The following program. The ENT , mortgage and Realty Show is paid for in full by ENT mortgage, L L C 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, L L C, and not W T M J 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.
Speaker 1:Welcome to the Accu Mortgage and Realty Show. I'm Brian Wicker, licensed real estate broker with Accu Realty Advisors, and also the majority owner of Accu Mortgage, along with my son David, who's our senior loan consultant, managing owner and client experience off chief client experience Officer. If you have a question or a comment, you can call or text us on the Old National Bank talk and text line 8 5 5 6 1 6 1 6 20 Old National Bank, get old, and you can also grab a podcast of today's show or any of our past shows wherever you normally get your podcasts. Well, David, we've enjoyed two Sundays off with the noon Packer games. I did go to the Packer game against the Saints courtesy of my brother David and Carolyn . That was an exciting come from behind Victory. Yeah . That unfortunately we could not replicate on Thursday. But , um, when we , uh, since our last show, David , uh, rates have gone up, mortgage rates have clicked up another notch, and , uh, you want to give a little commentary on that as to both the, well, what does that mean and, and maybe also a little bit on the why.
Speaker 3:Well , uh, so since our last show, the Fed had their September meeting , uh, which was last Wednesday, and they came out and , uh, the most important I think, piece of data from that Fed meeting was the DOT plot. Correct . Which is because they
Speaker 1:Did not change, they did not change their fed over the Fed funds rate, which is the overnight rate that banks charge each other and is only slightly connected to mortgage rates. So they didn't do that. But what's the dot plot?
Speaker 3:Well, so the dot plot is they survey all the members of the Federal Reserve Open Market committee, and they say, Hey, where do you think you're gonna be voting for rates to be in the near future? And then they put that on A P D F, I guess. And markets really pay attention to that because then the people, you know, who are voting, they can see the mood of the Federal Reserve mm-hmm . <affirmative> and how they want to use their one tool to continue to combat inflation. And, you know, I I , what's funny is markets have been waiting for the Fed to change its mind. And, and the Fed is just like, no, we're not kidding. We are going to absolutely pulverize inflation and we're gonna use this big stick to do it higher for longer. That's the deadline . And last , last , and last Wednesday, the Fed again was like, no, really, we're not kidding. We're really gonna do this.
Speaker 1:Yep . And so that, that kind of set things in motion because in general , uh, their dot po or prediction for interest rates at the end of 2024 mm-hmm . <affirmative> was about a half percent higher than what their forecasts were when they last released their predictions, which was in June. Okay. Yeah . So over the course of that three year period, the voting members of the Federal Reserve's Open Market Committee said, you know what? We think it's gonna be higher for longer. Yes. You over there.
Speaker 3:Well, and then, you know, as we like to do, we take this, you know, esoteric, you know, tea leave reading, and we're, and then we segue into, so dad , in the month of August, what exactly did buyers and sellers actually do despite all these gyrations at the Federal Reserve?
Speaker 1:Yeah. Well , we're gonna get to that in the next segment of the show today . Exactly. We're not gonna let on that. But , uh, you know, in , in general, inflation, just to recap for everybody in one minute or less, the reason why mortgage rates are high is because of inflation. That's the same reason that the Federal Reserve has been increasing short term overnight rates to try to cool off the economy. So inflation's the real enemy, and right after the Fed , um, uh, came out with their new DOT plot, well, darn it, we got a better than expected weekly unemployment claims report. So that was like, oh my God, the economy is gonna stay strong. And that further fanned the flames of rates going higher. Mm-hmm. <affirmative> . But now, just this last Friday, we got a decent report, a really good report on inflation called the P C E, which always reminds me, what does I
Speaker 3:Say ? Personal consumption, expenditure, P c E ,
Speaker 1:The Federal Reserve's preferred measure of inflation. And when you strip out food and energy, the , uh, prices only went up 0.1% from July to August. Whew . That's the lowest. And it was 3.9 , uh, you know, year over year . But
Speaker 3:Yeah , go ahead. Uh , my metaphor is always, if inflation means we were fat, it doesn't mean that we're skinny yet. You know , uh, these good reports are good. We stepped on the scale and we're like, we are less inflation fat. Yeah . All right . But we're not all the way there yet. Okay. Which is the fed's point.
Speaker 1:Well, and one month does not a trend to make Exactly . You need at least , uh, I think two points to make a line. So , uh, what , uh, what has this done, David, in your observation on the front lines of mortgage lending to the appetite of home buyers, this continued upward swell in interest rates?
Speaker 3:I think , uh, I'm , I'm gonna say this, buyers curse what rates are, and then they say, okay, I need to buy a house. Now, that core group who has a good reason, Hey, I have , um, we're having a kid, I'm having another kid. Hey, I wanna move closer to my grandkids. All those real life reasons, we, we say, gosh darn it on these rates. And then we knuckle down and we say, so how can I help you get the house that you need? Because it's not just about who you are today and what your financial life looks like right now, but buyers are mindful of why am I buying this house and for what reasons in the years to come. So let's dive into some of those real life examples on August Home Sales. What buyers and sellers are actually doing after this first break. You're listening to the Acuate Mortgage and Realty Show on AM six 20 W T M J
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 W T M J. Welcome
Speaker 1:Back to the Anette Mortgage and Realty Show. I'm Brian Wicker, the elder, and that's , uh, David Wicker, the younger over there, our senior loan consultant and Chief Plant Experience officer. And just, you know , all around Great guy. Well , son , after all,
Speaker 3:Send that a hundred dollars bill there, dad.
Speaker 1:That's right. That's right. Your mother might be listening, you know. Okay. So , um, August home sales in the five county metropolitan Milwaukee area, courtesy of the , um, Milwaukee, greater Milwaukee Association of Realtors multiple listing service. So this is single family detached and condos combined. Uh, the median sales price, David 310,000, 310,000 in August. Uh , that is, do you think that's, how much higher do you think that is in either percentages or dollars than August of a year earlier?
Speaker 3:Oh , uh, I'll go with dollars. It's 21,000 more than last year.
Speaker 1:Okay. And that's for , for all those people that thought last August. Well, home prices are too high and they can't go any higher. The answer is $27,300 higher year over year . And that's , uh, 9.1% on a percentage basis. So you
Speaker 3:Wish your investment portfolio could get that kind of return on a , on anything.
Speaker 1:Yes, sir. Now , um, the other interesting thing though, that if we wanted to be bad headline writers , the 310,000 median sales price is actually down from July when it was 327,500. David, doesn't that mean that home values are dropping?
Speaker 3:No. And and that's why we're not bad at writing headlines is because it has to do with the pool of those specific homes in that specific month.
Speaker 1:That's right. And , and just by the way, I also have in my hip pocket, after we're done with this or whenever we wanna work it in, I've got the latest , um, federal Housing Finance Agency, a year over year home price index appreciation numbers. Yeah . Which is a much more accurate read on what's going on than median sales price. But let's just stick with what we got here in the , in the multiple listing service numbers, the number of home sales in August was down 17%. Only 1,788 transactions , uh, occurred in August with the help of a member of the National Association of Realtors. That's 366 fewer than the year before in August. If you compare , um, uh, last month, the August , uh, well, it's two months ago now. August, technically , um, if you compare August of 23 to the most recent normal year, which was August of 2019, right? Yeah . The pre pandemic area. Yeah . Uh , uh, era, the number of closed sales is down even more, 24% or 574 , uh, fewer sales. Now here's the silver lining listings. Were 2,191. Wow . In August. That's 400 more than what's sold. David, you're not an economist, but what does that mean for the supply?
Speaker 3:Well, more choice, right? And, and with more supply, you know, less , um, heartburn amongst buyers because they've just got, you know, more units, more places they can go see and choose from. So a little, I guess I would be cautious to call it relief for buyers is just less bad for buyers.
Speaker 1:Did you see the article online from the c e o of Redfin, which is that large publicly traded real estate brokerage?
Speaker 3:I'm not sure that I did, but I could try to . You wanna gimme an AB B or C what the headline was? Oh
Speaker 1:Man. I didn't prepare well enough for that, but it's , it was , um, well , well, yeah , the bot , he said, you know what? The only silver lining is with the real estate market right now. It probably can't get, oh , what do you want to know,
Speaker 3:<laugh> ? Oh, it can't get much worse. That's
Speaker 1:Right. That's what he said. It probably can't get any worse. But he also , uh, this was on an interview, I think he did on C N B C . He said, it ain't gonna get better for a long time. No. You know, this, this kind of crunch of reduced inventory , uh, combined with , uh, higher rates, it's just not gonna get better. You know, it's not like next week it's gonna get better or next month. Now, the other thing that I picked up online before we get to how much people paid over asking , um, is that 52% of home sellers were in, what generation do you think ,
Speaker 3:Uh , most recently , I think you're trying to get me to say Boomers. Yeah. You Okay. It was boomers. Boomers,
Speaker 1:Yeah. Boomers. And that's up from 40 . That was in , this was in 2022. So this data is a little older, but that's up from 41% in 2021. And so ,
Speaker 3:I mean, but this is nationally, right?
Speaker 1:Yeah. This is nationally, right? Yeah. I , we have no, we have no idea what the data is locally, but, you know, it kind of, kind of makes sense. There was also another article with the chief economist from Zillow talking about , uh, this group of people has won the lottery and she's talking about , uh, boomers who are downsizing. 'cause they've had three tremendous years of , uh, home price appreciation, right. During the pandemic and following. And , and so those folks who are have all this appreciation, it's like, Hey, you sell and then you downsize. You know ? Right . You sell the four bedroom , three bath suburban home, and now you're gonna buy a condo. Oh wait, do you have a story like that? Yes. You
Speaker 3:Do. Yes. Oh, more than one. Come on talking to you over there
Speaker 1:That these folks , uh, have really won, you know , the housing lottery. Because a lot of times they either don't need a mortgage, so they're kind of bulletproof from what mortgage rates are doing, or they need a smaller one. 'cause they're rolling over their equity from their old home. Alright. Hey, when we come back, let's tell your story. I've got a couple of stories to tell. We'll debate that while you're listening to this commercial message. You are listening to the Academic Mortgage and Realty Show on AM six 20 W T M J ,
Speaker 2:Getting you into the home of your dreams. Here's more of the ACU Net Mortgage and Realty Show with Brian Weer on W T M J .
Speaker 1:Thanks for tuning into today's show. We appreciate that very much. We are debating here while we're on break. What story are we gonna tell , uh, next? And , and we've got that selection made. David's gonna tell his story about a downsizing , uh, couple 'cause that fits into what we were just talking about. But before we do that, I did wanna slip in , uh, another , uh, data point that we've been tracking here on the show all year. And that is what percentage of people are paying over the asking price. David? Um , for July , uh, the number was 64%. Uh , this is in the five county metropolitan Milwaukee area talking about single family detached , uh, and, and condos. And so for May, June and July, all three months, 64% of home buyers paid over the asking price. You think it's higher or lower
Speaker 3:For the same? I'm the same.
Speaker 1:Same . Alright , well thank you for playing, but eh , you did not win a 59% only. You know , so that's still
Speaker 3:Whoa, whoa . Let's not ,
Speaker 1:Okay. It's a trend.
Speaker 3:Okay. All right .
Speaker 1:Alright . But , but the other thing that we've also
Speaker 3:Tracking , I had a salad for one night. That is a trend. That is not it. Hey .
Speaker 1:Okay. Alright . So instead of 64, 50 9% of people paid over asking. Uh , and then we've also been tracking what percentage of home buyers have paid $10,000 or more above the asking price. And that trend line was the high point for the year was 48% in May than it was 47% for June and July. And that did drop down to 40% , uh, in August. But I wanna point out one other thing that we've said a zillion times , uh, here on the show. Real estate's local. So remember I just lumped together all five counties in the metropolitan Milwaukee area. If we break it out , uh, Waukesha had the highest percentage of people who paid 10,000 or more over asking, which kind of makes sense. 'cause home values are probably the highest there, but it was 46%. Then Milwaukee, 41% of home buyers paid $10,000 or more over asking 38% in Ozaki County, 37% in Washington. But Racine County, only 26% of people pay 10 grand or more. Alright. So there's your kind of, maybe the market is cooling a little bit.
Speaker 3:Oh no's don't say okay .
Speaker 1:I'm just, I'm just saying it's maybe a better, hey fall weather, maybe this is a better time for home buyers to be out
Speaker 3:There in market . Well, if the green and gold keep playing the way that they do, there will be more buyers out there looking on Sundays. <laugh>
Speaker 1:For Sunday <laugh> . Alright, so over to you. You help somebody get an accepted offer this week , uh, downsizing , uh, repeat customer well over to
Speaker 3:You . Well , and , and um, right. 'cause a tale as old as time. They are approaching their sixties. They have now adult children and they are thinking about this next place that they wanna be. And they actually have a pretty wide budget range. Like I dad , they were looking anywhere from like 600,000 on the low end to like 1.8 on the high end. Mm . That's broad . So like big. Yeah. Broad search for them . I think they wanted to be on water. I think that was particularly important to them. And they have written about one or two offers lost using even our no appraisal needed language. Okay . Their agent or they would message me and be like, Hey, can you run this through and see if we get an appraisal waiver had used that once or twice, didn't work. Because kind of like what you said, they competing against their peers, which are other soon to be retirees maybe with a bunch of equity that they've got, you know, from their Sure .
Speaker 1:Yeah. This is, this is a tough , uh, yeah, this is a tough battle you're entering in because Exactly . It's like , yeah , we're all behemoths with lots of money and you know Right .
Speaker 3:You're not the only one. Right. So, so they messaged me on , um, Saturday about a particular condo that they were looking at. Wow . And on water,
Speaker 1:Condo. On water.
Speaker 3:On water, okay .
Speaker 1:Inland Lake or Lake Michigan ,
Speaker 3:Uh , inland. Okay . Gotcha . Near where you grew up. Come on. Okay.
Speaker 1:Gotcha . Alright .
Speaker 3:So it was one of those conversations where it was they were in competition and I , and I don't wanna walk past that part of this story either. So they were in competition. So they're gonna be offering over the list price. They're gonna be above the $10,000 over the list price. Alright ? They're,
Speaker 1:They're in that club by a lot, probably
Speaker 3:They by a lot. Here's kind of the, the real life way that, because I called it was Saturday. I was sitting on the back porch and I called my client our buyer repeat customer, many, many time repeat customer. And the conversation went something like this, what is the condo worth to you? And let's just, let's say it was listed for 400 and they were about to write an offer for four 50. These are not the real numbers, not the real
Speaker 1:Numbers. 'cause you said
Speaker 3:Already the range was higher, but we'll go with it . Is it worth, is it worth four 50 to you? And the answer was yes. Particularly because they've lost a couple times and man yeah . Right . Hurts. One of their concerns was, well, but if I offer this four 50 on a 400,000 house, is it gonna appraise for , you know, for what we're paying for it? The other part of this puzzle is that they were putting half down.
Speaker 1:Okay, half down. That's
Speaker 3:An enormous down payment, which not everyone can do. I want to give you the, the rest of the story and the real life, you know, approach. This isn't just a spreadsheet answer we were given that I was giving , but a real life answer as well. Let me tell you all that and a little bit more on this story. Right now, it's time to turn it over to the 24 hour newsroom.
Speaker 2:Don't break the bank to get into a house. Back to the ACU net Mortgage in Realty Show with Brian Wicker on W T M J.
Speaker 3:Welcome back to the Accu Mortgage and Realty Show. October 1st edition. Here we are. Uh , I'm David Wicker. That's Brian Wicker over there. Dad. I have a client who Hazah got an accepted offer, beat out two other people. And this was a conversa. The conversation had many layers. The first of which was, well, but David, what if it doesn't appraise? And here's what I said. 'cause they're putting an enormous down payment down. I said, the appraisal number does not matter. I said, do you want me to get the appraisal done? And I'll just not tell you what it appraisals for. That was a little facetious. Yeah, yeah. Because, because it's, it's the opinion of an appraiser using data. But for the , for this couple, you know, that kind of examining value, using your rear view mirror, Hey, what did other homes recently sell nearby Is that is was pretty removed from, and what is this condo worth to me?
Speaker 1:Well , and and you said it's kind of a rare, more rare breed. It's a nice condo on an inland lake. Yeah . And so those aren't very common. Right? No . And , and so that, that bolsters your , uh, viewpoint that, you know, what does it really matter what it appraises for? 'cause how many of these things are there out there to pick from? Right. And did you place
Speaker 3:Want it?
Speaker 1:Yeah . Yes. Do you want , is this also the one, were you telling me that this is also the one , uh, where they were competing against cash offers?
Speaker 3:Yes. Okay. So un unprompted, tell me about that part. Okay. Of course, I call their agent , uh, and this is actually after the fact, but they tell me this story without me prodding them. They say, okay, so my, my manager presented, there were three offers, one of which was our client, the other two were cash offers. And like a big number, like I know I said 400. It was, that's a placeholder in this story. Alright , two other cash offers. And the seller looks at the realtor manager and says, well, but what about this third offer with the acuate Mortgage Rock solid pre-approval? And the realtor manager goes, oh, those people over at acu , they really do their homework on their buyers.
Speaker 1:Bam.
Speaker 3:And, and that, that reputation among agents helped our client. I mean, along with the fact that they're awesome. Like, let's not discount Yeah . Income . Well , they're putting 50% percent down . Right? But
Speaker 1:Let me , let me say it this way. Hey, you're looking at three offers. I got two cash offers. That's what every seller hopes for sure is a cash offer with, I don't care what it appraises for, I don't
Speaker 3:Care. It's a bag of money,
Speaker 1:A bag. Here's a bag of money. I can close whenever you want. So ours is arguably, you know, Hey, our buyer ha was getting a mortgage, now they're putting half down. But I get why the seller asked that question. Um, I , I'm gonna, I'm gonna guess and we'll never know, or maybe we can know after the fact. I'm gonna guess that our buyer offered more than the other two.
Speaker 3:I think it was within, they were all within an earshot of each other.
Speaker 1:Okay. But even so, you know, it's like I, as a seller, it's like, okay, you know, if , if I'm looking and , and comparing offers, hey, you know, if it's 25 grand more, but the people are putting 50% down, that's close enough for me to being a cash offer. And in fact, I've been recently in , uh, coaching somebody , uh, acquaintance of mine on the sale of their home in the, in the upper ranges , uh, of, of home prices price . Yeah. And they had the same thing of, hey, here's some offers that were cash offers. Here's one with financing that was higher. In that case, they did go with the cash offer. Okay . Because it was a crummy pre-approval. They , the , the , the , the , and by crummy, I mean the lender did not articulate that they verified the down payment. You know what good is that?
Speaker 3:It's a pre-approval prayer is what that is. Well,
Speaker 1:I mean it's it's all too common. It's all too common. Yes. Um , alright , but back , back to your story. So you're coaching 'em , Hey, it doesn't really matter what the price is. It's what's, what's it , uh, what
Speaker 3:Is it worth to you? What's ,
Speaker 1:What is it worth to you? Alright .
Speaker 3:Right . And , and , and ignore what the appraiser says because, 'cause this actually segues into, I have another retired couple truly retired , uh, referred by their financial advisor kind of going through this same thing. They're looking like way up north. Okay. And the conversation, there's at least two parts of this story. One was, Hey, what am I willing to pay? And this is how I asked the question. I said, how long, let's say you find the house. How long are you gonna be in this home? Client said , and the answer pro probably till , you know, the Mark Krause of , of up north, you know, wheels me out of the house. Okay.
Speaker 1:Feet first, I'm gonna , I'm gonna own this for hopefully decades.
Speaker 3:Exactly. I was like, cool. So another like 40 years.
Speaker 1:Ha
Speaker 3:Ha ha . You know, that would make them put them into their hundreds. But I said, okay, so the price that you 2023 will have nothing to do with what the home is in 2051.
Speaker 1:Yeah. You won't even remember what she paid for it.
Speaker 3:Exactly. And,
Speaker 1:You know, but, but that's natural. Let's
Speaker 3:Know that
Speaker 1:A lot , lot is
Speaker 3:People don't want
Speaker 1:To overpay oxygen . People don't want to overpay. And there's a certain , um, comfort in knowing that a pro professional , uh, person, an appraiser says, yeah, you know what? You didn't overpay. Hey , uh, so , uh, you maybe got more to your story. I do . But that brings to mind a story , uh, from a senior loan consultant, Brad Kramer , uh, that he told me where he helped somebody get an accepted offer , uh, using our individual property , uh, specific , uh, pre-approval where , where we were able to say those magic words, no appraisal required. We'll tell you that story when we come back. You are listening to the Academic Mortgage and Realty Show on Wisconsin's radio station. AM six 20 W T M J .
Speaker 2:Important home buying questions and answers you can count on. This is the Accu Mortgage and Realty Show with Brian Wicker on W T M J.
Speaker 1:Welcome back and thanks again for tuning in to this week's. Uh , well, the first October edition of the Accu Mortgage and Realty Show. Mm-hmm . And , uh, David , before we get to the story, I wanna tell on behalf of our senior loan consultant, Brad , uh, Kramer, who helped the first time whole buyers get an accepted offer this last week. And also did some very clever loan crafting. Uh , why don't you finish up. You had a , a little bit more to tell about your retired people
Speaker 3:Just on retired people because this Yeah . So this was a couple referred by their financial advisor who I just love working with financial advisors. 'cause it's all about, particularly with retired folks, it's, Hey, I got this pile of money called retirement. I'd like to still buy a house. Yeah . And so, as we say, retired is not a curse word in mortgage lending. No . It's all about how do we turn the pile of money, probably called your I r A or rollover i r a , how do we turn that asset into income? So I absolutely melted the mind of this client. They, 'cause they said, I, so they , I said, how much is in your individual retirement account? I said, $500,000. I said, amazing. Here's what I can do . Mortgage lending. I'm gonna take that $500,000. I'm gonna divide by 36 . That will equal , I can put on your mortgage application almost $14,000 in monthly income. What waving my mortgage magic wand.
Speaker 1:That's more than I actually make David, I'm
Speaker 3:Just living on it , is more than they've ever made
Speaker 1:Retirement
Speaker 3:And allows them social security. This again , it's all about turning the asset into income. And do they actually wanna start pulling almost $14,000 out of their I r a ? No, but that's how you, that's how you create income for someone who's retired to go buy and they can buy as much house as they as much house as they dare. Now,
Speaker 1:Well, what are they really gonna do? You know, given that great , uh, freedom that you've given them ? Yes. Uh , is what's, what's and what is their sit , what is causing them? Are they downsizing or what's their story?
Speaker 3:They sold their, the home down here in Milwaukee, they have a boatload of proceeds sitting in their savings account and they're , they wanna buy a house somewhere up in , I think it's maybe like lander area. Okay . Just 'cause that's what they wanna do with the next chapter of their life. Oh. And they've been living, 'cause they sold their old home in like springtime this year. Yeah. They've been living with their son in his basement for the last couple months. They're tired of that.
Speaker 1:That, that is total role reversal as my mother used to say, <laugh>, the parents living in the Sun's basement. Sure . <laugh> . So
Speaker 3:They're ready
Speaker 1:To go . Go
Speaker 3:My mind. Yeah. They don't, they melt your mind. Yeah. Yeah. So, so, so for retired folks listening and your financial advisor, ANets got the tools to turn retirement assets into income. We've been doing this so many times. Couple
Speaker 1:Of notes on that though. Isn't this the one you told me the , where she's not quite 59 and a half yet, or has somebody
Speaker 3:Else Yes , that was, that was a good one. So she turns 59 and a half , which is the magic retirement age , uh, in the middle of October. And so I said, you, you can go write an offer. Like right now, you just cannot close until the day after you turn 59 and a half . No one has ever celebrated a half birthday perhaps the way that she will. Yeah. As that'll be the magic threshold.
Speaker 1:Fantastic. And what else are, are you gonna do , uh, the , uh, individual property specific , uh, preapproval for her once she gets something ?
Speaker 3:Well, exactly, because it's competitive up north. And so if they can't, they got a great down payment. But again, if we can run the specific property and confirm that we don't need any appraisal at all, no one is gonna walk through the house, we accept the value of the home makes them even more competitive. And you were saying Brad, on the ACU net team, I mean it works for both folks , uh, boomers in this case going onto their next home , but it even works for first time home buyers as well.
Speaker 1:Well, yep . And so the , the , we should mention the magic for getting the appraisal waiver is you do have to put 20% down. Mm-hmm . <affirmative> on a primary is , which
Speaker 3:Can be gift for a of course first time home buyer. Yeah. But there's no , there's no discrimination on source of the 20% down.
Speaker 1:That's correct. And we get gifts or we help people or, you know, reinforce the idea that, you know , what'd be a great idea is if grandma or grandpa or mom or dad helped you out with buying this house, that would be an awesome idea. Yeah . And, and so in this particular case , uh, the folks were competing in a very popular Waukesha County , uh, municipality. Municipality that a lot of people wanna live in good schools and all that kind of stuff. And
Speaker 3:Did I go to high school there or is it that municipality? You know
Speaker 1:What , I'm not gonna reveal that. Okay. But, you know, maybe. Okay . And , and so this home was listed in the low four hundreds and , uh, and our excellent , uh, practitioner of his craft, Brad , uh, Kramer said, you know what, let me be sure, you know, this is the talk track . Be sure you text me, call me when you're about to write an offer on something so I can see if we need an appraisal waiver or if we obtain an appraisal waiver, which is nothing but big data folks. What we're doing is we're we're bouncing the property address, you know, off the Fannie Mae, Freddie Mac databases and they've got all this data on all these properties. And they're coming back now and saying on more than I would a surprising numbers per surprising percentage saying, yeah, you know what? We believe the value you just put in. And uh, and then that is like the magic , uh, elixir, right? Because it puts you right up there with a cash offer. Hey, we don't care. We don't need to know, we don't have to put an put you through the appraisal process. Lemme tell you a little bit more about this when we come back. You are listening to the Aden Mortgage and Realty Show on AM six 20 W T M J.
Speaker 2:Find a place to call home without the headache. This is the ACU Net Mortgage and Realty Show with Brian Wicker on W T M J.
Speaker 1:Welcome back. I'm Brian Wicker, the elder here at Academic Mortgage, and that's David Wicker, the younger over there. And we're talking about , uh, a client that we helped that Brad Kramer, our, one of our senior loan consultants helped get an accepted offer. And part of the magic here, David, this is kind of a two part story, was making use of the fact that yep , we put things through the automated underwriting systems that we have and get this, we got an appraisal waiver at $30,000 over the seller's asking price. Oh ,
Speaker 3:Okay.
Speaker 1:And so just talk , you know , you were talking about your, your two retired people who very naturally Right. Buyers don't want to overpay. Right. Generally, you know, and , and so this gives, I think a buyer, this is twofold. One, it gives the buyer a sense of relief that, hey, somebody other than me thinks it's worth this dollar amount a
Speaker 3:Computer thinks. Okay, well I can all , I can argue the other side of that, but , uh, it's fine. Okay . The data says Sure,
Speaker 1:The data says that, that , uh, yeah, it's worth this number. And then we slap that right on the rock Solid pre-approval. Yeah . Big highlighted that no appraisal needed for, you know, 1, 2, 3, 4 on Main Street at this value. Yeah , that is, that's the good stuff. Yeah, go ahead. You gotta copy . Uh , what ,
Speaker 3:What I was gonna say was, 'cause it's what what do the sellers remember about your offer? Because sellers are humans and if they're trying to remember and compare offers, you know, when you get the no appraisal needed, that's what spouse looks across the table at other spouse and says, yeah, honey, but that offer, it's not that they had appraisal wiggle room or, or that's the question or whatever. Yeah. It's that no one's gonna walk through our house.
Speaker 1:Well, do you think that's such a big deal for people?
Speaker 3:It's one less thing. Okay . Absolutely. It's ,
Speaker 1:Well let , uh, you know, I don't think the walking through the house is the big problem. It's
Speaker 3:Just one less thing.
Speaker 1:Certainty . Well, and let's just be clear about this. Let's see if I can say this succinctly. Uh , if you have a mortgage, if you, if you write an offer and it has a financing contingency on it, you automatically have an appraisal contingency whether you check that box or not on
Speaker 3:The office . Can you , let's use numbers. If you say I'm gonna get a mortgage for 200,000, that mor that appraisal does need to come in at like two 10 in my example. At a minimum. Well ,
Speaker 1:Well there is some minimum dollar amount at which the home needs to appraise. Okay? Yeah . Whether or not you check the appraisal box. Right. Because there's a minimum down payment , uh, that has to be half. If
Speaker 3:Right. If you wanna borrow 200 and the appraisal comes in at 180 5, I cannot lend you 200.
Speaker 1:Yeah , yeah . That's a problem. Yeah . So anyway, so the , the fact of the matter is these folks got the , uh, their offer accepted in part anyway because they were $30,000 over asking and , uh, they had the cool appraisal waiver , uh, language out there . Language. Well, the other part is though, Brad being a good person, good at his craft, realized, you know what, if we leave off the coal borrower's income, I can actually save these people $3,500 in closing costs . What usually you think, hey, more income is better, right? No, no, but with first time home buyers , this is, this is where acuate really shines. We're really good at what we do. There's this kind of , uh, what do I wanna call it? A labyrinth or, or maybe it's a , what do you call a puzzle check sheet? A puzzle, okay. Yeah. The checkdown sheet of, okay, what's the best money, you know, the cheapest special, first time , third year fixed rate home , uh, mortgage money that we can get for you. Well, okay, these folks didn't qualify for that because their household income was too much. But then there's another program where we don't have to use actual household income, but we can kind of pick and choose which income we reflect on the application. Mm-hmm. <affirmative>. And this is where, what is that called ? The , uh, addition by subtraction?
Speaker 3:Yes.
Speaker 1:Or less is more. So in this case, by leaving off one of the borrower's incomes , uh, we were able to get these folks a better deal on their mortgage than having them both on. So that's the kind of , that's kinda kind of detail craftsmanship right there. Craftsmanship, that's the word I was looking for, David . That's the kind of craftsmanship that you can expect when you put ENT mortgage on your team. That's all the time we have for today's show, folks. We'll be back next week. You've been listening to the Academic Mortgage and Realty Show on AM six 20 W T M J . The proceeding was a paid program. Advice and opinions expressed during the Accu Mortgage and Realty Show are solely that of the host or guests of academic mortgage and Academic Realty advisors and not W T M J Radio or Good Karma Brands. Milwaukee, L L C.