What you need to know about finding a lender for the CalSTRS 80/17
CalSTRS Home Loans October 27th, 2008The CalSTRS 80/17 home purchase loan is hands down the best loan program out there if you are an employed by or teach at any California public school or community college.
If you have already attended one of our on-line classes then you know that this loan program simply does not have enough lenders that are raving fans. My suspicion is that because CalSTRS sets the Rates and Fees for these loan programs, many lenders seem to have the attitude that it’s not worth their time to offer the CalSTRS 80/17.
We are home ownership experts specializing in California Teachers, Public employees and First Time home buyers. As a result of our on-line classes about the CalSTRS 80/17 we get to talk to a lot of home buyers that never knew this program existed.
Working with a lender that specializes in these loan programs is the very best way to make sure you don’t get caught by surprise during the process. These loans are not complicated but they are significantly different in the way they are structured.
The last thing you want is to let a lender “experiment” with your family as they try to learn about how this loan works. I am confident that there are many other lenders out there that have an expertise in this loan program, just make sure that you’re working with one.
The closing costs on a CalSTRS 80/17 are different from an FHA loan due to the fact that CalSTRS does not allow the lender to “roll in” closing costs into the interest rate. You are guaranteed by CalSTRS that the lender can not manipulate your interest rate in order for them to make more money.
The good news is that you always have full disclosure about what the rates are - the bad news is, the closing costs associated with a high loan to value loan trickle down to the bottom line of your good faith estimate. These fees are by no means exorbitant, especially when compared to an FHA loan and the Mortgage Insurance Premium (MIP) that is due both upfront and monthly.
Beware of bait and switch tactics that try to push you toward a FHA loan. This is becoming more and more common as more eligible borrowers are asking about the CalSTRS 80/17.
The “bait and switch” usually goes something like this:
- You are pre-approved for the CalSTRS 80/17 with a lender
- About two weeks into the process you are informed that the underwriting guidelines changed
- An FHA loan is presented as the solution to this challenge
What you need to know about a CalSTRS 80/17 is that the approval is automated and instant. If you have a loan approval and the rate has been locked, the underwriting guidelines can not be changed retroactively.
Get a second opinion on the GFE if you are even remotely concerned about your lender’s expertise in this program. It’s not worth the losing your deposit and possibly your dream home because the bank is trying to make a few extra bucks off you. Buyer beware always.
I’m not saying take my word for it either. But if i can help to educate you about the process and empower you with the knowledge of how these loans work, then there’s a possiblility that I can help one more family move confidently forward toward the American dream of homeownership….and I call that a good day.
If you have any questions about the CalSTRS loan program, feel free to contact us at 1-866-667-6724 or you can get more info here.
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