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Mortgage On A Mission

We’re jumping in front of the camera on Great Day Washington WUSA9 to tell you a little bit about Jen Hansel’s battle with breast cancer, and Chong Yi’s experience with fundraising for American Cancer Society and Real Men Wear Pink, and Mortgage On A Mission.

Jen’s experience with breast cancer was a significant event for The Yi Team. It turned out to be the catalyst for Mortgage On A Mission.

WHAT IS MORTGAGE ON A MISSION?

Every month The Yi Team will be donating 1% to a charity. We work with a few charities here at The Yi Team. But we wanted this program to have a bigger impact. We wanted our borrowers to understand that every loan we process means a difference to a cause they care about. So we’re asking all friends and referral partners to add their favorite charity to the list and will have a drawing each month to select the cause that will be donated to.

Everyone is invited to participate in Mortgage On A Mission. Add your favorite charity to the drawing. No purchase necessary.

STRONGER IMPACT

To make an even stronger impact on the donation, we’re inviting the person who suggested the winning charity to join us on WUSA9 Great Day Washington to talk about it. Don’t worry! It’s a short segment that makes a big difference so be brave! We’ll coach you through it and the interviewers are wonderful.

HOW DID WE CHOOSE AMERICAN CANCER SOCIETY?

We’ve worked with American Cancer Society for many years. You’re probably familiar with Chong’s Real Men Wear Pink fundraisers. We wanted the launch of Mortgage On A Mission to be extra meaningful to our team, so it only made sense that we select American Cancer Society as the first recipient.

FIND OUT MORE ABOUT JEN

Jen Hansel shared her full story here. Everyone’s cancer story is different. Jen shares her story from diagnosis to treatment, including her choice to use Dignicap to save her hair.

STAY TUNED

We hope borrowers and real estate agents choose The Yi Team for our smart mortgage advisors. And we hope they’ll stick around because of the good that we’re doing!

Keep an eye out on social media for the #mortgageonamission!

Mortgage On A Mission

Planning for the new year is an exciting time for us at The Yi Team. Getting organized, focusing our efforts, putting it all down on the calendar. Our big project this year is Mortgage On A Mission!

Here’s the scoop: In the past you’ve probably seen a few posts and blurbs about the work we do with charities. It is something we all do behind the scenes of our every day mortgage business. Chong volunteers with Real Men Wear Pink and American Cancer Society. Erin donates time and effort to Heartly House. Derek raises funds for the Leukemia & Lymphoma Society, Maryland Chapter and Children’s National Medical Center every year. We’re also active with So What Else, our schools, local causes, and many others that we like to support. [Click here to read more about charities we work with.]

In the past, we quietly posted about a donation that we were delivering, or talked to you privately at a happy hour about a fundraiser we were working on. But we never made it the face of our business. That’s changing.

This year we are making our charity and philanthropy projects a more visible part of our business. Why? To have a stronger impact on causes you care about.

We want you to feel good about working with The Yi Team for 2 reasons:

When you’re working with The Yi Team, you and your clients are getting an amazing mortgage that will help build your wealth.
Every loan enables us to invest in charities who are working to create positive change.

LET’S TALK

You’re going to see a lot of conversation on our social media and your inbox. We want to know who you support and why? How does it benefit the charity? How does it benefit you? #MortgageOnAMission is our hashtag, keep an eye out for it!

HOW WE GIVE

Every month The Yi Team is dedicating 1% of our net monthly profits to a cause you care about. Add your name to the list below. We’re going to select at random a name from the list and donate 1% of our monthly sales to the charity of choice.

SPREAD THE WORD

To make a greater impact with Mortgage On A Mission, we’re inviting the monthly winner to join us for Mortgage Monday on Great Day Washington WUSA9. This will give you a greater voice to talk about your charity and how you support it. It’s also a terrific time for you to talk about how your business works to support this cause.

IMPROVING LIVES

The Yi Team has always been about helping people build their personal wealth through smart mortgages. Mortgage On A Mission is a reminder that it’s possible to make a bigger impact.

When you work with The Yi Team you’ll know that you’re working with a crack team of mortgage advisors that will custom build a mortgage that will start building your personal wealth.

You’ll also have that feel-good moment knowing that your loan is working to create positive change in the world.

HOW YOU CAN HELP

Want to get on board? It’s easy. Drop your name and charity info below, and you’ll be entered into the monthly drawing. That’s it!

Mortgage On A Mission

Your Name*
First Last
Your Email*
Name Of Your Favorite Charity. We want to hear all about it! Tell us the name of the charity. Do you have a specific contact there? How did you choose this cause? How do you help them?*
Charity Website

What is the charity's website?

Lend us a hand and share this with a friend! And say hello on our Facebook page.

Thank you!

Holiday Gift Guide

Building wealth isn’t just for grown ups! Kids can get in the game by learning how to be smart about money at an early age with books about moving and money. Our Holiday Gift Guide is a list of some of our favorite books about moving and money that would be a great holiday or moving day gift.

Holiday Gift Guide includes Berenstain Bears Moving Day — The Berenstain Bears Moving Day, by Stan and Jan Berenstain

Holiday gift guide ideas — Henry and Mudge and Annie’s Good Move, by Cynthia Rylant

Holiday gift guide includes sticker books — Moving House Sticker Book, by Anne Civardi

Holiday Gift Guide book ideas — My Very Exciting, Sorta Scary, Big Move, by Woodring PhD. Lori Attanasio

Our holiday gift guide includes "New Kid New Scene" — New Kid New Scene, A Guide To Moving And Switching Schools, by Debbie Glassner PhD.

Big Ernie's New Home is on our holiday gift guide. — Big Ernie’s New Home: A Story For Children Who Are Moving, by Teresa Martin.

You don’t have to be moving to talk to your kids about money and home mortgages. Teach kids how to invest in themselves instead of spending money on someone else’s wealth by renting. There are a bunch of great books about moving and money out there. Here are a few that we like:

Finance 101 For Kids: Money Lessons Children Cannot Afford To Miss. By Walter Andal.

The Kids Money Book is on our holiday gift guide — The Kids Money Book. By Jamie Kyle McGillian.

Holiday gift guide includes "Everything Money" — National Geographic Everything Money. By Kathy Furgang.

So whether you’re welcoming a new kid to the neighborhood, helping your child manage a big move, explaining how money and mortgages work, or looking for that smart holiday gift, take a look at our holiday gift guide and grab a great book about moving and money!

Click here to get on our Kids Corner email list!

At The Yi Team, we believe that a well planned mortgage creates long term wealth. Want to find out if you can build your long term wealth with a smart mortgage? Start your journey here!

Personal Story From Jen

Jennifer Hansel, The Yi Team home loans in Rockville MD. Face of Breast Cancer

The Face Of Breast Cancer, A Personal Story From Jen Hansel

Jen Hansel started in the mortgage industry 8 years ago. She orchestrates and communicates with borrowers, realtors and title companies throughout the processing and underwriting stages of a loan, making sure all the necessary documents and information are in the file so the borrower gets their loan approved. Providing an elevated customer experience is Jen’s specialty. Here’s her bio.

Jen has been battling breast cancer. Her story started with a routine mammogram on 11/14/18.

I remember saying to Erin (senior mortgage advisor and close friend), I just have to check this off my list before the holidays. Two days later I got a call to go for another test. The radiologist said, “I cannot tell what this is. You need to go for a biopsy”.

I went for that biopsy on December 2nd and was told I had breast cancer on 12/5/19.

After seeing a surgeon from John Hopkins, I learned I had HER2 positive and estrogen positive invasive ductal carcinoma. HER2 is a very aggressive kind of cancer but we caught it early.

Lots of tears and unknowns.

A double mastectomy was scheduled for 01/25/19. I had a port put in my chest in early March and started 12 rounds of Taxol chemotherapy along with a year of Herceptin which is a targeted immunotherapy which has high success rates with the HER2 positive cancer. Being HER2 is scary because it’s aggressive, but my doctor said it was good because then I could get the targeted chemotherapy.

I tried the Dignicap which ended up saving 70% of my hair- so thankful. It was painful and required long days, but was so worth it. It made me feel less sick keeping my hair. I finished Taxol on June 6th and celebrated that day!

July and August is when I lost my lashes and brows.

Onto 6 more months of Herceptin and reconstruction surgery, then hoping to hear the words Cancer FREE!

Jen has found a lot of support from her family and friends. She has also started an Instagram page for her Dignicap and breast cancer experience at www.instagram.com/dignicap_jens_story to help others know what to expect from chemo and what the Dignicap experience looks like. You can get to know Jen a little better from her bio, here.

Fundraising for American Cancer Society is important to Jen and the whole Yi Team, now more than ever. Jen’s experience has made this very personal to our office. She is one of the more than 266,000 women who will be diagnosed with cancer this year. Help us attack cancer from every angle by donating today. #realmenwearpink www.chongwearspink.com

Starting in 2020, The Yi Team is donating 1% of monthly net sales to a select charity. Enter your favorite cause into the monthly drawing and know that every loan enables us to invest in charities who are working to create positive change. #mortgageonamission

Coffee & Jam Podcast Library

Welcome to the Coffee & Jam podcast library! Senior Mortgage Advisor, Erin Finke discusses mortgage FAQ, home loan questions, real estate problem solving and more. Grab a cup of coffee and get ready for some smart tips with Erin and real estate pro, Alexandra Ross, Ross Residential RE/MAX.

Scroll down for the full podcast list.

Episode 28 | Planting Seeds
There is no box you need to be in to grow your wealth. You can be in any income bracket to leverage what you have to build your wealth. Buying a home is one of the smartest ways to get on your way to financial security. We’re talking about things you can do today that your future wealthy self will thank you for.

Episode 27 | Habits and Resolutions
January is the time for change and resolutions. Here’s Erin and Alex suggestions for best practices for New Years Resolutions. Find out how your resolutions can include buying a new home and increase your level of success by planning.

Episode 26 | 2020 New Housing Market
A recent article in Housingwire writes about what’s on the horizon for new homes next year. Erin and Alex review how home sales will look in our area in 2020. What will home inventory be? How do communities age? What are the suggestions for people who are looking to purchase next year?

Episode 25 | Slaying Dragons
Erin is back from Texas and shares her experience at the Dream Big Summit. She came home with lots of great ideas to improve her business. The two big topics she will implement to her daily practice is to host more client events, not just realtor events. The second is to focus on her business coaching and goal setting. Massive Impact Goals: MIGs.

Episode 24 | Changes Are Coming
What does a “Coming Soon” status mean on real estate? What does it mean to home buyers? MLS has changed the rules on this status. But there is a work around when you work with your mortgage company!

Episode 23 | Servant Leadership
How giving back can grow your business & bring a new meaning to your life

Episode 22 | It’s Normal To Be Scared
It’s 100% normal to be scared.

Episode 21 | Selling Strategy
Trusting the process to maximize your proceeds.

Episode 20 | Monopoly Money
What does the Federal Reserve rate mean to you?

Episode 19 | The Amazon Affect
How Amazon HQ2 will impact the surrounding area.

Episode 18 | Pause – Rewind – Fast Forward
The play by play of the August.

Episode 17 | Summertime Sizzling
The currently sizzle of our market!

Episode 16 | Can You Get A Gift?
Myths & Tips on gift receiving $$.

Episode 15 | How To Be Prepared
Listening to your real estate professionally will get you the home.

Episode 14 | Great Expectations
Every seller is a buyer at some point.

Episode 13 | Funding Fun Projects
We talked about about biggest bang for your buck, now we discuss funding it.

Episode 12 | Biggest Bang For Your Buck
Pools, Kitchens and Bathrooms.

Episode 11 | Safety Nets
We discuss the different types of contingencies in a contract.

Episode 10 | Up The Ante
How to make your offer stand out.

Episode 9 | How’s Your Summer Body?
Just like working out for that summer body, results are started in the winter. Same goes for the housing market.

Episode 8 | Pros and Cons of Technology
Do you find technology useful? We explain our pros & cons of technology.

Episode 7 | Declutter Your Home Before Moving
We’ve come to realize the amount of clutter and junk we actually have during the moving process. We discuss tips & vendors for making the moving process easier.

Episode 6 | Buying A House Without Your Spouse

Episode 5 | What Color Is Your Door Knob?

Episode 4 | On The Fence About Buying

Episode 3 | Time Management

Episode 2 | Human Connection

Episode 1 | Coffee and Jam Pilot

Thanks for visiting the Coffee & Jam podcast library. Have more questions? Erin Finke is happy to help! Contact her here: erin@theyiteam.com

More about Erin Finke.

Fall Market Tips

Fall marks an end to summer. But in the mortgage world it can be a fast moving time of year. Chong talks about Fall Market Tips with Ana Dubin and Bob Myers of The Myers Team, RE/MAX Services. They dip in to how the potential recession may affect real estate and mortgages.

GDW Summer is wrapping up and fall is almost here. There’s not only a change in the weather, but it’s not always a colder economic climate. That’s the good news.

GDW Chong Yi is back, along with Ana Dubin and Bob Myers of The Myers Team at RE/MAX Realty Services. Thank you all for coming.

GROUP Thanks for having us!

GDW So we’re changing seasons but you’re still saying that the market is still very good to go out and buy. What are some fall market tips?

BOB It is. We’re just finishing up spring market and summer. We’re dealing with buyers who are trying to buy homes before the school year starts. That’s one of the factors that we’re dealing with. Interest rates are very low right now, so that’s going to help the market considerably. What are your thoughts Ana?

“As long as your house is well priced and well staged, you will get quite a response.”

ANA Honestly a lot of people think that the fall is a big slow down against the hot spring. We’ve had an increase in terms of an uptick, as long as your house is properly priced. Bob just had a competitive offer situation last week. As long as your house is well priced and well staged you will get quite a response.

GDW The staging we talk a lot about. Bob, what are your tips for that?

BOB I know! I try to say to homeowners that they should think of how they would prepare themselves for a first date. That is the impression that you need to make when someone is walking through your house for the first time. You have one shot at a first impression.

GDW Inside AND outside. Inside is taken care of but it’s the outside is the first look.

CHONG That’s why I never get second dates! I never get second dates! I don’t listen to Bob. I’m a moron.

GDW We also talked about, if your house went on the market in early spring. Maybe they didn’t listen to their realtors and price it at what you suggested. Now is the time to lower that price? What is your best fall market tip?

“If you didn’t get the sort of response that you anticipated during this past spring, which was one of THE HOTTEST springs that we’ve seen in a while. Then you need to revise you price.”

ANA Definitely. If you didn’t get the sort of response that you anticipated during this past spring, which was one of THE HOTTEST springs that we’ve seen in a while. Then you need to revise you price. Listen to your agent. Have them walk though. Give you their honest feedback. We tend to be very honest with our clients, to a fault. We’re protecting their best interests.

GDW You guys are the professionals. You mentioned the interest rates. Chong, there are some big cuts there. It’s the lowest we’ve seen in a while? Where are we?

CHONG The Federal Reserve cut rates back in July. Actually end of July. “Back in July” like it was so long ago! Haha!

GDW Haha!

“Federal Reserve cut [rates] for the first time in 10 years…Interest rates are going to go low”

CHONG They cut it for the first time in 10 years. What that means, and this is the misnomer that many people think, it’s not directly affecting mortgage rates. It’s affecting the short term rates of how banks loan to other banks. But that does have a really big affect on how mortgage rates are derived. Essentially what they’re saying is they’re cutting rates because they see a little bit of weakness in the economy. By lowering the interest rates, they’re allowing more money to be lent to other banks so they can actually hire more and pump out more money into the economy.

CHONG So what does that mean for us mortgage rates-wise? It means that interest rates are going to go low. I don’t want to say the “R” word but I think we’re going to be going into a recession shortly. Shortly could mean 6 months, it could mean 24 months. The way we’re headed, that’s where we’re going. For us in housing, it’s a great thing. Interest rates are going to go lower. I don’t want to say how low, but low 3% potentially.

GDW How low can you go?

CHONG Exactly. So if you own an house now, oh my goodness, is the value of your house going to go up! And if you don’t own a home now, then you should be buying because what you buy today is going to be worth more tomorrow. That’s my fall market tip.

GDW Oh! I like that.

“Labor Day is also a time when the market picks up.”

ANA Definitely. Some of the people that I’ve been speaking to last year that have been pre-approved and kind of on-the-fence are much more motivated and coming back into the fold. They’re seeing now is the time to pull the trigger.

BOB Labor Day is also a time when the market picks up. Between Labor Day and Thanksgiving. After that is really the slowest time of the year, between Thanksgiving and New Years. Just for the holidays.

GDW Get your house out there now, before the rush. Great fall market tips.

CHONG Bob mentioned this earlier, the inverted Yeild Curve. We won’t go into that. That’s a whole other different conversation. But both of these guys have said this earlier. The amount of money you make on the sale of your home is paramountly dependent upon you have to listen to your realtor. If you price it too high, you’re going to make less. If you price it just right you could make more.

GDW In a bidding war!

CHONG Right, in a bidding war.

GDW Chong, Bob, Ana. Thanks so much for being here and sharing your fall market tips. As we head to the end of summer to the beginning of fall. If you want to inquire about a new mortgage or refinancing, contact Chong Yi of The Yi Team at www.theyiteam.com.

Want to know more about building your wealth with a well planned mortgage? Grab the password to our Free Resource Library, here!

For more information about Chong and The Yi Team, click here.

Click here for Ana Dubin and Bob Myers on Facebook.

Ready to apply now for pre-approval? Click here and hit the Apply Now button in the top right corner!

Find out what we’re working on today on our Facebook page.

Here are a couple more articles that you might be interested in. Then check out what everyone is saying about us in our Testimonials!

Maximizing Financial Literacy

Recession is Time For A Deal

Testimonials

Funding Fun Projects

Finding the funds to pay for those bigger projects can be a challenge. How do you update the kitchen? Put in a pool or great landscaping? A smart mortgage advisor will show you how to use the equity in your home. Start by finding out your home’s value. How much equity do you have?

Listen up to Coffee and Jam to get the scoop on funding fun projects. Transcript is below.

For the more Coffee and Jam podcasts, click here.

DO YOU HAVE EQUITY IN YOUR HOME?

EQUITY: the money value of a property in excess of claims or liens against it. – Merriam Webster

One of the biggest perks of home ownership is building equity over time. Our smart mortgage advisors will show you how to use the equity in your home to pay for those big fun projects.

Start by finding out your home’s value. How much equity do you have? Contact your realtor (your mortgage advisor can recommend one if you don’t have one). The realtor will be able to tell you the current market value of your home.

If the home’s value is in excess of the mortgage, you’re in luck! That’s equity you can use!

Your realtor will be able to give you a ballpark price for the renovations you’re planning. If the pricing is in your budget, here are two options to use your home to pay for them.

CASH-OUT REFINANCE

REFINANCE: Paying off one loan with the proceeds from a new loan using the same property as security.

Refinancing pays off your old mortgage in exchange for a new mortgage. Take that updated market value of your home (that you just got from your realtor) and consider it against the estimate for your big project. Maybe now is the time for a cash-out refinance? You can take money out with a cash-out refi and use it for your big project, which could help build the equity in your home.

PRO: There is only one lien against your property. “There is some value in having just one payment every month. And having the tax deduction on that payment” says Erin Finke, senior mortgage advisor.

HOME EQUITY LINE OF CREDIT (or HELOC)

“A home equity line of credit is different than a cash out refinance. It is a second loan on your property” says Finke.

PRO: “The great thing about a line of credit as you pay it down is you can access it again,” says Finke. “With a home equity line of credit you can go up to 100% [value of the home]”.

HOW TO DECIDE?

This can be overwhelming. Our mortgage advisors can help you make this big decision. There are several elements at play: different personal qualifying details and lender rules may make a difference.

ALWAYS BE IN THE KNOW

Knowing the value of your home helps you understand your mortgage better. We like to send our clients a monthly email with an updated value of their home. It helps you manage your most important asset and shares tips on how to save money for the next big project.

CHECKLIST

Call your realtor and get an updated home value.
Ask your realtor for a ballpark estimate of what they think your project would cost.
Call your mortgage advisor.
Start on your project!

Looking for more information on building your wealth with a well planned mortgage?

Enter our Free Resource Library!

Click for PDF Version.

TRANSCRIPTTRANSCRIPTTRANSCRIPTTRANSCRIPTTRANSCRIPTTRANSCRIPTTRANSCRIPTTRANSCRIPTTRANSCRIPT

ERIN Hey

ALEX Hi

ERIN It’s Thursday, June 13, 2019.

ALEX Do you remember that, you call in for the weather. That’s what you sound like right now.

HOW TO USE YOUR MORTGAGE

TO FUND BIG PROECTS

Are you planning a new pool or landscaping project? Maybe a kitchen renovation or addition is in your future? Finding the funds to pay for those bigger projects can be a challenge. We can help.

ERIN Oh, my gosh! You’re right. Or the time? Isn’t that weird that you would call in for the time? The time is nine thirteen. At the tone the time will be nine thirteen am. Beep. And then it would keep going.

ALEX Yes! That’s what you just sounded like. No one knows what the heck we’re talking about.

ERIN Sorry. I apologize in advance.

ALEX Yeah. It’s kind of like that commercial. On the news? It’s right before the news. The time is…

ERIN Yeah.

ALEX The temperature is….brought to you by…

Funding Fun Projects

ERIN So thank you for the last 50 seconds, 51 seconds that we have brought beautiful content to you. No! Let’s jump right into our topic today. Last week we talked about improvements in Biggest Bang For Your Buck. Today we’re going to unpack that a little bit further and talk about how to access the funds needed for improvements and the first few steps to take.

ALEX Yep. So what do you want to call it? How To Pay? How to Finance? How To Fund?

ERIN Yeah. How To Fund The Fun Projects. Funding Fun Projects.

ALEX How To FF.

ERIN Oh Jesus.

ALEX FFE!

ERIN So last week we talked about kitchens, baths, we touched on pools. And the return on investment for those things. We also talked about Jen and how she wanted to do a whole master. And I’m still trying to convince her just to do it.

ALEX We should do a vote. Like on Facebook. https://www.facebook.com/theyiteam/

ERIN Everyone is going to say do it.

ALEX Yeah.

ERIN It’s her forever home, they’re not going anywhere. It’s just jumping in.

ALEX At that point lets just knock it down and start over.

ERIN A McMansion. The house is huge as far as square footage. It’s just that they have a lot going on. I’m going to encourage her once everything has settled down because I know that would bring her a lot of joy.

Do You Have Equity In Your Home?

ERIN So that being said, if you have the ability to access equity in your home, and what that means is that you have an equity position in your home where there’s some cash available. Now I would recommend if you want to know if that’s possible to contact your real estate agent. Because you would be able to tell them where their home sits on the market today. What’s their value. There would be an appraisal that would come into effect.

ALEX Yeah. And then how much they owe. And what the current market value is. And an appraisal.

ERIN So all of those things to start the conversation to try to figure out what it is you want to accomplish. If you’re like me you wouldn’t know what that is going to cost. I don’t know anything about costs of construction or any of that. So my first step would be to find out what I want to do and then talk to a professional who may be good, not necessarily to price it out, but who could give me a ballpark. Alex you would have an idea.

ALEX Couple big bids.

ERIN Yeah, even before bids. Like if I said, Alex, I want this new kitchen you would have an idea. Ballpark like, all right if you want to do this it’s going to cost you $25,000, or whatever it is.

ALEX Whatever it is.

Funding Fun Projects With A Cash Out Refinance

ERIN Maybe it’s a little bit more, maybe it’s a little bit less depending on little details that are chosen. So basically the first step is figuring out what your property is going to be worth as a ballpark. And that’s going to be a deciding factor in you moving forward. You can always take cash out of your property. You need to do a “Cash Out Refinance“. You could also take out a Home Equity. A Home Equity Loan is different than a Cash Out Refinance where it’s a second loan on your property. Depending on your specifics, one may make more sense than the other. It just depends on your circumstances. So if you do a second loan, it’s a Line Of Credit.

ALEX That’s what I have.

ERIN Yeah. So as you pay it down, you can access it again. So there are some benefits to that.

ALEX Correct.

“There’s some value in just having one payment every month.”

ERIN For a Cash Out Refinance, you still just have one loan. There’s some value in just having one payment every month. And having the tax deduction on that payment. So, those are all unique to each person applying and the goals that they’re trying to meet.

ALEX Is there a cap?

ERIN Different programs offer different things. With the Home Equity you can go up to 100%.

ALEX Really? Fantastic.

ERIN Yeah. There are just different personal qualifying details that need to be met. You need to qualify and the lenders themselves have rules. We at Fairway don’t actually do stand alone Home Equity Lines Of Credit. We can obviously put you in touch with some people who do them. So that being said, I want to blow out this wall in my living room and I want to do a huge island with a big slab of marble and I want to do blah, blah, blah. Alex, I’m going to call you and you’re going to say, “okay great! I know Mr. Smith who’s the contractor”. How does that work?

ALEX Kind of like what you just said. It’s a little more in depth with ethics. I have to make sure that their license is up to date. This is boring logistics but I have to put it out there. I have to make sure their license is up to date. Then I have to email the contractor’s contact information with their link to the license. I do have a rolodex of people. And if you ask me ballpark number I’ll be able to give you an idea of what it’s going to cost.

ERIN I would say that’s probably unique to you too, because you work with a lot of developers. Versus just a regular resale real estate agent who might not know. I would say that’s a strength that you would have.

ALEX If you were to call and say that you wanted to put hardwood floors everywhere. Who is the best company around? I would be able to get you in touch. Things like that, that’s easy. Now when it comes to actually pulling permits and stuff then I have a whole thing. What people don’t realize is you may want to do one project but it could involve four different types of contractors.

ERIN That’s so true!

“The most expensive part of a project sometimes is the permits.”

ALEX And the most expensive part of a project sometimes is the permits. Especially when you want to move things.

ERIN I didn’t even think about the permit part. So please speak to that. Let’s say I call you and I want to take…it’s my house! It’s my property! I have to get permits for work that’s being done inside my home?

ALEX You actually have to get a permit if you change out your toilet. Yeah, Montgomery County requires a permit for almost everything. https://www.montgomerycountymd.gov/dps/

ERIN No way! So I had no idea.

ALEX Yeah. And if anyone ever fact checked it. Say you put another kitchen in the basement and you never pulled a permit.

ERIN And you try to sell your house.

“You can get a permit afterwards.”

ALEX You can get a permit afterwards. You can. Typically the seller would pay. You can get a permit after the fact. I would just not advise that scenario, which we have right now going on.

ERIN So I’m going to go off on a little side road here to give you an example I just thought of as you were talking about these requirements. We’ve had situations before where people have refinanced or asked to refinance. Guess what, they’ve closed out their garage to make it a mini kitchenette.

ALEX Whatever, yeah.

ERIN And now there’s no access now to the main house from it. They created their own little space. They took out the garage door. They put in bay doors. They put in a kitchenette. They did plumbing. None of it was permitted. Guess what, now it’s a two unit property, it’s not a one unit. It wasn’t an accessory unit either. The point is, they didn’t know it wasn’t okay. Had they contacted their real estate agent and said this is what I’m looking to do…

ALEX It’s interesting, because a good contractor will actually know that.

ERIN These people in particular were doing the work themselves.

ALEX That’s the only thing. I’m not knocking DIY projects. I would just confirm with either a real estate attorney, contractor, maybe a real estate agent one what you do and do not. Or, go to the county and ask what you need permits for. Because you really do need a permit for almost everything.

ERIN So how much do permits cost?

ALEX It all depends on the project and the scope of the work.

ERIN Really? So how does it work? Someone comes out and…You say I want a permit because I want to put on a…?

ALEX Usually a contractor will let you know what kind of permits you will need. If you just want to move a non-loadbearing wall, no problem. If you want to move structural walls, then obviously you would need a permit for it. If you want new wood floors, you don’t need a permit for that. Anything that involves the…

ERIN The structural integrity?

ALEX Yeah.

ERIN Makes sense. It’s a safety issue.

ALEX Which is why a toilet is part of it because it’s the plumbing.

ERIN Interesting. There’s so much I don’t know in regards to real estate!

ALEX A lot of agents don’t know that either until you get into a situation. Or if you’re like us and the stuff you deal with.

How Long Does It Take To Get A Permit?

ERIN What’s the timeline? From the time that you file for a permit and …?

ALEX It depends. Sometimes they’re quick. Sometimes you can get them back in a week. Sometimes they’re a little slower. It also depends on what you’re doing. If you’re just doing a quick kitchen renovation then yeah, you might get a permit quickly. Three weeks. Now be careful on the outside renovations because if you’re in an HOA, or you’re in a certain neighborhood. Or to put a pool in in the county, if you are within X amount of acres of your neighbor you need them to sign off. Same thing with a basketball court or tennis court.

ERIN Interesting. So that’s an HOA thing or that’s a permit thing?

ALEX That’s a permit thing.

ERIN So when we put the deck on our house last year, obviously we needed a permit. But the people who did the deck did the permitting.

ALEX Yeah!

ERIN So there’s a cost to that and they paid for it. That’s the idea? It’s probably built into my bid. So you mentioned neighbors signing. I had neighbors signing for HOA. That’s not permits, that’s just HOA to be okay with the deck.

ALEX Yeah.

ERIN So interesting. I believe it took a week or two for the permits. Once the permits were done then they had to do footers. And then that had to be inspected too.

ALEX So everything needs,… like a deck every process, every step of it would need to be inspected. And if you fail inspection.

ERIN Definitely took some time, longer than I thought it would. I think we started in March. I think that was when I went under contract. And it wasn’t built until the first week of June. Like Memorial Day weekend.

ALEX Wow.

ERIN But it had to do with, I don’t remember why exactly. It only took a week to build the whole thing. But to start took a long time. I guess the HOA was like a 25-30 day thing that I had to do.

ALEX Because you have to wait.

ERIN Because I had to submit it. Put all the paperwork in. I had to get a survey. All those things. So the point here guys, is if you’re going to be doing projects you just need to start from square one. What is it that you want to achieve? Then talk to the professionals on what steps you need to take reverse engineer that and figure it out.

ALEX Make sure you get permits because it will come back to bite you in the ass if you want to sell your home. And you find out there aren’t permits, the buyer finds out there’s not permits.

Find Out If It Was Permitted

ERIN How would a buyer find that out?

ALEX Om my god, it’s so easy!

ERIN So I’ve had people who have sold homes and been like I’m going to sell my house. But I didn’t get a permit when I built my deck.

ALEX So it’s really easy. If depends on the county. Like if it’s in Montgomery County, just go to Montgomery County Building Permits. Type in the address. https://www.montgomerycountymd.gov/DPS/index.html

ERIN So it’s all public record?

ALEX It is. Everything is public record.

ERIN Wow!

ALEX Type in the address so you can see the status of the permits. You can see the value of it as well.

ERIN Interesting.

ALEX I know!

ERIN All stuff I didn’t know!

ALEX I know! It’s fun. It can be. That stuff excites me more.

ERIN You’re a developer though. You like the project. And project management.

ALEX I do. I like telling people what to do. Haha!

ERIN Haha! We all know Alex. We all know. But it’s to orchestrate the whole project. You do need advice. You’re not, you do that for a living. That’s exactly what you do for a living.

ALEX Yeah, and I’m not going to charge you for advice. That’s the other thing. That’s the problem. A consumer assumes that to bring someone in it’s going to cost them. It’s not going to cost much honestly.

ERIN It’s probably going to cost more if you don’t have a conversation with a professional first. Long term.

ALEX Exactly. Anyway, that is today’s fun little tidbit. Funding Fun Projects.

ERIN So what questions do people have. Something that is specific to you in regards to a project. Maybe planning a project out for the future, let us know. We can definitely speak to it. I think it would be really good to get some real life examples. And actually go through step by step in one of our podcasts.

ALEX If anyone wants to know. We often get questions about what upgrades, what renovations should I do?

ERIN Right. And what materials? That’s a huge one. Because people don’t know how to leverage that investment. You could easily do a very expensive renovation with materials that’s not so great. And then it’s a huge flop. Right? Again, talk to a professional please!

Coffee and Jam

ALEX Please do! Your coffee smells amazing.

ERIN Thank you! It’s just my Donut Shop hazelnut. My big boring.

ALEX Shout out to Donut Shop. Isn’t that with the two E’s at the end?

ERIN I think so. I just get it at Giant. 36 K cups for $17.99.

ALEX There you go!

ERIN That’s what I’m going to do! I don’t know if we talked about it last time. But that stuff from Wegman’s I did try it!

ALEX And?

ERIN It was pretty good. For next week’s I’ll bring in a couple and we’ll sample them.

ALEX Okay. Cool. Until next time… bye!

ERIN Bye!

Looking for more information on building your wealth with a well planned mortgage? Enter our Free Resource Library!

Digital Mortgage Revolution

How does the digital mortgage revolution impact you? We use high tech tools and gadgets to help you have a better understanding of your loan options. Chong invites Dave Savage to the show to talk about Mortgage Coach and Total Cost Analysis.

GDW It’s Mortgage Monday which means its time to get the best tips for home buying and refinancing. I’m here with Chong Yi of The Yi Team at Fairway Independent Mortgage Corp. He is joined this week by Dave Savage, owner and founder of Mortgage Coach. He’s a mobile tech pioneer who’s committed to educating and preparing lenders for the digital mortgage revolution. Welcome to both of you!

CHONG Hey Kristen.

DAVE Nice to be here.

The Digital Mortgage Revolution

GDW Chong nice to see you, Dave great to have you here. I want to start with you. Mortgage Coach. What is this all about?

DAVE Mortgage Coach helps the best loan officers provide the best advice to families who are thinking about buying a home or refinancing a home.

GDW So it’s taking something that could be very complicated or convoluted for home buyers, for first time home buyers especially.

DAVE Oh, it’s stressful! Rent vs. Own analysis. Helping families make a better decision around the mortgage and around home ownership.

GDW So what made you decide to create this?

DAVE I was a loan officer once upon a time. And it was one of those things where “I wish I had this better way of doing things”. That led to the invention of Mortgage Coach, almost 20 years ago.

CHONG Well with Chong we talk all the time about how home buying and refinancing has gone into the digital age. We talk about the online listings and postings. This is just a continuation of that. Making it easier and less stressful. Not just for home buyers, but for you as well.

CHONG Absolutely. Music to my ears. I’ve got to tell you this is a huge honor for me because Dave, and he may not know this, but he’s been a mentor of mine for a very long time. And his, or “our” Mortgage Coach, right?

DAVE That’s right. It’s yours now.

Understanding Your Loan Scenarios

CHONG It’s the greatest technology. It’s been a game changer for me because what it does is, it separates the average loan officer with the new digital mortgage advisor of tomorrow. But what it really does, is it helps us illustrate the benefits of certain loan programs and loan scenarios. [See Maximizing Your Financial Literacy for more about loan officers and mortgage advisors.]

GDW Okay.

CHONG It allows us to [see graphic] to give different options so we can maximize both your short term and long term wealth as it relates to your mortgage and the owning of your home.

GDW And lays it out so simply for those of us in layman’s terms.

“Should I pay points? Should I not pay points? Should I do a 5 or 30 year loan?”

DAVE Our goal is to make the loan officer the hero. They’re providing options beyond the average loan officer and help the family make a more confident decision. It’s like “oh wow, the mortgage is confusing. Should I pay points? Should I not pay points? Should I do a 5 or 30 year? ” Make it easy for the family and make the loan officer a hero.

CHONG Yeah!

GDW So home buying is stressful. Someone wants to know that they are getting into their dream home the right way. Paying the right amount of money. They want it to be a nice smooth transition, which is what you guys want for the home buyer or home seller to feel as well.

Your Mortgage Is Not A Commodity

CHONG Absolutely. Nowadays there is a commoditization? The idea of the mortgage becomes a commodity. In actuality it should be looked at in another way. Nowadays you can go online, get a loan. You can walk into a grocery store and get a loan. Right? But getting a mortgage is not like buying toothpaste or buying anything at a grocery store. It affects you long term. It affects your finances and how your wealth is going to be created, over the life of your world, your financial world. So for me, for us, we’re looking at a different way to convey our message. I can talk about what we can do with certain down payment strategies. But at the end of the day, it’s hard to convey that. It’s hard to illustrate that. Now we have something that’s kind of cool. With the video. Mortgage Coach in general give us so many things that we can do to make it easier for you to understand.

GDW The thing about home buying is it’s a visual process. You’re buying something visual. That’s why the staging is important. That’s why all of this is important. You’re adding to that to make that visual. That’s what we’re in there for.

“We take those things that can be complex, things that most loan officers don’t even talk about…We make that easy.”

DAVE Yeah, visual. I think a lot of families just think about monthly payment, cash to close. They don’t look at, what’s that going to cost me over 5 years? And which loan is better? Should I prepay my mortgage so that I pay off my home faster? Should I invest that difference? We take those things that can be complex, things that most loan officers don’t even talk about. Most families don’t even know to ask about. And we make that easy.

CHONG Yeah.

GDW For refinancing as well?

DAVE Absolutely.

CHONG 100%

GDW It’s a major tool.

CHONG The refinancing part is awesome because we can say, in a lot of cases, all right even if you’re getting a higher interest rate, let’s talk about if you were to pay down some debts. Let’s look at the overall liabilities compared to where it would be. Too often times as consumers we’re putting different buckets of liabilities in different buckets. You can have your mortgage, you can have your credit card, you can have your car loan, you can have your student loan.

GDW Right.

“At the end of the day you’re going to have a bigger return on investment and you’re going to pay less overall.”

CHONG In actuality, if your mortgage payment goes up, and you’re able to pay down or pay off the other debts. At the end of the day you’re going to have a bigger return on investment and you’re going to pay less overall.

GDW Oh! Okay.

CHONG And Mortgage Coach allows us to illustrate that.

DAVE It’s a Total Cost Analysis. So families are looking to get a loan. Don’t just get a fee worksheet! With only one option, closing costs. Get a Total Cost Analysis showing the cost over time.

Chong’s Shoe Analogy

CHONG Can I make an analogy? I messed this up last time. It’s my shoe analogy.

GDW Go ahead, you’ve got time.

CHONG I know you love shoes. I do too. There are so many shoe options that are out there. The problem we have is that not every shoe fits every person. So the technology that we have with Mortgage Coach and Total Cost Analysis allows us to identify the best shoe that fits your foot.

GDW That’s a good way to end on that one! Chong and Dave, thanks so much for being here and informing us. If you want to inquire about a new mortgage you can contact Chong Yi and The Yi Team at www.theyiteam.com

Want to see more Dave Savage? Here’s Chong’s interview on Mortgage Coach, Modern Mortgage Experience.

The digital mortgage revolution is available to all of our borrowers. Give Chong a call to use these great tools to help you build your long term wealth. Find out more about The Yi Team and our mortgage advisors, here.

Go to our Resources page for mortgage calculators and glossary.

Mortgage Monday originally aired July 15, 2019 on Great Day Washington, WUSA9.

Special thanks and shout out to Dave Savage. Appearing on Mortgage Monday with me was a huge honor. I appreciate you sharing your expertise today, and your continued mentorship!

Maximizing Financial Literacy

The mortgage advisors of The Yi Team are all about financial literacy and advising borrowers for their best home loan. All of our clients are fitted like Cinderella’s shoes!

GDW Welcome back. It’s time for Mortgage Monday and we’re joined by The Yi Team, Chong Yi, Erin Finke and Derek Harman. Welcome to Great Day Washington.

CHONG Hey Markette.

ERIN Thanks for having us.

GDW I’m excited to have you here because just last week the Federal Reserve, Chong, announced that they were not going to raise interest rates. What does that mean for people that own homes or who are thinking about buying?

CHONG As we talked about last week, nothing at all. It’s exactly what we anticipated. I think we’re still headed towards a recession. The Fed not raising rates this month is really setting it up for next month in July when it’s expected. Unexpected news creates havoc in the market. We were all expecting it, exactly what happened. So interest rates are going to go down, we’re going to go into a recession. Six months to 18 months to 24 months and we’ll be in good shape. Home values are going to go up, interest rates are going to go down. You’ll be in great shape.

GDW So you brought your team of experts here, Erin and Derek, to explain to homeowners how they can use their mortgage as a tool for investment throughout this recession. We want to ride on top of that wave and not be wiped out. How do you provide financial literacy for your clients?

CHONG I’m very excited to have Erin and Derek. Not only are we a team, but they’re family to me. I know we don’t look a lot alike but,

ERIN We are related.

CHONG We are related. I’m so excited because they are the future of our industry. Me, I’m not calling it quits yet, but I’m know I’m getting there. They are the future of the industry. We’re here today to talk about what the difference is between a mortgage advisor and a loan officer is.

GDW Ok.

CHONG For example, Friday we were talking about what happened at the end of the week and we came up with some stories. And Erin had a really good story about one of our buyers.

PROVIDING FINANCIAL LITERACY

ERIN We did. We had an awesome success story. So one of the things we like to do is get together and talk about great impacts we make on our borrowers and our referral partners. Specifically last week we were talking about a situation where we had a borrower who came across our desk who had been turned down a couple of times for a mortgage. They were finally get pre-approved for a mortgage, or pre-qualified I should say, with another lender. It turns out that the other lender didn’t do all of the research that needed to be done and pre-approved them for a loan they could no longer do.

“Hey, can you save the day?”

So we got it in front of us. One of our awesome referral partners called and said, “hey, can you save the day”? We looked at it. Went through all of these different options. We put a plan together to do a credit rescore with the borrower so they could now qualify for a conventional loan instead of a government loan. We put these steps in place. Just a couple of weeks later, they ended up closing on their home with no problem, with no worries. All their financing went through perfectly because we put a plan together and saved the day. So that’s a great success story.

Their financing went through perfectly because we put a plan together.

GDW That’s a hard working team. A lot of people would look at that and say that’s a lot of work to fix this. But this doesn’t offer them any financial literacy. You you guys say, yes, let’s do this and make the people happy.

ERIN We love doing that.

DEREK Yeah. It’s such an important decision for people to make. Financing is one of the most stressful times in somebody’s life. It’s a big financial decision for them. To take the time and actually guide someone through the whole process is actually what we focus on. It’s not just a transaction. It’s something that we really take our time on. It’s not always getting pre-approved for the maximum amount that you can get. It’s a smart decision. You have to think about child care, you have to think about all the other expenses that you have, that you have to be responsible for. Us trying to find a product that works is really important to us.

There’s A Big Difference Between A Loan Officer And A Mortgage Advisor

GDW Is that the difference between a mortgage advisor versus a loan officer?

CHONG I think I’ve said this a bunch of times. Absolutely. Now you can go into a grocery store and apply for a mortgage and actually get one.

GDW Really? Okay…

CHONG Great. Everything’s great. You get the low interest rates and all that. At the end of the day, you’re mortgage isn’t just debt. Most people are treating it as debt. In actuality, it’s an investment vehicle. It’s a way to purchase an asset with very little out of pocket investment, that you couldn’t do otherwise. You should really look at that as it relates to your overall financial health and growth. We want to put you in a mortgage that is exclusive to you as opposed to let’s just give everyone the same loan.

GDW And that will protect you as we head into this recession. Like you both just said, you don’t just want to get as much money as you can possible get. Get the money you need and then use that mortgage as a tool.

DEREK You’d be surprised how many people think “oh, I have to put 20% down”, or “I have to make this huge cash flow investment”, but you don’t. There are so many products out there that can get you into a mortgage. So instead of paying $2500 a month in rent you’re investing in something that will last you a long time.

The right home loan is like buying the perfect pair of shoes.

CHONG It’s like buying a pair of shoes.

GDW Okay, you’re talking my language now.

CHONG Anyone can go to a store and buy a shoe. But is it the one that really fits you? That works with what you’re wearing? Is it your style?

GDW So if you want to be Cinderella and fit into the perfect shoe that is your mortgage, inquire about getting a new mortgage or refinance just contact Chong Yi and The Yi Team at Fairway Independent Mortgage Corporation at theyiteam.com. Build financial literacy with a mortgage advisor who offers a custom fit for your home loan mortgage.

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Ready to talk to our mortgage advisors? Click here.

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Biggest Bang For Your Buck

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

For more Coffee and Jam podcasts, click here.

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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MORE COFFEE & JAM

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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

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Recession is Time For A Deal

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

[Want to know more about building your wealth with a well planned mortgage? Click here for our Free Resource Library password!]

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.

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Human Connection

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

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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!

Ready to know more about building your wealth with a well planned mortgage? Click here for our Free Resource Library password!

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

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.

For more Coffee and Jam podcasts, click here.

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.

Want to know more about building your wealth with a well planned mortgage? Click here for our Free Resource Library password!

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

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.

For the full list of Coffee and Jam podcasts, click here.

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!

Know more about building your wealth with a well planned mortgage. Click here for our Free Resource Library password!

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

Scroll down for the transcript and links.

Ready to know more about building your wealth with a well planned mortgage? Click here for our Free Resource Library password!

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.

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

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