Mortgage Matters

Wesley Knight 0:00
This is a KU NB studios original program. The content of this program does not reflect the views or opinions of 91.5 jazz and more the University of Nevada, Las Vegas, or the Board of Regents of the Nevada System of Higher Education to

Roland Daniels 0:43
Good Morning Las Vegas. Welcome to mortgage matters. I'm Roland Daniels, a certified mortgage advisor with Geneva financial. My NMLS number is 355859, our company, NMLS number is 42056, and I'm here this morning, as always, with my fantastic co host, Heidi Griffith, good morning. Heidi, well, good morning. Roland, how are you? I am doing awesome. Happy Sunday. Happy Sunday. I'm Heidi

Heidi Griffith 1:12
Griffith. I'm also a mortgage advisor and your Director of Client Services. My MLS NUMBER is 2247754,

Roland Daniels 1:21
we are digging into something that has been making a lot of noise lately, especially if you've seen the headlines about what's called Vantage score, it is getting the green light for mortgage lending right. There's plenty of talk out there, but not a lot of clarity. So we're here to break it all down, what the changes actually mean, and what the timeline looks like, and what credit scores still mean for you right now,

Heidi Griffith 1:51
yeah, and even if you're not ready to buy a home right now, today's show is for you. It is. We're going to talk through real steps to get prepared common misconceptions we hear all the time, and what you can do now, instead of sitting on the sidelines waiting for things to change, huh?

Roland Daniels 2:07
That is right, and we're also talk, we will also talk about our upcoming path to homeownership workshop on Saturday, August the second, and it's completely free, and if you've even thinking about buying your want to be there.

Heidi Griffith 2:23
You will, you will. So if you have any questions or you want to register for any upcoming workshops or classes we have, you're more than welcome to give us a call or text us. We're at 702-210-2057 again, that number is 702-210-2057 you can also find the link to all of our upcoming events on our Facebook page. That's mortgage matters radio. Heidi,

Roland Daniels 2:48
yes. Let's start with the headline. VantageScore 4.0 has it been approved for use in the mortgage lending space? That

Heidi Griffith 2:58
is the headline, isn't it? It is. We're seeing it a lot. We are in our circles. People are talking about it. So what is it? I don't think it really tells this whole story yet, right? It doesn't. So this decision came from the Federal Housing Finance Agency. That's the government agency that oversees Fannie Mae and Freddie Mac their director. His name is Bill Pulte. He made a public announcement on social media saying lenders can now use VantageScore 4.0 so the Vantage score 4.0 without needing to change any infrastructure. So VantageScore 4.0 that's a new model. Vantage score. You might be Yeah. You might be familiar with the Vantage score. Places like credit, karma, credit, sesame, they use Vantage versus FICO, they do,

Roland Daniels 3:43
and here's some background on them. Pulte is the grandson of the founder of Pulte Homes, one of the largest home builders in the country. His experience and focus tend to lean towards the housing market builders and investments, not necessarily the needs of individual home

Heidi Griffith 4:04
buyers. That's right. That's right. So in his post, he also tied the decision to what he called President Trump's landslide Man Date to lower cost. So this just wasn't an industry update, right? It wasn't, I feel like it might have been just a little bit of a political signal. It got a lot of attention, especially from people who already felt locked out of the market. A lot of people are calling us on it,

Roland Daniels 4:26
right? They are. And listen, we are 100% behind giving people more access and better tools. We are VantageScore 4.0 is designed to factor in things like your rent, utility payment, which can help borrowers with thin credit histories, especially renters, younger buyers and underserved communities. This could actually be an awesome change for the better if they do the right thing.

Heidi Griffith 4:56
It can I agree with you, 100% um. In theory, it sounds really good, right? It does, right? But, but here's the truth. We've had people that saw the headlines. They've called us. They're like, Oh, you're using Vantage and my, you know, my Credit Karma score is whatever that looks like, right? Um, here, here's the truth. It's not ready. It's not in place. Just because it's been approved doesn't mean it's usable today. Systems still need to be updated. Policies, you know, they need to be written by each individual company, right? And lenders, mortgage insurance, software vendors, I don't know, just everybody involved. They're all going to have to make this work behind the scenes, and that's going to take months, at a minimum.

Roland Daniels 5:36
We are hearing anywhere from six months to a year, yeah,

Heidi Griffith 5:40
it's going to be interesting to see how it plays out if it

Roland Daniels 5:43
does happen, right? So if you've been asking yourself, Would it be better to wait for Vantage scores to become the mortgage norm? Ask this, what would you actually gain by waiting? You delay your goals, miss out on today's opportunities and stay stuck in a no decision loop? It's an important question and worth asking, even if the answer is surprising,

Heidi Griffith 6:12
I agree. I agree, and so meanwhile, here's what we actually use right now when we evaluate credit for a mortgage, right we use a try merge credit report, and that means that we're pulling from all three bureaus. So you've got Experian, you've got Equifax, and you've got TransUnion, we get all three of those scores, and we actually use the middle score. So if you had a 700 709 and 720 we're going to use that 709 right? What if

Roland Daniels 6:44
I'm applying with my brother and my middle score is, say 600 Well, what's your brother's middle score? My brother's middle score is, let's say 650 Okay, so you've got a middle

Heidi Griffith 6:57
score of 600 you've got a middle score of 650 if there's more than one borrower, we're going to go with the lowest middle score between all borrowers. So regardless of how many people are on the loan, we're going to use the lowest middle score. It's not average. Somebody asked us that in our last class, is it average? Nothing's average. We take the three different scores, we use the lowest middle score of the group.

Roland Daniels 7:21
So for credit scoring purposes, what do we use in today's

Heidi Griffith 7:24
world? We use the FICO. We do? We use the FICO? Yes, there are

Roland Daniels 7:28
a few lenders who do Vantage in some of the banks out there and some of the smaller credit unions, I think. But we'll keep everybody informed. And here's where get specific. The VA technically does had, doesn't have a required minimum score zero, right? Yep. But most lenders have what's called an overlay. They do, right? For our overlay for Geneva financial is a 580 so you've

Heidi Griffith 7:56
got to have a minimum of a 580 to get a VA loan, which

Roland Daniels 8:01
score, okay, and here's where it gets specific. The VA technically does not have a required minimum

Heidi Griffith 8:08
FICO score. Hang on, so there's no required

Roland Daniels 8:11
per the VA guidelines, there is no minimum FICO score with the VA loan. That's interesting, but most lenders have what's called an overlay with Geneva financial. Our overlay is a 580 so you need a 580 middle score to be eligible for a VA loan.

Heidi Griffith 8:30
So if one of my scores was 560 my middle score was we'll call it 581 and then my high score was 600 we could still then move forward.

Roland Daniels 8:39
581 moves us forward, perfect, right? And then when it comes to the FHA, we start at 580 that is our overlay for FHA loans, and that will allow you the ability to put the minimum down payment of three and a half percent if your credit is between a 500 and a 579 you can still get an FHA loan. You just have to put 10% down, because it's all based upon risk. So

Heidi Griffith 9:11
you could get an FHA loan at a credit score of 520 you just have to put 10% down.

Roland Daniels 9:17
You can, okay, yep. And up next is conventional loans, right? The minimum required FICO score is a 620 across the board, so it's a little higher with a little bit

Heidi Griffith 9:29
higher, right? Yep. What about down payment assistance programs?

Roland Daniels 9:32
When it comes to down payment assistance, especially with the state of Nevada, such as Nevada housing division, Nevada Rural Housing, those programs require a minimum middle FICO score of 640 That is correct, right? We do have some other down payment assistance programs that we can go as little as 600

Heidi Griffith 9:53
so you could have a 600 minimum FICO, excuse me, median FICO, right? And still quite. Qualify for some assistance programs you can so if you're sitting at home thinking, I'm not ready yet, please hear this. Don't assume that you're too far off. We've worked with people who thought they needed months or years or whatever that looked like to improve their score, only to find out they were five or 25 points away from qualifying.

Roland Daniels 10:19
That is correct. And when you've got good guidance and you're willing to put in the work, you'll be amazed. What can happen. We tell people go from almost there to fully qualified within as little as 30 to 90 days, and then that's not unusual.

Heidi Griffith 10:36
No, no, we see it all the time, don't we? We do and here's where we do things a little differently, right? Because a lot of lenders will say, you know, your credit score isn't where it needs to be to qualify for this loan. Let's just say you only wanted to put three and a half percent down on an FHA, and you came in with a, I don't know, 550 Right, right? And a lot of times they'll say, you know, when you fix your credit, when your credits up to where it needs to be, come back and talk to me. Yes, they'll just leave you Well, yeah, you know, they've got other things to do. Just come back and talk to me. You know, maybe they're gonna give you a list of things to try. Maybe you have to, you know, pay off this credit card, or you've got to contact this, you know, this debt collection and try and work out a deal with them and get it removed from your credit report. Or you got to pay your car down, whatever that looks like. They may give you some, you know, some ideas on what to do, right? But then that's it. So you're going to have to figure it out, figure out, hoping that your credit report where your credits, where it's supposed to be at that point, then you maybe call them right? But I really believe that you and I, both you know, are firm believers in walking alongside our clients the entire process. You know, whether it's a 30 day process or whether it's a three year process, because we've done it right? We've worked with clients for three years, probably longer, but yeah, absolutely. So my my thought is this, if you're ready to show up and do the work, we're going to show up and do the work right beside you. We're gonna be there for every step of the process,

Roland Daniels 12:04
because that's what real help looks like, not just telling people what to do, but being available, checking in and making sure that you're not doing it alone. Yeah, because it's scary. It is scary.

Heidi Griffith 12:18
You know, it's potentially the largest investment you're going to make in your lifetime. And you know, I we usually say, you know, if you've never done it before, you don't know what to expect, but quite honestly, you know, people typically don't buy a house a year, right? And so even if you've done it a couple of times, maybe it was 10 or 15 years ago, it can still be scary. It's daunting, it's a lot of money. And things change over time, not even over time. Things change constantly. They do right? So I believe that's why it helps to have real support, not trying to guess and figure out and are we there yet? Aren't we there yet? Maybe we should wait. You know, we work closely with HUD, certified credit counseling agency, CPLC. We do. They offer guidance specifically for future homeowners, and they'll walk through your credit tell you what to focus on and help you build a plan. It's totally free. You just pay the 25 bucks to them. That's what it costs them for a soft credit pull so your your credits not going to get dinged. That's it. So, you know, if it's more than a couple of points to get you up, because we can usually figure out, you know, 1015, 20 points and how to get you there if there's a little bit more work and life happens, right? Yep, then we do utilize, you know, services like CPLC for Credit Counseling. We're not going to send you to someone, you know, that's, I'm doing air quotes right now, a credit repair service that could charge you hundreds, if not 1000s, of dollars, and then we have to hope that your credit is repaired or send you to credit consolidation companies where you've got to miss payments, right? Please stay away from those types, you know. And in some instances, in some people's circumstances, it works if you really do have a very high debt and you're trying to work through that for purchasing home, it's not going to work for purchasing anything that you actually need credit for. It's not going to work because it will destroy your credit, and you will have to completely rebuild your credit, right?

Roland Daniels 14:16
Yes. So whether or not Vantage scores become a tool we use down the road. You don't need to wait. You've got resources. You've got people. And if you're ready to take that first step, we're ready to walk with you. I

Heidi Griffith 14:33
Yeah, we are. We are. So if you have any questions, you can give us a call, or you can send us a text. Our number is 702-210-2057, 22102057, again, that number is 702-210-2057. Wherever you are in the process, we're here to help you move forward we are so one of the most common things we hear from people after they purchase their first home, right? We meet people, oh, I just bought a house. Yeah, I hear it all the time. I wish somebody had just broke down this, you know, to me sooner, maybe help me understand the process, the options and what home ownership actually looks like, even after they moved in. Because it's not just about how to buy a house, but if you've never owned a home before, there's a lot. There is a lot. There's a lot. First of all, you're on your own with maintenance and things like, I mean, just there you're it's a lot. And you know, when you're looking for figuring out what home ownership actually looks like, I think that's the biggest reason that we put together the path to home ownership workshop. I agree with you, yeah, because nobody should be guessing their way into one of the biggest decisions of their life, don't you agree?

Roland Daniels 15:43
I agree 100% with you. So our next workshop is coming up on Saturday, August the second, and we love to see you there. This isn't a sales pitch, it's a real HUD certified class that walks you through what it takes to become a homeowner, from start to finish. And

Heidi Griffith 16:04
listen, it's not just for first time home buyers. If you owned a house before, like I was just talking about, and you're thinking about buying again, or maybe you want to help your kids or your grandkids become homeowners. This class is pretty much for everyone.

Roland Daniels 16:16
It is. We talk about the process step by step, what lenders look for, how down payment programs work, and what it means to be mortgage ready, and how to navigate appraisals, inspections, and even bust myths around income and credit. Yeah,

Heidi Griffith 16:35
there's actually a lot more to the workshop than just what you mentioned. Isn't there? It is. Yeah, you're not just sitting through someone talking at you. It's not lecture style, real questions. Yeah, lots of great. I mean, I think that there hasn't been a class that I've been at and taught that I didn't walk away with new information, right? I agree with you. It's wonderful. Yeah, you're not just sitting there, right? You're going to be able to answer all your questions. Maybe you don't like to answer ask questions. I promise you, there are a lot of questions that get thrown out, and there'll be a lot of light bulb moments in this, right? This is your free thinking space, absolutely, and you're going to leave with real steps, like, you know, you're not just going to go to class and then go, I don't know, what do I do? Do I call this person? No, you're going to leave with action steps. You'll know what programs you might qualify for. You're going to get connected with people are here to help you, and you're going to walk out with your home buyer education certificate that that's actually going to be required for the majority of down payment programs we offer. It could unlock eligibility for up to $40,000 in support, right down payment, how much? Again, up to $40,000 and we feed you. Oh, yes, we do

Roland Daniels 17:50
not just with information, with actual food and snacks, right? And snacks. You love snacks. Yes, the atmosphere is real upbeat and welcoming is designed to be a space where you can ask honest questions and not feel judged.

Heidi Griffith 18:08
Yeah, I mean, I know we've talked to people who came didn't think that they were anywhere near ready, and by the end of the workshop, they actually realized that they were closer than they thought. We actually had someone on the show last week. We did right, and he was in that boat. He didn't think that that was something that was something that he was going to be interested in. Came to the workshop, got a ton of information left, and opened his office immediately. Hey, Shakir, thanks again for coming on. And you know, we've had people that came and needed maybe a little bit longer, right? Yep, and they left with the tools necessary so they knew what their next steps look like.

Roland Daniels 18:45
If you've been stuck, unsure where to start, or even a little bit discouraged, this is your starting line. This is where you stop wondering and start moving.

Heidi Griffith 18:56
Yeah, and we don't leave you after the class. We do. You know, class goodbye. You have us in your corner helping you. You know we're going to help you follow through on whatever your next step looks like, because we're not just teaching we're walking alongside you.

Roland Daniels 19:09
If you want to register, or if you have questions about whether it's right for you, you can give us a call or text us that number is 702-210-2057, 102057 that 702-210-2057, or visit our Facebook page mortgage matters radio, where you can find the links to register for any of our upcoming events. Yeah, so Heidi, let's say you've worked on your credit, gone to the workshop, and you're starting to feel like you're ready, yay. What happens next?

Heidi Griffith 19:48
That's a good question. That's a lot. That's a really good question. Roland, so I think a lot of people assume the next step is the fun step, right? You get to go out shopping. No? Yeah, no. I really believe the real next move is getting pre approved. And I think one of the biggest misconceptions that we see in the mortgage industry is that pre qualification and pre approval are the same.

Roland Daniels 20:12
They are not the same. No, they are not. Because even those those two words sound like they mean the same thing, they absolutely

Heidi Griffith 20:21
don't, they don't, they don't. And you know, there are companies out there that do pre qual, pre qualifications versus pre approvals. I will tell you before we even get started, we only do pre approval, pre approval. So when you're pre qualified, that usually means that you've probably called somebody on the phone. You told them, you know, they asked you your name, your social your date of birth, they asked you how much you make. And maybe you're not even looking at your urine pay stub, and you

Roland Daniels 20:51
could be looking at your net

Heidi Griffith 20:55
just kind of come up. I, you know, I make 80 a year, whatever that looks like. They ask you how much you have in the bank, they ask you how your credit is. Only credits good. You know, again, when we look at credit scores, we're currently right. We're using that try merge from mortgages and they're FICO, and maybe you get Credit Karma. And Credit Karma even FICO eight, even your bank scores aren't going to match identically with the

Roland Daniels 21:19
scores for mortgages. They won't, because there are 1000s of scoring models out there.

Heidi Griffith 21:23
And so, you know, you're talking to this guy on the phone, and he's like, Okay, well, based on this, you're pre qualified for $500,000 um, it's not verified, though, right? It's not official. Um, it's like, saying, I think you could afford this house around this price, but really there's no real commitment on paperwork. It happens a lot it does. It happens a lot

Roland Daniels 21:48
it does. So a true pre approval is different. It is. When you are pre approved, you've actually gone through the steps. You provided the documentation. We pulled your credit, we reviewed your income, your assets, and matched you with different loan options that make sense for your situation. It's a real review, not guesswork,

Heidi Griffith 22:13
no, because we're going to be looking at your bank statements, at your pay stubs, at your w2 for the last two years. Yeah, potentially your tax returns. We're going to be looking through your credit report. We'll ask you questions about your credit report, right? We do, and so I think that's the key, right? Pre approval gives you power. Sellers are going to certainly take you more seriously. They're going to 99.9% of the time require a pre approval letter with an offer, not a pre call letter, but a pre approval letter. And you know your agents gonna be able to advocate for you better, because they know they've spoke with you know, they spoke with us, they spoke with your lender, and we've given them the green light. You know we're good to move forward. And you know you have the clarity about your true buying range, not just a number in your head,

Roland Daniels 23:03
right? And we do use an actual underwriter to get final approval on our pre approvals correct,

Heidi Griffith 23:11
absolutely, absolutely. So your your file, once we collect all of the documentation, we we, you know, run credit, we go over your file with a fine tooth comb, have conversations with you about what you're looking at doing. Your file is submitted to an underwriter, and quite honestly, the underwriter is the person that's going to make the final decision. They're going to give us, you know, a conditional kind of approval that says, you know, we're going to need updated bank statements. We'll need an appraisal, right? An appraisal, all of these types of things, but it sure the heck is a lot better going out shopping for a $500,000 house with a pre approval than it would be with a pre qual and then find out that you don't qualify for that $500,000 house, right? Yes, and

Roland Daniels 23:58
it also protects you from, like you said, that disappointment. It does. We've heard buyers who fall in love with homes only to find out later that, like you said, they can't

Heidi Griffith 24:08
qualify for that. Man, it's happened way too many times that I like to think

Roland Daniels 24:11
about probably every month. Getting pre approved early helps you shop with confidence and avoid surprises, you

Heidi Griffith 24:18
know, and if you're not quite ready yet it's okay. Going through the pre approval process can actually help you figure out what you need to work on, right? It does that way. You're not sitting on the sidelines, guessing you're moving with purpose. I don't know how many times we've heard from people. Well, I was waiting for whatever that is to build my credit up to, you know, save, if

Roland Daniels 24:39
you save enough money up for the down payment,

Heidi Griffith 24:42
and if you're curious about what your you know your situation looks like, it is a great time to sit down with a lending professional and figure out where you are and what you need to do, whether that is credit, whether that is save money, or whether that is hey, maybe it is a good time to buy for me.

Roland Daniels 24:59
So. Whether you're ready to buy now or six months or maybe a year from now, start with the truth. Don't assume. Don't estimate.

Heidi Griffith 25:09
I agree. I agree. And if there's one thing we hope you take away from today's show, it's this, you don't have to have it all figured out to take the first step,

Roland Daniels 25:18
right? We've talked a lot about credit scores, system changes, misinformation out there, and even our upcoming path to home ownership workshop. And through all of it, the message stays the same. Where you are right now can still be the beginning. I

Heidi Griffith 25:39
like that. I like that. So so many people wait, right? They wait for their credit to be perfect. They wait for a better job. They wait until someone tells them they're finally ready. And I believe the truth is, by the time they reach out, they realize they could have started months ago. They could, yeah,

Roland Daniels 25:57
and sometimes they've been focused on the wrong things, such as medical collections, old charge offs, things that aren't even impacting their score the way that they thought. That's why we always say, don't guess. Get guidance. Ask questions. That's how you actually move. Yeah,

Heidi Griffith 26:17
and the help is there. We've got the HUD certified credit counseling agency we work with we've got programs that go down to 600 FICO scores. We've got workshops that hand you a game plan, so whether you're five points or 50 points away, we're not here to tell you come back when you're ready. We're here to help you get ready if you want a real next step, please feel free to join us at our next path to homeownership workshop. That's again on Saturday, August 2. It's free, it's HUD certified, and I believe it's one of the best ways to start to move

Roland Daniels 26:54
forward beyond mortgages and credit. We're all so passionate about keeping our housing system fair for everyone. Everyone right. That's why we support the Silver State Fair Housing Council, a very important local nonprofit working daily to combat housing discrimination right here in Nevada,

Heidi Griffith 27:17
yes, yes. Silver State Fair Housing Council offers everything from training and education, from landlords to just everyday people, right? They help people with complaint filing, and then they've got the extremely important Fair Housing Tester program, which you can join to help spot discriminatory practices right here in our community. They make it easy to get involved, even just by learning more and on a national level, the National Fair Housing Alliance plays a major role. They provide resources. They conduct research and guide policy to protect fair housing across the entire country. By supporting groups like Silver State Fair Housing Council, you're helping advance the mission statewide and nationally. If you'd like to learn more or get involved, please feel free to visit s, s, f, h, c.org, you'll be able to see their upcoming events, their trainings, and how you can stand up for fair housing, because fair housing is a right. Fair Housing is not a privilege.

Roland Daniels 28:20
And of course, if you have any questions about anything in today's show or want to register for our Saturday August the second path to homeownership workshop, you are welcome to reach out anytime you can call or text us. That number is 70221020578, oh, 2057, that's 702-210-2057 we'll be back next Sunday morning at 7:30am right here on K, U, N, V, 91.5, until then, believe in what's possible, even if you've been told that it's out of reach, and Remember, stay true to yourself and your mind. Bye. You.

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