The Accunet Mortgage and Realty Show
The Accunet Mortgage & Realty Show 6-2-24
The following program. The ENT , mortgage and Realty Show is paid for in full by ENT mortgage, LLC and equal housing lender consumer access.org number 2 5 5 3 6 8. The advice and opinions expressed during the Academic Mortgage and Realty Show are solely that at the hosts and guests of ENT mortgage, LLC, and not WTMJ or Good Karma Brands.
Speaker 2:Welcome to the Accu Net Mortgage and Realty Show, getting you inside information on buying, selling, and financing your home with expert advice from Accu Net Mortgage and Realty. And now here's Brian and David Wickers. Welcome
Speaker 1:To the Accu Mortgage and Realty Show. I'm Brian Wicker, licensed real estate broker with Acuate Realty Advisors, and also the majority owner of Acuate Mortgage, where my individual NMLS ID number is 2 5 9 6 1 oh . I'm here again today along with my son David, who is one of our senior loan consultants at Academic Mortgage. And David's individual NMS ID number is 3 2 8 8 4 7. Alright , David. So , um, you know, mortgage rates are up a little bit , uh, the last week or so, just kind of drifting higher for no really significant reason. Um , just kind of waiting for inflation news. Yeah. And, and, and yet despite that, we had a ton of people this week , uh, get accepted offers, which is awesome. And, and so, you know, serious buyers are not deterred , uh, by a slight drift higher in interest rates. Um, what, what did we learn this week in the , you know, in the world of economic news that would influence mortgage rates? What
Speaker 3:I, and to paraphrase your, it has been a paucity, is that your favorite word? I
Speaker 1:Love paucity.
Speaker 3:Well, there are two primary data points that move markets on a monthly basis. The first Friday of the month, jobs report coming ,
Speaker 1:Oh, that's gotta be coming up. But here , this , that's coming up Friday.
Speaker 3:This coming Friday. And the CPI Consumer Price Index report, well, last week, neither of those were there and it wasn't there. I'd have to, maybe the week before was CPI. Yeah. But we're kind of in this gully of
Speaker 1:Market data. Yeah.
Speaker 3:And so markets are kind of like grasping like, oh my , what should we care about while we wait for the next, you know, post and the next post is coming up on Friday. And so it's been this, you know, gyration up here, down there, up here, down there on Friday, the, I think this is the Bureau of Labor Statistics reported core P-C-E-P-C-E is the personal consumption expenditure, which is allegedly the Federal Reserve's favorite report as a measure of inflation. The reason why is because PCE is, well what did you, you had to buy that used car, what did you spend? Yeah. CPI is, we're gonna measure everything, even if you didn't have to buy that loaf of bread. Right . You know, in the last month that came in at 0.2 , forecast was 0.30 . But the , there's a rounding element to this. It . Point two , they had to round down from 0.24900 . So it was like, oh man , man , a big round, good thing that nine was there. 'cause otherwise it was 0.25 and then you'd round up to 0.33
Speaker 1:Enemy bad . Terrible. So remember folks, inflation is the enemy of interest rates. Yes. And that's what the Federal Reserve is waiting on to see that inflation is going down. And wouldn't we all love to see that we all , of course we all would.
Speaker 3:Well, and, and members of the Federal Reserve Open Market committee, you know, they make speeches. Yeah . They get invited to, I dunno , clubs, places to speak
Speaker 1:The Rotary Club. Well ,
Speaker 3:Exactly that . They're just like Yep . Waiting on the data. Like when the data arrives, then we'll, you know, take the foot off the gas
Speaker 1:Or off the break . Sure. Maybe it's foot off the break . But at , at any rate, you know , uh, I'm just , uh, I'm working with the first time home buyer and just to give folks an idea of where the interest rate is , uh, this is with 10% down. She's got excellent credit. Uh , a $258,000 loan amount, we could deliver an interest rate of 7.125. Yeah. Uh, and , uh, the a PR on that would be 7.34 because there's an element of private mortgage insurance Yeah. In there. But the underlying rate is 7.125. Now, she's gonna have a nice surprise when I call her again to say, Hey, you know what, now that you're maybe looking in a little lower price range , uh, she's gonna qualify for Wisconsin's special first time home buyer program. Hmm . 6.125 is there, and , uh, that is gonna move her payment by 170 bucks. So that's gonna be all
Speaker 3:That because she's talking to a good mortgage carpenter. Correct. And not just, you know, an order taker.
Speaker 1:That's right. So, so inflation, you know, kind of, we're in a holding pattern. Serious home buyers are still out there now, unfortunately, and I want to tell a little bit more of her story maybe in the next segment. We are still seeing multiple offers. Of course. And remember, all real estate is local in the Milwaukee area. We are still seeing properties get multiple offers. Not the case everywhere. So always be careful when you're reading national headlines as to what are they really talking about. I had gotten a call , uh, from a friend of mine who's a real estate broker in Naples, Florida. Mm-Hmm . <affirmative> , which used to be a hot market. Now the average days on market is 69 days. That's, which
Speaker 3:Again, like you said, has nothing to do. Are you looking for a home in Whitefish Bay? Yeah . And the $700,000 range, doesn't matter what's happening in Naples, Florida.
Speaker 1:Yeah. The averages are misleading. By the way, I happen to have run the numbers for Whitefish Bay , uh, in May. There were 20 so far. This is , this is incomplete data. But the average days on market for the 26 homes that were recorded in the MLS, you wanna guess
Speaker 3:Seven hours?
Speaker 1:<laugh> ? No, it was seven days, continuous days on market. But , uh, you know, and , and the average for the whole metro Milwaukee area is 28. Okay . So anyway, all real estate is local and with even within your submarket. And when we come back, I'll tell you a little bit more about , uh, my first time home buyers experience. And we also wanna do a , a mop up segment on divorces. You are listening to the Academic Mortgage and Realty Show on AM six 20 WTMJ
Speaker 2:Home buying advice from the guys who know it best. This is the ACU Net Mortgage and Realty Show with Brian Wicker on WTMJ.
Speaker 1:Welcome back to the Academic Mortgage and Realty Show. I'm Brian the Elder, that's David the younger over there. And , uh, David, I , I've been working with a first time buyer , um, who is writing offers on properties that are listed in the mid to upper two hundreds. And so , um,
Speaker 3:That's , it's gotta be fierce.
Speaker 1:Well, lemme tell you how, how fierce is it? Do you wanna be , uh, ed McMahon? Yeah , ed McMahon. Okay. I'll be Johnny Carson. The answer is, well , uh, um, two weekends ago she wrote an offer on a house listed for , um, two 80 and she wrote 50 grand over with 10% down and was offering $10,000 of appraisal gap. So that's where you say, Hey, I'm , I'm willing to pay you three 30 for the house that you've listed for two 80. Yep . And I'll still buy it for three 30 , even if it appraises as low as three 20 mm-Hmm . <affirmative> . Okay . That's the recipe she's offering with 10% down. And she, she was told that she was in the top three out of the 10 offers, but top three is the same as being dead last
Speaker 3:Be 10th . Yeah . 10 offers, you may as well be 11 . Yeah.
Speaker 1:So then late last week , um, she wrote an offer on a house listed for about two 50, $40,000 over asking still with 10% down and , um, came in second. So what do you think my play was my next step?
Speaker 3:10% is a gray town payment, but the magic number in the minds of listing agents and sellers everywhere is 20%. Correct. I was like, is there, do you have any account gift you call grandma where we can put on paper, Hey, I can do Yep . 20%
Speaker 1:Or anything more than what you got more than 10 years . Right . So I , I was given permission to have a conversation with dad. Okay . You know, because we're kind of recognizing the, between the real estate agent and myself. Probably the issue here is the percentage down payment.
Speaker 3:It's not, she , she has no fear to pay the market price for these homes. Correct. Well, God bless. Like I'd rather try to be problem solving the down payment element and not fear of what it costs to win.
Speaker 1:Okay. Right. That's a little bit more incurable fear . Yes. So , um, so I had a conversation , uh, I think it was late Thursday with the dad , kind of after the second, after she lost, after she came in second place and explained how, you know what, if you're willing to sign a gift letter saying that, you know, you'd be able and willing to give a gift to your daughter, you know, what amount would you be comfortable with ? $36,000 because that's the annual gift limit times two. And I didn't even bother having that debate with 'em because it's like, okay, you know what that allows us to do Right . With 20% down on the next offer. Yeah . Right. But he was very , uh, um, had a kind of a mental block. He said, I just don't understand why sellers care. You know, if you've got that pre-approval letter that says you can put 0% down or 5% down, how , what does it matter if the other , um, buyer that you're competing against can put 50% down and , and he just couldn't get,
Speaker 3:Has he ever sold a house? I ,
Speaker 1:Yes, but
Speaker 3:In the last 10, 20, 30, 40
Speaker 1:Years. I , I think so. Um, but I, I just tried to explain to him and finally just came down to me explaining, you know what, it may be irrational to you, but your daughter's real estate agent has been doing her craft for like over 30 years. I've been doing my craft for over 30 years and just trust us down. Payment size matters. Yeah. Uh , in the eyes of the seller. And because it , it , it , it projects. Why , why do you think down payment matters to the,
Speaker 3:There is an implicit, I call it get it doneness when you've got a strong down payment that sellers you're communicating like, I have the resources to get to the closing table.
Speaker 1:Right. It's just kinda Right. It's implicit. Yeah. You know what if the appraisal comes in even a little lower than the $10,000? Well, you could decide to proceed with writing .
Speaker 3:Yeah . I would just, it's like, so how many times do you think you will make your daughter lose writing another offer and another offer and another offer before you might relent? Well in your,
Speaker 1:He just , you , he just wanted to be very clear and , and he did sign the gift letter. Okay . Um, he's really not gonna give the gift. And I'm like, that's okay. I just wanna know that you can, 'cause then to us, that's like verifying, you know, money in the bank. Yes. Um, so I have a feeling that this is gonna improve her chances significantly it's
Speaker 3:Not gonna hurt her chances.
Speaker 1:That's for darn sure. Alright David. So , um, that's an example of a single person buying a home, which is extremely uncomplicated. On the other end of the spectrum, sometimes people call us up when they are either in the process of a divorce or at the beginning of the divorce process. Another related topic is when unmarried people buy a home together. Mm-Hmm. <affirmative>. Right. Let's talk about those things and do a little bit of a review on the implications of divorce on the mortgage financing process and also that idea of unmarried people buying and what they might consider doing. Does that sound good? Good by
Speaker 3:Me. Alright .
Speaker 1:We'll do that when we come back. You are listening to the AC Mortgage and Realty Show on Wisconsin's radio station. AM six 20 WTMJ
Speaker 3:Getting
Speaker 2:You into the home of your dreams. Here's more of the Accu Mortgage and Realty Show with Brian . We on WTMJ
Speaker 1:Welcome back to the Academic Mortgage and Realty Show . So David , uh, nobody who gets married or, well , maybe, maybe Rupert Murdoch sha Gaur . Yeah. And when they got married for the fourth or fifth time, thought, well, you know what, maybe this isn't gonna last. But most people when they get married, as
Speaker 3:You call those people, optimists,
Speaker 1:Optimists , <laugh> , even though still something like 50% of marriages end in divorce. Um, nobody ever contemplates that when they get married and, and go to buy a home together. Uh, whether they are married at the, when they do that or they're not married. So what do you wanna talk about first? Let's, let's talk about your real life story Yeah. Before we get theoretical.
Speaker 3:Well, and, and for listeners, your friendly mortgage lender would like to remind you that divorce is a lawsuit in that happens in court. It's a, you know, pretty straightforward, you know , uh, lawsuit that judges and everyone knows how to get it from start to finish. But the important element is that there are three chapters to this book. There's before divorce, during divorce and after divorce. Aha . The phone call that I got this week was they were in chapter one before divorce. And what I said was, okay, good. Because when you enter chapter two during divorce, you the most optimistic timeline is you are on the sidelines for about six months. Because in the state of Wisconsin there's 120 day cooling off period. And then by the time you actually get on the schedule and probably get in front of a judge, you're looking at six months. And so my client, they have not filed yet and they sounds like it's reasonably amicable and he wants to go buy his next home prior to them eventually getting to the courthouse and doing the thing . Or
Speaker 1:Even filing. Or even
Speaker 3:Filing. And he has the financial means. He actually doesn't have a mortgage on what will be his departing primary. Oh , okay. Because what I told him was, okay, totally fine. Your income needs to be able to swing new house plus whatever carrying costs on the old
Speaker 1:House, taxes and insurance basically. Exactly. And any HOA dues
Speaker 3:And his income can do that. Okay. And then he also, he has , uh, accounts where he can make a down payment without the equity in Perfect. The old house. So it's kind of like really straightforward. His still spouse does not need to be on the mortgage for the new house. Yeah . Doesn't need to be on the contract. Won't be at closing. Do
Speaker 1:You know what the atten intention is on the disposition of the old house?
Speaker 3:That it will be awarded to his spouse
Speaker 1:And his future ex-wife? Yes. Okay. Well that's, that's a ideal scenario. It is . So you either got a giddy up and get the ball rolling and execute before you file. Yes. You told me when, on the last break that you had another little subplot or question for this guy. And
Speaker 3:Just like you stated at the start of our, you know , topic here, like no one likes to think about the ugly elements. Yeah. And what I said was, okay, well it's not required that you file jointly for divorce. There's a lot of times a petitioner and a respondent. Yeah . And I said, I was like, do you foresee, could your spouse file without you knowing on a Monday? You know, and you're gonna try to buy this house on Wednesday.
Speaker 1:That'd be a great way to get revenge.
Speaker 3:It would. And if that happens, you are not buying a house. Right. Be and the reason why when your party to a lawsuit, there is this unopen it's liability.
Speaker 1:Right? Yes . It's , we don't know what your liabilities are.
Speaker 3:Undefined liability.
Speaker 1:Correct. You know , because if you end up having to pay alimony or separate maintenance or child support Yeah. That counts like a car loan. Well, let say it this way, the child support costs like a car loan. Can we still deduct? Yes. Yeah. If, if you pay or are required to pay your expo $2,000 a month of equalization or or maintenance payments , uh, we can subtract that from your income before we calculate your debt to income debt to , I was gonna try to financial blood pressure. Sure. Whereas , uh, child support, we have to count like a car payment and that often sinks the ship. Um, so
Speaker 3:His response was, he is not concerned that he might get blindsided. Okay. Which I was like, okay, well at least we talked about it because neither he nor I can prevent his Yes. Spouse from doing that, but
Speaker 1:Yeah. At least you put 'em on fair warning . So , um, and then after divorce, the document that we need to see is the marital settlement agreement. The MSA Well, because that divides up the financial, it says who's getting what and who's obligated for what. And by the way, if, if your ex-spouse is, is , um, gonna be responsible for her a thousand dollars a month car payment, awesome. We don't have to count that.
Speaker 3:Correct. Can I, there's a little bit more on this 'cause I got a different phone call from a client who was in chapter two during divorce. I just wanna talk a little about more about that. More mostly about mortgage malpractice by other lenders. Ah,
Speaker 1:Okay. And then I've got, I want to touch a little bit on unmarried couples buying. Okay. When we come back , uh, right now it's time to turn it over to the WTMJ Breaking News Center.
Speaker 2:Don't break the fact to get into a house. Back to the ACU Mortgage and Realty Show with Brian Wicker on WTMJ.
Speaker 1:Thanks for tuning in today to the AON Mortgage and Realty Show. I'm Brian Wicker, the elder. That's David the younger, taller , more handsome of the Wicker's. And they were talking about , uh, divorces and how they , uh, work with mortgages. And we covered one story before the news now , uh, you got another one.
Speaker 3:Well, I got a separate phone call. Another client who had been air quotes pre-approved. Oh. And two other lenders Really. But their real estate agent just didn't trust, you know, whomever what other lenders their client was talking to and was pretty direct and like, you need to talk to David because
Speaker 1:Fantastic. Because
Speaker 3:What ended up, what I ended up uncovering was almost like, did, did these other mortgage companies go through any type of training? Because I , I unearthed the issue about 47 seconds into the phone call. Oh , okay. Because anyone who's going through divorce is pretty forthright about they
Speaker 1:Usually say by way .
Speaker 3:Yeah . Because they know that hey , this is probably an element that's gonna, you know, influence. Yeah . Everything. Okay. And again, there are three chapters in the book before, during, and after divorce.
Speaker 1:And where are these people? They
Speaker 3:Were in , they are in chapter two. Oh . During divorce and Twitch. I was like, okay, well when have you signed a marital settlement agreement? Has it been put in front approved by the court of
Speaker 1:The judge? Yeah. 'cause we need to sign
Speaker 3:They signed off. Right. Court
Speaker 1:Approved Marit
Speaker 3:Settlement agreement. Are you on the schedule to go back to court? They were halfway through. They had negotiated like the child support agreement, but they had not wrapped up the rest of the marital settlement agreement. And they weren't even on the schedule to be back in court until the end of July. Huh . And you know hard
Speaker 1:Before the horse man.
Speaker 3:Well, a little bit. Yeah. Only because why would this guy know if two other lenders Yeah. Hadn't put
Speaker 1:Evens brakes
Speaker 3:On this. You know, why, why would you know? And so I don't enjoy telling people that they are on pause. And I was like, you can't buy a house. Right . There is not a lender. Maybe
Speaker 1:There's , maybe there is a lender somewhere.
Speaker 3:There is no lender that I could call who is in my cell phone who will give you a loan because you have this undefined, unresolved
Speaker 1:Big financial. Yeah. Yeah. You might lose half your assets in the , in negotiation or will . Yeah. Well it's always a question of which assets. Alright , so so they took the news like champs and said, okay. Yeah . And well now we know
Speaker 3:What to do. As I like to say, it's not a never it's, it's a not now. Yeah.
Speaker 1:And what's the disposition of their current? Do they own a home now
Speaker 3:To what you said earlier, I believe his spouse is going to retain the
Speaker 1:Previous marital
Speaker 3:Marital home. Yeah. Which again, if your MSA says ex-spouse is responsible for everything regarding this house, we can exclude that from any analysis on the future home. But most, which is kind of crazy by the way.
Speaker 1:Exactly. But most marital settlement agreements I've ever seen say, and the one retaining the current marital home must refinance and remove the , uh, departing spouse from the mortgage obligation, which
Speaker 3:Just to walk down the path of revenge. If your ex-spouse, if you're still on the mortgage to the old home and your ex-spouse decides to stop paying the
Speaker 1:Mortgage , you're
Speaker 3:Still , I might be able to exclude it, but it's gonna shred your credit. Correct. So you wanna get removed from that. You don't wanna let that linger 'cause their future payment will have an enormous impact on you going forward if you don't get yourself removed.
Speaker 1:Your brother-in-law and I had worked on a , um, divorce related refinance together where we tried mightily to help the , uh, husband who was retaining the home , uh, modify the loan, the existing low rate 30 or fixed rate loan that they had. Sure . That did not work. The a the mortgage lender. Well
Speaker 3:It , it's because lest we all forget mortgages that are securitized by Fannie Mae and Freddie Mac are investments and they have a rule book that they are pledging that these abide by. And you can't just go making changes that
Speaker 1:The , the fly in this ointment though was that the um, wife, the ex-wife's attorney really wanted the mortgage company to release her in writing from any , um, obligation. Even though she had never actually signed the promise to pay back the money. She had a actually valid concern, you know, that if a mortgage were filed, that mortgage foreclosure, I should say, if a foreclosure was filed, that would show up , uh, on her credit record. 'cause it is a public, you know when when a , when a mortgage lender forecloses on somebody that goes through the circuit court Yeah. And is a matter of public record . So anyway, divorces the , the other , well
Speaker 3:It requires an expert who has done this
Speaker 1:More than once. Hundreds of times.
Speaker 3:Yeah . Because again, not everybody gets divorced. Uh, and not everybody navigates how to line up their home financing with this thing that they probably weren't expecting when they got into it. You gotta call the pros.
Speaker 1:I do have one , uh, couple , uh, unmarried who is actually doing the smartest thing and they're doing a prenup that, that is
Speaker 3:Unromantic yet financially savvy.
Speaker 1:Right. Because if you buy a home and you're not married, there is no blueprint for how you're gonna unwind that joint ownership of that asset. If you're married, the blueprint is the court. They're gonna help you decide if
Speaker 3:One of you wants to keep
Speaker 1:It. Yeah. If one of you wants to keep it. Alright, when we come back, I gotta follow up story on , uh, home shopper we talked about last week. Yeah . And we'll get to that right after this. You're listening to the Academic Mortgage and Realty Show on AM six 20 WTMJ.
Speaker 2:Important home buying questions and answers you can count on. This is the Aude Mortgage and Realty Show with Brian Wicker on WTMJ.
Speaker 1:Welcome back and thanks again for tuning in today. So David, last week I was telling , uh, about a client , um, a retiree who is selling her home in the Chicago suburbs to her son and daughter-in-Law. And then she's gonna buy a new place for herself. She's downsizing. Okay . And she wants to buy like a town home . And so she had gone ahead , uh, and written an offer , um, but correctly checked the box that said, well this is contingent on the sale of my home to my son, which is imminent, supposed to close , uh, like tomorrow, like the first, you know, Monday of June. And that seller wisely said, well, can you show me any kind of a pre-approval letter
Speaker 3:Trust but verify
Speaker 1:Or or commitment letter that you know, your your son is actually gonna be able to buy the home? And the answer was no. And, and furthermore it turned out that the appraiser hadn't even been to the house for that for the son's mortgage. Obviously it's not us. They went with somebody else against my, you know, wishes. But I didn't, I wasn't the decider. Mm-Hmm . <affirmative> . So , uh, anyway , uh, she withdrew from that offer and she really wasn't in love with that house anyway. Well then , uh, uh, over the Memorial Day weekend. Yeah . Now with more certainty because the appraisal had actually happened. So they were making progress towards closing on the sun's purchase of her home . It
Speaker 3:Just kind of blows my mind a little bit. That's just like, you know, nobody's walked through our house. Yeah . You know, for you to buy this is that
Speaker 1:Happening? And we're supposed to and we're supposed to close in a week and a day. Okay . Yeah. So , uh, anyway , uh, wrote another offer on a really lovely town home , nine foot ceilings end unit. And on that particular home, David, she's putting half down, 50% down. Going back to our comment on what do sellers like to see. Yeah. And when I put that address through , uh, Fannie Mae's automated underwriting system, no appraisal required. Boom. Our favorite thing,
Speaker 3:That's the best.
Speaker 1:Because now we don't have to, you know, the seller doesn't have to worry about that. We highlight that in yellow. The no appraisal required
Speaker 3:When I'm texting agents, listing agents like we don't need an appraisal. I have to hold myself back from not putting that in all caps. Yeah. 'cause it's a big deal.
Speaker 1:Yeah. Huge deal. And uh, and then she was offering I think 10,000 over asking and um , great . And oh , it's a kicker here. And so her offer got accepted. She was thrilled. I was thrilled. Um, now, and this is one of those cases where we have to have her take an IRA withdrawal Yeah. In order to supplement her social security income to qualify for the loan. Mm-Hmm. <affirmative> . And what a lot of repi retired people do is they do take money out of their investments, but they take it out of their non-retirement account first because you don't have to pay income tax on that when you take money out of the ira. Yeah. You gotta pay
Speaker 3:Income tax. How come Sam says I'll take some place ,
Speaker 1:But the only thing that counts in Mortgage World as income is when you take it out of your IRA or your 401k Yeah. Taking money outta
Speaker 3:It's treated like income. It's
Speaker 1:Treated like income. Yeah . So we're tight with her financial advisor. In fact, that's how we first met this woman five, four or five years ago when we did a refi. And so we did the same routine then fine, we're gonna do it now. I had originally dialed up $1,600 a month is what we needed to take out of her IRA account to make this all work. I suddenly had this realization and the math that if I reduced it to $1,500 a month, her qualifying income would be at a sch nibble less than 50% of area median income in that Chicago , uh, suburb. What do you think that did for her transaction? Any idea?
Speaker 3:Well , uh, you're below 50. She got the Yeah. Fannie Mae and Freddie Mac have come out with incentives. If you meet those thresholds, 50%
Speaker 1:Or less of a MI . Yeah. You qualify for a $2,500 grant from Fannie Mae that flows through acu . So I was able to call her up and say, you know , and oddly enough she doesn't need it. She's putting half down, but get this, there's no, you don't get a 10 99, you know , miscellaneous income on that. It's just like any other lender. Credit just so happens that it's, the credit is coming from way down the mortgage food line.
Speaker 3:You know , I'm not sure that Fannie Mae and Freddie Mac predicted that people putting half down would be recipients of this, but unintended consequences. Yeah .
Speaker 1:The unintended consequences
Speaker 3:Would like free money.
Speaker 1:So now we're just hanging out. I had her take the withdrawal , um, that last week, last week during the last week of May to transfer the money from her IRA to the non IRA account. And we can point to that and say, look, income. You see that I got a bank statement, you know, that says that that actually happened. Yeah. So we are just waiting for those statements and we are on, on the flight path to closing, which is , uh, has
Speaker 3:Her son actually
Speaker 1:June 21st bought the house
Speaker 3:Yet. Um,
Speaker 1:That is supposed to happen tomorrow . Huh . So it looks like it's I
Speaker 3:Hope it does.
Speaker 1:Yeah. I I 'cause without that yeah. It's a , it's a problem. Alright , so , uh, when we come back, what do you wanna talk
Speaker 3:About? I wanna talk about, I have a client accepted offer, variable income. Uh, and understanding that hey, when you get into a new year, you can't be looking back , uh, to last year to be like track record. This is why you should lend me the money. Let me get into that On our last segment. You're listening to the Accu Mortgage and Realty Show On AM six 20 WTMJ.
Speaker 2:Find a place to call home without the headache. This is the Accu Mortgage and Realty Show with Brian Wicker on WTMJ.
Speaker 3:Welcome back to the Academic Mortgage and Realty Show. First one in the month of June. Where does the time go?
Speaker 1:Yeah.
Speaker 3:Uh, dad, I had a client get an accepted offer last week.
Speaker 1:You had a lot of clients get accepted offers last week 'cause you're just lucky. No, no. Are you're helping 'em find ways to write their offers Yes . In ways that are appealing to their sellers?
Speaker 3:Well , me alongside their agents. That's right. To get them, you know, writing offers and losing, it's like it's painful and something you don't wanna repeat
Speaker 1:<laugh> Not too many times. Although some people are gluttons for punishment. Alright , but what about this particular client? So
Speaker 3:This client, they had just sold a home. They have a ton of proceeds from the sale of that
Speaker 1:Home . So their sale was over completed. Where are they living?
Speaker 3:Still in the home. They actually had to move out like the Thursday after they got the accepted offer. But we're gonna get 'em. They did post-closing occupancy. Yeah. So they're gonna have to move twice. They moved in with some friends to which I thought those are some really nice friends. Yeah. But we're gonna get closed here before middle of June. Oh . So we won't have to stay very long.
Speaker 1:Well fast closing ,
Speaker 3:Uh , appra full appraisal waiver. Ah , to which I'm texting the agent, the listing agent. I can't tell you how many times I am. I am highlighting that even in 2024, perhaps more than ever relationships matter. Yeah. 'cause when I see that it's Liz, who's the listing agent. I'm like, I love Liz. I'm texting her. I'm like, Liz, it's my name onm . The pre-approval. These people are awesome. Best of all, no appraisal needed. And I'm about to walk into a swim class with my three-year-old. She's like Enjoy swim class. So excited. And the seller says yes because smart buyer's agent, good lender listing agent who trusts
Speaker 1:Yeah . Appreciates Right.
Speaker 3:Uh , in this. And so the element that we ran down then in this first week for our buyer, they are a commissioned salesperson. Oh. And they started first year of, of commission on the new job was 2022. They did even better in 2023. But now, like we're five months in to 20, 22, 24 .
Speaker 1:Yeah.
Speaker 3:And you need to show that you continue to have success. Yes.
Speaker 1:As
Speaker 3:A commission salesperson. Now that we're kind of deep into halfway through almost the new year that I can't just hang my hat on, Hey, you
Speaker 1:Know , 2023 income
Speaker 3:You made last year and, you know,
Speaker 1:20, 23, 6 months ago . Yeah .
Speaker 3:It's great that you did well, but you need to show that you continue to do well going forward.
Speaker 1:And is that a problem?
Speaker 3:It's about the same. Oh. But it was one of those, two of my favorite words in mortgage lending are underwriter discretion. Oh. Because if my client, 'cause we connected in like February or March.
Speaker 1:Okay.
Speaker 3:If he started to have kind of a mediocre
Speaker 1:Oh yeah . Declining. Yeah. Declining variable income could result in disaster. Well,
Speaker 3:And it's because it's like, Hey, congratulations you had a great 2023. Doesn't look like you're doing too hot so far in 2024. And that's the money you have to make to pay bills.
Speaker 1:I wonder how loan officers are doing with getting approved for mortgages these days. <laugh> in today's environment, yes . You might see some declining income there. Uh ,
Speaker 3:The good news is his so far, his year to date is both. Well, and here's the other element too. I asked him for not just his pay stub for, Hey, show me the end of May. I said, can you send me the pay stub for the end of May in 2023? Oh . Because the narrative that I also want to tell show an underwriter is look what he's doing so far this year is on the same trajectory that he did last year. Because
Speaker 1:There are some jobs where it is seasonal. You know, maybe you sell something, you know, golf clubs, real estate maybe. Okay . You know, that that happens. That's not exactly even every month. Yes. A little bit more lumpy as it were. Well,
Speaker 3:But as is our style, we don't just throw your PDFs in an underwriter. Yeah . And hope that they read our minds about how we view
Speaker 1:Yeah . Yeah . The numbers. We tell the story, we're gonna tell the story when , when a story needs to be told. We're great storytellers. David, what, what are, what are some of the other things that your buyers are doing to achieve success in this still multiple offer difficult environment in southeastern Wisconsin. Uh, I
Speaker 3:Do have a lot of clients waiving inspection.
Speaker 1:Oh.
Speaker 3:And partic they are comfortable. Money fixes everything. Yeah. And I think for so many of my clients, they are willing to take on whatever the honey do list is for the seller. They're willing to take that on because they want the house more than they want to be
Speaker 1:Protected from uh , exactly . Surprise , uh, condition. Surprise. Okay. So waiving that. Most of them writing over asking.
Speaker 3:Well, and I've got clients, you know, here on Sunday I'm running , oh, are you gonna go see a house? What's the address? I'm gonna run to see if I can get an appraisal waiver before you walk through it so they know that walking
Speaker 1:In next week, let's talk about, we have three flavors of appraisal strength or, or wizardry. There you go. That we use in the pre-approval process. But we're out of time for this week. We'll see you again next week. You are listening. You have been listening to the Academic Mortgage and Realty Show on AM six 20 WTMJ. The proceeding was a paid program. Advice and opinions expressed during the Accu Net Mortgage and Realty Show are solely that of the host or guests of academic mortgage and academic Realty advisors and not WTMJ Radio or Good Karma Brands. Milwaukee, LLC.