017 suggest that the average price was almost 6% lower for FSBO sales of similar properties.

The “Take-Away” from this article:  To maximize the profit from the sale of your home, price your house at or slightly below the current market value and hire a professional.

Interested in alternative financing or private lending for your next home purchase? Give us a call today (707) 523-2099!

California’s State of the Real Estate Market

Image1 2 The California Association Of Realtors (Car) Recently Published A Report On “The State Of The Real Estate Market”.  Some Of The More Interesting Facts Included The Following:

The California Association of Realtors (CAR) recently published a report on “The State of the Real Estate Market”.  Some of the more interesting facts included the following:

  • Price per square foot was $257, down 3.3% from December, but up 5.9% YTD
  • Inventory at the lowest level since June 2004 with supply constraints crossing all price ranges (no surprise there!)
  • Home prices started picking up in the second half of 2017
  • California median home prices continued to grow at a fast pace with January 2018 median home price at $547,800, representing an increase of +7.3% over the same period last year.

What does 2018 hold for real estate in California?  All signs point to a continued healthy market with inventory a persistent problem.  In some cases, the issues that arise from this stumbling block can be mitigated by a bridge loan.  In this instance, if a buyer finds the home of his/her dreams, but hasn’t yet listed their own home, our bridge loan program can provide the temporary funds necessary to secure the new home before selling their existing property.  When their property sells, they can pay off the bridge loan and live happily ever after in their new home.

If you or someone you know needs help getting into the market or is looking to refinance their property, Sun Pacific Mortgage is here to assist with our Hard Money loan programs.

We have found financing for many who have been turned down elsewhere.  Give us a call!

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