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#78 Mortgage Rates 2026: Why Waiting Is Costing You Money · Own More Doors

• 0:00
  SPEAKER_00: So people have been waiting for interest rates to drop this entire time.
• 0:03
  SPEAKER_00: All of last year in 2025, in this entire quarter, they're waiting.
• 0:06
  SPEAKER_00: But guess what?
• 0:07
  SPEAKER_00: Interest rates have gotten a little better, but not super low.
• 0:10
  SPEAKER_00: But one thing we've seen, buyers are off the fence.
• 0:13
  SPEAKER_00: They're buying, transactions are happening, even though interest rates did not drop like we expected them to.
• 0:19
  SPEAKER_00: Hi, I'm Juan Weezar with Sage Real Estate, and I'm here with Phoebe Tutoroff with Sage Trust Mortgage.
• 0:24
  SPEAKER_00: And we're going to be talking about mortgages today.
• 0:26
  SPEAKER_00: Phoebe, tell us what's going on.
• 0:27
  SPEAKER_00: We just got through the first quarter of 2026.
• 0:30
  SPEAKER_00: What's happening?
• 0:31
  SPEAKER_00: Uh, perception, interest rates, what are the feds doing?
• 0:34
  SPEAKER_00: Let's cover it all.
• 0:35
  SPEAKER_01: Mortgage applications have definitely increased.
• 0:37
  SPEAKER_01: More people are, you know, coming off the bench.
• 0:40
  SPEAKER_01: Um, they're realizing that mortgage interest rates are not going to be pandemic rates.
• 0:46
  SPEAKER_01: They're not going to get there.
• 0:47
  SPEAKER_01: They're not going to, you know, exponentially drop at any given time.
• 0:52
  SPEAKER_01: Um, the feds have cut the rates, right?
• 0:54
  SPEAKER_01: But that doesn't always correlate to um the short-term mortgage rates.
• 0:58
  SPEAKER_01: So um more people are just realizing that they're missing out on that next property because they're waiting for the interest rate to drop.
• 1:07
  SPEAKER_01: And we try to educate our clients that if the interest rates do drop, then you're going to have the opportunity to refinance, right?
• 1:15
  SPEAKER_01: And take advantage of that lower interest rate.
• 1:17
  SPEAKER_01: If you keep waiting for that to happen before you purchase your property, now you're opening up the door for more buyers who didn't qualify for the same loan that you qualified for because the interest rate is lower now.
• 1:30
  SPEAKER_01: So there's more competition, there's more buyers.
• 1:34
  SPEAKER_01: Um, and what that's going to do when interest rates do drop is it's going to take us back to bidding wars and, you know, people overpaying for properties and um willing to do anything to get it, right?
• 1:50
  SPEAKER_01: Because there's a lot more people that qualify for those same properties because the interest rates are lower, because maybe their income isn't as high as yours is, or their credit isn't as good as yours is.
• 2:01
  SPEAKER_01: So my advice to all of our clients now if you can afford it, it's it's in your game plan and it's in your, you know, your wheelhouse for what you want to do, buy that property, right?
• 2:14
  SPEAKER_01: And when the rates come down, then you can refinance and take advantage of that lower rate.
• 2:18
  SPEAKER_01: And you've purchased the property at a price that when the rates do come down, maybe even higher.
• 2:24
  SPEAKER_01: So you've already gained, you know, extra appreciation in the property that you currently own already when you do refinance.
• 2:31
  SPEAKER_00: And that's what I see being the biggest issue, Phoebe, when you say people wait.
• 2:35
  SPEAKER_00: So let's just say 24 months ago, people are like, ah, interest rates are too high.
• 2:38
  SPEAKER_00: I'm gonna wait.
• 2:39
  SPEAKER_00: I promise you, if there was a property you were looking at, I promise you that it's most likely worth more now.
• 2:44
  SPEAKER_00: Already.
• 2:45
  SPEAKER_00: Of course.
• 2:45
  SPEAKER_00: So you've already shot yourself in the foot by waiting.
• 2:50
  SPEAKER_00: Yes.
• 2:50
  SPEAKER_00: So you didn't win.
• 2:51
  SPEAKER_00: No.
• 2:52
  SPEAKER_00: You didn't win.
• 2:53
  SPEAKER_00: You're actually worse off than that you should have purchased because you would have had some equity.
• 2:57
  SPEAKER_00: But let's just say that's the case.
• 3:01
  SPEAKER_00: What's and I know you just covered uh the best advice right now is is hey, if you like something, if you could afford it, act on it, and then worry about refinancing later, whenever that might be.
• 3:12
  SPEAKER_00: Right.
• 3:13
  SPEAKER_00: Right.
• 3:13
  SPEAKER_00: Um how are we looking in terms of um when interest rates should I mean, I was telling people, hey, look, first quarter of 2026, interest I think, I think, and I don't know, you know, I don't know at all, I think they're gonna be lower.
• 3:27
  SPEAKER_00: And they really haven't been.
• 3:28
  SPEAKER_00: And there's been a little bit a couple weeks where it goes a little down, and people start going crazy, and then they go a little back up, and it's just constantly shifting.
• 3:35
  SPEAKER_00: Correct.
• 3:36
  SPEAKER_00: Yes.
• 3:36
  SPEAKER_00: What's your opinion?
• 3:37
  SPEAKER_00: I and I know everyone's gonna say, Oh, look, I don't have a crystal ball.
• 3:40
  SPEAKER_00: I get it, but what's your opinion in terms of when are they gonna come down?
• 3:44
  SPEAKER_01: It's so tough.
• 3:46
  SPEAKER_01: I really don't have an opinion because there's so many factors that play into um interest rates.
• 3:52
  SPEAKER_01: And it, you know, a lot of it is, you know, what goes on in the world, right?
• 3:57
  SPEAKER_01: Um what goes on with the economy and inflation.
• 4:01
  SPEAKER_01: And um I honestly do not think that interest rates are going to improve significantly this year from where they're at now.
• 4:11
  SPEAKER_01: Um, that's my honest opinion.
• 4:12
  SPEAKER_01: I think we're gonna stay pretty steady throughout the rest of the year.
• 4:16
  SPEAKER_01: And um, you know, that's that's just kind of what I see and what I feel is gonna happen.
• 4:22
  SPEAKER_00: So given they're they're gonna stay steady and and someone's in a situation where they could afford to buy, they do qualify, there's no point in waiting.
• 4:29
  SPEAKER_01: No, there's no point in the way.
• 4:30
  SPEAKER_00: Because what's what what's gonna happen, and here's in certain areas, and I listen, if you listen to parts outside of California, I I can't speak to those markets, but in Southern California, I could assure you that whether you buy now or December, December might be worth a little more.
• 4:44
  SPEAKER_00: The property will be worth more.
• 4:45
  SPEAKER_00: It just there's a there's there's natural increase, uh just the cost the cost keeps going up.
• 4:51
  SPEAKER_00: Yes, and so a couple other things.
• 4:55
  SPEAKER_00: Um if you if you are someone right now who's who's who's thinking about buying and they're wondering and we could first talk about single family homes.
• 5:09
  SPEAKER_00: What are the what are interest rates right now?
• 5:11
  SPEAKER_01: Depending on property type, credit score, and your down payment, your interest rate could be um mid to high fives.
• 5:19
  SPEAKER_01: Um it in most instances on single family and condos.
• 5:22
  SPEAKER_01: That's that's what I'm seeing right now.
• 5:24
  SPEAKER_00: Okay, which is good.
• 5:24
  SPEAKER_01: Correct, correct.
• 5:26
  SPEAKER_01: It is it is better.
• 5:27
  SPEAKER_01: It's it's I would say closer to the higher fives than the mid-fives.
• 5:31
  SPEAKER_01: Um there's always the option to you know pay a point to get to a mid-five if you're interested in that.
• 5:37
  SPEAKER_01: But um they've definitely improved, right?
• 5:42
  SPEAKER_01: Um, I have clients that purchased 24 months ago when they decided that they needed it, and they've already done a refinance, and they've already um I actually just closed one, they put 5% down um in 2025 January.
• 5:58
  SPEAKER_01: So they're about 15, 16 months into the property.
• 6:00
  SPEAKER_01: They put 5% down.
• 6:01
  SPEAKER_01: Well, they've already gained an additional 5% in appreciation.
• 6:05
  SPEAKER_01: So their mortgage insurance was reduced, their interest rate was reduced, and they saved$388 a month.
• 6:12
  SPEAKER_00: On the refinance.
• 6:13
  SPEAKER_01: On the refinance, and the refinance cost them zero dollars.
• 6:16
  SPEAKER_00: Because they were able to go through a special program with you.
• 6:19
  SPEAKER_01: Well, yeah, special.
• 6:20
  SPEAKER_01: They had they had different options.
• 6:21
  SPEAKER_01: They had the option to pay fees, they had the option to pay no fees, um, and they went with the no fee option, and they're saving$388 a month.
• 6:29
  SPEAKER_00: Yeah.
• 6:30
  SPEAKER_00: You bring up a good point.
• 6:31
  SPEAKER_00: You know, sometimes people say, well, you know, the interest rates were too high.
• 6:34
  SPEAKER_00: And you kind of just gave us a kind of a a rough where they might be.
• 6:38
  SPEAKER_00: You talked about you could buy it down, and you kind of quickly went through it.
• 6:42
  SPEAKER_00: Why don't you explain to someone who like how can they buy it down, more or less what's the cost, and can we get someone else to pay for it other than us?
• 6:51
  SPEAKER_01: Oh, always, yes.
• 6:52
  SPEAKER_01: Um so buying down the interest rate is is what is known as paying a point or paying points.
• 6:58
  SPEAKER_01: Um, points are also called origination, they're called discount points, but it kind of all means the same thing.
• 7:04
  SPEAKER_01: So if you're paying origination and or points, um typically you're going to get a better interest rate.
• 7:13
  SPEAKER_01: Um there isn't really a rule of thumb.
• 7:17
  SPEAKER_01: If you're going to pay a point, which is 1%, one point is equivalent of 1%.
• 7:23
  SPEAKER_01: Um, and it's going to be 1% of the loan amount that you borrow.
• 7:27
  SPEAKER_01: Um, typically your interest rate will be improved by a quarter, possibly 0.375% better, three eighths better in most instances.
• 7:36
  SPEAKER_01: So, you know, you can make that decision, you can figure out what the cost to recoup that point is with the savings on your payment.
• 7:44
  SPEAKER_01: And I could run all of those numbers for you.
• 7:47
  SPEAKER_01: Um if you're purchasing a property um and there's always the opportunity to request the seller to pay part of your closing costs.
• 7:57
  SPEAKER_01: And that closing cost credit can be used to assist with any funds that you decide to use it for to buy down your interest rate or pay points, right?
• 8:08
  SPEAKER_01: So um definitely a great way to go.
• 8:11
  SPEAKER_00: Awesome.
• 8:11
  SPEAKER_00: Uh, Phoebe, for for for the investors listening today, and let's just say someone's looking at a four-unit building and they're not gonna live in it, so it's an investment it's an investment purchase.
• 8:22
  SPEAKER_00: What what's the interest rate right now?
• 8:24
  SPEAKER_00: I know it could change and no one's gonna hold you to anything, but what are they what could they expect if they were to buy today?
• 8:29
  SPEAKER_01: The last one that we closed, so like full documentation, doing an agency loan, 25% down, um, really good credit score, you know, like 760 and above.
• 8:40
  SPEAKER_01: Um, you're probably looking in the low to mid sixes.
• 8:45
  SPEAKER_00: Okay.
• 8:45
  SPEAKER_00: So almost like another point from a single family home in a way.
• 8:48
  SPEAKER_01: Correct.
• 8:49
  SPEAKER_01: Okay.
• 8:49
  SPEAKER_01: Yeah.
• 8:50
  SPEAKER_00: Yeah.
• 8:50
  SPEAKER_01: Half to three quarters.
• 8:51
  SPEAKER_01: Yeah.
• 8:51
  SPEAKER_01: Yeah.
• 8:52
  SPEAKER_00: Okay.
• 8:53
  SPEAKER_00: Okay.
• 8:53
  SPEAKER_00: So that gives you guys a good idea.
• 8:55
  SPEAKER_00: I'm going to be calling this segment the mortgage minutes, and we're going to keep coming and bringing more information to you guys.
• 9:01
  SPEAKER_00: If you have any questions on, hey, can you please cover this or this type of loan?
• 9:06
  SPEAKER_00: Please let us know.
• 9:07
  SPEAKER_00: We're going to try to keep some of these podcasts a little short and sweet.
• 9:10
  SPEAKER_00: So I hope you guys enjoyed today.
• 9:11
  SPEAKER_00: Phoebe, I'm going to give you the last word.
• 9:13
  SPEAKER_00: Is there anything you want to tell us?
• 9:15
  SPEAKER_01: Um, if you're ready and you can afford it and you need a tax write off, get off the bench and and purchase that property.
• 9:24
  SPEAKER_01: Get in there.
• 9:25
  SPEAKER_01: Get it at the price you want it.
• 9:27
  SPEAKER_01: Um, and you know, when rates do come down, you can refinance.
• 9:31
  SPEAKER_00: Thank you so much, folks.
• 9:32
  SPEAKER_00: Make sure to like, comment, and subscribe.
• 9:34
  SPEAKER_00: Thank you so much.
• 9:35
  SPEAKER_00: Until next time.