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The TRUTH About Buying a House in Santa Clarita: Don't Make These Mistakes! · Connor with Honor: AI, Real Estate and Real Life

• 0:00
  SPEAKER_00: Connor with honor.
• 0:01
  SPEAKER_00: I hope everybody is doing fantastic today.
• 0:03
  SPEAKER_00: I do want to talk about that inventory that we always talk about in Santa Clare Valley and also give you some tips on how maybe you can get a lower interest rate with regard to your mortgage.
• 0:14
  SPEAKER_00: This is a new spin on the news cycle out there, so just be weary.
• 0:19
  SPEAKER_00: It isn't a very simple thing, and in essence, it's something that a lot of people probably aren't going to want to do to try to get a lower interest rate, but I'll cover those here in just a moment.
• 0:28
  SPEAKER_00: But let's talk about the local market and inventory.
• 0:31
  SPEAKER_00: So today's Tuesday, of course, within the real estate world in Santa Clarita Valley.
• 0:36
  SPEAKER_00: We are still seeing some movement.
• 0:37
  SPEAKER_00: We did have some new listings added from yesterday to today.
• 0:41
  SPEAKER_00: So currently we're sitting at 288 active listings for sale throughout all of the Santa Crita Valley cities.
• 0:48
  SPEAKER_00: So of those, we have of the coming soon Variety 14.
• 0:52
  SPEAKER_00: These uh coming soon people have often asked me where can they see those listings?
• 0:58
  SPEAKER_00: Unfortunately, well, whatever.
• 1:00
  SPEAKER_00: Whether it's fortunate or unfortunate, the best way to get those is to have an agent have you on their email list and sending you the properties that meet your criteria.
• 1:09
  SPEAKER_00: So if anything has to happens to be coming soon, you'll be notified of it, and then thereby you'll be able to see it prior to it actually hitting the active market for sale.
• 1:18
  SPEAKER_00: There are ways to be able to get access to those properties.
• 1:22
  SPEAKER_00: Most of the agents I speak with that I have relations with in some way, shape, or form from past experiences and working together in the real estate industry, typically I can get access.
• 1:34
  SPEAKER_00: It's just going to depend on the seller's intention for the coming soon.
• 1:38
  SPEAKER_00: Sometimes the coming soon is for advertising and marketing for agents, so the properties can be seen.
• 1:43
  SPEAKER_00: However, it's just going to really depend on where the seller's mindset is and the actual strategy the agent's using.
• 1:50
  SPEAKER_00: And if in fact I can even get anybody inside early.
• 1:53
  SPEAKER_00: Don't fret, however, because getting inside a coming soon listing doesn't mean you're going to get that listing.
• 2:00
  SPEAKER_00: If you love it to death, want to write the best offer in the world and submit it to the seller.
• 2:04
  SPEAKER_00: It doesn't always mean that the seller wants to cut out all the other competition and just accept your offer.
• 2:11
  SPEAKER_00: And in fact, probably that would be not very often the case where the seller would entertain that first offer in.
• 2:17
  SPEAKER_00: So don't panic.
• 2:18
  SPEAKER_00: That should be not so much of a point to be able to upset someone, but actually make you feel better about it.
• 2:24
  SPEAKER_00: Say, okay, I'm not going to miss anything by maybe delaying and waiting for the property actually hit the active market for sale.
• 2:30
  SPEAKER_00: Maybe that first open house, whatever it is, but then you can go see it in person.
• 2:34
  SPEAKER_00: And typically sellers aren't super quick to jump on that first offer in.
• 2:39
  SPEAKER_00: Usually sellers are going to sit back just a little bit and give it a little bit of time to see if other offers happen to be submitted for the real estate listing that they're trying to sell.
• 2:49
  SPEAKER_00: And of course, sellers have their methods too.
• 2:51
  SPEAKER_00: Some of them are contingent on finding something else, which then puts the buyer in kind of a cold spot.
• 2:57
  SPEAKER_00: What if they tie up with this property and something else becomes available that they like a lot?
• 3:02
  SPEAKER_00: Well, there are things in play that allow that buyer to actually cancel that first transaction and then potentially get into another transaction on a house that they might like that doesn't have the same encumbrances that the seller's house does.
• 3:18
  SPEAKER_00: I need to find a property and close both at the same time.
• 3:22
  SPEAKER_00: And maybe they haven't found that property yet.
• 3:24
  SPEAKER_00: Maybe they're looking to move out of state and making this sale on contingent on purchasing another one.
• 3:30
  SPEAKER_00: Well, as a real estate buyer, that could be all well and good, but what if it takes the seller months and months and months to be able to identify this home of choice?
• 3:42
  SPEAKER_00: Unfortunately, a buyer can't really wait that long, and in some cases, won't wait that long, even if they can.
• 3:50
  SPEAKER_00: The sellers need to understand and try to absorb the market a little bit from a standpoint that if there are other properties that come on the market, that buyer's not held to their house.
• 4:01
  SPEAKER_00: That buyer can then move on unless the buyer accepts those types of terms that says they have to buy this house.
• 4:08
  SPEAKER_00: And if they don't buy the seller's house whenever the seller finds their home of choice, then that buyer is going to lose the deposit that they put into the escrow process.
• 4:18
  SPEAKER_00: That would be an incredibly dangerous place for a home buyer to be, and definitely would be against my suggestion to a client of mine.
• 4:27
  SPEAKER_00: Well, of course, I'm Connor with Honor.
• 4:29
  SPEAKER_00: All right, let's jump into uh what's happening here.
• 4:32
  SPEAKER_00: So we do talk about mortgages.
• 4:34
  SPEAKER_00: I'm not a real estate lender, but I do have access to those folks and I do deal with them quite a bit because, well, we sell houses to buyers, buyers need financing, buyers need a lender, so thereby me getting involved with the lenders.
• 4:46
  SPEAKER_00: Adjustable rate mortgages.
• 4:48
  SPEAKER_00: Do you like them?
• 4:49
  SPEAKER_00: Probably not.
• 4:50
  SPEAKER_00: A lot of people don't.
• 4:51
  SPEAKER_00: A lot of people think that there's a big problem with them, but the language is pretty specific and pretty clear when it comes to what adjustable rate mortgages are.
• 5:01
  SPEAKER_00: So they're dependent on a couple different indexes out there.
• 5:05
  SPEAKER_00: Meaning when you do get a rate that is adjustable, at some point it becomes adjustable.
• 5:12
  SPEAKER_00: Usually three to five years is the term where the rate stays where it is.
• 5:16
  SPEAKER_00: And that's typically lower than what the market rate is at that current time when you got the uh adjustable rate mortgage, right?
• 5:24
  SPEAKER_00: So you're sitting at a lower than what everybody else is paying interest rate, but your pain point comes in when that interest rate adjusts.
• 5:32
  SPEAKER_00: And usually the adjustment is not in your favor, usually it's higher.
• 5:38
  SPEAKER_00: So once that interest rate's adjust, that interest rate adjusts, now your mortgage payment is more.
• 5:43
  SPEAKER_00: And then it could adjust again, then it can adjust again.
• 5:46
  SPEAKER_00: And it depends on the time frames built in as to when those future adjustments are.
• 5:51
  SPEAKER_00: It also depends on how robust or not robust the market is in real estate, depending on how far that jump in that interest rate is going to be.
• 5:59
  SPEAKER_00: Adjustable rate mortgages are good for who?
• 6:02
  SPEAKER_00: Well, if you're not going to be in the house more than three or five years, you're probably good.
• 6:07
  SPEAKER_00: But I don't know a lot of people that are in that world.
• 6:09
  SPEAKER_00: But if you are, then maybe adjustable rate mortgage is your flavor.
• 6:13
  SPEAKER_00: Just understand that once you get into it, to get out of it, you got to refinance.
• 6:18
  SPEAKER_00: So hopefully you have enough equity at some point in the future if you decide that, hey, you know what, I had this great three-year plan that I was going to jump ship and get out of the world.
• 6:26
  SPEAKER_00: But now it looks like I'm going to be sticking around another 30, 40 years.
• 6:29
  SPEAKER_00: So why don't I go ahead and refinance this into something that has a 30-year fixed product or another way to save money on your mortgage?
• 6:38
  SPEAKER_00: Why not get a 15-year?
• 6:39
  SPEAKER_00: Of course, yeah, your payments are going to be quite a bit higher, but you're not an adjustable rate at that point.
• 6:44
  SPEAKER_00: Your interest rate's probably going to be lower, but also you're going to be paying off your home in a lot less time than you would with a 30-year mortgage.
• 6:52
  SPEAKER_00: But with a 30-year mortgage, you can also make an extra payment a year, and I believe that cuts your house payments down to about 21 years, an extra payment a year, which isn't bad.
• 7:01
  SPEAKER_00: So something that can say extra payment, is it a year?
• 7:04
  SPEAKER_00: We'll do the math on that, I'll get back to you.
• 7:06
  SPEAKER_00: But there are ways to reduce the time frame on a 30-year mortgage, and I will give you that as well here in the future, so you can kind of, but that's another way.
• 7:16
  SPEAKER_00: You say you have the shorter term, you have the adjustable rate mortgages.
• 7:20
  SPEAKER_00: Of course, you can also spend money to buy your mortgage rate down.
• 7:24
  SPEAKER_00: So when you're in escrow, there are certain fees that you can pay to your lender that will actually reduce that interest rate that they have talked to you about.
• 7:32
  SPEAKER_00: However, it's not always a lot.
• 7:35
  SPEAKER_00: And maybe the money is a lot, but the interest rate reduction isn't a lot.
• 7:39
  SPEAKER_00: But look at the numbers and see if they make sense.
• 7:41
  SPEAKER_00: And then also ask the question: how long is it going to take me to recoup from this extra money I'm spending now to lower that interest rate?
• 7:49
  SPEAKER_00: What does that, how does that structure out over the next few years?
• 7:53
  SPEAKER_00: And it might take two or three years for you to recover whatever the money's it cost you to have that mortgage rate reduced.
• 8:00
  SPEAKER_00: At least you numbers and you can play them out with your scenario and say, hey, you know what, this might be a good deal.
• 8:05
  SPEAKER_00: We have that lower payment.
• 8:06
  SPEAKER_00: It'll take us two years to recoup, but we're not going anywhere.
• 8:09
  SPEAKER_00: And in fact, we listen to Connor.
• 8:11
  SPEAKER_00: So this house is going to be our holding pattern home.
• 8:14
  SPEAKER_00: And this is the one we're not going to leverage.
• 8:16
  SPEAKER_00: We're going to try to hold on to for the rest of our lives.
• 8:18
  SPEAKER_00: This will be that rental that we'll be able to fall back on in our golden years or silver years or whatever, but be able to fall back on and say, hey, this is that house that Connor said we should buy, not sell, and hold on to.
• 8:30
  SPEAKER_00: And look, thank God we did because we have this amount of equity.
• 8:33
  SPEAKER_00: We were able to use it a couple different times and maybe buy other properties, so on and so forth.
• 8:38
  SPEAKER_00: There are ways to do it.
• 8:39
  SPEAKER_00: So as far as the mortgage rate goes, if you have a good FICO score, you have a good solid credit profile, you should be getting the best rate that the lenders offer.
• 8:49
  SPEAKER_00: And of course, they're going to look at things like debt-to-income ratio and your credit history.
• 8:53
  SPEAKER_00: But when they do and you qualify, again, it's really not that top, that tier one, tier two, tier three crap that we see in the automotive industry.
• 9:02
  SPEAKER_00: Real estate's a little bit different.
• 9:04
  SPEAKER_00: It's taking you 30 years to pay something off.
• 9:06
  SPEAKER_00: Not in the auto industry, like a few.
• 9:08
  SPEAKER_00: This is a long time, folks.
• 9:09
  SPEAKER_00: And there's a lot of interest to be made by the banks.
• 9:12
  SPEAKER_00: So I think they're a little bit more easier.
• 9:14
  SPEAKER_00: But again, unless you get that second opinion, you might not know.
• 9:19
  SPEAKER_00: And that's maybe good advice.
• 9:20
  SPEAKER_00: I hope everybody enjoyed today's Tuesday broadcast.
• 9:23
  SPEAKER_00: Tomorrow we're going to talk about foreclosures, bank-owned, and real estate-owned properties.
• 9:27
  SPEAKER_00: We'll get that show out there tomorrow and get that developed for you.
• 9:31
  SPEAKER_00: I'm Connor with Hon.
• 9:32
  SPEAKER_00: If you have any questions, let me know.
• 9:33
  SPEAKER_00: If you're looking for real estate or know somebody that is, send them my way.
• 9:37
  SPEAKER_00: I'll have them sit down.
• 9:38
  SPEAKER_00: We'll do our real estate roll call.
• 9:40
  SPEAKER_00: I'll sit down and talk with them about how the market works, the adjustments they should be making today to prepare for purchasing in the future.
• 9:46
  SPEAKER_00: And if you're thinking about selling something, well, that might be something we should have a discussion about.
• 9:51
  SPEAKER_00: So you can find out if in fact it's the best time.
• 9:55
  SPEAKER_00: I hope everybody's well.
• 9:56
  SPEAKER_00: Talk to you soon.
• 9:57
  SPEAKER_00: I am Connor with Honor and over now.