Category: Creative Financing

TEMPORARY BUYDOWNS V PERMANENT BUYDOWNS

  With higher interest rates, we’re getting questions regarding “buying down” the rate. Some people want to do a 2-1 buydown. What is this? How does this work? Is this the same as permanently buying down the rate for the life of the loan? A 2-1 buydown is an example of a temporary buydown. In a 2-1 buydown, the interest rate is 2% lower in the first year, and 1% lower in the second year. If today’s rate is 7%, then the first year the rate would be 5%, and the second year the rate would be 6%. The lender,...

Read More

GIFT OF EQUITY FOR DOWN PAYMENTS

You may, or may not be familiar with a gift of equity. What is a gift of equity? Perhaps your child is looking to purchase a home and you are ready to sell your home. Your child has expressed an interest in living in the childhood home instead of you selling it to a third party. but, your child has no money for down payment or closing costs. If your child can qualify for a mortgage, you can gift the equity in the home for the down payment. Lenders are keen on the non-arms length nature of this transaction, so...

Read More

WHY USE A RESIDENTIAL LOAN TO FINANCE A BUSINESS?

      How can you use a residential loan to finance a business? And, why would you? Business loans tend to have higher rates and costs than residential loans, and may be adjustable. The residential loan can be fixed. For instance, if you have equity in your home, or other residential properties, you could refinance and take cash out of one of these properties to purchase the business or investment. The lien would be on your residential property, but the loan terms may be more favorable than the commercial loan. We had a scenario where a client was looking...

Read More

WE WORK FOR YOU, NOT THE LENDER

One of the many reasons you want to work with Counsel Mortgage Group is that we have great flexibility to get a deal done. As a mortgage broker, we have relationships with many different lenders who offer a variety of products. Here are a couple examples of how we can help: A client comes in with less than perfect credit, they have a steady job, student loans, car loan, and credit cards. As a result of the heavy debt load, their credit score has suffered, and is under 600, around 585. There are actually two ways: One is if they...

Read More

INVESTMENT OPTIONS

The following is a little help to analyze your options. Let’s say you worked hard and saved money over the years. It is sitting in your checking or savings account, and making little or no interest. You’d like to have your money work for you. You are considering investment options, such as stocks, mutual funds or real estate.  First, try not to be emotional. When you invest, you are looking for the best return on your money. Don’t get caught up in whether you are “in love” with a stock or piece of real estate. Try to stay analytical. Second,...

Read More