- Both the California economy & real estate market are strong
- Despite the tightening standards since the Great Recession, there has been an easing of lending policies
- Our goal for 2018 is to position clients into a mode where they can compete against the multiple offers and all-cash buyers that dominate the market
By: Shoshana R. Cohen | Business Development Manager, CenTek Capital Group Published: 01/03/2018
Steady job growth, an expanding economy, and a limited inventory of available homes will continue to drive up median home prices into the foreseeable future. As housing prices continue to climb across the state, lenders tend to view these homes as safe and sound investments. Over the course of 2017, lenders have responded very positively to increases in mortgage applications. Below is a list of CenTek’s latest tips to help buyers close in this competitive market.
Tip #1- Tell us your financial story
Whether you are a first-time homebuyer, making a lateral or vertical move, beginning to live off a fixed retirement income, or looking to diversify his/her financial portfolio with a residential investment property, we want to hear your story. Our innovative approach blends together our technical expertise with the human awareness of real life’s twists, turns, ages, and stages.
We specialize in an array of customized loan products and have tremendous flexibility regarding loan-to-value, cash-out concepts, mixed-use properties, etc. Whether your deal is based off a traditional loan program, utilizing the non-occupant co-borrower concept, or takes advantage of documented gifts, there’s nothing we haven’t seen.
Tip # 2: Maximize your credit score
Despite stricter lending regulation since the housing bubble burst, there has recently been an easing of guidelines, especially with regards to credit score. One of our most popular strategies is to preemptively work with clients, even before they find their dream house. If necessary, our team will work with each client to maximize their credit and financial profile to their fullest potential.
With a release, we can instantly run the Three Bureau Credit Report for clients who are seeking a loan or refinance (no charge). If requested, our team will holistically analyze each client’s credit profile using an in-house computer modeling system. This program proposes the various ways in which an individual can strategically pay down liabilities and/ or credit cards to maximize his or her credit score.
* Considering the recent Equifax data breach, it is very important that those interested in various financing options to un-freeze their credit. *
Tip #3- 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 in almost every neighborhood in California.
In the 2018 real estate market, we encourage potential buyers to expand their search zone. Many neighborhoods on the periphery of your initial search zone are on the up and up due to thin inventory.
Tip #4: Utilize pre-approval & approval letters
We underwrite as one of the leading wholesalers of loans in the country and are experts in delivering packages that meet our clients’ needs. Once we are familiar with each client’s information, our in-house underwriters can write detailed pre-approval and approval letters customized towards the client’s financial profile and their desired property’s specifications. We can continuously update and customize these letters towards different offers as the search continues.
As we move into 2018, pre-approval and approval letters have shifted into a new dimension. Their weight is gaining more traction and our highly-regarded letters can oftentimes close against multiple bids and/or all-cash buyers. Many real estate agents across the state recognize our letters and know we can close per-escrow terms.
Tip #5: Research comparables in the area
It is very important that you are familiar with comparables, particularly if they could impact the appraised value of your purchase. Selling and listing agents, in addition to sellers and buyers, should be aware of any comparables the appraiser would have access to. As we all know, an appraisal can sometimes be unrealistically subjective based on the appraiser inspecting the property. The agents should document in writing various comparables in your submarket, in terms of region, price point, and overall design.
Compare and contrast the property with other properties in the area. Identify the similarities between your property and others around it. Recognize what sets your property apart from others, whether it be home improvements, extra bathrooms, or outdoor amenities. Even streets in the same neighborhood can be valued differently. Research recent transactions in the neighborhood. It is imperative that you are aware of neighborhood trends, in addition to all uncharacteristic sales (E.g.- sales between family members with different last names, short-sales, or all-cash offers that close for a lesser amount).