Patrick Gentry

This one might be a little bit sales-y… but hear me out! When you’re in a commissioned base job (or self employed) it generally doesn’t work for you to “hold back.” Logically I’ve known this, I’ve been in commissioned sales for 6 years. For various reasons not particularly interesting I’ve often made decisions to not do what was common among my peers. I felt like holding onto these things gave me some control of my destiny and wasn’t “necessary” for me to do my job effectively. For a while I was right… then things started changing.

For those who haven’t tried buying or selling a home in the last 5 years, let me tell you, 2020 and 2021 were legendary years in mortgage. Rates were low, prices were reasonable, and people had money for down payments. With limited experience, I managed to close a number of loans that would make 10 and 20 year veterans in the space green with envy. All this accomplished without promoting myself on social media, giving out my personal cell phone, and limited effort on the weekends.

Enter 2022… inflation is on the rise, and so are interest rates, and home prices. I began to realize that I would need to make some changes if I was to continue to survive in the industry. The easiest things to change was to my explicit to customers my availability on weekends and evenings and to give out my personal cell phone for ease of access. I was most afraid of this, it felt like I would be answering calls and texts at all times and having to give up family time. The reality was customers are usually understanding of my time and when they do reach out, it’s important (like making an offer or issues impacting closing). It was actually a blessing since having easy access to me, also meant I had easy access to my customers too. It was a win-win.

So why write this now? Well, because social media. I have largely given up on big scale, algorithmic social media. I’ve kept my facebook and instagram accounts, largely so I can still use modern-day Craigslist, aka Facebook Marketplace. While I don’t love giving my personal data away for free to the world’s largest corporations, the people I care most about (my family, church, and referral partners) are all on facebook/instagram. And so I’ve started posting stories and getting back into that world to make sure I’m were my circle of people are too. I can already feel a difference in how I’m connecting with people and I think this may be a final missing piece of going all in.

Believe it or not, this isn’t about social media. With this final(?) piece of letting go, I can feel my mindset shift. I’m approaching business differently than I had last year when I wasn’t doing anything with social media. I feel like I’m approaching everything with more clarity and focus largely because I’m not “holding on” to something that wasn’t that big of a deal in the grand scheme. While I would love for my whole circle to own their social presence (micro.one is a dollar per month guys!) it’s just not realistic to stay in touch with my larger circle in niche smaller circles. So I will do both!

For the mortgage nerds out there… Closing costs are high on home purchases and refinances without a lot of ways to reduce them (most title companies are going to charge the same fees). However, a little used option folks can use is premium pricing. In effect you take a higher interest rate in exchange for your lender paying a portion of closing costs. This can be handy especially in a situation where you will be selling or refinancing your home again in the near future.

www.nationalmortgagenews.com/news/clos…

Congratulations! Buying your first home is no small thing! This guide isn’t meant to replace your loan officer (but if you have questions beyond the guide I’d love to talk, email me here).

Do’s:

• Talk to a Loan Originator early in the process
  • LOs want to help you get ready and a good one doesn’t mind talking to you months or even a year in advance to help you get ready!
• Have your financial house in order
  • Do you need to have perfect credit? No, but the better your score the more options you will have!
• Know the roles of your team
  • Your loan officer will be the person who helps navigate the financials and loan programs.
  • Your realtor is a local area expert, they are there to help you navigate the contract and offer process and be your advocate speaking with the seller’s side of the transaction.
    • Loan officers don’t make for good realtors, and realtors don’t make good loan officers!
• Save for down payment and closing costs
  • In general you should plan to save up for a down payment of 3 or 3.5% of the purchase price. (100,000 x 3% =3,000 ). Closing costs vary from state to state, but a good rule of thumb is planning for an additional 6000 to 10,000.
• Have an idea of what your maximum monthly payment needs to be. Your loan officer can back into ideal purchase price with this number.
  • Most online mortgage calculators actually do a pretty good job of calculating your payment. Be aware that they often will sell your information to online lenders who will then proceed to call you… a lot.
    • Here is a calculator from a reputable company
• Ask your loan officer about special programs, down payment assistance etc. Not all programs are right for all people, but always ask!
• Get an inspection.
  • I recommend getting your own inspector who is not referred by your realtor (or even your lender). Having a true, uninterested third party separate from the transaction can save you a lot of headache in the future!

Dont’s:

• Add additional debt
  • Will this disqualify you on the spot? Not necessarily, but a lender has to get explanations for any credit pulls you have gotten recently and if you’ve added debt these have to be accounted for and added against your budget. It basically adds more paperwork and friction for you (and it may disqualify you due to budget if things are too tight).
• Quit your job!
  • Seriously, income is one of the most important factors on your loan, you need to keep your job situation as steady and predicable as possible. Don’t start changing your schedule, or how you’re paid (going from salaried to hourly, or from hourly to commission, or W2 to 1099, or full time to part time).
• Commit to a realtor or LO at first contact
  • The beautiful thing about being the buyer is nothing happens without you! No one gets paid, and a home doesn’t get sold until you commit to buying. This is too important of a life event to work with someone who isn’t treating a multi hundred thousand dollar transaction seriously.
    • Do remember that LOs and realtors are paid a commission however, if you know you’re moving onto someone else, we would appreciate the “breakup” call or text so we can move on. No one likes working on the weekend for a deal that’s not going to happen.

Basically all these points could have an “in general” behind them, but if you follow these guidelines you will be largely setup for success! Again, email me here with questions and I’ll be happy to touch base with you!

As we enter yet another week of higher interest rates, it just seems like complete foolishness to talk about a new mortgage, much less a refinance… right?

It’s worth noting that the cheapest way to borrow money still is borrowing against your home.¹ So if you have a need, even with these higher rates, it can still make sense! There are two major things you want to consider before jumping in. If you want to talk about your specific circumstances, you can check out my about me page.

The first consideration is closing costs. These are the costs your lender charges, plus third party fees(title, credit report, appraisal, etc). Every time you do a mortgage loan (purchase or refinance) these fees apply. This is important to remember when refinancing when rates are a bit higher, because you will likely want to refinance a second time when the rates come back down. These costs can add up quickly! Thankfully there are options you can take to reduce or eliminate these extra costs in the form of credits. Often lenders offer an option called premium pricing. This is when you will take a slightly higher interest rate in exchange for lender credits. These credits can be used to offset your closing costs. This is a great way to not be “moving backward” with mounting loan costs by doing multiple refinances.

The second consideration is your term. If you’ve been paying on your mortgage for a few (or many) years going back out to a 30 year term can really impact your long term interest expense. I know most of you know about the 15 year mortgage (Dave Ramsey thinks this is the only mortgage worth getting). I’m here to tell you a less commonly known tool is the 18 year mortgage, the 21 year mortgage or the 27 year mortgage. Not all lenders offer custom mortgage terms, but several do and it’s worth discussing what a couple of years would do for your interest savings with your loan officer.

As always, there’s a lot of nuance when it comes to borrowing money. Not everything comes down to what interest rates are doing today.

^{1. In general. If you make enough phone calls you may find one weird lender who has crazy rates doing some crazy niche program.}