Shatter the Home Loan Myth

You yearn to buy a Laguna Beach home, but you’re stymied by a dread of the “home loan myth.” You don’t dare contact the bank – they’ll only reject you. Like hundreds of people, you believe a home loan is impossible without a mind-boggling down payment AND a stratospheric credit score. No doubt about it. This widespread belief is hampering the housing market in a big way.

Well, it’s high time to shatter the home loan myth once and for all – you don’t need a small fortune or a soaring FICO to get a loan for an Orange County home. That’s yesterday’s news. Truth be told, banks are writing more and more home loans every day for ordinary folks.

The facts speak for themselves. In both Orange and L.A. counties, a 3.5% down payment will get you an Orange County home loan of $729,750. This translates to a purchase price of $756,000, with a required down payment of $26,500. And get this: A credit score of 640 is generally all it takes to get you in the door.

Now, I’m not saying it’s the loan fest that rocked the market about five years ago. Lenders still are looking more carefully before they leap. However, the pendulum definitely has swung back a certain distance. Thankfully, common sense once again has returned to the mortgage mix.

Just look at what’s happening with down payments. They’re shrinking. That’s right. Required amounts haven’t been this low in years — even on the beefier loans. Thanks to our improving economy, there’s also a wonderful new optimism reflected in the less stringent underwriting process many banks have adopted. Borrowers no longer have to jump through hoops.

Naturally, the bigger the chunk those borrowers put down, the greater the loan amount can be. For instance, a 10% down payment can secure a loan of up to $875,000, while 20% up front will connect you with as much as $2 million. 

To make life easier, be sure to get preapproved for a loan before you embark on your home hunt. Believe me, it’s a lot easier to work out the details prior to escrow.

So get over your ‘loanaphobia’. There’s no reason for it. If you can afford the mortgage payments and can provide proof of income, there’s a good chance you’ll get approved for the Laguna Beach home of your dreams.

Now that you know there’s nothing to fear, don’t wait a second longer. Contact The Coastal Property Experts today. Our team will be delighted to answer any of your questions and help you discover the wealth of opportunities waiting for you in the Orange County real estate market.

Connect with our team at 949.922.8490 or hillary@thecoastalpropertyexperts.com.

Until next time, Sunny Days and Smooth Sailing!