The Double Comma Club

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Agents, are you taking this time to binge or build?


Let's kick off this episode's theme with a quote from Andy Andrews, author of, Bottom of the Pool.  "You have the power to choose every moment of every day, what YOU do with your time is entirely up to you.  You can invest it wisely or waste it foolishly. 

By choosing how to invest your time, it follows that you are also choosing what you learn, how much you learn, how deeply you understand what you’ve learned, what your imagination makes of it——and in what fashion you act upon whatever that might be."

Somewhere along the line, the decisions that were made by the government in their haste to solve the consumer need, we got broken along the way. When they solved one problem, what happened is we had three to four new problems that surfaced. The very first problem was all the money that the federal reserve was pushing out in the market buying mortgage-backed securities. They were creating inequality of supply and demand and they were flooding the market with money. Now that money was creating instability and now we have ups and downs, this 2.5% coupon is just the 30-year coupon that we watched similarly to the 10-year treasury. So forget about the specific bond that I'm tracking, but this is the one that we track when we associate what is our 30 year fixed loans doing, our mortgage loans. So you'd have ups and downs, but within each day, you had very little volatility. Then the fed started pushing out all this money and every single day was a massive swing.

Think of a property manager. Property managers don't own assets and they don't have savings accounts specific to that property. They're managing your property. So that rent check comes in every month from that, they take their cut, their 10%, they pay all the bills for any maintenance that needed to happen that week or that month. They might take care of any other expenses and then they cut you a net check. So they don't have a massive piggy bank to take care of what happens if the rents don't still come in, but I'm still required to pay my owners. It doesn't work that way.

FHA said, "You know what? We're just going to wait and see." Meanwhile, Treasury Secretary Mnuchin is saying, "No, we need the stability of the mortgage market to create stability in the real estate market. It was stable coming in. We needed to be stable going out and this is how we do it."

He's leaning in on FHA to make that happen and he's reassuring that it will happen. Now the treasury doesn't have the ability to do it on their own, but he's certainly behind it. So is Federal Chair Powell. Powell Absolutely gets it, he sees it. And interestingly enough, Mnuchin and Powell have become allies in all of this and they're going against the FHA director, Mark Calabria.

Housing is going to get worse before it gets better, but it is going to get better. And it's a timing thing. Remember we didn't start this until mid-March. We're only now in mid-April. It feels like forever. It feels like forever because we're trapped in our homes. But when it comes to financial positioning, we don't quite know where it is yet. Because remember all of the statistics for March were only half right. And now April is not over yet. So what does April's number's going to look like? But it is going to get worse before it gets better. But it will be much better when we come out of this.

One of the things that I know is true is because the housing market was so strong coming into it right up until March, the pending home sales were still strong. They still had people that we're buying. I mean, we had a phenomenal January, February, and March. Even April is off the charts and it's because everybody that we had in the pipeline, what's May to look like? But we came into this very strong. Inventory was our problem. Any of the numbers that were weak, sales numbers that were weaker than they should have been was because of inventory. But January and February were phenomenal. We had a 6.25% growth in median sales price just in January and February alone. Again, because of the lack of supply, but the demand was off the charts.

Remember that yes, manufacturing was down, but consumer spending was like phenomenal and consumer spending is 70% of the GDP. People's wages were up, spending was up, savings were up, they were feeling good. Colorado was the number two wage growth. We had consistent job growth week over week, and we had a really strong mortgage and financial environment as well. So if there was a time, and that's the silver lining I'm hanging on to, it's the time that we came into this being strong, we're going to come out of it strong.

In this episode of the DoubleCommaClub, Nicole asks you, "Are you binging, or are you building?" She covers the DMAR market for the month with a detailed dive into the status of lenders, including nonbanks, unemployment immediate and longer-term effect on demand, and whether you should be guiding your borrowers to take action now. 

Listen to this full episode to get all of Nicole's insights and results from her research for the week.

Nicole Rueth
The Rueth Team of Fairway Independent Mortgage Corporation
750 W Hampden Avenue, Suite 500
Englewood, CO 80110

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Landlord Issues with Forbearance and Where Did All the Jumbos Go?


Obviously, as people go through the pipeline and their closings happening, we're not getting as many new people in the pipeline, so that will wane, but closings are still happening. Business, with respect to what you can and can't do, is still happening. Then, I want to kind of wrap this up, and then we'll open up for Q&A is, "What can you keep doing? How do you continue to stay engaged?" Keep learning new technologies, whether that's joining the class on Tuesday or doing a different technology, whatever suits you. This is the second half of the Coffee Talk session from April 1 - 

Preparing Agents to be Able to Respond to the Rebound

In this episode, the questions included:

Clients looking to buy - should they sell their home or rent - what are the risks?

Landlords are dealing with renters having the same options that homeowners have with forbearance. What does that mean for them?

How can you be in compliance with state laws and policies, but still serve those who HAVE to sell, who HAVE to buy?

Will there be incentives for first time home buyers as there were in 2008 and 2010?

Any ideas or thoughts of rates and what they will do over the next month or two?

Why jumbos are going away and why are they harder to find?

With people looking for new loans, what are credit minimums and BPI maximums for FHA and conventional?

If you have a 3.875% interest rate - where is the threshold to see a profit with a refinance?

Listen to this full episode to get all of Nicole's insights and results from her research for the week.

Nicole Rueth
The Rueth Team of Fairway Independent Mortgage Corporation
750 W Hampden Avenue, Suite 500
Englewood, CO 80110

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Preparing Agents to be Able to Respond to the Rebound


Jobless claims came out yesterday, and they were actually down just a tick, which really doesn't help at all because we're sitting now after three weeks, we have 3.3 million three weeks ago, 6.6 million the week after that, and then just right at 6.6 million, so we had a little bit over that two weeks ago, and then this week, we just came in at 6.6 million. Those are some staggering numbers. Having said that, I am going to continue to go back to the fact that this is not a housing bubble. This is not an economic recession.

MBA puts together this measure on a monthly basis, and they've been watching the credit availability and it fell off, and it fell off specifically because of those non-government backed loans. I want to talk about this for a second. This is the lowest level of mortgage credit availability since 2015, and a lot of this loss is in the non-government. If I look at conventional, which is non-government backed, which is an interesting term because you actually think of conventional kind of being all-encompassing, the conventional measure, in this case, is the non-government backed, so you're talking about the small banks, the portfolio loans, and the instances where they're not Fannie Mae and Freddie Mac. Those went down 24% already, and they'll probably go down even further the next month when these are measured.

Conforming, which is backed by Fannie Mae and Freddie Mac, was down 2.7%, the number of people that could be eligible versus were eligible last month. This is the measure of eligibility. Jumbo was down 37%. Jumbo has almost become non-existent. Only certain banks are having it, and they're requiring lower loan-to-values, lower debt-to-income ratios, and higher credit scores.

Then, Ginnie Mae, which covers FHA, VA, and USDA was down almost 7%, and that's because of those credit score restrictions that we all saw, where we were coming up off of the 600. Some banks were going to 640, 660, 680, and then many of them were restricting the debt-to-income ratio to 45%. We also saw many lenders saw the loss of the down payment assistance programs. All of that goes into that. We're going to see that number go lower still in April.

Now, interestingly enough, there's a lot of conversations going on today with Chase, who holds one of the largest warehouse lines. Chase CEO and Mark Calabria are, I don't want to say they're buddies, they know each other, and the question is, is, "Is this some sort of a play for market share?" I don't know. I'm just, I'm being human and I'm guessing. There are some conversations going on as far as, "Where is this going? What are the actual goals set behind the scenes that are creating this inability for FHFA to stand up where we need them most?", because that kind of stability is what gives me, the lender, you, the realtor and our consumers that we serve the knowledge and the comfort, knowing that this is all going to be okay, and the housing market, which was so strong before we got here will be that strong, if not, stronger when we get out.

In fact, it's my belief that the housing market could be the very thing that continues to grow our economic strength and pull us out of this recession quickly. Those are conversations that have yet to have been concluded. They're conversations that are still going on. Who is going to be affected most? It's the first-time homebuyer.

Listen to this full episode to get all of Nicole's insights and results from her research for the week.

Nicole Rueth
The Rueth Team of Fairway Independent Mortgage Corporation
750 W Hampden Avenue, Suite 500
Englewood, CO 80110

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What new home buyers need to do now so they can buy, rather than rent, plus Freddie & Fannie updates


This episode is the Q&A portion from the 4/3 Agent Ignite Coffee Talk: How the Stimulus Package Affects Real Estate, and Equity Rich Zip-codes.

Questions included wondering about how new home buyers are affected, more on forbearance rules and recommendations, Fannie & Freddie, and how lenders are putting a PAUSE on new transactions. Listen to this episode. RSVP to join the next coffee talk and reach out to Nicole Rueth directly if you have more questions.


Coffee Talk:

Agent Ignite:

The Rueth Team of Fairway Independent Mortgage Corporation
750 W Hampden Avenue, Suite 500
Englewood, CO 80110

Connect on social media:

Follow me on FB: 
YouTube Channel:

How the Stimulus Package Affects Real Estate, and Equity Rich Zip-codes


In this episode of The Double Comma Club, this discussion took place during the new Friday morning series, Agent Ignite Coffee Talk. Some of the topics and points covered included:

Phase 3 Stimulus Package Highlights and how it affects Real Estate:

  1. Foreclosure moratorium for 60 days beginning March 18, 2020.
  2. Moratorium on eviction filings for tenants for nonpayment of rent for 120 days
  3. 3. Borrowers of government-backed mortgages can request up to 360-day payment forbearance. Proof of hardship isn’t necessary. No fees, interest, or penalties can be assessed for the forbearance.
  4. Independent contractors may be eligible for SBA 7(a) loans in response to COVID-19 covering expenses for the period of Feb. 15, 2020 through June 30, 2020.
  5. Federal student loans are suspended for 6 months.
  6. Cash payments based upon certain thresholds.
  7. Early withdrawals from their retirement account and IRA without penalty.
  8. Tax credits have been provided for gifts
  9. Pandemic Unemployment Assistance (Section 2102) is available for independent contractors
  10. Pandemic Emergency Unemployment Compensation (Section 2107) provides additional relieve after state unemployment is no longer available (addl $600/wk)

Equity Rich Zip Codes


3 Things YOU Can Do Now to Move Your Business Forward

Create a rigid routine.  And stick to it!

Setting a routine is one of the most important steps you can take to ensure you remain focused and successful.  Just because our “normal” day is no longer normal, it’s no excuse.  When you routinize, disturbances give you less trouble. They’re boxed out—by the order and clarity you built.  We need routine now more than ever. Make the necessary adjustments. Then stick to your routine!

Add some letters to your name.

Learn what it takes to get your SRES, SRS, ABR or a host of designations.    A great place to start is this NAR Website.  Explore all the various accreditations and the requirements.  With some free time on your hands, time is well spent learning.


Set up 3 meetings next week with prospective clients using Zoom.  Share what the market is doing right now and what it’s going to do when this is over.  Let them know this is NOT the same as 2008. Trouble figuring out the whole Zoom thing…I got you!  I will be hosting a Zoom for Dummies class on Tuesday morning at 10:30. 


Coffee Talk:

Agent Ignite:

The Rueth Team of Fairway Independent Mortgage Corporation
750 W Hampden Avenue, Suite 500
Englewood, CO 80110

Connect on social media:

Follow me on FB: 
YouTube Channel:

Coffee Talk - Recapping the Week in Real Estate 03212020



Welcome to our first Agent Ignite Coffee Talk. I've got my water. As I was telling Jeremy Keen earlier, he's like, "Where's your coffee?" I'm two coffees in already, so I'm already a little shaky and I talk fast anyway, so I'm not sure you guys could keep up if I had a third. That's the New Yorker coming out in me. Our first weekly Agent Ignite Coffee Talk, we're going to do this until we don't. We're going to do this until things settle down again.

Right now, things are happening at light speed. It is just changing daily, and so the moment we don't need this anymore, we'll pull back to our monthly, but for right now, we do. The only Fridays that it won't happen on is the Friday that we have the third Thursday monthly agent night. We're going to hold true to that format. I've got Bruce Gardner coming in April. Hopefully, we'll all be back together again in May, but we've got an incredible speaker lineup for our monthly events.

We're going to keep doing those, so let's jump in. I want to share what happened this week, but I want to put it in the perspective of where we came from. 

Listen to the Q&S Session from this week's coffee talk here >


Coffee Talk:

Agent Ignite:

How fast can you listen or read? Nicole had a bunch of coffee for this so we know she's speaking fast, but if you missed something, you can replay or read through the transcript here:

We're going to keep doing those, so let's jump in. I want to share what happened this week, but I want to put it in the perspective of where we came from. Everybody's trying to liken this recession to 2008, or even to 9/11, and I get it. We want to compare it to something, because with that comparison comes a sense of familiarity, something that I can wrap my head around, but it's not necessarily comparable.

For that, I want to be very specific that this is different. This, as you guys probably already know, is a pandemic. It is all centered around the Coronavirus. The faster we move towards a treatment plan, the faster we pull out of this. The housing market was the strongest it had ever been. In fact, home sales were at a 13-year high, housing starts were at a 13-year high, we had tight inventory, which we'd love to see more supply.

That tight inventory was giving us appreciation. We had strong demand and we're going to continue to have strong demand. You guys saw, if you were last week's Agent Ignite, where I showed you the average age of a home buyer is 33, and for the next five years we have this massive population gain, so thankful for those babies being born 33 years ago, we have this continued demand and life will go on.

Kids will graduate, people will have to move, people will have babies, and that's just going to happen and it's going to continue to happen. We have this continued demand and we also have low-interest rates, and we're going to talk about interest rates a little bit, but they have been extremely volatile, but they're still low. On any given day, I'm walking anything between three and a quarter and four and a quarter, and I know that sounds high, today's market, four and a quarter.

That swing historically is still at amazingly low-interest rates, and we all know that once we get into a recession, that those rates are going to continue to stay low. We've got a while of low-interest rates on our side, which is going to help affordability. Affordability is fantastic, of course, for those people that haven't lost their jobs, and my heart does go out to them. I'm not removing the fact that this whole thing has a huge health side to it.

I'm trying to stay focused on the economic side so that I can provide you guys the stability so that you can continue to educate your clients, I can continue to educate you, but yes, personally, we're all dealing with this, and that I don't take lightly. We also have highly qualified buyers. We had highly qualified buyers coming in, non-QM, which is the non-qualified mortgage, had only started ramping up. As you know, it's almost all been gone and it will be years before it comes back.

It's just too risky of a product. There's no buyer for the paper. It all comes down to is there an investor to buy the paper that I've got? Then we have a high amount of equity in this country. In fact, we have $15.8 trillion in home equity, meaning all the values of residential real estate in the United States, less all of the loans, we have $15.8 trillion in 2019. That's phenomenal, and as we know, 40% of all homes didn't even have a loan on them.

All right, so let's talk really quickly about this week and what we're seeing. Let me get out of here, sorry. All right, so quantitative easing, I feel like was likelier. To infinity and beyond, that's pretty much what was said, and this all started on Monday. I could go back and talk about everything else that the fed had already started doing, the money that they had already started putting in in the initial drop of the fed rate.

Let's just look at this week, because this week alone is mind-blowing every single day and the changes that we had. He said, "I am not stopping. I will send as much money as we need, we'll print it." The inflation we'll deal with later, we're taking care of the funding right now. Quantitative easing with no limitations. He was buying everything. Commercial bonds, residential bonds, mortgage-backed securities, as we know them, treasuries.

Any kind of government or muni bonds he was willing to buy, so in that case, he was trying to uphold any of the industries that he could. Small business loans were coming into a conversation at that point and the kind of monies, and then he had also instituted something called Main Street, which was given to small and medium-sized businesses. He kicked it right out of the gate on Monday, where he, Powell, had said $75 billion a day to buy treasuries, $50 billion a day to buy mortgage-backed securities.

Now, I want to take a step back just for a second, because all that sounds great, but from the mortgage perspective, all of that funding and all of that buying mortgage-backed securities, it creates a supply and demand where our interest rates are impacted and all of a sudden we're going to have situations where lenders are getting margin calls. We're going to go into that in a minute, but those margin calls are not a good thing.

When rates go down, individual lenders have to write checks, sometimes in the millions. It could be anywhere from $28 to $32 to $80 million checks per week for margin calls. All of that, buying mortgage-backed security sounds great, but it wasn't actually supporting our mortgage space, it was hurting us. Things have been changing with the stimulus package, so we're going to talk about just a couple of days later.

That happened on Monday, and on Tuesday we had a calm day. Home appreciation values came out, and I thought that that was so funny that everything is great and rosy, but remember, all of that is data that has passed, but we were still seeing strong home sales, strong home starts, and we were still seeing strong appreciation.

We will continue to see home appreciation and what's going into home appreciation, I'm getting this call constantly saying, "I've got people that are scared to buy because they think we're going to go through a dip and lose value in our homes." They're liking it to 2008. This is not that. If you look at the inventory statistics on 2008 versus today, part of the reason why 2008 happened, the recession didn't cause the housing bubble, the housing bubble caused the recession because we had too much inventory.

All of a sudden we couldn't sell that, we had all the foreclosures or short sales, and homes were going for bottom prices. Now, we will have some foreclosures in this market, and I will talk about that in a minute, but not nearly to the extent. As long as we have the low-interest rates, as long as we have the strong demand, and as long as we have the lack of supply, which we have right now, and remember, builders aren't really building right now because of lack of workers and supplies and funding, so we're going to continue to have low supply.

Those appreciation numbers will continue. Wednesday happened and we got a stimulus package, right? It got passed by the Senate and it's going to be passed by the House hopefully today, it's scheduled to come out. The COVID stimulus package is even more money, more specifically dedicated, so $1,200 checks written to every individual as long as you make less than $75,000 a year, another $500 per kid, $500 billion towards the airlines, which is beautiful.

It was $500 billion towards all of the industries, $60 billion specifically to bail out the airlines, $350 billion for small businesses to keep employees, $130 billion for hospitals, $250 billion to expand the unemployment insurance and services, $150 billion for state and local governments, so that's a lot of money. In that stimulus package is also the forbearance program. At first, Fannie Mae and Freddie Mac had come out saying that they were allowing a forbearance for up to 60 days.

That happened last week, so it's not on my schedule and charts here, but this week they're putting that into place where it's up to a year. They're looking at increments, so they're doing 180 days and then an additional 180 days. So they're looking at this going, "Okay, six months to start with another six months already pre-approved, depending on where the economy is." That forbearance opportunity is pretty wide open.

Every borrower and you as agents need to know this because you probably have clients asking, they need to contact their servicer. I'm seeing some scams already on the internet trying to get their information. Don't let them just go and do a Google search. Have them contact their servicer and get the process that they need specifically per servicer. Those services are supposed to give them all that information and provide it, and should they be able to say ...

Remember, this is a health thing, so you can't dig too deep, but if they say that their family or themselves are impacted by COVID, then they're going to be able to take advantage of this forbearance. Well, that sounds like a great thing, but again, this forbearance is going to hurt our mortgage industry, and it's specifically the servicers. I want to talk about that, but I want you to keep this point in mind because I want to finish the week.

Then I want to circle back to how this is impacting servicers and then why people are now saying that gov loans are going away and why I'm hearing some realtors aren't taking a government offer when they get it on their listing, or why I'm now hearing that some lenders are saying it's either, one, going away or, two, the restrictions, and it all comes down to do you have enough people to buy the paper?

This forbearance is causing a crisis in the mortgage industry. At first, it wasn't being addressed, but it is now, so the Federal Reserve is now putting together facilities to fund the servicing. They just have to collateralize the paper and they'll get enough money to continue that, so that's going to be a huge win, and we'll find out more after all of this has passed. Mortgage applications, not a huge surprise that they're way down.

In fact, we had had an 11-year high just two weeks ago, and then the dramatic declines that we had were the biggest drop since 2009. I only bring that up to say that those of us that are busy right now, we are going to see some level of a slowdown as this continues. The longer it takes to find a treatment plan is the longer we're going to be in this situation, and we're going to have the lack of apps and we're going to have the business slowdown.

What we had to do is just be proactive and I'm going to share with you some things that I'm doing in my free time to stay relevant, to stay educated, and to make sure that I'm staying on what's happening. Here was the big news for Thursday. As we come around, towards the end of the week, we got the jobless claims. I don't know if you could fully see the extremity of this change, so the highest that we had had in weekly jobless claims in history was 671,000 jobless claims in 1982.

That was the highest. Just last week on March 14, we had 282,000 people file for unemployment. On March 21st, the numbers came out, we had almost 3.3 million people file, and that number should be higher, but literally systems crashed. They couldn't take all of the applications, so next week when this comes out, it's expected to be higher still.

It is really interesting when I look back, and Mnuchin had started this last week, and I'd even talked about it at the Mobley agenting night, when he had said that unemployment was going to hit a high of 20%, the reality of that just didn't even make sense. The great depression was 25%, our great recession wasn't even 20%, so for him to say 20% I thought it was a bit extreme. Well, now I'm hearing it could be as much as 30%, but we have to put this in perspective.

This is a hard, fast, intense change. It's because people can't go to work, they're stuck at home. They have to file for unemployment, they're being laid off. There will be jobs returning as soon as we can go back to work and get released from our homes. We have to know that that's coming. Will it be the same? No, it won't and some businesses won't come back, but the businesses that can come back and can reemploy their people, they will see some level of normalcy relatively quickly.

This economic change right now, or I should say this recession, is not an economic recession. It is because of the Coronavirus, so let's go on. We wanted to show you really quickly, so we track the 2.5% coupon rate. That's a mortgage-backed securities coupon rate, and this chart is a big one. It just simply shows you that rates have been declining. As the coupon rate goes up, that means our interest rates go down.

We've seen that this has been trending up since November of 2018. That's what this chart is, but these are candlesticks, so every single one of these little moves, these little red and green movements is the change in the day. Check this out, so this has been my last two weeks. You guys, I am telling you, I can't predict what rates are going to do any day, nobody can. The size of those candlesticks is the volatility in every single day.

Every day we wake up surprised, and then throughout the day, we continue to be surprised as we have rate changes. We used to be able to watch the 10-year treasury and know where our rates were headed. We used to be able to watch the 2.5% coupon and know where our rates were going, but due to supply, due to the issues that we're having with servicing, due to liquidity, the system is broken. It just is. It doesn't have the connection, the partnership of those metrics to my results like it used to.

What we have to do is simply relate what's happening behind the scenes and how do I communicate that in a way that my clients understand and don't take it out on me if I'm not giving them a 2.99 rate that day? I'd be surprised, honestly, if we saw 2.99 for a couple of reasons. One, it dang near broke the system. We have $11 trillion in mortgage debt across the country. On an average year, we turn $1-2 trillion.

We expect it to turn $5 trillion, almost half of the entire bucket of originations, this year alone, and I promise you it felt like everybody was trying to do it on the same day. It broke the system. In addition, we have the servicing, and I want to quickly touch on that. If I'm an originator and I am originating a loan and I'm thinking nothing about, and I want to originate as many loans as I can, you want to close as many homes as you can. That makes sense.

I'm over here and I'm originating loans and I don't think anything about it. Well, when that loan ... Let me actually back up. Before that loan closes, when that person goes under contract, I give them a rate and I lock in that rate, but that rate is locked in as a promise between me representing my company, Fairway Mortgage, and that buyer or refinanced borrower. I lock in that rate and say I locked in that rate of 2.99, because why not?

If I locked in that rate, I have to commit to 2.99 to that borrower. Now, in the meantime, the rates are moving every day, as you saw. The rates are moving at massive amounts, and so I need to protect as a company, Fairway Mortgage, and every mortgage company needs to protect against the risks if the rates go higher.

Well, when that loan gets sold, when that home finally closes and you get to the closing table and you guys are all excited because everybody just got paid and they just signed and they got keys, well, truth be told, that's when we had to figure out, "Well, I locked that guy in at 2.99, but now the market rate is 3.5, so as a lender, I have to buy that rate back down to the 2.99 that I promised the borrower," and we do that.

In turn, if rates go lower, to 2.5, that's not going to happen, but then you have an upside. The upside pays for the downside and the risk. In all of that, we have insurance and if we get outside the scope of what a company should theoretically be living in, as you know, insurance carriers will only wait so long and so they have this thing called margin calls, and if the rates move too quickly, they don't want to burden that risk anymore.

They require the lenders to pay the margin call for the risk that they're holding against those rates. Now, if I as a lender am planning on closing that loan, I'll get paid back some of that money, but not every loan will close. I could be writing a check as much as $20 million, $50 million, $80 million in a week's time for margin calls. It's going to strain those lenders who are not liquid, and that's a real thing.

Back to my history, then that loan closes and it goes to a servicer, and that servicer is responsible for it, they pay for the right to service that loan because they collect the interest every month. They have to pay the investor who's holding that note, so that servicer sells the hard paper, the note to an investor, and then they have to pay the property taxes, the homeowner's insurance, and the investor every month.

Here's where we go back to the forbearance because that servicer has to pay that investor and the property taxes and the insurance, regardless of whether or not they have any money coming in, but they had no money coming in. Well, servicers expect that to some degree, but these percentages are through the roof right now, which is why a lot of servicers were saying, "We can't buy any more loans, or we're not going to be able to fund these."

We've got a lot going on with the servicers right now. Now, luckily, Fannie Mae and Freddie Mac have a limit on that. They say, "Well, the servicer has to pay at least one payment to the investor if they don't receive a payment," and then you could start foreclosure proceedings, and the whole thing goes on.

Government loans didn't have a limit, so that servicer had to keep paying that investor for as long as that note was held because that participant or that buyer got a government loan and is in forbearance and is not making their payments anymore. That servicer is starting to seize up because they're still having to pay, but they don't have any money to pay because they don't have money coming in.

Therein lies the problem with the government loans and why people are starting to figure out "Can we continue to originate, because will anybody service them?" and you can't do all your loans with cash. We've resolved the fact that there are going to be some lenders that aren't going to be able to do the government loans. Having said that, there's a lot of money coming in from the federal government to protect these servicers. Now, all of those conversations started this week.

It also has to do with the fact that those loans were going to try to protect, so when you start seeing all of the lenders start to say, "Well, we're going to tighten the credit box, meaning we're going to increase the credit score, we're going to reduce the debt to income ratio," it's because they're trying to protect what they can sell.

Who's going to be the investor for my paper? Because interestingly enough, that 2.5% coupon that I'm watching, that mortgage-backed security might've started out as a 3.5 or a 4% mortgage interest rate that your buyer's closed on. Then they went to the servicer and the servicer took a little bit, and then it went to the aggregator and the aggregator took it a little bit, and then it went through the chain.

Now that that mortgage-backed security landed in an IRA or 401(k) at a 2.5% rate that you and I invest in, so we're paying for our own mortgages but after it has gone through the system. I hope that I shared a little bit about what's going on. I know we're going to have a ton of questions and I'm almost done. We have to remember that when this is all over, we are going to get to a place where life is going to return to normal.

If you think about it, you've been trapped in that home with your kids and your spouse, and all of a sudden you're going to want to go out to eat. Because you want to stop eating the home-cooked food and restaurants are going to get busy again, and the sons and daughters and siblings are going to want to go visit mom and travel, and airlines are going to get busy again. All those sports fans that have been eager for all those games are going to buy tickets to any games they can.

The music fans who have been diligently listening to music online, and I've seen some great concerts online, they're going to want to go see live events and the ticket sales are going to go up. Those athletes, like myself, that have been itching to go, well, then all of a sudden the gym memberships and all of those athletic fields are going to start going up again and, interestingly enough, my question is how sick of that house are they going to want to be and move?

Interesting, Home Depot and the maintenance services, those stocks are actually doing well right now. A few sales are up, people are ... They're stuck in their homes, they want to paint, they want to fix, but will they want to live there when it's over? I don't know, might be an opportunity, and certainly a reason I would want to stay in front of my database and communicate with them.

Here are three things that you can be doing right now because I told you I was going to leave you with some things that specifically you can do to continue to take advantage of the time that you have. Whatever pauses you have in your life right now, find new friends but keep the old. Ones like silver, ones like gold, that's the old saying from Peter's mom. My husband's mom chimes into my head all the time.

Stay top of mind. Keep relationships building. Get on the phone. Call people, check in on them. Be relevant. Call three old clients, call three current, call three new, just whatever you can do to continue conversations and see how they're doing and be a servant. Then, video techs, anything you can do where they can see their faces. Social media, we're doing a ton of live videos. Knowledge is power.

Commit yourself to pick up that book that you haven't read, reading two articles a day, getting yourself involved in what's happening so that you could start to see how this is unpacking and where can you go from here. Housing Wire is a great resource, NAR, CAR. I just saw something on NAR, they had a whole series of technologies and training that you could do, so that's a fantastic resource, and then walk the walk.

I was talking to somebody last night and they were like, "I was driving through and they were taking pictures and checking out a house and it was that eerie nobody's on the streets, people are all out on their porches looking at me, and it's like, 'Okay, did I just invade a space?'" It was so funny, I was dying laughing, but it's that. People are sitting on their porches, they're relating to one another, they're talking.

Granted, stay six feet away. Social distancing is a very real thing, but have that time and get friendly with your neighbors. This is the time to do that, and then if you guys need something to listen to, you need some educational materials, I started up a podcast about a week ago. There is already a ton of content in there, and you can load that up from your favorite podcast sources, whether that's Apple, it's already on Apple, it's on Blueberry, Tunein, and Google Podcasts, so check that out.

Nicole Rueth
The Rueth Team of Fairway Independent Mortgage Corporation
750 W Hampden Avenue, Suite 500
Englewood, CO 80110

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Your Questions Answered Forbearance, Rates, Fannie and Freddie

This episode followed the first portion of the new Agent Ignite Coffee Talk series on Friday mornings. This week questions poured in including these topics:

Forbearance, Unemployment claims, HELOC rates, FHA loans, investor rates, furloughed limitations in qualifying, COVID-19 addendums, rate locks, jumbo loans. Listen to this episode of The Double Comma Club.

You can get more information about joining in here. 

Coffee Talk:

Agent Ignite:

Do you actually read faster than Nicole can speak? Even after three cups of coffee? Then read the transcript below:

Cara: We definitely have a few questions, so the first one that came through was, Are there any negative ramifications to forbearance on credit scores and different things like that?"

Nicole Rueth: Fantastic question. Okay, so Fannie Mae and Freddie Mac said "no" right out of the gate. The government didn't, so it was actually up to the servicer. It was strongly recommended, but not required, and that's changing. With this stimulus bill, one of the things that they're saying in there is that that has to be honored and the credit won't get destroyed or there won't be any negative lates.

Remember, they're going to have to catch up and there will probably be some foreclosures because of this, but whatever mortgage payments were missed are just going to be tacked onto the end. Most people don't make a full 30 years of payments, so that balance due will be paid when a refinance happens or a sale, but that's just going to be tacked onto the end and have to be made up. If you think of, especially those who are the majority of our FHA borrowers, they are entry-level homes.

We have this increasing population that's coming in that wants those entry-level homes. I'm not worried about that supply coming into the market and even it really depressing our appreciating values at all.

Cara: Then, do you think investors that are not receiving rental income will need to sell those properties?

Nicole Rueth:  I love that question because I think, as an investor, I'm looking for two opportunities right now. Because, remember, as mortgage holders, so as a homeowner, I can go through forbearance and I can stop making my mortgage payment. The same applies to that, it was stated, you cannot evict during this time. Landlords have to be ... I don't want to say kind to their tenants. I'm always kind to my tenants, but we have to be understanding; you're not going to evict somebody in what's going on right now.

Some people, I guess, would, and so they're mandating that you can't evict them. The same thing's going to happen. You're either going to have to have that tenant catch up or, once this is over, you're going to be able to evict them. There are investors who have done well over the last eight years. It's my expectation, and there are no numbers that qualify what I'm saying, it's simply my being in the market and what I think is going to happen.

If I was an investor, and say I was 65 or 70 years old and I had all these investments, I might just take my chips off the table now. I might just say, "I had a great eight years, I've got a tenant who's not paying or maybe we just came out of this." There are hungry investors who will buy that investment, who have a little bit of money reserved and they know, if they can just hold on for the next two to four months, maybe six, then they're going to have an appreciating asset and inventory that they didn't have before, so the buyers will come in.

I don't think it's going to be a fire sale. I think you're going to pay fair market value, but I think that there's going to be investors. There were at least some of their inventory during this time. The other opportunity I see is in commercial space. I think that there's going to be some commercial buildings, regretfully, because of businesses in the next six months.

Cara: Yep, definitely. Then this next question was in reference to when we are looking at the different unemployment claims. It says, do you know what the percentages in claims were when you look at the population in 1982, and then you look at the current population and the percentages?

Nicole Rueth: I don't have the percentages yet right now because unemployment always lags, so that unemployment number is still sitting at lows, but it won't as soon as that comes out again. That's an excellent question and I can do some research and see if I can find the answer and even post it up in the Agent Ignite group.

Cara:  Then the next one is somebody was wondering what was happening with HELOC rates.

Nicole Rueth:  Well, there are HELOC banks that are stopping. I know Bellco stopped taking any new originations, I know KeyBank stopped taking any new originations, and they're not closing their doors, they're just not taking any new originations. I'm hearing a few others that are about to do that as well. I've taken a poll of all of my folks, so if you want any names of people that are still doing the HELOCs, there are still some, I can give you the contacts that I reach out to all the time.

I'm happy to do that, but as far as rates going up right now, the HELOC rates are going to be tied to prime. Prime's not going up. Prime is not necessarily tied to the mortgage-backed securities, it's tied to short-term rates, so I expect those to probably be good for another couple of years. At some point, they will go up and there's risk associated with that, but I'm not worried about it quite yet.

Cara:  Awesome. Somebody, in the same general scope, was wondering if anything, in particular, is happening to VA loans.

Nicole Rueth:  The same as gov. The FHA and the VA are the same, so we're still doing them and we will continue to do them. I don't foresee us stopping FHA or VA. In fact, I just took a number of FHA loans from another lender who's choosing not to do them, and I understand. Some lenders, let's just put this on the table. Fairway Mortgage, we're an employee-owned company. We are extremely liquid and we're well-founded financially, and we have a phenomenal leadership. That's a little plug for Fairway.

The way we're going about this situation is we're taking every lesson that we learned in 2008 and we're making sure that we react quickly and then we save the ship. We're making sure that everything we do allows us to continue to do business. Our decision earlier this week to stop originating jumbos and then mid of this week stop originating CHFA was a pause. Neither one of those has stopped entirely.

It was a "Let's see if we continue to have investors to buy this paper," because you have other lenders that are continuing to churn out those originations, and they might close in March, but if they don't have anybody to buy that paper in April, they might not have any warehouse line left to originate any more loans. Then we had to see what was going to happen with servicing, so there's a lot of unknowns the way this particular crisis is unfolding.

I personally would be much more comfortable knowing that my company is making a few decisions, maybe even ahead of the curve, but decisions to protect the 85% of the business, which the 85% of the business is vanilla. It's your Fannie Mae, Freddie Mac, VA, FHA, and there we are extremely secure and we will continue and we'll pick back up on the jumbos and the downpayment assistance maybe in a couple of weeks or a month.

As soon as we see servicing picking back up again and being well-funded and investors buying the paper.

Cara: Then we had a question on when the dust settles, how much will buyer demand to be affected by the buyers that were good to go, having to then re-qualify, and will that cause any lag, and if so, how much?

Nicole Rueth:  I don't think it's going to cause any lag. Many banks can, we can get a qualification out in a couple of hours. Other than if you have a temp employee or an hourly and you need verifications of employment, that kind of stuff is a little bit slower. Right now we're dealing with third-party services, so the IRS is having a huge delay and even a gap, in some cases, on the 4506-T, so that's the verification of your tax returns.

Every time we're getting something, and then, of course, the home inspections of the appraisers. We're finding solutions when we're coming up against a problem and the whole industry, I'm pretty impressed, is moving pretty quickly to say, "Okay, so an appraiser can't go into a home. Here comes Fannie Mae, Freddie Mac, and the government, and FHA will follow suit saying a desktop appraisal is okay, or a drive-by is okay given the circumstances," so we're getting solutions very quickly, especially in this ...Everything's happening in a condensed ... If you go back to '08, it took six months for this stuff to unpack and dissipate, and this is just happening. It's like a year in a day. It's amazing to me.

Cara:  Got you. Then somebody was asking what the investor rates were right now. They had a couple of clients wondering what that was like.

Nicole Rueth: I'm not even going to quote a rate on something like this right now. Investor interest rates are higher, obviously than primary homes. Primary homes and second homes are the same interest rate. Investment rates might be a point higher. I would be shooting myself in the foot if I actually ... Because, like I said, if we're quoting anywhere from 3.25 to 4.25 on a primary home, depending on the day, and depending on the scenario, maybe we're quoting 3.875 to 4.99, in that range. It so varies.

Cara:  Alex asked with it being harder for people to get government-funded loans, what do you think a safe credit score and DTI limit would be for first-time homebuyers looking to get into a home now that there's limited downpayment assistance?

Nicole Rueth:  That credit box will tighten and it will tighten until we get through this. We're already seeing some announcements coming out. Fairway's announcement will come out. All of us are saying because we used to be 580 for VAs and 600 for FHAs, it's all going to start to look more like a conventional box because we're going to have to make sure that we have sellable paper. We have to have a loan that we can then sell on the secondary market.

Cara:  Kelly asked can people still qualify for loans if they'd been furloughed?

Nicole Rueth:  Had been in the past or currently ... Been furloughed. I was thinking forbearance, my apologies. If they have been furloughed, it is going to depend. If they don't have a paycheck coming in, sometimes when people are furloughed, they still get a base pay, but if they're not getting any pay at all, they're going to have to wait until they get some sort of payback. We're going to have to qualify them on something, whether that's a cosigner.

I just did another couple, one spouse was furloughed but the other one had enough employment that we could qualify them to still buy, so it's taking a look at each individual case and finding the solution. There's always a solution in there somewhere. You just have to work hard enough to find it.

Cara: Then, someone asked, on the brokerage side, we have a COVID-19 addendum to put the RE contracts on pause. Are rate locks being paused or extended on the lending side?

Nicole Rueth:  We have not had a pause yet, so the rate lock is a very real cost and it all goes back to the insurance that we have to place and then finding that and the margin calls, there is a very real cost to locking in an interest rate. At this point, I have not heard, honestly, and I will ask that question. I have not heard of any non-cost-related pause; I've only heard of having to pay to extend the rate.

Cara: Got it. Then, we have somebody who's wondering how you can help buyers who would need a jumbo loan, how can they best help them now that those are limited or nonexistent?

Nicole Rueth: Yeah, and they're definitely limited. There are some banks that I know for a fact are still doing them. The interesting thing about that is when the other lenders are taking a position of lowering their risk by not doing them, and all of them start to go towards the few banks that are still doing them, those banks won't do them very long because, obviously, their percentage of risk is going to go much higher.

Then the question is just because you lock it doesn't mean it's going to close. We're going to find that, after all these loans that close in March, there are going to be some lenders that might have liquidity issues, that are having problems locking, and we just saw Zillow canceled all their contracts literally days or a day before closing. I don't know that that'll be the last time. I'm not worried about that at all with Fairway Mortgage, not even a little, actually.

The solution on those is I still have second lenders, so I would do a first and second loan. I'm still doing a number of those and then we would just refinance them in six months into a jumbo loan because the jumbo loans will come back. It's just a pause.


Cara: Are conventional loans going to be required to get forbearance under current legislation?

Nicole Rueth:  Freddie Mac and Fannie Mae came out saying that they were allowing a 60-day forbearance. FHA, gov, came out saying that they were highly suggesting it. That will change with this stimulus package that is getting approved today, so all of them will have access to the forbearance.

We're going to do this again next week because it's happening. Every day something's happening and I'm getting out on videos as much as I can. Guys, keep watching the social media, I'm just sharing everything I find, so if you have questions, even e-mail me and I can post about it if it's a big thing or I'll just stop and answer that, but definitely stay tuned.

Every week we're going to do some version of this, making sure that I'm available, answering questions, sharing what I have learned that week because I'm learning a lot every single day. All right, well, thank you guys so much for joining us. I'm looking forward to chatting with you soon. Bye-bye.


Agents - time to practice lightness, levity, and leadership.


Stefani Shock joins Nicole Rueth in this Agent Ignite special edition from March 2020. The overall theme is calm leadership is what we need - lightness, levity, and leadership. You need to shift into a sales mindset and be a calm leader for your clients. That's what they need.

In addition to this productive coaching session, Stefani walks agents through rethinking, reconsidering Facebook Live and other video options to reach prospects, stay of value to clients, and continue to be a resource of knowledge for all things real estate. This episode comes on the heels of Nicole's outstanding wealth of statistics, facts and ideas she shared during her monthly Agent Ignite session. It's time for all of us to use our expertise to lift up our collegues and clients as they hold on tight during this current shift in how we do things.

Catch the previous episode here. 

Guides for You to Help Your Clients Design a Strategy to Maintain and Hold On

Stefani also suggested a couple of items to make it easier for you to create videos on your own, with very little cost or outside assistance.

Motion Stabilizer suggestion for Apple products.

External mic for iPhone.

Tips for Facebook Live interviews with your strategic partners, vendors, clients, agents:

1. It cannot be done from Safari if you are using a desktop app. You'll need to use Chrome.

2. If using your phone Facebook app, be sure to turn your phone sideways to allow for side by side display BEFORE YOU GO LIVE.

3. Set up your guest ahead of time to join your live session, then, once they are in, you can see them in viewers, and invite them into the side by side session.

4. To add someone else, you'll need to x out of the other person and then invite the next person.

For those who attended the live broadcast, they received a coupon for Stefani's ebook. Learn more about the Agent Ignite series from Nicole Rueth here >

About Nicole's guest:

After ten years in the industry selling property in Manhattan and luxury homes in the Bahamas, Stefani Shock became a full-time coach and consultant to realtors and brokers. She increased the income and the happiness of her clients and students through her online courses, one-on-one, and group coaching. From Rookies to Seasoned Brokers, she delivers results.​

Guides for You to Help Your Clients Design a Strategy to Maintain and Hold On


What's the state of the market? If you think about where people's heads are, where their fear is right now, they're trying to control anything. Anything. If I can control the milk that I have in the refrigerator and the toilet paper that I have in the closet, I feel like I've got some of my control back. Toilet paper and milk are fundamental. It goes back to being a youth. This wasn't a matter of a run specifically on toilet paper.

There's too much going on to leave it to chance. Customers still want that zero rate. It doesn't work like that. As the Fed rate in the chart below, the blue line is the federal funds rate and the red line is our 30-year fixed mortgage rate. 

Please note specifically the area from December 2008 to December 2012. That Fed rate was zero. It was on the bottom, which is where we just went, and that mortgage rate never went below three. In fact, that rate was between 3.3 and 5.5 for those entire seven years. Never two. Never 2.7 or even three. It was 3.3 was the lowest. Anybody that can get a three and a quarter, they better run and get that. We're watching the rates right now and Freddie Mac is always a week behind, so this will pop up even further when it comes out. But we're watching what those rates are and I'm watching them every single day. I'm calling the people that I can and we're getting them locked when we can and it makes sense.


Please note specifically the area from December 2008 to December 2012. That Fed rate was zero. It was on the bottom, which is where we just went, and that mortgage rate never went below three. In fact, that rate was between 3.3 and 5.5 for those entire seven years. Never two. Never 2.7 or even three. It was 3.3 was the lowest. Anybody that can get a three and a quarter, they better run and get that. We're watching the rates right now and Freddie Mac is always a week behind, so this will pop up even further when it comes out. But we're watching what those rates are and I'm watching them every single day. I'm calling the people that I can and we're getting them locked when we can and it makes sense.

We can't get all wrapped up in the fear of it any more than we can the coronavirus. I don't want one more email telling me about COVID-19 update, right? I know it's going on. Ask yourself these questions:

  • How am I relating to my clients?
  • How am I the rock to them?
  • How am I expressing positivity and looking for the silver lining?

It's about talking about housing because housing is where it's at. Housing is going to be the thing. It came in strong and it's going to leave strong and it's going to be the thing that continues to grow well. Help your clients not lose their house. Help your clients design a strategy to maintain, hold on, this is not going to last that long. This recession was going to happen regardless.

Listen to the full episode for valuable insights and information you can share with your clients.

This show is produced and sponsored by The Rueth Team, with your host, Nicole Rueth.

Your home purchase has a long term impact on your ability to build financial wealth. We at the Rueth Team will continue to be alongside you well beyond the closing table. Whether helping to refinance a loan, transitioning to your next home, or building multigenerational wealth through investments, we are committed to finding YOU solutions other lenders can’t… or simply won’t.

We look forward to helping you build wealth through real estate by generating passive income for a more financially secure future. Get started by visiting  Your resource for helping you build wealth through real estate.

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