EARNED EQUITY PROGRAM (EEP):
A NEW PATH TO HOMEOWNERSHIP

Struggling to qualify for a traditional mortgage? You may still be able to own a home and start building equity today.

WHAT IS THE EARNED EQUITY PROGRAM?

The Earned Equity Program (EEP) is designed to help individuals and families transition from renting to homeownership—even if they don’t meet traditional lending requirements.

A unique structure allows you to live in the home, build equity, and work toward full ownership over time.

KEY BENEFITS

• Low Down Payment – Starting at just 3.5%
• Flexible Credit – Scores as low as 580+
• Higher Approval Ratios – Debt-to-income up to 60%
• Self-Employed Friendly – Qualify with 3 months bank statements
• Build Equity Now – Start benefiting from homeownership immediately

WHO THIS HELPS

• First-time homebuyers
• Self-employed individuals
• Buyers with credit challenges
• Individuals with non-traditional income
• Those facing immigration-related hurdles

HOW IT WORKS

A specialized ownership structure allows you to move into a home now while building equity and positioning yourself to refinance into a traditional mortgage in the future.

Want to learn more? Click this link to view a presentation by Norma Somers, Wholesale Mortgage Account Executive at Travisa Financial.

LET’S TALK

After 42 years in the mortgage business, I can tell you—opportunities like this are rare. If you’ve been told “no” before, this may be your path forward.

For any questions don’t hesitate to call, text or email me.

Manny Kagan,
President,
Pacific Bay Financial Corporation
Your professional mortgage broker since 1983

 

EVERY CLIENT HAS THEIR OWN
UNIQUE SOLUTION

A few days ago, I received a very interesting phone call from a real estate agent I’ve known for many, many years. He opened with a simple question: “Do you do DSCR loans?” That immediately caught my attention—because we do all types of loans. So, I asked him a few more questions to understand the situation. It turns out he was thinking about buying a four-unit property for his daughter. In his mind, a DSCR loan was the solution. But as we dug deeper, the picture changed.

His daughter is employed, has income, and can actually qualify for a traditional loan, and intends to live in one of the units. In this case, she could potentially purchase the property with as little as 10% down—and likely get better terms than a DSCR loan.

So, here’s the key point: Not every situation requires a DSCR loan—sometimes a conventional approach is the better solution.

Now, DSCR loans absolutely have their place. For example, I have a client who recently inherited a property from his mother and is buying out his brother. In that case, a DSCR loan makes perfect sense—because qualification is based on the income generated by the property, not personal income.

That’s what DSCR stands for: Debt Service Coverage Ratio—a calculation based on the property’s income versus its expenses. And there are different ways to structure it depending on the scenario. So, the lesson is simple: Every situation has a solution—but the right solution depends on understanding the full picture.

One of my lenders shared this flyer with me as an illustration of my expertise. In other words, if you ever have questions, call me. I promise — I’ll help you find the right answer. 

Warm regards,

Manny Kagan,
President,
Pacific Bay Financial Corporation
Your professional mortgage broker since 1983

 

 

 

CONSTRUCTION LENDING:
EXPERIENCE COUNTS

With over 40 years in the mortgage business, we’ve developed strong expertise in construction lending—one of the more complex areas of financing.

There are several common types:

• Ground-up construction – building a home on owned or newly acquired land
• Tear-down / rebuild – demolishing an existing structure and building new
• Home improvement – renovating or expanding a property
• Completion financing – funding to finish a project already underway

Completion financing can be especially challenging. Many lenders are cautious due to risks like mechanics liens, where unpaid contractors can place liens that may take priority over the lender.

As a result, these loans often require specialized title coverage, and not all lenders will participate.

The key takeaway: we know how to navigate these challenges and have identified solutions — even in complex situations. You are kindly invited to click this link to my weekly YouTube video.

Warm regards,

Manny Kagan,
President,
Pacific Bay Financial Corporation
Your professional mortgage broker since 1983

DON’T GET PINCHED ON MARCH 17!

This past St. Patrick’s Day, my assistant Natasha came into the office and—without warning—gave me a gentle pinch. The reason? I wasn’t wearing green.

As the tradition goes, mischievous little “leprechauns” are said to pinch anyone they can see on this day. Wearing green makes you invisible to them—at least, that’s the fun legend.

What many people don’t realize is that green wasn’t always the color of St. Patrick’s Day. In fact, the original color associated with Saint Patrick was blue. The shift to green only became popular in the 19th century, likely inspired by Ireland’s lush landscape and the shamrock.

So technically, even a small touch of green—a tie, a scarf, or a little detail—might just save you from that unexpected pinch… or at least give you a good argument!

Now that the day has passed, I hope you had a wonderful time celebrating. And if you have Irish roots—or simply the spirit—you may have enjoyed it fully at one of those lively Irish pubs.

Until next year—stay lucky, stay joyful, and don’t forget your green, like people I encountered in San Francisco.

THE BENEFITS OF
TENANCY-IN-COMMON FINANCING

Tenancy in Common (TIC) financing has become popular over the years because it can offer buyers opportunities that are sometimes difficult to find with traditional condominiums.

One of the main advantages is price. In many cases, a TIC unit can be purchased for $100,000 or more below the price of a comparable condominium. In some situations, if the building is later converted into condominiums, individual units may sell for significantly higher values.

Another benefit is that many TIC properties are located in older buildings with unique architecture, charm, and desirable locations that newer condominium developments may not offer.

When clients ask me about purchasing a TIC unit, I never discourage them. However, I always recommend comparing it with condominiums as well, because financing for TIC properties is different.

TIC mortgages are usually offered by specialty lenders who provide what is called a fractional loan, meaning the loan is secured by your specific unit rather than the entire building. Because of this structure, loan terms can differ from traditional mortgages.

For example, in one of the banks, their program typically requires around 25% down payment with interest rate which depends partly on the borrower’s banking relationship and deposits with the institution.

One of our lenders offers financing up to 85% loan-to-value, allowing buyers to purchase with as little as 15% down, although the interest rate may be higher. With 20% down, terms are usually more favorable, and loan amounts may go up to $2.5 million. There is no need to keep the money in this particular bank.

 

If the client doesn’t have sufficient income to qualify for the loan mortgage, some of these programs also offer flexible qualification options, including:

• bank statement income
• profit and loss statements
• asset depletion programs

These alternatives can be very helpful for buyers who do not fit traditional income documentation guidelines.

If you are considering purchasing a property under a Tenancy in Common (TIC) structure or simply want to explore your options, feel free to contact me. I would be happy to help guide you toward the best financing strategy. Meanwhile, click this link to view my weekly YouTube video. 

Warm regards,

Manny Kagan,
President,
Pacific Bay Financial Corporation
Your professional mortgage broker since 1983

 

WHAT DOES IT TAKE
TO WRITE A BOOK?

Many people tell me, “I have a book in my head.” They share their life stories, their experiences, their wisdom. I always encourage them to write it. But an important question follows: Who is going to read it? Are we writing for ourselves, or for others?

For me, writing is self-expression. I feel like there is an artist and a writer living inside me. Some of my books are pure text; others combine words and photographs. Every book begins the same way — with an idea. Once the idea develops, it must go on paper. If it’s fiction, you create an outline and build the story step by step.

My daughter writes fiction. She spent long time working on her first novel and has now completed her second. Her approach is different from mine — from the beginning, she thinks about publishing, agents, and reaching a broad audience. That path requires persistence, connections, and patience. It’s competitive.

My approach is simpler. I write for the people I know — my friends, clients, and community. I created my own small publishing company, Encounters Publishing. My “team” is small: a graphic designer, an editor, my daughters, and my wife — my final reviewers who give me the green light.

Because of this structure, I can create freely. I’ve published three books related to the mortgage business. I’ve also produced seven photo-story books, each on a different subject. For me, creating a book is a joy. It feels like giving birth to an idea.

I just finished my latest book, “How to Enjoy a Comfortable Aging. 42 Manifestations.” It’s almost ready to be introduced to the world. The three images that you can see above, are from my new book.

If you have a book inside you and don’t know where to start, I’d be happy to share ideas and guide you.

Stay in touch.

THE RIGHT WAY TO RIGHT-SIZE

Last Sunday, I was in Oakland, visiting a property at 3990 Fairway Avenue, located not far from the beautiful Sequoyah Country Club golf course. It is a lovely, quiet neighborhood.

The home I am talking about has two bedrooms, a nice living room, and – most importantly – a wonderful covered outdoor deck, perfect for relaxing or entertaining. It’s a charming property, and there is also space on the lot with potential to build an ADU (Accessory Dwelling Unit).

I was there because the property has been recently listed by Fernando  Acosta and Gerard Guarriello. They asked me to prepare a flyer explaining how this home could potentially be purchased with only 5% down. Yes, it is possible. With a realistic interest rate and an income of around $200,000, a buyer may qualify with 5% down. Of course, you can always put more down if you wish.

This home could be especially attractive for right-sizing—for example, if you currently live in a larger house with many stairs and are looking for a simpler, more comfortable lifestyle.

Please click this link to view the video I took there. If you are considering something like this, give me a call: (415) 225-7920. I’ll be happy to help you understand how to structure the purchase and arrange the financing if needed.

Best wishes,

Manny Kagan,
President,
Pacific Bay Financial Corporation
Your professional mortgage broker since 1983