Renovation time for lenders

Jim Porter

Solano Real Estate Scene: Jim Porter

Article By: Jim Porter – May 10, 2024

As lenders across America suffer through one of the worst mortgage markets in history, brokers, bankers, fintech lenders and credit unions are opening their minds to new loan products to keep their doors open.

Fifty percent of the people that were in the mortgage business in May 2022 have now retired or moved on to new jobs and careers. Many people have been laid off, lots have quit, some have moved from the mortgage department at the bank or credit union to other departments, and included in my 50% estimate, are the thousands of commission-only salespeople that are now only making 20% of what they need to pay their bills.

Dictionary.com defines the word renovation as “the act of reinvigorating or reviving”. The old guys like me that took their first loan application when Jimmy Carter was in office have had to renovate and adapt dozens of times over the years to remain successful and support our families.

The loan officers that are going to win the day must adjust and renovate their offense and defense just like Caitlyn Clark’s Iowa team did over the last couple years to make it to the finals two years in a row.

My team, along with some of my competitors, are now offering renovation, construction, private money, HELOCS, fixed-rate second mortgage, mobile home, accessory dwelling unit, commercial, and NON-QM loans to make up for the lack of traditional first mortgage purchase money and refinance-loan volume.

Homeowners across California are adding ADUs to their property for income or for mom. Most have very-low-rate first-mortgage loans and so now we are offering home improvement loans for people that need $175,000 to build a home in their backyard.

Another group of people that might become interested in borrowing some money are single-family dwelling landlords that own their rental property free and clear. There are 2,500 rental property homes in Vacaville and Fairfield that have been owned by the owner for more than 30 years.

I think some are going to do $200,000 loans to get tax-free money out of their rental homes to add ADUs, renovate or maybe just buy a Lamborghini and start to fill that bucket list.

There are not any liar loans anymore but non-QM loans exist which makes it super easy to borrow against a rental property with no tax returns required and very little paperwork at rates just slightly higher than full-doc loans.

Jim Porter, NMLS No. 276412, is the branch manager of Solano Mortgage, NMLS No. 1515497, a division of American Pacific Mortgage Corporation, NMLS No. 1850, licensed in California by the Department of Financial Protection and Innovation under the CRMLA / Equal Housing Opportunity. Jim can be reached at 707-449-4777.

Contact Us to Schedule a Mortgage Consultation

We’ll contact you with an evaluation.

100% Customer Satisfaction

Our goal is to provide 100% customer satisfaction. We do what it takes to keep our customers happy, to the best of our ability.