Sunday a.m. reading: Getting a mortgage may be easier than you think. And Moby.

Both today's L.A. Times and today's NY Times have articles today about the loosening of mortgage requirements.  The L.A. Times link is here.  Some particularly excellent news: Fannie Mae is going to lower the downpayment requirement from 5% to 3%.  Before anybody starts thinking about "moral hazard" and such, consider Southern California's buyers who aren't wealthy.  If the average house costs about $450,000, the downpayment now needs to be $13,500.  Plus about 2% in closing costs.  That equals $22,500 and represents A LOT of savings for younger or middle-income buyers.

Today's other news is that performer Moby just sold a Hollywood Hills home for $12+ million.  He bought it four years ago for a little under $4 million, and spent -- sit down -- $2 million restoring it.  At first I thought the $2 million was a misprint, as I couldn't imagine what could possibly cost that much. What could that huge amount possibly be spent on? Diamond-encrusted laundry rooms? Fur-lined sinks? Real unicorns for the yard? But the house is apparently huge, so... The other big take-away is that Moby made about $6 million on this transaction.  Yup, that's huge.  Not bad for a non- professional real estate investor dj-songwriter.

Ask me anything: do cash offers ALWAYS prevail over financed offers for a house?

No, a home buyer's all cash offer DOES NOT always win out over an offer with a loan.  These days, it seems like many buyers are wonderfully qualified by truly talented direct lenders. (I will be blogging about this when my 848 N. Avon property in Burbank closes next week.)  If you are a property buyer out there in Burbank, Studio City or anywhere else in the east San Fernando Valley or Northern Los Angeles area, and you need a loan in order to purchase a home, here's what you can do:
- Get pre-approved by a direct lender, such as Prospect, Wintrust, or Madison Lending. You can also go to property lenders at Chase or Wells Fargo. And by all means, check with your credit union.  That means, yes, filling out all of the paperwork and turning in all your needed financial documents.
- Please stay away from "middle-men" lenders who just take your paperwork and then push it out to a random lender.
- Do this in advance.  Please don't wait until you've already found the house.  You'll have to get the paperwork together eventually anyway.
- Clean up any credit issues.  Your lender can help you with identifying what these may be.
- Save as much money as possible.  I know this is hard, but perhaps you can defer big purchases for one more year.
- Gifts from family members are good, but please make sure they are indeed gifts and there is no expectation of a payback.
As always, please feel free to contact me with any questions or concerns re home buying!

Ask me anything: can student loan debt affect your ability to get a home mortgage?

Can student loan debt affect your ability to get a home mortgage?  Yes, because it's part of your entire financial picture.  And it seems that most people's student loan debt is soaring.  However, only your lender can tell you for sure.  Other factors about your income and finances may outweigh your debt.  Remember, when you choose a lender, go local and go for a direct lender.