Don't Make These 5 Mistakes When Buying a Home.

Don't do one of these five things when buying a home, or your financing will be in jeopardy. All this and more. Coming up on India's real estate gurus.

Advisors Mortgage Group is proud to present in these real estate gurus hosted by Rick Ripma, the hard working mortgage guy, please contact Rick for all of your mortgage needs at HardWorkingMortgageGuy.com That's HardWorkingMortgageGuy.com Now, here's the hard working mortgage guy Rick Ripma.

Hope you're having a great weekend. This is Rick Ripma, your hard work and mortgage guy

and I'm Ian Arnold with Advisors Mortgage Group at our

web address, if you have any, if you would like to get a hold of us or have any questions for us is HardWorkingMortgageGuy.com. That's HardWorkingMortgageGuy.com.

Or you can catch our any of our past episodes. Or if you can't listen to this whole one on any of our podcast at Indy Real Estate Gurus,

right, our podcast, there's a lot of information out there that we put out so it can it can be worth it. And the newer ones, we've been able to schedule chapters. So it's very easy to go through and just listen to the things you want to listen to. Yep.

And makes it nice and easy. And sometimes people select on Them and they go through ones that they might have missed a weekend or something like that. Right. And it's just a nice little refresher course. Yeah, if

they have you know, there's it answers a lot of questions people might have on mortgages. But you know, let's get into the numbers and I wanted to go over I had had I had a real estate agent send me some information. And we had been talking and she was telling me about the the way the market is today from a perspective of a real estate agent we had Jeremy on and he talked about the same thing but it's nice to get a variety of of views of it. And this and this agent is specifically in in Marion County, they do a lot on North Meridian street, you know the the can't remember all the neighborhoods, their broader play area, the meridian Kessler area, that area and they're they're very large agents they've been they've been doing a long time and they sell a lot of homes. And she was she was just telling me how hard it is for some people to find a home. So she sent me this information and this is from my bore metropolitan Indianapolis Board of Realtors. And this is for Marion County. We're gonna go over a few counties because she sent me a few different counties. But Marion County the median sale price in Marion County is $242,500. Now to me, that's amazing.

Yeah, I mean, but you always got to keep in mind, I mean, you're gonna have some of those houses that are on the outskirts of downtown Arish area that might only sell for 100 200. But then drive down Meridian Street. Yeah, those houses aren't even close to 100,000.

Well, you know, and it's really hard to find houses in that $100,000 range. And no matter where they are, they're not the only place I've seen them. And even in even in those areas, they're they're quite, they're starting to get above that is, you know, if you're really rule, you might find something that's, that is in that price range. Also, in Marion County, 13 109 units were sold. This is for August. So 13 109 units sold the active inventory. Well, let's go to the new the new listings was 1520. So about 200 more units were listed than sold. And the active inventory is 15 146. Which you know, it sounds like a lot but if you start thinking about the levels you have you have your you know all the different price ranges so there's what 2530 different price ranges when you break it down there's really not in each price range. There's not that many homes available.

No I mean, drive through Indianapolis just a couple little places and just try to count how many houses right there's so many houses like in one little area 1500 is nothing that's nothing. I mean, this I mean, if you want to say Broward County, way out there Yeah, that's gonna be a different area. I mean, houses are a little bit more spread out. There's a here houses are built really almost right on top of each other and you're talking about 1500 1500

and the average day on market this is an incredible number. Because we've been talking nationally and statewide in Marion County. The average days on market is 10. That is 10 day raising. That's unbelievable. That is unbelievable. Now you mentioned I was gonna go to Hamilton County but you know what, I'll go to Brown County because that happened to be one of the one of the ones that she sent me so Brown County. Now the average sale price is a lot higher. It's $419,900. But when they had in Marion County yet 13 Just over 1300 homes sold, they had 21 and homes sold in August.

Okay. But you said 21. Now how many active inventory though? 6363. So that's what I'm telling you is a big difference. And when you're talking about overall numbers, yep,

new listings was 30. They sold 21. So they added nine new listings, they have an active inventory of 63, the average days on market, Marin County was 10. Broward County was 36.

So what this could tell us, and we don't have a lot more of the counties outside is, you might have a little bit if you're willing, willing to drive a little bit further. Depends where you work, let's be honest. Yeah, it might be more helpful to move further out of the city, and maybe do a 30 minute drive to work than it is to be five minutes away from work. It might help you out finding a house, and certainly like that, so.

Yep. You know, I watch a show on I think it's Netflix. And it's, it's, it's in England and buying a home in the country. And they they show these people three different homes. And, and it is amazing. And their prices are a lot higher than ours.

Yeah, but hold on. Are you converting it?

No, most of them are already done. Oh, are they're okay. Some of them aren't. But yeah, and they're and they're all old. Almost all of not all of them are old. But it's just just a whole different market. But it is interesting to watch, and their market. During the same time, when the shows I've seen that are recent. It's like you see a house, you better make an offer if you want it, just like it is here. So there's three more counties. But all I really want to go over is the days on market. I think that's kind of important. You might if there's something else you think you want to see.

No, I mean, basically, it's all going to be close to the same type of stuff. But yeah,

Hamilton County, it's nine days on the market. $420,000 median sale price, Hendricks County has eight days on the market. And its 334,007 55 average sale price. They only have 282. Listings. Johnson County has 10 average average days on the market 299, median sale price. And active inventory is 271. There just is not a tremendous amount of homes out there. There is inventory. But it's it for Indianapolis that hasn't changed that much. If you find if you're looking for a house, and you find one you need to make make an offer.

And the only way to really make an offer is to be pre approved.

That's correct. You have to be pre approved. But before we go into the pre approval and all that I want to go into I want to talk about the actual what's going on in the rate market, where do we see rates going. And I thought I'd look back just a little bit going back to August 2, now mortgage rates come out of the mortgage backed security bond market is that market goes up, mortgage rates go down as that market goes down, mortgage rates go up, that market is lost. So is it goes down mortgage rates goes up, it's lost through just over 300 basis points. So that's like $3. Okay. And an every 100 is about a quarter point in rate change. And that's what we've seen, we've seen our rates go up anywhere from a half to three quarters. Now our outlook. So that's what's happened. It's as high as we've seen. Well, June was was the highest now this is just a tad higher than June. So we're seeing rates a little bit higher than June. But we still believe that rates are going to what we think short term rates are going to stay or maybe even go up a little bit more. And then we're gonna see a turn, we're gonna see the rates come back down. As the feds, I heard a radio person on the radio, a guy that that seems to have a lot of knowledge talking about, you know, what the feds are doing. And he's complaining about them raising at 75 basis points, which sounds like what they're gonna do, they're gonna raise the federal funds rate 75 basis points. When they do that. He was saying, Well, you know, mortgage rates are going up. Unfortunately, he doesn't know what he's talking about

yet. But that's the whole thing is when anytime they go with the Fed, you're gonna raise the rate? Well, if you just think about, oh, the rates gonna go up, so the rate on mortgage gonna go up. They don't coincide like that. There's there's some things to it that will affect each other. But just because the Feds increase one rate doesn't mean that mortgage rates going fully

changed. The only one that can increase is the federal funds rate, and it's tied to prime. So it's short term, it's an overnight rate. It affects short term rates, credit cards aren't affected. He was talking about the credit cards, interest rates going way up and a huge debt that people are putting on their credit cards right now to live because of inflation. However, we're going to see, you know, with the feds raising the federal funds rate that should help control inflation. If we can get inflation under control, we should see rates get better. Currently, it's a weird market because we're getting terrible economic news. A lot of it is terrible economic mirrors are at least good economic news for mortgage rates, it shouldn't be driving mortgage rates down and they aren't going down. They tend they're, they're gonna stay, we think they're gonna stay the same or go up. So with that, we want to talk about the process, you know, there's, there's the, you know, don't make these five mistakes when buying a home.

So basically, when you and I were discussing this is, when we looked at it, we're trying to find out what could save some people some headaches, down the road, things that we see. And we're gonna go, we're gonna do some go through some stories of how situations get handled and stuff like that. Because, I mean, we run into it where somebody might have changed his job, or we don't we're keep waiting on his information. And nobody, nobody gets us this information that we keep asking for. I mean, there's a lot of things that can affect your loan, even once you're pre approved, you do something and then you're no longer pre approved. That's what we don't want to have happen. So we can let you know early and you have advanced knowledge, this one we want to go over.

Right. And the other thing, the pre approval is, it's a pre approval, it is not an approval. Correct. Okay. And I think people forget that, because sometimes you do a pre approval, and something some when we do it, we're doing it for a total payment. principal interest taxes, homeowners insurance, homeowners association dues, PMI, any of that stuff, we're doing it for the entire payment. And so because of that, if any of that thing, those things change, taxes are higher, it changes what you can, what you can buy, along with that sometimes the information we get isn't isn't accurate. And when we get accurate information, it creates other problems. So a pre approval is just a pre approval, it's not 100% approval if it wasn't we called an approval, right? Correct. The committee and we issue what's called a commitment. So that is, that is important to remember that's a distinction. But you know what, before we get into that, we're gonna go to break so we're gonna talk about the the five, the five biggest mistakes you can make when buying a home that could just really jeopardize your financing. We'll talk about that after the break.

Advisors, mortgage brokers licensed by Indiana Department of Financial Institution equal housing opportunity. NMLS 33041 Rick Ripma NMLS 664589

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Brought to you by advisors Mortgage Group, where we believe the more you know about financing a home, the less stressful buying and refinancing will be.

Welcome back, and thank you for joining us. I'm Rick Ripma, your hard work and mortgage guy,

and I'm Ian Arnold with Advisors Mortgage Group. And if you did miss our first 15 minutes, go to our podcasts indie real estate gurus. Now, I do want to apologize to some of the listeners out there that we're waiting to hear from Simon, our insurance agent. Unfortunately, he was little under the weather this week. So we're going to reschedule that. So that's why we had to do a different one this week. But hopefully Simon gets well and we'll see him here in a week or two.

Yeah, he has he wants to wait till he's well before we reschedule. So I don't want him get me sick. Well, yeah, we'll get him on as soon as we can. So that you know hopefully that that will be soon you know with that the also if you want to listen to our podcast at any of our old podcasts or you want to listen to this show you maybe can't listen to the whole show, just Indys Real Estate Gurus on any of the podcast systems, and it should come up or you can go to HardWorkingMortgageGuy.com And there's a podcast Radio Show podcast button, click there and you can go to all of our podcasts. This one won't be up until sometime next week. But all the others are on the site. Now let's get into the these these five.

No, no, no, sir. Oh, the question or the week.

Yeah, you're you I forgot. All right.

So now it's time Time for question or the week. Now it's time for questions with the gurus.

The question of the week is

brought to you by the reducer mortgage. It's our inflation fighter, with a price of everything going up, call us today to see what we can do to help reduce your payments to help out your bank account. And that could be reusing your payment or even your interest rate or taking off PMI or something like that.

Yeah, depending on what they have interest rate may be able to be, you know, help, but we just talked about it. I heard it, I heard another show talking about it. And they were saying that the and I've read it in other places that debt is going up on credit cards. At an incredibly fast rate. It was

savings accounts were dropping, and now it's now credit cards going up. Not only that, is there was an article that some more people are getting loans to buy groceries.

Yeah. So if you're in that situation, it might be worthwhile to talk to us, we might be able to, yes, your interest rate may go up if you refinanced a couple years ago or six months ago or whatever. But it still may make sense to refinance and get get some cash out to take care of the things you need to take care of the average the average rate of a credit card I heard was like 18%. Correct. We're not anywhere near that mortgage. No, not anywhere near. That's still a better way to go.

All right, so the question last week was, I make a loud sound when I'm changing. When I change, I get bigger, but way less what am I? It's my daughter's favorite thing.

Popcorn. Ah, my wife's favorite. That's what you had for dinner. Not not as an addition to dinner. That's what she had for dinner last

night. Hey, if that's what your latest meal anyways, there you go. There was all right. So what kind of room has no doors or windows? Tune in next week for the answer? So Rick, we're talking about this. So I know we've listed out the top five things. So I think the biggest thing that we run into is people adding more debt. So I know I had this recently where people, they've already been pre approved. We're going down the line. We go ahead and double check right before closing to make sure everything checks up their credits good, makes her debt to income ratio. Guess what they did? They bought a car without telling me. Oh, that that messed up the ratios. So then they had to put down a little bit more money to cover it to get us under that percentage. So increasing your debt, while going through mortgage is never good. Now, don't get me wrong. Sometimes life happens, and you got to do something, but call us first. Exactly. Call us first. It's the same thing with credit cards. I know. Yeah. I think you had an instance where it's what was somebody maxing out credit cards or something after getting pre approved?

Oh, I've had Yeah, I mean, it's, it's amazing what people will do. And it's not intentional. But let's say you know, what's happened here is they buy a house, right? And now they want to they want to do some things to the house or they wanted to buy furniture. And they could get a deal if they if they charged it or if they opened a credit card. Neither one of those things should you do expecially without talking to your lender, correct. You have to talk to your lender. That is the most important thing. Now it's best not to do it till after you close. That's always best. At the very minimum, it's going to create a lot more additional effort that you're going to have to get us documentation for because we're going to need to know what it is. That's best.

Yeah. Yeah, and one other note to hit on this is CO signing does count as adding debt to you. So if you cosign for a car, guess what? That means you are on hook for it. So if you cosign for 20 grand, guess what? You owe? 20 grand? That's right. So keep that in mind. I know some people are like why cosign that still means the same back saying as you borrowed the money. Yes.

And you know, one of the things about going to look at cars, is you could tell them, You tell the salesperson at the car store or the it? What is the finance manager? Yeah, okay. You tell them, hey, I'm buying a house. Is this going to affect anything? They will always tell you? No. Correct always because they don't care.

Yep. So what they'll tell you is, oh, after will run your credit, but after so many days, it'll go to show as one that's up to 60 to 90 days. I'm sorry. We just said houses are selling in 10 days, you're trying to close in 30 days. That is not in that. That is not past that 60 to 90 day and

if you bought a car, you're just out of the payment. Yep. And I've had I had a customer do that they bought a car. And I've actually had to recently that did that and they were are very large payments, it creates all kinds of issues, one of them we were able to work through the other one couldn't buy the house.

Correct. So, and that gets us in number one was about debt don't don't increase number two, don't, don't do anything to affect your credit. So make sure your bills are still being paid on time. And like we said, Don't go shopping for a car, because not only are you debt, but like, we're just saying, they're gonna hit your credit. And they might hit it for seven, eight times. You don't want that many hits on your credit.

Well, yeah, what does it create, it creates every single one of those, you have to write a letter of explanation. And tell us whether you got why you did it. And what your credit what, whether you got any credit, if you did, then we're going to have to get the contract that you have. So we understand we know what all the the definition is what what the payment is. And that can change whether you can can change number one, whether you can buy a house or not, whether you can finance or not, or may not even it may not affect that, but it may affect what your interest rates going to be. As your debt to income just went up. So it is something you do not want to run have your credit run. Again, it's best to wait. But if you can't wait, you feel like you can't wait at least talk to your lender, call us and let us know. So we can look at it and tell you yea or nay. We want to tell you you can but we don't want to mess up everything. Okay, so your best waiting? Yep.

And then the third one, I would say we see a lot. It doesn't happen tons. But people making large cash deposits, whether it's a train whether mom and dad was like, hey, look, I'm trying to help you out. Here you go. Or you're like, hey, I don't really care for the banks too much. This is under my mattress, do not put large sums of money in account that could we need to track that. So we're gonna look at your bank accounts, and people don't realize that we'll look at it before when we're pre approving you. And then we'll also look at it before we close. So we need to make sure that there's no weird money showing up. Yeah, we're

gonna look at it also, when we actually start the apple, you know, process. That's what I'm saying for free. And then, well, we're going to do it the pre approval, but then the underwriter is going to look at it to Yep. And then at the end, we're going to start we're going to just verify that everything's still there. The problem is, as you hit on, and I've had customers that they just didn't understand it. They're like, well, we put all this money in there, we have plenty of money. Let's take it at the start before they do the pre approval. Well, how much do you have for downpayment? Well, we have $30,000, where did that $30,000 come from? Well, my parents gave it to us. Okay, that's fine. But now we have to get document, we do have to get documentation around it. If it hasn't been in that bank account for two months. We can't see it go in. And we need two months of bank statements. So if as long as it's before that, it's your money. It's called seasoned. But anything if it's if it just went in, or the worst one is, well, yeah, you know, I don't really trust banks. Like you said, I don't really trust bank. So I put it I put out, I got this from my house, I had it under my mattress, or I had it locked up in my safe. That is a problem for a mortgage lender. Yep.

And I mean, just to see it appear, I mean, it's all comes back to the fraudulent things. It's not saying you're doing anything, but there are some people out there that do and we just got to keep that the federal government says, Hey, was what we got to do. So guess what we have to do? Is what we got

to do we have to verify everything is correct. Just the way it is? Yep.

So the other one I think is a big one is changing jobs. Now, I'm gonna say this is job change is not always a bad thing. So but it can hinder us as a hindrance at certain times, because we're going to do unemployment check. So one thing I know that you had recently, and we were talking about it is they they were working on a job. And then we went to do two days before closing, they wanted to verify that they still work there, everything like that. Like I guess no, they don't work here. Well, well, this loan just stopped immediately.

It creates a huge problem. And the thing is, is we have to verify that you're at your job within 10 days of closing. So it's always a last minute thing are certain things that we have to verify. At the very end, even if we verified it upfront, which we would have in appointment, we have to verify it again. Right, right at at closing. I actually had one a few years ago that we verified employment. We closed on the loan, it was a refinance, there's a three day right of rescission on a refinance. And then that three day right of rescission, they called us the company that we verified employment with, they called us and said, Hey, he's no longer working here. No, you, you're done. You don't that loan doesn't fund that didn't mean it just like it didn't close. Now, it's not something we can't come back from and it's also it's not something that you can't do but you have to talk to us and make sure it's okay. Most people when they call me they go with It's a better paying job, it's this or that? Well, it depends. If it's a commission job, it's a big problem. Yes, if you're if it's a better paying job, because you're gonna get a bonus, it doesn't matter, we can't count the bonus you have to have for two years. And

that's what some people lose out is. Overtime, when you transfer a job, we can't count overtime, we can't count bonuses. So that's a lot of income that might deter you or keep you from getting that is the same house. Now. Promotions are different because you're staying with the same company like that. So do keep that in mind. So just, again, keep us in the loop.

The main main thing is tell us before you do anything correct.

And I thought after I just closed on one, and the customer actually called and you're like, hey, my wife. She's thinking about going for this promotion, hey, great. Launch, she's not going to be commissioned, she's not going to be no, no, she's hourly, just gonna be making more good. Tell her to take it and congratulations. So another one that we don't see a lot is don't be moving.

Right? This is usually usually somebody who is a first time homebuyer, it could be something as a house for sale. Sometimes there's no, there's no way around, right. But a short term move is not a big deal. You move, you sell your house, and then two weeks later, you close on your new house, and you have to live somewhere for two weeks. That's not a big deal. Yep. But, but moving, you know, moving a lot, just like moving jobs a lot creates a lot of additional verifications and can cause problems with your loan. So the longer you can stay, we have to have two years of of where you've lived. And if you change all the time, that can be a problem. If you change, you know, two months before you buy, that can be a problem.

The whole moving thing is try not to move if you have to, again, we understand it's life. So just keep that in mind is don't be jumping from place to place. Now, the one that we didn't really put on the list, but I think one is a big one that people really don't think about is make sure you gave us everything, all the information and the accurate best to your knowledge. I mean, I'm not going to tell you that if I asked you what your bank account and you told me at the start, and you're like, well, it's 10,432. I'm not expecting that if you say you have 10,000. Okay, that's a decent number until you give me your bank statements. But then when we ask for documents, we need them soon. Because the longer it gets held up, the longer your loan process takes. You hear about those people that say, Hey, I can close your loan in 15 days. Well, guess what? We can easily do that. But guess what? We just need everything. As soon as I tell you I need it.

Yeah, well, I'm gonna take that back. We're not It's not easy, but we can do it. Oh, okay. But it's really important that you give us accurate information, you tell us everything. People try to not tell us about things. And we always find out and we always find out late in the game. And that's when it creates a huge problem for us. So you don't want to do that. But we are out of time. I wanted to thank you all for for joining us. I appreciate it very much. Next week, we're gonna go you know, with three months, we're just gonna look at the last three months of this year and kind of give you an overview of what we think is gonna happen. I'm Rick, Ripma your hard work and mortgage guy and I'm Ian Arnold with advisors Mortgage Group go to HardWorkingMortgageGuy.com That's HardWorkingMortgageGuy.com Have a great weekend.

Brent NMLS number 33041. Recruitment NMLS number 664589. Ian Arnold's NMLS number is 1995469 equal housing opportunity, some restrictions apply?

Well, first off, thank you for joining us, Danielle. I appreciate it. And I just was curious, how did you come to find out about Rick Ripma and advisors mortgage? Well, I was looking for a mortgage for myself for a brand new home that I was building. And I wasn't sure the direction to go, I didn't have anybody in mind. So I kind of just spoke to whoever I could speak to. I got their number and everything seemed to be exactly what I was looking for. So I went with them. The thing I liked the most about Rick and his advisors mortgage is that I could go and upload things online. And I didn't have to always be on the phone with them or sending them documents or trying to look for certain things that I needed to get the process going. Which was really great for me. I had a processor named Mark Coleman, who really helped me out in making sure I had everything I needed because I I didn't know the first thing about having a mortgage. So it was awesome to have so much help. I think probably what I've benefited from the most is really just the understanding that sometimes I would get busy and maybe I forgot to upload a document or I forgot to do a certain part of the process in a timely manner and they would get right back with me and it wasn't like a hey, we really need this right now. It was always Hey, just wanted to make sure you still remember that we need this. Well you don't get that too much. In this day and age. It seems like most people are either you know Very demanding of something they need from you and they need it right now. And, and I agree. I've seen that in Rick's attitude with us over over the last 10 years that he's very patient but also helpful to get the right things he needs. So, exactly. In conclusion is Rick Ripma and advisors mortgage, somebody that you would use in the future and or tell your friends and family about? Absolutely. And I just want to thank them for all the effort they put in to help me find my dream home.

Ranch NMLS number 33041 Rick Ripma is NMLS number 664589 equal housing opportunity, some restrictions apply.

I'm Rick Ripma. You can go to hard work your mortgage guys.com