Mortgage Matters

Wesley Knight 0:00
This is a kunv 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.

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, company. NMLS number is 42056, joining me, as always, is my co host, Heidi Griffith, and together, we help families achieve their financial dreams and build generational wealth through real estate and Finance. Good morning. Heidi, good

Heidi Griffith 1:13
morning. Roland, how are you happy? Sunday.

Roland Daniels 1:16
I am doing awesome, wonderful. I

Heidi Griffith 1:19
am. Heidi Griffith, a mortgage advisor and your Director of Client Services, also with Geneva financial. My NMLS number is 2247754, it was a great week, wasn't it?

Roland Daniels 1:32
It was. The weather is cooling down a little bit. Yeah, I

Heidi Griffith 1:35
think it's supposed to get warm again this upcoming week, but we shall see. We had the Feds that met last Wednesday, right? Oh, we did interesting stuff. So what do you think?

Roland Daniels 1:46
Well, it was projected anywhere between a quarter and a half a percent, but we got the half a percent reduction did. That's

Heidi Griffith 1:55
pretty awesome, right? So I know that that's a little confusing, because our phones literally have been blowing up since Wednesday morning, since Jerome Powell spoke, because everyone has been under the impression that, because the Feds lowered rates, mortgage rates were instantaneously going to go lower. That's not the case, right? We actually saw some increase. We

Roland Daniels 2:17
did. We saw a slight increase, actually starting on Tuesday, Wednesday, Thursday, and getting a little break on Friday.

Heidi Griffith 2:27
Yeah, yeah. So, so, how does that work? Why, when Jerome Powell came out and said that REITs had been cut by point five, why did we see a bump in mortgage rates and nothing crazy. I mean, we didn't go up crazy, but it was pricing was worse on Wednesday, Thursday, Friday than it was on Monday and Tuesday. Yes,

Roland Daniels 2:51
because it was the anticipation of Powell, they didn't know exactly what he was going to say, whether he was going to reduce interest rates by a quarter or a half. So most of the time, those interest rates are already built into the market. So of course, if it was a 25 basis point reduction, or 25 quarter of a percent, there was a lot of confusion in the market, uncertainty in the market. The markets do not like uncertainty, right,

Heidi Griffith 3:27
right? And on top of that, mortgage rates are not really directly tied to that rate, right?

Roland Daniels 3:34
No, they're not. Usually, when it comes to the rates, they are tied to Treasury yields and what's going on in our economy, right, right?

Heidi Griffith 3:42
And that's mortgage so when we, when we said we were getting that half a point or, you know, point 5% cut, that's really going to affect credit card interest rates, credit

Roland Daniels 3:55
cards, car loans, installment loans, student loans, right, right? So

Heidi Griffith 4:01
great for everyone, and typically, mortgage rates then follow, right? Yes,

Roland Daniels 4:06
right. So it may be a week or two before we actually see those rates hit our rate sheets,

Heidi Griffith 4:14
right? And the anticipation what we're looking for, and what he's kind of told us he's going to do is continue to make these small cuts through the end of the year. Yes,

Roland Daniels 4:26
the Fed usually meets around eight times every year. I think we have two more actually. So we have another meeting scheduled right after the election. I think it's coming up on the seventh of November, and there's a chance, depending on what goes on on the market between now and then, that there may be another decrease in rates, right?

Heidi Griffith 4:49
So that's great news for all things interest rate related, and we hope that we're going to see that on the mortgage. End of things, we're fairly certain unless something. Think strange happens, and strange things have been known to happen, haven't they, of course, but, but so yeah, so we anticipate some stuff. It'll be interesting to see where, once the dust settles, where everything falls, what I will tell you. And you know, our phones have been ringing, and not just because of interest rates, but just because of interest in purchasing homes and real estate, our phones have been ringing more than they've been ringing in the past, and I only bring that up because you and I have had a lot of conversations about this for the past several years. As interest rates rose, we took the opportunity to work with folks who might not have had the advantage of getting into a home when things were crazy and covid things were crazy, people were lining up for homes. They were offering above list price. They were waiving appraisal and coming in above whatever the appraisal was with their own funds. So we took the advantage of getting folks who didn't have the money to come in above whatever that looked like, and really focused on first time homebuyers and down payment assistance, right? So yeah, and and with that, as we teach classes and as we speak to people for the past several years, we've kind of instilled that this isn't going to last forever. We're not going to be able to be able to get seller credits forever, right, because when interest rates do whatever they do, and people say, Okay, it's time to go buy a house. Now, we don't have a lot of inventory. And I, you know, I can't see, maybe my crystal ball broke again, but I can't see people flooding the market with listings. We don't have a lot of homes already. I think we're under 8000 homes in a city with, you know, a valley with a population of nearly 3 million people. As more people come back into the market and want to purchase homes, that's going to limit those seller credits, and that's going to limit all of those tools we've been utilizing for the past couple of years. So it'll be interesting to see how it falls. Yes,

Roland Daniels 7:07
so people are still holding on to those low interest rate mortgages from the three and 4% from what occurred during the pandemic? Yep, sometimes two and a half. That's right, and if they move, they would have to trade in those low two and a half 3% interest rates, and it could be possibly five, five and a half or 6% during these times, which makes them think twice about listing in their homes or selling their homes and moving up to a larger home, or downgrading,

Heidi Griffith 7:40
yeah, because they've got that rate, and I gotta tell you, I think twice as well, good time for a lot of people to make a move. It'll be interesting to see how it all plays out, how it all shakes out. We'll keep everybody updated, but I tell you, I would be paying attention to this because it doesn't only affect home purchases. It doesn't only affect what's happening in the real estate market, but it really is going to affect what happens in the country

Roland Daniels 8:07
and our entire economy, right, right, including what's going on right here in Clark County. Oh,

Heidi Griffith 8:13
well, that's where it starts, right? Is it starts right at home, right? So, yeah, so that's interesting. We'll keep an eye on that. I just want to mention again, we've got an upcoming health and housing fair that's going to be on Saturday, October 5, 2024 I love when this is through CPLC, that is the nonprofit that we actually teach our HUD certified Freddie Mac smart class with, typically The first of every the first Saturday of every month. We're going to skip that class this month because of this event, and it's going to be held alongside CPLC, CSN, v nhssn. I mean, there's a bunch of people that are sponsoring this. Nevada Partners is part of this event, and it's going to be fun. They're going to have resource vendors. So folks like us will be there with information in both the housing and the health spectrum. There's going to be music, there's going to be entertainment. I believe they're going to have some food trucks. They're also going to have free health screenings. They're going to have free HIV testing, and they will have free covid and flu vaccines, they are also going to be registering people

Roland Daniels 9:24
to vote. Yes, please get out to vote. Absolutely. This

Heidi Griffith 9:29
is a year that it's very important and your vote is important.

Roland Daniels 9:33
Your vote matters. Every vote matters. Yes

Heidi Griffith 9:36
it does. Yes it does. So if you're interested in learning more about this health and housing fair, or if you have any upcoming event questions, you can reach us at 702-210-2057, again, that number is 702-210-2057,

okay, so moving along. So last week. You had kind of put it out there into the universe about getting a Question of the Week series going, and we actually had several people reach out. So thank you to those of you that reached out again. If you have any questions that you might want to hear the answer to on air, you're more than welcome to reach out to us, and we will get that question answered either in person or on air. And this week's question was a really good one. It reads, my sister is a teacher here in Las Vegas and wants to buy a home. Are there any programs that help teachers? And that's from Audra. She lives in Las Vegas, so she's asking if there's any programs that will help her sister, who's a teacher purchase a home. And there is, right, of course, there is absolutely. We actually have a great program. It's through Nevada housing. It is called home as possible, or hip, for short, for teachers, and it's a great program. We've actually got several teachers into homes. I know that Nevada housing, they put this program together because we have such a need for public K through 12 teachers in the valley, and this is one of those little incentives to bring them into the city, get them teaching our kids, and give them a perk for doing so, right, of course,

Roland Daniels 11:19
And one of the main questions, even when they call in for the teachers program, can you tell us, is there income limit for teachers?

Heidi Griffith 11:27
The income limit for teachers is $160,000 and I got to tell you, unfortunately, most teachers don't make 160 but if you're a two person household and you've got a spouse or a partner, that number combined 160 so we can qualify for this program up to 160 and I believe Roland tell me, if I'm wrong, I think the maximum purchase price that you can get on that is $766,000

Roland Daniels 11:53
give or take. Yes, it is actually. It's $766,550

Heidi Griffith 12:00
and could you potentially have a co signer on this program? Of course, yep, yep. And the minimum FICO for this teacher program is 640 if you're going to do a manufactured property, the minimum FICO for that is 680 we don't like to drive things with FICO scores, because life happens. And you could have a 632 and say, Oh, I don't qualify. Well, gosh, if you have a 632 it's going to be pretty easy to get you to 640 in most instances. So don't let that stop you.

Roland Daniels 12:32
Don't let your low credit score stop you from purchasing a home, or stop the process of starting to look at a home move forward. We stress that every day that you need to make a decision and decide that you actually want to purchase a home and stop renting Absolutely.

Heidi Griffith 12:51
That's and you really, you talk about that a lot in in the first time homebuyers class, and really, that is the first step is to believe in yourself and believe that you absolutely can. It might take some work. You might have to do some things, but if you're willing to put in the work, you're going to find people that are willing to put in the work with you, and you can be a homeowner. But this program, it's awesome. It's for teachers, like we said, it is for Clark County School District teachers. So they've got to work for the school district. This doesn't work for private schools, but I believe it works for

Roland Daniels 13:28
public charter schools. You have to be a full time classroom teacher, right? So

Heidi Griffith 13:34
it's going to be public, it's going to be charter, and I believe magnet schools as well. So you've got to be a teacher. So it's not, it's not this program isn't for school district employees, so you've got to be a teacher. K through 12 in the Clark County School District, we actually closed one just it's going to be a couple months now that we closed her. I It's a great story. She's She's young. She recently graduated from UNLV. She graduated with her teaching degree, she had worked at the school district while she was finalizing her degree, and she actually worked a second job she got qualified prior to getting all of her certifications right, so that she knew she was ready to go the beginning of it was this school year. The beginning of this school year. Yes, this is a great story. She got into her first home after we looked at everything, because we looked at a bunch of different options for her. But after we looked at everything, the teacher program worked best for her. She got $7,500 towards her down payment. She had saved money because she she was hustling. She was out there doing the most, and she saved up a lot of money. She got seller credits. She got the $7,500

Roland Daniels 14:48
how much for DPA, or the down payment assistance. She

Heidi Griffith 14:51
got $7,500 for the teacher DPA.

Roland Daniels 14:53
That is awesome. And does she have to pay it back?

Heidi Griffith 14:55
That's that's the best thing. This is right now. With the Nevada housing division, the best program, right? Because she gets $7,500 and as long as she lives in the property for five years, it is forgiven. So after she lives in the property for five years, there is no repayment. It's free money at the end of five

Roland Daniels 15:19
years. But what happens if she decides that she wants to move in three years? That is

Heidi Griffith 15:24
a great question. If she decides she wants to move and or refinance, because right now we're talking about refinancing and rates that $7,500 is prorated every single month. And so if, let's just say, year two, she decides she has to move for whatever reason, it's prorated, and then she would just have the five years remaining on that balance.

Roland Daniels 15:46
So the calculation goes something like this. It's 7500 DPA, and it's over 60 months, which is about $125 a month. So if you're in there for, say, 10 months, then that's 12 150 bucks. That's off of that $7,500 just like Heidi was saying, it is prorated, and you're not responsible for paying the entire $7,500 back if you're in there less than five years. And remember, this is a second which is silent, so there's no interest accruing, and then there are no second payment either if

Heidi Griffith 16:28
you, or someone you know is a Clark County School District teacher, because it's $7,500 towards closing costs. I mean, as long as you make under 160,000 actually, you can make up to 160,000 This is a program that I think our teachers deserve to take advantage of. They are the unsung,

Roland Daniels 16:50
and don't forget, there is also a reduced interest rate associated with the teachers DPA program. There is that was designed for teachers, to keep teachers here in Nevada as a way to help them with the cost of getting into a home. We want them to live here. I agree.

Heidi Griffith 17:08
And and do we have to be a first time homebuyer to qualify for this?

Roland Daniels 17:13
You do not have to be a first time homebuyer. That is one, one of the criteria when it comes to this program.

Heidi Griffith 17:20
Yep. And if you, if you, let's just say you were relocating from another state and you owned a property there, the only criteria with that is that you would have to sell your property before you closed on this property to receive the $7,500 you

Roland Daniels 17:33
cannot own another property at the time of closing.

Heidi Griffith 17:35
Yep, yep. And so in, in line with that. I just want to go back, because we are talking about a down payment assistance program for teachers. We actually have our upcoming all about Down Payment Assistance class that will cover all of the 16 programs that we offer. And that class is going to be on Monday evening. That's october 14, from six to 730 we like to we typically do one weekend class a month, and this is online. We try and throw at least one, if not a couple, throughout the week in for those of you who might be working during the weekend and or you know you'd like to do things in the evening better. So this class is from six to 730 it really is a great class. It covers pretty much everything about down payment assistance. We answer all of the questions we receive. We talk about different myths that surround down payment assistance, the availability of down payment assistance. We talk about, again, the programs that are offered for down payment assistance, including wish funds, and it really is a class to pay attention to. If you're thinking about utilizing down payment assistance to purchase a home.

Roland Daniels 18:49
We break it down, we do. We do. So please tune in if you can register for that class. Like she said on October the 14th, the class usually is about an hour or so, and we leave 1520 minutes for questions. We do.

Heidi Griffith 19:03
We do. So we have it scheduled on Eventbrite from six to 730 but it usually takes us about an hour to get through the class. And then there's, I don't think we've had a class that we didn't have a bunch of questions at the end. So it's usually about an hour and a half if you want to stick around. So if you're curious about the upcoming events that we have. You can actually find us on Facebook and Instagram. You'll see roland's face. It is Las Vegas, mortgage Pro. That's where you'll go to find us on social. If you have any questions, you want to register for any upcoming classes, or if you'd like to leave a question for the week, you can call or text us at 702-210-2057, again, that number is 702-210-2057,

you know, I want to circle back because I mentioned credit earlier, but we do get a lot of calls about credit, and people are always concerned. That their credit isn't good enough. And you know, what does that look like? And and they want to have great credit, or perfect credit. And I got to tell you, what's the highest FICO score you could have? Roland, 858 50 is the highest. How many times have you seen 850

Roland Daniels 20:15
I've only seen it twice in my career over the last 18 years, right?

Heidi Griffith 20:20
So, and that's, that's perfect. That's, that's a hard number to achieve if you've already achieved that. Good job, hats. I mean, that's the perfect credit mix. So you've got different types of credit, you've got installment payments, you've got revolving payments. But it's not necessary. You know, having an 850 is not a necessary thing. Having Good Credit is a necessary thing. But good credit means different things to different people, like we mentioned. You know, for the down payment assistance programs that we talk about, the minimum credit score is 640 however, for an FHA loan, for a conventional loan, for a VA loan, for a USDA loan, they all have different credit requirements, and I got to tell you, none of them are 640 roll it. What's the minimum credit score for an FHA loan?

Roland Daniels 21:14
The minimum credit score for an FHA loan is 580 but you have to put down three and a half percent. Right for 580, for 580, scores are between 505 79 you need 10%

Heidi Griffith 21:30
down. But so what you're telling me is that you could actually get a mortgage with a 500 credit score. You've just got to put 10% down. Now keep in mind, when we talk about yes, you can get a credit you can get a mortgage with a credit score of 500 there's other factors that come into play. It doesn't mean you automatically qualify when you have a 500 FICO, however you FHA is as low as 505 80 is kind of that sweet spot where you can utilize just three and a half percent down, right? Yes. And what about conventional financing? For

Roland Daniels 22:02
conventional financing, you know that you do need a minimum score of 620 right?

Heidi Griffith 22:06
And that's for 5% down. That's for any conventional loan. You need a 620

Roland Daniels 22:10
Yes, they'll go as low as 3% down for a conventional loan, and that's

Heidi Griffith 22:15
usually a first time homebuyer, yes, product, right, right? So this is the fun one. This is the fun one. First and foremost, if you or a if you are a veteran and or you know a veteran, or if you're active duty, thank you. But what about VA loans? What's the minimum FICO for a VA loan? Well,

Roland Daniels 22:36
according to the Veterans Administration, the VA loan or veterans, there are no FICO score requirements.

Heidi Griffith 22:44
So there's no credit score requirement from the guidelines, from

Roland Daniels 22:48
the guidelines from the VA, but most lenders will have a score associated, or a minimum FICO score associated with a VA loan,

Heidi Griffith 22:57
right? We call those overlays, right? Yes. We call those overlays. So realistically, you want to have about a 580 when you start looking for a mortgage. However, that doesn't mean don't reach out to someone to start the process, because you want to know if, in fact, you're not at 580 what to do and what not to do, because a lot of times we go out there blind, we say, Oh, I just have to pay everything off, or or I'm going to make payments. And that isn't always necessarily the case. Medical medical is a big one that we talk about. We have this conversation all the time with people. People do have medical collections. In many instances, how does that impact your

Roland Daniels 23:38
credit report? So when it comes to medical collections as a lender, we don't even look at the medical collections anymore, so please do not go out and pay off collections or charge offs before speaking to a professional. Absolutely. Because sometimes, if you make those payments, it reactivate those trade lines and they become current all over again, hitting your FICO score again, which in turn, will lower your FICO score. You may think that you're making these payments and paying debts off, trying to increase your FICO score, but it can have a negative impact on your FICO score. That's

Heidi Griffith 24:19
right, it's all about timing. It's all about, you know, keeping that clock stalled and not restarting it. Get the advice that you need and get good advice. But there are, you know, there's some really easy ways that you can start working on credit. Now, if you feel like you know, your credit's not exactly where you need or want it to be the first rule of thumb with anything credit,

Roland Daniels 24:43
please pay your bills. That's it. Every month, every single month,

Heidi Griffith 24:50
yeah, that is the number one factor when it comes to keeping and building your credit. That's the top of the. That's the top of the list. What percentage of your credit score is from just paying your bills on time rolling, that

Roland Daniels 25:05
is 35% of your FICO score. It's the biggest chunk. It is the biggest chunk. It's just one late payment on a 30 day will count anywhere from 60 to 140 points against your FICO score. Yeah,

Heidi Griffith 25:20
it's crazy. It's crazy. So you that's the first thing that you want to do is make sure you make your payments on time. The second thing that you want to do is keep your credit utilization under 30% right?

Roland Daniels 25:31
That is correct, and that is 30% of your score. So

Heidi Griffith 25:35
you've got 35% and 30% that's a big chunk of your credit score. So pay your bills on time credit utilization. Let's kind of explain how that works. So you've got, let's just say you have four credit cards. You've got four credit cards. Some have high balances, some have lower balances. What does that look like when we're trying to fine tune our credit and some could be maxed out, yeah, in many instances. So yes. So how do we, how do we work with that, and how do we start to improve that with our credit

Roland Daniels 26:04
so just say we have a credit card and it's a $500 balance, we want to keep it at 30% or below, right? So we just multiply that by 30% which is $150 we want to keep that credit card balance at $150

Heidi Griffith 26:20
or below or less, or less or lower, the better. But life happens. We understand that. So you want to make sure you pay your bills on time, keep the credit utilization below 30% and this is kind of the magic trick that really has helped a lot of people that a lot of people don't know about. So I'm going to tell you, become an authorized user on someone's account or accounts, and what that looks like is, Mom has great credit, or a friend, or, you know, your spouse has great credit, and they've got a credit card or several credit cards that have low utilization, right? They're under the 30% you were talking about, right? Roland, yep, they're under the 30% that Roland was talking about. You ask them to if they'll allow you to become an authorized user, they will start that process. You don't even have to have a credit card. You don't have to use their credit it's basically just your name on their account, and you can piggyback off of their good credit. We actually had someone who her credit score. I want to say it was high fives. 585, 85 somewhere in there. Her fiance had excellent credit. His credit was high sevens. He had several cards that had low balances on them. He put her name on the card. She didn't get a physical copy. He put her name on the card. Her score jumped 60 points in 30 days. I mean, now she's, you know, she's up in the sixes, and they are thinking about purchasing a home. So it's a great start. But with that, that doesn't work for every single person. This is one scenario. However, it will help you. Yes, so if you want to be added, you got to have that conversation, because a lot of people who get approached with this think that you're going to destroy their credit. We get this question a lot too. So Roland, we've had this question in class. We actually had it last week. If I put you

Roland Daniels 28:24
on my account, credit is 530 okay,

Heidi Griffith 28:29
if I, if I take you with your 530 and put you on to my 780 FICO score account, you're going to make my credit bad. Yes, that

Roland Daniels 28:39
is one of the questions that's been asked for the last few weeks, but

Heidi Griffith 28:43
that's not true. That's not true at all. That's not true. It won't affect your credit at all. If you put someone on your account as an authorized user, and you can always remove them as an authorized user if whatever reason, things don't work out the way you want them to. So that's a great tip. Those are just quick, easy credit tips. Again, if there are any questions, you're always welcome to reach out. We're at 702-210-2057, again, that number is 702-210-2057,

Roland Daniels 29:16
and we in today's show. Remember what Winston Churchill said, the pessimist sees difficulty in every opportunity. The optimist sees opportunity in every difficulty. Oh,

Heidi Griffith 29:30
thank you so much. That's awesome. Thanks for tuning in to mortgage matters. We'll be back next Sunday at 730 right here on kunv 91.5 Have a good weekend.

Music 29:41
You.