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CenTek’s Take on the California Housing Market

On Tuesday, S&P Dow Jones Indices released the S&P CoreLogic Case-Shiller Home Price Index. This index is an unbiased benchmark that calculates the average difference in single-family home prices in specific geographic market each month for 20 Metropolitan Statistical Areas (MSAs). This index is relevant because it shows the distinctions between our SoCal submarket, ranging from Ventura to San Diego, and the national real estate market.
For instance, throughout the last five years, the increases in home prices (y/y%) in the LA/OC region has typically been greater than the growth of home prices nationally. Specifically, between July 2016- July 2017, in Los Angeles and Orange County, prices grew by 6.1% and 7.1% respectively. This is a larger jump than the 5.9% annual increase in national home prices in this same year to year period (Graph 1).

Graph 1: S&P CoreLogic Case-Shiller Home Price NSA Index (S&P Dow Jones Indices 2017). Los Angeles Home Price NSA Index vs 20 City-Composite Home Price NSA Index

Moreover, the median home price increased to $565,330 in CA in August 2017, a 7.2% increase from August 2016 (CAR 2017). It is also noteworthy that according to the California Association of Realtors August 2017 Update, sales are continuing to grow year over year.

In today’s competive market, if a property is realistically priced based on hard-core comparables, which clearly define the property’s square footage, location, and condition, the property tends to receive multiple bids. Gloria, Curtis, and their staff will work with you and your team to strengthen your offer to its maximum potential.

Yet, despite the growing amount of sales, inventory is steadily declining. Many local markets in CA are mismatched. Compared to 2016, sales have improved in both middle and high price points but they have significantly declined at lower priced markets (Graph 2). Thus, home-buyers are priced out and consequently expanding their search zone to include neighborhoods that they might not have considered it before.

Graph 2: Sales Improve in Mid and High Priced Markets But Decline in Lower Priced Segments (CAR 2017)

Our present CA real estate market presents a new set of variables. As always, Gloria, Curtis, and the rest of our team follow new trends and policy changes in both real estate and underwriting guidelines to structure out of the box transactions. In the next half of this newsletter, we’ll share our 5 approaches that we use to help individuals prepare to make an offer. 

Approach # 1: Assist you or your client with credit scores

Despite stricter lending regulation since the housing bubble burst, there is an easing of policies with more flexible guidelines, especially regarding credit score. With a release, the CenTek team can instantly run the Three Bureau Credit Report for clients who are seeking to obtain a loan or refinance their property. Considering the recent Equifax data breach, it is very important for individuals who are interested in various financing options to un-freeze their credit, if necessary.
Additionally, if needed, we will holistically analyze the credit profile with you or your client. It is imperative that everyone monitor their credit periodically to decrease the impact of potential issues. CenTek subscribes to a sophisticated computer modeling program that will evaluate how to strategically pay down liabilities and credit cards to increase the scores.

Approach #2:  Encourage research on any comparables

As we all know, an appraisal can sometimes be unrealistically subjective based on the appraiser inspecting the property. We only select appraisers within the appropriate submarket, in terms of region, price point, and overall design.
As you all know, both selling and listing agents should be aware of any comparables the appraiser would have access to. We have noticed that it is very important to be familiar with comparables, particularly if they could impact the appraised value of your client’s purchase.
Especially when a property has turned hands in less than a year, it is imperative to document the improvements as to why the cost is X% more.  If it’s a minimal increase its not an issue. However, to avoid fraud, if the price increased by 40-50% in a year, the lender and appraiser want documentation.

Approach #3: Utilize private money when appropriate

For some clients, private money makes a great deal of economic sense and is an excellent tool for acquisition. Do not overlook the value of closing with private money within 5 days of opening an escrow— As this equates to cash and is an opportunity for some investor types.
For this scenario, the property must be labeled as an investment property, non-owner-occupied. Yes, this is a costlier loan concept. However, sophisticated buyers include this as the cost of buying. As they say, the end result must justify the means.

Approach #4: Issue up-front detailed pre-approval and approval letters

Today, pre-approval and approval letters have taken on new dimensions. Therefore, the individual seeking to obtain a loan must be totally wired with a competent mortgage broker before making his or her offer. We underwrite as one of the leading wholesalers of loans in the country and are experts in delivering packages that meet our clients’ needs.
Our in-house staff can customize and these letters to fit both your financial profile and your offer. In this competitive market, our team approves letters that waive appraisal and loan contingencies to strengthen the offer. However, we suggest that our clients keep the inspections contingency.

Approach #5- Expand your search zone

The mantra of buying in SoCal has historically been “Location, Location, Location”.  Whether it be Pasadena, south of Ventura Blvd, acreage in the 805, the view from Russian Hill in SF, or water rights in Cambria, our team at CenTek Capital Group has closed over 100,000 loans almost every neighborhood in California. 
Due to availability, pricing, lack of or thin inventory, prospective buyers are being priced out. One current example is with Pasadena as many buyers have been out priced in the middle market. and now are looking to buy East in Altadena and Monrovia.  Today, there is a lack of inventory that matches most home-buyers’ needs, causing homebuyers to expand their search zone and parameters.
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How to Maintain your Identity’s Integrity in the Digital Age: 6 Tips on How to Deal with the Equifax Data Breach

How to Deal with the Equifax Data Breach: An Important Update from CenTek

By:  Shoshana R. Cohen

 

Here are 6 tips produced in-house by the experts at CenTek on how you can maintain the integrity of your identity.  As you all know, Equifax’s database was compromised. This breach is

major because it potentially exposed sensitive information of up to 143 million Americans. As one of the 3 major credit reporting agencies, Equifax holds data relating to names, birth dates, addresses, social security numbers, and driver’s licenses. In addition to this private information listed above, the breach may also leave up to 209,000 U.S. consumers vulnerable due to leaked credit card numbers and another 182,000 consumers exposed due to hacked dispute documents.

Even though information regarding the breach was released by Equifax during the first week of September, reports show that the company’s database was compromised in May. Therefore, hackers have already had 4 months to possibly obtain one’s information and sell it to others who either have opened new accounts or intend to open new accounts in the future.

Going forward into the age of digitalization, it is crucial that everyone continually monitors his or her personal financial and social security profiles. While there are a few automated computer services we suggest, it is still imperative that one directly monitors his or her accounts. Ultimately, the hope is that if taken care of correctly, any data breach should be more of an emotional challenge than a financial burden.   

Tip #1: Check to see if you were affected

It is essential that each person know whether his or her information was compromised. Equifax set up a website at https://trustedidpremier.com/eligibility/eligibility.html where people can see if they were affected.

Tip #2: Order a free credit report

Even if one’s profile was not compromised during this breach, it is still useful to partake in the following procedures to minimize the future impact of stolen identity.

Federal law states that one can order a free copy of his or her credit report from each of the three major credit report agencies once per year through AnnualCreditReport.com. Please note that this is the only website that is authorized by the Federal Trade Commission where one can redeem his or her free annual 3 Credit Bureau report. Once the report is received, please analyze it row by row to ensure that everything is updated and factual.

Tip #3: Monitor your account

After obtaining his or her credit report, an individual can monitor his or her credit using a computer program. Because of the breach, Equifax consumers can enroll in its “TrustedId Premier” program at https://www.equifaxsecurity2017.com/enroll/ for free.

In this program, Equifax will monitor your credit and protect your identity from theft for free for a year. Equifax has clarified that signing up for this free credit file monitoring service and ID theft protection program will not waive the consumer’s right to take legal action.

After the complementary year of ID Premier is over, consumers will not be automatically enrolled into the service, which has retailed for $19.95 a month in the past.

Additionally, it is important that consumers are aware of phishing scams. Criminals prey on consumers who are interested in credit monitoring and freezes by sending legitimate looking emails. Double check that each website used is spelled correctly. Furthermore, if one does decide to extend his or her Equifax monitoring program beyond the complimentary year, be sure to do so with Equifax directly and not with a third-party.

Tip #4: Create an online account with the Social Security Administration (SSA)

The Equifax hack leaked enough information for a thief to set up an online SSA account. This is portal on the Social Security Administration website where one can monitor his or her social security benefits history, including social security earnings history and where the money is sent to.  Especially if one is nearing the age of 62, it is important to create an account on  https://secure.ssa.gov/RIL/SiView.do before an unknown third-party opens one. 

Gather together all the appropriate paperwork to open an account, as the portal asks about specific accounts to verify one’s identity. An individual will be locked out of his or her account for 24 hours if any answers are incorrect. Additionally, it is important to note that if one placed a security freeze or fraud alert on his or her credit, the individual will have to remove the freeze prior to opening an online SSA account or go into a physical SSA office to open an account there.

Tip #5: If adamant about a proactive approach, consider placing a fraud alert instead of freezing your credit

Many issues arise when one freezes his or her account. The notion of freezing credit is misleading, as it provides a false sense of safety and protection. Simply put, a frozen credit line means that someone cannot open a line of credit during the period that credit is frozen.

Freezing one’s credit is not a short-term activity because it prevents anyone (including oneself) from applying for another line of credit or from requesting a credit report in one’s name. This is not only  problematic for people who are seeking financing for a home, but also for people who want to do mundane things create a new phone line account or buy a new phone.

When one places a fraud alert on his or her personal account, businesses must verify an individual’s identity before they extend a new line of credit. However, a fraud alert only lasts for 90 days and does not typically renew itself automatically. If one is a verified victim of identity fraud, one is eligible to extend fraud alert up to a duration of 7 years.

Tip #6: Be aware of tax-related identity theft

Tax-related identity theft is among the major scams for the IRS. Even if one decides to freeze his or her credit or if one monitors his or her credit closely, he or she can be a victim of tax-related identity theft. The Equifax breach leaked enough information for someone to file a fake tax return.

The IRS also has an online portal at https://www.irs.gov/payments/view-your-tax-account where one can set up an account to monitor his or her payoff amount, balance for each tax year, 18-month payment history, and information for the current tax year.  With this tool, one can monitor their present and past tax payments and track their refunds.

According to tax laws, employers do file W-2 forms with the Social Security Administration, not the IRS. The SSA then forwards the name and number mismatches and then forwards the W-2 information to the IRS. Therefore, employer name and wage information listed on a tax return can get approved, even if it does not match the employee’s W-2 form.

However, please be aware that one does not necessarily need to rush to file your tax returns. Because of the nature of one’s employment, one may not be eligible to file their returns completely until the deadline. Yet, it is important to monitor your account through the deadline, so that no one files taxes in your name before you do. Please note that this portal is updated every 24 hours with about a 1-3 week lag period.

Thank you for your time.

Wishing you a happy, healthy, and financially safe new year!

Gloria, Curtis, and the CenTek Team

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Post Labor Day Market Update

MORTGAGE MARKET OVERVIEW

Welcome Back! We hope you enjoyed your Labor Day holiday. As we try to put the summer blues and last week’s oppressive heat behind us, let’s refocus on our personal financial matters. Mortgage rates are back to near historic lows. If you’re paying 4% or more on any owner-occupied loan, take advantage of current rates as they have fallen into the 3’s. Contact us today and send your latest mortgage statements. We can strategize on preparing a personalized refi program that matches your needs and any potential future acquisitions.

SOME IMPORTANT TAKEAWAYS FROM THE CURRENT MARKET

SIGNIFICANT SAVINGS BY TAKING YEARS OFF INTEREST PAYMENTS– Call us to find out how you can take advantage of the shorter amortization terms.

UTILIZE THESE LOW INTEREST RATES– Discover how you can benefit from transforming a fixed rate into an ARM. These can be interest only.

IT’S AN EXCELLENT TIME TO RE POSITION DEBT– Do you have student loans or other mortgages with high interest rates? Because interest rates are low, call us to learn how you can re position your debt to decrease your monthly payments.

AGGRESSIVE RATES AND SPECIAL OPPORTUNITIES

ATTENTION RESIDENTIAL RENTAL PROPERTY OWNERS: Maximize the cash flow from your investment by lowering your monthly mortgage payment. Loans up to $2.5 M. 5 Year Fixed. Interest only option available. Cash out- OK.

CALLING ALL MULTI-FAMILY INVESTORS: We have a large bank seeking apartment loans in the $3 M- $15 M range. 10 year fixed. 30 year amortization at 3.625%. Even if your other loans have prepayment penalties, take the risk out of the equation and lock in this excellent rate.

IMPORTANT ANNOUNCEMENT FOR SOON TO BE RETIRED CLIENTS: Use your IRA retirement account to qualify in lieu of income. Please note: No pledging of assets is required in any way.

RELEVANT MESSAGE FOR SELF-EMPLOYED CLIENTS: We’ll strategize with you on how to acquire property downstream. Our 1 year tax return program is very popular.

~~~INTRODUCING OUR TWO NEW PROGRAMS~~~

CENTEK KEYS TO CLOSING DEALS

CenTek works with you throughout the financial process, guiding clients through mortgages and more. Unlike direct lenders who only represent the bank, we work with a variety of wholesale banks and specialized lending institutions to package the loan to highlight strengths and minimize any issues. Contact us today and we will work with you to fine tune a game plan.

HOW WE STRENGTHEN AN OFFER TO ITS FULLEST POTENTIAL: We follow trends and policy changes in the lending arenas to help our clients prevail with their offer. We carefully organize each loan package so that you can be prepared to waive contingencies, when appropriate, and compete with all-cash offers.

CENTEK MILLENNIAL SOLUTIONS

Despite stricter lending regulation since the housing bubble burst, there is an easing of policies with more flexible guidelines, especially in regards to down payment and credit score. Although some Millennials may not have the funds necessary for a full down payment by themselves, there are many other options for friends or family to help their millennial prevail with their offer.

CREATIVE LOAN STRUCTURING STRATEGIES INCLUDE: New credit formulas, Non-Occupant Co-Borrower concepts, higher DTI ratios, gifting, and realistic “hacks” to reposition a Millennial’s credit score. Call us today to find out more!

Stay tuned for more updates on our CenTek Blog. Looking forward to hearing from you soon!

Gloria, Curtis, and the all of the CenTek Team

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Summer Update 8/25

Wow! Another summer has come and gone. Here are a few updates from our team at CenTek Capital. As you have probably noticed, it’s a seller’s market. There is a housing shortage where increasing land values and the decreasing amount of new residential construction completions are contributing to higher price tags. In order to prevail in today’s competitive market, it is imperative that both first-time and experienced homebuyers are prepared to present an offer with minimal contingencies with as short of a time period as possible.

The overall U.S. population is expected to expand from 2014’s reported 319M to approximately 360M by 2030. There is a higher demand for homes as more seniors are living longer. Also, there is an increasing amount of young adults seeking higher education. Many Millennials who were once hesitant to buy homes because of student loan debt or who wanted career location flexibility are now entering the market in their late twenties and early thirties and as a result are more financially established than traditional first-time homebuyers.

Despite stricter lending regulation since the housing bubble burst, there is an easing of policies with more flexible guidelines, especially regarding down payment and credit score. Even though almost a decade has passed since the Great Recession, many first time and experienced homebuyers still hold these preconceived notions about the immediate Post-Recession lending standards as truth.

According to the latest Elle Mae survey, 45% of renters believe that they have not saved enough money for the down payment. The National Association of Realtors (NAR) polled Millennials between the ages of 18-34. Only13% of this group know that it is possible to buy a home with 5% down or less. Researchers at Fannie Mae and Cal State Fullerton conclude that it is more efficient strategy to correct consumer misconceptions by engaging households who are qualified to own homes but do not realize that they are qualify. Call us to find out more about how you can put 3.5% down for a loan amount up to $636,100, 10% down for a loan amount up to $1.4M, or 15% for a loan amount up to $1.7M to buy your dream home.

Our team at CenTek knows and lives the real estate market, both within the context of the US as a whole and also within our microcosm of Southern California. We follow trends and policy changes in the lending arenas to help our clients prevail with their offer. Unlike direct lenders who only represent the bank, we work with a variety of wholesale banks and specialized lending institutions to package the loan to highlight strengths and minimize any issues.

CenTek Millennial Solutions is our newest program that specializes in helping first-time homebuyers succeed. Although some Millennials may not have the funds necessary for a full down payment by themselves, there are many other creative options for friends or family to help their millennial prevail with their offer. New credit formulas, such as the concept of the Non Occupant Co-Borrower and higher DTI Ratios, are helping some. In July, Fannie Mae relaxed the DTI Ratio from 45% to 50%, making it easier for those with college loan debt to obtain loans. Relatives can also gift portions of the down payment to buyers. We follow changes in underwriting guidelines and how to utilize these concepts to help young people become first-time homeowners.

By combining our decades worth of technical expertise with our knowledge of lenders’ current policies, we prepare our clients to compete with multiple bid properties, including all cash offers. Pre-approval and approval letters are taking on a new dimension and gaining importance because they indicate that the buyer does not have an issue in obtaining a loan. Contact us today to strategize a game plan for you or your clients. We can issue a detailed up-front loan approval so the buyer is prepared to waive loan contingencies with an offer, when appropriate, to make your offer look as attractive as possible.

Stay Tuned!

Gloria Shulman, Curtis Cohen, and the rest of us at CenTek

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Let’s get it done agents!

We blinked and poof… Another summer is coming to an end. Luckily, living in Southern California means that we get to enjoy summer much longer compared to the rest of the Country. We’ve had a busy summer here at CenTek developing two new programs CenTek Keys to Closing Deals and CenTek Millennial Solutions. As you know, you can count on us at CenTek to run “what-if” scenarios with you or your clients Monday- Friday from 7 AM- 7 PM. We are also available to return calls over the weekend.

Contact us today and we will work with you and your client to fine-tune a game plan. CenTek works together with you and your client as a team throughout the financial process, providing input when requested. We have many strategies where we can help you and your clients strengthen an offer to its fullest potential.

Our team maintains long standing relationships with a vast network of funding sources to gain unparalleled access to the most aggressive real estate financing options and solutions on the market. We utilize our technical knowledge and our decades worth of professional connections to help you and your clients prevail with an offer and close the deal.

Careful preparation and presentation of documentation are some of our CenTek Keys to Closing Deals. In this program, we can issue a detailed up-front loan approval so your clients are prepared to waive loan contingencies with their offer, when appropriate. If needed, we will also work closely with your client to help them raise their credit score. We have a very sophisticated computer modeling program that is very effective.

Another important aspect of this program is regarding the appraisal contingency addressed in your client’s offer. As we all know, appraisal contingencies can sometimes be unrealistically subjective based on the appraiser inspecting the property. Both selling and listing agents should be aware of any comparables the appraiser would have access to. We have noticed that it is very important to be familiar with comparables, especially if they could impact the appraised value of your client’s purchase.

CenTek Millennial Solutions is our newest program that specializes in helping first-time homebuyers succeed. Because of the high demand for homes, multiple bids on a single home are becoming the norm. Despite the fact that some Millennials may not be able to make a down payment by themselves, there are many other creative options for parents, grandparents, or other relatives to help their millennial prevail with their offer. We encourage you to follow us on LinkedIn for CenTek Millennial Solutions weekly blog post updates.

Feel free to pass any of this information along. Stay Tuned for more!

Gloria Shulman, Curtis Cohen, and all of us at CenTek

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Why own a home?

By: Shoshana R. Cohen

Simply put, owning a home is a guaranteed roof over your head. Historically, homeownership has been used as a vehicle to create long-term wealth because national home values tend to appreciate at a rate of 3.5% per year. Please note that this rate is extremely regional and in Southern California an 6.3% increase is more typical. Additionally, there are also instances which the cost of ownership can be less than renting.

By owning your own home, you can also experience personal freedom by being able to redecorate, remodel, or make improvements as they see fit. There are fewer rules that you must abide by, including restrictions on pets, children, or noise levels.

More importantly, buying a home and taking out a mortgage creates leverage, which can be a tool for wealth accumulation. Homeownership is also another way for you to diversify your investments. Portfolio diversification to any portfolio is crucial, regardless of how much money you have in the market. Do not get swayed by other “investments”, such as jewelry or artwork, as these items are extremely subjective and it is highly unusual to make money off of them.

Reason #1: Wealth Accumulation

There is no debt-rich quick scheme. Therefore, you may want to buy a property that fits your needs and economic goals. Homes are unique investments because they usually appreciate over the course of time, as opposed to other investments that immediately depreciate like cars. Yes, we did have a significant economic downturn in the 2008. However, a key to accumulating long-term wealth through a home is the idea that you should hold onto the property. As you pay your monthly mortgage payments, you build equity in your home. This is a form of “forced savings”, which can be important when you pay down the balance by a substantial amount.

Reason #2: Tax advantages based on current federal tax laws

There are also tax advantages associated with buying a home taking out a mortgage. Property taxes can be itemized for tax deductions from your federal tax and some state taxes. A mortgage payment is composed of both principal and interest, where the interest is tax deductible up to $1 M mortgage debt and is dependent on the tax bracket you are in. Tax deductions are especially important in the beginning years of the mortgage when interest represents the bulk of each monthly mortgage payment.

Reason #3 Elimination of Landlord

When you rent a home, you do not own any tangible property and you are also subject to your landlord increasing your rent or selling to another owner who then wants occupancy. While landlords can raise monthly rent payments by a certain percentage each year, mortgage payments can be locked in. However, as a new homeowner, you must be aware of the responsibilities that come with homeownership, such as an increase in utility bills and in maintenance obligations. You should not jeopardize their major source of income when performing upkeep. It is important for new homeowners to strike a balance between sweat equity and outsourcing their homeownership responsibilities.

If you are a First-Time or Experienced Homebuyer, feel free to contact CenTek Capital Group at 310–275–3202 to take advantage of any of our gratis mortgage services. We are available on M-F from 7:00 AM- 7:00 PM to run what-if scenarios. We also return calls on the weekends.

We know that breaking into the housing market alone can be rigorous and time-consuming. With 30+ years of experience, CenTek Capital Group has funded every type of loan, issuing a detailed up-front loan approval for many programs and closing purchase transactions in about 25 days. CenTek acts as your partner throughout the financial process, guiding our clients through mortgages and more. Our team maintains long standing relationships with a vast network of funding sources to gain unparalleled access to the most aggressive real estate financing options and solutions on the market. Ultimately, we utilize our technical knowledge in conjunction with our decades worth of professional connections to help clients and their agents prevail with their offer and close the deal.

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3 Ways Parents, Grandparents, or Other Family Members can Help Millennials Prepare for Homeownership

By: Shoshana R. Cohen

The overall U.S. population is expected to expand from 319 million in the year 2014 to approximately 360 million by 2030. Both healthcare improvements and expansions in higher education have impacted the housing market. There is a higher demand for homes as more seniors are living longer and there is also an increasing amount of young adults seeking higher education. Many millennials who were once hesitant to buy homes because of student loan debt or who wanted career location flexibility are now entering the market in their late twenties and early thirties more financially established than traditional first-time homebuyers.

Because of the high demand for homes, multiple bids on a single home are becoming the norm. Thus, to succeed in today’s aggressive market, it is imperative that both first-time and experienced homebuyers, are prepared to present an offer with minimal or no contingencies as soon as possible. Despite the fact that some Millennials may not be able to make a down payment by themselves, there are many other creative options for parents, grandparents, or other relatives to help their millennial prevail with their offer.

Option #1: Work with your Millennial to maximize their credit score to its fullest potential

One’s credit score is both multi-layered and very subjective based upon one’s spending and payment history. With proper support, there are many strategies for helping your Millennial repositioning their credit score. Firstly, it is not unusual for parents to affect their child’s credit score, if the child is still listed on the account. While these outstanding debts might not impact the parent’s credit score, they have more weight on the child, as their credit history is usually shorter.

Additionally, if your Millennial does not regularly use credit cards, encourage them to get cards and establish an active history. Department store credit cards and gas station credit cards are readily available. Make sure to activate them and do not pay them until the first bill comes in.

Option #2: Include yourself in the mortgage as Non-Occupant Co-Borrower

The non-occupant co-borrower status is another opportunity in which parents and grandparents can help their Millennial. This is a situation when a non-occupant, such as a parent or grandparent, can use their income to help the borrower qualify for loan. There is no proportion needed to qualify. In this scenario, the financial strength ratios of both borrowers are blended to help the borrower qualify.

In this case, the Non-Occupant Co-Borrower’s obligations are countered with the Millennial’s checks and the co-borrower’s credit is not impaired. It is important for the Millennial to show taxes, even if they are at a college-part time job, and have some credit.

Option #3: Gifting Money

Not all families have the ability to give their Millennial a contribution. A gift is defined as something that is not to be repaid. With some programs, mortgage brokers can structure a payment plan into loans.

Consider making a financial arrangement from the approach of a business standpoint. Specifically, a family member might want to share in the eventual appreciation of the real estate as an investment concept. This is a tremendous avenue to explore as long the down payment is clearly documented. This could be a good way for parents or grandparents to help their Millennial who is early on their career path. Although gifts are not made to be repaid, Millennials may take it upon to themselves to help out their family members as their career develops.

If you are a Millennial First-Time Homebuyer or a parent, grandparent, or other relative looking to help their Millennial buy a home, feel free to contact CenTek Capital Group at 310–275–3202 to take advantage of any of our gratis mortgage services. We are available on M-F from 7:00 AM- 7:00 PM to run what-if scenarios. We also return calls on the weekends.

We know that breaking into the housing market alone can be rigorous and time-consuming for young professionals. With 30+ years of experience, CenTek Capital Group has funded every type of loan, issuing a detailed up-front loan approval for many programs and closing purchase transactions in about 25 days. CenTek acts as your partner throughout the financial process, guiding our millennial clients through mortgages and more. Our team maintains long standing relationships with a vast network of funding sources to gain unparalleled access to the most aggressive real estate financing options and solutions on the market. Ultimately, we utilize our technical knowledge in conjunction with our decades worth of professional connections to help clients and their agents prevail with their offer and close the deal.

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August Market Update

Hard to imagine, but summer is starting to wind down. We are hopeful that everyone is enjoying the warm summer days and cool summer nights that Los Angeles provides all of us. Might we add, Los Angeles is perhaps the best overall city in the world!! Speaking of the world, pretty scary place right now. The on-going rhetoric battle between the United States and North Korea is needless to say a little unnerving. Hopeful that cooler heads prevail and a dialogue that leads to a more muted outcome occurs. Needless to say, the alternative is not a good one…..Difficult to fathom that humanity hasn’t evolved from this type of behavior..This geopolitical tension has kept rates at very attractive levels.

Our recommendation as it relates to the mortgage arena is to allow Centek to evaluate your existing mortgage profile and analyze if any alternative programs would be better suited for your overall financial strategy – reducing the amortization of your current loan, changing from an adjustable rate mortgage to a fixed rate or conversely changing from a fixed rate mortgage to an adjustable rate program. Mortgage rates have dipped below 4% and if rates continue down this path, our steadfast philosophy is to have your loan package in and ready to go in order to best take advantage of a further rate decline. If we start the process further down the line, we might not be able to catch the window of opportunity. Another segment of the financing arena which we are seeing more and more issue with is the student loan situation. Many of our younger clients are having difficulty with qualifying for their first home loan because of the student debt load. Our suggestion to many clients hast been, if possible, to assist with their children’s home purchase by either co-signing on the loan for them or refinancing their home’s in order to pull out cash to pay off the student loans. These are difficult decisions for all parties on a multitude of fronts, but certainly worth considering.

In regard to the real estate market, we feel the most prevalent issue is with the lack of inventory for sale. The lack of inventory is due to several interrelated factors that we have not recently experienced. The escalation of property prices in our California market (especially our SoCal & Bay areas),the vibrant California economy & the increases in the stock market. The combination of these and other factors including the demand from foreign investors, has limited the number of available properties on the market. The flip side to this equation is where is the seller of the property going to move? This point is a large reason as to why more properties are not for sale. Where does one move when they sell their home? This is a problem and a main reason why with elevated home values more properties are not on the market. The move up buyer is difficulty in selling their existing house and being able to afford the next level up in price….This by no means applies to everyone, but is a major point in the overall real estate market place.

Please feel free to contact us at 310 275 3202 to discuss your financing or overall real estate acquisition or sales needs. We can review and strategize with you. Stay tuned!!

Best Regards,

Gloria Shulman & Curtis Cohen

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4 Myths about Mortgages for Millennials

By: Shoshana R. Cohen

MYTH #1: It is very difficult for Millennials to become homeowners

FACT: Despite the fact that Millennials face many hurdles, such as student loan debt, underemployment, and high rental prices, many creative finance structuring options exist. Today, it is possible to close a loan for up to $636,100 with only 3.5% down payment, which is a manageable course of action. As with any financing, reserves are required. However, they are not pledged in any way.

MYTH #2: My branch at (insert personal bank here) offers loans. I should go there.

FACT: Unlike direct lenders who only represent the bank, brokers work with a variety of wholesale banks and specialized lending institutions. Make sure to prepare your paperwork in advance. This cannot be stressed enough as there are many variable layers in the homebuying procedure. If any bank deposits are out of the ordinary, provide that information too. Mortgage brokers know what questions to ask and work with you to fill in gaps. Their technical experience allows them to package the loan to highlight your strengths and minimize any issues.

MYTH #3: I don’t need to start working on my mortgage until I find a house I want to make an offer on.

FACT: In order to prevail in today’s aggressive market, it is imperative that homebuyers are prepared to present an offer with minimal contingencies as soon as possible. A pre-approval letter makes a prospective buyer seem more attractive because it shows that the buyer does not have an issue in obtaining a loan. You should arm yourself with a pre-approval letter customized to your needs, which can subsequently be tweaked later in the process depending on the home’s selling price. Pre-approval and approval letters are taking on a new dimension, as well-regarded pre-approval letters are even able to compete with all cash offers.

MYTH #4: It is hard to improve my credit score

FACT: With proper support, there are many strategies for repositioning your credit score, which is subjective based upon your spending and payment history. Mortgage brokers run the 3 Bureau Credit Report, which better reflects your credit score than any report you can run online. With this scoring system, brokers can do an analysis of credit cards that can be strategically paid down to certain amounts to pump up your overall credit score. Additionally, it is not unusual for trivial things, such as minor medical collections, to impact the credit score.

If you are a Millennial First-Time Homebuyer, feel free to contact CenTek Capital Group at 310-275-3202 to take advantage of any of our gratis mortgage services. We are available on M-F from 7:00 AM- 7:00 PM to run what-if scenarios. We also return calls on the weekends.

We know that breaking into the housing market alone can be rigorous and time-consuming for young professionals. With 30+ years of experience, CenTek Capital Group has funded every type of loan, issuing a detailed up-front loan approval for many programs and closing purchase transactions in about 25 days. CenTek acts as your partner throughout the financial process, guiding our millennial clients through mortgages and more. Our team maintains long standing relationships with a vast network of funding sources to gain unparalleled access to the most aggressive real estate financing options and solutions on the market. Ultimately, we utilize our technical knowledge in conjunction with our decades worth of professional connections to help clients and their agents prevail with their offer and close the deal.

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July Market Update

    Summer is upon us with all that it has to offer! Most of us would rather be experiencing summer activities rather then the reality of dealing with health, work, money , family etc.. That being said, the stock market continues to churn higher to record levels along with real estate values. Interest rates seem to have found a middle ground waiting for the Federal Reserve decision….What appears to be the driving force with the direction of rates is coming from Germany. Their rates have risen quite a bit and now seem to be leading the interest rate complex to higher levels. We will see what our Federal Reserve Board determines soon.

Our recommendation as it relates to the mortgage arena, is to allow Centek to evaluate your existing mortgage profile and analyze any programs that might be better suited for one’s overall financial strategy – reducing the amortization of one’s current loan, changing from an adjustable rate mortgage to a fixed rate or conversely changing from a fixed rate mortgage to an adjustable rate program. Mortgage rates have dipped below 4% and if rates continue down this path, our steadfast philosophy is to have one’s loan package in and ready to go in order to best take advantage of any further rate decline. If we start the process further down the line, we might not be able to catch the window of opportunity. Another segment of the financing arena which we are experiencing more and more issues with, is the student loan situation. Many of our younger clients are having difficulty qualifying for their first home loan because of the student debt load (even if deferred). Our suggestion to many clients is, if possible, to assist with their children’s home purchase by either co-signing on the loan for them or refinancing their home’s in order to pull out cash to pay off the student loans. These are difficult decisions for all parties on a multitude of fronts, but certainly worth considering.

In regard to the real estate market, we feel the most prevalent issue is with the lack of inventory for sale. This lack of inventory is due to several interrelated factors that we have not experienced in the recent past. The escalation of property prices in our California market (especially our So Cal & Bay areas),the vibrant California economy & the increases in the stock market in addition to the inherited wealth effect. The combination of these and other factors including the demand from foreign investors, has limited the number of available properties on the market. The flip side to this equation is where is the seller of the property is going to move to? This concept is a major reason as to why more properties are not for sale. Where does one move when they sell their home? This is a problem and a major reason why with elevated home values, more properties are not on the market. Many move up buyers have constraints in selling their existing house and being able to afford the next level up in price….This by no means applies to everyone, but is a major point in the overall real estate market place.

 

Please feel free to contact us to discuss your financing or overall real estate acquisition or sales needs. We can review and strategize with you. Stay tuned!

Best Regards,
Gloria Shulman & Curtis Cohen