Do You Really Have to Have a 20% Down Payment Right This Minute? Presently, How Much Should You Save For The Best California Home Loan Interest Rate Today?

When the financial advice website NerdWallet surveyed home buyers in 2019, they learned that almost two-thirds of them (62%) thought they needed at least a 20% down payment to buy a home. That’s not true, especially if you’re a first-time homebuyer. NerdWallet’s survey found that the average down payment for first-time homebuyers in 2019 was 7%, and among all buyers, the average rose to 16%.

What kinds of home mortgages require less than a 20% down payment?

FHA Home Mortgages: FHA home loans start with a minimum of 3.5% down payment. 30 year fixed rate FHA loans also have more flexible standards for credit scores than other loan programs. USDA loans also don’t require down payments and can offer mortgages in USDA-qualified areas.

VA Home Mortgages: VA loans require no down payment for eligible veterans. You can get a 30-year fixed-rate VA mortgage or a 15-year fixed-rate VA mortgage with no money down. As of January 1, 2020, the VA lifted county loan limits, so you can get a no money down VA home mortgage in any amount you’re qualified to receive.

Conventional home mortgages: Conventional mortgages can offer down payments as low as 3% and potentially lower. Some mortgage lenders offer down payment assistance grants, especially for first-time and non-traditional home buyers.

How much should you save for a California home mortgage down payment?

You can use a mortgage calculator to see how much your payments will be with different down payment amounts. Save as much as you can, but as we’ve already said, you don’t have to save 20% for the down payment. As you save, keep in mind you will need to pay for other costs when you close your loan. You may also need to pay for mortgage insurance with a lower down payment.

You have many options for your mortgage and more flexibility in home buying and loan choice than a lot of online advice articles show. This is another reason you should work with an experienced California mortgage specialist who can help you plan to get a loan with a down payment you can afford along with monthly payments that help you meet your home buying and financial goals.




It turns out LA Times has had “20% down payment is dead” articles for 3-4 years – here is another one with the same headline:




Should I Start Refinancing My 30-Year Fixed Mortgage Soon Or Should I Aim For A Shorter-Term Mortgage? Need A Sound Advice Now.

If you can reduce your mortgage payments by refinancing and lock in a payment you know you can afford, you should consider refinancing. Here are a few financial tips for mortgage refinance that fit the current financial climate:

Do you have high-interest debt you’re working to pay off?

You may owe $10,000 or $20,000 in credit card debt. Have you looked at the difference between how much you’re paying in interest and how much on the balance you owe? You may find that 50, 60, and even 80 percent of your monthly payment is paying interest. 

Using a mortgage refinance to pay off high-interest debt with a low-interest 30-year fixed-rate mortgage could save you thousands of dollars. Refinancing your mortgage to pay off high interest credit card debt may be a lot of work but your financial result will be worth it. 

Do you have student loan debt you want to eliminate?

Student loan interest rates may not be quite as high as high-interest credit cards, but the average unsubsidized student (or parent) loan starts at 6 percent interest and can go up from there. Similar to credit card debt, you can save money on interest by refinancing to a lower-interest 30-year fixed rate mortgage.

Can you reduce your monthly mortgage payment?

Lowering your monthly mortgage payment is one of the best reasons to refinance. If you can locate a loan which has a lower annual percentage rate (APR) than your current loan, it’s worthwhile to investigate your refinancing options.

Can you afford a shorter-term mortgage?

If your finances have improved significantly since you got your initial mortgage, you may benefit financially from refinancing from a 30-year fixed mortgage to a 15-year loan term, or any other term such as 27 year, 25 year, 21 year, 18 year etc.  The options are limitless with a savvy independent mortgage broker on your side. The savings in interest can be substantial. 

For example, if you have a $500,000 30-year fixed rate mortgage at 4 percent, you’ll pay approximately $859,300 in principal and interest over the course of your loan. If you refinance your loan to a 15-year mortgage, even at the same 4 percent interest, your total payments will be $665,719. That’s a difference of almost $200,000.

Refinancing your 30-year fixed rate mortgage can be a smart financial decision for a lot of reasons. An experienced independent mortgage loan broker such as California Platinum Loans can let you know what your options are so you can make the right financial decision.



Make This Year Your First Time Ever, Where You Learn How to Negotiate: Tips on How To Successfully Win a Home Bidding War

Bidding War

In today’s real estate market, the most desirable homes can often sell for higher than their original asking price. How does this happen? Well, if you’re looking at elite properties, you may already know: more than one buyer who can afford the home competes to get the desirable address, luxurious estate, and premier neighborhood. Buyers engage in a bidding war. But does the highest bidder always win? Not always. There’s more than money involved in competing offers on real estate, especially with premium properties.

Does the highest offer always win the bidding war?

Selling a home is a financial decision, but it’s also a personal one. Owners are understandably attached to their home, and they naturally have feelings of wanting the next family to move in to be as comfortable and happy as they were. This is why some real estate professionals counsel that it’s smart to write a letter of introduction or actually meet the owners if it’s possible and advisable. 

Here are some other “must-haves” if you know you’ll be in a competitive situation when making an offer on a house:

  • Get pre-approved for financing

  • Increase your earnest deposit

  • Be flexible on conditions (repairs, escrow period, etc)

  • Prepare multiple contracts – anticipate potential increases

  • Negotiate flexibly

Most of all, you should be prepared mentally when making an offer on a home. You may be one of several qualified buyers. In any negotiation, you should always be aware of the maximum amount you can reasonably afford. Don’t go beyond your comfort zone or realistic financial expectations just to “win a war” against another buyer. No matter how much you may love the home you’re bidding on, there will always be another opportunity. 

The ability to win a bidding war on a desirable home is one of the most important reasons you will want to work with an experienced home sales, loan, and real estate professional. California Platinum Realty and California Platinum Loans have the experience necessary to guide you through even the most complex real estate negotiations.