Hey, hello everybody and welcome to Spotlight Vancouver, Washington.
I'm your host Doug Varenas, licensed real estate agent in Washington and Oregon.
Happy New Year to everybody and thanks for all the subscribes and likes and support
of the show.
If you have any requests, any suggestions, I always appreciate them and I appreciate
you for listening.
Today, we have the money magician I call him from Guild Morgans, Trevor Bonnet, a loan
officer and I'm wondering if they're coming up with a better term than loan officer.
It sounds a little, it kind of reminds me of law enforcement in a way.
I don't know if they're working on that.
You know, I don't know if anybody's actively brainstorming other names and loan officers
but I hear them all the time, mortgage professional loan officer.
I prefer loan guru but then I have people tell me that, you know, that's a little culty
as well.
So, I want to go with money magician.
Yeah, I'm going to go with money magician because I love it.
Okay, that's what I usually say and as a money magician, you really provide a lot of services
that I think people don't know about and I'm always counseling buyers about consulting
before sooner rather than later.
Can you speak to how and when someone who's interested in buying a home should get in
touch with you?
Yeah, I mean day one, you know, is kind of the short answer unfortunately to be vague
but oftentimes I have conversations with people every day, multiple times a day and
they have a whole list of reasons on why they're waiting and those reasons aren't we can't
afford a house, we don't know what we're doing, it's well, I need to work on my credit
or I need to, I have to pay off my debt and unfortunately with lending and with credit
scores which pay a strict not a licensed credit professional, have to maybe put that down
there.
And I think one of the goals that I have in place that I can help you get to where you
want to be faster and oftentimes less cost effective route than you were originally
going to go, there's nothing common sense about updating your credit scores or knowing
what type of loan programs there are.
And I've had people that wait and wait and wait and they pay off all their debt and
they close off all their accounts and they see a massive credit drop because now they
have no active trade lines.
They paid off everything as agreed but at the end of the day the credit bureaus don't
look at it that way.
So oftentimes when I have people tell me, hey, I'm three months out, start today, hey,
I'm six months out, let's have a conversation, let's develop a plan, let's figure out where
you're at.
Everybody's a little bit different on a tailor made search, it's kind of a pick your own
adventure but that being said, get me in the conversation day one so that we can make sure
you're on the right path.
Yeah, sooner rather than later, I mean even a year or two I would recommend reaching out
because you're the one with the key to the finances so you know what you're looking for
and the value that you provide is that you're able to tell them exactly what they need to
do to get where they need to be to get that financing.
So I feel like a lot of times this is like somebody feels like you guys are like a teacher
or a gatekeeper, like they have to turn in their homework and they have to have it all
perfect before they turn it in but really it's the opposite.
You want to bring your homework if you will, your application or your potential to purchase
a home and you want to present the information earlier so you can get that feedback like
you said.
What are some of those mistakes that you see potential borrowers making?
You mentioned like paying off the wrong debt.
What are some other mistakes that you're seeing out there for people looking for a loan?
So it's just based on a couple of them kind of freely trying to improve your credit scores
but not everybody's got a friend at their local tavern or their mother-in-law or somebody
has advice and sometimes that advice is great and sometimes that advice is not good at all.
And so getting me started in the process earlier will give you kind of the blueprint of what
a lender is going to look at in regards to your credit score.
A big one.
I have $50,000 in student debt, I need to pay that off before I start.
Okay, well how much is your monthly liability on those student loans?
Because that's really what a lender is going to look at.
What's your payment history on those and what is your monthly liability?
Because I'm going to look at a couple things.
There's DTI which is debt to income ratio.
I want to make sure that you can afford this new home you're purchasing along with your
current debt load that you have and maybe there's some room there where I can tell you
hey debt to income ratio is too high.
Let's focus on these debts for this reason.
Another one changing professions.
You know, hey I just went from a W-2 nurse where I was working 36 hours a week every
week shift differential and all that.
Well now I'm a car salesman and I'm making way more money but it's all commission based.
Well, I can't use that for the foreseeable future.
So having me in the process earlier can help you kind of forgo some of that heartache or
that help you to not make such big life decisions that might hinder you from buying an house.
So again, it's really getting in early because from my understanding it's the amount of monthly
debt that you have versus the amount of total debt.
So like you mentioned in the student debt example, you may have quite a bit of debt
but you may be on an income based repay or something where you're only paying $300 a
month.
So it's not based on the total debt and you really need to reach out sooner like you said
to just kind of get a bird's eye view of where you're at and where you need to go.
Yeah, 100%.
And another common one is like not having a down payment.
Right?
Oh, I'm saving for a down payment.
And you know, most people don't know that there are down payment assistance programs
for people and there's such a wide variety of programs out there for people that not
just I offer but just lenders in the community that you can get into a home with little or
no money down and still have your payment be relatively affordable.
That being said, the less you put down, the higher your loan amount, the higher your monthly
payment will be.
So there's a caveat there but it does open the doors.
And what we're finding is in the last few years with inflation and with, you know, upkeep
and jobs and how expensive everything is, people are not out saving the market.
People are not putting away enough money in their saving account to make a dent in a down
payment on a home.
The real people that are finding success are the people that are purchasing a home and
letting that equity naturally build, you know, not like what we saw on COVID but, you know,
maybe one to 3% year after year while they continue to pay their mortgage payment down.
And then when those people are ready to buy their next home, now they have this down payment
from the sale of their home or they have an equity position that they can utilize to greater
benefit themselves and their families.
Right.
It's always time in the market versus trying to time the market.
And I just did a New Year's show where predictions and one of them was like, we're not leaving
the 6% to 7% range anytime soon.
So, you know, people that are waiting for this, you know, the 3% rates again, like it's
just, it's not going to happen in the foreseeable future.
And so I don't think that's a reliable strategy because, again, you're missing out on some
equity opportunities, you know, with time in the market versus trying to time the rates
and try to time when there's going to be the housing crash, you know, that we've been talking
about for, you know, five years or longer.
That just hasn't quite happened.
You know, what would you say you mentioned kind of people that have, you know, there's
a lot of people that have the lower interest rates, but they are having additions to their
family or their living situations change or their job situations changed, you know, but
they're hesitant to give up their, you know, 3% loan, understandably, to buy, to upsize
to another home.
What do you say to those potential buyers about where they're at?
You know, there's kind of a cliche in my industry, which is date the rate, marry the house.
And I think people really forgot this during COVID because people were writing offers on
homes where we're seeing during COVID time, where we're seeing like, oh, I'm just going
to offer above asking and wave all of these, you know, inspection contingencies and all
of these things that protect home buyer, because I'm going to get a 2.5% interest rate, you
know, and then they sign the dotted line and a year later, their three bedroom, two bath
house or three bedroom, one bath house for some people, all of a sudden they're realizing,
oh my gosh, we just had our third child.
And we don't fit this home anymore.
And so although I do think it's kind of a cliche, dating the rate and marrying the house,
you have to have a home that fits your needs.
And people can get creative and they can help their home to fit their needs and then kind
of come up with some creative ways around that.
But at a certain point, you know, a 1200 square foot home or smaller, there's only so much
stuff you can do with your stuff.
And when you have other human beings living there, like your small children, you have
to figure out what you're going to do to make sure that you have the space that you can
actually enjoy your home you're living in.
Kind of a similar situation.
Call your lender.
Call me day one.
Hey, I'm just curious, what does it look like?
And your lender should be able to do, you know, a 15 to 20 minute application.
Go, hey, we're just going to update this from the last file.
Any changes in income, any changes in assets, what do we do if we sell that home?
What do we do if we maybe rent out your current home?
And then just go over grass tax.
This is the numbers.
This is what it looks like.
At least you're not guessing or you're not operating out of a place of fear where you're
saying, I don't want to give up my 3% interest rate or my 2% interest rate.
You're saying, I actually can't afford the payment on a 6% interest rate.
And that's something that I would much rather have.
Right.
And I think people forget the equity piece too.
Like most of the people that have a 3% interest rate or they have a lot of equity that they
could potentially put towards a home that's going to fit their needs a little better.
And they tend to forget that part of the equation and they're focusing on the higher rate environment.
And there is only so much renovation you can do.
I live this personally.
And I think renovation is a great way to kind of circumnavigate some of those uncomfortable
parts of getting a little bit crowded in a home.
But yeah, ultimately, if it's not working for you, you need to take some action.
And I think, like you said, focusing on your equity position, how that's going to work
in your favor, even given a 6%, 6.5% rate is just going to give you a picture on what
that monthly payment is going to be.
And it might be different than you think.
It might be in a better position than you think.
Information is power in this circumstance.
So the more information you have that you can make an educated decision for you and your
family, the better.
That's just plain and simple.
So if you're just guessing, right, if you're just saying, I don't want to pay double an
interest, OK, but you're going to stay there because the rate climate is not as of current
predictions were expected to see 6 and 7s for the next year, maybe more.
Now predictions are dangerous because they change all the time.
And I think that the overall theme here is sooner, better than later.
Where can people find you if they want to reach out to get that consultation and find
out where they are?
Yeah.
So I mean, I give out my cell phone to everybody.
So that's probably the best one to reach me at, which is 9210650.
You can also find me at GuildMortgage-TrevorBonnett.
And that's B-O-N-N-E-T-T for the last name.
Maybe you'll put some fancy banner down here.
I will put everything.
I'll put all your contact information in the show notes.
Perfect.
Trevor, I want to thank you for all the service you provide to the people of Clark County and
beyond, and we're going to have to have you back to talk about some other things at some
point, but I appreciate you.
And I want to wish you and your family a happy new year.
I appreciate it.
Happy new year, happy 2025, and I would love to be back.
All right.
Thanks, Trevor.
Appreciate it.
Sergey talked about the Jahrhwald