Welcome back.
We gave you a couple weeks off of take 10 mainly because it was fall break and there
was plenty to talk about but there's also plenty of time to catch up.
So let's start with our resident market reader, Corey Freel.
Let's do it.
Fortune telling business is not good right now.
It's not good for the fortune tellers.
So interest rates bottomed out right before the Federal Reserve dropped rates and then
they moved higher.
That was September 18th.
That was the 18th of September.
And so now here we are a month later and people are kind of like, hey, where those
low rates are at about since the Fed dropped like they're lower, right?
And we're like, no, they're not.
So just like the Cinderella one hit wonder in the late 80s, you don't know what you
got till it's gone.
We had so many conversations with people, both buyers and people looking to refinance.
They were like, you need to do this.
We got a window and they're like, no, no, no, no, we'll wait because things are going
to get better.
Are they?
And hope is not a strategy.
So so yeah, I mean, interest rates are probably half a point worse now at least.
Also though, let me just go ahead and say it still could make sense to refinance.
You just need to look at the cost of waiting calculator.
That's right.
So we have a calculator that doesn't an analysis of where your rate is now.
So let's say you've got a rate in the mid sevens and you could get to the mid sixes,
but in your mind, you want something that starts with a five.
We can do an analysis on that and say, okay, what would happen if you waited until they
hit the fives to refinance?
And then how much of that cost you?
Because every month you keep paying your payment at that higher rate.
It costs you money.
That's money going out the door that doesn't have to because the market's better now.
So I think the lesson that we can all take from this is and this has been true for two
years now.
Yeah.
When you get a good interest rate day and literally sometimes it's a day, you take it.
You grab it.
What is it?
What is it you say pigs get fat?
Hogs get slaughtered.
Right.
Yeah.
Don't be slaughtered.
That's right.
Don't be a hog.
My version of that is bulls eat bears eat pigs get slaughtered.
That's a lot of animals.
It is.
That's a Wall Street thing.
That is the truth.
So if it makes sense for you to buy, if it makes sense for you to refinance, if it makes
sense for your customers to move, they need to move now because all you have is today
and you don't know what tomorrow is going to bring.
Truth.
And can you give a quick down and dirty as to why this movement up and what reports happened
that caused the...
Yeah.
Absolutely.
So what made markets move lower in the beginning was from the highs of April until September
18th, markets were already moving lower, interest rates were already moving lower in anticipation
of the Fed making this cut.
And so when the Fed releases their statement, they not only say, hey, we're cutting rates
today, they also give you a forecast of what they think they're going to do for the next
couple of years.
And so we got that forecast and it met with the market's thought, hey, we're going to
drop another 50 for the end of the year and then another 100 next year.
And so markets were like, check, all right, we know that now they move their focus to
the employment picture.
So two things that the Fed looks at, inflation is one, we got that one whooped, we think.
The other now is employment.
So how do we keep Americans employed?
So now everybody's looking at every employment report really closely and we saw employment
go down where we thought it would stay stable or go up and that is not good for interest
rates.
So it doesn't signal that we're in any economic slowdown.
It's not great for inflation.
And so markets are trading now off stronger than...
And it continues to be, every where we get is stronger than expected, stronger than expected
for employment, but it just keeps pushing rates higher and higher every time.
So with all that said, something that I've noticed as a trend is as the rates start going
higher and higher, the deals get harder and harder.
But you know what?
We're also more and more willing to make those hard deals happen.
So I want to talk a little bit today about the problems solved, a couple of strategies.
We've got 99 problems.
That's another song, reference from the 90s, I think, maybe early thousands.
We've got 99 problems.
But these are ones that we...
These strategies and things that we did made a deal happen that otherwise would not have
happened and successfully got people into homes and streamlined that process.
So I was just going to go through a couple of those.
This year.
One that we just...
A crowning moment.
On Monday, we closed a person with a 431 credit score.
That's so solid.
How?
We have a program that...
That's a record.
I mean, how do you close one lower than that?
How do you get that low?
Yes, sometimes you do.
Sometimes you get that low and you never have a closed one ever with a credit score in the
force.
But we did and we did that on Monday and we did that using a blended score.
And so...
What's a blended score?
It is when you have a co-borrower with a higher score and you can take the two scores and
blend them into whatever that average score is and utilize that for qualification.
Specific program to use for that, but it worked also on a manufactured home, which was hard.
But...
Also in a flood disaster area.
And we wish the best for all the people there, but it was fine.
And we were able to do a Zoom call...
To verify that it was still there.
To verify it was still there.
So we were able to get that done same day, which was nice.
Because that's also been a little hitch in the giddy up since we are so close to the
affected areas.
Rescores on credit.
That's one of our oldest tricks, but it's more relevant now than ever.
The credit reports, we have a program that will allow us to give specific instructions
to the client on what they need to do, what steps they need to take to get that credit
score up to a certain space that would make them approvable.
And when you say specific, you mean specific.
I mean, if they say pay this card down to $221.72, it needs to be exactly that.
Exactly.
Or you're not getting your score back.
And it takes about five business days.
But that's been a game changer across the board.
Also to get better rates, right?
Because your rates are also sometimes sensitive to credit.
So we just closed one two weeks ago.
It was a 10-day turn upfront underwrite.
She only got that contract because she could close in 10 days and we could wait for the
finance contingency.
I know you guys have already heard about that trick.
Just wanted to bring that back to the forefront.
Any file that's suspect on will they qualify, we're doing that for you guys anyway.
That upfront underwrite, just to make sure we have a sure thing because we don't want
you driving around if it's not.
But also if they want to get really aggressive, your client does.
It takes five business days from the time that we received their documentation to get
them fully through underwriting and approved.
And that will make your offers way stronger and give you something to negotiate.
Something else that's been great.
What if you, there's been a lot of people who need to buy without selling.
So we, and if they can qualify for both of the payments, but all this cash is going to
come as a large lump sum cash infusion afterwards.
And they don't want to pay that higher mortgage payment forever because they had to only put
5% down on what they were buying because all their cash is over here on the house they're
selling.
We use a recast.
Do that all the time.
I mean, probably three or four months.
We don't do them on government loans.
That's correct.
Only conventional loans.
I mean, let's say you, you're going to sell your house, but you have to make your offer
non-contingent and the house is 600,000.
I can put 5% down conventional on the $600,000 house.
So my house, say I clear 200 on my house.
Now I'll put the 200 down on the big house and I can drop mortgage insurance and make
that payment resemble what it would have been with a 400,000 or a loan, whatever, 350 loan.
More or less on one fell swoop.
In one fell swoop.
Now one fell swoop doesn't mean it's like a K-grott.
Like they don't want to do it.
Take 45 days.
Service just don't want to do it.
We make them do it.
And it's the deal that they made.
So anyway, do that all the time.
This is an interesting one that just got one approved, which I love this, is that on VA
loans, you can actually pay off the veterans revolving or installment debts to help them
qualify with seller pay closing costs.
So little known hack.
We're doing two like that this month.
That is awesome.
Like what a cool little nugget, you know.
And what a better, let's just think about the feeling around it.
This veteran is feeling like they have all these payments pushing down on them.
They have this new house payment.
They feel stressed.
We're taking a ton of those little tiny payments off of them or that one big installment off
of them.
And so they really just have that house payment left.
And they can manage it a lot easier and they're going in more or less debt free.
Right.
So it, it betters their position.
It's a wonderful little trick that we've been using and it's awesome.
So this one has been happening more often than not post closing repair escrows.
Yep.
So we don't have to hold up a closing for repair items unless it's health and safety
health and safety structural.
Yeah, so like, yeah, like a, even though like a fence, like a railing around the porch,
got to get that done first.
But if it's something minor,
It's over 36 inches.
Didn't you get, as long as it's, as long as it meets code, you don't have to do it
at all.
But repair escrows, things we can do, we can go ahead and close alone, get something fixed
after to make it sellable.
So yeah.
So that's been really nice just to allow everybody to close, move on and do the repairs
as they see fit.
Yeah.
And sometimes a seller doesn't have the money to fix it.
That's true.
Right.
Or you don't want them to fix it.
Or you don't want the seller.
You want your own contractor to fix it.
So the seller may not have the funds.
You certainly don't want your buyer spending their money on the seller's house before
they own it.
Yeah.
And so this is a way to protect everybody.
So just a quick reminder, because I know you guys know that probably as well, but it's
very relevant right now because a lot of the housing stock has repairs needed right now.
You guys are seeing these houses.
A lot of them come with repairs.
So I want to add one thing to that.
If you don't do a lot of these and I hope you don't as an agent, which we did less,
there is a contingency there.
So if like say the repair costs $2,000, we're going to need a contingency.
What is it 25%?
Yeah, something like that.
So you're going to need between, you know, probably 500 bucks in contingency to hold
on top of the money that you need to make sure that those repairs get done.
So in that instance, if the repair is $2,000, we're going to hold 2,500 when the work is
done.
We're going to hold 2,500 from the seller when the work is done.
We're going to reimburse the seller as soon as we get the invoice from the contractor.
And if the bill is two grand, then we give the seller back 500 bucks and pay the contractor.
Whatever the difference is.
This has been very helpful.
Our E-Close, our branch is doing 90 to 100% E-Close.
And what is so amazing about that is that the clients are getting 90% of their documents
at home that morning to click through.
And by the time they get to the title company, it takes 20 minutes to close.
So even on, you know, just trying to slide things in at the end of the day, move things
up, do any of that moving and shaking, that E-Close is huge in fitting multiple closings
in in a day and last minute type things.
So it's helped us be very flexible working with that department.
Just a lot more pleasant to when you're buying and moving in on the same day, you know, any,
if you get 30 minutes back from the title company, that's a huge win.
Yeah, nobody wants to spend all day there.
Also I keep missing my closings.
That is the only problem.
I get there and they're done.
Yes, you don't mean the loan closes.
You just can't get there.
I can't get there in time.
They each sign go in 10 minutes later.
We don't miss closing dates.
Oh yeah, sorry.
Was that a misfit?
That was a just just clarified just in case I like I like the clarification.
And then now that the rates are higher as a nice little bow around this whole thing,
that temp buy down you guys, the temp buy down is the play.
The temporary buy down can take that interest rate.
You know, we have a three to one, a two one and a one oh and what those numbers signify
are the percentage amounts below the locked in rate.
So if you have a one oh buy down and let's say the rate six and a quarter, then the first
year it will be the customer will pay 12 payments at five and a quarter as we sit and wait this
market out if and when it changes, right?
I think economists are still saying it's going to change.
I do.
I think rates are going to move down eventually, but the question is when and then how long
do your buyers have to wait?
How long do your people have to wait?
Right.
So if they don't, if they want that lower payment and that lower rate now, temp buy down,
right?
And then whatever money that let's say that the rates do drop in six months, whatever
money is sitting in that escrow account with the temporary buy down funds in there because
the money that's collected in that is the interest differential between the two interest
rates, whatever money is left over, they get it back.
It's not a fee.
Awesome product.
So the client will get that money back.
So building that in is not a bad thing because what they are doing is utilizing the equity
to help them make a lower payment and feel comfortable and pull the trigger now.
That's all we're trying to do is give you guys ideas around products and programs and
strategies to pull the trigger now and do it in a way that is responsible that helps
your client feel comfortable in this uncomfortable market.
Sure.
Absolutely.
Yeah.
Because when it gets comfortable, your inventory is going to dry up.
Yeah.
You got your inventory, right?
Now you got choices, but when it gets comfortable, not going to have inventory.
Then it will be comfortable in a different way.
Yeah.
Or you're bidding on like six houses.
So we're always uncomfortable.
Yep.
Which is comfortable.
That's great.
So as a wrap up, we have somebody on our team nights and weekends.
That's right.
Always after hours at theeltwgroup.com.
That's how you get it.
After hours at theeltwgroup.com.
All right.
We'll take care of you.
Peace.
Be safe, and our next Évidios will be around Wednesday.
Okay.
Sorry.
Bye.
Okay.
Yeah.
Bye!