All Forum Posts by: Chris Mason

 If the debt is secured by the home being purchased, than it wasn't a cash purchase. Delayed financing would not apply, you'd have to wait the standard 6 months.

If the debt is secured by another house (cash out refi Property A to pay cash for Property B, for example), then it was a cash purchase, and you could do a delayed financing cash out refi in less than 6 months.

Pragmatically: Between the labor issues and everything else, we aren't really seeing people actually put up ADUs, or complete major non-cosmetic renovation, in less than 6 months, anyways (everyone has a whimsical timeline where they think they will take 2-3 months), making it moot. 

The mortgage industry has shed tens of thousands of jobs this year, and is set to shed tens of thousands more. That's relevant because the city that was the "arsenal of democracy" became "motor city," it has now  become in no small part "mortgage city" (there are people who's families have literally done that transition, across a few generations, from grandpa building the bombers to dad building the cars to kid putting together the mortgages). Rocket/Quicken, Homepoint, UWM, if you've purchased more than 1 or 2 homes you've heard at least one of those names (I could have listed more), and all are in Metro Detroit (Rocket/Quicken employs more people than anyone but the legacy auto makers and public school system). I'm in California and do mortgages, but if both Los Angeles and Detroit have an unusual weather event on the same day, it's a good 50/50 coin toss which one I will hear about first (I'd only hear about a Texas or New York or Kentucky weather event on the news), dependent on if I talk to a client/realtor in SoCal, or a mortgage account executive, first, even though I'm on the other side of the country from one of those two locations, and in the same state as the other.

Bust follows boom, so no surprise that mass layoffs are going on, but the "baseline" amount of mortgage business is going to be lower than pre-COVID 2019, moving forward. Which means I expect mortgage jobs in metro Detroit to be lower than they were in 2019 (each individual company is touting the line of "we're going to grow!" but they can't all be right, especially if total volume is lower, and the "we're growing!" line is a joke when uttered amid mass layoffs (amusing link), and stock valuations that are down >30% YTD across the board [see stock tickers: rkt, uwmc, hmpt]).

A part of that "baseline" is always refinances, but anyone that rate/term refinanced in 2020/2021 will likely not rate/term refinance again for at least 6-10 years, just as folks that rate/term refid in 2012 ("omg 3.375%, rates can NEVER get that low again!") didn't do it again until 2020 (...they did... but it was 8 years later).

I have no other specific knowledge about Detroit, just that one tidbit about one industry that's disproportionately located in that one city.

A quick google search of "lima one capital reviews" could have predicted this outcome as likely. None of the employees like working there, and a good number of the customers are pissed off customers.

My HP-12C confirms it's $845.37, assuming a 30 year term. The HP-12C is to mortgage people what the TI-83 is to algebra students. --> https://en.wikipedia.org/wiki/... 

However, that's back-end math. What you signed is what you agreed to, and if it specified $845, then that's your payment. If you and someone agree it's a $600k house because of some math, but sign a contract for $550k, then it's $550k, no different here. 

I'm not lawyer, my suggestion would be to get something in writing simply agreeing to make a final extra lump sum payment of $200 (or whatever it is) on the 360th payment, when it's refinanced, or whatever. 

 One of these days, I'll invent something that no one else has. One of these days.... :)

You-know-what rolls down hill. 2021 was full of builders notifying homebuyers of a choice: a) pay a new higher price, b) back out and don't buy our house, we'll just find someone else to sell it to, for at that new higher price. In both cases, basically all new builds were closing late, essentially no matter what. "Supply chain" bla bla bla.

I don't think misallocation of funds towards other project is necessary to explain the delay - if those other projects didn't have fixed-price contracts, or didn't have those fixed-prices as set in stone, and/or the other buyers were more willing to come in with extra money to get it done, then your project would go right to the back burner, pending materials prices coming down ("waiting game"). Meanwhile, materials prices have come down, but the labor shortage for folks in the trades is worse (depending on which numbers you want to trust), and general contractors run their businesses on debt, typically adjustable rate debt, so that 2% rate bump you are worried about -- they're already facing that.

There wasn't really a solution, just context. For the however many thousands of homebuyers of new homes in 2021 that got shafted, there was no solution for them. At some point in the future we may see class action lawsuits, who knows.

The developers building cookie cutter homes had the 'out' of selling the home to a different buyer, but in your case they can't do that, you presumably own the land, so you guys may be stuck in bed together to sort it out. 

Side suggestion: 

Guests walk in. One of the first things they will of course look for is the wifi password. Next to that is a tablet (with a bunjee lock thingie attaching it to the table/wall) and the words "pick me up!" 

Once they pick it up and swipe, they are greeted with the content you want them to see. And a tablet they are free to use, too, provided they want to stay within 2 or 3 feet of that location. And perhaps there's a universal devise charger too, similarly locked down, for the guests that forget/lose/etc their own charger. 

AirBnB will not have an opportunity to monitor this activity. 

Quick glance online has the bunjee lock thingie at $15, universal charger another $15, plus whatever tablet you want to go with (your old Android/iPad from 1-2 generations ago, gathering dust somewhere, would probably work fine).

Mortgage lending has errored more liberal of late, in response to significantly reduced refinance demand (one way to make up for a loss of business in Category A is to loosen guidelines in Category B -- if less people want to buy rice, then increase your pasta offerings in your grocery store, to grow your pasta business, to make up for the decline of rice sales). I would expect less difficulties now than before, for the typical consumer, in finding a lender that will not count an un-tapped HELOC towards DTI.

Take a vanilla mortgage option, like lender paid PMI. That'll bump the rate, but offset it by offering it as an adjustable rate mortgage, now the rate feels 'normal' for a 30 year fixed.

Throw a marketing spin on it. "No PMI, doctors only!" - and when they ask about why it's an adjustable rate mortgage, say it's "fixed for a few years, to give you time to finish residency" (as if it wasn't standard for adjustable rate mortgages to always be fixed for the first few years).

It's all just standard mortgage options anyone can get, though. We're seeing an uptick in such marketing efforts, re-spins of normal mortgage stuff, marketed to first responders, among other things, and so on.

2-4 unit real estate doesn't have PMI, so the standard doctor loan gimmick does not work, and that's why there aren't "physicians loans" for 2-4 unit. If you really really wanted one, I'm sure I or anyone else could drum up some nonsense, but as of now the market isn't sufficiently large, doctors more often want the big shiny single family house in the prestigious neighborhood, for whatever reason.

I've never been a doctor, but here's something I've noticed. If "Foo" costs $50, then "Foo, for mortgage brokers" is going to cost $125, but it'll have the "...for mortgage brokers" written on it (along with perhaps some other cosmetic customizations), to make up for it. I'm sure I will soon learn (concurrent to my financial demise) that if "lipstick" costs one thing, then "lipstick, but marketed at my teenage daughter" will cost a lot more.

 You're a realtor; why wouldn't you just follow the same advice for this topic that you give to your clients (whatever that is)? 

If you're already telling your clients to do this, do whatever you tell them to do.

If you're not telling your clients to do this, consider that if it's good for the goose, it ought be good for the gander.