Buying and Selling Your Davis, CA Home with Keller Williams agent Carmen Isais

CalSTRS has two programs available to First Time Home Buyers, FTHB.

One is 97% financing program and the other is 100% financing program, however, the 100% financed program has fallen out of favor this past year due to the inability to find mortgage insurers and the housing decline. Not to fret, the 97% financing program is by far the better of the two.

The 97% financial program is an 80/17. The first mortgage is 80% of the loan amount and the second mortgage is 17%. The 2nd mortgage also can be deferred for 5 years at the exact same rate as the first!!!

For example, if you were purchasing a home for 300K, then the first mortgage would be 80% of that amount, or 240K. Just for argument sake, let’s say the rates was 6.5% on the first mortgage. Therefore, the second mortgage, 17% of 300K is 51K, would be at that same rate, 6.5%. Thus, you would be able to purchase the home at 6.5% and at 97% of the value!!

But Wait, The Program Gets Even Better…

You can defer the second loan’s payments for 5 years! You don’t have to pay the second loan for five years, but simple interest is added to your second mortgage each year at the same rate, 6.5%. So using the example above, the 2nd mortgage of 51K at 6.5% will accrue ~$3,315 the each year for 5 years, so ~$16,600 at the end of the 5 years will be added to the second for a total of ~$67,600. The loan is then amortized for the remainder of the 25 years at 6.5%. Your payment will be ~$456!!

Lastly, the program allows you to receive a seller’s credit toward the closing cost, so theoretically you are able to purchase the home for 100% financing. Also, third party members, such as Realtors and brokers are also eligible to credit toward the closing costs. In addition, family members can gift the 3% for the down as well. The above are all options for you to purchase your first home. Just remember, if you are placing an offer on a home, PLEASE, make sure your Realtor places within the contract the seller’s credit toward closing costs because it is difficult to back track once the offer is given to the listing agent or the bank, especially if it is a bank owned property.

We promise you  at Equistar Funding Corporation, you will not find a sweeter deal than this one…Please give us a call if you have any questions regarding the rates, or this FTHB’s program at 530.753.5657.

Also, for your convenience the rates are accessible by clicking the link below. http://www.calstrs.com/Members/Home%20Loan%20Program/rates.aspx

We look forward to talking with you.