What’s Really Stopping Capable Buyers from Buying a Home Right Now? I talk to buyers every day who are this close to pulling the trigger, and then they freeze. The two stories I hear most: "The sky is falling - prices are about to drop." "Rates will go down soon - then I'll buy what I really want." Let's unpack both, then I'll show you a simple plan that works whether rates fall, stay flat, or even tick up. Myth vs. Reality (Quick Hits) "Prices will crash." Yes, the market is softer. However, there’s a significant amount of homeowner equity available. That makes a foreclosure wave - and a big price crash is unlikely. Could prices wiggle? Sure. A 2008-style bank-owned fire sale? Totally different setup today. "I'll wait for lower rates." Rates may trend downward, but nobody knows when or by how much. Waiting can cost you the house you want, the neighborhood you want, and the leverage you have right now while competition is calmer. I’ve done well by investing consistently, yet not perfectly. A primary home isn’t a pure investment, but for most people, it’s their most significant financial decision. Timing matters… but a clear plan matters more. A Practical Plan If You Think Rates Will Be Lower Later Use a Lender-Paid 1/0 Buydown + Refi Plan. If today’s 30-year fixed is ~6.125%, a lender-paid 1/0 buydown can drop your effective rate to ~5.50% for the first year (because a lender credit reduces your payment in year one). In years 2 - 30, the rate is ~6.50% - with no extra cost to you. In some situations, a seller-paid buydown can lower the first-year rate even further (e.g., around 5.125%), depending on pricing and credits. If rates drop in the first year and you refinance, the unused portion of the buydown funds is applied at payoff/refi per investor rules, which is a nice extra savings. Our promise: With our Free Lifetime Refinance Guarantee, when rates improve, you can refinance with no lender, escrow, or title fees (on approved credit; typically, available for loan amounts >$400,000 and FICO ≥720). I could argue that rates will improve, and prices will increase. I could also argue that this market is due for a correction, but if rates come down, I don’t see that happening. Rates increased by 4.5% since 2021, and prices have still been rising, with a slight decline just 3.5 years later. Renters are missing out on tax deductions, appreciation, principal paydown, not to mention pride of ownership, and so much more. Homes are not cheap to maintain, but they provide a solid foundation for a family and are a necessary building block for retirement. It is our duty as Real Estate professionals to explain the possibilities to potential buyers and sellers. I don’t know anyone who thinks prices will be lower in 10, 15, or 20 years! My Grandmother purchased a house in Los Feliz for $3000.00! Need I say more? Oh yes, and one more thing! Please RSVP to Oktoberfest! Please let me know if you have any questions or if a client needs my guidance. I’m just a call, text, or email away. 📞 Direct Line: 661-291-2222 – Text OK 📞 Cell: 661-714-6258 – Text OK 📞 Office: 661-260-2970 ext. 2222 – Text OK 📧 Email: Mike@AugustaFinancial.com But wait, there’s more… Interest Rates Interest rates were better on Wednesday and Thursday, but then worsened on Friday and Monday. Today has been good so far, but I ain’t counten no chickens yet! Loan Programs We do loans on Non-warrantable condos! We offer 12-day escrows for pre-approved buyers, including conventional FHA/Jumbo/Bridge loans. We provide loans in all 50 states, so call me with anything you need. Government loans (FHA/VA/USDA) are in the 5s. Conventional loans up to $806,500 are in the high 5’s and low 6s. High-balance loans from $806,501 to $1,209,750 are also in the 6s. Jumbo loans above $1,209,750 are in the 6’s. ARMS in the 5’s and some in the 6’s Bank statement loans are available with 10% down again, with larger down payments in the 6’s++. Profit and Loss Statement loans require 20% down - no bank statements needed, only a profit and loss statement! 0 down loans are available in the high 6s, with a minimum credit score of 620, up to $1,300,000. Private Money lenders offer Hard Money Loans with 35% down. No-Ratio Loans require a 30% down payment. DSCR (Debt Service Coverage Ratio) loans are available with as little as 15% down. Bridge Loans typically have an interest rate of 7.99% with limited fees, helping you get where you need to go! 3/2/1 Buydowns, 2/1 Buydowns, and 1/0 Buydowns are available at great starting rates! Please note that interest rates are subject to change without notice, and the information above reflects LA County Loan Limits. **Good News for Condos:** NONE **Bad News for Condos*** Nothing New! CONDO HELP!!! If you have a listing or a buyer interested in a specific condo and are unsure whether it is warrantable or Non-warrantable, please call me, and we can look up Fannie’s list in real-time. I have already done that on three condos today, and my list was accurate on all 3. We don’t know when something has changed, and it would be impossible to track everything on a day-by-day basis, but we don’t mind looking up a few items each day. The full state of California’s naughty list has been added to: MikeMeena.com! See the link below: https://mikemeena.com/non-warrantable-condos/ Let me know if you hear anything new about condos or townhouses. I am available every day if you need anything. 📞 Direct Line: 661-291-2222 – Text OK 📞 Cell: 661-714-6258 – Text OK 📞 Office: 661-260-2970 ext. 2222 – Text OK 📧 Email: Mike@AugustaFinancial.com Have a great day and an even better tomorrow! Please call me when you have a client who needs to borrow! Mike Meena President | Loan Officer Click to Call or Text: (661) 714-6258 This entry has 0 replies Comments are closed.
