Latest / Connor with Honor: AI, Real Estate and Real Life / Santa Clarita loans and lending best practices and how to ensure you are not going to be taken advantage of

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Santa Clarita loans and lending best practices and how to ensure you are not going to be taken advantage of · Connor with Honor: AI, Real Estate and Real Life

• 0:00
  SPEAKER_00: Hey everybody, it's Connor McIver here with Connor with Honor Real Estate, headquartered in Santa Clara Valley.
• 0:05
  SPEAKER_00: We're going to do a quick market update.
• 0:07
  SPEAKER_00: We're here at November 9th, 2021, and we're going to be talking about Santa Clara proper, and we're also going to be talking about some of the issues that have been coming up lately within the real estate realm so you can be on your best guard.
• 0:20
  SPEAKER_00: Now, I'd say 97%.
• 0:22
  SPEAKER_00: I think that's the latest statistic of people that are looking to purchase real estate actually are going to need to secure some kind of financing.
• 0:29
  SPEAKER_00: So that's going to come in the way of a loan.
• 0:31
  SPEAKER_00: Usually those loans are handled by mortgage brokers.
• 0:35
  SPEAKER_00: They seem to get the lion's share of the business.
• 0:37
  SPEAKER_00: Now, other venues out there are going to be local banks, credit unions, and some of the online channels also offer financing.
• 0:45
  SPEAKER_00: Just have to be careful because when you're surfing around online and people are telling you they're going to give you the best interest rate possible and they're going to give you this beautiful song and dance about how successful they are getting people loans and how you're going to be happy.
• 0:59
  SPEAKER_00: What ends up happening in some of those cases is these are lead generation companies.
• 1:04
  SPEAKER_00: That's what they're built around.
• 1:05
  SPEAKER_00: So basically they're going to be selling you your personal and private information after you inquire because they give you this awesome teaser rate as the business calls it.
• 1:15
  SPEAKER_00: Basically, it's something that's not really available for really anybody, but it's something that they do put out there.
• 1:23
  SPEAKER_00: You have to be perfect in every way, shape, or form to be able to get that kind of a rate.
• 1:28
  SPEAKER_00: And there are so many, uh, so much small print that actually makes it almost impossible.
• 1:33
  SPEAKER_00: But it does get you interested.
• 1:35
  SPEAKER_00: It does get you to either pick up the phone or go online and enter your personal private information.
• 1:41
  SPEAKER_00: Then they're going to take that and they're going to sell it to maybe a dozen, maybe a few, but there's going to be lenders out there, they're going to be contacting you uh from now until forever.
• 1:53
  SPEAKER_00: So you have to be careful when you're doing that.
• 1:55
  SPEAKER_00: Just understand the source.
• 1:57
  SPEAKER_00: So I would just ask very simply.
• 1:59
  SPEAKER_00: There's a lot of different businesses that are operating this way.
• 2:03
  SPEAKER_00: You wouldn't realize it, but locksmiths are a big one.
• 2:06
  SPEAKER_00: Moving companies are huge.
• 2:08
  SPEAKER_00: Basically, they sell your personal and private information to the local market, and you're going to get companies that are going to respond to do these jobs for you and your you know your most prized possessions, right?
• 2:17
  SPEAKER_00: Moving and also coming to your house and changing locks, which is really important.
• 2:22
  SPEAKER_00: Might not be as big of a deal, but the moving really is.
• 2:25
  SPEAKER_00: So you're going to have this company show up and they're going to be very willing to help, probably get some kind of a pretty good deal.
• 2:31
  SPEAKER_00: But at the end of the day, when it comes down to it, I'll tell you how to best protect yourself.
• 2:35
  SPEAKER_00: They're going to do this walk-around and they're going to look at furniture.
• 2:39
  SPEAKER_00: And a lot of times they time it so it's super late at night when they finish.
• 2:44
  SPEAKER_00: So most of the people aren't really interested in doing the walk-around and probably accept things as they are.
• 2:49
  SPEAKER_00: We've been taken a couple times on that, uh, not three, but two, because we didn't do that walk around at night.
• 2:55
  SPEAKER_00: First one, years and years and years ago, I was young and didn't recall the trauma that I experienced.
• 3:01
  SPEAKER_00: It wasn't a lot broken.
• 3:03
  SPEAKER_00: But the second time wasn't that long ago.
• 3:05
  SPEAKER_00: And boy, I did uh there was a lot of mess.
• 3:08
  SPEAKER_00: I wish I would have pointed out at the time.
• 3:10
  SPEAKER_00: I don't know what they would have done.
• 3:12
  SPEAKER_00: Hopefully they would have made it right, but it's hard to say, but at least the record would have been made.
• 3:18
  SPEAKER_00: So these are those types of companies.
• 3:20
  SPEAKER_00: Just have to be careful who you're hiring to make sure that they are legit.
• 3:24
  SPEAKER_00: And that brings me back into the lending world because in real estate loans and lending, there are these different channels.
• 3:32
  SPEAKER_00: So you have mortgage brokers.
• 3:34
  SPEAKER_00: They're gonna, again, like I said before, they're gonna really have the lion's share of the business.
• 3:39
  SPEAKER_00: Mortgage brokers typically can draw on over a hundred different lines and sources of money.
• 3:46
  SPEAKER_00: So it might not come that your financing is coming through a mainline bank like Bank of America or Citibank.
• 3:54
  SPEAKER_00: Could be it's coming from ING or some other company out there that operates real estate lending funds.
• 4:00
  SPEAKER_00: So it could come from that, and also be aware that once you do secure that financing, depending on who you secure it with, that loan's probably gonna be sold to somebody that's willing to pay for it because they're gonna look at your credit profile, they're gonna look at the risk, and they're gonna look at the money that they can make from you over the term of 30 years, which is a typical mortgage length, and they're gonna buy it.
• 4:22
  SPEAKER_00: And so that lender's making money on that end as well.
• 4:25
  SPEAKER_00: The problem with some of these things is if there's mistakes made in the beginning regarding finances and paying impounds, which are gonna be things that maybe some people would pay separately, but in certain loans they're included in the payment, which could be homeowners' associations, which could be taxes, which could be insurance.
• 4:47
  SPEAKER_00: In some cases, they are part of your monthly payment, and the bank uses that to protect themselves because then uh they make sure they pay those taxes, they make sure they pay that house insurance.
• 5:00
  SPEAKER_00: And of course, you know, it's up to you what company you want to hire, as long as they don't have to force it.
• 5:05
  SPEAKER_00: So if you quit paying home insurance and you're not it's not impounded or included in your payment, let's say it's separate, so you do that every you know on your own, the bank's gonna check, and let's say a year and a month goes by, they don't get new coverage, and they might just knee-jerk into charging you instead of a thousand dollars a year, finding a company that charges five thousand dollars a year, and now your payment goes up substantially, and they really won't break that.
• 5:33
  SPEAKER_00: It will continue until the next year goes, and maybe you can get it back into good standing.
• 5:38
  SPEAKER_00: But be weary of that.
• 5:40
  SPEAKER_00: And if that does happen to you, you definitely want to step it up with your contact list, not just rely on the person that answers the phone when they tell you it can't be done.
• 5:50
  SPEAKER_00: You want to step up and talk to a manager or somebody else and make sure you're writing down all this information names, dates, times, who you speak with and what they what their ultimate outcome was and what they said to you.
• 6:01
  SPEAKER_00: That's incredibly important.
• 6:03
  SPEAKER_00: Now back to the lending world in real estate here in Santa Clarita Valley, the local lenders are usually very, very good.
• 6:09
  SPEAKER_00: You want to interview them just like anybody else.
• 6:12
  SPEAKER_00: If you're hiring a real estate agent, for example, Connor with Honor, I would hope you would want to sit down and speak with me and find out what I'm about, see if I'm a good fit or not, and then find out how I operate with my real estate company and what happens with my team.
• 6:27
  SPEAKER_00: And I'm the am I the sole contact?
• 6:29
  SPEAKER_00: Are you gonna be dealing with other people that are gonna be strangers to you?
• 6:32
  SPEAKER_00: Or, you know, I basically pride myself on being that one and only.
• 6:36
  SPEAKER_00: When it comes to lending, there's a lot of different components to lending.
• 6:40
  SPEAKER_00: It's hard to find that company where you're gonna have that one source of contact because they're gonna try to delegate responsibility as far as updates regarding your loan.
• 6:49
  SPEAKER_00: You know, find out how that works in the beginning.
• 6:51
  SPEAKER_00: How are you gonna be communicated with?
• 6:53
  SPEAKER_00: Is it gonna be something that you're gonna get this email that's gonna have exactly where they are and where the process is so you can kind of feel good about what's going on, or are they just gonna kind of set it and forget it and not say anything to you until the deal either falls apart or it finishes and funds?
• 7:12
  SPEAKER_00: Those are good questions to ask as well.
• 7:14
  SPEAKER_00: How are you gonna be dealing and updating me?
• 7:16
  SPEAKER_00: And who's going to be doing it?
• 7:18
  SPEAKER_00: Because sometimes, and this happens a lot, no matter really who you use, you'll get information on them needing a particular document.
• 7:28
  SPEAKER_00: So they'll say you need to go to your employer and get uh this particular document because we're gonna need it.
• 7:34
  SPEAKER_00: So when you do that, then a week later they say, Oh, we need this document.
• 7:40
  SPEAKER_00: And you can just say, Well, I've already given it to you.
• 7:43
  SPEAKER_00: A lot of times that works because now you have a different party requesting it.
• 7:46
  SPEAKER_00: Maybe they didn't see it in the file, maybe it wasn't uploaded, maybe it was put in a different name or not put in the correct area within the folder.
• 7:55
  SPEAKER_00: But in some cases, it's gonna seem redundant, but they're gonna need something that has a new date on it.
• 8:01
  SPEAKER_00: If they're asking you for, let's say, verification of employment, they do it at the beginning, but maybe a week before closing, the person that's lending you the money, the entity, has this part as their of their requirement, they want to see that in fact you uh still have employment and they want to see that new date.
• 8:21
  SPEAKER_00: They might they might also ask for paycheck stubs, new ones, so that's something else that could go on.
• 8:26
  SPEAKER_00: Don't get too frustrated in the process.
• 8:28
  SPEAKER_00: There are a lot of moving parts within real estate loans, and the lenders, if they write bad paper, they're held accountable.
• 8:36
  SPEAKER_00: So they want to make sure that everything that they're doing is legit.
• 8:40
  SPEAKER_00: You track back to the last debacle in the market back in 2006-2007.
• 8:46
  SPEAKER_00: That was a mess, and there were a lot of lenders that were writing really bad paper and they weren't doing their investigations.
• 8:52
  SPEAKER_00: And the loans and lending requirements were very loose.
• 8:56
  SPEAKER_00: People were selling real estate hand over fist, and everybody and their mother was able to get a loan.
• 9:01
  SPEAKER_00: And in some cases, uh, I've heard rumor that there was documentation made up to verify employment or income.
• 9:08
  SPEAKER_00: Well, there's so many checks and balances now because of that issue that happened back in the day and now.
• 9:15
  SPEAKER_00: All I'm saying is this at the end of the day, you want to purchase real estate, most of you are gonna need a loan.
• 9:22
  SPEAKER_00: You can do that with the local venues, local sources, you can do it with online.
• 9:27
  SPEAKER_00: Just make sure who you're speaking with is actual the actually the lender, and they're not an entity that's going to resell your personal and private information because that's gonna end you up in a tailspin of sorts where you're going to have so many people contacting you.
• 9:44
  SPEAKER_00: And that also includes real estate agents and a bunch of loans and lenders that are going to be purchasing your private and personal information so they can contact you and have you use them to get a loan.
• 10:03
  SPEAKER_00: Now, regular banks, credit unions, these are all good.
• 10:05
  SPEAKER_00: Most credit unions won't sell that paper, so you're gonna be with them for the length of the loan.
• 10:10
  SPEAKER_00: Sometimes credit unions are a little bit more nimble and give more allowance.
• 10:15
  SPEAKER_00: And by allowance I mean maybe your credit's not great, but you have a great trek record with them.
• 10:19
  SPEAKER_00: Maybe they can give you a better loan deal than mortgage brokers.
• 10:23
  SPEAKER_00: But don't bet on it.
• 10:24
  SPEAKER_00: You're gonna have to ask that question.
• 10:27
  SPEAKER_00: At the end of the day, contact me, Connor with Honor, Google me, you'll find me online, shoot me an email, give me a call, I'll walk you through the process, I'll give you questions to ask the lenders to make sure you're getting your best deal.
• 10:39
  SPEAKER_00: Whenever you're purchasing real estate, you're not paying my fee.
• 10:42
  SPEAKER_00: I get compensated by the seller, whoever that is, but part of your fee and purchasing real estate, if you need to obtain a loan, is gonna be that lender's fee.
• 10:52
  SPEAKER_00: That's something else you need to check and make sure you're not being gouged in any way, shape, or form.
• 10:56
  SPEAKER_00: And being gouged in lending could associate with the interest rate you're being charged.
• 11:02
  SPEAKER_00: Maybe it's higher than what would be normal, or points and fees that you're gonna be paying to secure that loan.
• 11:09
  SPEAKER_00: I'm Connor with Honor.
• 11:10
  SPEAKER_00: It was a pleasure updating you.
• 11:12
  SPEAKER_00: We are at, of course, Tuesday, November 9th, 2021.
• 11:15
  SPEAKER_00: We're getting ready to jump into Thanksgiving and, of course, Christmas after that.
• 11:19
  SPEAKER_00: I hope everybody is well and may you have a fantastic week in Jesus' name.
• 11:24
  SPEAKER_00: Have a great day.
• 11:25
  SPEAKER_00: We'll talk to you soon.
• 11:26
  SPEAKER_00: When you need me, I'm here.
• 11:27
  SPEAKER_00: Connor with Honor, over now.