Santa Monica Mortgages

Written by Stephanie Dula
Bookmark and Share

Santa Monica, California offers the best of Orange County living: great shopping, fabulous entertainment, beautiful beaches, world-class restaurants and more. Many people who visit the area decide to become more than just tourists. The real estate market here is a very desirable one for both prospective residents and businesses.

How Down Payments Can Affect a Mortgage

One of the primary considerations when shopping for a home in Santa Monica is how much money will be put down up front. A lot of the major economic factors of a mortgage loan will depend on the amount of the down payment, including interest rates and amortization schedules. Those with a down payment of 20 percent or more of the loan amount generally won't have to pay for private mortgage insurance, which can be quite costly.

When reviewing a loan application, lenders like to know where the money comes from that makes up a borrower's down payment. This is called verification of assets, and its purpose is twofold: to safeguard the lending institution from fraud, and to get a better picture of the qualifications of the borrower. Borrowers with a substantial down payment that originates from savings are generally in a better bargaining position.

However, this doesn't mean one with little or no down payment will have a hard time finding a loan. Lenders are increasingly creating mortgage programs that cater to those who may be short on up-front cash, but have great credit history. Even those with bruised credit may qualify for some programs, detailed descriptions of which are available for review on the Internet.


Bookmark and Share