On this Storii Time episode is longtime Torii partner & Loan Officer Pat Walsh gives our listeners tips on getting the best rates when buying a house.
Mike: That is the smoothest the guest has ever logged on.
Pat: I told you I was technologically inept too, so I’m proud
Mike: Well, you’re surprising me, right now.
Pat: Good. Good.
Saad: It’s much better than Tony arriving five minutes before the live ended.
Pat: Yeah. I’m already off to a better start. I’m trying to get the lighting. There we go.
Mike: What’s up, man? Looking good.
Pat: Thank you. Appreciate you too. What’s new?
Mike: You know? Spring market.
Saad: Just doing these lives every week.
Pat: Yeah. You guys are killing it. It’s awesome.
Mike: Yeah. For to our dozen fans, we appreciate you.
Pat: It’s 12 more than I have, so it’s good.
Mike: Love our tens of views.
Pat: After this, you might have one more. I bet my wife will watch. So that’s perfect. That’s what we’re talking about.
Mike: That’s a supportive partner. That’s great.
Pat: Exactly. That’s great.
Saad: 100%. Mike and I were literally talking about, I think it was, late last week. We were talking so every Monday, I put up the Monday rates check.
Saad: We were talking about how, like, it’s so misleading. Because every situation, every type of property is different. Every market is different. All that kind of stuff.
Saad: And that’s what kinda led to, you know, try to bring you on to have a conversation about, like, what you’re seeing in the market, what’s working for people, what’s what are the types of products that are working for people? Mike had mentioned arms earlier.
Saad: So excited to kinda hear what you have to say and and see where the market’s at.
Pat: Yeah. So, I mean, that’s the question I get, like, every day, 50 times a day. What’s my rate? What’s my rate? So it’s just there’s so much that goes into it.
Pat: There’s credit score, locations, down payment size, property type, debt ratios. Like, there’s so much that can impact that rate. Or, like, if you have debt ratios that are on the higher end, you’re not gonna qualify for arms because the arms generally have to qualify you at a higher rate.
Pat: So those are all things that people just don’t understand when they come, hey. What’s my rate?
Pat: My cousin got this rate at, you know, 6%. Why am I at six and a half percent? So, I I think that’s a pretty good thing that I try to educate people on right off the bat because it’s not one size fits all.
Mike: Yeah.
Pat: it’s not, you know, just because your cousin got one rate doesn’t mean you’re gonna get the same rate. Maybe you’re better. Who the heck knows?
Pat: But, yeah, to your point, arms are definitely I’d say probably more than 50% of the loans I’m doing this spring have been arms.
Pat: I think everybody’s kind of under the assumption that rates are gonna come down at some point in the next, you know, hopefully five to seven years. So if you do a five year, seven year arm, you’re probably gonna refinance. Even if you do a thirty year fixed, you’re probably gonna refinance. So they’re kinda taking that gamble.
Pat: Hey, I’ll save a couple $100 a month, you know, for the next five to seven years. And, you know, we’ll roll the dice is really what I’m kinda seeing.
Saad: I’ve heard from people, like, Mike, I don’t know if you heard this too, that are like, the environment for arms is not that good right now, which I found surprising, and maybe I’m missing something. But, like, I found surprising because naturally, rates are high right now. Arms would I mean, arms for those people who don’t know, like, you know, your rate is lower for a certain period of time, you know, adjustable rate mortgage. So for five years, seven years, ten years, whatever, that’s what Pat’s talking about here. And Pat’s saying that a lot of the loans that he’s doing are arms because, again, rates are high, and there’s a, there’s a thought that rates will go down.
Saad: So, Pat, to that point I just mentioned, like, you know, maybe it’s like a lender specific, right, that some lenders just don’t have good on products. So can you talk to us a little bit about that? Like, why does it differ between one bank versus another, one lender versus another?
Pat: So great question. LeaderBank, we work with a lot of smaller community banks, and a lot of the products they do are armed. So the way that works is, you know, think of, like, small credit unions, whatever. They don’t have a a mortgage guy like me that works for them, And they’ll contract us, hey. You know, here’s $1,015,000,000 dollars. Here’s our parameters and here’s our rates. And it helps us to have access to better products than what’s on the secondary market, you know, price into the big banks, the chases, the city banks, The US banks, which we all have access to, but they don’t have great arms. So these smaller credit unions right now tend to have the better products for arms. So we’ve had a lot of success with that. You know, it is lender specific, to be honest with you.
Pat: Like, last year, if we talked to this time, there wasn’t a lot out there for arms. There was just it was was almost like people didn’t know how to price them because they didn’t know what the what the next five to seven years was gonna hold. So when we were a little skittish. And to be honest, like, a lot of times, arms priced out higher than fixed rate mortgages, so you would never do it. It has to be the right buyer, though.
Pat: It has to be someone, like I said earlier in the conversation, debt ratios are on point, credit’s good. Mostly, it’s 20% plus down, because that’s just the way that those products work is they’re a little riskier. So they’re gonna kinda cherry pick the best of the best and be able to to have those people have access to them. If you have three or 5% down, an arm is not gonna work.
Pat: There’s not really anybody that’s gonna be no investors really gonna take that risk, to be honest with you. When there’s mortgage insurance involved, obviously, the risk is a little less, but still, like, in adjustable rate mortgage, you just if someone has that little down into the market, went the other direction, then they’re upside down pretty close with an arm.
Saad: Yeah. Yeah.
Pat: So that’s they’re they’re riskier to the investor in that sense. I don’t think that they’re a risky product. The, you know, they got a bad rap during the housing meltdown in 2008 because there were a lot of people out there that were getting loans that shouldn’t have gotten them. Had nothing to do with the product they were in. All those people were doing, you know, one year arms and interest only arms, and they had no income docs that they were using.
Pat: So, like, they would just say, hey. I make a $150,000 a year, and banks are giving them a loan. So that’s a totally different thing. But arms got a bad rap because of the movies, like, the big short. Where they’re talking about the right? Like, that’s what people reference to.
Pat: Like, oh, I’m not gonna do an arm. I’m not gonna put myself in in a bad spot. But if you get educated on it, it’s a pretty good product to save yourself, you know, that money.
Pat: Because that’s I mean, you’re gonna save upwards of $20 over of interest over the life of that five to seven years depending on your loan size. So if your loan amount is is $20 last five years now because you took a gamble, you’re gonna be pretty happy. That’s kind of the way I look at it. So, but, again, you gotta some people are just skittish and they don’t wanna do it, and it is what it is. It’s not for everybody. But if you can educate people on it, I think it’s a it’s a good way to kinda get people to cope with the higher rate environment where, you know, mortgage payments are definitely a lot higher than they were three years ago.
Mike: The, well, one, I hope you don’t feel objectified when people are just talking about your number. I hope they ask you how you are personally as a human being.
Pat: Nobody ever does, Mike. It’s a lot of times.
Mike: Just a piece of meat. It’s too bad. That’s it. So on, like, laying the landscape here, there’s been it’s just been month after month of, oh, they’re gonna they’re gonna come down maybe, and then there’s maybe, like, a blip, and then we’re back up. And it just seems like the tension of months and months of that, is is on the buyer’s mind. So just like, you know, snapshot last month or two, what are your conversations with people? What are you recommending to do?
Mike: Say it’s your kind of like average 10% to 20% down payment buyer. You know, what are you recommending to people? And when it comes to either arms or rate buy downs in a specific circumstance, what’s been a good kinda go to move for you? The last call.
Pat: Rate buy down during the spring market, it you’re not really gonna they’re usually more beneficial when a seller pays for it. But in this market right now, as I’m sure you guys are seeing, like, there’s you’re not getting many seller concessions to to buy your rate down. Right? If you’re done buying down yourself, it’s not nearly as beneficial, I don’t think. But, again, everyone’s got their own unique scenario.
Pat: So the most buy downs that I’ve done are usually in the fall market, which is where you see some, you know, sellers get a their house has been on since June, and they get a little desperate. They’re like, hey. You know, here’s $25 as a seller credit. We can use that for a buy down. But what I’m trying to tell people is so, like, last year at this time, rates were probably about an eighth of point higher than where we’re at right now, maybe a quarter point higher.
Pat: And then come September, if you guys remember, rates took a nosedive, and we got down under 6% for probably it was literally less than five business days. So some of those people, if they pick up the phone, if they weren’t on vacation, took advantage of that, we’re able to refinance, you know, almost a full percentage point lower than they probably locked in March or or April. Those two that missed the boat were now in tune to being like, alright. There’s some volatility going on out here. I just need to be prepared.
Pat: So what I did with a lot of my clients who bought at this time last year or even into the, you know, last fall or two falls ago, so eighteen months ago, was get those people prepped. Be like, hey. You know, this is what happens. We missed the boat this time because we weren’t ready. We didn’t have a file set up for you. But if you get your ducks in a row and you wanna kinda ride this out, we can get your file under and approve for refinance and get you essentially approved pending a rate lock. So when that volatility comes in your favor, we lock your rate and close you. So that kinda opened my eyes to how quickly this stuff you know, we end up refinancing in a few years.
Pat: Like, COVID times, it was just everything was refinancing. Everybody and their mother could refinance to under 3%. So those times, people weren’t reallyready for that because it’s been a couple years. So educating people on, again, what’s the what’s the strategy here? I just got locked in at 6.75%. Six months from now, if the market’s at 6% and you can do it, no closing cost refi, you’re gonna do it. That’s gonna save you a ton of money. It’s not gonna cost you anything.
Pat: So it’s just prepping those people, prepping everybody that this is the worst you’re gonna do when you buy a place right now in this market with a rate close to 7%. Even if rates go to 8%, great. You’re locked in. Right? If rates come back down to six or under, we’re gonna refinance you. So you gotta be comfortable with where you’re at.
Pat: And I think having that conversation upfront, establishing budgets for both cash out of pocket at closing for your down payment, you know, what’s comfortable with you having left over? Do you wanna have that emergency fund with, you know, $20.25 grand left in case somebody loses a job or something like that? Maybe we put a little bit less down and save that money because it’s not gonna impact your monthly payment. And then the other side of it is, you know, what is that comfortable level where, you you know, your monthly payment isn’t stressing you out?
Pat: Because if, you know, just because I can approve you up to 45%, 50% ratios and, you know, that’s a $7,000 mortgage, doesn’t mean you should be paying that or you feel comfortable paying that because I’m approving you on pretax dollars and you’re making a payment post tax dollars.
Pat: So what I tell people is I don’t want you cursing my name on the first of the month when you get that mortgage bill. Pat put me in this mortgage that the son of a god. So what I tell them is really, like, you’re the one making this payment. You gotta be comfortable with it.
Pat: So just because I can get you in this loan, when that bill comes due, are you gonna be comfortable making that $67,000 a month payment?
Saad: So I’m actually really glad you said that because that’s a common thing I talk to my clients about when I send send them off for, you know, to get a preapproval. I tell them, like, look, the lender doesn’t know your whole situation.
Pat: Yep.
Saad: Like, they like, you have to be comfortable with it. They’re gonna approve you for as much as they can, as much as they’re allowed to, but you know your situation better than anybody else, including myself. So you need to make that decision. So I’m really grateful to you for saying that. And that’s why if you’re out there listening, you need a lender like Pat who obviously is gonna be honest with you and, you know, gonna give you the real numbers, but also tell you, like, listen, this is what I can preapprove you for, but you gotta kinda, like
Pat: Doesn’t necessarily mean you should go buy a million dollar house.
Saad: Yeah. Exactly.
Pat: So Rocket Mortgage isn’t telling them that. They’re just giving you the max preapproval that you could possibly get.
Mike: yep. I have a question for you, Patty. You kinda let off by saying, like, you know, like, especially for arms. Like, there’s there’s a certain kind of, like, profile of of a buyer that can qualify or that it makes sense for.
Mike: I mean, we’re in Greater Boston. Property values are high. Like, you know, you’re you’re putting 10% down. Your payment’s gonna be super high. Like, what advice would you give to somebody who doesn’t have a high, like, you know, and doesn’t have the ability to put out put in, you know, 20%, doesn’t have, like, you know, parents who come from money, gift dollars, like, you know, I’ve seen some of that because frankly, over the last, let’s call it, over the last, like, year, most of the clients that I’ve had and I’m I hate to discourage folks, but, like, but, like, most of the clients I’ve had in obviously, we we operate in Greater Boston.
Mike: Like, most of the clients, they’ve had healthy down payments. Right? So what suggestion what advice would you give to those people who don’t?
Pat: Great question. So there’s a lot of creative ways we could do it. So those people that I talked about, they’re more probably gonna be geared towards a thirty year fix. So if you make a certain amount of money, the most of the areas around Boston, if you’re a first time buyer, the first time buyer income limit’s, like, a $170 for most areas. But that doesn’t mean if you make, like, 165 in a base salary and a $35,000 bonus, your all income is, you know, $200.
Pat: If I can qualify you and not use that bonus, I’m gonna get creative and just use your base salary. And I could sneak you into some of these first time buyer programs, get your rate a little bit lower, get your mortgage insurance lower in that situation. So my advice to those people is talk to someone, whether it’s me or anybody else who knows what they’re doing and get them set up before well before you start making offers so you can kinda understand the ins and the outs. Every like, I actually this is I have a client right now who’s in between buying in, like, the Attleboro area or into Rhode Island based off where they are.
Pat: And if once you go into Rhode Island, the limits drop tremendously lower. So he fits in the first time buyer program if he buys in the Attleboro area. But if he’s in Rhode Island, the limits are, like, down to, like, 85,000 for the area median income, which is what they go off of. It’s the census base for Fannie Mae.
Pat: So, you know, he’s like, why is my rate a half point higher if I’m buying in Rhode Island? And that’s why is because, you know, I can sneak him into this program. I’ve known you know, we know what those limits are. So my advice to your question is talk to a lender and know, you know, what areas you’re looking in because it’s gonna depend on what programs you qualify for.
Pat: So if you’re lower you know, less than 20% down, those first time buyer programs are huge because they really are, big time savers when it comes to rates and mortgage insurance. So it I’m talking mortgage insurance is is probably, you know, $50.60 bucks less a month, but that rate being almost a half point lower in some situations.
Pat: Like, those first time buyer programs basically don’t take your credit score into effect. They don’t take your debt ratios into effect as long as they’re under 50%. So if you as long as you have a credit score that meets whatever bank you’re working with threshold, like ours, we go down to 620 on the credit score.
Pat: And if, your debt ratios are pushing 50%, your mortgage insurance will be through the roof if you didn’t have one of these first time credit programs. But if you qualify for one of these programs, you can avoid doing an FHA loan. You can avoid, having super high mortgage insurance, and your rate’s gonna be just the same as somebody putting 20% down. So it’s it’s all about knowing your products, knowing your area and your clientele and what they’re looking for, and knowing what they can, you know, have access to.
Saad: So first, that home buyer programs are still a thing.
Pat: Yes. They are.
Mike: That’s right.
Pat: There’s a nation it’s all based off of the area you’re buying in. So, you know, around Boston, like Essex, Middlesex, Suffolk County, as, Norfolk County, they’re all like a it’s like a $170 roughly. But there’s a website Fannie Mae has a website where you can punch in the exact address and it tells you, hey. Here’s the the 100% area of median income you can use.
Mike: So I I think there’s a, large swath of of people that either maybe could buy right now or are thinking about it in the future. And you’re talking right now of, like, they wouldn’t know about this to plan accordingly. So what have you had people recently that maybe, like, okay. They just wanna they’re doing do their due diligence now for future planning, or maybe they don’t qualify for what they want right now and need to do in the future. Like, how do you handle those types of clients who are a little further out?
Pat: Great question. I actually tell people to, you know, the best time to start the process, even if you’re not gonna pull the trigger on buying a house until, you know, twelve, eighteen months from now, start it now because, you never know what’s on your credit report too. I had a client recently who, unfortunately, his mom passed away, and he was an authorized user on a credit card. So in this situation, you know, he didn’t know he had to pay he didn’t wasn’t obligated to pay the bills. He was just an authorized user.
Pat: There was, like, a $700 balance left, and it didn’t hit his credit report for twelve months later. So his score was lower. He didn’t know this until I pulled his credit for him to go put an offer in a house. Had to call the credit bureaus, get the situation squared away, and got it changed, but had it been a situation where it was like, you know, he had time on his hands. He didn’t get the house he was going on. We went back to work and, like, hey. Like, call Experian, call Equifax, be like, this is an error, and they gotta change and they gotta correct it.
Pat: But if he didn’t if he got that offer accepted, he would have closed with that lower credit score because it would take it takes about thirty days to get that corrected. Even if they’d say, hey. This is our mistake. It doesn’t really show until the next credit cycle. So my advice to people is get that stuff squared away. You know, even if you’re two years away from mine, have your credit pulled, have your situation gone over because you don’t know what you don’t know.
Pat: So you really need to be educated on what you can qualify for and what you should be doing, to get yourself in the best situation possible.
Saad: So Talk about the value of just having someone you can text or email if you have asked questions come up and as the environment changes and what have you. I mean, otherwise, you’re just googling or chat GPT ing or or as my wife would want me to say, Gemini and, like, you know, all this stuff.
Pat: You’re gonna get yourself you’re gonna get your brain filled. Take it going on, like, WebMD when you have, like, a cold. Like, oh my goodness. I’m sick. But, like, you know, like, there’s so much that goes into it. You go on, like, Zillow and you see what that cost. It’s not the same for everybody.
Mike: That added a lot of anxiety to my youth. That’s so good.
Pat: They play doctor on Google doesn’t help. So just playing the loan officer on Zillow doesn’t help you. So, you gotta get educated with someone who’s been doing it and, you know, whether it’s me or somebody else, it doesn’t matter. As long as you can kinda get the actual information, you wouldn’t know what those programs exist unless you talk to a loan officer.
Pat: You wouldn’t know, you know, that a six forty credit score and a six sixty credit score, there’s a huge difference because every 20 points on a credit scores is a big difference to to kinda help you get a better deal. So take that leap early is my advice.
Mike: Real quick. Shout out. Demeris, good to see you, buddy. Nick, Jacob, Salman. Yeah. And, appreciate those people tuning in. Saad, you got anything right now? Seem like you’re
Saad: I guess I guess the the the one thing just to piggyback off of what Pat just said, like, you know, starting early, it goes to one of the topics that you and I talked about, Mike, in a previous live is your team. Start building your team.
Pat: Right.
Mike: Right? I mean, I don’t lenders are key if you if you need financing, a lender’s gonna be a key person to have on your team. So someone you trust, build a relationship with them. Again, even if it’s twelve months, eighteen months, two years down the line, you want that person you can trust and, you know, pop a question over to and, you know, if you get a quick preapproval, they know all they know your situation. I mean, that’s invaluable rather than, you know, kind of running around with your head cut off with the times Yeah. When , like, you know, it’s it’s time. And it’s a competitive situation. And God knows, like, you know, in Greater Boston, it may always be that way.
Pat: Yeah.
Mike: So you need to be prepared. And so having the team ready is important.
Mike: I think you’re absolutely right.
Pat: Like, I I think you guys probably get in this business similar idea. Like, you like to help people. You like to be a resource. So the more you can be a resource to somebody, whether it takes them two weeks to find a house or two years to find a house, like, I’d give everybody my cell phone number. Everybody can call me, text me at any time. Right? Like, that’s just the way it should be. You have a question like, this job doesn’t stop at 05:00 because, you know, open houses are on Saturdays and Sundays most of the time.
Pat: If you have a question after the open house, send me a text. I’m your resource. Like, I want I want you to know what you need to do or or, like, I want your quest your questions answered quickly.
Mike: Yeah. Right? So I’m I’m sure that you guys operate the same way because it’s you gotta be a resource for people, because that’s what they remember. We rely on you too. Like, it’s not just the client. We’re the ones calling you and texting you too because we wanna make sure everything’s covered. It helps us prepare. Going on the, I said it ingest a bit on the, like, Rocket Mortgage or or whoever, like, advertising online, but you’re inevitably gonna see, like, advertised rates online that are, like, woah. This is, like, significantly lower than what I’ve been being told. And then somebody comes to you with that, and I warn them always, like, there’s there’s probably some hidden fees in the back end, like, kinda sitting around that are that are there, for that score. But, like, what has been your interaction of of people that inevitably you’ve had that recently?
Pat: Yes. So great question. What I would say is a lot of times, places like that, they bake in what’s called points, which are discount points to buy the rate down. Hey. You know, Rocket got me at that six and a quarter. Why are you at six and a half? Well, if you look at the fine print, Rocket’s charging you $12,000 extra. You’re bringing $12,000 more to closing to do that. The break even point is, like, nine years from now.
Pat: I would never recommend you do that based on the math. You’re literally just throwing away, lighting it on fire. If you could refinance at any point in the next nine years, you paid way too much money for those points. Right. So I generally don’t you know, if you’re paying an eighth of a point on a big loan to to get the rate down, maybe it makes sense. But paying, like, a point or two, like, what Rocket, like, kinda just makes their norm, doesn’t usually make sense.
Pat: Yeah. I don’t know if you guys have gotten in the mail. Like, sometimes you’ll get a just a a Rocket mortgage. Like, hey. You can refi at least during COVID, this happened all the time. You’d get, like, a your house is worth this, and you can refinance for the low cost of $27,000. I’m like, oh, great. I just get rock at $27 to get my rate down at half point. That sounds awesome.
Pat: So there’s the proofs in the pudding is what I tell people. You gotta just make sure you’re comparing apples to apples. I like to be upfront about everything. If I’m getting beat on costs, it is what it is. It’s you’re not gonna win every deal, and that’s just the way that things are.
Pat: Like, but I wanna make sure you know what you’re getting yourself into. If they’re beating me, I wanna tell you straight up. Transparency is is the best part of this business because that’s how you build trust with people. I think if you’re trying to sneak things in like that, you’re really you’re doing people a disservice and you’re you’re kinda, you know, making your name not not the greatest when it comes to reputation.
Mike: Yeah.
Saad: A bit of an aside here. I gotta ask
Mike: Oh, Saad, can I Mike, just quick follow-up on that particular point? Can you, Pat, just talk about, like, are you recommending, like, an actual buydown of points or, like, a two one buydown where it’s only for the next couple of years in anticipation of refinancing?
Pat: So permanent buydown of points is usually what the way Rocket kinda does it. Right? If we’re kinda staying on that line of conversation. That would be like, alright. So let’s say you have a $500,000 loan, your rate today on the market will be six and a half percent.
Pat: But if you pay two points, you could get it down to, like, 6.125%. That’s two points in in the yield. Right? Not to be a mortgage nerd here, but, essentially, it’s it’s you’re paying $10,000 off of 500,000. One point is 1% of the loan size, and you’re just buying the rate down by, you know, quarter point three.
Pat: It’s the point. So your difference in monthly payment is only gonna be about, you know, $75 a month.
Pat: So if you do the math on that, you’re paying $10 to save $75 a month. How long does that take you to make up that money? So that’s too long. That’s what yeah.
Pat: People just don’t like, I could do a heck of a lot more with $10 in my pocket right now over the next nine years or whatever it is. So but doing oh, sorry. The second part of your question. The buy down things, those are great.
Pat: Generally, like I said, you could do lender pay buy downs. Again, they’re good for a short term, but the way that they work for the lender is they’re jacking up your rate. That’s gonna be the ultimate rate at the end of the day. So if you do a three two one buy down, you’re let’s say you qualify for six and a half percent today, your rate would actually be 7% when the buy down ended.
Mike: Uh-huh. So you’re you have to do it in anticipation that you’re going to refinance probably within that time.
Saad: Did we lose Pat’s audio?
Mike: You hear me? Yep.
Saad: Yep. We got
Pat: We’re back. I got it. Instagram was trying to tell me to do I can do hand gestures or something. I had to click off that.
Mike: Yeah. It could be best.
Pat: I’m just happy I showed up on time without any technical difficulties. Hand gestures are for the next Instagram live.
Pat: So, yeah, if you get a seller to pay your buy down again, it’s like $20. The way that works is the the longer the buy down. So a three two one buy down, you’re buying that rate down for 3%. So you’re getting the base rate six and a half percent. That’s what you’d get if you just locked in. You do a three two one buy down. Your rate’s actually three and a half percent for year one, four and a half percent year two, five and a half percent year three, and then it goes in your at month 37, you’re at six and a half percent, which was the market rate when you locked in.
Pat: If you ever refinance before those three years are up, that money actually comes back to you. It’s basically that seller gives call it $20 or whatever it is. It’s a formula we gotta use, to to get the exact based off the loan size. But let’s say it’s basically just a subsidy that they’re paying down your monthly payment, right, for for your rate to be lower for twelve months in in increments. So let’s say you refinance after fifteen months and there’s, you know, $10,000 left in there, you get that money back.
Pat: You can apply it towards your principal at the time of the refinance. You can get that cash back. So that’s that’s your money. It’s just it’s used you know, instead of getting a seller credit, if your seller credit goes away because you can only have so much towards, you know, closing costs and everything. You can use that seller credit to to kind of benefit your rate situation.
Mike: Awesome. Sounds good.
Saad: The question I had was since we talked about Rocket a few times during this, this live, like, Rocket’s acquisition of Redfin. Like, is that does that like, are you seeing that, like, have an impact on your business at all? Because, I mean, so far, it has really impacted ours, but, like, at least mine. Mike, I don’t know about you, but, like No. Not really.
Saad: But, I mean, I I know it’s not officially closed yet, but, like, what are your thoughts on it? And does that, like, does it have an impact on anything, especially when it comes to your business?
Pat: I’m sure, will. I haven’t seen anything yet. You know, all those Redfin agents are probably gonna be I don’t know how their structure is gonna be for them to be referring to Rocket. So I’m sure they’re trying to keep everything in house there, instead of having, like, preferred lenders elsewhere.
Pat: But I’m sure it’ll have an impact, and I’m sure we’ll figure it out. But those things happen all the time. Yeah. It’s you kinda just it’s for right now, it’s just noise.
Mike: Yeah. And it’s not a problem, but, hopefully, it doesn’t become a problem.
Pat: Yeah. I can see where it definitely it can it’s gonna throw a wrench in some things.
Pat: Yeah. I mean, now they’re a massive company with financing behind the real estate side. So that’s it’s a big deal. But at the end of the day, if the client is savvy enough, they’re probably not gonna get the best rate from Rocket. Like, those big companies, there’s so much marketing that goes in that that’s basically those rates are higher because, you know, a place like a leader bankers we don’t do we don’t have we don’t sponsor a a PGA golf event.
Pat: You know what I mean? Like, there’s there’s there’s we’re not paying for that. So it’s our there’s not as much baked into our interest rates.
Saad: Never.
Mike: In my opinion, would you like to soft sponsor my softball team?
Pat: That’s a different conversation. Definitely. You gotta wear your hats and shirts.
Mike: Torii-branded Lamborghinis.
Saad: No. Too rich for my blood.
Saad: I was gonna ask you. So on this in the same vein in the in the last few seconds we have, do you encounter Zillow home loans at all in your in your, like, you know, competitive situations?
Pat: Yes. Not so much in a competitive situation, but a lot of people start with that because they they saw the place and they get they went through Zillow because that’s where they saw, hey. Look. I’ll get preapproved right now so I can make an offer on this house. Then they start working with a broker and the broker’s like, you need to talk to somebody local or, you know, somebody I know.
Pat: And at the end of the day, nine times out of 10, we’re we’re we’re beating them. But, yes, I do see people go come to me because they have a Zillow preapproval, but most of the time, it’s it’s their agent being like, you know, no offense, but you’re probably not gonna get your offer accepted with the Zillow preapproval. And that’s just this market. Right? Boston is so competitive that agents accept offers from places they know, and a lot of times, the bigger places like just they don’t close on time.
Pat: So they they they’re so big and they do so much volume that the reputation doesn’t matter because they’re gonna make up for
Saad: That’s how you’re really a good point. I’ve never submitted an offer with the Zillow home loans people or even a Rocket preapproval or anything like that. But I can and I guess in the back of my mind, I’ve thought about it. Like, when somebody does mention that, and I’m like, no.
Mike: Yeah. So around here, as you know, it’s probably frowned upon more than most of us. I even had, at one point, someone write on the, like, offer instructions that, if you have, like, a Bank of America preapproval that you need a secondary one to show as well. So it goes as far as basically, it’s any company that is just, like, faceless and, you know, there’s They
Pat: can’t call and vet you based off your preapproval. Exactly.
Saad: isting agents here hate bank.
Pat: Right. And that’s just it goes back to they don’t, most of the time, they don’t close on time because, again, they don’t it’s not like it’s just it they’re just so big. Right. Your phone call is going into an abyss. Well not to say anything bad about them. I mean, a lot of people use them, but it is. It is what it is. Yeah. You said it with me. I don’t talk bad about my competition.
Mike: We’re gonna edit that out, but, that’s perfect time to to send it to that to that today. Thank you. Alright. Thanks, Pat, for joining on this mortgage snapshot.
Pat: No problem.
Mike: You’re really smooth first time on Storii Time. We appreciate it, man.
Pat: Because all they can go downhill from here. So I appreciate you guys having me. Thank you very much. Appreciate it. Thank you.
Saad: That’s Pat. That’s, Mike. Storii time. Until next time.
Mike: See you.
Pat: Bye bye. Thanks, guys.
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