As part of the continuing Fact vs. Fiction series, Nicole talks about the facts and fiction of home loans. Listen to this 7-minute episode, play again until it sticks.
A preview:
Fact 1 - call your lender first
Fiction 1 - assume the best loan for them is with 20% down or minimum down.
Fact 2 - you have the power to affect your monthly payment.
Fiction 2 - renting is not more cost-effective unless you are only looking at the immediate short term.
You want to pay your OWN mortgage, not your landlord's.
Fiction 3 - getting a home loan isn't possible unless everything is lined up or perfect.
After hitting low historical interest rates 14 times last year, let's set the record straight. The first piece of fiction is that Rate is King. This is not always exactly as it appears. Oh, and the one using your house as a method to save interest rates on credit cards. Be smart. Then we move into the fiction of long-term real estate investments.
A buy and hold strategy provides OPTIONS. But, just as with rates, options also bring misinformation, many times turning people away from a long-term wealth strategy that could open up possibilities for them and their families. Watch as I bust open some very common concerns that are fiction and go through why, even in today's market, real estate is queen.
Nicole Rueth
The Rueth Team of Fairway Independent Mortgage Corporation
750 W Hampden Avenue, Suite 500 Englewood, CO 80110
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If you have ever been involved in a Real Estate transaction, you've dealt with Title. But what do we need to know about the title process and what should we ask our underwriters? Sima Patel from WFT National Title gives us pointers. Some of what she covers includes advice for those who have gone through bankruptcies or are buying a home from someone who has gone through BK, what you need to know about trusts, LLCs, and quick claim deeds to avoid legal disasters.
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We all know insurance is important, even though we hope to never use it. Because no one wants to pay $5,000 out of pocket when they could have been paying an extra $2 a month. Enter, the creative insurance agent. Unlike 30-40 years ago, insurance brokers can help you find the best value for money when it comes to your homeowner's policy and covering any investments you may have as well.
I had the chance to sit down with Brandon Ridder of Goosehead Insurance to talk more about the importance of having a clear understanding of your coverage and what is crucial to know as a first-time homeowner and investor.
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Let's start with strong demographics. 33% of home buyers today and for the next decade are first time home buyers with nothing to sell, taking from an already stressed market with nothing to give in return. At the other end of the spectrum baby boomers are delaying their downsizing, moving into assisted living nursing homes, or in with family due to their heightened pandemic risk, holding onto those homes younger families need. For new builders NAHB noted lumber continues to spike up with futures up another 35% on top of the already high 170% rise we saw over the last 10 months.
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Nicole's guest, Joey Pizzi of JP Appraisal Services wants consumers to know a few things about the appraisal process to help them before the appraiser arrives, and for buyers to understand the current market filled with over-asking-price offers.
- It's different than a home inspection.
This is what is done during an appraisal: measure, take photos, documentation, assess the condition, look for any needed maintenance
- How hard is it to appraise a home?
Need to really be familiar with the market. This includes all of these offers coming up to $100,000 over asking prices. Your appraisers need to know how to read the market and look out for anomalies.
- Things a seller can do before the appraiser arrives.
PAINT: railings, cabinets, holes in the walls.
Cleanliness shouldn't affect the appraisal, but it can be distracting. Declutter, clean up - show that the house is cared for.
There are a lot of things that go into qualifying for a loan. One that remains the same no matter the product, you need to have a good credit score. If you're looking to purchase a home you need to make sure you're set up to get the best financing you can by having the best credit you can. This week I am beyond excited to share one of my hidden secrets, David Emge of Credit Advisor. He's our go-to at The Rueth Team to help our buyers get their credit score where it needs to be to qualify for the home they want. Not only that but David makes sure his clients know how to continue to keep their score up to help them build long-term wealth. And who doesn't want that?
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Nicole's guest is Jenny Usaj of Usaj Realty. She explores several zip codes in neighbhoods that have seen a wonderful uptick in prices, as well as ongoing opportunity for investment. Jenny also gives agents advice about how to help their clients drill their buyers down to real needs, rather than distractions when they research online. She wraps up with talking about condos, and future income property and her favorite neighborhoods.
Listen to this 15-minute recap from January's tips: Why an inspector is a must, Top 4 Things to Know Before an Inspection, and Exiting Forbearance.
We've been talking a lot lately about buying your first investment. But what if you're a first-time homebuyer? One of the things that you're going to do right out of the gate when you get under contract is called a home inspector. And if you don't know one, you're probably going to get one from your real estate agent. But what does a home inspector do and why do you need one and why it might be different for inspecting a primary home versus an investment property with a different intention? I brought along Andrew Sams, who I absolutely adore, very well-respected, well-known here in the Denver Metro and up in Evergreen. And he wanted to talk a little bit about what you as a buyer could expect or should expect when you meet with an inspector. He does own Alpine Building Performance, in case you want to look him up. Andrew, what should a buyer be asking you, or what can they expect?
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There are things I know, things I wonder about, and things that boggle my mind. Here are a few… I knew demand was about to explode before 2020 began. Demographics told us that. 8.8 to 9.2 million first-time home buyers were coming and they wanted a piece of the American Dream. With the largest age cohort numbering over 23 million, Americans aged 25 to 29 are looking to start families and buy homes. And once someone has a child they are twice as likely to purchase a home.
I knew that a recession was coming, or at least I was pretty certain. America was on a Recession Watch at the end of 2019 and beginning of 2020 tracking slowing manufacturing, shipping, business spending, and job creation as well as declining consumer confidence, talks of trade wars, and political unrest. The two and ten-year yields had also inverted pointing to a longer-term financial instability.
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