California Teachers and Employees

As a member of CalPERS, you may be eligible to take out a personal loan against your retirement account for the purposes of purchasing a new home.

As tightening underwriting guidelines and mortgage insurance company restrictions have all but disabled the CalPERS loan program, the personal loan option survives as a saving grace.

If you are an employee of a California Public School or Community College you may be eligible to use a CalSTRS 80/17 home purchase program to buy your home.  This program only requires a 3% down payment.

If you are a CalPERS member and not working in the education field, FHA offers a low 3.5% down payment option for the purchase of an owner occupied home.

In either case, you have the ability to take out a personal loan which is not secured by the the property as a second or third mortgage or silent mortgage, but is secured by your CalPERS retirement account.

By taking advantage of this program you will not be taking money out of your retirement account, but only using it as security for the personal loan.

Personal loan highlights:

• Can borrow up to 50% of contributed balance
• Maximum loan amount is $18,421
• Loan terms up to 15 years
• Can be used for down payment or closing costs

For complete personal loan guidelines click here

For more information about this financing option, the CalSTRS 80/17 or other home buyer programs - you are invited to attend one of our no cost on-line web classes covering these programs and more.

Click here for a complete schedule of upcoming online home buyer education classes

Click here for tools and resources from past online home buyer education classes

The 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.

This is a very telling article I ran accross today.  MercuryNews.com out of Silicon Valley featured this article today - Southern California home sales jump 65% in September.

What struck me as the most telling statistic from this story is the fact that the median home price in the six county region dropped 33.2% from $462,000 to $308,000.

The Southern California region they are referring to include Riverside, San Bernardino and San Diego counties which were some of the hardest his areas of mortgage fraud and ultimately is also among the nationwide leaders in foreclosures and short sales.

This is another testament of the fact that this is an incredible buyer’s market for those that qualify for home loan financing.

For a more information about the Affordability Index and Median Home Prices in California, join us for one of our informative web classes.  All of the classes currently scheduled discuss the CalSTRS 80/17 home purchase program in detail as well as reviewing Median Home Prices and the Affordability Index.

Click here to Register for one of these Web Classes

Ok, it’s come to the point where I can no longer brush this off as a coincidence.  The conversation that I am having over and over again goes something like this…..

“Hi Scott, I am in the process of buying a home and was qualified for a Teacher loan (Extra Credit Teacher Program or CalSTRS 80/17) and my loan officer just told me that the underwriting guidelines have changed and I no longer qualify for this program.

I was doing some research on the internet and ran across your blog.  Have there been any changes?  I can’t seem to find anything to back up what i’m being told by my loan officer.  Please help!”

This is not an actual conversation ver batim but I assure you it’s really, really close!

Here’s what the “other guys” don’t want to tell you - They don’t like to offer these loans because…ok, brace yourself…….drum roll please……..They don’t make a lot of money giving you one of these special loans.

Can you believe it?  I know you’re shocked that a loan officer or lender would actually ignore the best interest of their client just to make more money for themselves……Come on Scott, that doesn’t happen.

I know I sound a little irritated and even bordering on hostile as I write this and I guess it’s because I am.

I sincerely hope that you have run across this post because you didn’t take “no” for an answer.  I want you to know that although there are often changes in loan qualification guidelines, there have been relatively few changes in these programs.

The reason why there is little information out there about these programs is that lenders and loan officers are not eager to work for a reasonable wage and help a segment of our community that quite frankley does not get enough credit for the contributions you make to society.

Ok, I feel a little better now that I’ve gotten this off my chest.  I’ve put together a bunch of resources for you and we hold free web classes regularly to educate teachers, public employees and first time home buyers about these special programs.

Click Here for these valuable resources

There are links all over this site to contact us for more information or you can call my cell phone anytime.  I can be reached at 714-336-8286.  The office number is 866-667-6724 and anyone here will give you an honest answer and look out for your best interest.

The conservatorship forced upon fannie mae and freddie mac by the U.S. Treasury department has spawned an industry wide  trend of dropping interest rates.  Government loans and Conventional loans alike have experienced similar slides since Monday.

Interest Rates have dropped below 6% in the first time in a very long time - you can check CalSTRS interest rates on their website anytime - Here is a link to the CalSTRS Interest Rates page

One of my favorite features of the CalSTRS 80/17 home purchase program is the one time free float down.  What this means is that after you have locked your interest rate, once you are in escrow, and the interest rates drops as they did this week, you are allowed to reduce the rate at no charge.

This program just keeps getting better and better if you’re a Teacher or Employee at a California public school or community college.  If you would like more information about this program give us a call today at 1-866-667-6724.

Every day seems to bring new challenges for new home buyers looking to purchase homes in the State of California.  As home prices drop to seemingly jaw dropping levels California Teachers and Public Employees are making up a large percentage of first time home buyers entering this market.

If you do not belong to special organization like CalSTRS or CalPERS there are still programs available to purchase with little or no money down, but not nearly the options available to members of these organizations.

CalSTRS made a startling announcement earlier this week that it have successfully defended an important underwriting guideline with Fannie Mae that has resulted in many more California Teachers and Employees being able to qualify for the 80/17 loan program.

There is no program available anywhere in the State or Country that has the benefits of this loan program.  No mortgage insurance, low interest rates, low fees, deferred payments on down payment for 5 years - Inquire here for more information on this program.

CalHFA still offers great programs to first time home buyers, and specifically to Teachers working in high priority (title 1) schools in the State of California.  The Extra Credit Teacher program provides a 3% silent second mortgage with no payments due for the life of the first loan.  Teachers that qualify for this loan program may have to come in with as much as 2% down payment, but as little as nothing down with the use of other down payment assistance programs available through CalHFA and it’s affiliate DPA program.  Inquire here for more information on this program.

CalPERS offers a loan program that allows you to borrow up to 95% loan to value plus take a personal loan of up to $18,000 or half of your CalPERS value to cover the additional 5%.  The result is that you can borrow up to 100% of the purchase price.  Inquire here for more information on this program.

For more information on any of these programs feel free to call us at 866-667-6724 or Inquire here for more information.  To find out if you qualify for a low or no down payment home loan you can also complete this simple, online loan application and get approved today!

The major mortgage insurance companies announced on Friday, August 8th, 2008 that they will no longer offer mortgage insurance on any loans that exceed a total of 90% loan to value in California, Arizona, Nevada and Florida.

The only options left for “low down payment” purchase loans in California are FHA, CalHFA Extra Credit Teacher Program and the CalSTRS 80/17 home purchase loan.

It’s really a no brainer once you compare these loans side by side:

CalSTRS compared to CalHFA

• You do not have to be a first time home buyer with CalSTRS
• There are no income limits with CalSTRS
• CalHFA currently has an interest of 6.25%, CalSTRS 6.625%
• CalSTRS does not require Mortgage Insurance - CalHFA does

CalSTRS compared to FHA

• No mortgage insurance with a CalSTRS loan
• No upfront PMI with CalSTRS
• Both require only 3% down payment

This, in my opinion continues to be the best loan option available…PERIOD.

Did you know that the only requirement is that you have a pay stub from a Calfornia Public School or Community College?  You do not even have to be a member of CalSTRS.

I am holding California Teacher Home Buying Workshops for any schools or organizations in California.  I will be in San Deigo next week.  If you would like to hold a workshop at your school or other forum, feel free to contact me for details.

You may reach me on my cell phone at 714-336-8286 or email me at Scott@MyPorchLight.com

CalSTRS Homebuyer Education Class

80/17 Purchase Loan - No PMI FHA alternative

95/5 Purchase Loan - No money down - Program Suspended 6/24/08

Introduction to CalSTRS Home Loan Program

CalSTRS Conventional Home Loans - Cash Out & Rate and Term Refinance

Check your Home’s Current Value Here

I just received this question and thought it was important enough to address it so that everyone could get more information about how this works.

CalSTRS is the California State Teachers Retirement Program providing retirement related benefits to teachers in public schools and Community Colleges in the State of California. Facts about CalSTRS:

• Largest U.S. Teachers Retirement Fund
• 2nd Largest U.S. Public Pension Fund
• CalSTRS assets stands at $164 Billion as of March 31, 2008
• CalSTRS membership stands at 795,000

The CalSTRS Home Loan Program was established in 1984 as a result of legislation that provided CalSTRS with a mortgage-backed security investment opportunity and restructured in July of 2004. It was designed as an additional source of home financing for its members and retirees giving them a great choice of mortage loans with competitive rates.

How this program benefits you: Borrowers can obtain a great loan with a competitive rate - and your money works for you since income derived from mortgage payments goes directly into the Teachers’ Retirement Fund.

Program Highlights

Program Summary: This loan program is available for the Purchase of a Home, Rate and Term Refinance or Cash Out Refinance. This loan provides for a first mortgage of up to 95% of the value of the home (90% in declining markets)

Term: 15 or 30 Year term

CalSTRS Interest Rates: Check Today’s Rates Here

Conforming Loan Amount: Up to $417,000

Non Conforming Loan Amount: $417,001 to $834,000

Max Loan to Value (LTV) - 1st: 95% (90% in declining markets)

Max Combined Loan to Value (CLTV): 95%

Loan Purpose: Purchase, Rate and Term Refinance, Cash Out Refinance

Eligible Properties: Single Family Residence, 2 - 4 Units, Condominiums, Planned Urban Developments (PUD)

Sources of Closing Costs: Borrower’s own funds, seller contributions up to 3%, gift from relative, equity in home.

Own Other Properties: Borrower can own other properties but only 1 CalSTRS mortgage at a time.

Minimum Credit Scores: 620 Minimum Credit Score - NOTE: There are Pricing adjustments based on Loan to Value, Credit Score, Purpose of Loan and Number of Units that will appear as Loan Charges on your Good Faith Estimate.

Because CalSTRS sets all interest rates, these fees can not be included in the rate as other conventional loan programs do. Rate and Term Refinances on SFR, Condo, PUD properties with a Credit Score over 720 have no pricing adjustments up to 95% LTV.

Counties Eligible: Alameda, Amador, Butte, Calaveras, Colusa, Contra Costa, Del Norte, El Dorado, Fresno, Glenn, Humboldt, Imperial, Inyo, Kern, Kings, Lake, Lassen, Los Angeles, Madera, Marin, Mendocino, Merced, Modoc, Mono, Monterey, Napa, Nevada, Orange, Placer, Plumas, Riverside, Sacramento, San Benito, San Bernardino, San Diego, San Francisco, San Joaquin, San Luis Obispo, San Mateo, Santa Clara, Santa Barbara, Santa Clara, Santa Cruz, Shasta, Sierra, Siskiyou, Solano, Sonoma, Stanislaus, Sutter, Tehama, Tulare, Tuolumne, Ventura, Yolo, Yuba

Cities Eligible: Adelanto, Agoura Hills, Alameda, Albany, Alhambra, Aliso Viejo, Alturas, Amador City, American Canyon, Anaheim, Anderson, Angels Camp, Antioch, Apple Valley , Arcadia, Arcata, Arroyo Grande, Artesia, Arvin, Atascadero, Atherton , Atwater, Auburn, Avalon, Avenal, Azusa, Bakersfield, Baldwin Park, Banning, Barstow, Beaumont, Bell Gardens, Bell, Bellflower, Belmont, Belvedere, Benicia, Berkeley, Beverly Hills, Big Bear Lake, Biggs, Bishop, Blue Lake, Blythe, Bradbury, Brawley, Brea, Brentwood, Brisbane, Buellton, Buena Park, Burbank, Burlingame, Calabasas, Calexico, California City, Calimesa, Calipatria, Calistoga, Camarillo, Campbell, Canyon Lake, Capitola, Carlsbad, Carmel-by-the-Sea, Carpinteria, Carson, Cathedral City, Ceres, Cerritos, Chico, Chino Hills, Chino, Chowchilla, Chula Vista, Citrus Heights, City of Commerce, City of Industry, Claremont, Clayton, Clearlake, Cloverdale, Clovis, Coachella, Coalinga, Colfax, Colma , Colton, Colusa, Compton, Concord, Corcoran, Corning, Corona, Coronado, Corte Madera , Costa Mesa, Cotati, Covina, Crescent City, Cudahy, Culver City, Cupertino, Cypress, Daly City, Dana Point, Danville , Davis, Del Mar, Del Rey Oaks, Delano, Desert Hot Springs, Diamond Bar, Dinuba, Dixon, Dorris, Dos Palos, Downey, Duarte, Dublin, Dunsmuir, East Palo Alto, El Cajon, El Centro, El Cerrito, El Monte, El Segundo, Elk Grove, Emeryville, Encinitas, Escalon, Escondido, Etna, Eureka, Exeter, Fairfax , Fairfield, Farmersville, Ferndale, Fillmore, Firebaugh, Folsom, Fontana, Fort Bragg, Fort Jones, Fortuna, Foster City, Fountain Valley, Fowler, Fremont, Fresno, Fullerton, Galt, Garden Grove, Gardena, Gilroy, Glendale, Glendora, Goleta, Gonzales, Grand Terrace, Grass Valley, Greenfield, Gridley, Grover Beach, Guadalupe, Gustine, Half Moon Bay, Hanford, Hawaiian Gardens, Hawthorne, Hayward, Healdsburg, Hemet, Hercules, Hermosa Beach, Hesperia, Hidden Hills, Highland, Hillsborough , Hollister, Holtville, Hughson, Huntington Beach, Huntington Park, Huron, Imperial Beach, Imperial, Indian Wells, Indio, Inglewood, Ione, Irvine, Irwindale, Isleton, Jackson, Kerman, King City, Kingsburg, La Cañada Flintridge, La Habra Heights, La Habra, La Mesa, La Mirada, La Palma, La Puente, La Quinta, La Verne, Lafayette, Laguna Beach, Laguna Hills, Laguna Niguel, Laguna Woods, Lake Elsinore, Lake Forest, Lakeport, Lakewood, Lancaster, Larkspur, Lathrop, Lawndale, Lemon Grove, Lemoore, Lincoln, Lindsay, Live Oak, Livermore, Livingston, Lodi, Loma Linda, Lomita, Lompoc, Long Beach, Loomis , Los Alamitos, Los Altos Hills , Los Altos, Los Angeles, Los Banos, Los Gatos , Loyalton, Lynwood, Madera, Malibu, Mammoth Lakes , Manhattan Beach, Manteca, Maricopa, Marina, Martinez, Marysville, Maywood, McFarland, Mendota, Menifee, Menlo Park, Merced, Mill Valley, Millbrae, Milpitas, Mission Viejo, Modesto, Monrovia, Montague, Montclair, Monte Sereno, Montebello, Monterey Park, Monterey, Moorpark, Moraga , Moreno Valley, Morgan Hill, Morro Bay, Mount Shasta, Mountain View, Murrieta, Napa, National City, Needles, Nevada City, Newark, Newman, Newport Beach, Norco, Norwalk, Novato, Oakdale, Oakland, Oakley, Oceanside, Ojai, Ontario, Orange Cove, Orange, Orinda, Orland, Oroville, Oxnard, Pacific Grove, Pacifica, Palm Desert, Palm Springs, Palmdale, Palo Alto, Palos Verdes Estates, Paradise , Paramount, Parlier, Pasadena, Paso Robles, Patterson, Perris, Petaluma, Pico Rivera, Piedmont, Pinole, Pismo Beach, Pittsburg, Placentia, Placerville, Pleasant Hill, Pleasanton, Plymouth, Point Arena, Pomona, Port Hueneme, Porterville, Portola Valley , Portola, Poway, Rancho Cordova, Rancho Cucamonga, Rancho Mirage, Rancho Palos Verdes, Rancho Santa Margarita, Red Bluff, Redding, Redlands, Redondo Beach, Redwood City, Reedley, Rialto, Richmond, Ridgecrest, Rio Dell, Rio Vista, Ripon, Riverbank, Riverside, Rocklin, Rohnert Park, Rolling Hills Estates, Rolling Hills, Rosemead, Roseville, Ross , Sacramento, Salinas, San Anselmo , San Bernardino, San Bruno, San Carlos, San Clemente, San Diego, San Dimas, San Fernando, San Francisco, San Gabriel, San Jacinto, San Joaquin, San Jose, San Juan Bautista, San Juan Capistrano, San Leandro, San Luis Obispo, San Marcos, San Marino, San Mateo, San Pablo, San Rafael, San Ramon, Sand City, Sanger, Santa Ana, Santa Barbara, Santa Clara, Santa Clarita, Santa Cruz, Santa Fe Springs, Santa Maria, Santa Monica, Santa Paula, Santa Rosa, Santee, Saratoga, Sausalito, Scotts Valley, Seal Beach, Seaside, Sebastopol, Selma, Shafter, Shasta Lake, Sierra Madre, Signal Hill, Simi Valley, Solana Beach, Soledad, Solvang, Sonoma, Sonora, South El Monte, South Gate, South Lake Tahoe, South Pasadena, South San Francisco, St. Helena, Stanton, Stockton, Suisun City, Sunnyvale, Susanville, Sutter Creek, Taft, Tehachapi, Tehama, Temecula, Temple City, Thousand Oaks, Tiburon , Torrance, Tracy, Trinidad, Truckee , Tulare, Tulelake, Turlock, Tustin, Twentynine Palms, Ukiah, Union City, Upland, Vacaville, Vallejo, Ventura, Vernon, Victorville, Villa Park, Visalia, Vista, Walnut Creek, Walnut, Wasco, Waterford, Watsonville, Weed, West Covina, West Hollywood, West Sacramento, Westlake Village, Westminster, Westmorland, Wheatland, Whittier, Williams, Willits, Willows, Windsor , Winters, Woodlake, Woodland, Woodside , Yorba Linda, Yountville , Yreka, Yuba City, Yucaipa, Yucca Valley