New Listing! 380 Calle Del Sol, Nipomo


A private and elegant Tuscan Villa Estate: Casa Encantada! Located on top of
Nipomo mesa with unobstructed panoramic views of the valley and mountains. Live
with the finest Italian and French custom furnishings and art pieces
commissioned specifically for this home. Music room boasts a Yamaha Baby Grand
piano with Symphony Pro disc player. Relax and watch movies in the
state-of-the-art media room. The fully equipped fitness center has Health Club
grade equipment. Each bedroom is decorated and furnished after an Italian city:
Bellagio, Venetian, Portofino. The sculptured gardens are hidden behind 7′ high
hedges and triple gated for privacy personified. Enjoy seven outdoor fully
furnished venues that highlight the Central Coast sunrises and sunsets. The
Meyer Lemon orchard is contracted with and to supply Frontier’s Market in San
Luis Obispo. Walk Fairy Tale Lane and you’ll land at the large stone fire pit. A
true turn-key estate home and furnishings together total $2,730,000!

New Listing! 1521 LaCita Ct., SLO


Wonderful 3 bedroom 2 bath home in San Luis Obispo. The sellers put in
approximately $100,000 in upgrades over the past two years with the intent to
stay. However, job relocations have necessitated a move. Upgrades include
beautiful walnut floors throughout; totally remodeled master bath with high-end
fixtures and cabinetry; new windows and sliding doors; updated second bath;
interior paint; and extensive landscaping. The light and airy living room
includes built in cabinets and a wood burning fireplace. . You will enjoy
relaxing in the park like backyard with a lovely garden featuring mature roses,
trees, and a new deck. The spacious trex deck is perfect for outdoor eating or
just relaxing and enjoying the view of the hills. Children’s play structure may
be included in the sale. Desirable Sinsheimer School area. This is a great
property in San Luis Obispo for under $600,000! Visit

Housing Market, Mortgage Rate Overview: Where we Stand

Welcome back from Memorial Day! We hope that your day was a relaxing one. If you missed them, our last two posts:

  • Mortgage Report: the Second Lien Makes a Comeback (May 19)
  • SLO County Real Estate Update (May 12)

This week, we will break down the housing and economic data released during the month of May.

National Home Sales & Prices

Home prices across the nation continue to rise, though the pace of their gains has slowed. Take a look at the top headline on this morning:

Home Prices Jump in March

The month of May is nearly done, but data collected from March makes the top headline.

One of the inherent difficulties in tracking the economy is simply the data lag. Headline economic numbers do not reflect conditions that are dealt with in the present day and on the ground.

What these numbers can do, however, is give us an idea about longer-term trends that might help us prognosticate where everything might be going. So what do the numbers say?


Up ArrowS&P/Case-Shiller Home Price Index (March) – Prices rose 0.8%  from the previous month, and 12.4% from the previous year. (CNBC)

Case-Shiller 20-city y:y

To the right, we have posted a screenshot of a graph published by Econoday. Prices continue to rise, but total gains have slowed a bit as demand has dipped. Higher home prices and higher mortgage rates have reduced what buyers can afford. As competition for property declines, sellers are not able to ask for quite as much.

Another limiting factor for real estate has been a shift in demographics and the rate at which households are formed.

The 2010 U.S. Census reported that the median age of marriage for men (28.2) and woman (26.1) rose. Young adults in the United States are delaying household formation – and  renting in the meantime.

So when you read Tweets like this…

… consider that the new normal is not the same as the old normal. Prices rose to a 2006 peak under a different set of conditions (available, easy credit) at a time when household formation occurred at a faster pace.


Up ArrowFHFA  Home Prices (March) – The FHFA index reported that prices rose 0.6% month-over-month and 6.6% year-over-year in March. FHFA reported a slowdown in the year-over-year gains, though 2014’s first quarter still marked the 11th-straight quarter that prices had increased (FHFA).


Up ArrowNAR Existing Home Sales (April) and U.S. Census New Home Sales (April) – Existing home sales rose 1.3% month-over-month to a seasonally adjusted annual pace of 4.65 million units. Sales were down 6.8% from April 2013 levels. Notably, available inventory jumped to 5.9 months, from 5.1 (about 6 months is considered healthy)  (National Association of Realtors).

New home sales also rose, but mostly on the strength of multifamily homes. (Bloomberg)


Mortgage Rates

Down ArrowMortgage rates have dipped over the past month. Freddie Mac’s weekly Mortgage Rate tracker placed current rates at the lowest level in seven months, with the 30-year fixed national average at 4.14%.

During the recovery, rates have typically moved at an inverse to economic outlook. When general consensus has been positive about the strength of the U.S. economic recovery, rates have increased. During periods of negativity or uncertainty, rates have improved.

So why have rates dipped, even as people generally seem to be feeling better about the economy? Rob Chrisman explains in his widely-read Daily Mortgage News & Commentary:

So why, if the economy is picking up some steam, do rates remain low? Well, it is not picking up that much steam, and the discussion among economists is centered on just how disappointing it is. Most data continue to show modest improvement but overall economic growth shows little indication of breaking out of the underwhelming trend from recent years.

Chrisman continues, speculating possible reasons for the weakness:

Blame it on the weather, on people being under-employed or dropping out of the labor force, on the Millennials not buying houses, on problems overseas, whatever. And housing is definitely not setting the world on fire: we are more than halfway through another disappointing spring selling season and we are beginning to hear more talk about new policy initiatives to boost home buying and new home construction.

At the beginning of May, we wrote about “the new normal.” Analysts continue to compare economic growth and the real estate recovery to previous economic cycles, however the underlying conditions (read: demographics) are starting to look very different. We need to figure out what “the new normal” really is, and analyze  sectors like real estate and employment on their own terms given current conditions.

As the market slows, now is a time to get creative with your home financing. As both a direct lender and a broker, Central Coast Lending has uniquely positioned itself in the industry to offer its clients home loan solutions to almost every kind of property or financial situation.


Central Coast Lending is a California mortgage broker and direct lender based on the Central Coast of California in San Luis Obispo County. Call us today at 805.543.LOAN or email to set up a free pre qualification. We are The Mortgage Experts: ask us anything!

About   ||   Mortgage FAQ   ||   Market Update Blog   ||   Radio Show   ||   Contact

New Listing! 1297 San Sorrento, Grover Beach


This charming S&S Home on one of the most sought after cul-de-sacs makes an
ideal home for raising a family or entertaining friends. Inviting open 1,544 sq.
ft., 3 bedroom 2 bath floor plan, offers large great room and master suit, with
bonus room for an office or working out. Outdoor spa is included. The great room
features high vaulted ceiling, charming wood-burning stove, glass block windows
and nice architectural wall detail. Central vacuum. The large backyard and side
patio are perfect for outdoor relaxing or children playing. There is an
oversized deluxe side-yard storage shed, and out of sight area for waste
containers. This home is move-in ready. See 1297San for more

New Listing! 11403 Cuervo Way, Atascadero


Desirable Dove Creek Home! This sought after floor plan has 3 bedrooms and 2.5
bathrooms with the large master suite on the main living level and a spacious
bonus room upstairs. The kitchen is bright and updated with Corian counter tops.
What’s more is that it is a corner lot with HOA maintained front landscape and
the largest backyard in the development. The community offers walking trails and
friendly play areas. Easy access to Hwy 101 and just minutes from SLO.

New Listing! 858 Tarragon Lane, SLO


Come and see this immaculate condo in a fantastic location! This two bedroom,
two and a half bathroom home features granite counter tops, tile and carpeted
floors, and European style viewing balconies for taking in the San Luis Obispo
mountains. It is for sale as is, and includes furniture and appliances. Close to
bike trails, Sinsheimer Park and just minutes from downtown, this affordable
condo is your chance to own a home in beautiful San Luis Obispo! Call your agent
before it’s too late!

New Listing! 2640 Ernest Place, Cambria


Over half an acre with a main house & a guest house! Large, remarkable home
all on one level. No steps. Separate one bedroom, one bathroom guest house. Main house
has two bedrooms, one office, two artist studios/craft rooms! One has access to
deck, one has two skylights, which can be popped open! Vaulted open beam ceilings
in most rooms. Spacious light, bright living room with open floor plan to dining
area and kitchen. Kitchen has lots of counter space, two pantries. Giant master
suite has vaulted ceiling, access to deck, large walk-in closet. Large guest
bedroom. Big laundry room has many storage cabinets, deep sink, built-in ironing
board, book case, desk. Central heat and an efficient wood burning stove. Large
attached garage w/direct access inside. Enclosed lanai creates extra living
space. Basement has quite a workshop complete w/220V.Guest house has vaulted
ceilings, efficiency kitchen(no stove)open to the living room, separate bedroom,3/4
bathroom, small walk-in closet. Many lovely and inviting seating areas on property.

Mortgage Report: the Second Lien makes a Comeback

By taking out a second mortgage on their home, borrowers can turn existing equity into cash to consolidate debt, fund home improvement projects, contribute to an investment home purchase, or build a secondary unit.

The second mortgage also offers owners creative solutions to financial problems. We have seen second mortgages (also called “second liens“) used to pay down first mortgages and eliminate mortgage insurance. We have seen owners use a second mortgage to keep a desirable first lien intact while cashing out equity to use for other purposes, such as college tuition.

The only problem with second liens is that they are hard to find – today, anyways.

Any questions about home loans in California? We are The Mortgage Experts: ask us anything! We have a loan program to fit every need. Call 805.543.LOAN or email us today.

“In the first quarter of 2007, there was something close to $90 billion in equity lines originated,” said Daniel Podesto, co-owner of Central Coast Lending, a mortgage lender based in San Luis Obispo County, California.

“In the first quarter of 2014, there was about 9 billion originated.”

Additional liens were common during the housing bubble – even excessively so.

“Homes were used like a credit card to purchase vacations, cars, and boats,” said Podesto. “The extra credit was easy to get. The model wasn’t sustainable.”

When the housing bubble popped loan defaults multiplied. Many second lien holders were left with nothing. Since then, lenders have been slow to offer second mortgages.

“Right now, nobody wants to be in second position,” said Podesto.

Central Coast Lending, on the other hand, offers second mortgage solutions for its clients.

[Click here to submit an online loan application or contact us to arrange a free consultation]


Types of Subordinate Financing

Subordinate financing can be structured in two ways:

1) The Piggy-Back (a.k.a.: Concurrent Lien, First and Second Combo)
Borrowers purchasing a home, are able to use a “piggy-back” their first mortgage in with a second mortgage to give them additional flexibility in the formation of their repayment plan.

2) The Standalone Second
Borrowers can also take out a second lien independent from the first. In doing so, the borrower can take cash out of their equity to use for other purposes while preserving their first lien.


Structures for Subordinate Financing

Lenders offer two structures for second liens:

1) Home Equity Line of Credit (HELOC)
The HELOC is a revolving line of credit that allows homeowners to turn home equity into cash for ready use. Some of the best uses of a HELOC allow borrowers to free up cash for debt consolidation (credit cards, car, student loans) and home improvements.

Read more about the Home Equity Line of Credit here.

2) Closed-End Second
The closed-end second lien sets a fixed interest rate and a specific payment schedule. This format offers security for borrowers with a plan that they can reliably execute.

Read more about the Closed-End Second here.


Second Liens in Today’s Market

Lenders are hesitant to issue subordinate financing due of the increased risk of being in junior position. The most recent housing bubble, for example, saw equity (and value) vanish rapidly. In foreclosure situations, lenders simply found that their second or third lien didn’t hold any value. Even the holders of the initial (first) lien were not able to recoup all of their initial loan.

Even as the housing market (and economy) has recovered, banks remain hesitant to offer subordinate financing. Central Coast Lending, however, is able to lend on an assortment of second lien situations, which can help borrowers consolidate debt, fund home renovations, or take out a new line of credit.

Give us a call at 805.543.LOAN or an email at with any questions. You can also set up a pre qualification appointment to learn about the possibilities that mortgage financing have to offer.


Central Coast Lending is a California mortgage broker and direct lender based on the Central Coast of California in San Luis Obispo County. Call us today at 805.543.LOAN or email to set up a free pre qualification. We are The Mortgage Experts: ask us anything!

About   ||   Mortgage FAQ   ||   Market Update Blog   ||   Radio Show   ||   Contact

ARTSFEST in Paso Robles, Memorial Weekend

Historic Paso Robles Park hosts local artists and their amazing work over Memorial Weekend every year. This year, the Main Event is held on Saturday, May 24th with artists onsite, producing their work live and for sale.  Also on display is an Invitational Exhibition where 20 artists will display their work. Something for everyone, there are Stilt Walkers – a amazing sort of living art display, sand castle making to participate in, hands on art projects and a petting zoo for kids, music plus food, beer and wine.  Its a lively event where Paso shows off a bit and guests get to indulge in the visual out-of-doors in addition to ‘Studios on the Park’, our fun and engaging permanent artists gallery.  There is also the Hearst Castle Art Tour and more. For more info go to