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- เผยแพร่เมื่อ 29 พ.ค. 2024
- NBC News' Brian Cheung reports on how some homebuyers are finding creative ways to pay for their new homes with a lower mortgage rate than they expected.
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#Mortgage #Homebuying #Economy
In the early 1990s, when I bought my first home in Miami, first mortgages often came with rates of 8 to 9% and 9% to 10%, which was quite common. It's important to consider that we may never return to 3% rates. If sellers are compelled to sell, home prices may need to decrease, leading to lower valuations. I believe many others share this line of thinking.
If anything, it'll get worse. Very soon, affordable housing will no longer be affordable. So anything anyone want to do, I will advise they do it now because the prices today will look like dips tomorrow. Until the Fed clamps down even further, I think we're going to see hysteria due to rampant inflation. You can't halfway rip the band-aid off.
Home prices will come down eventually, but for now; get your money (as much as you can) out of the housing market and get into the financial markets or gold. The new mortgage rates are crazy, add to that the recession and the fact that mortgage guidelines are getting more difficult. Home prices will need to fall by a minimum of 40% (more like 50%) before the market normalizes. If you are in cross roads or need sincere advise on the best moves to take now its best you seek an independent advisor who knows about the financial markets.
I’ve been worried sick about the current state of my portfolio, who is your advisor?
Sharon Lee Peoples is the licensed advisor I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.
Thank you for this amazing tip. I verified her and booked a call session with her. She seems Proficient.
I think it's time to make it more appealing for potential buyers. Real estate can be quite the rollercoaster! the stress and uncertainty are getting to me. I think I'll cut rents to attract potential buyers and exit the market, but i'm at crossroads if to allocate the entire $680k liquidity value to my stock portfolio?
"Overall, buyers hold a lot of the cards right now, and sellers are having to give out more concessions to close a deal." All the best, buying on sale is actually one of the best ways to invest in stocks, and advisors are ideally suited for such task
I agree. Based on personal experience working with a financįal advlsor, I currently have $2 million in a well-diversified portfolìo that has experienced exponential growth from when i started. It's not only about having money to invest in stõcks, but you also need to be knowledgeable, persistent, and have strong hands to back it up.
Your advisor must be really good. How I can get in touch? My retirement portfolio's decline is a concern, and I could use some guidance.
'Melissa Elise Robinson' is the advisor I use. Just research the name. You’d find necessary details to work with to set up an appointment.
Thanks for sharing. I curiously searched for her full name and her website popped up immediately. I looked through her credentials and did my due diligence before contacting her.
Great video! For 2024, it’s hard to nail down specific predictions for the housing market because it’s not yet clear how quickly or how much the Federal Reserve can bring down inflation and borrowing costs without tanking buyer demand for everything from homes to cars.
A lot of folks have been going on about a market rally and said that stocks would be experiencing significant growth this period any idea which stocks this may be? I just sold my home in the Boca Grande area and I’m looking to remunerate a lump sum into the stock market before stocks rebound, is this a good time to buy or no?
I took charge of my portfolio but faced losses in 2022. Realizing the need for a change, I sought advice from a fiduciary advisor. Through restructuring and diversification with dividend stocks, ETFs, Mutual funds, and REITs, my $1.2M portfolio surged, yielding an annualized gain of 28%.
I will be happy getting assistance and glad to get the help of one, but just how can one spot a reputable one?
TERRI ANNETTE MOORE is the licensed advisor I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.
I find this informative, curiously explored Vivian on the web, spotted her consulting page, and was able to schedule a call session with her, she shows quite a great deal of expertise from her resume.. very much appreciated
Never thought about this. Congrats to everyone who can take an advantage of this.
Im happy for this couple and their family ❤
I’m glad at the end they mentioned that assumable mortgages are not advised if the owner has a lot of equity. Why you may ask? Because you have to pay the difference as your down payment.
So if they've been in their house for say 10 years and paid off 120k in principal, now the buyer has to put up 120k themselves if I understand that right. Does the buyer also have to put in a new down payment and repay closing costs? I assume so as well.
@@MrNightpwner correct for the first part and no for the second part in regards to paying an additional down payment. The difference the buyer pays is the new down payment. Yes, they do need to pay the closing costs as well.
@@joelpicolo7306 question. I have a fha loan 4% 200k. House has appreciated worth about 450k now. So over 200k equity. If I listed it for 550k using this method the buyer would be paying 100k over and need to have over 200k up front but the 3% loan difference will save them well over that 100k in interest for the life of the loan. Do you think this is something that would actually work for both parties or am I missing something? Thank you for any advice and knowledge in advance
@@MrNightpwner more simply explained, the buyer has to cover the difference between the purchase price - loan balance. You’re forgetting about the appreciation over the ten years.
@@waynepetersen9082yea and that can be easily over a hundred thousands of dollars
Great to hear about a realtor that understands creative strategies! There could be opportunity for so many sellers to sell if more agents would learn about legal creative strategies to purchase. Getting a home loan directly through the bank isn't the ONLY way to purchase a home!
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Just to clarify, this strategy still required them to get a loan from the bank, they just assumed the current mortgage versus getting one with a different lender. Also, the strategy worked well for them because the seller didn’t have any equity. If they had a lot of equity, the buyers would’ve had to pay the difference in cash, which could have been tens of thousands or hundreds of thousands of dollars.
This only works if a seller is desperate like they need to sell or else they'll have to foreclose.
Very happy for the second half of the video. It’s not nearly this simple and they explained it well in a short time.
Guys to do an assumable mortgage. You would have to pay the difference in equity.. meaning if there mortgage is 400,000 and they are selling you the house for $500,000 you are responsible to pay that $100,000
Seller can carryback financing or you can get a secondary loan.
@@TheNativeTwo but then the secondary loan would be at todays market interest rate. All im saying is its not as easy as it sounds.
Jesus why didn't they just say that. I had to watch 4 times. The news narrator and realtor are bad at explaining.
Not just that, if they mortgaged 400,000 and the house is worth 500,000 and they've already paid off 50,000 you would have to pay 150,000 up front. You need to pay the part they've paid off as well when calculating that equity.
@@KenW418that 50k couldnt be in the loan? i dont see why not
I have heard of this. The problem is that a person that wants to move has to try and find a house that is eligible.
I am happy for them.
The government is going to ban this soon😂😂
No they won’t
No they won't. Assumable mortgages are nothing new.
That's nothing new lol
This administration is culpable of anything you thought wasn’t possible 😂
It's been there 4 ever
Very happy for this family!!!
Good for them! What sweet family. ❤
Great if the owner kept up with property taxes if not you become responsible for the back pay for the mortgage.
Oh I totally didn’t think of that 🤔. Good point.
Most likely, the taxes and insurance were already included (escrowed) with the monthly payment as this is a requirement with most lenders and I'm sure a title/land search was done as well before signing docs.
Taxes are included in mortgage payments
If there was a tax lien on the house, they wouldn’t be able to sell it?
A lot of people think the mortgage rate is the only major factor to consider when buying/owning a home, but dont forget the property tax. That can fluctuate as well arbitrarily. They can "appraise"/value your home based on market conditions and that could increase your property tax significantly and put you deep in a hole as much as the mortgage rate can if not more. This system is not for you.
my taxes/appraisal value has not double in 20 years Nassau County LI - meanwhile rates/mortgage payments doubled in 2 years - dont think the hole is as big as you think...
@@thepawns3835 lol I had to Google Nassau county LI. Surprised to find you're talking about long island. I would've thought property taxes would've increased there. But Google also seems to support your claim. Looks like they have republican legislators there that prevented any increases in property taxes for at least the last 14 years. That's pretty good for you guys. Congrats. Maybe I should move down there.
Lol my bad. I also forgot to mention home owners insurance. Your homeowners insurance might increase if they feel the "value" of your home increases for whatever reason. So there's that too. Basically there's always something to pay for and for the rest of your life.
Yea my property taxes were reassessed randomly and my escrow payments went up by $600. It’s a good thing I had the salary for it because it would have ruined someone else.
Love it. This could help a lot of ppl if they can handle the upfront costs.
Creative Ways!
Wow! That's was some great information.
It was used a lot in the 70s and 80s. It takes a lot to buy out the seller but it works. I called this months ago
I'm hoping there will be a housing crisis so I can buy cheaply when I sell a few houses in 2025. As a backup plan, I've been thinking about purchasing stocks. What advice do you have for choosing the best buying time? On the one hand, I continue to read and see trading earnings of over $500k each week. On the other side, I keep hearing that the market is out of control and experiencing a dead cat bounce. Why does this happen?
Investing in real estate and stocks might be a wise choice, particularly if you have a sound trading plan that can get you through profitable days.
You're not doing anything wrong; you simply lack the expertise necessary to make money in a bad market. In these difficult circumstances, only really skilled experts who witnessed the 2008 financial crisis can expect to generate a large wage.
@@HRMColoniallifeinsurance Recently, I've been considering the possibility of speaking with consultants. I need guidance because I'm an adult, but I'm not sure if their services would be all that helpful.
My CFA, Desiree Ruth Hoffman, is a renowned figure in her line of work. I recommend researching her credentials further. She has many years of experience and is a valuable resource for anyone looking to navigate the financial market.
Thank you for this tip. I must say, Desiree appears to be quite knowledgeable. After coming across her online page, I thoroughly went through her resume, and I must say, it was quite impressive. I reached out to her, and I have booked a session with her.
The issue with an assumable loan is that you have to come up with the asking price and existing mortgage balance difference. 3-5% down payment becomes 20%.
It seems this couple has worked with a great realtor! Congratulations to all parties involved!
Its not that simple. The seller has to agree AND the buyer most likely does not have the cash pay the gap between mortgage and purchase price. It is also an extremely lengthy process.
I looked into this as a home seller as a possible way to increase my sale price. Not all mortgage companies allow this, unfortunately, mine included.
Very true. That’s also part of the story they don’t tell you.
In my country morgages are around 10-11% although its fix for the entire loan.
Wow a Realtor who actually earned their commission
Very creative and truly worth it if you have the equity built into the house.
Just to clarify, this strategy worked well for them because the seller didn’t have any equity. If they had a lot of equity, the buyers would’ve had to pay the difference in cash, which could have been tens of thousands or hundreds of thousands of dollars.
Not as easy as it seems. Longer closing time and you need to pay the equity difference in cash.
But 2 or 3% lower interest saves you 100-500k over the life of the loan.
@@stown308 Most people don’t have hundreds of thousands of dollars available to pay the difference in the potential equity that a seller may have, so this technique is quite rare in practice. It really only works when there’s little equity in the home.
This is very rare, only a few hundred available per year
That's amazing!
Wow, that’s awesome.
Awesomeeeeeeeee! Chris will have another helper assisting him soon. 🙂
There aren't many of those loans out there like this. Also the seller has equity who is paying for that? Their not telling the whole story!!!
You have to pay the difference or equity. You heard that they only made payments for a year and a half. They didn’t pay down much and house likely didn’t appreciate much. Not much equity or difference in the loan vs value.
There should be different tiers for first time home owners interest rates, we shouldn’t be competing with multi-billion dollar companies for first time homes.
Licensed LO and Realtor here…I’m glad they mentioned Conventional Loans are NOT assumable. There is a concept called “subject to” financing that a lot of social media reels talk about that’s basically a non-approved way to assume a Conventional. The videos make it seem it’s the same but in actuality, it’s breaching the contract and hoping the lender doesn’t notice or care. Be very wary of deals where someone mentions “subject to” or taking over an existing Conventional Mortgage
Only certain loans are assumable though and often times the buyers must have lots of cash on hand to pay the difference 😔
It only takes like 6 months for the loan to process.....
God bless that family
Basically I got a rate at a certain price knowing I could double down up front and got a locked in rate.
They failed to mention that if new buyer default on the loan, seller is still liable.
Which is why this is extremely rare. If I'm the owner of this house and sell this way - I LOST
Not true on VA loans. Its two parts. One is the mortgage and two is the VA guarantee. Any buyer can assume a VA mortgage, and the buyer is responsible to pay that mortgage, period, end stop. If that buyer defaults, the seller is not on the hook financially for that mortgage. What is on the hook is the VA guarantee. The seller may not get their VA loan benefit restored until that mortgage is paid off. However, if the seller sells to another person who has and will use their VA loan benefit to fully assume the mortgage (part 1+2), the seller is not responsible for the mortgage and can immediately petition to get their VA loan benefit restored and available to make another VA home purchase. In no case is the seller liable for the buyer defaulting on the mortgage.
@@free-qe6wx wild. these things are always more complicated than the surface. thank you for the explanation.
So it’s bs for 77% of buyers
Yes; If not 90% of buyers 😜😂
Im happy it worked out for them
The rates were artificially low due to the pandemic. This is about the norm. This is really a VERY specific situation where it worked.
It takes 4-6 months to get the paperwork processed.
Just what i needed to know
This ia the type of info you *DO NOT* put on National TV for the government to shut down
It’s been around a long time, it’s nothing new. Government already knows about it and actually allows you to find houses that are more eligible on your county website
One trick we just did when purchasing our first home (closing in a couple weeks) is buying down the interest rate to 5.6%. Of course not everyone has the means to do that but calculating it out it should pay off after about 7 years (we wanted to buy down more to around 5% flat but the mortgage company limited us on what we could put down for that). We didn’t see rates dropping too drastically in the next handful of years either so we didn’t want to gamble on being able to refinance.
So tired of tic tok being referenced in “journalism”
Well news is news. I go tell a buddy something I heard in person that’s news. Tik tok only streamlines it. No I don’t use Tik tok
Im happy for this family
Good for them. It’s not common and easy to do. But always ask if the loan is assumable.
You will most likely have to put a larger down to cover the equity difference. So that’s the biggest challenge
If the sellers jsut want to rent or downgrade this works. If not, who would want to give up their mortgage for a higher rate
It’s not the rate it’s the price people
Its so impossible to buy a house right now... income over 100k and still cant get it done.
Awesome idea...glad it worked on tbis family's favor
make all conventional loans (temporarily) assumable for first time home buyers.
the average person now buys the type of home a factory owner would have lived in in the 1950s
Only 7%? My dad's last house purchased in 1982 had a 13% I terest rate. My house purchased in 95 was 7%. Y'all are soft
Right. In theory, you can just buy the mortgage from the previous owners.
Given that they have a favorable interest rate and still have considerable amount of principal in that loan, it makes financial sense.
I love that for them ❤️ God bless!
Nice that dude is worth hiring. He knows his stuff
Smart idea!
Strange market where everyone is locked in place and nobody is willing to sell. Government lowered rates during covid and artificially distorted the market. Prices went up and never came down. Then rates were jacked up. Price needs to come down as rates go up. Something has to give.
Knew about this about 3 years ago or so..
I believe the seller of the assumable mortgage is still somehow liable if the buyer fails to pay. So, good luck to those trying to find a seller who will be liable for a property they already sold.
Great. Hope that banks do not come out something to prohibit it in the future.
Nah there has to be a loop hole
what do you think the loop hole is?
I think it is you have to pay the equity the house has up front. So you would need to have some cash saved.
Not loop holes per se, but it is limited.
You have to be able to pay up front for the equity the homeowner has already built up instead of a down payment per se.
So if they have $300k in equity, you need to have $300k to start. You are taking over their loan, which means you have to pay for what they have already paid. As a result, this generally only works well for a new buyer if it is a somewhat recent purchase for the current owner. In this case, it was apparently only a few years (just before the rates started going up).
You need it to be far enough back that the rate is much better, but not so far back that there is a LOT of equity and the upfront cost is too high...
The other tricky part is, you need to qualify for their loan. So it is up to the bank who currently holds the mortgage to qualify you to assume it.
And as they mentioned, most loans are NOT assumable, so this type of opportunity won't happen very often.
But as a new homebuyer, you should definitely be seeing whether or not it is an option...
Unlikely, but if there and you can afford it, it could save a huge amount.
No loophole just gotta have a ton of cash
Thanks for telling everyone lol
Good ole Johnny sins is a real estate agent now
Assumable loans have been around for ages
Something to know is that the seller is still on the hook if the buyer defaults. Also, I know for VA sellers, they will not have their entitlement restored unless they sell to another VA buyer. Meaning, they can’t use the VA loan on their next purchase in most cases to non VA people. So good luck getting a seller to agree to that.
You basically have to get lucky if the previous owner hasn't put that much equity into the home otherwise, you'll be paying more overall even with the 3%+ rate.
You assume a low mortgage but you got to get a second mortgage to cover the difference in the equity/listing price. Now you have two mortgage 🤔
The problem isn't rates (which are normal, by historical standards), but prices. Housing is about 40% overvalued, using median income and median price data.
You heard that right. Now I can get away with being Delinquent on my Mortgage by just passing the Debt onto you before the Real Estate dramatically Deprecates in value.
Waiting for the banks to lobby to stop this.
So what happens if the new owner defaults because he is she is out of work for say 6-9 mths ?
The old owner got their equity back and is off the hook?
This works if old owner did not have large equity in house because the new owner has to give old owner cash for that equity .
If old owner had large equity , chances are young couple don’t have that kind of capital to pay the old owner .
75% mortgages out there not eligible for this set up said newscaster . It’s not going to be easy to find a match of buyer, seller and banks would are doing their due diligence on the deal.
Lots more legal work to be done and higher closing costs.
Due on sale clause. This exists in 99% of loans
This is the only way I’d buy house today
Houses were made for banks, not families
"till that mortgage rate goes up"? what do you mean? mortgages dont change
She's probably speaking on a fluctuating mortgage. 3,2,1 is perhaps what's she is mentioning I assume.
One of the few realtors to get paid their worth
Buy in cash
Interest rates are NOT out of control. If you compare historically, they are about where they always have been. It's just that they have been so low for so long, many young people haven't seen rates this high so they think they are out of control. In the late 70s and early 80s they were like 15% so 7% is pretty normal.
The big difference is houses today cost more than double what they did back then when adjusted for inflation. Houses were more affordable with a 15% interest rate back then versus a 7% interest rate now.
Combined with purchase price it is out of control
This is supposed to be something every realtor should know. These ditsy realtors that just show houses are clowns.
They had to move to Florida for work?? What work??
This is a nightmare waiting to explode!!!
In nj good luck buying this
Realtors are typically completely useless, but that Re/Max realtor is an _exception_ as he facilitated the assumable mortgage and is actually doing work. Congrats!
dont forget to tell them that if they default on the loan the original borrower is still liable.....
Not true, it’s similar to normal housing process. The buyer just needs to payoff the existing equity and closing cost. The vested owner will not be on the deed or mortgage and new buyer is now on the loan.
All is it the buyer gets the house at the equity % and the interest rate. It’s a good deal if your able to find a property and the owner is willing to do an assumption loan.
@@Inyuasha824 its 100% true dude dont belive me go talk to a lender. The seller can still be responsible for the debt, even after the buyer assumes the loan, if the lender does not release the original borrower
Funny how these same people didn't go out and buy a home when interest rates were 3%. Oh right, the over bidding was insane. 😆
Just buy it with cash... No mortgage, or death loan, that way.
Well, just because this is amazing for a while, I'm still concerned something will scam them in the end. 3% is only good if it last for 30 years. This might last for a year or two, then they will get pig butchered by the bank.
Greetings 👋🏼 from the simpler life where property taxes are less than $500 per year on ocean 🌊 front property
Genius.
There is also seller financing where the seller themselves act as the bank.
Risky move if your buyer defaults on the loan?
@@xbirdsofparadiseyou get the house back
That works if the seller does not have a mortgage. That was not the case here.
I would look for recently flipped properties bought in 2020 (with the right loan of course) and little to no equity built in the property. The key is a great realtor to find these properties.
You know if this a thing in the next couple years the market finna collapse hard.
ESBM
Youre mortgage oayment only goes up if its not fixed. Why wouldnt you get a fixed mortgage?
It is fixed. It’s a government loan they are assuming.