Our client was under contract to purchase a new home for $6.2 million in Laguna Beach, California. A well-respected surgeon based in Beverly Hills, he wanted to move his family to a larger home.
He initially applied for a mortgage loan with his bank, a major national banking institution. However, his bank had tightened its guidelines and no longer offered super jumbo loan amounts. He faced similar roadblocks at other large banks. That’s when he reached out to us.
There were two obstacles to overcome.
First, our client wanted a down payment no higher than 20%. This is difficult to find for super jumbo loans. Typically, for a down payment of 20%, the maximum loan amount allowed is $3 million. In fact, his bank told him the highest loan amount they could offer was $3 million, which was nearly $2 million short of the $4.96 million he was seeking.
Second, as a self-employed surgeon, our client had complex income tax returns. While his year-over-year income showed growth, his bank used traditional underwriting guidelines that gave his prior-year earnings more weight, reducing his qualifying income.
After analyzing two years of his tax returns and profit-and-loss statements, we connected our client with a private bank known for its risk appetite for super jumbo loan amounts at high LTVs.
Unlike the borrower’s conservative bank, this private bank offers super jumbo loan amounts up to $7.5 million up to 80% LTV, up to $10 million up to 70% LTV, and up to $15 million up to 65% LTV.
Our client fit nicely in the first bucket, and he was approved for $4.96 million at 80% LTV.
As a condition of getting the loan, the bank required our client to open an account and enter into a depository relationship with them.
After going through a streamlined underwriting process where only 1 appraisal was required, the bank issued its clear to close in only 15 business days.
Most importantly, our client achieved his goal of a down payment no higher than 20%. While his bank would have capped him at a $3 million loan amount, we obtained nearly $2 million more for him.
His interest rate was competitive and he chose an adjustable-rate mortgage, amortized over 30 years, with the rate fixed for the first 10 years.
Our client and his family look forward to enjoying their new home overlooking the sparkling Emerald Bay and breathtaking Pacific Coast Highway.
This transaction highlights what’s possible with the right execution. Learn more about super jumbo loans in California and how complex purchases are approved.
DAK Mortgage is a licensed mortgage broker that can navigate you through the process of finding the right loan for your needs.
