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May 2nd Market Update

Hard to believe we are already knocking at the doorstep of summer. …Difficult to tell if life has just sped up with all of the technological advances or are we just getting older!!! The Federal Reserve announced today that they are leaving interest rates unchanged for the time being, but that the outlook remains that the economy is doing well and that inflation has ticked up enough to warrant more aggressive Fed policy at upcoming meetings. Remains to be seen, how many additional rate increases will occur for the balance of the year. General consensus is another two increases with a possibility of three. How does this translate to the overall mortgage interest rate environment? Difficult for mortgage rates not increase in lock step with these additional Fed rate increases. Even though rates remain at historical lower levels, we have all been spoiled with how low rates went. We all need to re-evaluate what higher rates mean to us individually and how this translates to the overall real estate market and economy. In addition, we need to incorporate the new tax laws into our mindset to further complicate matters. The net effect of new policies remains to be seen on how it relates to the real estate arena.

On a positive note, there are many exciting loan programs that have rolled out that allow us not to use tax returns or other traditional underwriting methodology. We need to move away from an interest rate driven financing market to one that is a “means to an end.” Needless to say, no one wants to pay a higher rate than is necessary, but sometimes we need to just get the deal done and accomplish our goal. There are still many traditional / standard lender’s we deal with that are extremely aggressive, but these banks are not for everyone…

The real estate market remains in good condition with properties listed at realistic prices, receiving multiple offers. Inventory remains tight, but an over looming question that needs to be answered is if one sells their house with a sizable gain, where do they move? The move up buyer is stuck between a rock and a hard place with higher interest costs and new tax limitations. Many of our clients have elected to scrap plans for purchasing a new home and instead opt for an extensive remodel of their existing house. We can assist with the cash out necessary for the remodel via a traditional refinance or we have construction loans available.

The demand for housing remains robust as Los Angeles continues to attract people from all over the globe. Who doesn’t want to live here!!!!

As always, please feel free to contact us with any what if scenarios or just to say hello!!

Best Regards,

Gloria Shulman and Curtis Cohen

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March 28 Market Update

Spring is here!! We are hopeful that everyone is about to enjoy the upcoming Passover and Easter holidays (for those who celebrate)!! Time for introspection and reflection on who and what we are and where we want to go….

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. We have included an analysis of when your mortgage adjusts from the fixed period to an adjustable rate as well as when an interest only mortgage converts to a principal and interest payment with a new amortization basis. The numbers are quite compelling to refinance into either a new ARM or changing to a fixed rate. In either of these instances, the rate/payment might increase, but better to have the stability of a new fixed rate for a defined period of time than be at the mercy of the global interest environment. The Libor index which most of the adjustable rate mortgages are linked to, has risen dramatically and as of today stands at 2.67%. When you add the margin of 2.5-3% to this, the new rates upon adjustment will be in the 5%+ range!! The past couple of days have seen mortgage rates drop to levels of early February. Our steadfast philosophy is to have your loan package in and ready to go in order to best take advantage of any rate decline or be prepared to “bite the bullet” and change out of an adjustable to a fixed rate or even a new adjustable rate to provide a longer fixed period even if this means increasing your current interest rate. The end result will alleviate all of the what if scenarios that could potentially play out..If we start the process further down the line, we might not be able to catch the window of opportunity.

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. 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. Another salient issue is with the new tax laws. The limiting of the interest mortgage deduction to $750,000 is a marginal issue. The canary in the coal mine is how the limitation on the deductibility of real estate taxes in conjunction with other state and local taxes , has an effect on real estate values…..

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

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February 19 Market Update

Feb 19, 2018

Mortgage rates have continued their upward march towards the 5% area. The move has come quite quickly and has created further questions as to how high rates can climb. However, we must keep rates in a historical perspective. Even at these “lofty” levels, rates are still extremely attractive from a historical standpoint and those of us who are old enough to remember, we really know what high rates look like!! Our philosophy is to analyze a borrower’s overall financial profile and recommend the mortgage that best suits the individual. In this marketplace, there is no such thing as one loan fits all! Many of our lending partners have developed programs (with our feedback) that only require bank statements or rental income for qualifying, not the traditional tax return methodology. Please ask to us to review all the various options available – fortunately, there are alternative options that exist, versus the heavy handedness of the last few years. Keep in mind, these rates won’t be the lowest, but our goal is to get you into the property or be able to pull the cash out that you need. There is a time and place for everything and sometimes a slightly higher mortgage rate is just a cost of doing business…..The key is being in the game instead of a spectator.

In regard to the real estate market, we feel the most prevalent issue is with the lack of inventory for sale. Multiple offers are the norm for well priced properties. Another issue that we need additional time to see how plays out, is the effect of the new tax laws and how this will alter, if at all, the mindset of buyers because of the tax deductibility of property taxes. We don’t feel that the mortgage component will have a material effect on whether or not someone purchases a home.

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 spiked above 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 any rate decline or be prepared to “bite the bullet” and change out of an adjustable to a fixed rate or even a new adjustable rate to provide a longer fixed period even if this means increasing your current interest rate. If we start the process further down the line, we might not be able to catch the window of opportunity.

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!!

Gloria Shulman & Curtis Cohen

Some of our unique programs to help you close your deal or have a smooth refi…

 
  • 3.5% – 5% down program up tp $679,650 loan amount
  • 10% down program up to $1.450M sales price
  • 15% down program up to $2M sales price. We can also go higher with larger downpayment.
  • With married couples, we are now able to utilize the highest credit score for qualifying purposes.
  • In divorce situations with alimony paid involved, we are able to treat the payment as a reduction to income vs. liability; this has a dramatic affect for the qualifying process, especially with higher alimony payments.
  • Fully blended ratios with borrower and co-borrower treated as 1 entity for loan qualifying. This translates to parents who want to buy for their children, with limited income, are now able to obtain owner occupied rates and terms. 
  • With some programs, we close with 1 year of tax returns and / or qualifying bank statements instead of the usual two. 
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January 31st Market Update

Hard to imagine, but winter is starting to wind down.   We are hopeful that everyone is enjoying the warm winter days and the refreshing winter nights that Los Angeles provides all of us!! No other place quite like southern California… Might we add, Los Angeles is perhaps the best overall city in the world!!

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 spiked above 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 any rate decline or be prepared to “bite the bullet” and change out of an adjustable to a fixed rate or even a new adjustable rate to provide a longer fixed period even if this means increasing your current interest rate. If we start the process further down the line, we might not be able to catch the window of opportunity.

The Federal Reserve announced no change in rates at today’s meeting.  The general consensus is that rates will continue to migrate up towards 3% on the 10 year treasury note.  What this means for mortgage rates is that moving in tandem with treasury yields,  rates will continue to increase as well.  The overall economy and the stock market in particular continue to be performing well.  One lens to view the increase in rates through is that one’s other assets and income are increasing and that the higher monthly payment is just a cost of doing business.

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.  In our next newsletter, we will discuss the effect of the new tax laws on how it pertains to financing options.

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

Some of our unique programs to help you close your deal or have a smooth refi…

 
  • 3.5% – 5% down program up tp $636,100 loan amount
  • 10% down program up to $1.450M sales price
  • 15% down program up to $2M sales price. We can also go higher with larger down payment.
  • With married couples, we are now able to utilize the highest credit score for qualifying purposes.
  • In divorce situations with alimony paid involved, we are able to treat the payment as a reduction to income vs. liability; this has a dramatic affect for the qualifying process, especially with higher alimony payments.
  • Fully blended ratios with borrower and co-borrower treated as 1 entity for loan qualifying. This translates to parents who want to buy for their children, with limited income, are now able to obtain owner occupied rates and terms. 
  • With some programs, we close with 1 year of tax returns and / or qualifying bank statements instead of the usual two. 
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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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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

michael No Comments

Happy New Year

First and foremost, a happy and healthy new year to everyone!!  Already seems like this is old news!!  Speaking of news, today’s  labor report was right down the middle of the road…not too hot, not too cold.   Since the election of Donald Trump, there has been a divergence between the stock and bond markets.  Equity prices have zoomed upward with the 20,000 Dow Jones Industrial Average in its sights, while the bond market has seen rates increase by over 60 basis points.  The equity markets have priced in to the equation a rosier economic picture with the combination of lower taxes and less regulation which will lead to better corporate earnings and the subsequent higher stock market.  The flip side has seen interest rates spike to levels not seen in the past few years because of the perceived notion that economic policy is changing from a monetary perspective to a fiscal one.  This in turn will create a landscape where the Federal Reserve will have less ability to shape policy and have to react more to the policies implemented by the new Trump administration.  What all of this means, remains to be seen…..
In regard to the mortgage arena, rates have risen dramatically over the past two months.  30 year fixed rate loans that were in the low to mid 3% range, have now risen to the low 4% area.  While trying to keep this in a 20-30 year perspective, rates are still historically low, but we all get spoiled and want the rates to stay well below any historic average.  The real estate market has stayed extremely buoyant and prices remain at elevated levels at all price points.  This can be said for the rental market as well.  Low inventory and the relative low mortgage rates are still the driving factor for this demand.  In addition, foreign investment remains strong.  On the commercial front, activity remains robust with many clients seeking to purchase properties for their own use versus paying rent to a landlord.
The mortgage market still has rigid underwriting guidelines, but we have a number of non-traditional loan options offered by a number of institutions that mirror prime/traditional pricing.  Some of the highlights are using only 1 year of tax returns versus the traditional 2 years, 12 month’s bank statements in lieu of tax returns & the use of liquid assets as a source of income.  All of these can make or break being able to obtain financing.  In addition, a number of our sources allow for recent short sales or foreclosures.  No need to wait four to seven years to purchase a new home.  Needless to say, we of course have a complete menu of traditional mortgage options, including interest only loans & a wide variety of investment property loan options.
We all look forward to a healthy & prosperous 2017 for each and every one of us!!  Please feel free to reach out to us to discuss any real estate situation.  We welcome your contact.
Warm regards,
Gloria Shulman and Curtis Cohen