Home Refinance

Expiring HOA Insurance Loan Threat Resolved


A buyer’s loan for a condominium property was in jeopardy because of difficulties with their HOA (Home Owner’s Association) insurance. The renewal of their HOA master insurance, the required fire insurance that replaces the complex in case of fire, had been denied. Every lender requires a valid master insurance policy in place that doesn’t expire for at least three to six months from the time escrow closes on the purchase.

The existing policy had been extended from its original expiration date to two weeks after my buyer’s purchase was supposed to close. But the lender was requiring a policy that was good for at least three months after closing. The HOA had waited until the last possible day before settling on a new insurer and policy, which meant I had to extend the loan transaction beyond our original closing date by over two weeks.

We had locked the interest rate when the loan was originally in contract and I had locked it with a one-week cushion, just in case something unforeseen came up that would cause the transaction to not close on time. I typically do this as long as it doesn’t impact the cost to close for the borrower. But in this case, we needed two more weeks, requiring us to extend the lock beyond its original expiration date.

At the time of the lock, interest rates were down from where they were when I needed to extend the lock. In this situation, the lender will usually require the borrower to pay an additional fee in points to extend the rate lock period. This issue was not my borrower’s fault so I worked with the lender to get the lock extended for one week for free, based on my relationship with the lender. Then I worked on negotiating with the seller’s agent to have the seller pay for an additional five days of the lock extension since this was an issue with his property and the HOA. I was able to get the seller’s agent and the buyer’s agent to split the cost to extend for the remaining three days or so with me and we all split the final cost to extend the lock between the three of us.

Another complication was that we had removed our loan contingency prior to learning of the insurance issue with the HOA. But I was able to work with the seller’s agent to get her to work with the HOA to help them find a new insurer and to allow us to extend the escrow period with no consequences for my buyer.

At the end of the day, everyone was happy! My buyer not only got to close on her new property but also didn’t incur any additional costs due to having to extend the escrow period and the rate lock. And she kept her interest rate in a rising rate environment along with the original terms I had negotiated on her behalf at the very beginning of the transaction.

Refinance Equity Buys Second Home


An immigrant couple who both work in low-income jobs came to me for help buying a second home. Both of the borrowers work in the restaurant/food service industry, and their hours and income were somewhat variable. Only one of them had a social security number, so we could only use one of the borrower’s names on the loan application.

They owned a single family residence property in San Francisco that they purchased years ago and were occupying as their primary residence. The property had appreciated nicely over the years and I helped them take cash out to put them in position to purchase another primary residence outside of the Bay Area. This allowed them to rent out the San Francisco property and move to a more affordable part of the country. The rent on the San Francisco property was enough to create positive cash flow for them on that property and the $100K cash they took out on the equity of that property allowed them to move to Texas and buy a new home for cash.

The borrower without a social security number has since gotten his green card and has a social security number now.  I am working with them to purchase another home in Texas where they are making the same income as in San Francisco but where the cost of housing is dramatically less. They will rent out the home they purchased in Texas for cash and it will also create a nice cash flow vehicle for them. They can now qualify for a purchase of a home in Texas that is twice the cost of the one they currently own, because we can use the second borrower’s income now and they own two properties that cash flow positive.

Part of the way I am able to get the income from their jobs to work for qualifying purposes is that I have been working with their employers to get formal, written verifications of employment that explicitly state that both borrowers are full-time employees despite their slightly variable hours showing on their paystubs, and I don’t submit their paystubs to the lender.

Refinance Resolves Balloon Payment Threat


A retail store owner who is also a homeowner in Kensington, came to me looking to refinance. His home loan had a balloon payment that was coming due. The stakes were high: he needed to refinance soon or he could potentially lose his home. The current lender was poised to repossess.

His tax returns did not show the net income required to qualify for a conventional loan.

Using a CPA-certified profit-and-loss statement for the last two years, I was able to get him refinanced into a more stable loan at a lower interest rate. Thus, this business owner, and his wife and kids, were able to keep their beloved family home.

Refinance for Home Expansion


A family of four had outgrown their current residence and were looking for a cash out loan to add on to their existing property. They also hoped to build out a large deck in the backyard for barbecues.

With my extensive network of real estate industry colleagues, I was able to help the homeowner procure an appraisal showing enough equity in the property in its current condition for the borrower to take enough cash to create his new dream house for his family.

He turned a 2 bedroom/1 bath into a 3 bedroom/2 bath in Castro Valley, and yes, they are now enjoying that deck.

Refinance Pays Off Debt


A homeowner with a family of four came to me sinking in credit card debt, and concerned that he might lose his house in Pleasanton.

Due to his high credit card balances, his credit score was very low, at 640.

I was able to help him refinance his debts by tapping increased property values in the current market.

We rolled his balances into a new increased mortgage using an FHA loan (Federal Housing Administration) — saving him $2100/month, making it possible for him to keep his home that he had been living in with his family for the past 12 years.

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