Creative lending options enables Sea Ranch home purchase
First mortgage: 30-year fixed at 4.125 percent with no points; HELOC: 5.99 percent.
The buyer already owned a home at the Sea Ranch seaside community and wanted to buy one larger before selling his current residence.
The buyer’s agent, Hanne Liisberg of the Coastal Real Estate Company, knew that Holmgren had access to many funding structures as a mortgage banker/broker.
Since the buyer had enough equity in his original home to completely pay off the HELOC after sale, he would be left with an affordable 30-year fixed rate loan after the sale of the original home.
Since HELOCs are revolving lines of credit, once the loan is paid off, it will remain in place in case the buyer needs to access those funds in the future for home improvement or any other purpose.
Because debt ratio requirements are more stringent when a buyer is putting less than 20 percent down and HELOC loan requirements are much more conservative than first mortgage requirements, Holmgren had to restructure the buyer’s debt profile to meet credit score and debt ratio requirements, but this was accomplished in the first week of the escrow period.
The buyer already owned a home at the Sea Ranch seaside community and wanted to buy one larger before selling his current residence.
The buyer’s agent, Hanne Liisberg of the Coastal Real Estate Company, knew that Holmgren had access to many funding structures as a mortgage banker/broker.
Since the buyer had enough equity in his original home to completely pay off the HELOC after sale, he would be left with an affordable 30-year fixed rate loan after the sale of the original home.
Since HELOCs are revolving lines of credit, once the loan is paid off, it will remain in place in case the buyer needs to access those funds in the future for home improvement or any other purpose.
Because debt ratio requirements are more stringent when a buyer is putting less than 20 percent down and HELOC loan requirements are much more conservative than first mortgage requirements, Holmgren had to restructure the buyer’s debt profile to meet credit score and debt ratio requirements, but this was accomplished in the first week of the escrow period.