Investor options enable high-value purchase

Mortgage adviser: John Holmgren.

Property type: Single-family home in the Oakland hills.

Loan amount: $1.8 million.

Loan terms: 7/1 ARM; 3.625 percent with no points. Backstory: Holmgren’s selfemployed clients wanted to move from Novato to Oakland to be closer to their business. Their original price objective was in the $700,000-$900,000 range and they planned to put 20 percent down. Much of their down payment was going to come from funds in their business bank accounts because they wished to buy a new home before selling their current residence (in which they had substantial equity).

As their home search progressed, home prices were surging, resulting in an inability to find homes in their desired price range that met their needs. Thanks to the diligence of their agent, Joanna Hirsch with the Grubb Co., they found their dream home. The problem? It was priced at $1.37 million.

This higher price had several implications for their financing. First, this price combined with the 20 percent down payment put their borrowing amount over $1 million. Second, the same factors meant that their higher down payment would result in even greater use of their business assets to close the escrow. The clients had a good level of stable employment income, but one of the buyers had credit scores that were marginal for the borrowing terms that were needed.

Holmgren’s task was to find an investor who would lend 80 percent of price on a property of this price, would allow credit scores that were below the