Hello, Hello, Hi, How are you. I'm doing well? How
about yourself? I'm doing fantastic. How's the week, a month, the
year been for you so far? It's been great. Um. It started
out slow, honestly, but everybody and it's came it came back strong,
very very strong. Um. And and it looks like you might stay that
way. Good. Good, I'm happy. I think. I think the
same thing I think. Uh, December was okay, January was was good,
February was slower. March you starts seeing more activity, and I feel
really good about April and the remaining of the year. Yeah, exactly.
I'm seeing a lot um like still lines out the door open houses. They're
few and far in between, depending on you know, the area that people
are buying, but like here the marketing like North Jersey. Um, I'm
seeing this crazy right, there's there's literal lines out the door, which is
kind of like beginning of COVID. We'll not begin mid COVID. I want
to say, right when one open house fun up and the line was down
the block, same thing out of realtor actually posted today on Instagram and I
was like, oh my god, I can't believe it. I got like
twenty thirty offers on every house. It's insane. Yeah, yeah, I
mean especially multi family. Multifamily is really hot right now. Yeah, everybody
is thinking investing and investments, and I think it's it's the mindset that most
people are in now. So we're seeing a lot of activity there that there's
tons of investors. Everybody's looking to do all different kinds of projects, but
I think multifamily is really the hot spot in a lot of areas of northern
New Jersey. So when it comes to making investments in any piece of real
estate, whether it's single family or multi family or you know, and anything
you could think of condo, ha, you know, all those kind of
things, it's really important to get pre approved yep, right, always get
first and then starts shopping, you know, until you know what you can
afford, what you can buy. Um, you're you're you're wasting your own
time more than anything, you know, because when I look at something comes
on the market, then you rush to do everything. You don't really get
the right information, especially when you're always rushing. Um and by the time
you're you know, you're ready to submit offer, ass has gone right,
well, you sit beforehand, you can pre plan. You know, Hey,
I want to be in a certain school district, or I want to
I wanna have a certain payment. I think that needs to be a big,
a big focus point for people because obviously, you know, rates go
up and down and everyone's freaking out over it. Um. I don't know
if you saw, like the news, everybody talking about lllpa's and saying,
oh, if you have worse credit, you're gonna get a better rate.
That's so not the fact. Um so it And by the way, those
things that they're all talking about today have were announced months ago. Um they
pushed back like the on set day. However, a lot of banks already
were implementing them into their their prices in structures. Um doesn't mean if you
have better credit, bad credit, you're gonna get a better rate. That
does not That's not what it means. Um. It just basically it's kind
of how rates are determined for people or you know, based on what you're
buying, how much you're spending, how much you're putting down, what kind
of loan you're getting, um, how much money you make that Actually you
know, and I think I said this before, it makes a difference,
Um, all of these things. What I think, Um, I think
you're going to see so many more FAH buyers. Right, It's like it's
pay the payments are just come up a lot lower due to the fact that
you know, if H moves don't have those you know, low level price
adjustments, so you're getting a better rate, better payment, you know,
better everything. Why not go that route, you know, a little bit
less money down. So I think sellers need to actually start getting sellers need
to get educated anything. Um, I don't know if you've seen you know
this, and you probably have, especially in these markets when they're really hot,
but if you have. I had a realtor one to tell me.
She's like, hey, yeah, we accepted your clients pre approval or your
clients offer, not pre approval, your clients offer because he's put in twenty
five percent down and he's conventional. She goes like, we had thirteen other
offers except the other thirteen due to the area and the fact that it was
like a three family house. They were all at H so they were all
first time home buyers. Now the buyer was an investor, right, so
obviously you know you wind the one per contractor one back to renegotiate the ask
for X, Y and z blah blah blah. Guarantee you if the seller
and the realtors and everybody sat down and looked at all the other fh A
approvals, that deal would have been closed, you know, and it would
probably been closed at a better price just because they you know, that's what
the offers were. But because the seller got afraid because they were all fah
A, they was like, oh, let me just go from mentional.
It's the easier round. Well, that mentional buyer has a lot more money
down right, right, he does. But also they know they are hit
very well. They know they can make adjustments because they need to fix X,
Y and Z and so on and so forth. I just think,
I just think sellers really really need to consider all offers right when they're getting
them in just you're going to see so many more buyers trying to go to
the fh A route. It just makes more sense for them, you know.
Yeah, payments especially, I don't know how what you're seeing on your
side, Um, I mean you see a mix of things. I mean
you have. I mean, I think just traditionally and historically people look at
FAH loans as the more complicated way to go, and people are thinking well,
sellers and sellers agents are thinking that in a market like this, right,
because if we were in a traditional market where things were moving a lot
slower, people have more time, people are a little bit more patient,
people are willing to take a little bit more of a gamble, maybe negotiate
some more. But when you're in a market where things are moving so quickly,
people begin to have the mindset of just that, let's try to move
this along as quickly as we possibly can. Nobody has time to waste,
we don't, you know, so people who are trying to look for essentially
the easiest deal. Now, when it comes to selling and being on the
cell side, a lot of the times, right, it has a lot
to do with what's important to the seller. Is it the price, is
it the timetable right, or is it the strength of the buyer. So
there's three different things that you look at, and a lot of the times
when they're looking at conventional versus AHA, their look looking at what can move
along more quickly. And the idea is that if someone is FHA with a
minimum down payment and there's issues with the home of which it may or may
not pass inspection. Is the buyer capable of making those repairs, because the
sellers are in position in a position right now not to make those repairs,
so they don't want to deal with that negotiating back and forth or wind up
having to back pedal a little bit on the pricing because the buyer doesn't have
that capability. But what I like to do how I put a lot of
my deals together is you know, if if I do have an FH A
buyer, you want them to have the mindset like, hey, there might
be a list of things that need to be fixed or replaced office home.
Are you in a position to accept responsibility for those items? Should we need
to do that in order to a praise? And nine times out of ten,
once you get them to understand what that looks like and what that can
mean, if they have the finances available, it's so much easier to put
together a deal. And in that case, there's nothing for the seller to
worry about. Absolutely absolutely. That's That's something that you know, I think
a lot of people don't look at is just because hey went into contract and
that's it, things can still be negotiated throughout the process. That that is,
you have a due diligence period, you have a you know, a
commitment date that you have to meet. The thing is, I'm seeing a
lot more you know, people going into contract and then you know, normally
we used to see, hey, I want this done as quickly as possible.
However, that seller will become a buyer right for them for the most
part, maybe not every time. When they become a buyer, they're going
to deal with the same exact issues that their buyer was dealing with buying a
property, making sure they qualify, making sure the property qualifies, and so
on. So when if they're educated up front, hey listen, this is
you know, this is what you're gonna deal with with your selling yours or
you're gonna deal with buying the other. We're seeing much more bigger timelines right
for the most part, usually especially deals in Jersey, thirty forty five days
or like max right, I feel like everything closes within that thirty day period
usually um and getting a clear to close in today's market within like two weeks.
It's it's nothing out of the ordinary, right, So it's become there's
plenty of technology, people can get you everything to you like how many clients
do I have that I have never actually met face to face. They've gotten
me all their documents as soon as we ask for them. We upload everything
quickly. They get looked at within the same day. You know, I've
had I had a deal submitted from scratch, right, submit it. What
are the appraisal, what our title got? The conditions? Cleared? Everything
within seven days? Right? Yeah? Yeah, so like that was a
New York deal. Normally New York deals are like, oh, here's forty
five days on contract. Also it's like honor about so maybe we need an
extra thirty days on top. That turns into what seventy five days very quickly.
Right, that's a very long deal. So even locking sometimes, you
know, like locking the rate, the longer to locker rate usually the worst
it is. Right, So even locking the rate for people and you want
to lock them in so they're not subject to however the markets going, you
know, until that deal closes, becomes very difficult, you know, trying
to climb everything. But I'm starting to see even on the Jersey side,
right, because they know, hey, I'm some of my house. I
need to buy another house, right, and I need to be prepared.
I might need thirty days, sixty days. I had, you know,
one of my closest friends. He got into contract in January. Actually,
if I'm not mistaken, it could even be in December. They closed at
the end of April, not because of them. They could have been ready
in two weeks. Everything was easy, you know, they're easy to do,
very large down payment the homeline. The issue was the seller said,
hey, I need to find the house needs to be ready for me.
Obviously, So even though they close, the sellers still needed an extra two
weeks to live in the house until they were able to finalize everything on their
purchase. So I'm starting to see that a lot more. I think everybody
just needs to be a little bit better educated, especially on the products,
if you don't think like you know, on the realtor side. And I
get calls all the time, but I even try to call them advance,
especially now since the you know, multiple offers are back out there, you
know, reaching out to the listening agent and saying, hey, listen,
this is our client. This is what we did to make sure they're qualified.
Right, I can get it done where I can always say listen up
to you know nine with certainty. This will close. The reason it's always
ninety nine percent because anything can happen right to that client. What if they
lose their job or something happens and that we don't have control over, right,
so we can get all that done in advance. Now if if on
one side, like the seller says, hey, I want to speak to
whoever the loan officers if they're gonna stick with this loan officer, you know,
have they done all their due diligence? Have they checked everything check,
credit checked, income checked? Assets, are they're getting gifts? If they
know all of that in advance, everything can get clear very quickly. Now,
something as miners like paint right, it's like always a big issue.
Or I had an issue with with wallpaper and a n FH deal right wallpaper
feeling? Wallpaper, yes, with back on like crazy. But like something
that minor, let's say a seller's like, oh my wallpaper is feeling.
I don't want to deal with it. Right However, you might be given
up like a very strong buyer. You know, so you want to be
educated in advance for it. Like you're you're listening your house. It is
hot depending on the area you're at, because you know, I read up
on it. Yes, there are some markets you know that have gone down,
you know that are not as hot as we're at apparently, However,
the you know, everyone needs to be prepared on what the next step is.
Right, submit an offer, I fully pre approved, truly right,
like we had we had a deal where you know, you and I together,
or the person made certain mistakes that had it came to us before all
that, it would have been easier and closed the very quickly. But we
still met our timeline. We still close within the contract date. So like
you know, working with the right people, making sure you're doing everything correctly
up front, making sure you truly get pre approved, run your credit,
do the whole line. And people need to remember that you can run your
credit within that thirty day period. If you want to shop around, you
go to Chase, you go to well spar you go wherever you want to
go. You have that thirty day period to run in quite multiple places for
the same thing, not for for anything you want clear and it does not
you know, it all comes up as one transaction basically like one hit.
So they can always do that as well. Not to be afraid of,
hey, don't run my credit because you know, I don't want to and
get I want to buy a house, but you know I don't want to
actually take the steps so that that that brings me to this. I do
get so many clients that are not interested in running their credit. So they
come to me and essentially say, well, I will submit all of my
documents and I will apply for a pre pre approval after I find the home
that I like. So in this market, we don't have Yeah, we
don't have that kind of time. It can if you need financing, that's
the wrong way to go about it. That's the wrong way to go.
And I'm you know, there's some clients where you know that they're well equipped,
well prepared, you could probably get a pre approval right away, and
you know, you might be a little forgiving for clients like that. But
then there are others where you know that deal could it could be a little
bit more difficult to put together because of their financial situation. So why is
it important? Why is it important to get pre approved before you start looking
for homes in this market? Well, I mean, who are want You
want to know what you can afford? Number two, you want to know
what payment you're going to have a lot of people are getting payment shock right,
they're running things and they don't know that day and day out interest rates
change. So if you don't get pre approved in advance, right, you
might Number one, you might not know what you truly qualify for because most
people don't. Right. You might have things on your credit that you forgot
about. I get a lot of people that hey, credit carm or something
not to just put them on last. But like says X yet I run
credit and I see you know why all of a sudden, now we have
issues that we have to deal with. How to prepare yourself to buy right.
So if you, let's say you're getting a gift, right, that
can make a difference, right, like how much money you're putting down,
how much you really qualify for? What is your income rational? What is
your actual income? Right? Because I get a lot of like I just
got a one of my tenants actually reached out to me and he said,
well I make x X amount of money. Great, well that's what I
showed on my taxes. Okay, fantastic. Well I don't work out of
the job anymore, and then I can't use that job. Right, did
you even work for? He was trying to use two jobs at the same
time. Right, that he did. However, he didn't do them for
two years, so I can't use them, you know, I can all
use one of the two. Yeah, when he stopped working halfway. So
like there's just like there's just there's so much information out there, right,
talking with an expert makes it a lot easier, right, it does.
I don't know anything about the stock market, you know, I'm not an
expert on the stock market. When I wanted to invest or, you know,
like, um, let's say some type of life savings to the side
on that I sat with, you know, on a financial advisor that knows
a little bit better. Hey, you can buy X product by product and
sit with that. If you're not going to actively do this, right,
Okay, great, that's what I'll do. Right. I'm not a doctor.
If I get sick, I'm not just gonna self treat myself, right,
Right. And taxes, like like how much rental income you can use.
Let's say you're buying a multi family house, right, and you want
to buy a four family house. We've spoken about this before, where you
look at something that's like seven eight, nine hundred thousand dollars, you know,
for argument's sake, however the rents are like a thousand dollars for that
market, Well, what you might qualify for that house? Right, Maybe
the house doesn't qualify for the specific type alone you wanted to use. Right,
So those are other things that like people don't really are not aware.
Maybe whatever you're calculating, you know, costs you a lot more. Maybe
you're not ready for the closing costs. What are the closing costs? What
are you gonna pay for? Though? There's just there's just so many factors,
right that going about it like backwards fine in the house, then rushing
to get pre approved, right, you might miss something that actually is more
beneficial to you. There might be a more beneficial program, because when you
rush through anything, you don't do it correctly. However, if you get
all yourself ready to submit it beforehand, and you say, hey, let's
let's see what we can get pre approoveled for, we're all all you need
to know is I'm looking in this area, right, so we can at
least estimate whatever the taxes are going to be on the property. Right,
Am I looking in a flood zone? Right? Like cloning trance is very
expensive. A lot of people don't calculate into that. Am are the taxes
on a property five thousand or fifteen thousand? Right? Are what else?
Interest rates? Are they at five or they at seven? Right? Like
you asked me that question. Hey, I thought they were a little bit
lower, Right, I thought they were a little bit higher. Right.
They're constantly changing. Right, So you want to you want to be aware
of everything in advance. You don't want to start going looking and then a
lot of places actually if you need financing, Like I've seen a lot of
listing agents that they won't even like really make an appointment in advance. They'll
be like, oh yeah, just come to the open house now, you
got to go on their schedule instead of everybody else's like because you're not you're
not showing that you're a serious buyer. You haven't taken the steps to be
a serious buyer too though, correct, especially if they have, Like I
said, fifteen offers, you know, as are fifteen offers, Why would
you waste your time with the one person that's now Russian going to get prety
proof? Correct? Not what seller is going to look at it? Well,
I'm not going to do this because if they're rushing for this now,
they're gonna drag this out forever, even on the so they automatically might disqualify
you on that side. It's just how the market is. If this market
was a little bit different where hey, listen, it's a buyer's market or
whatever, and you have plenty of time, there's plenty of houses. You
can go and see a bunch of houses right and say, you know what
this is now that we see them, this is kind of what we want
to stick to. Fine, you want to go that route at that point,
no problem, not right now, right now. It's very very like
again, very depends on the market, you know, on these very hot
markets, you've got to be ready, you know, because on that spot
I've done. I did a pre approval for someone at ten pm on a
Sunday, and I was like, this needs to go in right now.
She's I guess, like, I don't know why. I guess I don't
know when they're meeting with them. I need to make sure I submitted before,
you know, before tomorrow morning. So great, no problem, let's
get it done right. It was easy because that client was pre approved.
I just had to adjust it for whatever they were purchasing, so that like,
technically I'm already working for that client. They already did everything with me.
I checked everything for that, getting them re you know, technically updating
their pre approval to the property they're purchasing. Now, that's easy. But
imagine this client is sending me everything at ten pm at night, you know,
and I have to rush through it to try to get them, you
know, pre approved. It's much more difficult. And then also with all
due respect to all parties involved, you know, um, I just think
that, you know, a person who is serious about buying should just go
and prepared. It just makes sense. You don't want to waste your own
time. You don't want to waste the agent's time, you don't want to
waste the lender's time. You don't want to waste the seller's agents time or
the seller's seller's time. Because everybody now has to work backwards and you know,
try to make haste. The sellers just won't won't like the seller won't
consider it, you know, as a serious offer. If you're rushing now
right, if you're again, if you're in the market, that's much slower,
and it's a buyer's market by all means, do what you you know,
whichever we want to do it. But if you're in a like a
very active market with very low inventory and anything that's popping up it's literally gone
by next weekend, you want to be prepared. Yeah, and pre approvals
have to be submitted with an offer, yeah always Yeah, today's market,
they don't want to just see what you're offering. They want to see that
you're qualified too, so you know, preprooval has to go in. Oftentimes,
people will list a home on a Thursday, which is the best day
to list a home. They do open house over the weekend. They have
multiple offers, they're going for highest and best on Tuesday or Wednesday the following
week Like, these things move very quickly. And if you don't have a
lender like yourself that's willing to work on a file over the weekend because a
lot of people take off and they do their own thing and they're not working
or what have you, it's very, very tough to put all of those
things together at the very last minute. And God forbid, you see a
house that you like, that you love, that you want to make an
offer for, and you don't qualify for it. You know, it's just
like everybody's spinning their wheels all the you know, just to find out that
that's not the right purchase for you. In so, looking at today's market,
I think there's a sense of urgency for people to invest because of all
of the things that are going on are allegedly going to happen, and you
know, people are panicking and everybody wants to make sure that they're financially secure
for the future. So you see a lot of people now thinking about real
estate as an investment. And as we know it, real estate is one
of the most promising investments that anybody could make in a lifetime. It is
an investment that is recommended for everyone to make during their lifetime. And I
feel like right now everybody has this is feeling the sense of urgency because they
don't you know, people want to have a financial security. So in twenty
twenty three, like, let's talk right now, why is it important for
people who qualify to get pre approvals right now? Well, I mean a
lot of things are changing, right so those the loan level of price adjustments
I was talking about earlier, like the LPAs for someone theer's they still have
them fully gone into effect, but they will, right, So when you
get preapproved, if you get pre approved let's say today, right, whatever
rate or anything like that they might qualify for today might not be the same
case in three to six months. Right. So if you're like working with
somebody that can kind of you know, and and a lot of times,
you know, we already see whatever they're going to be out there, and
we can check. I have access, I can contact my account executive and
say what are these changes going to happen, and work with somebody so and
on top of everything else, I and you work in multiple states as well,
But I don't really see prices or any of that going down right now.
If rates to come down, you know, by the end of the
year or let's say by next year. Right, there's already a low level
inventory with houses on the market. The houses that are coming onto the market
like new construction, not resales or things like that, are still very historically
low. And there's just so many more households that have formed over the years
that are ready to purchase, right, but they have nowhere to go purchasing
today, right or getting pre approved today and working and getting into your house
today at least kind of secures me that you can make the changes you need
to. So let's say they do come down down the line, right,
you can refinance and hopefully get a lower rate, or sell again at a
profit, whatever the case may be. But I I just see like this
market just constantly becoming more competitive, you know, every single offer, and
depending on the areas and depending on the price point as well, right,
because if you're talking like multimillion dollar purchases and you might have a lot more
wiggle room there. But like I'm seeing the meat and potatoes of housing,
where like most of us will qualify for is extremely competitive. It just isn't
really anything out there. Anything comes on the market immediately. So like getting
ready today, especially pre so spring season technically has started, right, I
think we can both agree on that, Um, get getting it done now
so you can kind of prepare, you know, especially I like getting as
as this market continues for the rest of this year. Um, I think
it's just going to get continuously more competitive. Houses have started coming on the
market. It's just no, like it's not bridging that gap of how much
is needed versus how much is selling, right, So it's just so much
more competitive. I think not to discourage anybody, but you know, see
see what you qualify for and go after it. You see something you like,
It's not really a long waiting game. You need to immediately sit there
and make a purchase, make an offer, and continue with with with with
your purchase, and hopefully rates do come down. But if they don't,
let's say, I think a lot of people are not really utilizing like what's
out there. Like, you know, there's still buy downs out there.
Everyone was talking about them last year and then that like everyone just stopped.
Right, if you can still do a two to one buy down, or
they can still try to find in some of their closing costs, you know,
they can still do all these things to help them offset the payment for
a little bit, you know. So I think a lot of people are
just not taking advantage of a lot of these programs. I usually tell all
of my clients that hey, this is what exists, this is what you
can do, um and they're just very like set in their way. It's
no, no, this is what I want to do, right, Like
I'm gonna go to my bank. Yeah, to my bank, because I
bank with them and I trust them. Unless you got millions in the bank.
It really makes no difference to them, right, So like, um,
I do see a lot of like and you have to on the on
pre approvals coming in from them that were like things haven't really been checked out,
the income and assets and all this other stuff, because they can essentially
give you a prequalification just based off of what you tell them, right,
and they issue that too. They run they see your credit all the time,
so you know they issue, they run it, issue, issue,
issue a preval a prequalification from their side, and then you're not qualified for
that or you're not qualified for the house. Right. I had a scenario
where someone counted detached garage like this was a major big bank counted a detached
garage as at that time an accessory dwelling unit, and they said they don't
finance those type of properties. That deal was such an easy deal for me,
like a very simple, great clients, amazing credit, more than fifty
percent down payment, which is like I went crazy, I can't believe.
Yeah, just such an eat for us, such an easy deal. But
that bank was like, hey, we don't don't finance that, you know,
and then at that point, you know, it didn't matter whatever rate
they were offering, which I still actually beat. But you know, because
they don't, they don't do those type of deals. I try to tell
people as much as possible, like, you know, my job is to
shop it around for everybody, right, That's what I do. Like,
I don't work for one specific bank. We work with over thirty different banks.
So when someone comes in, depending on everything that they have, it
might make more sense to go to bank aid than Bank B for them,
right, for whatever reason it may be. And that's what we do.
So we'll price them all out and I say, hey, these are the
approximate rates you're looking at. Right, If they're within let's say an eighth
of each other a few basis points, you know, I'll explain that to
the pine. But then they also have options, people like don't have to
take the rate that they get offered. Everybody gets offered let's say the cheapest
rate possible to them. They can always buy down the rate if they wanted
to. They can you know, go with a different program that they qualify
for. There's just so there's just so many options. I really think,
like sitting down with someone getting pre approved and then hey, let me run
out and go, you know, find that type of house that I'm looking
for. That's the right way to go about it. And we're seeing a
lot more clients people like a lot of people I think are becoming more privy
to that information and they're going to their little officer first and they're like,
Okay, now I know what I'm approved for it, let me start shopping.
The ones that are not doing that are the ones that are losing out
and they're getting discouraged. But if you didn't take the right steps to begin
with, of course you're going to get discouraged. You're trying to submit an
offer, you have fifteen offers with pre approvals, assets, everything in hand.
They're getting that. Of course, the seller's gonna say, well,
these people are already did the most of that. Have you lifted up front?
Yeah? I mean yeah, I mean it's true. Action is really,
really important. So you want to understand why it's important to get pre
approved in the first place. You want to understand why it's important to get
pre approved now. Right in twenty twenty three, there is a sense of
urgency to make investments. Everybody wants to be financially secure. Real estate is
one of them. The more promising investments a person can make in a lifetime.
And then I also think that regardless of the interest rates, people are
forgetting about that equity piece. It's really really important. And you did a
real on something that spoke to equity, and I think you mentioned in the
Real you said something like, you know, making a purchase now and what
it's what it's going to look like in the next couple of years, and
how real estate historically is always increasing. People's the tendency to forget about that
piece. They're thinking about the payment, they're thinking about the interest rate,
they're thinking about what it's going to cost them, not how much it's going
to make them. And I think that's a really important part to talk about
when educating your clients or um when even educating sellers you know that are wanting
to sell. Some some sellers don't even realize, you know, what they
could net after the sale. They're not they're not doing the numbers in their
head. They don't know how to do the numbers, you know. They
don't don't they don't understand where they are and where they could be in the
next two years. Sometimes it's better to sell now while it's hot. Yeah,
before waiting and you know, perhaps next year is not going to be
as as busy. So I think equity is huge. Yeah, absolutely,
some when I think I remember the reality you're talking about, it was everyone
is like when you're worried about the payment. Part of that payment, you
know, you're directly paying down the debt that you borrowed, right, part
of it is going to interest, right, part of it goes source of
debt. So at the end of the year, even though the I think
the better way to look at it is instead of putting money into let's say
a savings account, right whatever you can, because you're gonna have a payment
if you have to live somewhere, you're basically paying down your house. That's
your new savings account, right, Yes, So you're constantly doing that year
and year out. There was and I have these these graphs. They're actually
fantastic where if you are, if you don't think you're going to live in
this house for more than like one year, two years, it actually makes
kind of more sense for you to just rent, right, So if you're
going to be in there, in there for a very short period of time,
rent, don't buy. Right. However, as soon as you passed
those first two years, because there's costs associated with purchasing, right, you
have closing costs, you of all the other stuff. As soon as you
pass those two years, you know you're no longer breaking even you're already in
the green, right if you own a house, even with the costs of
selling it, right and every single year thereafter taking a very very very very
conservative rate of increase on prices right on real estate historically looking at whatever happened
before and just taking a very conservative rate of increase. When you compare that
to your rent right, and I saw it on a four hundred and fifty
thousand dollars purchase right at like six and a half percent interest rate and so
on. When you compared the difference you would by the end of like year
nine, I think it was you were positive two hundred and forty thousand dollars.
Right, that included appreciation plus the principal paid down because you're paying your
house down constantly every single year, versus on the other side. Right,
rental increases could be two three percent a year, right, someplaces saw fifteen
twenty percent. That's like crazy, Let's save them like three percent every year
three or four percent when you compare that to the difference, and don't forget
it's compounding, right, It's not just three percent. If you're paying a
thousand, it's not just thirty dollars every year. It's thirty dollars year one,
and I think it's thirty something, thirty six or forty plus whatever on
top and on top, and on top and on top. By year or
ten, you're really up there and rent and that's when you never get back.
Yeah, you're moving out. That's it, you know, even and
I'll send you this chart. It was fantastic because it really like it breaks
it down to the numbers. Right. Real estate historically, if we look
back all I think it was like the forties or fifties, it had such
a short like it would go up let's say over five or ten years.
It went up like one hundred percent. Then it went a little bit less,
you know, one two three, one two three, one two yearns
so on and again five, ten, fifteen, twenty percent kept up with
inflation or surpassed it a lot of times. Right, the price increases.
The only downturn we had, right, the real downturn, because there were
a couple of the years that had like a one percent price decreases over a
year over year. The only real downturn was two thousand and eight, anyone
two thousand and eight to two thousand and nine, thousand, even whatever,
until it caught up and started going back up again. Anyone that looks at
that and just consistently waits because it's so fresh in our head, that's all
we know, right, you know what I know? It like I was
going out of high school in oh seven, going into college in oait or
seven away, and no one wanted to be in real estate because everything started
crashing, right, Everyone was in it, and no one wanted to hear
about it. Anyone that invested from that point forward is a millionaire today,
I know, Like I oh yeah, sorry, mull sorry. Anybody who
purchased during that year is definitely a funny upside. But what happened back then,
Right, if you were in anyone that was in real estate between two
thousand and one or two to two thousand and two thousand and eight, if
you had a post, you got a mortgage shop right the barrier from NBS
Highway. Love him he you know, all he is is about numbers and
grabs and charts, like he really pays attention to all this other stuff.
Is like if you could breathe on a mirror, you've got a mortgage.
At that time, major fraud, right, anyone was able to get a
pull. There was massive, massive increase in building, which hasn't happened since
then. Right, So it was a completely different market. Anyone waiting on
that, right, is in for a surprise because it's very difficult to have
you know, housing go down, hunter crashing or any of this other stuff
where when there is no housing for sale, Yeah, how many people.
It's also hard for people to struggle on two to three percent, you know,
two to three percent interest rates, and even if they are, they're
sitting on such massive amounts of equity. Right, the average loans to value
throughout the country is about forty eight percent. That means people have fifty two
percent of equity in their houses on average. Right, Like taking everybody's more
in driving, some people probably put less money down. There's just every sign
points the other way, you know that they're really waiting for prices to truly
come down or do all this other stuff. I don't see it, right,
I'm seeing less and less houses, right, Like in the three four
hundred thousand dollars range used to have plenty. I remember in two thousand and
twelve, I personally was looking twenty twelve thirteen at a house. It was
like one hundred and nineteen thousand dollars beautiful house, needed nothing that people were
just retiring. They wanted to move away. I didn't know what interest rates
were then. I wasn't in the business, right all. I looked at,
hey, what's the payment going to be? What can I afford?
Right? Every single month? Can I afford to buying this house? It
was a single family house. I wanted to move into it, right.
I did the math, and I knew based off of how I was living
at that point, I was like, Wow, can't afford that payment?
Taxes were astronomical? Right, obviously that's maybe my house was so cheap.
That same house had I bought it from one nine team, right, I
know that neighborhood. It was in the Roselle Park in New Jersey, Okay,
that house would be well over five hundred thousand dollars if not more.
It was massive, right split level pulled the homeline for that price, then
I would have made a ton of money on it. I didn't need to
put a penny in outside of just make my payments. Right. But if
I was only making my payments from that point till now, I'd probably all
had fifty grand, sixty grand, if you know, maybe a little bit
more. But you know, it was it's it's nothing and all that money
that I could just have put in my pocket, and I bought it and
sold it now and moved into somebody else, right right, So it's I
again at that time, to me, I'm kicking myself in a butt because
I made a massive mistake in not buying it. Right. I was being
greedy. I was saying, well, half to go out, you know,
I have to do X, Y and Z. It was all like
how else can I blow my money versus, hey, let me actually just
invest it into this, right. I think people really need to sit like
and assess what they really want to do. If they if they really want
to buy a house, they need to sit down, get pre approved,
get out there submitting offer fixe something they like, right do you? Just
time is not on our side, especially when there's just so few houses for
sale, right right. Well, I'm excited for the market either way.
I mean, if the prices you're up, I'm excited to work with investors.
If the prices stay the same, we're keep increasing and the market is
busy, I'm happy to continue working with buyers and sellers. I was listening
to one thing that you were saying, and I know that you know,
depending on how long you're going to be in at home, sometimes it makes
more sense to rent. Obviously, you have to look at your savings,
what you're qualified for in all those things. What do you think about investing
in a multi family right where you have one vacancy, you occupy that vacancy,
you have the other two the other two apartments two or three or even
one helping to carry the mortgage, and after you're in the house for about
a year or two, you then go ahead and rent it out or you
rent it your Honestly, I think I think that's genius right for everybody to
do. However, the the analogy I was using was, Hey, if
you're looking for a single family home, right, I was just feeling,
you don't want to be a landlord and or any of this. If you
are looking and you're open to becoming an investor, right, then that is
that is to go about it absolutely, because you can buy with three and
a half percent, then if you don't want anything else, right, up
to four units even makes use, you know, if it's more residential than
than commercial. However, let's just say you're buying a three or four family
house. For the most part, especially when it comes to FHA as well,
they do the self sufficiency test, which is what I was talking about
earlier, where the house has to technically, right three out of the four
units at seventy five percent rents or technically, let's say three out of four
if they're rented, they have to cover the entire mortgage, meaning once you
do move out, if you change nothing about your mortgage, you never even
refinance. Technically, that unit that you were occupied should just be money you
pocket, right by their own rules. So they're already setting you up to
technically become an investor, to become an investor. I was just going to
say that, that's so there're preparing people they you know, for that,
and I think everyone thinks too deep, you know, like or too far
out. You have to you should put money to the side all the time.
You should always have savings right no matter what, no matter whether you're
rent or buy whatever. If something breaks, great, your landlord, you
fix it, right, that's right, you put money to the siphone,
you have savings. Right. However, let's say you buy that house,
you do whatever you need to do it. Yes, you're one you not
might not be making money on it, but don't forget you are paying on
any mortgage. Right. You're also utilizing the interest on your mortgage against your
taxes, so you're gonna get hopefully a little bit more money back. And
he repairs or anything you put onto that house. It's a multi family right
to write that off in your schedule lead right. This is more for like
accountants to explain to the to the to the homeowner. However, those are
things that will help you out, and then you turn around and you rent
it out and you can move somewhere else. Now you can end up truly
living for free and pocketing that difference. So you either could put that money
into your pocket or you can use it to pay something else. You're letting
your assets basically offset something else for you. You're able to do that the
right way. You can easily have Let's say you could do it for three
two so seven nine units and then end up living in ten units and end
up buying the two family wherever you want to end up living long term within
like a five year period, right, because it takes time to find it,
to buy it, to move into it, to move out, to
rent it out, to do it again. All of this takes time.
Nothing is overnight. But imagine you have ten units paying you, right you
if you know, seventy five percent of all of those are all paying the
mortgage and the rest is just you know, left to you. Always remember
that part of that mortgage payment that the other rentals are paying is still money
in your pocket. You're paying down your debt. You know, your net
worth is just constantly increasing, right, you know. Right, So now
I'm a buyer and after listening to our amazing conversation today, I want to
purchase or I want to invest, Like, what is what does that preapproval
process look like? It's so dawn to so many people. People get discouraged.
They're afraid to submit their documents, they're afraid of the answer they're going
to get. They you know, they drag their feet some people, and
then you have others that are willing to cooperate. But what does that process
look like. For if I want to purchase a single family home versus a
multifamily home, Like, how can you preapprove me for that? What do
I need to give you? What does that look like? What does it
mean? What's the difference between single family and multifamily preapprovals? Yeah? Simple?
Right? So every bank and every young writer wants to see two years
of tax returns, and that is to show that, hey, you have
been consistent employee. You can change jobs, that doesn't matter. You can
you change fifteen different jobs. You change fifteen different jobs. Right. Then
they want to see your current pace stops one month of your most recent job
wherever you're working now, we want to see that assets, right, bank
statements, So we want to know how much tame you put down and how
much do you have for close costs? Do we need to get a seller's
credit to help you offset one or the other? Right? Um? And
the last thing is ideas, right, like a driver's license, so that
you know so you are who you are. Once you have all of those,
then we put everything together, put a loan application together. It's not
we're not going to actually go through with everything. We're going to run it
through desktop on the writer, which is Fannie MAE guidelines. Basically they check
everything off and say, hey, this person's approved for this type of mortgage.
Um. Once all that's done, you're technically preapproved. Right, We're
going to check your credit obviously if we want to know, and we're one,
what your credit score is and how much liabilities do you have. The
reason I keep saying that people need to really, you know, figure out
what payment they're comfortable with is banks. Banks are underwriters and everybody they're like
computers, right, so they work off everything with ratios and numbers. Right,
So we want to be we want to have a debt to income really
short, a certain percentage that gets you approved. Now I can maximize that,
right, But if I maximize that number, I could put you in
a position where, hey, now I'm struggling in every single month, right
because I bring in five thousand dollars and twenty five hundreds out the window.
Realistically, I'm only bringing you know, let's say three thousand or thirty five
hundred half to taxes. But that one thousand difference we're not taking into account
you know, utilities and other things. So that's why knowing what your payment
is going to be approximately is a massive health if you get pre approved for
a specific amount for a single family house. Right. When you look at
multifamilies, we can count the additional rental income that you're getting up to seventy
five percent of each unit, right to help you qualify for more money.
Right, So that's where the difference between a single family or a multi family
pre approval comes in. Then for fah there are limits, right, so
how much you can finance, And in areas we don't really run into that
issue a lot in the Tristate area because it's all high income or high high
value areas, so those limits are pretty high, right, they're set at
the maximum. But other areas you have those issues. Right at a client
that was purchasing in Upstate New York. Right upstate in New York is not
far technically it is right north of the Bronx, but like Pass plus just
the pass halways, And the issue we constantly kept running into is because he
was using fah A to purchase a single family home and the limit at that
time was actually very low, and it was like three hundred and change thousand
in that area, right, So he had to come up with the difference.
Make sure the loan amount is below with that limit. Right. So
these are things that most people don't know or they don't know if they qualify
for. So that's why when they sit down and they send all their documents,
we can get everything done for them. Then they can start shopping.
If they see I talk to the clients that I preapproved. Sometimes it's multiple
times a week. Right, they'll shoot me attacks, Hey, i'm looking.
I just looked at this sounds I really liked it. Great. Here
your numbers, This is what I want to offer X, Y, and
z based off of whatever today's rates are. Here's what you know your payment
is going to be approximately. It makes it so much easier for them to
make that offer, right, because now I know I'm gonna pay three thousand
dollars a month. Great, I'm comfortable with that. Fine, I can
make this offer. I'm gonna pay forty five hundred dollars a month. Wait,
maybe that's a little too high for me, even if I qualify for
it. Right, So it just makes it makes it much more real for
them. Right, It's not a daunting experience. We don't want to like.
I try to make it as easy for everyone I even send them like
a link. I'm like, hey, if you want to make it quicker
and easier, you can answer these questions if you're more comfortable, right,
But if not, get on the phone with me and I'll go through every
single step that we need to do and then what they're actually you know,
pre approved for, and then they can start shopping every they see that the
house. You want to make an offer, we need to update the pre
approval. We can do it so much easier because I have everything already set
up from them. You need that listening agent to you know, sweeten the
deal and say, hey, listen, this is what we've done for this
client. There's so much more comfortable, you know, and they might consider
that offer over somebody else's, mainly because they know you've done all your steps
already. You know, they know you've checked, they know you're truly pre
approved, right, and you can get into this house within the next two
to four weeks. That's amazing, you know, like you're buying a whole
house and it's gonna you know, it's gonna take two weeks. That's that
wasn't the thing? Yeah, No, for sure, I mean definitely a
mouthful of information. Um, I think it's really important for everybody to know
what they're doing, if they're going to invest in real estate, why it's
important to get pre approved, why it's important to get pre approved now,
and what that process looks like. So that's everything that we talked about today
for the most part. There's there's obviously, you know, other other things
that go into making a purchase. And if there's any specific questions that anybody
has, I myself, I'm a New Jersey realtor. I'm also licensed in
New York and license in Texas. If there's any questions that anybody has about
real estate, you know on that side, please let me know. And
then, my friends, I want you to reintroduce yourself to everybody. I
want them to know who you are. I want them to know where to
find you, and I want them to know that they can come to you
with any questions when it comes to getting pre approved. Yeah. Absolutely so.
My full name is Zambiakai and I think they see it here, Yes,
in the right direction. You can find me on Instagram. Like you
said, I do post. I do post a lot of good informational content,
or at least I try to. You can also call me directly three
four seven four one seven four eight one six that's my cell phone, Shoot
me a text, give me a call, whatever it's easier for you,
and I'll be more than happy to go over every single you know option that
you have. I am licensed in New York, New Jersey, Connecticut,
PA, Texas, Florida, and I think a bunch of other states that
I can't remember off the top of my head book for the majority of the
part of those, that's that's where I'm I'm much more active, um or
at least that's where a lot of my clients are. But um yeah,
I feel free to reach out. Instagram works great too. I feel like
I'm addicted to that school. If y'all have not checked out his Instagram,
listen, I remember when you started like on Instagram, and oh my gosh,
like the content that you that you post now is like so amazing,
it's it's ready, thank you great. And that's the other side of your
personality too, Like he's a he's a very fun guy. Like you have
to you have to check out his Instagram so you could see all the useful
information he posts and all the creative things that he comes up with. I
think it's absolutely amazing what you're doing, UM, and I'm going to start
for posting your content a lot more because it's very informational, it's funny,
it's entertaining. I love it. It's so it's great. It's always great
talking to you and you know, doing business with you. And I want
everybody to have the same experience that we have had, you know, working
together, So come on, everybody, work with us. Thank you so
much for tuning in. We really appreciate you. We are live every month,
typically the second week of the month, we go live and we bring
really important topics to you about real estate and mortgage lending and what that process
looks like. And we're always here to answer any questions that you have as
well, So thank you for tuning in. UM. Make sure that you're
following me on Instagram. As a matter of fact, I'm going to update
my name here to my Instagram so everybody knows where to find me. Make
sure you keep following my instagram for more information on when we'll be on next.
And thank you everybody for tuning in. And no matter what you do,
matter where you are, no matter where you go, just make sure
you go where you can grow