Click here to watch the Roundtable on the Counsel Mortgage YouTube channel: https://www.youtube.com/live/JDZ5TakychU Subscribe to our channel to stay up-to-date on mortgage topics. Here is a summary of what we discussed:
1. Intro – the panelists are all associated with Counsel Mortgage. They introduced themselves and provided a little background of what they do.
2. Market update – the Freddie Mac Primary Mortgage Market Survey shows the average purchase mortgage rate at 6.09% on a 30-year fixed mortgage. This average may include points. We compared the US 10-year Treasury Note to the Freddie Mac rate showing the similarities in the charts. We reviewed where mortgage rates have been over the last 40 years and where rates may be headed.
3. Affordability – This is the word for 2026. You will hear it in the press, social media, and by politicians in this election year. Affordability involves a combination of reduced prices and interest rates. President Trump signed an Executive Order on Tuesday, January 20th, preventing institutional investors from purchasing single-family homes. The President directed Treasury Secretary Scott Bessent to come up with the definitions “large institutional investor” and “single-family home” in the next 30 days. The Administration also directed the agencies to purchase $200 billion in mortgage bonds in an attempt to bring down mortgage rates. We’ll be watching to see how these will be implemented and how it impacts the market.
4. Free refi – some lenders are promising a free refinance to borrowers down the road if they work with them today on the purchase of their home. However, you don’t know whether that lender will be in business when it comes time to refinance. The fact is, there are costs on every loan. We went over how lenders increase the rate to cover the costs. Bottom line, get the best deal now, and the best deal when it comes time to refi.
5. Condos – there are two approvals when purchasing a condo, the credit and income approval and the condo approval. The lender will require the condo association to complete a questionnaire, and provide other documents, such as the budget and insurance. We went over Form 1076, Fannie Mae’s Condo Project Questionnaire. We discussed some of the issues that could prevent a condo association from getting approved. We also discussed that if a condo does not get approved, there are other loan products available, such as non-warrantable condo loans. If you’re looking to purchase a condo, you may want to ask your real estate agent to look at closings in the MLS in that condo association in the last 6 months to see if any closed with financing, and the type of financing.
6. Difference between a mortgage broker, mortgage banker, and banker – we are mortgage brokers and work with lenders to offer wholesale rates and costs. We shop the market and find the best loan for our clients. Bankers are limited to offering what their bank can offer, which may not be the best product under the circumstances. A mortgage banker is a hybrid, but tends to offer the mortgage banker’s rates and costs over brokered rates. Our slogan is, “We Work For You, Not The Lender,” as we work to find you the best deal no matter who the lender will be.
7. Polybutylene piping – this pipe was found in homes built from the 1970s to the mid-1990s and was known for its low cost. However, it was prone to degradation and catastrophic failure due to chemical reactions with chlorine in water, leading to leaks and property damage. Many lenders will not lend on homes with this piping, and it could be hard to get insurance. If your home has this piping, contact the lender to see if they can lend. You may have to get a private money loan now, and then refinance later once the piping is replaced.
8. VA Loan – remaining entitlement – if a veteran used their benefits to purchase a home, but wants to purchase a new home without selling the prior home, can they do so? Yes. We went over how to calculate remaining entitlement.
9. Beating up the amortization table – while rates are high, we looked at alternatives to lower the amount of interest paid over the life of the loan. We talked about interest-only loans, where a simple interest calculation is made on the outstanding principal balance each month. The more principal is paid down, the less interest is paid. We also went over a first-lien line of credit checking account loan where deposits are made into the account to pay down the principal balance. This product has been called the Wealth Builder or All-In-One product. While rates are high, consider products that reduce the amount of interest to be paid over time.
If you are considering purchasing a home, or refinancing, either residential or commercial, contact us. We help people everyday, and can help you find the right loan.