Mortgage Rates And The Truth About Shopping Lenders

Welcome to the Monday Market Update 

This week we are covering:

 ✅ Interest rate update — solidly in the mid to low sixes and what that means for your buyers 

✅ The Wall Street Journal article on overpaying for your mortgage — and why it's misleading

 ✅ Why it's rarely about the interest rate and almost always about the strategy

 ✅ What first time buyers don't know that could cost them thousands 

✅ Bank vs independent mortgage consultant — the huge difference in service and speed 

✅ Why Bank of America is taking 7-9 weeks to close right now 

✅ 4th of July week market update — is it actually slowing down? 

✅ How to get your buyers closed in 30 days or less 

Whether you're a buyer, seller or real estate agent this weekly update gives you the information you need to make smart decisions in today's market. 

 🔗 Book your FREE Discovery Call with Angie: https://calendly.com/angiegerber/real-estate-business-builder

📞 Connect with Nikki Erickson at Kevnik Mortgage: 

📱 Call or Text: 952-484-1584 

📧 Email: nikki@kevnikgroup.com 

📘 Facebook | TikTok | Instagram: @mortgagesfrommntoaz

Transcript

Late-June Rate And Oil Update

SPEAKER_00 0:02

All right. It's June 29th, end of June, almost beginning of July. What do you got for us this week?

SPEAKER_01 0:08

Well, things are looking good from an interest rate standpoint. We have oil that's just under $70 a barrel, which is helping the tenure treasury, i.e., mortgage interest rates. So we are solidly in the mid-sixes down to the low sixes. So that's really, really, really good news from a mortgage interest rate standpoint. Um, from a future standpoint, despite the little, you know, upheaval over the weekend in Iran, things are still looking good. They expect the price of oil to continue to decline, especially with the straight open. And as soon as we get a more consistent supply of oil, we should be fine from that standpoint. We are still expecting interest rates to remain where they're at or go lower from now until the at least the next quarter. So there might be some opportunities for some clients to refinance if they're solidly in that 7% interest rate range. So we're looking forward to that. I did want to talk about a Wall Street Journal article that came out last week talking about whether or not you are overpaying for your mortgage. And it was the article is really based on the idea that depending on if you have good credit, good down payment, etc., that you could be paying an eighth or a quarter, even three eighths of a percent higher in your mortgage interest rate, just based on the difference between lenders alone. The article is a is okay, but it's a bit misleading because it talks about average mortgage interest rates based on that central

A WSJ Claim About Overpaying

SPEAKER_01 1:29

bank ideal interest rate, which basically means that the article cites interest rates well like into the fives, into the low sixes, and basically talks about how if you're paying more than that, you should really be shopping around. But that is definitely not the case as far as interest rates go. Um, should you shop around? Well, yeah, absolutely. If you feel like you are something a little bit off or you feel like you want a second opinion, absolutely go ahead and do that. But do not base what your mortgage interest rate should be based on what this article says it should be, because there are so many factors that go into mortgage interest rates. And just because you have good credit and down and a good down payment doesn't mean that you're getting a better interest rate than someone with low credit and low down payment. What it, you know, there's plenty of programs out there to help individuals with affordable housing that are income-based, that have totally different interest rates, that have subsidized interest rates, there's down payment assistance. All these factors really take into consideration when we're talking about mortgage interest rate and whether or not you're overpaying or not. Now, the article does also point out that paying about a quarter percent more or even half a percent more on an average mortgage in the US, around $300 and some thousand dollars, you could be paying up to $78,000 more in interest over a 30-year time span. And that might be true. The math is the math. However, again, take into consideration how long are you going to be in the home? Are you paying points to buy down that rate? And there's all these different factors. So although the article was intended for people to, you know, kind of stimulate that mortgage activity, you know, and kind of get people thinking, it's pretty misleading when it comes to what where mortgage rates actually are right now and what you can do to help with a strategy as far as making sure that you are in the best position from a strategy standpoint, regardless of interest rate.

SPEAKER_00 3:17

Yeah, imagine that the the media is misleading a little. Oh my gosh, yes, imagine that. Yeah. So it's always good to take those with a grain of salt. And again, it's good to have someone like Nikki in your corner because when stuff like that comes up, you can very quickly bring it to her or bring it to this call and diffuse the situation or get in front of it. So, like I'm sure on your social media you'll be plugging away or letting people know, hey, you might have seen this, and this is the these are the actual facts. So be the educator,

Why Average Rates Mislead Buyers

SPEAKER_00 3:50

be the voice of reason, be the one that can come from contribution and really get the right information out there. Exactly.

SPEAKER_01 3:58

And it's really more about the fit, like what mortgage fits your strategy more so than it is what's going to be my interest rate. I mean, I have, you know, clients who currently have 2% interest rates on their first mortgage and they're looking to get some equity out of the house, they're willing to take an eight or a nine percent on a second mortgage because the bulk of their money is in that 2% range. That's, you know, we have to run those numbers as well. Does it make sense if I want to access some equity, for example? Does it make sense for me to do a second mortgage or does it make sense for me to refinance my first mortgage? So all these different, like I said, factors that are coming in. And it's not always about, well, in fact, it's rarely about interest rate, to be honest.

SPEAKER_00 4:35

Honestly, there are so many buyers that I first met them, first-time home buyers, especially. It's like anything, you don't know what you don't know. If you've never been through this process, or even if you haven't, it's been three, five, ten years, things have changed. And I I've sat in so many meetings and I signed them as a buyer. They're like, Yeah, we probably won't be ready for like nine months to a year. And I'd be like, Great, well, let's get you a baseline. Yeah, with my lender and preferred lender, you can check with your bank, whomever you want to use is up to you. I just have fantastic woman in my corner that can help you. And two months later, they're in a house. Yeah, exactly. They don't know, and that's that's where we need to come in as agents and really have a strong business partner like Nikki that can give them all the options because, yeah, rates might be where they're at. However, what is their rent? What are, you know, what are their investments? All of it. I mean, there's just there's so much more to real estate than just buying, selling, and investing behind behind the curtain, you pull it back, and it's just so much to uncover and so many questions to answer, ask, and understand. And that's why I have said it a hundred times and I'll say it a hundred more. Who you partner with matters. They are an exact and very big extension of your business. It's like another arm. So if you do not have someone in your corner that you can call or text or will pick up your phone phone call and answer your questions, like Nikki, reach out

Strategy Matters More Than Rate

SPEAKER_00 6:10

to her today because it makes a world of difference when you can just hand off a buyer that's on, you know, and get them approved. And then once you get them under contract, you have a business partner who will let you know if you need to know anything or bring you back around. But knowing that they are 100% taken care of and I can move on and find more people to help and not sit here and have anxiety or worry or doubt or fear over what may or may not happen. I can't imagine running a business like that.

SPEAKER_01 6:41

No, I can't imagine either. It's always good to have good people in your corner. And like you said, having those people that you can trust allows you to bring more business in, allows you to help more people.

SPEAKER_00 6:50

Mm-hmm. Because you know you can do it and you know you have the business partners to help you along the way. So it's so, so very important. And I know with 4th of July coming up, it's typically a little bit slower. However, I'm actually seeing a lot more buzz than I have in past years. Is are you feeling that too, Nick?

SPEAKER_01 7:10

Yes, I actually am feeling a lot more excited about July because usually, like I said, I've said it last week. I think I said just reminder, it always slows down around 4th of July, but I've definitely seen enough a pickup, you know, this year for whatever reason. So maybe it's because 4th of July is, you know, on a Saturday and you know, that just it just isn't affecting the natural flow of business, but who knows? I mean, I'm for it. I I got a couple of purchase agreements over the weekend actually that are have that are for July closings. So it's definitely we keep adding and adding and adding, which is great.

SPEAKER_00 7:41

So yeah, and that's another thing about Nikki, she can do 30 days or less. Yes. Closings where a lot of my when I get a buyer with the bank, or if I'm a seller and a buyer comes to me and they're with the bank, they're like, Oh, we need the 35 to 45 days. I'm like, fine, yes, again. You know, I'm not used to that with you.

SPEAKER_01 7:59

So yes, I actually just had a client that um came to me because they got a quote from Bank of America, and Bank of America is seven to nine weeks right now on closing. What? Yeah, seven to nine weeks. They've just dumbing down, they've you know pared down their mortgage side of things, and they just don't have as many people as they used to, and so things are taking longer to get through the system. But yeah, they're they're using me simply because I can close on time and I don't have to wait seven to nine weeks.

SPEAKER_00 8:24

Well, and I know one thing that I've noticed, I mean, I want to just touch base on this with agents as well. If you're watching this, because I almost got years back, I almost got kicked off as an agent off of a deal. They were gonna stop. It was US bank and they're out of Kansas. I think it was US Bank and they're out of Kansas City, and it was my buyer, and they just wouldn't respond. Like three days, not not touching the file. I would call she's like, Oh, I was homesick with my kid. I'm like, what? And

Why The Right Partners Win Deals

SPEAKER_00 8:55

like literally, I was just like, dude, because I know I know what service to expect, I know what you can do and what you can't do. And I know these people at many of these banks, it's like a flow chart. It's like if you ask a question, if it's yes, you go this way, and if you it's no, you stop, yeah, and then they don't go anywhere with it, and it's just like I know better. And so again, that is one of the many reasons why I choose to partner with Nikki because no's a challenge for her. Exactly. Exactly. One thing you actually bring up. No, I dare you.

SPEAKER_01 9:29

You actually bring up a really good point. So when you know, when you have a loan officer that's working in a bank environment, one important thing to note is that response time. They are not allowed to answer phone calls after hours, they are not allowed to answer phone calls on weekends, they are not allowed to work during their PTO time because it's very heavily regulated from a bank standpoint. The reason for that is because they are paying their loan officers somewhat of a base salary. They are a W-two'd employee that they have to follow, you know, laws, et cetera, from a work compensation standpoint and from how much they can work, et cetera. On my end, because I am a fully commissioned person, I can work, you know, just like a realtor does, I can work on weekends, I can work after hours, I can answer those questions and be there to get provide updates on the daily, no matter what I have going on in my life. So if you have a kid that's sick at home, I can still be answering those questions and making sure that I'm keeping on top of my business and you know, while I'm taking care of my child. So it's one of those things where there is a huge difference just from a work standpoint when you compare a bank or a credit union to someone in the secondary market like myself.

SPEAKER_00 10:36

Yeah. And like last week, you had your little baby, your little kid. Yes, yes. We just make it work. But we show up and we do what we need to do to get business

Bank Delays, Rules, And Response Time

SPEAKER_00 10:45

done. And I'll tell you, it is a shock when they're not doing, and I get it, like the W-2 thing. I totally get the regulations and everything. But when you're not used to that and you're just trying to get things moving forward and you know how it's supposed to go with with Nikki, it's it's just like be frustrated. They're like, like literally, the the woman at US Bank told my buyer, she's like, if your real estate agent reach out to me one more time, I'm not working on this anymore. Yeah, I'm like, Oh, okay, one way to I better back off because I know what to expect and I know what you can do. And I'm like, no, this isn't how this works.

SPEAKER_01 11:19

Yeah, that's certainly one way to affect business.

SPEAKER_00 11:22

So I got kicked off. I got kicked off a file. So yeah, I had to go silent, but we got it done. It was just so difficult. It did not have to be that hard. So nope, it does not wonderful. Well, if you're looking for a fantastic loan officer, mortgage consultant, person to ask questions. Nikki, how do they reach you?

SPEAKER_01 11:41

You can reach me on Facebook, TikTok, and Instagram at mortgages from Mn to A Z. You can text or call me at 952-484-1584, or you can email me at Nikki at Kevnik Group.com.

SPEAKER_00 11:53

Love it. All right. Are we, yeah, next Monday? Are we on? I think so. Yeah. Yeah. Should be good. All right.

SPEAKER_01 12:01

So, you know, hey.

SPEAKER_00 12:02

Absolutely. And go sell something, people out there, because I am I'm expecting a contract on one of my townhomes. So let's keep going. And yeah, it's now's the time. So appreciate it. Yes, and make sure you have a safe 4th of July. Yes, you all as well.

SPEAKER_01 12:15

All right, goodbye.