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The Yi Team Home Loans

Mortgage Experts in Rockville, MD

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Biggest Bang For Your Buck

Coffee & Jam Podcast with Erin Finke and Alex Ross

We’re talking about how to get the biggest bang for your buck with pools, playgrounds, kitchens and bathrooms.

 

ERIN Hey!

ALEX It’s Thursday. We’re now going to switch to Thursday. Every Thursday look for a new recording. Today’s topic is Biggest Bang For Your Buck.

ERIN And it started with adding a pool, because it’s that time of year! It’s that time of year where it’s pool time. Do you have a pool in your community?

ALEX No, not yet. They haven’t built it yet.

ERIN But they will?

ALEX They will. It’s a whole community center. Right now they let you use the apartment complex. You have to get approved. But we belong to Lifetime. So if we really wanted to go to the pool, they have a pool. We just go to Lifetime Fitness. Not a big deal.

ERIN Let me think about this, because we have two pools in our community and my community isn’t set up for backyard swimming pools. I think the idea of our topic today is what can you add to your home to add value. Is there, are there things that you shouldn’t do? Are there things that you should do? Based on the biggest return on your investment is going to be? So, Alex, I think you’re going to speak to the largest part of this, like market values and being able to invest. You are very, very, very versed in developers,

ALEX Pools.

ERIN Well, pools too. But developers and materials, what materials yield as far as return on your investment. I think that’s a good place to start.

ALEX Can you tell I’m, off topic, obsessed with this?

ERIN Yeah, and I’m obsessed with your nails too. Those are a cute color. You guys can’t see but it’s like a metallic white. An opal. An opal.

ALEX My Chapstick, no, I don’t think it’s Chapstick. What do you call this?

ERIN Can I smell it?

ALEX Yeah, lip balm?

ERIN It’s Eos.

ALEX It’s Eos. It’s Dunkin Donut

ERIN Oh Lord. I would eat that. I would lick my lips all day long.

ALEX It’s kinda funny I bought it and it smells like glazed donuts.

ERIN And you’ve put it on your lips literally 4 times since we’ve sat here and you’re licking you lips.

ALEX Because I can’t eat glazed donuts at Dunkin Donuts since they’re non-vegan. Therefore I have to find alternatives and this one is close.

ERIN So you’re satisfying your sweet tooth without…?

ALEX It’s so bad, it’s so bad.

BIGGEST BANG FOR YOUR BUCK

ALEX Okay, yeah. Biggest Bang For Your Buck. We can break it down by topics. Okay? So Pool.

POOLS

ERIN Yeah. Let me ask you a blanket question first. If you have a half acre lot, so a decent sized back yard, and you were to put a pool on half of it? So you still have green space. It would be a smaller pool to be able to do that. If you were to do that and still keep some green space would you be taking away from your home value because you don’t have the green space or do you think you’d be adding to the value because you’re adding that ammenity?

ALEX I’m biased. I always love a good pool. Obviously don’t put it on a postage stamp lot. I love a good pool. I don’t think it takes away from it. Do you ever look at backyards and think it’s missing something?

ERIN Yeah, like “oh a pool would look great right there”.

ALEX Barbeque, pool, whatever it may be. I think with a pool it lends itself to other options you might do. You can do a patio, a green space next to it for your kids, or dog, or a playground off of it. You can do a barbeque. What do you call it, not a gazebo, but a big

ERIN Like a big *snap* whatever this motion equals. Like a fireplace, that’s what I’m thinking.

ALEX It adds value. Because if you extend your indoors to your outdoors and make it another living space outside that you can use, theoretically 8 to 10 months out of the year, you’re creating more value.

ERIN Now, could that be subjective?

ALEX Absolutely! Some people don’t want to be outside. I’m showing houses now and people are like “no, it’s too much yard. It’s too much green space. It’s too, what am I gonna do with this?”.

ERIN Who are they?!

ALEX I’m gonna have to cut all this lawn, that’s the other thing.

ERIN Especially about a pool. The upkeep. The cost of maintenance.

ALEX The upkeep is actually less than having to mow your lawn.

ERIN What?

ALEX Yeah. If you get a good pool…I wouldn’t do salt water, by the way, if you have dogs. If you have animals and they drink the water it’s not good for them. So you could do a freshwater pool instead of a chlorine pool. And it’s once a week maintenance. If you have a vacuum and you already have a system that runs it and everything. My parents have one and once a week.

ERIN I still need to go to their house and see their renovation.

ALEX And I grew up with one and it was once a week. You have to check the skimmer.

ERIN What about adding a pool? What’s the cost? There are some myths out there that say if it costs me $45,000 to add a swimming pool then that adds $45,000 to my home value.

ALEX No, because it could also go the other way. It’s a gamble. It’s truly like we’re in Las Vegas, we’re going to roll the dice down the table and hoping we’re going to land on whatever number.

ERIN If you’re adding a pool it’s because you want it and it’s something of value to you, not because you’re trying to attract value.

ALEX It depends on where you live. If you live on a little bit of land then it adds value in my opinion. Because no one wants this big open space, they want something more. If all your neighbors have pools and you don’t, then sure. I think it would decrease the value of your home.

ERIN Only because there are no comps to support the value.

ALEX Correct. And if you are the one of only a couple on the street. Great. Then you’re house is only going to stick out more. If you’re the only one in the surrounding area it may not serve a purpose.

ERIN You don’t ever want to be the most expensive investment on the block.

ALEX Correct. Now obviously, different location, if they’re in Florida, everyone has one. It’s almost expected.

ERIN Right. It’s almost like where the hell is the pool if it’s not in the backyard when they get there.

ALEX Pools now you can use 7 months out of the year. My parents open theirs in April and close in October. Because it’s heated.

ERIN Right!

ALEX If you have solar panels you can run the heater off solar. It’s really not that much more a month to be quite honest.

ERIN I just know nothing about pools, pool maintenance.

ALEX It’s a misconception that it requires so much maintenance.

ERIN Literally, here I am coming in to this and I’m like oh my god it’s so expensive.

ALEX It’s not at all.

ERIN So what kind of mechanics go in to a pool? Like you said, a filter.

ALEX The pump, the heating. And then you have to get these jets that push the water around and it has a vacuum underneath. So it constantly is cycling the water as opposed to just sitting there. You have to check the skimmer, you’re going to find some dead things every now and then. For the most part you get algae problems you can scrub it.

ERIN And the little vacuums that run around the bottom.

ALEX It’s not like you’re out there for hours. I used to do it and it takes literally 5 minutes to go around the whole edge of the pool and scrub it if you want. You’re not sitting there with Clorox bleach, you’re just scrubbing.

ALEX My parents years ago tried to sell their house without the pool. Then my mom is like “forget it, we’re going to stay. We’re going to give up the membership at the country club and we’re going to put a pool in”. They put a pool in and when they went to sell it years later, they sold it within 4 days. Because of the pool. The house is on four acres. It just screamed “pool”. Now, I think having a pool in Bethesda is helpful too. In parts of Bethesda, there is just so much inventory out there. You’re not going to want to put one in in Clarksburg really, or Villages of Urbana. Some people in Kentlands have them.

ERIN You know I saw a property just recently that had a pool on the deck.

ALEX It’s on Masbury?

ERIN No I think it’s on Chestertown. But obviously you CAN do it, and it looked really nice! It was actually quite shocking. It looked very spa-like. It was a lap pool or it wasn’t a dive pool. It looked like a pool that you would truly only do swimming in it. What do you call that?

ALEX A wade pool. No, lap lane.

ERIN A lap lane, but a shorter one with the jets.

ALEX Like a wade pool. So we have a listing and I don’t know why they did this. It’s in DC. You wouldn’t expect it has an indoor pool but it has one of those what you’re talking about. It has where you’re swimming in place.

ERIN Like a treadmill.

ALEX They have that off their living room. It looks horrible. But, it’s under contract.

ERIN Someone liked it. That’s all that matters.

ALEX What’s the next topic?

ERIN As far as improvements. We talked about poo, what about repainting your house? Or getting new shutters?

ALEX I think that’s all great, depending on the color you’re going to choose.

ERIN Let’s assume that you don’t have an HOA that you have to contend with. What should be the inspiration behind the color, or any changes you’re going to make to your house? For example, when I was a child I wanted to match my makeup to my outfit.

ALEX So you wanted to be pink and purple.

ERIN But remember, that you’re not supposed to do that. I learned that your makeup should compliment your features, not what you’re wearing.

ALEX So you wanted blue eye shadow, blue shirt?

ERIN Exactly. As an adolescent. So my point is you want to accentuate the features of the house itself.

ALEX I think you can be quirky if you’re going…for example. Downtown Frederick. Annapolis. I think you can be quirky.

ERIN Oh yeah. But that’s not typical though.

ALEX I think around here you have to look at the architectural style of the home and get the feel of what it is. Is my house traditional? Is my house a little more modern? If so I always like to stick with classic colors. I like black and white, I like earth tones, I like black shutters, if you want to reverse it.

ERIN I love brick with black shutters. So good.

ALEX I’ve seen which looks really cool but is a little too forward now it’s more DC is matte black brick and white shutters.

ERIN Oh my gosh.

ALEX Or matte black brick, black lacquer shutters.

ERIN Wow! That’s modern.

ALEX I’m look at your marketing piece. If you wanted to paint that brick for example. The brick is this orange color on their marketing piece. It’s this house.

ERIN It’s a brick red.

ALEX It’s a brick red. If you wanted to switch it, I would say to keep the value of your home. Say someone wanted to paint their brick white I would keep your door white or a darker color and your shutters I would do black.

ERIN Do you think you should paint brick?

ALEX People love to. My sister did.

ERIN I think it can look great but…

ALEX It requires maintenance though.

ERIN Yes. So you can see that in downtown Frederick or even Annapolis where the line of the house. Because remember it’s all flat because it’s a rowhouse.

ALEX Annapolis is even worse because of the moisture and the salt water.

ERIN Do you think that the value? You’re giving your home great curb appeal obviously by updating the outside appearance. But if you’re spending $10,000 having your house repainted, as a reminder, you’re not going to get an extra $10,000 in your value because that’s a maintenance thing. That’s not a value thing.

ALEX I think it’s just a “I want to paint it while I live here because I love the way it looks”.

ERIN You love the way it looks driving up to it. So to touch on things that are Biggest Bang For Your Buck, let’s talk about Kitchens and Bathrooms.

KITCHENS AND BATHROOMS

ERIN I know you love those!

ALEX I do.

ERIN You can put money into your kitchen and actually double your investment.

ALEX You can do small things that will double your investment. Say you don’t want to rip out all of your cabinets. Your cabinets in general are in great shape. I would recommend to have them professionally painted on the inside, or refinished on the inside. Get new doors, facing, on the front. Like if it had an inlay in it and you wanted flat. But I wouldn’t do it yourself. I’ve seen a lot of cheap ones. You have to do it the right way. You have to sand it.

ERIN It is a long process. We looked into this in our other home. The same idea. To rip everything out would be very expensive. It would have looked great. But to have them refaced was a 4 day process. It was a long time.

ALEX It is, but it’s less than having to sit through construction. At the same time you can rip up your countertops. I always recommend if you have the space, a waterfall countertop.

ERIN Beautiful. I’ve seen it a lot more lately and it’s gorgeous.

ALEX Its a little bit extra. Make it thicker, don’t make it thin. I think that’s big. Lighting is another thing. Lighting is where you should spend your money in kitchens.

ERIN Really?

ALEX I think so. If you have a beautiful kitchen but it’s dark …?

ERIN Like under cabinet lighting, and above cabinet lighting.

ALEX Above cabinet lighting, under cabinet lighting, recessed lighting.

ERIN You have white cabinets, right?

ALEX Yea, I have them all the way to the ceiling. That’s my pet peeve by the way. I do not want cabinets that do not go all the way to the ceiling. They have to go to the ceiling because I don’t want to know there’s dust up there.

ERIN Oh, I never thought about that. Now I’m going to go home and wonder what’s up there? But if you have 12′ ceilings?

ALEX Then you should do it. Even if you have 10′. I have true 10′ ceilings. Not builder 10′, true 10′. And with that I have my cabinets to the top. I know there’s never going to be dust.

ERIN I’m going to have to find a picture now of my kitchen, because I don’t even know.

ALEX So these are the things you could do. I always believe that a good backsplash helps. Don’t have it too busy. Don’t have it look generic. Don’t go to Home Depot and pick the glass tile and throw it on up.

ERIN Oh, I see. Like not the one that’s already a piece. Do you know what I’m talking about?

ALEX Yeah, don’t pick the ones that you see too often. If you’re going to do it, do something that compliments not something that takes away. And that’s the same thing for bathrooms. Bathrooms, what people look for are now toilets, new vanities, make sure your tile is updated.  The other thing about outside is playgrounds. Some people don’t want them.

ERIN That’s a good point.

ALEX Some people don’t want them. Either way it costs money to move it or to remove it.

ERIN So would you say that maybe you don’t want to do that?

ALEX If you’re going to do those kinds of things then you have to commit to it all the way. Be prepared. You need to hone in on who your buyer is going to be, that you’re so confident with your selections. When time comes to move you know this is who I’m already looking for.

ERIN You want to keep your demographic pretty big. You don’t want to narrow it down to, it’s just a family that’s going to buy my house. What if it’s not a family? What if it’s a retired couple who’s kids are grown?

ALEX I don’t think they’re going to have a giant playground because a retired couple are usually looking for something smaller.

ERIN Maybe. But you’re eliminating.

ALEX You are, but that’s okay though. You just need to know that. I always believe that if you’re going to do things you have to do it all the way. So playgrounds, don’t just throw a playground on top of grass. Throw it on top of turf, maybe box it in.

ERIN Sand.

ALEX Whatever it may be, woodchips. Make it a piece of the house, not an afterthought.

ERIN I see. So it’s not something you threw on top of something else. It’s a dedicated space.

ALEX Everything should have purpose. Same thing goes for furniture. It shouldn’t look like you had extra furniture lying around and you didn’t know what to do. Every piece needs to have a place in the house. And don’t over clutter. I hate tables.

ERIN What I see some of these listings that incredibly cluttered. And I don’t know what it is. For example, the other day I was watching Keeping Up With The Kardashians. My husband walked in. At that moment someone was walking in to Scott Septics home which is this very sprawling, beautiful home. Beautiful white-washed floors, dark railings, beautiful, white. It’s very very minimal. So minimal. And Darick’s like why do these people have these huge homes with no furniture. I was like, oh my god, I looooove it!

ALEX Yes!

ERIN I love having so much clean space and so many corners that I can see. That’s what I like.

ALEX That’s the style, that’s the look for the home.

ERIN It’s very chunky almost. All the pieces are very big. Like banisters.

ALEX That’s how our house is. I’ll have to have you over. Our couch is this big piece, but we have nothing around it.

ERIN Around the perimeter. I’m with that.

ALEX I think if you’re going to do big pieces, you need to have less of them. Like what you were saying in the show. I love it. Because you’re house speaks. You’re actually showcasing the house.

ERIN You’re showcasing your home. Whereas your center island is a huge piece itself. And the windows.

ALEX It’s like art. Your house should be like art.

ERIN What pleases you. What sparks joy as they say.

ALEX No one likes a very overcrowded painting.

ERIN Yeah, I have some pretty stark walls and I’m okay with that. I think I’m going to do a gallery at one point. Up the stairway. Literally we’ve been in our house 2 years and I can’t. I need to find one piece that I like, and start there and build around it.

ALEX To wrap it all up, if you’re going to do things: kitchen, pool, playground, bathroom.

ERIN Don’t be too impulsive. Figure out what you’re going to do and invest some real time into dedicating that space and make it beautiful.

ALEX Yes.

ERIN Not just for you, but for the future.

ALEX Like you said, do the research with the right contractors. With the right companies. Look at photos online. See what the trend is in your neighborhood. Are you going to stick out too much with these items? You don’t want to always be the one house that,

ERIN The nicest.

ALEX Not the nicest. But the one house that’s going to be hard to sell because it’s so out of place.

ERIN When I say nicest I mean you don’t want to completely comp out of your neighborhood. If you plan to make a huge sprawling swimming pool and there’s not a swimming pool three miles around you, you’re going to have a hard time keeping that value.

ALEX You’re going to have a hard time. There’s no demand for it.

ERIN Exactly. So you can make that investment and enjoy it. Get the biggest bang for your buck.

 

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Stay updated on Stitcher, Coffee & Jam 

Recession is Time For A Deal

Recessions Are A Good Time To Refi Or Purchase A Home Mortgage Monday WUSA9

Do you see a recession in our future? Now is a good time to take advantage with a refinance or home purchase.

GDW Did you ever wonder what would happen if we enter a recession over the next year? Well today on Mortgage Monday we learn how an economic slow down may not hurt your pocketbook as much as you might think.

GDW I like the sound of that. And here with more of that is Chong Yi of The Yi Team at Fairway Independent Mortgage Corporation. Welcome back.

CHONG Hey, thank you.

GDW That’s good news that we can take advantage if we get into a recession. But where are we right now with the economy?

CHONG So I was a little concerned about this because when I was talking to my girlfriend Lorraine, better half, life partner. I said we were going to talk about recessions, inflation, inverted yield curve, and all that good stuff.  And she said, “are you sure”? Because it’s really boring and I hope that I don’t bore anyone here. However, it’s important.

GDW It’s important.

CHONG Whenever we hear stuff like recession people freak out. Do we truly know what it means? The true definition of recession is two straight quarters of slowing economic growth. So what does that really mean? It means less money is being pumped into the economy and that causes it. It doesn’t necessarily mean doom and gloom for all of us. Let’s first talk about what a recession is and what drives it and what drives interest rates. What drives interest rates is inflation. The higher the rate of inflation means there’s more dollars chasing less product. Which means it becomes more costly to buy stuff and there’s less stuff out there to buy. Boring as heck.

“A recession is 2 straight quarters of slowing economic growth.”

CHONG So what does that mean? It means that it drives to recessions. Recessions means that, we talked about the definition. In actuality it’s a good thing.

GDW How is the recession a good thing? People live through the great recession a few years ago and maybe they remember the recession from the early 90’s. What’s in it for people to look at it head on and say I can get something out of this.

CHONG Two things really happen. Let’s talk about how and why. So two things happen. 1) interest rates go down lower. 2) Housing becomes more affordable. Clearly, lower interest rates and more affordable housing means more people are going to buy and values are going to go up. That’s the good part about it.

CHONG Now let’s talk about why it gets there. I talked about an inverted yield curve. All that means is that there is as much money to be made on a long term treasury as there is on a short term treasury, which isn’t good. You know when you start to get sick you get the sniffles. When you see, and this is where it’s going to get boring. When you start sniffling it’s a sign of something bad is going to happen. When you have a high, like a 10 year treasury that’s lower, it means there’s something bad going on.

GDW It’s a precursor.

CHONG What the Fed should do is raise short term rates to reduce short term rates. We have some charts here. I can barely see them, but that’s exactly what we’re talking about.

GDW 10 year treasury yield. That’s what you’re talking about.

CHONG That’s what I’m talking about. So there’s a “sickness” in our economy and that’s where our federal reserve needs to reduce rates not raise rates. So what does that mean going back? The true indicator of a recession ties directly with unemployment. What do I mean by that? We’ve talking about how unemployment has been really low.

“The true indicator of a recession ties directly with unemployment.”

GDW Right. Here’s an unemployment chart.

CHONG Throughout history when unemployment gets to it’s lowest point and it starts to rise, that’s when a recession starts to happen. It’s happened throughout history. Let’s say people are getting hired. You get jobs, unemployment is low.  So you’re pumping money into the economy. Yayy! Everything is great. Right? People are buying more stuff. The economy is great. Well, if it starts to slow down a little bit, and people start to get laid off.

GDW Last in, first out.

CHONG Correct! So when the unemployment starts to go back up, what happens? The people who were pumping money into the economy…

GDW The people no longer have that money to pump in.

CHONG That’s right. Do you want to go out and have that expensive dinner or do you want to save it for a rainy day? And that causes deflation. Totally different conversation. However, it’s a great trigger. The real negative on the recession is how it’s going to effect your stock prices. If you’re continuously investing dollar cost averaging over time it’s going to offset. The best part about it, interest rates are lower so what you can buy today is going to be less expensive tomorrow so you can buy more house. If there are more people buying, housing values go up.

GDW Right, so there’s more competition. It’s always a good time to buy a house you say. The state we’re in right now, what’s the interest rate right now?

CHONG We’re in the higher 3%.

GDW That’s great!

CHONG That’s awesome! So if you want to refinance, give me a call.

GDW Can it go down even more?

CHONG It can. We’re not even into the true recessionary period right now and we’re talking about mid to low 3%. So I had this conversation with a lot of my clients and they say “then I should just wait.” And I say if you wait, interest rates are low. There’s no way you can find the best time. But if it goes low and you want to buy something, the price of the house could be 10-15% higher.

GDW The big thing here is we’re not headed to another Great Recession, right? This is just another cycle in the economy where things slow down. If people are fortunate enough to hold on to their jobs and they’re ready and fit for a mortgage they are going to get  deal.

CHONG That’s right.

GDW Thanks so much Chong for that information.

GDW Thank you. Now is the time as you head to refinance or purchase that home that you have been looking at.

Are you ready to take advantage of a recession? Click here to get started.

Get the latest update on mortgages on our Facebook Page.

 

 

Human Connection

Coffee & Jam Podcast with Erin Finke and Alex Ross

The human connection, a vulnerable conversation about the roller coaster of purchasing and selling a home, that everyone goes through.

Erin Hello everyone! Episode 2. Coffee & Jam with Alexandra Ross and Erin Finke. It’s a beautiful Monday afternoon. Getting a little warmer here in the DMV.

Alex I know. Maybe we’ll have to change it to margaritas and jam!

 

HOME BUYING IS EMOTIONAL

Erin That’s a great idea. Margaritas & Jam, I love it. Today we’re talking about having a real conversation about how this experience in buying real estate can be daunting.

Alex Emotional.

Erin Real emotional. We as professionals can be desensitized, because we have this conversation every single day. I think about that a lot. We talked about how I talk fast. Sometimes I find myself in a conversation with a borrower and go, let me just slow down. I forget that I have the same conversation every day and you don’t.

Alex Do you ever feel like it’s easy to tell people what to do. In the sense that it’s like the same thing over and over? I think that’s why it takes the emotion out.

Erin Exactly. But that’s a good thing, right? It’s a good thing to know that you’re working with a professional that’s not emotional regarding to each step of the transaction. However, it doesn’t humanize you. And you need to relate to your client, understand and empathize with your client and know what they’re going through. I know you’ve experienced and I’ve experienced. The human connection.

 

CASE STUDY – ERIN BUYS A NEW HOME

Alex Tell about when you got your house and how long ago that was.

Erin So I bought my very first house in 2011. Living with my parents before that, so just buying. I did buy a short sale, so it took a while.

Alex By choice? You just found this house and all of a sudden you’re like this is the one.

Erin We looked at a lot of houses and the one that we wanted ended up being a short sale. Not a huge deal. For those of you who don’t know what a short sale is, it’s when a property is being sold for less than what is currently owed on it. So the bank that owns the mortgage currently has to agree to take less. So that takes time. Attorneys are involved and they have to negotiate. [RESOURCES]

 

“A Short Sale is when a property is being sold for less that what is currently owned on it.”

 

Alex And this is in 2011? Before or after September?

Erin After. I went under contract in May and we didn’t close until the day before Thanksgiving.

Alex I feel like everything holds it then.

Erin There were a lot of short sales and foreclosures back then. I remember being a little intimidated by the process but I had been in the business for 2 years by then already and I wasn’t juggling anything else at that time. Fast forward to 2017 when I bought our current home and we sold and bought at the same time. Holy crap! I was completely unaware of everything.

Alex Did you have settlement the same day?

Erin I didn’t. Fortunately I did have a rent back. So the timing worked out perfectly. I will, every person I talk to about when we sold our first home and bought our second home it could not have gone better, the timing. We did new construction. We went under contract in October and it wasn’t delivered until May. 2016 I went under contract. 2017 in May it was delivered. But I put our house on the market the first week of March. Literally this week 2 years ago. So the first week and half of March.

Alex Were you anxious?

Erin I was terribly anxious because I didn’t have to sell my home to buy my next one, but I didn’t want 2 mortgages. And I also had an 18 month old at the time.

Alex So you had a lot going on at the time.

Erin A lot of layers. And I remember feeling incredibly uncomfortable when here I am in the mortgage business for so long. And why am I uncomfortable, I should know. Because it’s emotional! It’s an emotional thing!

Alex It is! I don’t care what price point you’re buying by the way. It doesn’t matter.

Erin It doesn’t matter. So whether you’re buying your first home, or your juggling selling your first home and buying your second home, it’s important to be reminded that this is an emotional thing. Investing in real estate is great as an investment, but it is where you’re going to live. We’re talking about a primary residence. So yes, I remember being humbled by that, and thinking, damn, this is what I talk our clients through every day.

Alex Who is talking you through it?

Erin I don’t know. Happy hour? I think it was Clyde’s Tower Oaks talking me through it.

Alex What pep talk did you give yourself?

Erin There was a lot of wine and a lot of vodka.

Alex Did you cry?

Erin I cried a lot.

Alex I feel like I can relate. For those of you who don’t know Chong, we’ll have to put up a photo of Chong and what he does.

Erin I’ll have to put up a picture.

Alex Haha! He’s running away! We’re in a conference room and it’s glass doors and glass walls. He’s gone.

 

THE LARGEST PURCHASE YOU’LL EVER MAKE

Erin To the point of having a real conversation on real estate, it’s not just facts. It’s not just what loan programs are out there. How much can I afford? How much down payment do I need? Lets talk about you emotional state. And what to expect through the process and what is normal. Guys, this is normal to feel this way. Any large purchase is exciting.

Alex It’s usually the largest purchase you’ll ever make.

Erin It’s more than likely the largest indebtedness that anyone will ever make. It’s not just a car, it’s your home! It’s an appreciating asset. There’s all these layers to it. But it’s a really interesting thing to be reminded of. It’s a lot easier to give someone direction than to take direction.

 

A home purchase is “more than likely the largest indebtedness anyone will ever make.” 

 

CASE STUDY – ALEX BUILDS HER FINANCIAL STANDING

Alex How many times have I told people what to do? And how to do it? And here I am, I basically did the opposite of what. For me, Erin and Chong are doing my loan. I’m a first time home buyer.

Erin Which I completely forgot. It’s a stigma of being in the business that you own so much.

Alex That I own so much. That’s a whole other topic. It’s the persona I give out there. You would think I own multiple properties. Now I’ve done transactions with multiple properties and my name is on it. But we never end up buying it, we’re flipping the contract. So I never had any emotion attached to it. What started to get me wasn’t the actual purchase, it was the “okay now I have to give you all of the paperwork”. It was the bullshit that everyone has to go through. And then I started to relate to my buyers on it.

Erin Why is it taking so long to get me your bank statements?! It’s a pain in the neck, I get it.

Alex I was just having this strange Friday. And then I got everything in to you, and your underwriter emailed me 10 things I wanted to cry. I was like “why”? And then I have this fear which I’m sure is normal, that it won’t get approved.

Erin It’s funny that you say that Alex, because I’ve been in this business for 10 years now and that’s how I felt. I’m like, this is what’s going to happen and my loan is going to be declined. I know everything that can go wrong. I was telling myself that something was going to happen.

Alex I know! I already have a back up plan in my head because that’s the kind of agent I am. If something doesn’t happen for a client then I already know how I’m going to help them. So I was talking to Josh, “if we don’t get approved, what’s going to happen”? He said, “you’ll be approved”.

Erin To your point, it’s totally natural to feel that way. It makes you a human. It doesn’t matter how long, maybe it has to do with the fact that I’m a woman and I worry a lot, because my husband was like, “huh? You’re worried”?

Alex Has he bought a house? See, Josh has already bought a place before. But he’s never bought a place of this caliber.

Erin But he’s been through the process.

Alex Right, he’s been through the process. But he went through the process before the market crashed.

Erin Oooh! It was loosey goosey back then.

Alex And then he ended up short selling his place.

Erin For market conditions. It’s scary! You have to put your neck out there.

Alex I’m not even scared about the payment. That doesn’t even scare me. What bothers me is the process of someone saying you’re approved. What the heck? I’m seeking validation.

Erin You are approved. I ran you through desktop underwriter. You’re approved. I’m not worried about it. I get it. When I was negotiating with the builder and I was worried, what’s going to happen. I don’t know that side. I don’t know what’s acceptable. I rely on my real estate agent at the time to handle that. I didn’t know. Just like you’re coming to me, “so am I saying this correctly? I don’t want to put any words in here that could mess things up”.

Alex It’s so funny that we’re in this position. Because I understand negotiations very well with builders, and how we negotiated our sale. We went under contract a year ago and we were able to negotiate with them to release just that house in that block of homes. And they said, “okay that’s fine. But we can’t publicly release until October.” So that was fine. I gave them money. That was another problem. I thought, “oh my god I have to source all these checks!”

Erin It’s not a problem, it’s just more homework.

Alex More homework, I’m like, wait, where did that come from? And then here I am a year later doing all this. To me, what you just said is very easy to negotiate with the builder.

Erin And to me the loan process is very easy.

Alex And here we are together talking to listeners about what we think is easy.

Erin It’s all relative.

Alex What you think is stressful is easy to me.

Erin And when you’re calling me, I’m like Alex it’s fine. It’s work history. Just fill it in. That’s so telling. Why are you asking me this question? Are you looking for there to be a problem?

Alex Here’s the other thing. I haven’t dealt with a loan in over a year. All my buyers have been cash. I’ve only been dealing with sellers and buyers. I forgot about this process all together. And I was like, what? I had no idea and then w hen you were sending Josh the updated stuff, he was like, you haven’t seen one? I was like, dude it’s been over a year.

 

FEELING VULNERABLE IS PART OF THE HUMAN CONNECTION

Erin I remember we talked about this a year ago. To the listeners, it’s a great thing to buy real estate, but it’s going to feel a little uncomfortable. It’s going to! If you’re human, you’re going to feel some degree of emotion and/or discomfort in something that’s unfamiliar to you. It’s a human connection.

Alex I think people are going to feel a lot more discomfort too, because you have to share, you have to be vulnerable. You have to open up your finances. And you’re thinking, you’ve probably heard this before, Oh they’re going to judge me. And I tell borrowers all the time, I don’t care if you can afford $50,000 or $50 million. I just don’t care. You just have to be honest.

Erin That is such a good point. You’re right. There are people who are fearful of being judged. Therefore they try to puff up a little bit. And I understand why. Self preservation. People feel like they have to put on this show. And this is such an important piece: for me to do my job best, I need to know it all. I need to know your insecurities. I need to know your pain points. I joke that it’s like we have to start dating because I need to know everything about you for me to meet the needs that you are expecting. I would imagine the same thing is for you on the sales side.

“For me to do my job best, I need to know it all…I need to know everything about you for me to meet the needs that you are expecting.”

Alex On the sales side they can hide it a little more. We don’t need to go in depth with their finances.

Erin They can hide the details. They can say, “eh, I can’t look at that house because I’m not approved. Some people I’m sure go anyway.

Alex Mmmmm? Usually we try to get them completely pre-approved so I have all the info. I know where I can push the limits on certain things. What most people don’t realize is that around here taxes vary. So we can place you in Chevy Chase MD or we can place you in DC and the tax difference.

Erin Around here you can buy two houses right next to each other and the taxes are different.

Alex Same thing with condos. Not everyone realizes that. For a condo, you also have to factor in your condo fee and a bunch of other things.

Erin Especially if someone is approved to a certain point and then they didn’t take into consideration the condo fee. Down in Bethesda a condo fee can be $700-$1000. So they say “I can afford a $500,000 condo” and I say great! Great! Are you going to get a second mortgage for the condo fee?

Alex For you, the buyers have to be more vulnerable because you’re meeting them or you’re having a conversation over the phone. I think that’s where unfortunately Rocket Mortgage succeeds, because like dating, it’s like online dating, you can hide behind. But at the end of the day you still need to share. You need that human connection.

 

BUYING A HOME IS JUST LIKE DATING

Erin Yeah, about the “spaceship mortgage” company that will remain nameless. This is not an ad sponsored by Rocket Mortgage.

Alex We had that conversation that people were like that is a walking lawsuit right there. I think there is always going to be a need for a real lender that you have to meet with and the same thing with an agent. You need a human connection.

“You need a human connection”

Erin You want to. There are people like you have described don’t want to sit in front of me, who don’t want to take the advice I can give them, who don’t trust me. That’s fine. I don’t want to work with them anyway. They don’t value the advocacy that we offer our clients.

Alex I also think that you guys, to touch on it, you may not be pre-approved today. You COULD be a year later. That’s what Erin and I were talking about before we started. Where I was a year ago I would not have been able to purchase the home that I’m building today. It has nothing to do with me working harder. It had to do with me making the right moves, with the right advice from The Yi Team on how to put myself in a better financial position. That’s the difference in an online agent or lender, versus someone that you meet.

Erin It’s a relationship, right? So, to your point earlier, this is the largest indebtedness, it’s also a huge for the sake of purchasing real estate, I don’t know if you watched Chong’s show this morning (Mortgage Monday on Great Day Washington, WUSA9), he made a great point that you can acquire a $600,000 asset by only putting down 5%. People don’t look at it like that. They look at it like, “how much is my payment going to be?” And that’s important too, there’s lots of different layers.

Erin The point is, with real estate you can get this huge asset and only put a little bit into it. If you go to a car dealership, you can get a loan for a car, but can you buy anything else for a tiny bit and that asset appreciate year after year? A car doesn’t.

Alex No.

Erin The example is that when it comes to having a conversation about what’s going to work for you, it’s specific to you. 100% to you, to no one else. There are guidelines that mortgage lenders have to follow across the board. But your story is your story and without all of your little intricacies and goals and timeline, you can’t put a square peg into a round hole. We have to figure out what it is that is important to you. What is in the way, if anything? Right? And identify all the steps that you need to take, sometimes it’s only a couple. Some people are just scared. They need the human connection.

Alex A couple could take months. Or a year. Or more.

Erin Or more. It just depends. But you set a really high goal for yourself.

Alex Extremely high.

Erin You knocked out each step and here you are. That’s a testament to how, if you’re not wanting to buy a house today, you need to identify what it is that you need to do in order to be ready when the time is right for you. Not just fiscally, but also emotionally.  Because you could be ready emotionally but not ready financially. And you could be ready financially and not emotionally!

Alex You have to be both. You have to be at least a little bit of both.

Erin There’s not always going to be a perfect balance. It’s about talking it out. This is why there will always be a need for real people, not just robots. That’s the human connection.

Alex I think anything with finances there will always be a need for a real person.

Erin Yeah, I agree. Good stuff!

Alex Yeah, it was vulnerable. I like it.

 

RELATIONSHIPS AND ADVOCACY

Erin I think this was important. This was the reason you wanted to start having these (podcasts). This is why we started having these conversations. It was about making this literally obtainable to anyone who wants to, if they want to take that step.

Alex And we talked about in the beginning is humanizing what we do. The Human Connection. For us it’s a process. Steps 1 through 10. Whatever steps. But then we forget along the way that there are actual people.

Erin Which is a great reminder. That’s what makes us good at what we do, is creating the relationship and advocacy, again, is so big. How do I represent you? It’s only by knowing all about you that I’m going to represent and advocate for what it is that you’re looking to achieve. That goes both ways. It’s not just on the loan side, it’s also on the sales side too.

Alex Love it! All right you guys, tune in next week.

Erin We’ll have lots more fun stuff to talk about. We’re going to start doing a mail bag sort of thing, where we’ll get some Q&A out there. What are some real questions you all have?

Alex I think we said last week that we’re going to Instagram this, so.

Erin Maybe next time.

Alex We’ll have to figure out the Facebook live and put questions out there.

Erin Definitely. Maybe a poll or two.

Alex Yeah, I definitely think so. And last week you answered the question, how do you take your coffee?

 

HOW DO YOU TAKE YOUR COFFEE?

Erin Oh, Alex! It’s your turn!

Alex That’s right! I just thought about that. Our whole purpose.

Erin Alex, how do you take your coffee?

Alex Oooh! Okay, so I did a video of how I take my coffee. I did a video like a year ago, MTV Crib Style. I’m going to get to the point here. And I was showing my fridge. And I was showing my favorite coffee. I pronounced the coffee and I had people trolling me saying that I’m pronouncing it wrong.

Erin Oh Lord.

Alex So I was like, I think it’s pronounced “Stoke”. It’s S-T-O-K with the two dots over the O. I think? I think it’s Stok. [ www.Stok.com ]

Erin Whatever you want to call it, I agree.

Alex So it’s cold brewed coffee. It’s like this 10 hour process. It’s in a container. I get it from Harris Teeter. It’s unsweetened. So I pour it over ice in the morning, into my cup. I like to use, Califia Farms makes this coconut creamer. [ www.califiafarms.com ]

Erin This is fancy! This is real fancy! I’m like Coffee Mate, hazelnut, sugarfree.

Alex I drink cold brewed iced coffee with Califia Farms coconut creamer unsweetened. And I put that in there and I stir it up and sometimes…

Erin Even on a cold day?

Alex Oh I love it! It’s like my favorite.

Erin Really?

Alex Yeah.

Erin This is the time of year that I’m going to GO to iced coffee.

Alex I just love it. It’s not bitter. It’s the perfect aroma.

Erin We need to get Stok to sponsor our podcast.

Alex It’s the perfect amount of sweet and bitter at the same time. But then when I’m feeling fancy…

Erin When?! Alex, you’re always fancy.

Alex This is really long and drawn out. You should hear me order a drink. Do you know Laird, the professional surfer? [ www.lairdhamilton.com ]

Erin Nope.

Alex He created this coffee creamer. Found it in Hawaii when we were on our honeymoon.

Erin Ha! She’s not fancy ya’ll.

Alex No! And this is like coconut shreds, super fine. So I add it to the top. It’s like what you would put your hazelnut or whatever.

Erin Do you put your pinkie out when you pick up your glass cup?

Alex No! This is how bad it is. It’s not even in a glass. I use, they are plastic cups but they’re made out of corn. I use corn straws, so they’re eco friendly.

Erin Oh my god.

Alex Because I drink eco friendly coffee so I need an eco friendly cup to put it in!

Erin Tune in next week for more on how we’re serving our planet as well as we’re serving our local real estate market. Thanks for listening guys!

Alex Thanks! Have a good day! I hope you enjoyed the Human Connection podcast!

 

MORE COFFEE & JAM

Time Management in Real Estate

On The Fence About Buying Your 1st, 2nd, 3rd Home?

What Color Is Your Door Knob?

Buying A House Without Your Spouse Benefits And How To Accomplish

Decluttering Your Home Before Moving

Pros and Cons Of Technology

How’s Your Summer Body?

Up The Ante

Safety Nets

Stay updated on Stitcher, Coffee & Jam 

Your Summer (Housing) Body

Coffee & Jam Podcast with Erin Finke and Alex Ross

Hey Everyone! How’s your summer (housing) body coming along?

Erin Finke of The Yi Team at Fairway Independent Mortgage Corp and Alexandra Ross of Ross Residential RE/MAX are talking about the safety nets and contract contingencies that you can build in to a home offer to protect you whether you are the buyer or the seller.

Scroll down for the transcript and links.

GET YOUR SUMMER HOUSING BODY READY

You should have been working on it for the last couple of months! We’re in May already!

And by that we mean, how is your summer “housing” body?!

Just like working out and just like going to the gym, results are made over the winter to have that beautiful body come summer, that you all desire to have.

You’re not going to be a statuesque beach bod or beach house without planning. You’re going to wake up one day and say, “I wish I started 6 months ago.”

Unless you won the lottery. That fixes everything. Then you don’t need us!

People think about buying and say, “I’m getting ready to buy!” and they’re not ready. And when we say they’re not ready, they have decided in their minds that they’re ready, but in their body, and when we say body we mean being realistic, having their finances in order, having your home on the market if you need to sell one, your summer housing body. All these things are important in preparing to purchase property.

It’s like your diet, if we want to relate it to something.

Right, if you want to whittle away at the fat if you will.

If you have debt you lose it, at least some of it. You can keep a little on.

To that point, it doesn’t just happen over night.

HOW YOUR MORTGAGE ADVISOR IS LIKE YOUR TRAINER

We’ve talked about buying property. But have we talked about how much time it could potentially take to purchase a home?

Most people you come across as a mortgage advisor are really ready right off the bat.

Right, there are some things based on what their goals are that need to be addressed. It’s just like meeting with a personal trainer for the first time.

“My ass is fat, I want it to be less so. So what do I do?”

How do you get where you’re going?

How is your summer housing body?

JUST GET STARTED

It doesn’t mean that you can’t buy a house this summer, if you haven’t been training for 6 months. It’s May now, you could buy in early September?

The whole point is you’re going to wish you started yesterday.

START WITH YOUR CREDIT SCORE

Alex and I were thinking about all the things that you need to know to get started. You need to know your credit score. That could be a place where there is a little extra fat hanging around. Maybe there are some derogatory items that need to be cleaned up. Or maybe it;s a little extra credit card debt that you want to tighten up and boost your credit score.

You can do this in a short amount of time. It’s the myth of how long it will take. Now, if you haven’t paid a bill, or have been habitually late for the past two year, then it is probably going to take a bit of time.

As a disclaimer, neither one of us is a credit expert or can determine credit scores. But we have seen many occasions where someone has credit issues and they want to write an offer today and there ARE things that can be done today to put you in a better position.

But there have been times too, where we have buyers that want to buy a house today and the cards just aren’t working out for them because of something in their housing that needs to be cleaned up first. It’s just the nature of it. If you stick your head in the sand like an ostrich, you’re not going to see or get anywhere.

I know we’ve touched on it a while ago on these things that you wanted that you called a pipe dream and here you are two years later with them.

And here I am again today, oh I have another one. I have these pipe dreams of things I want to do. It just means that it’s something that is far away. I was thinking about one today, okay this is something that I want to obtain in two years. And I’ve already put the motion in my head. And the steps I need to take to get there. Because it took me a year to get to where I am today. An entire year.

 

COFFEE AND JAM PODCASTS

Human Connection, working with a face to face with a professional who is an advocate for you.

Get Off The Fence, there are so many ways to build wealth with real estate!

Time Management in Real Estate, what it means professionally, personally and why it’s important to buyers and sellers.

 

 

 

Coffee & Jam Podcast

Coffee & Jam Podcast with Erin Finke and Alex Ross

Welcome to the Coffee and Jam podcast featuring Erin Finke of The Yi Team at Fairway Independent Mortgage and Alex Ross of Ross Residential RE/MAX.

Alex Allright, hey everyone. This is Alex and Erin everyone.

Erin Heeeey!

Alex Allright podcast 1. What is this Erin, the pilot?

Erin This is our pilot version of Coffee & Jam podcast. We are introducing ourselves saying hi to the world!

Alex Yes, so thank you so much for listening. We just wanted to do a little bit of today’s content as far as introducing us and what’s to come in the future episodes, maybe some future guests. And we have a really fun way of ending this podcast so make sure you listen to the end.

Erin I’m Erin Finke, just call me Erin for short. I’m a mortgage lender in Rockville MD. Alex and I have worked together for years and we thought wouldn’t it be great to put together some really great content in a podcast which isn’t really being done right now. We want to introduce ourselves. Rockville MD is where I am, like I said. I grew up here for the most part. I love the area, love the diversity of our area and all the opportunities.

Alex Did you ever get away? Where did you go to college?

Erin No, I was here the whole time.

Alex You stayed in the cold?

Erin Yes! Where did you go?

Alex Florida!

Erin Oh! That makes a lot of sense now! No, I’ve been here. I’m real boring. Alex is going to bring the diversity to this podcast. I can promise you that right now! I’m as white bread as it comes.

Alex Even though you’re vanilla, at least you change it up with toppings.

Erin I do! Sometimes I like to put a little hazelnut in there.

Alex Oooh! Haha!

Erin I usually do straight chocolate jimmies.

Alex Ooo! Jimmie Cone sounds good right about now. Let’s drive out to Jimmie Cone!

Erin Hey Jimmie Cone, opening soon! (Jimmie Cone is in Damascus and Mount Airy MD)

Alex I’m Alex, I’m from the area as well. In the Potomac area. I went to Wooten High School, so local as well. And I DID get away. I chose to peace out and live the golden life for a little bit. For those of you who don’t know I’m obsessed with Golden Girls. So I lived in Boca where all the older people go to live.

Erin All I can see is palm frond fabric right now, or bathing suits.

Alex That’s basically my guest bedroom. It’s Blanche’s bedroom. So I went to Lynn University , small little school. And then I came back and always wanted to move back to Florida. But then I met Josh. Josh is my husband. He’s also in real estate.

Erin Dammit Josh. Always squashing the dream.

Alex I know! And then years go by and we start our team. Now we have my mom, Tracy, and Antoine.

Erin Ross Residential in the house!

Alex Our office is downstairs. We’re RE/MAX Realty Services and Erin is just three floors up from me. So we had a brilliant idea of starting a podcast and wanted to see: 1) is anyone going to listen…If you’re there, hi!

Erin I’ve always felt like I have a good radio voice so I felt this was a natural fit for me. You guys be the judge! “Today on With Alex and Erin, we’re introducing ourselves as well as what we do. Alex is an expert real estate professional. I am an expert mortgage lender with The Yi Team at Fairway Independent Mortgage.” Was that okay?

Alex You annunciation was VERY good.

Erin Do you think it was good? People say that I talk SO fast. It’s a thing with my dad and I.

Alex We’ve had that conversation that we think we need to slow down.

Erin Yes! So I am trying to take my time…

Alex Thank god we’re not drinking.

Erin Well, we’ll get to that. I’m sure there will be an episode on that. But my dad always says to me, “Erin, gosh! Slow down!”  and I say, “Dad, just speed up your hearing, and we’ll be fine.” So we go at it a little bit. I find myself speaking fast. So this is going to be great on many levels: getting information out to the masses that we find valuable and we think other people will find valuable. But also in practicing speaking clearer and slower so that people are not confused.

Alex There you go. So just a recap, we are in the real estate industry. We hit both targets: mortgage and lending, and also finding you homes and selling your home. In the DC Metro area. So let us know what questions you have. Each week we’ll add onto content. We’re going to try to make it “sexy” because I just don’t find what we do to be very dry.

Erin It can be very dry! But we both have the kind of personalities where we want to have a good time. Having these organic conversations about what we do, and also how it can be fun, and exciting.

Alex I think it is.

Erin Clearly I find it exciting because I like to do it every day. I think we can have a lot of fun here. People will enjoy making fun of us, together.

Alex So it’s like a little bit of CNBC mixed with a little bit of HGTV up in the house here.

Erin Right, with a little bit of TLC maybe?

Alex Maybe a little bit of BRAVO?

Erin I can get down with a little bit of BRAVO. Don’t Be Tardy?

Alex Yes!

Erin I’m kind of a big Kim Zolciak-Biermann fan. It’s definitely one of those secret single behaviors. Don’t tell anyone.

Alex Thanks for tuning in to our Coffee & Jam podcast. We’re going to end each episode with a question. It’s going to be the same question every time. I’ll start by asking Erin. Once you guys hear it if you want to send us a message and let us know, we’ll feature your answer in the next podcast.

Alex Erin, how do you take your coffee?

Erin That’s a great question Alex. I wish I had asked you this question first. I’m so simple. It depends.

Alex Oooh, mood?

Erin Well, am I on the road or am I at home?

Alex Okay, on the road. Because usually you’re coming here Monday through Friday.

Erin If I’m on the road, meaning I’m stopping for coffee, I would like a Vanilla Latte from Starbucks. But if I’m at home, I’m just going to have Donut Shop from the Keurig.

Alex I saw your daughter organized it for you.

Erin Exactly! Donut Shop, regular. With hazelnut, sugarfree Coffeemate creamer.

Alex Really? Yum!

Erin So next week you’ll find out how Alex takes her coffee!

Alex Have a wonderful day! If you’re in the DMV I hope you stay warm. I’m hoping for warmer weather.

Erin I can’t take it anymore. I’m just going to start wearing sleeveless shirts to WILL the warmth to come to me.

Alex I hope you don’t get pneumonia after that!

Alex Thanks for tuning in to the Coffee & Jam podcast! We’ll be back next week with a new episode when you can find out how I take my coffee.

Erin & Alex Till next time! Bye!

 

MORE COFFEE & JAM PODCAST

Human Connection

Time Management in Real Estate

On The Fence About Buying Your 1st, 2nd, 3rd Home?

What Color Is Your Door Knob?

Buying A House Without Your Spouse Benefits And How To Accomplish

Decluttering Your Home Before Moving

Pros and Cons Of Technology

How’s Your Summer Body?

Up The Ante

Safety Nets

Contract Contingencies

Coffee & Jam Podcast with Erin Finke and Alex Ross

Safety Nets & Contract Contingencies

Erin Finke of The Yi Team at Fairway Independent Mortgage Corp and Alexandra Ross of Ross Residential RE/MAX are talking about the safety nets and contract contingencies that you can build in to a home offer to protect you whether you are the buyer or the seller.

Scroll down for the transcript and links.

We are back! I am eating so I’m so sorry if you hear me chomping.

Yesterday was Memorial Day. Honestly I don’t get why you say “Happy” Memorial Day. Which is a day to remember those who served. So how to me that is not “happy”.

To me it’s “Honorable” Memorial Day but not “Happy”.

It’s an “Honorable Memorial Day”, not “Happy”.

Why do you say it, though?

I think it’s just a way, a salutation to acknowledge the holiday. Kind of like saying “Happy Labor Day”, “Happy Veterans Day”.

Veterans Day is celebrated for those who are still alive.

Memorial Day is for those who have passed. If anyone is listening, can you explain it to me?

There is Chong. Chong is looking through the glass of the conference room again..

Hi, we are recording. We have a guest speaker so make sure its ..we’re live right now.

Hey! How’s everybody doing?

Do you know why they say “Happy Memorial Day”? To me it’s not happy. Shouldn’t it be “Honorable Memorial Day”?

I agree with you.

Do you know the origin of why they say “Happy Memorial Day”?

I don’t. I’m old, but I’m not that old.

I didn’t think you were that old!

I just thought of something when Chong walked in here. My husband loves trivia and he said to me the other day, did you know that in Korea, that when you are born, you are one year old?

I am Korean.

I know you are.

So that would make me 63. Just kidding.

No it wouldn’t.

Isn’t the Korean calendar different than the Eastern?

So when you were born were you one? And then you turned your age…I don’t know. Dammit. I’m going to go back and figure it out.

I’ll ask Chong. He’ll know because he’s Korean.

I am Korean, kinda. No, we actually, we the Koreans. we use a different calendar.

Did you not know this? Because their birthday isn’t the same as the birthday they celebrate in Korea. I know this with your sister.

It kind of changes.

So, when I came over here, my birthday isn’t really June 27th, in case anyone wants to give me any treats.

But it’s really a different date. I don’t remember exactly what date it is. But when we came over, the date on my birth certificate is June 27th. So that’s how it just was.

So you could be older than you know?

I’m younger

It’s like leap year.

Yeah.

But the opposite.

But it’s like 20 years less. So I’m really 30.

Haha! Your’e a time traveler!

Yeah, it’s really weird. I don’t know about that one thing, I have to ask my sister.

Derek loves to find these random facts that he finds on the internet. If he found it, I thought well, then it has to be true. I thought, I’ll have to ask Chong. He’ll know.

That’s right. I’m all knowing. All knowing that I know nothing!

Do you want to talk about….I’m eating, everyone knows I’m eating. its fine.

Okay.

We’re talking about contract contingencies today.

Okay that’s the topic, we haven’t said it yet.

Nice segue Erin.

Oh, hi you guys. We’re talking about contract contingencies.

Ok, I’m going to go then. I need to go talk to a good client of ours. and make sure that they’re taken care of because that’s what we do. And Alex Puderbaugh Ross, because you are married.

Wow, that’s like the 2nd person to say that in a week.

You didn’t let me finish. Puderbaugh Ross. It’s Alex Ross everyone.

I’m not a law firm, I dropped that.

Finest realtor that I know. And I want you to know that it’s a pleasure to spend 37 seconds with you. And goodbye everybody. Chong out

bye. This is why I think we need a red light, or a sign, that says “on air”.

You’re welcome for us wasting however many minutes of your time.

CONTRACT CONTINGENCIES

Last week we talked about deposits. This week we’re going to talk about contract contingencies. We’re only going to touch on 3 or 4 of them because there are a lot of contract contingencies that are available. It also depends on if you’re doing residential, commercial, land, leasing, whatever it may be.

So, we’ll start with the most common contract contingencies which are financing, appraisal, home inspection. Those are the top three. And then next one would be home sale contingency after that. So that makes four. There are more we could bore you with . It’s three pages worth.

Can you make your own contingency?

Yes, you actually can too. You can make, for example, on commercial or, we’re doing one right now where they’re buying the lot next door which has a house on it. But it’s contingent upon permits. So you can make anything contingent.

That makes sense. You need a permit for them to do. The point is that the seller and the buyer have to agree on the contingency. That’s what a contract is. It’s where two parties are agreeing to terms. That is what a contract is. And what’s in the contract, there are layers of different agreements, and one section is contingencies.

Correct.

So if we’re talking about real estate for the purposes of living in it, in a residential contract there are at least two pages of available  contingencies and place to write in your own.

So you want to discuss financing contingencies first. it’s the most common if you are getting a loan.

Why don’t we start with the shortest contingencies? Like milestones. so you go under contract to purchase a home and then you have how many days? For home inspection.

HOME INSPECTION CONTINGENCY

Depending on what your schedule is and how strong of an offer you can put anywhere from 5 to 12 days. That’s not 5 days everything needs to be done. Everyone is agreeing for 5 days for the buyer to perform a home inspection by a licensed home inspector at their cost.  And then the report comes back and any items you want repaired or a credit. For we then have to make an addendum for it and include the inspection report. And that needs to be sent off within that 5 days.

From there, then the sellers have X amount of days to go back. Now, you can go back and forth and back and forth. Ideally your’e not going to want to. That takes, if you’re doing 5 days, that takes 8-10 days to negotiate by the time your’e done.

HOA DOCUMENTS

The other thing that we should talk about that isn’t a contract contingency per se, but it’s more of a law, is HOA docs and condo docs. That’s not a contingency, that’s actually a law.

That’s only for a property that has an HOA (home owner’s association).

For example, if you’re in an HOA and you want to paint your front door fuschia and you find out that front doors can only be espresso and green, you can walk (out of the contract) for that reason. You don’t have to say why, you just can walk. Now sometimes people may throughout that home inspection contingency time period and they still have time to read the HOA docs, they might leave the contract because of the HOA docs.

If your agent knows what they’re doing they’ll time it so they get the HOA docs a little bit later.

It’s interesting that we’re talking about the amount of time and how generally speaking its between 8 and 10 days after ratification the home inspection comes in and everything goes well. The buyer doesn’t ask for much, or the seller agrees to whatever repairs, that seems like a general timeline.

And those repairs have to be made prior to settlement, just to note.

Right, of course. As a tidbit, the lender has ZERO to do with your home inspection. In fact, the lender doesn’t want to know anything about your home inspection because it has to do with property condition.

This has happened a gazillion times. We get an addendum  from a real estate agent that says after the home inspection the seller has agreed to credit the buyer $2000 towards their closing costs due to repairs. Generally speaking, that will come in with the home inspection, but I don’t want to see it. Because if I stick that into the file, the underwriter is going to say, “well it looks like they need to have a roof repaired”. What a lot of people don’t understand is that the property itself is the collateral for the loan. So any defects in the property, we don’t really want to muddy the waters with that.

You have to then disclose because that information was shared to you.

And I can’t unsee it.

As opposed to just a credit for general repairs. Or addendum that money that’s going towards closing costs, and no mention of the home inspection.

There are a lot of situations where maybe they’ve capped their closing costs. So let’s say they’re only putting down 5% so they’re capped at 3% of the sales price concession. There are other things that need to happen then. Maybe reducing the sales price.

There are ways to play with the numbers instead of if you’re capped and you can’t accept anymore credits, you can reduce it. We’ve done that actually on a house in Frederick. We reduced the sales price by $3000.

So it all ends up being allocated somewhere whether it be in how much you’re paying for it, or lowering your costs at closing.

FINANCING CONTINGENCY

So those are the first two contract contingencies. I think you mentioned HOA docs. The next one is usually appraisal. Appraisal is usually the shortest compared to financing. Financing takes a little longer.

Generally speaking these days, it’s a week or two for financing. And that’s just to deliver the conditional commitment. And what we mean by that is you have a specific amount of time to deliver a conditional commitment to the seller. And that just means that you have followed through with your end which was making a loan application, and then providing that your loan has been approved by underwriting.

Now, on that conditional commitment is a detail listing any conditions that are currently outstanding from the approval. Let’s say you haven’t set up your insurance yet, or we need an extra pay-stub, its going to be listed on that commitment.

So for financing, what are people writing up for financing contingencies? What are agents writing for you guys?

Generally 20 days. I’ve seen 7, I’ve seen 10.

I usually do 21, and that extra day, because you never know if there’s going to be a holiday, for weekends which are really then lost. And then 14 for appraisal unless I know we need to close within a short period of time.

And if we’re closing in a short period of time, and that’s the thing we’ve talked about before, every deal is different. Every situation is different. So we do need to have a conversation about what it is that makes sense for this transaction. Is it going to be a transaction where we’re competing and we need to be super aggressive on how quickly we’re going to get the appraisal back to ease the seller and let them know that we passed that milestone? Or are we going to close? Let’s say the sellers find another property and they’re looking to move on, they need the funds from closing. They need to know they can sign their contract because they know our loan is approved. It’s a domino effect.

There are so many variables.

APPRAISAL CONTINGENCY

It’s so funny that you say that because on our side, when it comes to listings, only because we’ve been handling a little more lately, that appraisal, you know you’re going to have a little bit of wiggle room, and as soon as you get it your’e like, you know you’re going to get it, home stretch.

Because it really is a milestone of getting past a really large piece of the puzzle. That is, your loan is approved. Now, it’s not a guarantee that you’ll go to closing, because if you can’t deliver the conditions then you can’t deliver the conditions. Generally speaking, that’s not how it goes. However, we’ve seen it happen before.

But to the point of what’s involved in the contract contingencies for financing, let’s say we have the loan approved, but we don’t have the appraisal yet. So here’s where it gets tricky. And things are happening a lot faster these days. So let’s say we go under contract on a Sunday. The loan file starts on a Monday. They sign all of their disclosures on Monday. Send everything to processing on Tuesday. It’s submitted on Wednesday, and it’s approved on Thursday.

But you’re still waiting for…

We just ordered the appraisal on Monday! So that’s only a couple of days. We’ve got a loan approved without an appraisal.

No one is really moving that fast for appraisals.

Right. So generally speaking, 7 to 10 days is industry standard right now, for a non rushed appraisal.

We can always give them a target date, and they have to accept the target date. 5 out of 10 times they’ll say, “I just heard back from the listing agent, this is the earliest that I can get there, please push out the date”. And of course we can make sure we meet the appraisal contingency. But, we all stay on the same page on what the contingency is.

These contract contingencies can always be lengthened. If for some reason, like you just said, the appraiser just got the request, or there is a delay, it’s very easy to extend.

It’s a matter of everyone pulling in the same direction. So if a listing agent says “well, I get the appraisal done in a week”, you got it. we’ll make sure that’s taken care of. Then you have to answer your phone and give the appraiser access to the property for him to do the appraisal. And you can’t expect him to do it on the 7th day, and complete the report the same day. The reports are 40 pages long! So he needs to have access a couple of days before the contingency expires so that he can deliver the report. Not only that, but the report has to be reviewed by underwriting to make sure the appraiser did his due diligence.

Then if it comes in too low, it’s a pain to argue, but that’s a whole other can of worms. That’s a whole other podcast!

If it comes in low, is it a flawed appraisal or is the property really not worth what they agreed to pay for it, based on the data. the data is the homes that are sold around it?

To summarize, our first few are HOA and condo docs, and home inspection docs are your first contingency. And then next would come appraisal and then financing afterwards. The last one that we haven’t touched on yet is home sale contingency.

HOME SALE CONTINGENCY

Home sale contingency is if you have a home and your’e selling it. It is either listed for sale currently or not listed for sale. And you’ve found a home and you want to move forward on it. But you can’t move forward on it unless you sell your home. or unless your home goes under contract.

So a settlement contingency versus a home sale contingency.

That has a lot to do with being competitive in this market. If you’re in multiple offer situation, and you have someone who is writing with no contingencies but writing the exact same dollar amount net to the seller, but you have a home sale contingency.

As a seller I’m going to pick, as an agent I’m going to advise.

So that would mitigate some risk to the seller, correct?

Correct, so then we’re back here in 30 days .

If the home doesn’t sell, or maybe it’s listed too high, or whatever. It’s a matter of if you’re able to write non-contingent and you are comfortable with doing that, that’s something you can discuss with your realtor.

I feel like we could talk about this all day and I do want to unpack the home sale contingency and maybe some stories in another podcast. Also if you guys have questions that you’d like us to go a little more in depth on each of these topics, or if you have an example of contract contingencies that you’re wondering what you can write in yourself, please let us know. We’d be happy to go over these different scenarios.

Because I think each one could be it’s own podcast. We just don’t know what you want to know.

Because some of contract contingencies can get really dry.

Okay, on a random note, this is random, so in our neighborhood I, one of the reasons why we love our neighborhood, why we bought into the community is that everything is very uniform. They take care of everything. You’re not supposed to change the aesthetics of the outside of your house. You’re not supposed to change the landscaping, they do everything.

Oh god, what did you do?

I didn’t do anything! Someone two streets over from me took it upon themselves to, all the railings are this gray color, like this charcoal color. Every railing in the neighborhood, if you have a railing because not every house does…

Like walking up or…?

Walking up. Has to be this specific color. So everyone matches. So everyone’s door is maybe a different color. They painted their railings to match their door and it’s driving me bonkers!

Wait, what color is it?

Red. it’s like crimson red. It’s driving me bonkers.

Why would you paint your railings red?

Because they wanted to match the door.

That doesn’t make any sense.

I went as far as looking into my HOA docs and read it.

They’re listening to us, they know it’s you.

Well, if you’re listening, I don’t like it.

You need to look at your HOA docs.

Because I bought into a community knowing that everything is going to be the same.

Regulated.

And I don’t have to worry about and that my value is there. Now everyone is going to have different colored railings!

No, they’re going to get cited. It’s a new community.

Well, because I’m going to complain.

That’s the whole idea about an HOA. You’re supposed to follow covenants. They got the same docs you did that say what color your railing should be.

Exactly.

HOW DO YOU TAKE YOUR COFFEE?

So ending with coffee, I tried a new coffee.

I tried a new coffee too!

Tell me!

No, you tell me first!

No! Because it’s really not that exciting. It’s called Rise Up.

Mine isn’t that exciting either, but I tried a new place in Minnesota over the weekend.

Can you say Minnesota like you’re from Minnesota?

When I talk about Minnesota I get a Minnesota accent. So sometimes when I go to the grocery store I get eggs at the Minnesota grocery store, I’m like “Can I get the eggs please?”

You sound s little Jersey.

It is a little Jersey!

So in Minnesota there are not a lot of Starbucks. There’s a place called Caribou Coffee.

Yeah, that’s huge out in Seattle too, right?

Um, I don’t know. So over the weekend, my little sister-in-law got married.  She used to work at Caribou Coffee where she met her husband now. Super cute. So I asked her, “how do you take your coffee”? Because I’ve only stayed with her a couple of times, every time we go to Minnesota. So she has a vanilla latte with almond milk. It was delicious. It wasn’t that sweet, it was just a really good. If you’ve followed us from the beginning I usually have hazelnut, but the vanilla was really just smooth, not super sweet coffee. It was nice and was just different. So I had the vanilla latte and it was just delicious.

So what was the coffee that you had?

It’s called Rise Up, out of DC. On the weekends we make french press if we don’t go to the coffee place around us. And it was really good!

What kinds? Just a regular?

We made an espresso blend. Josh likes it very strong.

Like his woman. Haha.

Okay folks, I have appointments.

And I have a showing. Have a wonderful rest of your day. And it you have questions or if you have the answer to why we say “Happy Memorial Day”, let us know. Or any other fun facts.

DON’T STOP NOW!

More about How To Build Wealth With Real Estate here.

Ready to talk to a pro? Click here and click APPLY NOW to get started.

Contact Erin Finke at erin@theyiteam.com, and Alex Ross at www.rossrem.com.

MORE ABOUT COFFEE AND JAM

Coffee and Jam is a weekly podcast discussing all things about real estate, mortgages and home ownership.

 

CELEBRATING 1 YEAR!

THE YI TEAM CELEBRATES 1 YEAR ANNIVERSARY AT FAIRWAY INDEPENDENT MORTGAGE CORPORATION

May 2019

 

ROCKVILLE MD – The Yi Team is celebrating their one year anniversary since opening the new Fairway Independent Mortgage branch in Rockville MD. Creating a well planned mortgage for long term wealth is always the goal for The Yi Team. To many borrowers, these loan officers are heroes making dreams come true.

HOW THEY’RE CELEBRATING

So why not celebrate with a superhero themed happy hour! Customers and business referral partners are coming together at Clyde’s Tower Oaks for a few hours of fun to mark this milestone anniversary on Thursday, June 13th.

MILESTONES REACHED

Since opening their new location on Shady Grove Road in 2018, The Yi Team has punched through many business milestones. In addition to opening the Rockville location, The Yi Team brought on additional mortgage heroes to help even more borrowers reach their goals of homeownership and personal wealth. Loan officer Derek Harman and assistant Christa Fitch joined the team in December, to round off the existing pros, Chong Yi, Branch Manager, Erin Finke, Loan Officer, Jennifer Hansel, Loan Assistant, and Kellie Hodges, Brand Manager.

In order to best support their referral partners, The Yi Team has increased their licensing universe to now include Maryland, Virginia, DC, Delaware, Florida and Pennsylvania. This has allowed them to help more than 100 families build their wealth through homeownership last year.

Smart technology is a Yi Team superpower. Starting with their exclusive website, www.theyiteam.com, they make online applications as easy as a click of a button. The Fairway App means borrowers and real estate agents can track a loan in progress in real time, leaving nothing to chance.

Education is another Yi Team strength. Chong Yi champions Mortgage Mondays on Great Day Washington WUSA9. Erin Finke spreads her mortgage intelligence on her weekly podcast, Coffee and Jam, co-hosted by realtor, Alexandra Ross of Ross Residential RE/MAX.

The Yi Team stays at the pinnacle of their industry by focusing on creating mortgages that build wealth. “We think of mortgages not merely as debt, but as a financial tool that allows a borrower to maximize their short term and long term financial goals. We strive to be mortgage advisors, and act in advisory role,” says Chong.

Opening their own branch allowed The Yi Team to participate in charities was an important milestone for the loan pros. This year Chong Yi was selected as a Real Men Wear Pink competitor, supporting the American Cancer Society. The Yi Team’s fall fundraiser was a major success and Chong Yi won the competition raising almost $9,000 for the charity. “It was a proud moment for me. Supporting my community has always been important but having my own branch meant that I was able to make a much larger impact on something I believe in. I plan to continue working with them this year too,” says Chong.

COMING SOON

Crushing milestones is why The Yi Team is regularly awarded Top 1%  by Mortgage Executive Magazine. Our heroes keep an eye to the future and search for ways to help their referral partners build their businesses.

Future goals include building the team with additional loan officers, new office space, and of course, improving loan product specialties. Supporting their community adds value to the work day. The Yi Team remains committed to the Real Men Wear Pink campaign.

ABOUT

The Yi Team at Fairway Independent Mortgage Corp is located in Rockville MD. Led by branch manager, Chong Yi, they believe that a well planned mortgage creates long term wealth. This philosophy is supported with sophisticated technical skills and uniquely personalized service. High tech means an effortless loan processing experience. Personalized service means you’re not just a number to them. You’ll hear from them each step of the way.

 

FOR MORE INFORMATION

Contact Kellie Hodges

kellie@theyiteam.com

More about The Yi Team, click here.

Technology Pros and Cons

Coffee and Jam Podcast

Do you find technology useful? Erin Finke of The Yi Team at Fairway Independent Mortgage and Alex Ross of Ross Residential, explain the technology pros and cons in the mortgage and real estate industry.

All right everyone, Happy Friday! We’re doing this podcast a little later in the week. Erin was on vacation in Jamaica.

I go to Montego Bay. It’s good to reset and get out of the business for a bit. I truly shut down. Although there is wifi, I don’t get email and try to stay off the internet. It takes a lot to prepare to leave on vacation, and then a lot to catch back up when I get back.

Great segue! Today we’re going to talk about technology pros and cons, apps and programs that we use in the real estate and mortgage industry. Let’s start with email and uploading documents.

 

EMAIL

Before 2009 everything was paper. You had to fax documents. Or people would come to the office. Or we would send documents via UPS or FedEx. Lots of sticky notes and highlighter. Sign here, sign there.

In 2011 we started moving towards less paper, more technology, more environmental saving trees.

Now the process is more simplified. If I can sign something electronically it’s less to print, sign or scan. It’s also easier to go back and read it. Easier than trying to find it on paper because you have a soft copy of it.

Different generations and groups may not like that as much and prefer paper. Younger generations have grown up using apps like this and are comfortable with it.

From the mortgage side we can do almost everything 95% electronically.

What can’t you do electronically?

There are a couple of documents that the social security administration does not allow us to use electronic signatures. It used to be that the IRS didn’t, but the allow electronic signatures now. There are a couple documents that you need to hand sign, or wet sign, and of course at closing.

They need to verify that you have a pulse and are a live person. They have those certifications that are back up documents.

 

DOCUSIGN

For those of you who don’t know what Docusign is, it’s a program that lets you sign things electronically. So your purchase contract can be done with Docusign. You have to go through and click every spot you have to sign. You can add anything on Docusign that requires a form to be check marked, initialed or signed. Like addendums, contracts, change orders.

Docusign also shows you how many trees you’ve saved. The environmentalist in me thinks, oh how nice!

It can be really quick, versus saying here’s a PDF. Print it, sign it, scan it back in, put it in an email and send it back to me.

 

INTERNATIONAL REAL ESTATE

Realtors still need to do that for international sales. Not all countries are able to get our email.  For example, certain parts of China, they won’t get links. The email shows up a month later, or our link is blocked. For China I have to FedEx documents and have them sign it. Buyers have to go to the consulate and have it signed and witnessed. That’s a whole different thing. thank goodness for Docusign. Let’s get back to the technology pros and cons for the US.

 

DOCUSIGN PRO AND CON

People can log in, they view it, they click and they’re done. This makes it really simple so that’s a technology PRO. Technology is a pro because it cuts down on resources, on time,  and makes things faster.

The CON to it is if you don’t have someone to explain to you what you’re signing in advance, then you’re going to spend a lot of time reading it as if it was printed out. People have questions and they call. It’s just easier if the professional is there to explain it. So that’s a CON.

If you know what you’re signing then it’s very fast.

Technology has to come with some preparation. For example, I would tell a borrower I’m going to send you a Lock In Agreement. The Lock In Agreement shows you what the terms of your interest rate lock is. It will say the lock started this day, and the expiration is this day.

Versus having a borrower read the verbiage that can be really ambiguous.

And there are people who are just not comfortable signing things electronically. They just don’t want to. But it affects efficiency and speed.

For example we have a client who went under contract on Monday and they’re closing next Wednesday. That’s a 7 business day closing! They don’t have a choice. When they decided to make the offer and ask for a very short closing, we can absolutely accommodate that but here’s the thing, we need all of this information right now and we’re going to be sending you stuff to sign. Unless you can come in the office regularly, it’s smarter to use technology to speed things along.

Wow, 7 days! They must not have a very complicated deal?

Well, I can’t say that it was simple, there was a lot of work that we did up front.

If you don’t have to source multiple things..then it’s easier.

When someone even asks to close something that quickly on an existing sale, there needs to be a very tight file. The title company needs to be on board too, because sometimes we’re just held up with title.

Those people might not have won that contract if they hadn’t been so competitive on their closing date, so that’s a pro.

I think another pro and con, is tracking people who can open it and who have said they’ve signed it. I can say, on page X you still need to sign.

Yesterday we had a very similar situation. There was a couple who are buying a property together.  I can go in and view that I have signed the documentation, and she has signed the documentation. But I could see that he hadn’t signed it. I can do a screen shot and show him where a signature is missing. So it allows everyone to stay on the same page.

 

APP

Fairway Independent Mortgage also has a great app where you can apply for a mortgage, upload all your documents, see where you are in the process the entire time. We always have that personal touch of human communication, but there are some people that just like to refer to something. They just want to look at an app, so that’s good technology.

I know I can always go in and see, even here in the conference room. I can open the app and see any loan that I have in the pipeline and see exactly where it is right now. It’s great for me if I’m out on the road or in appointments outside of the office and I get a call from someone. I know I can’t answer off the top of my head. I can just refer to the client’s file in the app, and you can see that they’re all listed right here. So that’s a pro for me that keeps me organized.

Let’s switch this and talk about consumer end, like the home search apps, which shall not be named. The problem with these apps is people can go in and change information, and sometimes the information is not accurate. The HOA fees can be changed, whatever. So we get a phone call that says this website or this app says this, but whatever docs you sent us says this. I have to tell them, ours is correct. Sometimes I have to call those websites and ask them to correct an address. There is the convenience of having access to this information, but the con is it might not be accurate information on the home search apps.

 

MORTGAGE CALCULATORS

You know what I always hear about? The mortgage calculators. For example, a client will tell me that on a certain website or app they put in their information and this is what it said their payment would be. Haha, you guys can’t see Alex but she’s sighing.

If you can put in a lot of information it can be a good tool (SOME OF THEM) can be a good tool, to understand where you payment would be. It’s a ballpark. Say it tells you your payment would be $1500 or $2500 per month. You can look at that and see where it would compare to rent.

I had  people just a few weeks ago that were doing numbers on a website. They thought their payment was going to be $1500 and this whole time they had been searching on their own. Without talking to a mortgage professional. They had been looking for homes for months and months, trying to narrow down the type of property they wanted. And guess what? That mortgage calculator didn’t include their taxes, insurance or mortgage insurance. They spent this whole time…

This is where you need to put a ballpark. If you know where you want to live in a certain neighborhood, then you can put a ballpark in as far as taxes. If your taxes are going to be $5000, then put that in. Look at the houses that you’re looking at. Then look at what the taxes say. Go a little higher. And the interest rates that you see today, go a little higher.

Definitely do a cushion so that you’re not let down. People think that if they plug in a purchase price then the calculator is going to give them accurate information.  There are some great calculators out there, but at the end of the day, you need to know everything that goes into that calculation. As a regular consumer, without talking to a mortgage professional,  you wouldn’t know. These calculators can be good for principal and interest payments. But remember, there’s more to your mortgage, or more to your housing expense than principle and interest. There’s HOA, property taxes, mortgage insurance. What if there’s a benefit, or special assessment? Or a private utility company? There’s a lot of things that can come in to play.

Use The Yi Team mortgage calculator and resources.

 

TECHNOLOGY PROS AND CONS

In general I think technology is helpful. Like now, we’re using technology right now. This podcast would not have been possible before. We would have had to go to a studio, and now we’re just using an app.

I’m an advocate for technology. There just needs to be an understanding about what comes with it. Don’t go with blinders on.

Tell us what you think. Do you like using technology or would you rather sit down with someone and sign all your documents by hand?

 

SECURITY

If you are going to use an app to upload your documents make sure that it is secure and use that two step authorization. That way, every time you log in it requires a passcode.

Our software on our Fairway computers, when we go to log in, it take a two step authorization. Everything we have has a two step authorization. That’s about it for Technology Pros and Cons.

 

HOW DO YOU TAKE YOUR COFFEE?

So how do you take your coffee? Let’s check our Facebook page (click here).

Mike Herson says “want my answer?”

Lee Kalt says “Cuban”

Cuban?! Yum!

Whats Cuban?

Shout out to Black Coffee on MacArthur Boulevard in DC.

I think we should taste a variety of coffees.

Let us know and shout out to Lee Kalt, who takes his coffee Cuban style.

Technology Pros and Cons.

For more about Contract Contingencies and how they can protect you as a home buyer or home seller, check out this podcast.

Mortgage As Investment

Mortgage Monday 3.11.2019, 15 or 30 Year Mortgage

Have you considered your mortgage as investment? Chong Yi advises different ways to pay for life’s big expenses by using your biggest asset. Using your mortgage as investment means taking advantage of your strongest asset.

GDW Hello it’s Mortgage Monday and today we’re going to talk about how to make your mortgage work for you.

GDW Did you know it can be used as a financial tool for some of life’s other big expenses you might encounter. So joining us now is Chong Yi of The Yi Team  at Fairway Independent Mortgage and Parker Trasborg of CJM Wealth Advisors. Gentlemen, welcome to Great Day.

CHONG Good Morning

PARKER Thank you.

GDW We think about our mortgage, and think *sigh* okay, we gotta pay the mortgage on this house, but you guys say there is so much more we need to be thinking about as well when we’re buying a home.

PARKER That’s correct. So when you’re buying a home there are some other things to think about to protect yourself. One of those is life insurance. Typical rule of thumb is you want 7 to 10 times your earnings in life insurance. Say your a younger person with a couple of kids that still have to go to college, you would probably want 10 times plus. Maybe you’re closer to retirement, you don’t have any kids, then 7 times or below is an appropriate figure.

GDW Okay so when you talk about your mortgage, and estate planing with life insurance and things like that, how can you real y make it work for you and not just the banks. Should you think about the names of the people who live in the house, the names be on the title?

PARKER So one thing to definitely think about is just the titling in general. If you’re a married couple buying a house together, you want to make sure the house is titled “tenants by the entirety” and that is another form of protection to make sure if one of you gets sued for something they can’t take the whole house away from you.

GDW Interesting! Say that again for people watching.

PARKER “Tenants by the entirety” if you’re a married couple.

GDW Okay, good.

GDW Chong. what else should we be thinking about when it comes to our mortgage? Because we think it’s just this debt that we’re incurring. How do we use that to our benefit?

CHONG I think you should ask Parker! He’s awesome! I don’t know if you know this, but Parker has the designation of CFP which is a Certified Financial Planner. That’s like the PhD of financial planners.

GDW That’s why you work with him!

CHONG That’s exactly right.

GDW You work with some of the best people in the business.

CHONG I’m sitting here listening to him and thinking, oh my gosh you think I would know that.

GDW I feel like I should take notes here. I know we’re going to tell people how to reach you.

CHONG Actually I can answer your question. Okay, so I’ve always talked about the mortgage as not debt. My parents had 16.5% on their mortgage that I grew up in. So for them, they always talked about paying it down. But in actuality if you think about it what you maximum return on investment, so if you’re paying 4%, which is where we are now (better than where we were last time), after tax benefits and all the stuff that we’re talking about you’re really paying at 3%. I look at that and think can you make more money on debt at 3%? Absolutely. And I would say give it to Parker because he’s going to give you a bigger return on investment. So the money that you’re going to put into your mortgage I always think of it as a tool to get you into a place where you can have this huge asset. For instance, in Arlington houses are going crazy, and in a lot of other parts of our area. I’m huge in using that mortgage as a tool to buy that asset, as opposed to treating it as debt.

GDW Assets like? Using that mortgage as a tool for not just physical assets, but for college education or something. I mean you want that house that your family is going to be in, but you still know that you children are going to have to go to college. How can you use your mortgage to help that?

PARKER Chong and I had a recent case where the couple wanted to cover their kids college education no matter what. They had already spent all of their education savings on private high school. So what Chong was able to structure for them is a cash out refi of their current home. Take those proceeds out. They were able to pay off the student loans and the parent loans that they already had in place, and going to be able to cover the last year of college. At the same time, it’s going to lower their monthly payment and they will have the payments all done by the time they retire. So it’s a pretty good deal for them.

CHONG Absolutely.

GDW That sounds encouraging for some people. You can also help people use life insurance in addition to their mortgage as a tool to help pay for education. Use their mortgage as investment.

PARKER Not necessarily to pay for education but it’s just a form of protection so if I were to get hit by a bus I don’t want my wife to cover the whole mortgage by herself. So she would have some proceeds there.

GDW Oh, okay. Any additional advice for people who may be at risk for being house poor, or they feel like they’re in a situation where they think “oh my gosh I’m house poor and I’m not sure how I got here”.

CHONG I think for starters I always go back to the “don’t think of your mortgage as debt”. Reduce your payment as much as possible. To the point where it’s almost like I want to borrow as long as I possible can with the lowest payment possible. At the end of the day, if you want to save for that occasion when you can’t make the payment you want to minimize your payment. Also the extra money that you’ll be saving you can turn that into assets for you. Once again, give it to Parker to get a good return for you.

GDW Sounds like we need an expert to figure this out.

GDW That’s right, there are so many options that we didn’t know about.

GDW Parker, Chong, so great to have you join us. And if you have more questions and want to see how your mortgage can help you, to inquire now about financing your home or anything else, contact Chong Yi of The Yi Team at Fairway Independent Mortgage, and online at www.theyiteam.com

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Chong advises that you consider your mortgage as investment, not a debt. There are many ways to use this as more than just a place for your family to live. Use it invest in yourself!

Is a 15 or 30 year mortgage the best for you? Click here to find more ways to use your mortgage as investment.

Let’s get social! Find us on Facebook here.

You can find more Mortgage Monday clips on WUSA9, here.

 

 

Time Management In Real Estate

Time Management In Real Estate. Weekly Podcast Covering All Things In The Mortgage And Real Estate World

Time Management In Real Estate, The Coffee And Jam Podcast

Just a conversation about time management and what that means professionally, individually, and why it’s important to a buyer and seller.

SET UP YOUR CALENDAR

First set up your calendar. Use color blocking to mark the money making events in green. That’s your “green time”. Be smart about distractions.

Mike Herson of Congressional Insurance posted on Facebook a great quote. When he goes into a meeting with a person, he’s giving that person the same level of undivided attention that you deserve. You can’t give a superior level of service when you’re reacting to phone calls.

PERSONAL TIME MANAGEMENT

We’re working with multiple players on a mortgage: buyers, buyer’s agent, sellers, selling agent, title companies, etc. Time management is important here especially. Spring through July is our busiest time. We slow down in August. Alex will only show 5 houses in one day. Otherwise it’s too much, for a realtor and for a potential buyer.

Knowing when to take a breath is very important to stay successful. Both Alex and Erin devote their personal time to family after a certain hour in the evening. It’s a time to recharge. Don’t keep your phone by your bed. It’s too tempting to check in. Alex will leave her phone across the room. Erin recommends not looking at your phone unless you have time to actually deal with a problem right away.

Know and honor your limits. Take time to recharge, step back and realize that life is great. Use time management in real estate in smart ways.

WHY IT’S IMPORTANT FOR BUYERS AND SELLERS

Contracts are state that time is of the essence. It’s important that buyers and sellers are timely with documents and  on time for showings. For example there is a contingency in loan procedures that states without certain documents a loan officer cannot order an appraisal, by law.

WHERE TO GO FROM HERE

Drop in on the next podcast, “Get Off The Fence”, how to build wealth with your home equity. So be brave, reach out to Erin or Alex to talk about your options!

Catch up with Alex Ross of Ross Residential at RE/MAX. 

Find out what our clients are saying about The Yi Team in our testimonials.

 

 

Get Off The Fence!

Time Management In Real Estate. Weekly Podcast Covering All Things In The Mortgage And Real Estate World

On the fence about your 1st, 2nd, or 3rd home loans? Get off the fence! There are so many ways to build wealth with real estate. Alex and Erin discuss using the equity in your home to move up to your next home. Get off the fence about home ownership!

Erin Finke of The Yi Team at Fairway Independent Mortgage Corp and Alexandra Ross of Ross Residential RE/MAX discuss how to build wealth through real estate investing, 1st, 2nd or 3rd home loans, and what their favorite cup of coffee is with a shout out to Mike Herson, Congressional Insurance Associates.

MISCONCEPTIONS OF OWNING YOUR OWN HOME

So many people are reluctant to get into the real estate market. Maybe you hey saw your parents struggle during the 2008 financial crisis, maybe you’re bogged down with student loans?  Or maybe you are feeling footloose and fancy free, and don’t want to be held down by home ownership?

Erin discusses how all of these ideas are misconceptions to home ownership and building wealth. She provides a reality check to clients so you’re not getting in too deep financially. Wonder what it takes to purchase a $400,000 house?

RENT VS OWN, PROS AND (not many) CONS

Get the scoop on what it takes to purchase your first home. Then build equity to move up to your next primary residence. There are so many tax benefits and other benefits to purchasing a home. Stop renting and get off the fence! Get into real estate ownership!

DON’T STOP NOW!

More about How To Build Wealth With Real Estate here.

Ready to talk to a pro? Click here to get started.

Contact Erin Finke at erin@theyiteam.com, and Alex Ross at www.rossrem.com.

MORE ABOUT COFFEE AND JAM

Coffee and Jam is a weekly podcast discussing all things about real estate, mortgages and home ownership.

Improving Aged Inventory

Calling all Realtors! Join us for this free seminar! Creating Value Through Renovation Loans – Improving Aged Inventory Seminar

Tuesday, April 2, 2019

1:00 pm – 4:00 pm

Greater Capital Area Association of REALTORS

15201 Diamondback Drive

Rockville MD 20850

JEFF LEE – VP of Renovation Financing at Fairway will be presenting

Adding value and keeping yourself relevant is one of the most important topics in today’s Real Estate climate. What can you do to provide value? What can you do to differentiate yourself from others? Fairway Independent Mortgage Corporation wants to show you how renovation lending can increase customer satisfaction, create more referrals and increase your bottom line. Creating value through renovation loans helps strengthen your business.

TOPICS INCLUDE:

  • Fannie Mae’s Homestyle and FHA’s 203K product eligibility
  • What to look for during a home inspection
  • Understanding your market and determining if a renovation loan is a good option
  • Taking the fear out of renovation lending

Click here to RSVP!

QUESTIONS about creating value through renovation loans? We’re just a phone call away.

Hope to see you there!

Chong, Erin, Derek, Jen, Christa and Kellie

The Yi Team at Fairway Independent Mortgage Corp.

301-972-9420  |  chong@theyiteam.com

 

For more information on our loan products, contact us here.  Or go to our Resources page. 

 

15 or 30 Year Mortgage?

Mortgage Monday 3.11.2019, 15 or 30 Year Mortgage

Should you get a 15 or 30 year mortgage? Do you need a 20% down payment to buy a house? How long should you keep your mortgage documents? How do you get started with a loan to buy a house? It’s Mortgage Monday on Great Day Washington, WUSA9! Chong Yi shares his mortgage expertise and answers these questions.

Tune in every month for Mortgage Monday to get your mortgage questions answered. AND, if you have a question, post it on the Facebook page and have it answered LIVE!

Are you a real estate agent, title company or financial advisor? Want to join Chong on the show? Send us an email or post it on Facebook!

TRANSCRIPT

GDW  Welcome back, today we’re kicking off our new series. It’s called Mortgage Monday. During this series Chong Yi of The Yi Team at Fairway Independent Mortgage Corporation has advice on the latest insider knowledge on buying a home.

GDW  Good morning, good to see you again Chong.

CY  Good to be back.

GDW  Welcome to Mondays! Read More

Buy A Home, No Money Down

Great Day Washington WUSA9 Real Deal In Real Estate with Sharif Ibrahim 1.10.19

Buy A Home With No Money Down. More about Down Payment Assistance Programs.

Having to put 20% down on your home is a myth. There are so many options, especially in our area of DMV that allow you to purchase a home with NO money down! The DC Open Doors program is one of many loan down payment programs that help home buyers start building their wealth. The idea that you have to pay someone to live somewhere, you might as well pay yourself is a strong one.

TRANSCRIPT

GDW  Welcome back to Great Day Washington! We’ve got insider tips to help you build wealth through property investing and the Real Deal in Real Estate. I’m here with Chong Yi of The Yi Team at Fairway Independent Mortgage Corp, Josh Greene of Eastern Title & Settlement, along with Sharif Ibrahim of Old City Properties. Welcome to Great Day, guys!

JOSH  Good Morning!

CHONG  Hey Markette!

GDW  Well, with the new year people are always speaking of ways that they can build wealth. I want to start with you, Sharif. A lot of people think, well, real estate might be difficult because I need 20% down payment. But you say, that’s not true.

SHARIF  No, most people do think you need 20% and it’s just a myth. There is a great program here in the district today that allows you to purchase something for no money down. That’s just one of the great programs that are here available for district residents today.

GDW No money down in DC. That sounds like a win for someone who is looking for move, but also use their property as a way of building wealth.  Can you guys elaborate on that?

CHONG  Yea, absolutely. First of all, DC Open Doors is the name of the program, but there are a lot of other down payment assistance programs around the DMV. So that’s just one of them. And it’s great, and a great opportunity for people who feel they can’t purchase because of a lack of down payment or  closing costs. It may be possible to help them purchase the property with some sort of assistance. There are other 100% programs. I’m all about building wealth. We all want to be wealthy. The best way would be to buy real estate. I would certainly call Sharif to do so, because he’s awesome, and I just met him, but he’s great.

SHARIF  Thank you, haha!

CHONG  At the end of the day, you have to pay somebody to have somewhere to live, so you might as well pay yourself. As time goes on you can increase your equity positions by paying down your loan. Then, over time the house appreciates, so you grow and become wealthy over time. Hopefully as wealthy as that guy right there. *points to Josh*

GDW  Absolutely right. It’s good to be a business owner but you can be an owner by having tenants, and have them pay you.

JOSH  Yes. You know one of the things DC Open Doors has, the longer you live in that house the less you have to pay back. So if they gave you $50,000, each year it’s 20% less that you need to pay back. So if you’re there for 5 years you don’t have to pay ANY of the money back.

GDW  Wow! I’m thinking it might be a good strategy if people are looking to move, maybe you move into a duplex or a triplex, Live in one unit and rent out the others. So that you are getting that money without having to trade time for money.

JOSH  Or do what you did. Get a townhouse and rent the basement out and live on the top two floors.

GDW  We absolutely did that. I was sharing with the realtors here, that we downsized a couple of years ago. We had three levels of a town home and I moved everything out of my basement. We made that into a legal apartment that became an income generator which makes me feel more comfortable in an economy that’s been going like this my entire career. *yo-yo*

CHONG  Actually, let me take some notes. How did you do that again?

ALL  Haha!

GDW  My husband, he’s also a smart guy. It’s strategy. Let’s talk about tax savings. They’re better here than in other parts of the country.

SHARIF  Yeah, we have another great local program that essentially allows you to get 20% credit on the mortgage interest that you pay. Effectively, it feels like you’re doubling your tax savings. So we have a lot of programs here and the good word is there are a lot of great incentives for people to buy now.

JOSH  There’s no reason to rent. Because you can’t write off your rent. If you can get a house and you can get your house payment around the same cost as your rent payment you’ll get the tax break. You end up making money buying a property instead of paying someone else who owns the property is getting the tax break anyway.

CHONG  And there’s something in DC as well, I guess I want to move to DC because it’s fantastic. If you’re a first time home buyer in DC, and a lot of people don’t know this, and Sharif reminded me of this. You can actually have 50% of your transfer costs reduced. There’s paperwork you have to send to the city, but you can have 50% of that. That can become a big credit in terms of buying your home

SHARIF You don’t need to have as much just for the cost in order to buy a property. Such great programs here in the district today and in the surrounding areas. We’re really happy to be able to talk about them and let people know that the American dream of home ownership is alive and well, with our great appreciation rates here in the local area too. It just makes it that much more of a slam dunk.

CHONG  Markette, do you need a tenant? Actually I would love to rent from you.

GDW  Ah, we’re good. You know DC has got it going on. So many people are moving in, but let’s talk after the show. I love everything that you’re sharing. I’m going to get some more ideas. Thank you. Please contact all of these guys for more information. Sharif, Josh and Chong are here to help navigate the current real estate market for you!

MEET THE REAL DEAL IN REAL ESTATE EXPERTS

Chong Yi, NMLS #198732
Producing Branch Manager
The Yi Team at Fairway Independent Mortgage Corp.
301-332-1810
chong@theyiteam.com
https://theyiteam.com

Josh Greene
Eastern Title & Settlement
https://www.easterntitle.net/

Sharif Ibrahim
Old City Properties
https://www.oldcitypropertiesllc.com

 

FIND OUT MORE

If you liked Buy a Home With No Money Down, you might also like this video to help millenials buy their first home. And if you’re deciding which loan is best for you, read is a 15 or 30 Year Mortgage Right For Me?

Ready to get started? Click here to Apply Now, or here for our mortgage calculators.

Shifting Real Estate Market

Shifting Market Planning

Serious tips from Santa Yi! Our best looking, ugly sweater winner!

What does a shift in the real estate market mean? Well, it doesn’t mean a crash. It actually can mean there are more opportunities for the people who are buying now. This is a good time to buy your rate down to get that dream home! Timing is everything in real estate and investing. Get started early to save money and take advantage of a shifting real estate market.

Chong Yi, The Yi Team at Fairway Independent Mortgage Corporation. Josh Greene, Eastern Title. Harrison Beacher, Keller Williams Capitol Properties. WUSA9 Great Day Washington, Real Deal In Real Estate, December 13, 2018.

Chong has more tips on investing in real estate here, How To Build Wealth.

Click here for our Mortgage Calculator. See how much home you can afford and mortgage tips, beyond a shifting real estate market.

As you can see, we like to have fun. Stop by our Facebook Page and see what we’re up to, beyond ugly sweater parties. We’d love to see you at our events!

Ho, ho, ho and wishing everyone a happy everything!