Torii’s Chief Revenue Office Mike Sokolowski talked recently with Hunter Evers, mortgage officer from Fairway Mortgage (based in Back Bay, Boston), about the current mortgage loan trends for homebuyers. Read the key takeaways from their conversation or scroll to the bottom of this post to watch the 20-minute video on our YouTube channel.

Key takeaways:

• You don’t need to have 20% down payment to buy a house right now. Hunter notes that most clients are doing 10-15% down payment right now, but there are even great programs if you are only doing 5% down.
• When you are putting down less than 20%, that is going to force mortgage insurance onto your mortgage. If you put down 10% and have a good credit score, you could only be paying $60 or $70 monthly payment mortgage interest payment. (Zillow and Redfin mortgage calculators say somewhere around $200-$300 per month PMI – percentage points – which is just inaccurate.) It’s far more accurate to speak with a mortgage rep over the phone if you know your credit score, how much you want to put down, etc., than to use an online calculator.
• The real estate buyer pool is huge right now, especially with more people getting comfortable with the amount of the population vaccinated against coronavirus, especially in MA. We are seeing more home seller inventory coming on the market, because people are getting comfortable with doing open houses and letting people walk through their homes. Home prices, though, are still high.
• This time a year ago, Hunter was talking with new homeowners about uncertainty: Buyers weren’t going out to open houses or on showings. March of last year people really didn’t know what they were going to do. As a buyer you probably got a great deal as people started to retract from the market. Opportunistic people who purchased a home probably got a good price. But a lot of people went into hibernation and their pre-approvals weren’t good anymore. “At that time, we did a lot of refinances.”
• 30-year fixed mortgage interest rates are so low that buyers will continue to watch the inventory with the hope of buying a new home. Refinance rates remain low, too.
• E-closings have become more popular because of COVID restrictions. Mortgage bankers have had to become more agile.
• Upfront underwriting helps you be more competitive as a buyer. It helps to set a buyer apart because they have a mortgage application and pre-approval letter, but at the same time the loan application is submitted to the underwriting team to move clients from “the batter’s box to third base” while they’re out looking at homes. The underwriting also allows you to close within two weeks, which makes your application the next-best thing to a cash buyer.

“If I had to guess, I’d say we are looking at another 24 months before the inventory is back to normal. There is so little inventory that sellers know they have this awesome piece of property that they can sell in two seconds, but then where are they going to go?” -Hunter Evers, Fairway Mortgage

Or watch the full video on our YouTube channel: