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Posted by Kemmer Daniel Matteson on November 16th, 2017 8:40 AMLeave a Comment

April 8th, 2015 7:07 AM



The answer to that depends on how much less you’re pre-approved for. If the home is truly out of your price range, you really should move on and look for a home that you can afford. However, if the difference between the seller’s asking price and what you’re approved for is a small amount, there are several possible ways to close that gap, including:

• Working with your lender to increase the amount you’re approved for.

• Putting down a larger down payment.

• Negotiating with the seller to lower the price.

Before you do anything else, though, you should talk to your broker. Although it may not always be feasible, some borrowers are able to get approved for a larger amount, especially if the difference between the pre-approval and the asking price is minimal. A pre-approval is not necessarily set in stone, so definitely touch base with your broker. Also, make sure you bring your real estate agent into the loop so that they’re aware of the situation.

Posted by Kemmer Daniel Matteson on April 8th, 2015 7:07 AMLeave a Comment


Your credit score is the number one thing that lenders look at, right? Not according to a survey conducted for credit-scoring company FICO. Nearly 60 percent of credit-risk managers surveyed said that a borrower’s debt-to-income (DTI) ratio is the biggest factor that would make them hesitant to approve a mortgage. A low credit score actually comes in third on the list, behind applicants who have submitted multiple credit applications recently.

In simple terms, your debt-to-income ratio is the percentage of your monthly gross income that goes toward paying all of your debts and liabilities, which includes your mortgage, credit card debt, student loans and other housing expenses. Your DTI ratio is broken down into two parts: front-end ratio and back-end ratio. With a few calculations, you can calculate your own DTI ratio and take steps to improve it.

Your front-end ratio is the percentage of your gross monthly income that goes toward your monthly housing payment. To calculate your front-end DTI ratio, divide your monthly housing payment (principal, interest, insurance, taxes, etc.) by your pre-tax monthly income. As a general guideline, you’ll want your monthly housing payment to be less than 28 percent of your gross monthly income. If it’s higher, that may be a red flag if you’re applying for a mortgage, although there is some flexibility in some cases.

The second part—your back-end ratio—measures your gross monthly income against all of your recurring monthly debts and liabilities and is generally considered the more important component of your overall DTI ratio. To calculate your back-end ratio, divide your total monthly credit card debt, student or personal loans, housing expenses, etc. by your pre-tax monthly income. Under the new Qualified Mortgage rules passed by the Consumer Finance Protection Bureau in 2014, most mortgages require a back-end ratio of 43 percent or less, although some Fannie Mae and Freddie Mac loans do allow for a higher debt-to-income ratio if the applicant has strong credit. Generally, a back-end ratio of 36 percent or less is considered a good goal if you’re looking to get a new mortgage.

If your back-end ratio exceeds the targeted percentage, there are ways to fix it. The most direct way to improve your ratio is to start paying down your recurring debt, such as the monthly balances on your credit cards. Paying down debt is usually much easier and more feasible than taking the reverse route of increasing your monthly income.

If you’re considering buying a home or refinancing in the near future, you’ll need to start working on your DTI ratio as soon as possible.

Posted by Kemmer Daniel Matteson on April 8th, 2015 7:05 AMLeave a Comment

April 8th, 2015 7:03 AM


If you’re looking to get a mortgage in California when you relocate to take a new job, it may not be as difficult as you think. Here is what you need to know when you are relocating for your job and you want to buy a home in California, the must knows about how to get the right mortgage loan in California.

Even though you may be between jobs (at least technically), these situations are fairly common. If you can understand the situation from the point of view of your lender and know what your options are, you should be able to get the mortgage—and the home—that you want.

Lenders will look at three aspects of your income: history, amount and stability. That may seem like two strikes against you—with only income history going for you—but just because you’re getting a new job doesn’t mean that you’ve suddenly become a lending risk. If your new job is in the same industry and the pay is equal to or greater than that of your prior job, many lenders will consider that as a sort of continuation of your old job. Also, keep in mind that there are other factors—such as your credit score and debt-to-income ratio—that a lender will consider besides income.

In most cases, you’ll have several different options in terms of getting a mortgage when you relocate. A lender may want proof of at least 30 days of employment at your new job, so closing on a new home immediately may be tricky, but there may be ways to get around this. For example, if you have an offer letter—or, better yet, an employment contract—a lender may approve your loan as long as your start date is before the date you close on your new home. If that’s not feasible, most lenders offer loan products that are specifically geared to these situations.

The bottom line is this: Lenders deal with people relocating for a new job on a regular basis and they will certainly do their very best to get you into your new home.

Whether you have been mulling over the idea of buying your first home in California or fifteenth home, it may be a very wise financial decision to finally pull the trigger on buying a new home in California this year.

Here are five reasons why:

1. Having a mortgage loan can be less expensive than paying rent. Rental rates have been climbing and the latest numbers show a 6.1 percent year-over-year increase. In many areas, the average monthly rent is higher than the average monthly mortgage. Or, look at it this way: Making a mortgage payment is an investment into your equity, whereas making a rental payment is not.

2. California Home prices are still reasonable in most areas. As we mentioned, home prices are rising in many areas, but not as fast as they were two years ago or even last year, when prices rose slightly above 4.0 percent nationally. Although all real estate markets are different, prices in many cities and markets are significantly lower than they were at the peak of the housing boom back in 2006.

3. Interest rates are low for all types of mortgages. Whether you’re looking for a 30-year fixed-rate, a 15-year fixed-rate, a jumbo loan, or an adjustable rate mortgage, the interest rates are definitely in your favor right now. Currently, the rates are at the lowest levels they’ve been since May of 2013. Along with home prices, this is an area in which you can save quite a bit of money.

4. Getting a mortgage loan with a down payment of 3 percent just got easier.Although there are some restrictions, you can now get a mortgage backed by Fannie Mae or Freddie Mac that has a down payment requirement as low as 3.0 percent (Fannie began backing such loans in December and Freddie will begin on March 23). You now have two more options to go along with the other low down payment loans.

5. Buying a California home is a good investment—especially as a long-term investment.Real estate is one of the best investments. Yes, the housing market is cyclical and there are plenty of ups and downs, but right now we’re seeing an upswing in many markets and this is a good time to be a buyer. In the long term, real estate is an especially good investment—as long as you’re willing to ride out any declines in prices and values.

It’s important to remember that real estate is always in flux and market conditions can change very quickly—especially home prices and interest rates—so don’t wait to buy if you’re ready.

Posted by Kemmer Daniel Matteson on March 31st, 2015 9:59 PMLeave a Comment

March 31st, 2015 1:05 PM
The most attractive aspect of a loan backed by the Federal Housing Administration (FHA) is the low down payment requirement. If you qualify for an FHA loan, that could mean a down payment as low as 3.5 percent. Also, interest rates on FHA loans are the lowest they’ve been in almost two years.

The bad news is this: FHA loans do require mortgage insurance premiums (MIP), which can be quite costly. However, there is also good news: The FHA just lowered the monthly mortgage insurance requirement by one half of one percentage point. This could mean hundreds of dollars of savings each month.

For the past several years, the FHA—which insures roughly 20 percent of all mortgages—had imposed costly mortgage insurance premiums on borrowers in order to fund its cash reserves. As recently as last year, the FHA needed a cash infusion from the U.S. Treasury, but improved loan performance and rising home values increased its capital reserve balance by the end of 2014. In turn, the FHA decided that it would lower its MIP requirements by 0.5 percentage points—from 1.35 percent to only 0.85 percent for a 30-year loan with a loan-to-value ratio of 95 percent or more.

What could this mean for you? Like we said, the monthly savings could run in the hundreds of dollars. Although upfront mortgage insurance required on FHA loans remains unchanged, the monthly cost—which is the one that really matters—has been significantly reduced for FHA loans of $625,000 or less.

FHA loans have become more popular lately and these loans have helped many people buy over the last five years. Although not every borrower qualifies for an FHA-backed loan—and it may not be the right loan for many borrowers—if you do qualify, this new lower MIP is definitely good news

Posted by Kemmer Daniel Matteson on March 31st, 2015 1:05 PMLeave a Comment

January 22nd, 2015 4:27 PM

California mortgage rates hit new lows today. First California Financial specializes in only California clients and our rates are the lowest in almost two years since the spike up. This will not last as the stock market volatility will settle down and fund will pull out of mortgage market and rates will go up.

With the Federal government poised to increase rates new spring NOW is the time to get out of your adjustable rate mortgages and lock into a fixed rate.  Go to our website and see the rate graph for 1 year and two year California rates.  Then go to our free rate quote for custom pricing.

We will probably never see California rates this low again this is your opportunity to lock into a great deal. Get out of that adjustable rate loan or combine you first and second into a new single fixed rate loan.

Posted by Kemmer Daniel Matteson on January 22nd, 2015 4:27 PMLeave a Comment

November 17th, 2014 2:04 PM

The Federal Banking reserve chairman ended the quantitative easing program, which had the government buying Trillions of bonds. This was to create a large demand to keep prices down. California mortgage rates are now on the rise and will continue to rise.

If you are looking to refinance your home loan in California now is the time to see what you qualify for and what mortgage refinance programs are available to you as a homeowner in California.

So with the demand now diminished, prices will go up so in other words mortgage interest rates will rise up as they are closely associated with bonds. While the federal reserve rate remaining at historical lows, as the economy grows they will have to raise the rates and mortgage rates will again rise, especially the adjustable rates tied to those rates/indexes.

It is important if you are going to remain in your home and have an adjustable rate mortgage to know what the consequences of holding on the the low rate you have.

What is your index and Margin is the first question you should know. Libor and monthly index's are the first to go up and have the highest margins or higher rates. What is the maximum your capped out rate you can go to? This is the highest rate you mortgage can go to and what is the maximum it can go up per year. Many of these adjustable loans can go up 2% a year and you could find yourself having a much higher payment in a short time.

It is always difficult to trade up to a fixed rate.. If adjustable rate mortgages had the same rates as fixed no one would take them!
So locking in a fixed rate is going to be at a higher rate than the variable rate loan.

So the decision has to be made with the time frame of ownership you have to stay in the home. It is always better to convert to a fixed when the fixed rates are lower obviously than higher.

With the certainty of rates going up and fixed rates still at very low levels this is the time to convert to a fixed, if you are keeping your home. 

Many companies try to sell you on no cost loans at higher rates, but it is possible to buy down the interest rate and thus the payment to keep your new payment closed to what you are currently budgeted.

Give me a call and I can work out several scenarios. /options that will give you peace of mind and continual affordable ownership. 

Posted by Kemmer Daniel Matteson on November 17th, 2014 2:04 PMLeave a Comment

October 21st, 2014 4:51 PM

California Mortgage Market

California Mortgage loans today are sold on the secondary market and have prices like stocks. There is a price for a 30 year, 15 year, and adjustable rate mortgages in California. If you own a home in California and you are looking to refinance your home or if you are looking to buy a home now is the time to see what California home loan programs you have available to you and find out what interest rate you qualify for with refinancing or purchasing a home in California.

So really everyone has the same rates. So for example if you wanted to buy apple stock at $100 , I don't care how many companies you call the price is the price. Just like stocks you are going to pay a transaction fee (closing costs) and that can vary from company to company. If you used an online stock company you can save money over using a full service stock broker as their overhead is less as they do things electronically.

Much the same in the mortgage market, Banks with many office locations conviently located for you to go to cost money and with a fixed market prince for mortgages they have to increase there rates or fees to cover the costs.

We are an on-line, paperless California mortgage brokerage with the latest technology to get home loans done with minimal expense and the savings in lower rates and fees are passed onto you. Find out today how First California Financial can help you refinance your home loan in California or buy a home with us with a low interest rate.

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Posted by Kemmer Daniel Matteson on October 21st, 2014 4:51 PMLeave a Comment

February 7th, 2012 11:29 AM

With the economy slugglish and plodding along and no inflation on the horizon. The feds announced that the federal funds rate will remain low through 2013. This is a long horizon and many factors could change this. 

However with rates now below 4% for a 30 year mortgage this is be the time to buy. With tax deductions for ownership and values as well as rates dropping the mortgage payment you could have is close to what rent would be with a 10 % down payment.

Give me a call and i can run the advantages for you...




Posted in:General
Posted by Kemmer Daniel Matteson on February 7th, 2012 11:29 AMLeave a Comment