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Are you looking to purchase or refinance a home in Arizona or California?

Valor Lending Group has got you covered! Check out Outstanding Valor Lending Home Loans. We have helped thousands of Californians and real estate investors nationwide. We are excited to announce we are now serving all of Arizona. There is no question too big or too small that we won’t be able to help you with. We pride ourselves on our top-notch communication skills to tackle any situation that comes our way. Reach out to us today, and one of our loan officers will get back to you ASAP with advice you can trust.

Valor Lending Group has Outstanding Valor Lending Home Loans available TODAY!

Outstanding Valor Lending Home Loans in Arizona & California NOW AVAILABLE

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What you will learn:

• Arizona and California Home Loans
  • 2 major categories
    • Owner-occupied
    • Investment (non-owner occupied)
• Choosing the right home loans for you
• Arizona and California Home Loan options
  • Conventional Home Loans
  • Conforming Home Loans
  • Non-conforming Home Loans
  • What a Jumbo Loan is
    • How you qualify for a Jumbo Loan
• Government Loans
  • FHA Loans
  • VA Loans
  • USDA Loans
• Non-Qualified Mortgage (“Non-QM”) Loans
  • Bank Statement Loans
  • Asset Depletion Loans
  • No-Tax-Return Investment Property Loans
• Hard Money Home Loans
  • Consumer Hard Money Bridge Loans
  • Owner Occupied Business Purpose Hard Money Loans
  • Investment Property (Non-owner occupied) Hard Money Loans
• What a Typical Home Loan looks like
  • Debt-To-Income (DTI) Calculation
  • Underwriting
  • Appraisal
• Finding the best Arizona and California Home Loan Lenders
• FHA Loans | Home Loans
  • FHA Construction Loans
• Conforming | High Balance Loans
  • Conforming | High Balance Highlights
• Jumbo Loans
  • Jumbo California Loan Highlights
• VA Home Loans
  • VA Home Loan Highlights
• Recap of Our Products
• Additional programs we offer

Arizona and California Home Loans

If you’re looking to purchase a home in Arizona and California using the best home loans, you will probably need to finance that home. Or if you already own a home you may want to refinance your current home loan to get a better rate or to pull equity (cash) out of your home to renovate your kitchen.

Arizona and California home loans fall into 2 major categories:

(1) Owner-occupied

(2) Investment (non-owner occupied)

Owner-occupied & Non-Owner Occupied, which is right for you? Below we will help you decide.

If you’re looking to purchase or refinance an Arizona or California home loan for a residential 1-4 unit property, here’s everything you need to know about finding the best home loan options.

Choosing The Right Home Loan For You

When choosing the best home loan option for your situation, the primary question is how best to demonstrate your ability to repay the loan.  On owner-occupied, 1-4 unit residential properties, the ability to repay is based on a borrower’s income.

Tax returns, W2s, and 30-day pay stubs qualify the income of salary and hourly employees. Self-employed income can be verified using bank statements and profit & loss statements.

Current liquid assets to make payments over 60-72 months determine a high-net-worth individual’s ability to repay.

To learn more about qualifying for non-owner occupied properties, check out no-tax return investment property loans, hard money loans, and commercial property loans.

What Are My Arizona and California Home Loan Options?

The first step to finding the best Arizona and California home loans is to understand the options available. Depending on credit, down payment, and income, there are many great home loan programs available for salaried, hourly borrowers, self-employed, and real estate investors.

Home loans generally fall into 3 main categories:

• Conventional Home Loans (conforming and non-conforming);
• Government loans
• Non-Qualified Mortgages (Non-QMs).

1) Conventional Home Loans

Within conventional loans, there are two categories of loans: conforming and non-conforming.

(a) Conforming Home Loans

Firstly, conforming loans meet the underwriting guidelines of Fannie Mae and Freddie Mac. Those government-sponsored enterprises then buy, repackage and sell the loans as securities in the secondary market.

Conforming loans, also known as, “agency loans” because they meet the credit and government underwriting matrices Desktop Underwriter (DU) for Fannie Mae or Loan Product Advisor (LP) for Freddie Mac. The maximum conforming loan limits vary by California and Arizona counties (click the links to check out those loan limits).

US Government does not back Agency loans, but rather indirectly through government-sponsored enterprises Fannie Mae and Freddie Mac. Agency loans, sometimes called “vanilla loans,” are the most conservative and have a very low risk of default.

(b) Non-Conforming Home Loans

Secondly, non-conforming loans have loan amounts higher than the maximum limits established by Fannie Mae and Freddie Mac for conforming loans. The agencies do not guarantee they will buy or re-sell nonconforming loans in the secondary mortgage market. There are specific investors, hedge funds as well as other entities for these types of loans.

If it is a jumbo loan, then the loan amount exceeds the conforming loan limits. Jumbo loan terms can vary widely in terms of rate and down payment, but the best jumbo loans have very competitive rates. These are great options for borrowers looking to purchase or refinance in a high-value area.

(c) What is a jumbo loan?

If the property is too expensive for a conventional conforming loan, a Jumbo Loan is an option that borrowers can choose. Federal Housing Finance Agency (FHFA) determines these limits. If you exceed the loan limit for your county, you need a jumbo loan.

Check your county limit here: California Conforming Loan Limits by County and Arizona Conforming Loan Limits by County.

Valor Lending Can Provide the Best Loan Program for Your Loan Scenario

Jumbo loans are called non-conforming conventional mortgages. Jumbo loans are considered high-risk loans for lenders. The reason is, Fannie and Freddie do not guarantee jumbo loans, and the lender is not protected in the event of default by the borrower.

Finally, a fixed interest rate or an adjustable interest rate is typically available.

How do I qualify for a jumbo loan?

• As little as a 10% down payment
• Typically require a minimum of 660.
• Max 50% debt to income ratio. If you have a large number of cash reserves the lender may be more flexible on DTI.
• Cash reserves may be a condition to cover 6 to 12 months of PITI payment.
• More than one appraisal may be required.

2) Government Loans

Government loans are insured by the US federal government through the Federal Housing Administration. Which protects the lender from risks of default. This in turn allows government loans to have some of the best rates available and more relaxed qualification requirements than typical conventional or Non-QM loans.

(a) FHA Loans

This type of loan is government Insured through the Federal Housing Administration (FHA). They also allow for the smallest down payment of all loans, 3-3.5%, or even no down payment when utilizing a down payment assistance program. The county loan limits will determine how much you can borrow.  You can find your county loan limits depending on where the property is located here in California. (Arizona Loan Limits Here) (also required is mortgage insurance, which is around 1% of the loan amount). FHA loans are an incredible option for borrowers with a lower credit score and low down payment.

(b) VA Loans

These are government-backed loans through the US Department of Veteran’s Affairs (VA). The VA Loan offers incredible rates and terms to veterans, active duty military, reservists, and unmarried surviving spouses. VA loans offer financing up to 100% of the reasonable value of the property, no mortgage insurance, and no down payment of up to $1,500,000. Not only are there VA financing options the best California home loan for purchase but they have a unique refinance program called the Interest Rate Reduction Refinance Loan (IRRRL). These are incredible offerings for the men and women who serve our country.

(c) USDA Loans

These government loans are backed by the US Department of Agriculture (USDA). This loan program has no down payment requirement, rates are competitive and no mortgage insurance. This is a great option for borrowers in a rural, USDA-approved area.

3) Non-Qualified Mortgage (“Non-QM”) Loans

Non-Qualified Mortgages (“Non-QM Loans”) have different underwriting guidelines than a typical conventional or government-backed loan. Non-QM loans provide self-employed borrowers and real estate investors with an alternative income qualification method.

Qualified Mortgages are prohibited from having “risky” loan features such as interest-only payments, negative amortization, balloon payments, terms beyond 30 years, or excessive points and fees. Thus, anything with one of these features would be a non-QM loan.

Significantly, non-QM loans for owner-occupied properties (i.e., primary residence, second and vacation homes, etc.) must still follow Dodd-Frank’s Ability-to-Repay (ATR) Rule.  You can acquire financing for conforming loans using tax returns and financing for nonconforming loans through alternative methods.

(a) Bank Statement Loans

Bank statement loans have become the best California home loan option for self-employed borrowers to purchase or refinance a home loan. Bank statement loans are for self-employed and other non-salaried persons who make sufficient income to support a mortgage payment but whose tax returns don’t accurately reflect this.

Traditional mortgage lenders require tax returns, W-2s, and paycheck stubs in order to determine monthly income. For salaried and hourly borrowers, the lenders look at gross income for qualifying purposes. But for self-employed borrowers, traditional mortgage lenders look at net income, the adjusted gross income shown on tax returns. This puts self-employed borrowers at a disadvantage.

With bank statement loans, lenders still want to ensure borrowers can repay their mortgages, they just use bank statements to verify income as opposed to tax returns. Self-employed borrowers are able to document their ability to repay based on business deposits into their personal or business bank accounts, i.e., their true cash flow.

This is an incredible and expanding area of mortgages that levels the playing field for self-employed borrowers, providing the opportunity to qualify without tax returns.

(b) Asset Depletion Loans

Like bank statement loans, a borrower’s ability to repay must be documented with asset depletion loans. However, the ability to repay is calculated based on a borrower’s net worth and liquid assets, not monthly or yearly income.

If a person has very strong assets but limited income, then an asset depletion loan would be a good fit for them. Instead of looking to annual income to demonstrate an ability to repay, asset depletion lenders will look at a borrower’s total liquid assets, and divide them by 60-72 months. If this amount is sufficient to cover the monthly mortgage payment (and all other debts), a borrower can get qualified for the loan.

(c) No-Tax-Return Investment Property Loans

No-tax-return investment property loans are the best Arizona and California home loan option for real estate investors, which allows qualification based on the positive cash flow of the subject property. If the rental property is cash flow positive, that will constitute sufficient qualifying income.

With an investment property, lenders will use the subject property market rents less the property expenses to qualify the loan. With this method, lenders are assured the loan will be repaid, as they are looking at the net income of the property only.

Sometimes called “landlord loans” or “rental loans,” no-tax-return investment property loans do not consider a borrower’s income in the traditional sense. As such, the cash flow of the property is the income factor.

In comparison, traditional mortgage lending requires tax returns for qualification, they are not required for investment property loans. With these loans, real estate investors are able to purchase or refinance a property with no employment required, no personal income considered, and no debt-to-income ratio developed.

4) Hard Money Home Loans

Another option, which is a Hard Money consumer bridge loan, aka “bridge money” may be an excellent answer when purchasing a home, while waiting for your departing residence to be sold.

All “bridge” loans are hard money loans. Hard Money Loans can be the best Arizona and California home loan solution. This type of loan program provides temporary funding needs, and they are closed quickly and require minimal documentation.

(a) Consumer Hard Money Bridge Loans

Borrowers can use hard money consumer-purpose bridge loans to purchase a new residence while waiting for a departing residence to sell.

Consumer-purpose hard money loans also allow homeowners to cash out equity in their property to use for consumer purposes such as paying off personal debt or remodeling a primary residence.

(b) Owner-Occupied Business Purpose Hard Money Loans

Business-purpose owner-occupied hard money loans provide borrowers a way to access the equity in their property by cashing out equity available. These loans are a great way to quickly put cash into a borrower’s pocket.

(c) Investment Property (Non-Owner Occupied) Hard Money Loans

This type of loan is frequently a good choice when time is of the essence. Because of their speed, investment property hard money loans provide same-as-cash purchasing power for acquisitions, and quick access to equity (cash) for cash-out refinance transactions.

What Does A Typical Arizona and California Home Loan Look Like?

The typical loan approval process takes 3-4 weeks for conventional, government, and non-QM loans. That said, hard money loans can close faster because this process involves comparing total income to all debts, underwriting and disclosure processes, and property valuation.

1) Debt-to-Income (DTI) Calculation

Loans on owner-occupied residential properties and lenders must document the borrower’s ability to repay. The above methods will determine the ability to repay.

DTI or The debt-to-income ratio typically includes all of a borrower’s monthly debts such as car payments, student loans, minimum credit card payments, and the like. DTI also includes taxes, insurance, and HOA dues for the property, as well as the new loan’s principal and interest payment.

For example, assuming a monthly income of $10,000, and monthly debts of $5,000 then the DTI Ratio = 50% ($5,000/$10,000).

Loan programs have different maximum DTI allowances as high as 55%.

2) Underwriting

There is an involved process when underwriting real estate financing. All income and debts must be verified, credit and housing history verified and reviewed, and loan disclosures and legal regulations complied with.

Most loan officers employ full-time processors to coordinate with the lenders’ underwriters and third parties for required verification. If conditional approval has been provided and the underwriter has started the due diligence then the loan is in underwriting. This process typically takes 1-2 weeks but sometimes longer for more complicated loan files.

3) Appraisal

Once the underwriting commences, the lender will typically order an appraisal. The appraisal process can also take around 1-2 weeks. The condition of the property and the most recent sales in the area will determine the value of the property. The sales approach involves the review of recently sold and comparable properties to assess value.  The sales approach is the most common approach.

Allow 1-2 weeks for the appraisal process to be complete and back to the Lender. Finally, the lender’s quality control department will review the appraisal report because it can have errors. All of this adds up to about 1 to 2 weeks.

Receiving a satisfactory appraisal report with a sufficient home value is a condition of all lenders’ funding decisions.

Finding The Best Arizona and California Home Loan Lenders

With so many varieties of home loan programs and the many variables and nuances within program categories, shows it is most often advisable to work with a loan broker who can advise and suggest the available options. It’s a good idea to choose a broker with knowledge of and access to all available loan programs. In the end, you have to choose the right mortgage professional for you.

For example, if you think you might qualify for a bank statement loan but not a conventional jumbo loan. Speak with a loan broker who will narrow your options and set you up for successful funding of your loan.

Many lenders across all categories of Arizona and California home loans do not have a retail channel, they prefer working with brokers.

That said, the best brokers spend many hours scouring thousands of loan programs looking for the best rates and terms. Mortgage rates change often and borrowers are looking for the best Arizona and California home loan options. It is in the broker’s best interest to find the lowest rate and most favorable terms available for them.

There are upfront fees such as a credit check, appraisal, or placing the funds into a separate performance escrow. Any high upfront fees and costs should be a red flag. Some lenders will require an application fee deposit because they conduct initial site visits or property evaluations but not often.

A) FHA Loans | Home Loans

Federal Housing Administration insures their loans. They also allow for the smallest down payment of all loans, 3-3.5%, or even no down payment when utilizing a down payment assistance program. The county loan limits will determine how much you can borrow. County loan limits may vary depending on where the property is located. You can find the Arizona County Limits here and California Loan limits here (also required is mortgage insurance, which is around 1% of the loan amount). FHA loans are an incredible option for borrowers with a lower credit score and low down payment.

FHA Construction Loans

The FHA construction loan is a product that allows qualifying borrowers to use financing funds to purchase a lot, do all of the lot improvements and construct the house.  An excellent feature of this loan is, after construction is complete, the loan immediately transfers to a 30-year fixed loan without having to qualify again.  It is one loan that encompasses all phases into one loan!

B) Conforming | High Balance Loans

We are still funding Arizona and California home loans because we constantly scour for the best rates and terms in the industry.

Conforming | High Balance Highlights:

• Interest Rates currently starting in the low 3’s w/NO ORIGINATION POINTS
• Fast Turn Times for Approvals and Appraisals
• Primary Residence, Second Home, Investment Properties

*California SFR Primary Residence Purchase, $500k Loan, 720 FICO, 3.25% APR

C) Jumbo Loans 

We have numerous Jumbo Loan Lenders in our portfolio with programs for all types of luxury property financing. Check out some of our best pricing below, we are currently funding up to 95% Max LTV:

Jumbo Loan Highlights:

• Up to 95% LTV with NO MI
• Flexible Guidelines
• Non-Occupant Co-Borrower + Gift Funds
• 15, 20, 25 & 30-year fixed interest rates.
• 3, 5, 7, & 10-year ARM’s.

GIVE ME A CALL to get your pre-approval for the program that fits your needs.

Whether you are buying your first home or deciding on where to retire we will help you find the right mortgage for the right home.

D) VA Home Loans

Finding the best VA Loans have never been easier. Valor has government-guaranteed VA Loans available to Veterans, active duty military, reservists, and surviving spouses.  VA Loans offer financing up to 100% of a property’s value and feature both fixed and adjustable-rate loans. And there is NO down payment up to $1,500,000.00!

Valor VA Loan Highlights:

• 100% Financing
• Sellers can pay closing costs, up to 2 discount points
• Buyers can add up to $6,000 to their VA loan to have energy-efficient improvements installed
• No monthly mortgage insurance
• Less restrictive qualifying terms
• Buyers still eligible even after a short sale
• Jumbo loans available up to $1.5 million
• Buyers can have multiple VA loans under certain circumstances.
• *Valor will reimburse your appraisal fee for loans above $300,000.
• **We give 5% of proceeds to a local Veteran charity on every VALOR VA Loan

**Valor Lending Group is committed to serving our Military Members.**

We also offer:

• Bank Statement Loans
• Hard Money Loans
• FHA Loans

CALL OR EMAIL ME for immediate attention to your scenario!

Recap of our Loan Products

1. Hard Money Loans (20% down / minimal documentation) are Typically funded in 7-10 days.
2. Stated Income Loans (Great for business owners and self-employed) No tax returns!
3. 100% financing is available (we can cross-collateralize other properties if there is enough equity)
4. Valor VA Home Loan 100% financing up to $1.5MM
5. Rental Property Loan – No tax returns or DTI calculation! Based on the subject property’s cash flow – No DSCR Coverage is needed!
6. Flipper & Rehab Loans (Flip a property with one of our many options)
7. 2nd Position Loans up to $5mm
8. Raw Land & Lot Loans
9. Ground-up Construction for spec homes, custom homes, and commercial ground-up.
10. Farms, Vineyards, Ranches, and Agricultural Properties (25-30% down)
11. 10% down Jumbo’s up to $1.5mm
12. Manufactured Housing / Mobile Homes (20% down / 600+ credit score)
13. Acreage Properties
14. Commercial Loans up to $500mm
15. 3% & 5% down Conventional Loans– LPMI (Lender paid mortgage insurance)
16. Foreign Nationals Loans (no social security or residency required)

Other Programs we Offer:

1. Conventional Conforming Loans
2. High Balance Conforming
3. Jumbo Loan Financing |10% down Jumbo to $1.5mm
4. FHA, USDA
5. Reverse mortgages up to $1 Million in Value
6. Cash-Out Refinancing

We look forward to the opportunity to serve you!

For the most up-to-date mortgage news visit: Mortgage News Daily

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