11/19/2024 – LLPA’s and First Time Buyer Programs

Big Savings for First-Time Homebuyers: Understanding Loan Level Price Adjustments (LLPAs)

If you’re a first-time homebuyer, you may qualify for significant savings thanks to recent Loan Level Price Adjustments (LLPAs) changes. These fees, charged by Fannie Mae and Freddie Mac on conventional loans, are now waived for eligible first-time buyers with household incomes under approximately $130,000 in high-cost areas like Los Angeles County.

This waiver can save buyers thousands of dollars in upfront costs or interest over the life of their loan, making homeownership more accessible than ever. However, it’s important to note that only mortgage bankers, like Augusta Financial, typically offer this waiver. Brokers and credit unions often don’t have access to it, so choosing the right lender is critical to maximizing your savings.

What Are LLPAs?

LLPAs are fees based on a borrower’s perceived risk and are influenced by factors such as credit score, loan-to-value (LTV) ratio, type of property (Condo), and debt-to-income (DTI) ratio. Borrowers typically pay these fees through slightly higher interest rates or upfront costs.

How the First-Time Buyer Waiver Works

For qualifying first-time buyers in Los Angeles County, the LLPA waiver eliminates these additional fees, significantly reducing the mortgage cost. For example:

• A borrower with a lower credit score (e.g., 659) could save thousands in closing costs compared to previous pricing.
• The waiver applies only to eligible buyers meeting income limits, making it critical to work with a lender who can guide you through the qualification process.
• The rate could be the same rate as someone with 70% down.

Other Ways to Save

In addition to the LLPA waiver, first-time buyers can explore additional programs:

• CalHFA Loans: Offer down payment assistance with income restrictions.
• Chenoa 100% Financing: No income limits, and you can purchase up to $1,200,000 with no money down.
• USDA Loans: Provide zero-down financing for properties in rural and designated areas, with some income limits.

Why Your Lender Matters

Not all lenders can offer the LLPA waiver or other specialized programs. As a banker, Augusta Financial provides access to these savings, which are often unavailable through brokers or credit unions. Choosing a lender who offers these options can make a significant difference in your home-buying journey.

I am available all week if you need anything. Let me know if you have any questions or if someone is interested in buying a property. My cell is 661-714-6258, and my office line is 661-260-2970 ext. 2222. My direct line is 661-291-2222. When you text me, please text (661-714-6258) or email me at Mike@AugustaFinancial.com.

But wait, there’s more!

Interest rates have been better the past couple of days, but it has been a rough couple of months. The big economic data is coming on Thursday, so things could get interesting then. Am I a sick guy hoping the unemployment number is awful?  

• 12-day escrows if your buyer is pre-approved - Conventional / FHA / Jumbo / Bridge
• We do loans in all states, so call me with anything you need.  
• Government Loans (FHA / VA/ USDA) are in the 5’s and 6’s.
• Conventional Loans up to $766,550.00 are in the 6’s
• High Balance Loans $766,550.01 – $ 1,149,825.00 are in the 6’s
• Jumbo loans above $1,149,625 are in the mid to high 6’s
• Bank statement loans - They are available with 10% down again, and larger down payments are in the 6’s.
• Profit and Loss Statement loans – 20% down – You don’t need bank statements, just a profit and loss statement!
• No income qualifier – 40% down with r serves In the 8’s!
• 0 down loans are in the high 6’s – 620 credit score min right now, up to $1,191,000.00.
• Private Money lenders - Hard Money Loans – 35% down!
• No Ratio Loans 30% down
• DSCR – Debt Service Coverage loans with as little as 15% down
• Bridge Loans - typically 7.99% with limited fees – and they get you where you need to go!
• 3/2/1 Buydowns 2/1 Buydowns and 1/0 Buydowns are available at great start rates!

Interest rates are subject to change without notice. The above are LA County Loan Limits.

Good News / Condos – N/A

Bad News on Condos – Stratford Condos Stevenson Ranch – Insurance is not sufficient – Sadly, we have to move those babies over to the naughty list!

All other naughty condos have been moved to MikeMeena.com. I will post updates here, but all the information on the naughty list is on my website. Just go there and click about, and you will find our most updated list.

Please let me know if you hear anything new on condos or townhouses.

I am still available all week if you need anything. Let me know if you have any questions or if someone is interested in buying a property. My cell is 661-714-6258, and my office line is 661-260-2970 ext. 2222. My direct line is 661-291-2222. When you text me, please text (661-714-6258) or email me at Mike@AugustaFinancial.com.

Have a great day and an even better tomorrow. Please call me when you have a client who needs to borrow!