"The Mortgage Reality Check: What Buyers Think vs What Actually Happens"

The Mortgage Reality Check: What Buyers Think vs What Actually Happens | Real Estate UnRaked Podcast Ep. 30

In this milestone Episode 30 of the Real Estate UnRaked Podcast, Eric Rakers is joined by Dane Coussens, Bridget Hodges, and Jaycee—along with a very special guest… our FIRST official guest on the show, Brian Wilhelm with Bayway Mortgage Group.

This episode pulls back the curtain on one of the biggest disconnects in real estate today:

👉 What buyers THINK they qualify for… vs what actually happens when they talk to a lender.

If you’re a homebuyer in Northeast Florida, thinking about buying a home in Jacksonville, Fleming Island, Green Cove Springs, or surrounding areas, or just trying to understand how mortgages really work in today’s market—this episode is a must-listen.

💥 What This Episode Breaks Down

From the very first minute, we dive straight into the reality of today’s housing market and mortgage process—no fluff, no sugarcoating.

With insights from Brian Wilhelm of Bayway Mortgage, we cover:

🧠 What Buyers THINK vs Reality

• The biggest misconceptions buyers have when they think they’re ready to buy
• Why what you think you qualify for can be completely different from reality
• The “nobody told me that” moments that catch buyers off guard
• Behind-the-scenes lender insights most agents never explain

💰 Affordability Reality Check

• What actually determines how much home you can afford
• How income, debt, credit score, and monthly obligations impact your buying power
• Why your “comfortable payment” might not match lender calculations
• How things like car payments, credit cards, and student loans can drastically reduce your purchasing power

💡 Truth bomb:
 That $800 truck payment? It could cost you over $150,000 in buying power.

🚫 Loan Killers: What NOT to Do

This is where it gets real…

Brian breaks down the most common (and costly) mistakes buyers make during the mortgage process:

• Opening new credit cards
• Financing furniture before closing
• Buying a car mid-transaction
• Changing jobs
• Making large unexplained deposits

Plus, we share real-world scenarios where buyers almost lost their loan approval right before closing.

📊 Northeast Florida Market & Mortgage Trends

We take a hyper-local look at what’s happening right now in Northeast Florida real estate, including:

• Buyer demand across Jacksonville, Clay County, and St. Johns County
• Affordability challenges and opportunities
• The truth about buyers “waiting” for interest rates to drop
• Loan programs many buyers don’t even know exist

💡 Including:

• FHA Loans
• VA Loans
• First-Time Buyer Programs
• Down Payment Assistance Options

🎯 The Biggest Takeaway

Buying a home isn’t just about finding the perfect property…

It’s about understanding the numbers behind the dream.

And in today’s market, having the right team—a knowledgeable lender + experienced real estate professionals like The Rakers Home Group—can make the difference between missing out and winning.

I do not own the rights to the music or the sound effects used in this podcast

Transcript

SPEAKER_00 0:00

Let me ask you something. If you walked into a lender's office today and said that you wanted to buy a house, would the lender actually agree with you? Because what buyers think they may qualify for and what the lender says they qualify qualify for are sometimes two completely different numbers. So today we're pulling back the curtain on the mortgage world, and then we actually have our first guest ever on the show, and we're talking about what lenders actually see behind the scenes.

SPEAKER_05 0:26

The surprises, the mistakes, and the things buyers do that make lenders want to slam their laptop shut. So I'm excited for this one because buyers have a lot of questions about this stuff.

SPEAKER_00 0:36

Because let's be honest, you can fall in love with a house, but if the numbers don't work, that love story ends real fast. So grab your coffee or something stronger and let's unrank it.

SPEAKER_02 0:46

Let's do it.

SPEAKER_00 0:55

All right. Well, guys, welcome to Big 3-0 episode of Real Estate Unranked, and we have our very first special guest on the show, Brian Wilhelm with Bayway Mortgage Group.

SPEAKER_02 1:05

Hi guys. Hi, Brian. Thank you so much for having me.

SPEAKER_00 1:08

It's an absolute pleasure to have you here with us today. So tell us a little bit about you and kind of give a little bit of background so everybody knows.

SPEAKER_02 1:14

So high level, I've got almost 30 years' experience in the real estate business. I owned and ran a real estate company in Charlotte, North Carolina for a number number of years. I've been a lender since 2008. I've had my hand in real estate in some way, shape, or form since I was 18 years old. So there's there's nothing I haven't seen. And I I take my experience, I feel like everything that I've learned up to this date allows me to help buyers have confidence and clarity when they are purchasing their home.

SPEAKER_00 1:51

That's awesome. I I love your story. Uh, we've met with you uh several different times, and you're you're actually helping the team out with some stuff, which is we're really excited about. But I love your energy, I love your history that you had you that you talk about. It's really exciting, especially for us too as well. I think you're a true professional in the business, and I feel honored to work with alongside with you stuff. Same here.

SPEAKER_02 2:15

Oh guys, I appreciate that to be called a professional, especially in our industry.

SPEAKER_00 2:20

Brian, you you got it, buddy. Well, let's jump right into what buyers think and what as act versus what actually has happened. So, Brian, I'm gonna jump in right into this. And what is the biggest misconception buyers have when they come to you thinking that they're ready to buy a house?

SPEAKER_02 2:35

So it depends. There's really three types of buyers. There's the buyer that doesn't think that they have the purchasing power that they actually have, the buyer that thinks they have too much purchasing power, and then there's the buyer that is so well prepared, they've they've done their research, they are well educated on the process. Maybe they've purchased before, maybe they haven't, but they have all their ducks in a row. And you'll see when we get those clear to closes in four days. That's typically the buyer that we're working with. But that said, so the buyer that doesn't think they have enough purchasing power. I met with a couple this morning over coffee, and they didn't think they had enough purchasing power because one of the one of the people she worked part-time, only 20 hours per week, and she didn't have the two-year history doing it. But when I dug into her partner's income, I found out that he's had he's been in his job for three years, he has guaranteed 42 and a half hours per week, plus he's guaranteed 22 hours of overtime per month at time and a half. So, what we found is that their household income was $75,000 plus, and because they had very low debt, they would actually be able to afford about a $3,000 a month payment. So I asked them, now do you guys want a $3,000 a month payment? No, first-time homebuyers. But they they now they know they have the purchasing power, where they thought they might only be able to get a $200,000 house. They could actually get something that actually meets their needs and will support their family's growth in the future. And and then there's the buyer that thinks that they have way more purchasing power than they actually do. So I can't imagine. So their expectations are really high. And you know, with with a buyer like that, we have to we have to manage expectations, but also we don't want to, you know, we don't want to bruise them, right? Because we want them to move forward in the process, because getting on the equity elevator, that you know, the dream of home ownership, it's uh in most cases in America, it's people's largest asset. Yeah. So and and it increases in value. You know, every five, ten years, it's it's going up and up. I mean, that's on average, of course, over the last few years it's gone up a lot faster. So, so with that type of buyer, you know, what we're doing is we're really just showing them. Okay, this this is the math, this is your income. So I'll start with a front-end ratio, which is principal interest taxes and insurance as a proportion of their income. So this is this is what the bank says that you can afford for a mortgage payment without any of your other debt included. And then I show them with their debt to income. So I ask, you know, do you have any of the other normal things that people have? Because I don't want to make it sound like, oh, you got credit card debt, you know, you got a thousand dollar a month car payment. So I say, Do you have any of the normal things that other people have? So credit cards, student loans, car payments. And then they just tell me. And and so then I subtract that from their income, you know, divide it by two if it's a conventional loan or divide it by oh, can't do math right now. That's all right, that's all right. If it's FHA, they they could go up to 56% DTI. So I could pretty much tell them without pulling their credit right there, how much home they could buy, and then I ask them for permission to move forward if they agree with it.

SPEAKER_00 5:57

All right. Well, actually, I you know, I get I get another question, and this is actually just for you know, really us agents. How how do you get them to the point to actually sit down with you and visit with you? Because we have those conversations, those candid conversations before that we actually introduce lenders. Yeah. And you know, where their thought process is, where it is, to try to get them to the next step. What is some advice you could give a, you know, like to us agents to get them to the next step to actually be able to have them open their eyes a little bit?

SPEAKER_02 6:28

Yeah, absolutely. So you guys are the number two authority when it comes to making a referral. A family member or a friend, a direct relative is there. Like this happened last week while I was in Detroit. I was in the airport. Sorry, guys. I was in the airport, and one of the realtors I was with had made a direct referral to me. So direct referral looks like this. All right, it's a group text message. So you guys put me on the text message, the borrower on the text message. Hey, Brian, this is Mike Smith. He's going to be purchasing a home. I'd really like you to have a chance, an opportunity to meet him and talk and you know help him solve his problems that he has. And I immediately jump in that text message. Eric, thank you. Exclamation point. My name is Brian Wilhelm. I'm the mortgage broker that works with Eric. I'd like to learn more about your goals and how I can help you. Please let me know a time where we could spend about 10 to 15 minutes on the phone. Like it's real short, right? Like everyone's got 10 to 15 minutes. The only time that I would not be the person, okay, to have that conversation is if dad steps in. Or dad. All right, or mom steps in or crazy Uncle Dave. Yeah, Uncle Joe, who says, Hey, no, you should use my guy. All right. And you know, we we know that it took Uncle Joe 60 days to close his home, but right.

SPEAKER_05 7:48

We know that, but he's got a guy.

SPEAKER_02 7:50

He's got a guy. So so that's that's that one's hard to win. Okay, but for the most part, my conversion rate with that text message is about 97%.

SPEAKER_00 8:01

That's great.

SPEAKER_05 8:02

That's amazing. Well, my question for you, Brian, is like, what's something that happens during the mortgage process where buyers are like, wait, nobody told me that. Like, what's a curveball that maybe buyers might expect or don't expect?

SPEAKER_02 8:17

I, you know, I think the biggest curveball is wait, I have to pay for an appraisal.

SPEAKER_05 8:24

Really? That's not what I was expecting.

SPEAKER_02 8:26

Yeah, neither was I.

SPEAKER_05 8:28

Wow.

SPEAKER_02 8:28

I feel like there would have been, I don't know, maybe certain paperwork or our process is so streamlined that our borrowers are very well prepared by the time they're making the application. Because I've had that initial consultation with them over the phone. So I've set the expectations. I don't do a pre-approval or send a blind application out without first having a conversation. So I'm asking for documents based on their their income and their assets. So if they work, let's say they I, you know, you get service level with people. So do you work full time? Yes, I work full time, right? That's service level.

SPEAKER_05 9:06

Yeah.

SPEAKER_02 9:07

All right. So so that's awesome. You work full time. So that's 40 hours per week. Yeah, 40 hours per week. Do you ever do you ever you know work 39 and a half hours? Do you ever clock out early? Is it always 40 hours? So what about 37 hours? Have you had that recently? Have you taken any sick time? Because if they don't if they're not documenting a full 40 hours, then that's gonna get treated by by the lender as variable income, variable, variable um hours. Oh, interesting. All right, so then that's gonna require more documentation. So now I'm asking for two years final pay stops, two years W-2s, all right, and current 30 days pay stops because I've got to calculate variable income. So so borrowers are are pretty they're pretty well adjusted to the documents that I'm gonna ask for. You know, what banks do you bank with? You know, I so I ask for 30 days of bank statements for the banks that they bank with. We need W-2s. Oh, by the way, I gotta make sure you're not a terrorist. That's important. Can you send me a copy of your driver's license?

SPEAKER_00 10:13

Right. Right.

SPEAKER_02 10:14

Right. So my so my letter or my email that I send out is electronic application, which takes about 10 to 15 minutes to fill out. It's no big deal. By the way, if you own multiple properties, please include all of your properties that you own. Okay. And if they're just basic salary, okay, 30 days pay steps, 30 days bank statements, last year's W 2, and a driver's license. Let's rock and roll.

SPEAKER_00 10:38

Let's rock and roll.

SPEAKER_02 10:39

I like it.

SPEAKER_00 10:39

Well, let's kind of get into the affordability reality. I know we kind of touched based on it briefly just a little while ago, but you know, really talking about affordability is the biggest thing right now with our market. And a lot of buyers are worried about you know, interest rates and monthly payments. When someone comes to you and want to buy a house, what's the biggest things that you determine that they can afford?

SPEAKER_02 10:58

So, I mean, underwriters are looking at we call it the four C's. So underwriters care about credit, capacity, capital, and collateral. So I like that in that. All right. So credit. What's their credit look like? Do they pay their bills on that? Right. Do they have collections? Do they have charge offs? All right, what's their credit score? So that's that's credit, capacity. So that's how much home can they buy? So what is their income? Right? So we've already talked about front-end ratio and back end ratio. So housing expense and debt to income. So how much home can they can they purchase? Capital. How much money do they have in the bank? Do they have enough assets for cash to close, including their down payment, if they're not getting any seller concessions? And then of course the collateral. All right, there might there might be a pricing adjustment for manufactured homes. It really depends on the lender. So all of those, all right, are going to determine interest rate also. So then that is how we determine how much home that they can afford.

SPEAKER_00 12:20

Okay. Well, you say it determines interest rate, and and that explain that just a little bit.

SPEAKER_02 12:27

Okay. So someone someone who has a 620 credit score, they could qualify for FHA. Okay, but 640 is gonna get them a better interest rate with a lot of the lenders. That's elite pricing. So they're gonna get a better interest rate. Conventional loans. So if they're not putting 20% down, you've got mortgage insurance. So, you know, you might have a low, lower interest rate with FHA, but your credit score is $720. And the mortgage insurance, even a conventional loan, you might have a bit higher of a rate than FHA, but the mortgage insurance is a lot cheaper. Okay. Okay. So that's how we really gotta look at it, really gotta look at it holistically. It's not just, well, you gotta, you know, you've got a 600 credit score, you know, you're gonna be a manual under rate. We look at a look at it holistically.

SPEAKER_05 13:20

Is that also going the same with when buyers are saying like they want to stay around a certain number for payment per month? Are those the same factors that help determine that too?

SPEAKER_02 13:29

Yes.

SPEAKER_05 13:30

Okay.

SPEAKER_02 13:30

Yes.

SPEAKER_05 13:30

I don't know.

SPEAKER_02 13:31

Let's just say FHA is gonna have you know the interest rates, you know, five and a half percent, the mortgage insurance factor is 0.5, so 0.55. So let's say the mortgage insurance is $120 a month. Okay, and then conventional is going to have a little bit higher of an interest rate. Let's say it's last week's rate, so $5.99, but their mortgage insurance payment's gonna be $100 a month. So it offsets the increased interest rate.

SPEAKER_05 14:01

Interesting.

SPEAKER_02 14:02

Okay.

SPEAKER_05 14:02

Interesting.

SPEAKER_02 14:04

Am I answering your question? No, you're a hundred.

SPEAKER_05 14:05

Oh my gosh, you're doing a lot more.

SPEAKER_02 14:09

I can nerd out on some finding. Oh, yeah, we can't do that. Nerd out, please.

SPEAKER_05 14:13

It's so interesting. But I another question that I have is what's something buyers do that dramatically affects what they qualify for when they don't even realize it? Like, what are some common examples?

SPEAKER_02 14:27

Oh man. Um, omission. Omission is a lie by another name. Literally. So um, we're very careful when we're looking at their bank statements to try and find those items that are paid monthly that may not show up on the credit report. So maybe it's a Klarna or an affirm payment. And I use them. There's nothing wrong with them. I use Affirm.

SPEAKER_05 14:54

Yeah, right. Yeah, yeah. No, they're everybody uses them. A lot of people do.

SPEAKER_02 14:58

I mean, zero percent interest and you know, pay it in 90 days. Yeah, yeah. Right. I mean, just increases your cash flow in the meantime. Exactly. Yeah. So omission tends to really hurt when underwriting or title finds things that we should have known that weren't on the bank statements. So, you know, properties. Properties, yeah. Yeah, investment properties. Yeah, that they can get tight. Yeah, that they leave off the application because now, all right. So let's say they own an investment property, you know, free and clear, they still have taxes and insurance for sure. So the taxes and insurance needs to be calculated into their debt to income. So if they were borderline, all right, let's say they were at a 56% DTI on a conventional loan, and they were borderline, and we found out that there were additional properties that were flying under the radar because it weren't on their credit report, there wasn't anything on their bank statements. Oh man. Now, now underwritings found it or titles found it, and oh, we've got to add an additional $500, $600, $700 a month to do the DTI. Like that could hurt, yeah, for sure. So I super emphasize uh please list all your properties.

SPEAKER_05 16:14

Everything, tell me it, tell me all that Eric. Didn't you have someone that bought like a car before closing?

SPEAKER_00 16:20

I did. Oh, nice. I did.

SPEAKER_05 16:23

I feel like that's enough, that's a common one.

SPEAKER_00 16:26

That you don't do anything. No, yeah, so yeah, no, don't do anything drastic while you're gonna buy a house, guys.

SPEAKER_05 16:33

That's the main point of this.

SPEAKER_02 16:35

And disclose everything, don't lie. My favorite, my favorite buyers are the ones that call me or text me. Hey, can I buy gas today? Well, those are the ones that are overworld. Those are the good ones. I need milk, and I know my milk.

SPEAKER_00 16:53

Oh my gosh. All right, so we're gonna we're gonna shake things up a little bit. It is game time.

SPEAKER_03 17:04

Oh man.

SPEAKER_00 17:05

And today's game is called, and I'm excited, Brian. You actually get to do this with us. All right, this game is called Mortgage Red Flag or just Florida. I'm gonna leave my friends from California out of the case.

SPEAKER_05 17:18

I was gonna say we need to give California a break here.

SPEAKER_00 17:21

Because, you know, guys, sometimes buyers do things that make lenders nervous, and sometimes buyers do things that make lenders want to fake a power outage or close your laptop. All right, so I'm gonna give you guys real life situations. You need to tell me if it's totally fine. A mortgage red flag or the loan is completely dead.

SPEAKER_03 17:37

Okay.

SPEAKER_00 17:38

All right. So, first one, buyer finances a six thousand dollar living room set two weeks before closing.

SPEAKER_05 17:43

Why would they do that? No, that's what what was the second option you said?

SPEAKER_00 17:48

Uh, you got mortgage red flag, or or if the loan's just completely dead or totally fine. What do you think of that?

SPEAKER_01 17:53

If it's dead. It's it it depends on DTI. I don't think it's dead. It depends on DTI.

SPEAKER_00 17:59

Yeah, that's true. Okay, good. You don't want to be the one say, hey, congratulations, you just traded your new house for a couch, and you're gonna sit on that while you're on marketing.

SPEAKER_02 18:07

I'm not just saying it doesn't happen. Right?

SPEAKER_00 18:10

Oh, this is this is the one we just talked about. Buyer shows up to closing in a brand new $85,000 truck.

SPEAKER_02 18:17

That's done. Right? Again, it depends on DTI. You know, do they do they have the capacity for it? But most but I mean, I mean, your average, you gotta so you figure average household income in the state of Florida is what $67,000. Yeah. Yeah. Most households cannot sustain that payment and still close out their home. Yes.

SPEAKER_00 18:42

All right. So so basically what we're saying is good news that drug payments approved the house, and not so much. Yeah.

SPEAKER_02 18:48

I mean, do you have does your does your house have or does your car have really good heat and air conditioning? And does it is it comfortable to sleep in? Yeah, does the bed fall down?

SPEAKER_00 18:57

Right. All right, down payment from Uncle's shoebox cash. No. No. No.

SPEAKER_02 19:04

Yeah, no, no, no mattress money.

SPEAKER_00 19:08

I guess keep it for yourself. The very popular Uncle Tony under the mattress loan program. Underwriters love that one, don't they?

SPEAKER_05 19:14

Sorry if you guys have all these Uncle Tony's Joes that we talk about today.

SPEAKER_00 19:19

We talk about them all the time, you know, all the time. How about this? Scenario number four is a truck about A T B payments. But once something affordable, repeat that. So they have a truck about AT and then like an ATV or whatever you want payment. But once something affordable.

SPEAKER_02 19:35

Um, so Facebook Marketplace.

SPEAKER_00 19:38

Okay.

SPEAKER_05 19:39

Good answer. I love Facebook Marketplace. You do that.

SPEAKER_02 19:43

Time to unload something.

SPEAKER_00 19:44

That's right. You don't need a mortgage. You need a financial extra system. That's right. You do. All right. $18,000 deposit labeled gambling money.

SPEAKER_02 19:55

Oh my gosh. All right. This is a tricky one. Oh, it's just a tricky one. I don't know.

SPEAKER_05 20:02

I'm leaving this up to Brian, and I'm saying that's gone.

SPEAKER_02 20:04

Well, I mean, I'm not an underwriter. So I could only go off of things that I've seen or heard. So part of underwriting is is, you know, it's a character assessment. And their bank statement, does it show that a ton of money that their discretional income is going to a casino on a regular basis? It's up to it's underwriter discretion. So one underwriter might look at that differently than another underwriter. But as far as but as far as for down payment, I mean, can we source it? And is it documentable? Wow. Interesting.

SPEAKER_04 20:38

I didn't expect that.

SPEAKER_00 20:39

Yeah. I was gonna say nothing makes an underwater underwriter happier than unexplained casino winnings three weeks before closing. All right, next one is buyer quits their job because of vibes. And this is in the process of going through this.

SPEAKER_05 20:54

Oh my gosh.

SPEAKER_02 20:56

That's I've got a rescue story for you guys. Oh please, go ahead. All right. So last last sorry, so last year I did a refinance for someone that I've actually become very good friends with her family since I wasn't the original lender on the loan. She changed jobs midway through the application process. So in underwriting, she changed jobs. But for whatever reason, the underwriter wasn't aware that she changed jobs, so it was never documented as part of the loan file. So when the lender, so the bank, institutional, okay, went to sell the loan on the secondary market, they were sold the loan back because the documents didn't line up with the truth of the file. So that lender, rather than working with the borrower to get it straightened out, triggered the do on sale clause and called the loan due.

SPEAKER_05 21:57

What explain what that is?

SPEAKER_02 21:59

So there's there's a clause in in most most mortgage documents that if there is a change in status of the property so it's been sold refinanced assigned uh not not all loans are assumable right then the lender has the right to say pay me my money no way uh give me my money back and so that's what happened to her that's what happened to her wow so and now in this like a year's gone by so her credit had changed her income had changed her debts had increased she could not sustain a she could not refinance on her own so I had a conversation with her and her parents and got them involved because she's got kids like she can't lose her house right so there was a lot of there was a lot of you know massaging to get this to work but she now has a viable mortgage she was able to refinance we're waiting for rates to drop a little bit lower her interest rate's terrible guy was like seven percent interest rate time so we're just waiting for her credit score to get a little bit higher rates to come down a little bit lower we'll go ahead and we'll refinance our parents off that property yeah wow that's a good save on your I can't believe I did not know that that was a clause yeah yeah so read the fine print and tell the truth and nothing but the true yes that that's that's the lesson in that yes all right next scenario parents tell you your credit score is good at 528 parents yeah get truthful parents yeah most of the time your parents are gonna say something because they also told you the Santa and Easter Bunny were real yeah maybe need to double check things yeah all right next one a waterfront so the buyer wants waterfront pool no HOA no CDD remodeled and under $300,000 in St.

SPEAKER_00 23:55

John's County does that even exist just in Florida right no that ain't no that that's non-existent literally non-existent that borders on St. John's County you could do yeah you could do a swamp front property you can tell somebody yeah I've got one of those it's called 1998 all right next one buyer quits job and flips to crypto and and NFTs deal's dead that was so fast yes nothing reassures a lender that a brand new income stream based entirely on internet cartoons my favorite phrase in lendiness the buyer has no savings but he has good vibes let's do this all right he also has a 480 credit score probably unfortunately the bank doesn't accept vibes but they do accept money yeah yep they do yeah ready this is a good one this is one of the very last ones here oh my gosh the evil lab airs up to something this is called the Zillow math buyer all right buyer says Zillow says the payments should be right around $2100 a month but of course the taxes are wrong insurance isn't included hoa isn't included and rate is out of date so the actual payment is thirty one hundred dollars a month the moral of this is you gotta do the research and go through it.

SPEAKER_02 25:26

For sure yeah so and talk to someone local like someone who knows the area because a lender in California doesn't know that that the mill rate is 18 in Duval County and that the county assessor's office takes 85% of the purchase price as the assessed value.

SPEAKER_00 25:44

All right so basically what you're saying is these third party sites is like gas station sushi it sounds good until you realize the consequences I had to put that in for you to do purchase that game gas station sushi I can't believe that's even a thing oh yes it is okay one more time the buyer tells a lender I've done a lot of research okay and my research is TikTok Zillow their uncle and one YouTube video. Back with the uncle poor uncle what is so tell me what does uncle do for work yeah yeah what does uncle do just good for you will give you the information you need to use to research exactly so now basically what what you're hearing is the the mortgage approval process is now being supervised by TikTok and Uncle Dave.

SPEAKER_05 26:32

Yep yep yep pretty much all right well that's our game for the day I hope you guys enjoyed that that was funny some of these some of these scenarios I've just like some of jaws on the floor gotten really bad.

SPEAKER_02 26:43

Yeah I'm still yet to top the gas station sushi situation that was really that was a good game I I ate my bait once by accident what did he say and so I'm thinking like the result would that would seem like gas station sushi would be like yeah just like that oh my god okay my headphones are straight turning oh man okay so things that buyers do that kill their loan all right so the this should be kind of fun to talk about what are some things that buyers do during their mortgage process that make lenders panic oh goodness I stumped a no like I've got I'm seeing people's faces right now the ghosts are coming back to haunt me I've actually heard this before so yeah we uh yeah we use this business as some kind of a kind of our you know our splash fund so you know you do what you do okay so do you are are you employed by the business do you have ownership in the company no oh my gosh why why are you being shady then don't just don't say shady stuff right oh my gosh we had somebody on our team that was selling a house and their employment was only fans what I did not know that how do you handle that Brian I haven't had an OnlyFans yet tell me what happened after the oh I will okay I haven't had an OnlyFans yet it's interesting right yeah it is I mean if the if if they're filing tax returns AI is gonna zoom in on my face like I'm speechless right now I mean they're I mean they make good money probably yeah no no they make probably wonderful money I was just trying out to there's been times in this business where I'm like I need to start an only feet yeah like yeah you know I've highly considered feet picks you know I need to hear the story after this sorry we can't say it on the podcast that's okay we we can get as crazy as we need to be so awesome which leads into my next question for Brian Brian what is the craziest situation that you've ever seen someone do that almost lost their loan mortgage fraud you're gonna lose your loan immediately because I don't even play with that yeah absolutely not I had was working with an investor that was really kind of in a desperate situation it was another an another rescue loan they had a hard money loan that lender was was just feeing them to death they wanted their money the investor wasn't familiar with the market they were based out of California so they didn't really know where they were buying or what they were buying and they because they had originally wanted to flip the property right okay so sometimes we have to do a DSCR rescue all right so but to do that we need the rent on the property to at least be on a one-to-one ratio to what their payment is going to be so principal interest taxes and insurance and so this investor created a lease on the property in his wife's name in California wait yeah I'm done with them at that point so he sent you the information under his wife like all his wife's information then so the lease was in his wife's name yeah how could his wife have be a a be a renter in the state of Florida when she lives in California right boom so yeah audacity what are you we we see that stuff every now and then but that's a dead loan that is for sure yeah no whiffans or buts about that one that one's ridiculous that's wild I got stories I want to hear more we could like you say we can probably sit here all day and do that okay a question I have then is there anything buyers should should absolutely not do between getting pre-approved and closing yeah don't change your status on anything I'm pre-approving you based on how much money you have in the bank and your income so and your credit so don't change your status keep your bills paid pay on time set up on set set up automatic payments so you don't have to worry about it and you know without a shadow of a doubt that money's getting paid as long as you have money in your bank account keep the money in your bank account just keep it there keep it there because that's what that was kind of leading me to the next one like what are some things that buyers should actually do like I don't know six months before buying a home just to kind of prepare I mean talk to one of us I always encourage that yeah we'll pro we'll prepare I do I do more preparing people to purchase in the future than I actually do applications because it's it's important like this couple that I met with this morning they're getting married in a few months they're planning on purchasing a home in the next six months so I just I ran down it with them just like I was doing an application with them. And so here's the thing so they're paying $1300 a month for rent okay they want to pay $1800 a month for a mortgage so principal interest taxes and insurance I put in that calculation that I did that there was also a homeowners association because it's Florida. Yeah right there might be CDD like we don't know where they're going. So I added that in the equation I said all right guys so you're looking at about $200,000 house. Yeah all right so here's what I want you to do I want you to take the additional $500 that it's you're gonna be paying on your mortgage payment and I want you to start putting that into a savings account every month. All right get used to making the extra payment by saving the money and guess what they're also doing they're tricking themselves into a down payment. Yeah oh yeah that's smart that's real smart so it's everyone's situation is going to be different right it's real so all the advice that I gave it it's it's custom tailored to their specific needs there's their specific situation. Yeah okay but but best thing is just talk to you talk yes just talk to talk to Brian yes you know fifteen fifteen minutes could turn into an hour and if we have to set up another appointment or meet in person then that's what we do. Yeah yeah just get you on the right foot I try to meet everyone in person before they go under contract.

SPEAKER_00 33:21

That's good I'm I'm glad you do that because that's really important. Yeah well let's talk about the area for a minute you know getting hyper focused in northeast Florida. So since that's where we're at we're seeing buyers that are coming here from all over the country you know what are you seeing when it comes to affordability buyer demand in loan programs here in Northeast Florida.

SPEAKER_02 33:40

I mean affordability has been an issue now for a couple years. Yeah and you know when we're talking about affordability it's I it goes further than debt to income it it's a really for a lot of buyers I mean they can afford it set you know incomes have increased along with inflation so we might see they could afford it but mentally all right they're not thinking what it's actually gonna cost to be a homeowner. Right. So it's it's really getting them inch by inch it's a cinch so my buyers this morning all right they know 200 000 so when they go out and look with the now they could afford 300 000 okay so based on ratios so when they go out looking with the agent and maybe they love what's in that price point but maybe they don't so that'll be another conversation of okay guys so if you if you were to make an extra $200 a month payment you know how is that going to make you feel right you guys as realtors have a distinct advantage over lenders. All right we deal you know logical side of the brain 99% of the time but you guys are dealing in emotion. Oh yeah we are and if we know anything about people we make decisions based on emotion but money is logical so I I go back to this meeting I had this morning we're talking about numbers we're not showing houses okay it's it's black and white this is this is what I believe at this moment this is what I feel I can afford people will spend more if the value exceeds their expectations right exactly so that's a distinct advantage that you guys have as realtors.

SPEAKER_00 35:30

Well could you know are there are is there programs right now for for those buyers to kind of get them into the next edge that people don't even realize exist that could help them get into a home like FHA BA first time home priors is there any other like other programs besides the norm?

SPEAKER_02 35:42

Down payment assistance programs and there's tons of them hometown heroes which is a silent second as you guys know but it doesn't take into account that second payment zero percent interest so it doesn't count that payment in their DTI. There's other programs out there that when you're getting in a down payment assistance so what the underwriters are looking at is is the risk profile no down payment means higher risk. So the underwriting criteria is going to get a little bit more stringent. All right interest rates are going to go up with a lot of down payment assistance programs and sometimes that increased interest rate is going to offset the the down payment okay right so the monthly payment goes up you know I I you know I always tell all my my buyers that they're preliminary looking at this like hey there's a plethora of different programs out there more than this getting advertised more than this talked about the best thing to do is to sit down with the lender and go over that there's no cost to it they want to help you out just as much as I do.

SPEAKER_00 36:45

So let's just sit down and and and talk to them. Yeah you don't know until you know exactly and I would rather have you have the education to make the best decision that you can because really people have that buyer's remorse when they don't know and just jump into things. Yes you're right we're on the emotional side of things but if we can educate them a little bit absolutely so they feel like they're making the decision and they're making the best logical decision for what their lifestyle needs at the moment they're not going to have that two, three months down the road where they're going, oh God I can't believe I did this because numbers are numbers.

SPEAKER_02 37:15

It really is so I mean you we're not the ones that have the we don't have to stroke that check every month.

SPEAKER_00 37:21

They do right but you know one of the biggest takeaways from today is this buying a home just isn't about finding the perfect kitchen, the perfect backyard or the perfect neighborhood. It's about understanding the numbers behind the dream. And that's where having the right team around you really matters right now.

SPEAKER_05 37:36

It really does because a lot of buyers think they need everything figured out before they talk to someone but the truth is the earlier you talk to a lender and a realtor the easier the entire process becomes you'll get your plan down you understand your options and you avoid the mistakes that can slow things down for you.

SPEAKER_00 37:52

Yep and honestly buyers are closer to be ready than they really truly think and Brian I'm sure you've seen that a lot sometimes it's just a matter of making a few small adjustments making a down pay down excuse me making paying down a credit card or maybe understanding that your loan has different options and suddenly that dream of owning a home becomes a lot more realistic. I tell you what this is what really it is about the show. You know we're pulling back that curtain on and really giving you the the real information to make those decisions. And if you're really thinking about buying a home selling a home or just want to understand what your options look like here in Northeast Florida, reach out to us at the Rakers Home Group. Give Brian a call anytime you can tell he loves talking on the phone he loves talking this guy for coffee this guy this guy is awesome. He's great and if you got questions about the market the mortgage or anything real estate shoot us a message drop a comment follow us on social media or give us a call we're always happy to help. Until next time guys keep learning keep asking questions and we're all going to keep on raking this real estate thing together so talk to you next week.

SPEAKER_05 38:55

See you guys later. Thanks for having me guys