How can I beat the high interest rates when buying?
How can I beat the high interest rates when buying? by Kurt Wannebo I keep having the same conversation with Buyers right now who say you know what, the interest rates are too high we're not going to purchase a property. But yet here at the end of 2022 as interest rates continue to rise we're still working with Buyers who are moving forward and purchasing homes. Now why are they doing this? Are they just paying these high interest rates because they have to? No, we've actually implemented some strategies for our clients to actually beat the current interest rates. The first thing that we're leveraging and doing for our buyers is we're introducing them to local banks and lenders. Lenders that lend their own money and don't simply borrow it from somewhere else package alone and then sell it off to Fannie or Freddie. Some of these local banks, because they're lending their own money, are perfectly fine and have interest rates that are one to two percent lower than some of the big banks. And they're perfectly fine generating these loans, making a good return of five percent or so. We introduce them to these local banks and lenders. And if you want to know more let us know. Second thing that we're doing is we're staying in tune with all of the big banks and all of the other lending channels out there to understand the new products that are coming out to the market. The one thing you need to understand is even when the market slows down banksneed to generate loans in order to run a business. And they understand that these interest rates are kind of high and so they're coming up with a lot of creative ways to get people off the fence and into the buying Market. One example would be some of the banks have a programwhere the first year of your home ownership your interest rate is two points below what the current market rate is. Then the second year, it's one percent below and then the third year itadjusts to what the market rate is today. And the hopes are, maybe in two to three years that rates will come back down and you can refinance. If not, you're just back to the interest rates of what they're at today but you had some breathing room. So lenders are coming up with new programs literally every day and we're staying on top of them and educating our buyers about that.The third way that we're doing this is we're actually educating our buyers on thebenefits of correctly utilizing an armed loan or an interest-only loan. These are loans that some of the most sophisticated wealthy people have used in any market and use all the time tohelp leverage their money. And there's absolutely a correct way to use these programs in order to keep your costs lower. Another strategy we're utilizing is we're going out there and we'refinding properties where the sellers are willing to buy down our buyers interest rate. Sometimes as much as one to two percent. What that means is our buyers are getting a loan but their interest rates are one to two percent below everyone else's because the seller is paying up front for those rates to come down. And that's great for our buyers and they don't even have to pay for the cost of that. With that being said if you have any questions about some other strategies or hear more about these ones in regards to beating the current interest rates give us a call and we'd be happy to go through it with you.
What is a bridge loan?
What is a bridge loan? by Kurt Wannebo One of the questions I've been running into more and more from homeowners today Is: “ Are there Bridge loans out there?” “What are they?” “How do they work?” And it's interesting because for some of my older demographics they're very familiar with Bridge loans. Because they used to be around in the 70s and 80s and even early 90s. But really haven't existed much in the 2000s. and so in essence I wanted to go through what a bridge loan is and some of the benefits or downsides of utilizing one. So again one of the problems that I'm seeing with sellers is they're wanting to sell their home and go out and buy a new one. But the inventory is very low here in San Diego County right now. And what that means is there's not a lot to choose from and they're not necessarily always liking all of the properties they see out there. And they're wondering how long is it going to take for me to find that next property? Also they have to sell their property or unlock the equity that they have in it in order to buy the new home. So what a bridge loan does is it steps in and what that allows you to do is keep and own your own home, go out and find the new property first on your timeline. And when you're ready and when you find something this bridge loan will allow you to buy the property based off of the equity you have in your current home. Once you get that loan, the bridge loans temporarily move into the new home you sell your old home. And when you unlock that Equity you roll over and refinance into permanent financing for the new home. Now there are some pros and cons to a bridge loan. The pros obviously is it gives you that luxury of taking as much time as you need to find that perfect property. And not worry about selling yours and you know you have to find a temporary Home. The downside is sometimes they are higher interest rates, because it is a temporary loan and they're incurring some risk based on the premise that you still need to sell your property. But nonetheless it's been a great resource for many of our clients who are concerned about this low inventory and concerned about selling their home before they find the right property out there for themselves. So if you want to hear more about these options and if they're right for you we have access directly to these lenders who are doing these Bridge loans today. Give us a call. We'd be happy to give you a consultation and walk you through the process.
15,000 homeowners failed to sell last year, do you know ANY of them?
15,000 homeowners failed to sell last year, do you know ANY of them? by Kurt Wannebo Today I’m going to cover one of real estate agent’s dirtiest secrets that they don't want you to know about and they don't want their clients to know about. Let’s be clear here, a lot of other real estate agents are going to be extremely and really mad at me for putting this out there and on video. But i don't care because you see I dedicated my career as a consumer advocate and doing what's in my client’s best interest. First, I have to start by educating you on something about what agents do to market your property. Yes, they market it all over the internet into the world and they create videos and they create brochures and you might think that's all great and that's all they do but there's actually another part of marketing at home to sell that agents do and that is the marketing they do to other real estate agents. There's a lot of different ways that they do this. They send out email blast, they do it through networking, they do it through broker caravans or in office meetings or communications and they also do this through the mls. Now, the mls has actually a little section in it called Confidential Remarks and this is where agents can put some notations in there which only other real estate agents can see. It doesn't go out to all of the different marketing websites and consumer doesn’t see this. Now some agents use this little confidential remark area to inform other agents about maybe a dog in the house. “Hey Sparky’s in the house, when you show it. He’s friendly, don’t worry about him” or “Hey, there’s a cat in there, don’t let the cat out”. Other real estate agents use this Confidential Remarks to convey the seller's motivation and why they are selling. Now, what do I mean by that? Or what is it that they say? Well, it isn't very uncommon for me to see that agents would put in there that the seller is very motivated, let's think about this for just a moment, seller is very motivated, if the seller puts their property on the market obviously they’re wanting to sell so there's some level of motivation there but the fact that they're putting that back in there in big bold letters actually mean something. Other comments they might put in there is that seller is very motivated and bring us any and every offer or any all offers. I even saw one recently in the MLS that actually said “seller is very motivated and will accept all offers”. Now, let me clarify what the term “Accept” means, that means, if somebody were to submit any offer that the seller would accept it, and in our contract terms, that mean they would accept it and move on to escrow. Now how do they do this? They will send this out through marketing. Here’s an example right here. This is an email blast that I got from a very prominent, well known real estate agent, marketing a property or listing that he has and in that email it says “Motivated sellers, bring all offers. I went to show the property the other day, I was previewing it for a client. As soon as my preview finished, the agent texted me “Seller is super motivated, just send us anything.” So text, emails and the MLS they convey all of this stuff here. Now let's think about this one more time, here you are, you probably hired your Real Estate agent, who told you that they're going to get you the highest and best price, and now they’re running around telling all the other agents how motivated you are to bring any and all offers and you might not even know about it. Now, I don't do this, I would never do this. Why? I don't do it because, first i feel it cost my clients money. I also feel that you're giving away negotiating leverage to be able to command the highest price and lastly, without my client’s approval, I just feel it's unethical and shady. Now, may I ask how often do agents really do this? Well, the answer is, more than you would actually think. It is happening more and more, especially since the market has started to shift and agents aren’t prepared for this. Now, why would they do this you’d ask? Well, you’d have to understand that most real estate agents here in San Diego, they’re only selling 3 homes a year and they just don’t have the negotiating or the marketing skills to attract buyers, especially on a slower market, and deal with them so they have to revert to this secret marketing through agents. Another time agents actually like to do this quite often, is if they have a contract with somebody to list their home it’s usually for a specified period of time and if that contract’s expiring, usually at that point when it's getting close, the agent will start letting other agents know “Hey just submit any offer or send me anything” so that they can rile up their client and maybe provide something to them or an offer that they haven’t provide through that entire time and maybe keep the relationship alive and again as we said before, this market is shifting, be very clear about that even if you're not seeing it in the news. It's taking longer to sell homes. Buyers have more choices and so some agents instead of being able to ramp up their marketing, just to entice buyers, agents start using these tactics. Again, do I do this? No. I wouldn't do this without my client’s permission. And you know what? I've never had a client tell me. “Kurt, you know what? Can you please tell every buyer that I would accept any offer and I’m super motivated?” No, they actually want the opposite. It’s just against my ethics and morals to do this behind my client’s back. Now, again, let’s be very clear here, there are going to be a lot of real estate agents that are going to be really upset that I posted this video, but again, you know what? I don't owe them anything. My loyalty and duty is to my clients and i feel the consumers. I don’t want to be like those other agents and i believe it’s this thinking that has got me to the point of my career where I helped over 1,200 families and I’ve gotten over 500 5 star reviews all over the internet. So this is something that you want to take into consideration if you're considering putting your home on the market, this is something you might want to ask your agent. What do you put in there? Do you put fliers out there telling the buyer’s entire agent that “We’re super motivated”. Can you show me and prove that you don't do that? And hopefully this will just give you something to think about if you’re considering putting your home on the market because again, I feel these tactics can actually cost you 10, 20, 30 thousand dollars when it comes to the sale of your home. Thank you for watching. I’m Kurt Wannebo. Have a great day!
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