Mortgage Matters

Wesley Knight 0:00
This is a Kun V 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 your host. Roland Daniels, a certified mortgage advisor with Geneva financial. My NMLS number is 355859, company. NMLS number is 42056, and I'm here this morning, as always, with my fantastic co host, Heidi Griffith, good

Heidi Griffith 1:05
morning. Heidi. Well, good morning. Roland, how are you this morning? I am doing fantastic. You're always fantastic. That's right, that's right. I'm Heidi Griffith. I'm also a mortgage advisor and your Director of Client Services. My NMLS number is 2247754, so let's give a quick shout out to our always super awesome engineer. Wes thank you for all that you do to make mortgage matters happen. We're going to introduce our our special guest. He told him he had his own chair. It's going to be Kevin Hickey at home ownership programs manager with Nevada Rural Housing. Really quickly before we get started, I just want to kind of to kind of mention some of our upcoming classes. Right row we do really, April is going to be eight lineup of education classes, workshops. We've got all the stuff in April, don't we? We do, we do. So we start with two Saturdays from, well, actually one Saturday, so two weeks from now, right, right Saturday, April the fifth. Yep, that's the path to home ownership workshop with CPLC. That's the HUD certified class. I really, yeah, it's packed with everything you need to prepare to be a homeowner. So I know that over the past few months, it's been a packed class, hasn't it? It has, and we're seeing a lot of folks who have been in class that have referred the class to friends, to family members, because they got so much value out of it, they

Roland Daniels 2:25
did. And of course, we're seeing some uncertainty in our economy. Yeah, yeah, the time is now. Right. The time is now.

Heidi Griffith 2:35
So in this workshop, we actually cover credit, preparation, budgeting, every single step of the home buyer process, don't we? We

Roland Daniels 2:42
do understanding mortgages, the down payment programs, understanding home ownership, avoiding foreclosure, and mapping out your plan for home ownership. Absolutely.

Heidi Griffith 2:52
And we're going to hear from HUD certified counselors. They go over budgeting, they go over credit. We'll hear from you. I teach the lending portion. It's the lending portion. You talk all about what it looks like to meet with a lender to get pre approved, what kind of documents you're going to need, credit, all of that good stuff. And then you cover the 16 different down payment assistance programs that we actually have available, don't you? We do? You do? I actually go over the real estate portion of that class. We talk about everything from the first time we meet and the buyer's brokerage agreement to going out and looking at properties, putting in offers, inspections, all of the good stuff, A to Z.

Roland Daniels 3:31
And don't forget the property values here in the Las Vegas Valley, and

Heidi Griffith 3:36
the inventory, because the inventory is still low. Yes, it is. The inventory is still low and always, always snacks, always lunch. Yes, snacks and lunch your favorite. I show up for the snacks and lunch every single time. So if you'd like to register, you're more than welcome to give us call or text us. We're at 702-210-2057 again, that number is 702-210-2057 I'm just going to really quickly go over some other classes that we're going to have in April. If you'd like to see our full calendar of events, it will actually be up tomorrow on our Facebook page. That's mortgage matters radio. You can find us on Facebook at mortgage matters radio, which will have the entire calendar of event for April. We're going to have a real estate class that's going to be an online class. So if you're a real estate professional, please, this is a class to jump on find out how down payment programs work, because there is so much misinformation about down payment programs. The first one that I'm hearing on the regular now is that there isn't any money available, that all down payment programs are federally funded, and that has been cut off. That is not true. There will always be monies somewhere. Don't you agree?

Roland Daniels 4:47
I agree, and hopefully we'll have our guests address it as well. That's

Heidi Griffith 4:50
right, because, because Kevin always has the good stuff, he always has the good stuff. So we've got that realtor class, we've got a VA class. We're going to do that online. That for any service members, any veterans that have not ever used their VA loan and don't understand this is a time to find out how utilizing your VA loan benefits you, because no down payment, right? Yep, what else? No monthly mortgage insurance, no mortgage insurance. So we've got those classes coming. I think that by registering, being educated and being informed is possibly the best thing that you can do for yourself, right? Agreed, yeah. So let's get into today's show. Hi Kevin,

Kevin Hickey 5:33
Hello, good morning. Hi, welcome back.

Overlapping Voices 5:35
Thank you. Good morning. So excited to have you. I

Kevin Hickey 5:39
appreciate being here. Thank you. So you've got some pretty exciting news, don't you? We do? Yes. We have talked about launch pad on this program before. Yes, and I'm happy to say that launch pad is back. Our second mission, to help rural Nevadans get into home ownership, oh, and as affordably as possible. Tell us. It's great tell us about this program. So it's back. It provides down payment assistance, as you know, and also closing costs. So I just a quick aside there with the VA loans. You know, if those folks need assistance with their closing costs, they don't need the down payment. They can still take advantage of DPA programs. Let's talk

Heidi Griffith 6:16
about that for just one second. I'm so happy that you brought that up. So if you have a VA loan, you do not there is a zero down with VA loan. It's probably one of the best benefits service members get, like mortgage and like mortgage said, like Roland said, there's no mortgage insurance that's associated to it. But there is closing costs, right? There's closing costs involved. And you can utilize down payment assistance. You

Kevin Hickey 6:39
can use the assistance as closing costs. And you know that'll that'll cover up to 5% depending on which program you choose from. Nevada, rural housing will cover that 5% up to 5% so you're right. The VA loan is a deal. Those service members definitely deserve that and and we're happy just to come in and help even that little bit more with that assistance in the closing costs if they need it. But Launchpad provides, as you know, down payment assistance and closing cost assistance of two or 4% for first time homebuyers, and if you're a repeat borrower, or you could be a first time homebuyer with a higher income, there's also an option for down payment assistance. That's just Launchpad that is 3% and 5% options. So lots of options. This time around, last time it was just 4% only. Now we have between two and five more opportunity, more options. And last time around, two it was just government loans, so FHA VA and USDA. But this time around, we've added the conventional loan options as well, so that gives all the more help and advantage talking about mortgage insurance. Mortgage Insurance folks who qualify for conventional loan and their income is 80% or less of the area median income they qualify for charter level mortgage insurance, which is about half the cost depending of normal mortgage insurance. So it's another opportunity to save significantly when using a program like Nevada Rural housings and so, you know, we focus a lot on the down payment aspect of it and the assistance that you get through the programs, but there's also that opportunity for the lower mortgage insurance. And as you know, I'm sure we'll talk more about it. The Mortgage Credit certificates, another great way to save the access to affordable credit. You know, if your income, if your credit score, is down around the 640 minimum, you might have a higher, higher interest rate elsewhere, but there's no loan level pricing adjustments with these programs. So again, manufactured will often have a higher interest rate, and that doesn't change in these programs. So, so,

Heidi Griffith 8:47
right? So, and that's one of those big things that we actually really love the program about, is in the environment that we've been in for almost a few years now, when we're talking about interest rates, interest rates, in many instances, have cost associated with them, and you're right, they're also tied to your credit, so the better your credit, the better your rate. But in many instances, there's actually a charge for that rate. Yeah, with these programs, with rural housing and with the launch pad programs, there is no cost.

Kevin Hickey 9:18
There is that rate. Yep, the rate is the rate.

Heidi Griffith 9:20
The rate is the rate. Whether you have a 640 or you have an 820 Yeah, and

Kevin Hickey 9:23
whether you're buying a manufactured a condo, town home or single family. So those are, those are kind of the hidden benefits of the program. The down payment and closing cost assistance part gets all the attention, which is important, because that's often the biggest hurdle that home buyers have. So that the programs were designed to help homebuyers clear that hurdle, but then come with all these other benefits too. So so we're excited this time around that we have a whole new a buffet of options, if you will, for launch pad. And you know, the first program did extremely well. We helped 79 families and. In rural Nevada, purchased about $25 million in mortgages. So happy to be back with with round two and an even bigger mission. Yeah, we're excited

Heidi Griffith 10:10
about it. So for those that haven't tuned in and heard us talk about rural housing before, let's talk about rural really quickly, just so that people kind of understand. Because I know that my brain, and I always say this, but my brain goes to like, wide open spaces with a horse and exactly a cute cow. Yeah, that would be my pet. But it's not always the cases.

Kevin Hickey 10:30
It's not so we have kind of a funny definition of rule, which is actually set by the state legislature. Rule for us is anywhere with a population below 150,000 people, and that is determined by tax district. So you might think, well, in the Vegas valley, how could there be anything considered rural? Well, there is because there are tax districts with a population below 150 and that includes Summerland, South Winchester, smack in the middle of the Las Vegas Valley, and then Whitney out east. So those three areas, and there are smaller pockets around that are eligible as well and that folks can take advantage of. You might wonder, well, how do we find out that? And how do we know what's what? Yes, right. So we have a mapping tool on our website that you can get to it directly by going to H, A, L, M, A, p.org, so hell map.org, and you can type in an address and see if it comes up as eligible. And if you're not sure of an address, you just want to know of an area, you can type in something like Winchester, Nevada, it actually comes up. It's a it's an actual tax district. So it does come up in maps. Same thing with Winchester and Summerlin south. And you can see anything that's shaded in brown on the map is eligible. Anything in white is not. Those are those are going to be considered the urban areas. So we have that tool right there. And then, of course, they can always reach out to to us, at H, A, l@nvrule.org, and ask any questions. If they have them, they're just not quite

Heidi Griffith 11:59
sure that map is great. I know that we use it frequently, especially if people are purchasing in areas that you know. We know where those boundaries are to cross check, because when we're talking to folks and we're looking at different options for them, we like to lay it all out. This is what's available to you. Oh, wait, rural housing fits into this too. Let's look at those programs as well. So it's always a nice thing. So we've got those areas in the valley. We've got Mesquite, yeah, we've got from, you know, don't sleep on and I'm doing air quotes right now, rural. Yeah, right. We're seeing a lot of families because of number one, affordability and number two, availability, right inventory here in town, making a move, or at least looking at those kind of areas, and even if they're commuting back and forth into town, looking at those areas. Because, I mean, yes, there's more land. In a lot of instances, we've had a couple people go into Pahrump and purchase manufactured on large pieces of property. Yeah, I think they were on an acre for a fraction of what they would pay for, if that, if you could find that type of a property here in town, and they still work in Vegas, yeah. So there are options, I really think that absolutely, and even Laughlin, right, absolutely. And we are going to do something in Laughlin. We are going to have an event in Laughlin, if you're listening from Laughlin, we are coming. We just have to put it all together.

Kevin Hickey 13:21
Yeah, there, there is a lot of opportunity. It right here, in, you know, in those three pockets of eligibility. But if you just go outside, just outside the Vegas valley, and look at places like Pahrump and mesquite and Laughlin, there is a whole lot more opportunity where it may be more affordable. So that's definitely, you're absolutely right there. Those are good places to

Heidi Griffith 13:44
check out. And we're good in like Boulder City, right? Logan Dale,

Kevin Hickey 13:47
yep, Logan Dale, Overton, WAPA, everywhere, but Vegas, everywhere, but the cities, the city limits of Las Vegas, North Las Vegas, and Henderson, and then the larger townships, if we want to call it that enterprise, Paradise, Sunrise Manor and Spring Valley, right? Those are all over 150 that's pretty good. I know it took a while, but yeah, we have that. And now and then we have the other ones, right? Winchester, Whitney and Summerlin, south, so, so south, 89135, Yep, those are the areas where it works.

Roland Daniels 14:23
And how long do you think that 89135, Winchester and Whitney will still be eligible for these programs? Good

Kevin Hickey 14:32
question. Yeah, so I think a long time because they are smaller areas and they're they're not necessarily landlocked, but they kind of are, because Whitney has mountains and and the Vegas Wash, you know, going out toward Lake Las Vegas, that's all bordering on one side of Whitney. So there's not going to be a lot of growth beyond that, at least in the foreseeable future, when Whitney, sorry. Winchester is definitely landlocked. It's all built, so that's that will not go over. And I think the same thing with Summerland south, you know, pushing up against the mountains, right? It'll probably keep it small enough and

Heidi Griffith 15:12
when. So when we talk about those areas, right, we're only looking at that census track how often,

Kevin Hickey 15:19
every 10 years when the census is done every

Heidi Griffith 15:21
time. So we still have full time, right? Yep, we've still got exactly so,

Kevin Hickey 15:25
you know, as you know, we had enterprise up until the last census was done in 2020 and we benefited from the fact it takes a couple years for that data to, you know, come out and be fully published. And so we held on to enterprise until about 22 maybe 2023 early but, but it was, it barely held on in 2010 so we knew it would go away in 2020 but I think the the remaining three will will be around for a long time. Well, that's exciting.

Heidi Griffith 15:54
That's let's talk because we actually did a class in Whitney, right? Yep, we did a class at the Whitney library. I, I really love the fact that we're able to take a look at that area and utilize rural in that area. And I say that because it's an area, it's a

Kevin Hickey 16:12
targeted area, right there are, there are parts of Whitney that are right. And

Heidi Griffith 16:15
that sounds like a bad word, and it shouldn't. I, I want to kind of squash all the negativity when we hear that word, because it's an area that doesn't have a lot of home ownership in many instances, right? We grow the homeownership in those areas and kind of rebuild the areas so that the communities that we're living in have homeowners, have sense of community, have all of that great stuff. So I really, I really feel that Whitney is kind of my calling, and I'd love to see great things happen in that area. Yeah,

Kevin Hickey 16:48
Whitney is a great spot. As you know, there's there's even been some new construction in Whitney. It's one of the more affordable areas in the Las Vegas Valley. And you add this program, or one of our programs, on top of it, it makes it all the better it does and accessibility everything. Yeah, exactly. So Whitney. Whitney is a place to check out. Like you said,

Heidi Griffith 17:10
I agree, I agree, and the affordability is still there as affordability goes right city right now. So, yeah, definitely, again, one of those areas that we don't want to sleep on, right? Yeah.

Roland Daniels 17:20
So can I circle back when it comes to VA loans, let's say we take advantage and get the 5% and let's say closing cost only covers let's say closing cost is about three and a half of 4% what happens to the remainder of that money? The remainder

Kevin Hickey 17:36
will pay down the principal so you, you won't get a cash back or refund. You can get any earnest money that you paid out of pocket. You can get that out of it, get that back, but otherwise it would just go to paying down the principal and using that 5% example, the great thing about the new launch pad program is there's options for different amounts of DPA or assistance. So maybe you only need that 3% and you don't take the full 5% so it's great to have those different options. So there's a, hopefully, you know, a just right fit for each borrower who's looking at the program to to make the most out of

Heidi Griffith 18:15
it and pay. And actually doing that principle reduction is a thing, right? Yeah, we're building equity in the home before you get your keys. This is, I mean, really great point. Thank you for bringing that up. Thank you for bringing that up, of

Roland Daniels 18:29
course. And before we close today, definitely want to talk about Yes, the big elephant in the room, will these programs be around. Because just like Heidi was saying, we've been hearing it on the radio. We hear it on the streets that down payment assistance programs are going away. Can you please address it

Kevin Hickey 18:51
so the launch pad program not to get too much in the weeds. But the launch pad program is funded through private activity bonds, and there's different types of bonds, taxable, tax exempt. And basically what it is is it's bonds that are put out to investors. It could be anything from, you know, large corporations, to you or I right now, it can be individuals that invest in these bonds, and they sell those bonds that raises the money to offer these programs. So right now, for Launchpad, the initial mortgage volume that we're looking at is 25 million, but it is the plan that this time around, it will be continuously funded going forward, because those bonds will continue to be issued. There's programs like home at last, the original home ownership program at Nevada rule, which is still around, that's funded through the markets. So that is a self funded program and will never go away. You know, the rates and the rate availability varies because the markets have been so volatile. But as we see rates start to go down, and hopefully they keep trending that way, then we'll see more more assistance options and better rates. With that too. But that program, in and of itself, is self funded. It won't go away, and launch pad is here, as long as we can keep offering bonds and people are wanting to buy them, and when

Roland Daniels 20:11
it comes to home at last, we can use that down payment program over and over. Is that correct Home At

Kevin Hickey 20:18
Last has no restrictions on how many times you use it. You can own another home and still use home. At last, you just have to make the home you buy in using the program your primary residence, excellent. But yes, you can use it.

Heidi Griffith 20:29
So that's great. If you're moving from out of state, you're relocating here because of work or whatever that looks like. You don't have to sell your home in your current location. You move here. You can utilize that program keep your home in wherever it is, yeah, rent it out. And then if you sold your home here because you were downsizing or upsizing, whatever that looks like, you could actually purchase another home using the program. Again, great.

Roland Daniels 20:52
And what if I own a home here already and I want to make that into a rental

Kevin Hickey 20:57
that's okay? Oh, yeah, excellent. You have to whatever house you buy in the program has to be your primary residence. You gotta live in that one. Let's just say you have a condo and you're ready to move up to a single family home and and of course, there's different rules around whether or not you can rent your condo out on your own or what, but let's just say you can. You can turn around and rent out that condo and use the program to help you purchase that single family home, and then you have the rental income that's right, of that property that we can use to qualify help boost your income to qualify for the next house. So it is the, it is the real estate game, right? It's the one, the most common way that Americans build generational wealth that is in America. Yep, yep.

Heidi Griffith 21:37
It is the easiest way. It is a long term investment is really is? We say it every day.

Roland Daniels 21:44
What about refinancing opportunities when the rates do drop? Can we still utilize the program? You

Kevin Hickey 21:49
can still utilize you can still refinance with Home at last, all the same benefits. If you don't have quite enough equity, where you're still paying mortgage insurance, you still get to take advantage of that reduced mortgage insurance. You know, if you're going conventional and your income is below 80% of the area median income, but you have that, you have the same credit requirements as if you were getting down payment assistance. And so with that, with the home at last program, there is the unassisted rate that you can use to refinance. And just as an example, today, the unassisted on a government loan is 6625, yeah. So it's a great opportunity there. And we know, you know, maybe rates are trending down, which is great, fingers crossed, fingers crossed. But you know, in the height of the craziness of the last couple years, there's folks out there and interest rates that are that are over eight, they are, we know this. So So those folks are definitely nearing or in refi territory. You know now we're in the very near future. So,

Heidi Griffith 22:49
so a step would be, if you're thinking about refinancing your house, and you think, well, maybe I am in one of these rural areas, or maybe I am in a rural area, this might be a time to reach out absolutely and find out what that looks like. Yep. So we can't leave today. How much time we got Roland?

Roland Daniels 23:05
We got about seven minutes. Okay,

Heidi Griffith 23:07
we have to talk about my favorite thing,

Kevin Hickey 23:10
the MCC, yes, sir, the MCC mortgage credit certificate. That's the long of it. It is a federal tax credit. So it's not a write off. It's an actual dollar for dollar credit and on the mortgage interest you pay every year, so up to 20% so you know, when you when you have your mortgage, you have your house payment, portion of it is interest. 20% of that interest you pay each year can come back to you as $1 for dollar tax credit, 20% 20% so the example we like to use $350,000 loan amount at a six and a half percent interest rate equals about $4,500 in savings the first year. And again, that's $1 for dollar tax credit. So that's money that you can help, that you can use to help your borrower boost their income and lower their debt to income ratio to either help them qualify or maybe qualify for more, maybe qualify for a bigger house. And then that's the fringe benefit. The benefit is that they're going to get that money back in their taxes every year that can be used for anything, vacation, home, remodels, education, you name it. It's it's up to the borrower how they want to use that, that money that goes the entire life of the loan, all 30 years. And if you refinance that loan down the future, the MCC can be reissued so that you can continue to get the credit with the new mortgage when you refinance?

Heidi Griffith 24:41
Well, because you recently did that, you recently had someone do that. Yeah, absolutely. And

Kevin Hickey 24:46
we've had, there's no limit on how many times you can reissue an MCC so we had one recently. It was the third, third time. So they've, they've refinanced three times, and have gotten to. To take advantage of the MCC all along. Yeah. So it's, it's a that is for first time borrowers only. Great. I was gonna ask, however, if you are a veteran, qualified veteran, or if you're purchasing in a targeted area, like we'd mentioned, that waives the first time borrower requirement, so you can still take advantage if you're in one of those two scenarios, and first time doesn't mean you've never owned a home. It means just not in the last three years.

Heidi Griffith 25:24
That is correct, because a lot of people assume never owned a home before means never

Kevin Hickey 25:28
owned a home, never owned a home buy. Yeah, no. Three years now, I'm

Heidi Griffith 25:32
correct in saying that we can't use the mortgage credit certificate with Launch Pad

Kevin Hickey 25:37
correct for the launch pad for first time home buyers program, because they're both first time home buyers. They're both funded through that bond cap we talked about. And so because that, it's tax exempt the IRS as well. You can use one of these programs at a time, but not both, but it can be paired with launch pad, because that is a three and the 5% three and the 5% it can be paired now remember, that's not specifically first time home buyer program, which is why it can be paired with it, but the first time home buyer income and purchase price limits of the MCC still apply.

Heidi Griffith 26:10
So why would I, let's just say I am a first time home I haven't owned a home in the last three years. Why would I choose the first time home buyer program that's two and 4% over the launch pad, three and 5%

Kevin Hickey 26:22
so the because the funding the first time buyer program is tax exempt bonds. The regular one is taxable bonds. The rate isn't quite as low on that program. So better. You're going to have a better rate on the first time home buyer program. But let's just say you are a first time home buyer, it might be beneficial if you need the higher assistance of launch pad, if you need that 5% and maybe you need the credit from the MCC to help you purchase the home, or even just help to make it or keep it affordable long term. That's the big one. That's the big one so you can still be a first time home buyer, use the regular Launch Pad program and the benefits it offers, and get the MCC and get the mortgage so it again. It's all about creating options so that there is the right fit, best fit, for as many borrowers as possible, because

Heidi Griffith 27:16
in many instances, we're still seeing seller credit. So if you went with the 5% down payment option, and this is obviously, we would break it all down for you, and you would have a look at what each program looks like. But if you went with the 5% down, three or three and a half percent of that, depending on whether you were going conventional, with the 3% or FHA, with the three and a half percent, you could with the 5% down, you could use, let's just say the three and a half. We'll say we're going FHA, use the three and a half percent for your down payment. Take that other percent and a half. Use it towards your closing cost. Maybe get some seller credits, if your Realtor can help negotiate those and come out of pocket with very little plus, get those mortgage credits at the end of every

Kevin Hickey 27:58
year. Credits, Yep, yeah. So it's, you know, it's definitely numbers, definitely a numbers game, which is why we appreciate all that you do to help your borrowers understand all the options. Because there are, you know, there's going to be pros and cons to it all. We like to think more pros than cons. But, you know, maybe this one has more pros than this one, you know. So having that whole list of options is what we're aiming for. We like

Roland Daniels 28:25
to call it opportunities and options Absolutely

Heidi Griffith 28:27
because you're absolutely right. Not everyone has the same goals, right? So maybe someone is looking for the lowest payment every month. Maybe someone else is looking out for the lowest out of pocket expenses. So there's options. There's always options. There are always programs available. And we absolutely love Nevada Rural Housing. We do you guys offer. Thank you again that that seat is yours. Your name is embedded on the back of it. Please join us anytime. Thank you. I appreciate it. We answer, that's a wrap, boy, that was a quick 30 minutes, wasn't it? It was, yeah, thank you for joining us today on mortgage matters. I want to thank you again, Mr. Hickey, and, of course, thank everybody for tuning in today. Remember, if you have any questions or want to register for any of our upcoming classes or workshops, please feel free to give us a call or text us. We're at 702-210-2057, and don't forget, you can always check out our full calendar of events on our Facebook page, mortgage matters, radio,

Roland Daniels 29:24
we'll be back next Sunday at 7:30am right here on K, U, N, V, 91.5, until then, have a great weekend. And as always, stay true to yourself and your mind. Bye. You.