ARE YOU EXPLORING HOW TO ENTER THE SANTA CRUZ MARKET?
If you’re considering the Santa Cruz market for either a primary move, vacation home, or investment property, it’s important that you consider the dynamics of the market, but rest assured, there are several ways to make securing your home a reality. While the headlines are typically outdated since the market is moving so fast, we’re here to help you navigate it all.
In this video, we discuss how 1) sellers are buying permanent (not temporary) points for buyers’ mortgage rates to bring down monthly payments, 2) the art of the bridge loan, 3) how our Ready to Sell program upgrades you home to sell without tapping your reserves, and 4) how CRITICAL it is to speak with us because there are so many hidden opportunities and backstories that simply aren’t included in internet listings that you’re browsing to see what the market looks like.
We led off with the sellers buying points for buyers, here’s a real life scenario to spell out how it works for both sides:
Sales price: $1,220,000
Loan Amount: $855,000
Before the Buydown
Rate: 5.875 (.125) – credit to borrower, this is what they consider the undiscounted rate (closest rate to PAR pricing)
Principal & Interest Payment: $5,057.65
After the Buydown
Rate: 4.75% 2.875 – cost to borrower (this doesn’t include any loan level price adjustments, this is all buydown)
Principal & Interest Payment: $4,460.09
Essentially, they paid 3pts because they gave up the .125 credit from the undiscounted rate. This translates to a reduction of .375% in rate for each 1 point paid.
It should be noted that this is a permanent buydown of the rate. It’s often confused with the 2:1 temporary buydown, which only pays down the rate for the first couple years of the loan.
Plus, we also mentioned Bridge Loans that allow you to buy before you sell your home. There's a lot of detail and variables on this one, so it'd be best for us to chat on this since we have the best in the business as our strategic partners to assist you with this amazing option.
We hope you enjoyed this edition of Market Watch. Have you checked out our library of resources, including our READY TO STAY & SELL programs allowing 0% financing for 12 months to fix up bathrooms, your roof, landscaping and so much more whether you’re in the market to buy or sell your home. Plus, our Mortgage & Home Value Calculators will help you crunch your numbers.
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Thank you for letting us be your real estate resource!
-Erick Fernandez