by Pom Luxton, Manager - Private Lending Group, American Savings Bank www.ASBHawaii.com, Equal Housing Lender, Member FDIC
A jumbo loan is a loan for an amount that exceeds conforming limits, established by regulation. These loans, offered by lenders such as American Savings Bank that have portfolio lending capabilities, may be used for purchases or refinances and are for primary residences, second homes and investment properties.
For 2017, FHLMC and FNMA announced that the jumbo loan maximum increased from $625,500 to $636,150. In Hawai‘i, this means jumbo loan amounts exceed $636,150. The maximum jumbo loan amount varies depending on the loan-to-value, occupancy and loan purpose. For a loan amount of $636,200, the purchase price would be $795,300 with 20% down payment. For an amount of $2,000,000, the purchase price would be $2,857,200 with 30% down payment. (Figures round up to the nearest $100.)
Jumbo loans are offered in a variety of terms, including fixed and adjustable rate mortgages. A jumbo loan could also be used in a “piggyback mortgage” – a simultaneous first mortgage and home equity line of credit (second mortgage) generally used to purchase a home with a down payment less than 20%.
Each client situation is unique; consult a residential loan officer for specific situations. Loans are subject to qualification and approval, lender’s credit and underwriting policy.
Jumbo Loans Change in 2018
By Pom Luxton, Vice President, Manager, Private Lending Group, American Savings Bank, www.ASBHawaii.com
A jumbo loan is a loan for an amount that exceeds conforming limits, established by regulation. These loans, offered by lenders such as American Savings Bank that have portfolio lending capabilities, may be used for purchases or refinances and are for primary residences, second homes and investment properties.
For 2018, Fannie Mae and Freddie Mac announced that the maximum loan amount for a 1-unit single-family residence or condominium unit increased from $636,150 to $679,650. In Hawaii, this means you can get a jumbo loan for financing exceeding $679,650. The maximum jumbo loan amount varies depending on the loan-to-value, occupancy and loan purpose. For a loan amount of $679,700, the purchase price could be $849,625 with 20% down payment. For a loan amount of $2,000,000, the purchase price would be $2,857,200 with 30% down payment. (Figures are rounded up to the nearest $100.)
Jumbo loans are offered in a variety of terms, including fixed and adjustable rate mortgages. A jumbo loan could also be used in a "piggyback mortgage" – a simultaneous first mortgage and home equity line of credit (second mortgage) generally used to purchase a home with a down payment less than 20%.
Each client situation is unique; consult a residential loan officer for specific situations. Loans are subject to qualification and approval, lender’s credit and underwriting policy.
What You Need to Know About VA Loans
By Yvonne Ako, Residential Loan Manager, American Savings Bank, www.ASBHawaii.com, Equal Housing Lender, Member FDIC
Are you eligible for a VA home loan? VA loans offer assistance to U.S. service members, military veterans, and eligible surviving spouses. The U.S. Department of Veterans Affairs guarantees a portion of the VA loan, allowing lenders such as American Savings Bank to provide the veteran with favorable terms.
Some situations where veterans can take advantage of VA loans include the purchase of a one-unit owner-occupant home (up to 100% of the purchase price, provided it’s within the maximum loan amount for the county), refinancing an existing mortgage, or taking advantage of the equity in a home to finance home repairs and other life events.
Unlike conventional mortgages where private mortgage insurance (PMI) is required by the borrower for loan-to-values over 80%, there is one-time upfront VA funding fee that can be financed into the loan amount. And, if the veteran has a service-related disability, this fee could be waived.
If the veteran has an existing VA loan and simply wants to refinance to a lower rate and payment, lenders may offer a streamlined refinance called an Interest Rate Reduction Refinance Loan (IRRRL).
Each veteran’s situation is unique, therefore, consult an experienced professional residential loan officer for specialized assistance. VA Loans are subject to the lender’s credit and underwriting policies and guidelines.
When and Why Should You Consider a Portfolio Loan?
by Alan Miyasaki, Residential Loan Manager, American Savings Bank, www.ASBHawaii.com, Equal Housing Lender, Member FDIC
Portfolio loans are designed for clients in a unique borrowing situation, such as financing the purchase of a specific property type (e.g. a unique condominium unit or condo hotel) or a property with unusual zoning.
Also known as non-conforming or non-saleable loans, portfolio loans do not meet “agency guidelines” for Fannie Mae (FNMA) or Freddie Mac (FHLMC). Instead, they are offered by local lenders with portfolio lending capabilities, such as American Savings Bank, who understand Hawaii’s unique real estate market.
Other situations that would merit a portfolio loan include residential loans to professional corporations and limited liability corporations; borrowers whose income history does not meet agency guidelines (e.g. a new medical doctor/professional in residency in which employment will start without two-year history); and loans for a unit in a co-op (a building owned by a cooperation)/condos with a high concentration of investor owners or commercial usage.
Other common portfolio loan situations include financing the purchase of a vacant lot, construction-to-permanent loan financing, and borrowing more than the FNMA/FHLMC loan maximum of $679,650.
Each client situation is unique. Consult an experienced residential loan officer with your client’s specific situation to learn more. Loans are subject to qualification and approval, and to each lender’s credit and underwriting policy.
