What Buyers are Really Asking; Divorce & Life Transitions

Every week I spend time researching the questions buyers are asking Google and ChatGPT before they ever contact a Realtor or lender. My goal is to keep you informed about what your clients are thinking—and to help you answer their questions with confidence.

This Week's Focus: Divorce & Life Transitions

Divorce is one of life's most challenging transitions, and for many people, their home is their largest asset. Unfortunately, one of the biggest mistakes I see is waiting until the divorce is finalized before discussing mortgage financing.

By then, some opportunities may already have been lost.

Here are some of the questions borrowers are asking AI this week:

"Can I keep the house after my divorce?"

Possibly—but the answer depends on much more than simply wanting to keep it.

Can the remaining spouse qualify on their own? Will support income be received, and can it be used for qualification? Is refinancing necessary? These questions should be addressed early in the process, not after the settlement agreement has been signed.

"Does the divorce decree remove me from the mortgage?"

No.

A divorce decree determines who is responsible for the home as part of the legal settlement, but it does not automatically remove a borrower from the mortgage loan. In many cases, refinancing or another approved solution is needed before one spouse is released from liability.  However, this loan will not be considered for the spouse who is  not responsible for the loan, when purchasing a new home.

"Can support income help me qualify?"

Often, yes.

Depending on the loan program and documentation, alimony or child support income may be considered for qualification. The timing, documentation, and history of those payments can make a significant difference.  Typically six months of receipt is required in order to use it.

"Can I buy another home before my divorce is final?"

Sometimes.

Every situation is unique. Factors such as qualifying income, existing mortgage obligations, the terms of the separation agreement, and available assets all play an important role. This is one reason it's so valuable to begin planning early.  I’ve handled these situations before, and so long as there is a court approved property division agreement, it is possible.

Karen's Loan Desk

One of the most rewarding parts of my job is helping clients through major life transitions.

I've worked with many individuals before, during, and after a divorce. While every situation is different, I've learned that the earlier we have the mortgage conversation, the more options we usually have.

Sometimes it's not about finding a loan—it's about creating a strategy that supports the best possible outcome for everyone involved.

The takeaway?

Don't wait until the divorce is final to discuss financing. A conversation early in the process can help avoid surprises and preserve valuable options.

AI Prompt of the Week for Realtors

One of the best ways to use ChatGPT is to communicate with empathy while providing helpful information. Copy and paste this prompt:

Act as an experienced Orange County Realtor. Write a compassionate email to someone going through a divorce who may be concerned about their housing options. The email should be reassuring, educational, and non-salesy. Explain why it's important to speak with a mortgage professional early in the process to understand financing options before major decisions are finalized. End with a gentle invitation to ask questions. Keep it under 300 words.

Realtor Tip of the Week

If you have clients navigating a divorce, separation, or another major life transition, let's have a conversation before the property is listed, refinanced, or awarded in the settlement.

A simple planning session can help answer important questions, identify potential challenges, and give your clients greater confidence as they move forward.

As always, I'm happy to review any scenario, answer questions, or help develop a financing strategy that best serves your clients.

Have a wonderful weekend!

 Karen and the Card Team

Longer Days and Sunshine: It's Summer!

The longest day of the year is almost upon us. It's my favorite time of year—the sunshine, warm weather, and longer evenings spent outdoors. Of course, it's also the beginning of the gradual march toward shorter days. ☹

The kids are out of school and fully immersed in summer activities. My grandkids are keeping busy with everything from sailing, Junior Guards, and swimming to baseball camp, theater programs, and dance camps. Summer in Southern California really is a special time of year.  I'm keeping busy with home buyers and refiances, with a little vacation sprinkled in!  I'll update you next month....

RATE UPDATE

Mortgage rates have remained relatively stable over the past several months despite ongoing economic uncertainty. Inflation appears to be moderating, but global events, geopolitical tensions, energy prices, and government policy continue to create volatility in the financial markets.

While no one can accurately predict where rates will be six months from now, most analysts expect rates to remain within a relatively narrow range through the balance of the year. If you're considering purchasing a home or refinancing, it may make more sense to focus on whether the move benefits your financial goals rather than trying to perfectly time the market.

REAL ESTATE MARKET

The Orange County housing market appears to be moving toward a more balanced environment, with some areas beginning to favor buyers. Inventory has increased from the extremely low levels we've experienced over the past few years, giving buyers more choices and negotiating power.

We're seeing more sellers offer concessions, including interest rate buydowns, credits toward closing costs, repair allowances, and other incentives to help facilitate a sale.

While median home prices in Orange County remain strong, it's important to note that a significant number of luxury and multi-million-dollar transactions have helped support those statistics. In many neighborhoods, price appreciation has slowed and homes are taking a bit longer to sell than they did during the frenzy of recent years.

CREDIT SCORES & MORTGAGE QUALIFYING

Many consumers are surprised to learn there isn't just one credit score. Different industries use different scoring models. Auto lenders, credit card companies, insurance providers, and mortgage lenders may all evaluate credit differently.

The mortgage industry is preparing to transition to newer credit scoring models that may provide a more complete picture of a borrower's creditworthiness. This could be particularly helpful for borrowers who have limited traditional credit histories but have otherwise demonstrated responsible financial habits.

If you're curious about your credit profile or wondering how today's scoring models affect your ability to qualify, I'd be happy to review your situation.

HELOCs ARE MAKING A COMEBACK

We're helping more homeowners access their equity through Home Equity Lines of Credit (HELOCs). Homeowners today are sitting on record amounts of equity, and many are using HELOCs strategically for:

• Home improvements and renovations
• Debt consolidation
• Down payments on second homes or investment properties
• Educational expenses
• Emergency reserves and financial flexibility

A HELOC isn't right for everyone, but it can be an excellent financial tool when used appropriately.

CALIFORNIA INSURANCE UPDATE

Homeowners insurance continues to be a challenge throughout California. Many homeowners have experienced premium increases, policy non-renewals, or difficulty finding coverage altogether. Areas with wildfire exposure have been particularly affected, but the impact is being felt across much of the state.

The good news is that new insurance carriers are beginning to re-enter the California market, creating additional options for homeowners. While premiums remain higher than many of us would like, there are often alternatives available that can help reduce costs or improve coverage.

If you have questions about your current insurance situation, are purchasing a home, or simply want a second opinion on your coverage options, I have relationships with several excellent insurance professionals and would be happy to connect you with someone who can help.

SUMMER FUN ALONG THE COAST

Summer is officially in full swing along the Southern California coast. From outdoor concerts and movies in the park to festivals, farmers markets, harbor events, and beach activities, there's no shortage of things to do from Seal Beach to San Clemente.

If you're looking for ideas for family activities, date nights, local events, or hidden gems around Orange County, reach out. I'm always happy to share some of my favorites.

As always, thank you for your trust, referrals, and friendship. If you have questions about the market, mortgage financing, or your home's value, I'm just a phone call away.

Have a wonderful summer!

Karen Card

Summer is Over? Say It Ain't So!

 Although the kids are back in school, it still feels like summer here in Dana Point! We’ve been blessed with incredible weather all season long. I still remember one summer when the sun never came out—just marine layer and cold. This year has been the opposite!

One of our highlights was snorkeling in Laguna and taking advantage of the warmer ocean temps. We saw so much sea life! My favorite? The baby leopard sharks cruising around—so cool.

I hope your summer has been filled with fun and good memories, too!

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What’s Up with Rates?

Good news—interest rates are finally creeping down, with some mortgage rates hovering around 6% today. That’s a big improvement from six months ago!

Once we see a more significant drop, the real estate market could take off like a rocket. Buyers have been sitting on the sidelines while inventory has been slowly building. When confidence returns, it could feel like a tsunami of activity!

Quick note: The Fed rate impacts mortgage rates, but not directly.

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Home Prices?

For now, prices seem to be leveling off. No major gains lately, mainly because of two factors:

✔ Inventory is up
✔ Buyers are cautious with rates still higher than they’d like

Affordability remains a challenge, even as rates ease a bit.

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Buy Before You Sell!

Think you need to sell your current home before buying your next one? Think again!

This unique market has sparked some great “bridge loan” programs that allow you to buy first by tapping the equity in your current home—even before you sell it.

In some cases, the lender even guarantees to buy your current home if it doesn’t sell quickly (using your agent, of course!). Most programs also don’t count your current mortgage payment against you when qualifying for the new loan. Huge advantage!

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2-1 Buydowns

This is one of my favorite strategies right now. A 2-1 buydown allows the seller to pay to temporarily reduce your interest rate, making the payment more affordable upfront:

1. Year 1: 2% below the current market rate
2. Year 2: 1% below market
3. Year 3+: Back to the original rate

And here’s the best part: if you refinance early, you get back the unused portion of the buydown funds!

Why would a seller pay for this? Because they want to sell—and often, the cost can be built right into the purchase price.

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Market Snapshot: Orange County Real Estate

Here’s a quick look at what’s happening right now in our local market:

1. Median Sales Price: Homes in Orange County sold for around $1.19 million in July 2025, up about 1.1% year-over-year.Redfin
2. Days on Market: Homes are spending longer on the market—about 53 days, up from 31 days last year.Redfin
3. Average Home Value & Time to Pending: Zillow reports an average home value of $1,171,609, up 2.1% year-over-year, with homes going pending in roughly 20 days.Zillow
4. Inventory & Competition: With inventory slowly climbing and mortgage rates easing, the market is showing signs of steadiness and renewed buyer interest.

In short: prices are holding steady or inching up, but homes are staying on the market longer—making it a balanced market with opportunity for both sellers and buyers.

Let’s Chat—Here’s What You Can Do Next

Whether you're planning to sell, buy, or just want to understand how these trends affect your home goals, let’s talk one-on-one. I’d love to offer a complimentary Strategy Session tailored to your situation—no strings attached.

Ready? Here's your next step:

1. Reply to this email or call/text me at 714-290-6940
2. Let me know if you’d like to:
1. Review how these trends may impact your home’s value
2. Explore bridge loan and 2-1 buydown options
3. Discuss timing your next move in today’s market

Thanks for reading—I always enjoy keeping you in the loop. When the market shifts, you’ll be ready to ride the wave!

FICO SCORING SECRETS & MARKET UPDATES

Market Update

More Inventory, and even more buyers!!!

The spring selling season is here!  The seller’s market continues with demand outpacing inventory.  And, prices continue to rise despite stubborn interest rates. We are seeing more competitive bidding again for many homes.  In order to stand out, buyers must be fully pre-approved and ready to act swiftly.

Rates are high compared to the pandemic period, but are still running close to historical averages.  Expert guidance is key to navigating the mortgage process, especially for first time homebuyers.  Be sure to work with a knowledgeable and experienced lender to streamline the process and ensure a successful close.

Here is the current conundrum regarding rates:  Prices are high, CPI is high, and inflation is higher than the Fed wants.  The Feds will apparently only reduce rates when CPI falls.  Which will only happen when home price appreciation cools.  Which will only happen when there is a sustained increase in housing inventory.  Which will only happen when rates fall.  And, back to the beginning.

 

FICO SCORE HELPFUL HINTS

When planning for a home loan, whether a purchase or a refinance, it is paramount to understand the factors that influence your FICO score.  And, remember there are different scoring models. Clients may tell me what their FICO score is, but when I pull a Tri-Merge from Experian, Transunion and Equifax, which is required for a mortgage loan, the scores are quite different. 

1.      Payment History – Late payments, especially on any mortgage are a critical negative factor.

2.      Credit Utilization – Keep balances to less than 30% of credit available; this is typically the most common issue affecting FICO scores we see

3.      Length of Credit history – the longer you have had credit, the better.  And, being added as an Authorized User to a relative’s long-standing account may help, check with us first!

4.      Credit mix – Installment loans (auto loans) or leases help your score when coupled with revolving credit. And, have at least two or three revolving credit accounts.

5.      Inquiries – typically these have the least effect on your score although consumers believe otherwise.

We frequently work with clients to assist them with credit repair.  Here are some of the most common questions we hear:

1.      Should I pay off my credit cards and/or car loan?  Not necessarily, unless they are affecting your debt-to-income ratio.  You don’t need to be debt-free to qualify for a home loan.  And sometimes it is best to have a small balance on some accounts.

2.      Should I close my credit cards that I don’t use anymore?  After all, I’ve paid them off.  NO!  This will have a negative effect on your FICO score.  The more unused credit you have, the better!!!! Never close an account.

3.      Can I apply for a car loan at a number of places to find the best rate?  NO!  Too many inquiries at one time will temporarily drop your score.

Always discuss any possible changes to your credit cards or loans with your loan officer first.

We are here to help and be your resource!

Karen, Katie and Stephanie

ADVERSITY, OPPORTUNITY AND FAST CASH!

 

MARKET UPDATE - ADVERSITY

The latest news for multi-family housing is developers have slowed/stopped new construction.  This is primarily due to higher interest rates coupled with greater difficulty qualifying for loans.  This will translate into higher rents, particularly in the coastal areas of California where housing is already in short supply and high demand.

Translation:  Prospective buyers should not wait for rates or prices to come down, as neither is likely in the next 12 months.  No one anticipates home values to decrease.

OPPORTUNITIES

We are offering a personal loan program – NOT a Mortgage loan – for auto loans, remodels, swimming pools, debt consolidation, recreation and more.  This is not recorded on your home and has no effect on the low rate first mortgage most of our clients have. The turn time on these loans is extremely short, even overnight, and offers a quick and easy way to access fast cash.

Loan amounts can vary from $5,000 to $100,000.  Loans are underwritten based on income, assets, and credit.  The process is completely digital and there are no up-front fees or prepayment penalties.

Click here for the link to a quick qualification process:  Personal Loan Link

REMINDERS

Real estate taxes are coming due, and must be paid by December 10^th to avoid penalties  The second half taxes are due by April 10th.  Such great timing for Christmas and tax time, huh?

Self-employed borrowers should have their taxes reviewed by us prior to filing if they are considering making a home purchase or refinance in the next two years.  Writing off too many expenses can kill a home purchase or refi, unless you want to use a bank statement loan which carries a higher rate.

PERSONAL UPDATES

I’m writing this from Madera (just north of Fresno)  where I am temporarily staying with my sister who suffered a stroke.  My sister lives alone and we were extremely lucky her daughter sounded the alarm when she could not contact her one morning. 

She is improving daily, and we expect a full recovery.  This has been a big wakeup call and reminder to be grateful every day, keep your loved ones close, always do your best and be kind to all.  And, take good care of your health.

As always, call us with any questions or concerns.

 

SUMMER FINALLY ARRIVES FOR THE 4TH!

We hope everyone had a Happy and Safe 4^th of July!  Ours was eventful with visiting children, Water Wars in the Harbor, and a traditional barbeque crowned by the fireworks in Dana Point.

INTEREST RATES

Interest rates have risen to recent highs, due to continued new job growth, dropping unemployment, and the Fed’s news that they will yet again raise rates to slow inflation further.  Although inflation has lowered to 4%, it has not yet hit the desired target of 2 to 3%. 

Most economists do expect rates to come down in the next six months, but they are not expecting as steep a drop as before.  Our advice is to prepare for the “new normal.”    Once rates stabilize, we will likely see rates in the 5’s for some time.

MARKET UPDATE

Home prices are very slightly off their highs of last May.  Orange county still has a $1 million median price, down from $1.05 million, while LA county has a median of $800K, down from the $860K high a year ago.  And, homes are again selling over list price!

The biggest issue continues to be a very low sales volume, which can primarily be attributed to the paucity of listings.  Of course, interest rates play into the volume of sales, but there are so few listings there is little downward pressure on home prices, if any.

MOVING OUT OF STATE?

We are part of a large network of loan officers licensed in all states in the country, save New York.  We can assist our clients with financing when moving or buying a second home out of the state of California.

The most common states to move to?  Nevada, Arizona, Oregon, Idaho, and Texas.  Lower taxes seem to be a large part of the equation!  There is also a migration out of cities and into suburban or rural environments.

THIS AND THAT

We continued our holiday celebration last Wednesday with a pool party with dear friends.  It was lovely weather for the pool, and even better times with old friends!  And, my sister joined me for a long weekend to visit and attend the art festivals in Laguna!  She is a new member of the Madera County Grand Jury.  Pretty impressive stuff!

WEIRD TIMES! What's Next? And Divorce Planning

 Inflation and Recession

All the news today is about inflation, rising rates, and the prospect of a recession.  What does all this mean for homeownership?  We want to stress that home ownership is historically the best hedge against inflation.  Although interest rates have returned to “normal” territory, reducing affordability for many in comparison to the last two years, there is still a good argument for buying now vs. waiting.

We are NOT going to see a big drop in property values and a wave of foreclosures, recession or no recession. All homeowners since the 2008 meltdown have qualified ON PAPER for their loans, and have also seen dramatic increases in their home value, which means they have plenty of equity.  Plus, there are many many safeguards in place since the meltdown to prevent fraud and guarantee that borrowers are well-qualified for their mortgages.

Although renting today for the next five years may cost a bit less than buying a home, a homeowner will have greater net worth vis-à-vis their equity and principal paydown during that time period.  And, the longer you hold real estate the greater the net worth of the owner.  This is the best way to create wealth.  On average homeowners have 40 times the net worth of renters.  In addition, there are some tax benefits to owning property.  The the interest paid for the loan and the real estate taxes are deductible up to a specific limit.  This deduction saves on income taxes.

In a recession, unemployment usually rises.  However, unemployment is currently so low, even if it increases it is hard to see that it will have much impact.  The technical definition of a recession is when our nation’s Gross Domestic Product (GDP) declines for two consecutive quarters. So far, so good.

There is currently no bubble in real estate values as demand remains strong. The primary driver of an impending recession today is the current rate of inflation. Rising interest rates can cause a decline in economic activity.  We will see how high the Fed will go!  If we enter recession, rates will eventually come down to stimulate the economy.

In the meantime, mortgage rates have fallen in the last two weeks.  This is thought to be a reaction to the fact that the market had already “built in” the expectation of rising rates and inflation, and they are balancing out.

At its worst, a recession typically lasts for 18 months. Not longer. Most pundits are predicting a very mild recession if it does become reality.   Bottom line:  don’t wait on the sidelines!

DIVORCE

We all know someone who is either contemplating a separation or going through divorce.  These individuals require special planning to prepare for a refinance to “cash-out” the departing spouse, or to prepare for the purchase of a new home.  There is a great deal of strategizing involved to achieve a successful result. 

In the instance where a spouse has not been working, and will be relying on spousal support, six months of documented receipt of said support will be required. Start the support payments early! Obtaining new employment to qualify is a possibility, depending on prior education and work experience.

We have quite a bit of experience handling these circumstances both before, during, and after a final judgment is received. These can be tricky situations! 

Reach out to my team for professional guidance.

 

DID YOU KNOW?

We have a CARD TEAM YouTube channel with all kinds of great information on a wide variety of topics including how to prepare for a home purchase;  How to repair credit;  how to plan for a refinance or home purchase during divorce; why Reverse loans are picking up in popularity; how to hold title to real estate, and More!  Here is the link to check out our channel:  The Card Team YouTube Channel

Happy Summer!  Please call us with any questions you may have.

Karen

First COVID, Now A War in Ukraine?

RATES

When clients ask me where rates are heading (nearly every day), I always point out that since we have an international economy today, events around the world can and do affect interest rates here in the US.   Case in point, the markets are currently experiencing dramatic volatility and rates have dropped a bit after a rapid climb in the first Q this year.  How long will it last?  No one can guarantee they will remain on a downward trend, as they have been up and down over the last week.  The bottom line is we can only move forward knowing that eventually rates will continue to rise.  There is nothing like the thrill of receiving three or more reprice notifications during one day!  Up by .25%, down .375%. Yikes!!

The war is having effects in multiple areas including interest rates;  the stock market;  oil prices (as we all can see at the gas pump) and on many other consumer products, as the supply chain is further impacted.   At this juncture no one can predict how long this will last. Only that the poor citizens of Ukraine are feeling much worse pain.

VALUES

Home prices across the country rose last year by an astounding 19%.  In both Los Angeles and Orange Counties, the median home price was $950,000 for the month of January.  Crazy!  Most homeowners have a tremendous amount of equity to play with, whether to pull out cash for upgrades or remodeling, adding a new pool, or to buy another home.  The problem is the short supply of new housing.  I looked at a few Open Houses the past weekend.  It was so nice to actually go to an Open House!   One property was a total teardown with incredible ocean views in the hills of San Clemente, listed at only $1.45 million.  WOW.  We figured it would take at least a $2 million budget to get it to a livable condition.

The lack of inventory is a major contributor to rising home prices.  Our inventory in Southern California is at an all-time low.  That is right, I said an ALL-TIME low.  In some areas condo values rose more quickly than did values of single-family residences, which is an anomaly. This is likely due to higher demand at the lower price levels pushing up those values.

DID YOU KNOW? 

HUD came out with Reverse Loans for purchase with the HECM program in 2009.  I closed a home purchase in March of 2009 with a Reverse loan, for what may have been the first in California.

FUN STUFF

Steve and I began golfing almost every weekend during COVID as one of the few activities we could safely participate in.  While I still don’t have a handicap, I want to report that during our recent golf scramble with 15 couples from our yacht club, we used several of my drives, fairway shots and putts.  YESSSS!

Speaking of the yacht club, things are beginning to return to normalcy with a Mardi Gras bash, weekend brunches and even prime rib night.  Next up:  A weekend cruise to Newport to visit with other yacht clubs.   Steve enjoys crewing on a couple of different boats for the racing events which happen most weekends.  Then we have the Newport to Ensenada race, otherwise known as N2E in April.  I will go down on a tour bus and meet the racers when they get in.  You never know how long the race will take as it all depends on the wind conditions.

Please remember, Life is Good!  And don’t hesitate to call us with any questions you may have.

Rate and Travel Updates

Mortgage rates continue to hover near record lows with the Corona virus taking most of the credit! The market flight to security caused a dip in the stock market which provided a boost to US treasuries.

What does it all mean? Right now is a great time to pull cash out of your home for improvements or remodeling, while rates are low. Home prices have continued to increase, as there isn’t a lot of inventory out there, which means it is a great time to sell if you are so inclined.

If you haven’t refinanced recently you can likely lower your rate and payments, even if you aren’t pulling cash out.

Loan limits have increased again for FNMA, Freddie and FHA/VA loans. The high-cost counties, such as Orange and Los Angeles, are up to $765,500 loan limits… which makes it easier to qualify for mortgage financing.

Reverse loans continue to gain in popularity although I still hear some of the myths repeated, such as “the bank owns your home.” NOT!!!

Please reach out to me or Katie with any questions. We are here to help! Visit our website at www.card-team.com.

FAMILY - TRAVEL

We continue to enjoy spending time with our adult children, grandchildren, and friends. The grandchildren, now numbering five, are ages 7,5,3,2 and 1. We took a camping trip to El Capitan, north of Santa Barbara in September, and most of our crew joined us. The weather cooperated and we had a blast swimming and playing on the beach. I actually tried boogie-boarding for the first time, what a hoot.

November saw us traveling to Maui with friends where we stayed at Ka’anapali. We enjoyed hiking to the blowhole, swimming, snorkeling, and got in a number of scuba dives. We saw more sea turtles than ever before, and had our first sighting of Manta Rays. What a delight! One day we did four dives. Water Warriors!

LITTLE DUME

Steve’s boys played at The Troubador last month and they have released an album. WOW! They are amazing. Just search for Little Dume on Spotify or YouTube to tune in and enjoy! They played earlier in the year at our Yacht Club and were a fabulous success. We hope to host them again there soon.

Here is hoping you all have a wonderful 2020!

5 Tips for your best FICO Score Before You Buy

It is always best to prepare well ahead of time for a home purchase, whether first time or fifth time. We like to begin coaching clients three to six months prior to beginning a home search, to be sure our clients are well-prepared. Your Credit score is extremely important for loan-qualifying purposes, and in order to attain the lowest interest rate.

1. DON'T close any revolving credit accounts; pay them down or off but continue to use them periodically.
2. DON'T pay off any collection accounts; activity in the derogatory section of your credit report can lower your scores. If needed they can be paid through escrow.
3. DO keep all your balances at or below 30% of available credit.
4. DO make all credit card payments on time. A late fee incurred is not reported, unless an account goes 30 days late.
5. DON'T cosign on a loan for someone else. If they miss a payment, your credit will be affected negatively.