Mortgage Rates: Why You Should Stop Falling for the Hype With Fred Glick and René Pérez Jr. Of Arrivva

Here’s a glimpse of what you’ll learn: 

• Discover how mortgage rates are determined from an expert’s POV, and why most buyers are chasing the wrong numbers
• Understand the different loan types and which one is right for you
• Hear how credit scores impact your mortgage—and the misconceptions that could be holding you back
• See why securing a VA loan or any mortgage with full underwriting gives you a competitive edge
• Get the inside track on market trends and what the future holds for interest rates and refinancing
• Discover what to look for in condos, co-ops, and HOAs to protect your investment
• Understand why getting a real, personal roof inspection can’t be replaced by technology like drones, and how it could save you thousands in unexpected repairs

In this episode with Fred Glick and René Pérez Jr.

Are you tired of the mortgage rate drama? Fred Glick and René Pérez Jr. of Arrivva are here to set the record straight. In this episode of We Fixed Real Estate, they reveal the truth behind interest rates and how brokers find the best deals for their clients. 

From busting credit score myths to diving into different loan options, they’ll show you what really matters when securing your mortgage. Plus, hear Fred’s bold predictions on where the market is headed and get insider tips on refinancing, VA loans, and even cryptocurrency in real estate. Don’t fall for the hype—tune in and find out.

Resources mentioned in this episode

• Fred Glick on LinkedIn
• René Pérez Jr. on LinkedIn
• Arrivva
• Loansifter
• Live Mortgage Rates

EPISODE TRANSCRIPT

[00:00:00] Fred Glick: Today on our podcast, we can talk a little bit about mortgages and kind of get behind the scenes of interest rates because everybody loves this. This is a software called Loansifter that you can only get if you’re licensed as a mortgage person. And what it does is we have many investors that we sell loans to; this takes in all their prices and figures out who’s got the best price or shows you each individual lender and what they offer for something.

So, to give a quick example. Let’s go through this. This is a million dollar purchase price on an 800, 000 dollar loan with a 740 credit score, 30 percent debt ratio, US citizen, and 90210. So it’s Beverly Hills. And s,o let’s click submit and see what the rates are. Isn’t this cool.

[00:00:58] Drew Thomas Hendricks: Yeah. Last week we had Glick Predicts.

Now it’s Glick Submits.

[00:01:02] Fred Glick: Let’s submit. There you go. So today on a 30-year fixed, and you see all this stuff and I’ll explain this. These are the interest rates. So you see, they go from seven down to six. I’m gonna skip this for a second. This is the price for those rates. So you see, if I’m gonna offer you seven percent, that means the lenders going to pay 102. 12, 2. 12 percent of the loan amount, which is 800, 000. I’m going to give you 16, 960 dollars towards closing costs. But if you take, and let’s ballpark it here, six and three-eighths, the lender will give you an eighth in rate. That APR, Annual Percentage Rate is 6. 389.

So it’s basically you get a thousand dollars source closing costs on a fixed rate of 6. 375 percent for a 30-day lock. So you could see all the different variations. It just happens to be that Sierra Pacific is one of our lenders, and they’re really aggressive, but it shows all our other lenders and what they have. But let’s modify this search and do a new one. And let’s say you’re looking for a 500, 000 dollar loan, but we want to do this as a conventional refinance rate and term, meaning just, just paying off the current loan, maybe rolling in the closing costs, but not taking cash out.

And let’s change it to a 15-year fixed. So it goes here. Let’s see what we get. Whoop, forgot something. Sorry. Property value.

Boom, submit. So now 5. 75 gets you a rebate of 4, 385, which should cover closing costs, and might be at 5. 625, APR 5. 661, you get 2, 670 towards closing costs. So you see how this all works. So we could scream out, “Hey, we have a low 15-year rate of 5 and a quarter, the 5. 396 APR, you see how much the APR is higher than the rate. That’s because you’re paying 0. 713 to get that low rate or 3, 565 dollars.” So that’s how we find out rates every day. Now you see it sneaks in, flag stars got the best at 6 percent and 5. 5 and 5. 375, but Sierra Pacific is the best of five and a quarter.

So this helps us as a broker to figure out what’s the best rate for you. And what’s the best rate they’re paying now? It might be that Sierra Pacific does something that the other lender doesn’t do. And so we have to use them for some reason, but this is pretty much vanilla. So, you can see the rates have come down too.

So we’re in the fives on a 15-year fix. Now, just for fun. Let’s modify it again and do it.

[00:04:15] Drew Thomas Hendricks: That was a 30-year fixed, wasn’t it?

[00:04:17] Fred Glick: That was a 15-year fixed. Let’s do an ARM, and let’s do it for five years and see if a five-year ARMs any good. No, nobody’s gotten anything good. So, you know, ARMs are not around.

They don’t, they don’t really, let’s just see sevens because we’re in, aha, here’s the seven years. Now, remember, what do we have on a, you can get a seven-year ARM at six and an eighth and get a rebate of 2580. So let’s compare that. Go back to the 30. Playing 30 fixed. So it’s 6 and an 8 and a little bit with 2500. So it’s 6.3.

So it’s a quarter percent better to get a 7 year arm. So you see, this is how we price rates. The other cool thing is this is connected to our website and you can go on our website anytime and get live rates and this is what you’ll get. It’s exactly the same thing we see. So, pretty cool stuff. I’ll also give you the principal and interest payment too, not your taxes and insurance.

So that’s it. I just wanted people to kind of know what we look at, what the rates are. This is as of today to 2425 and always make sure when you’re looking at interest rates and you’re competing 3 or 4 companies do it exactly at the same date. Same time. Because tomorrow rates will be different the way it works.

So there’s your quick primer on interest rates.

[00:06:02] Drew Thomas Hendricks: That’s very interesting. And also if you do go to Arrivva.com/rates, you can see the live rates, but can also subscribe, have those rates updates emailed to you.

[00:06:12] Fred Glick: Yeah, sent to you whenever they change, which is great. You’re keeping an eye. “Hey, I need to get to five for it to make sense.” Just wait the date hits five, make the application, calls, get rocking and rolling. Another thing we do is we don’t charge for credit reports until the closing, a lot of companies might charge you for credit reports up front to run all your stuff. Oh, and one of the other things, because everybody freaks out.

“Oh, I don’t want you to run my credit. My credit score is going to tank.” Well, here’s the story. If you’re a 750 credit score and I run your rates and you do it with five other companies on the same day, they only take five points off, three to five points. It’s something that nobody knows exactly, but you can kind of have this one to two week window of searching for interest rates and you’re not going to get hit on every, every time it’s clicked.

And plus, what does it matter if you lose five points? Are you going to go out and take, pick up 17 credit cards and 14 car loans tomorrow? No, you’re not. So you just gotta do it. Just bite the bullet and do it. It’s it’s yeah, it’s a little bit of a thing, but it’s the only thing that we got, but it’s not that bad because you know, people imagine that, “Oh my God, my credit’s gonna tank.”

No, it doesn’t work that way.

[00:07:28] Drew Thomas Hendricks: So there you go. They wouldn’t be able to take it too much. I mean, otherwise no one would ever apply for more debt or loans.

[00:07:34] Fred Glick: Exactly. You couldn’t get it.

[00:07:37] Drew Thomas Hendricks: Yeah.

[00:07:38] Fred Glick: I forget.

[00:07:40] René Pérez Jr.: I mean, usually the first thing when you first apply for it, it hurts you the most.

And then every month you increment a couple of points. So realistically, it’s not going to hurt you more than four, four months in a kind of amount that it’s gonna really affect you. And here’s the other thing, right? Like, we’re so, I think as a culture, we’re so in our mind, it’s like, “Oh, I want to have a high credit score. I want to have a high credit score.”

The whole reason why we want the high credit score is so that we can apply for this mortgages. So once you’re ready to buy a property, it doesn’t, like it shouldn’t, be something in your mind of like, “Oh, I don’t want to hurt it to hurt my credit score.” Because that’s like your main focus. It should be your only main focus.

Once you’re on the housing market, you should not be applying for anything else. Right? And if you’re thinking about doing that, unless you have 3 million dollars in the bank, you’re making a big mistake. Right?

[00:08:29] Fred Glick: Right. Get that furniture after you close.

[00:08:32] Drew Thomas Hendricks: Don’t go buy a boat and then buy a house?

[00:08:34] Fred Glick: Yeah. Pretty much.

[00:08:35] René Pérez Jr.: Going off of the pre-approval process and interest rates and all that.

I mean, so I’m dealing with getting my sister pre-approved for a VA loan. Right? And this just happened like in the last like 48 hours. And one of the things that happens is she’s working with a mortgage broker, and she says like, “Oh, 99 percent of my deals are VA loans, and I never fully underwrite my clients, and they never have to waive the contingency.”

Right. So, it’s one of those things where, like, it’s really important for you to understand as a consumer that just because someone tells you to not go through with the entire process, you should really kind of develop a sense of, like, “Oh, why should I do something? Why shouldn’t I do something?” Right? Because in this, you’re going to say something?

[00:09:31] Fred Glick: I was going to say something is that loan officers tend to think they’re going to run the transactions. Loan officers are not licensed to be real estate brokers. They do not know what’s going on in particular markets. They do not know what negotiation tactics you have to get to get under contract.

Like a fully underwritten pre-approval that’s because they don’t want to spend the money for the underwriter to fully underwrite the loan because it’s a lost leader for lenders. So they’ll lie to you, and I’ve even had a mortgage approvals given to me and worded in a way that it sort of seemed like it was fully underwritten, but it wasn’t, it was a complete lie, and they lied to the consumer. If you’re in a market that has multiple bids and everybody’s waiting the mortgage contingency, you better get a fully underwritten pre-approval. I mean, we’ll let you do it without it, but you’re going to sign a form saying you understand you could lose your deposit

[00:10:33] René Pérez Jr.: But it’s not even about, it’s not even about competitive markets, right? I mean here you’re dealing with the market where, let’s sa,y you’re dealing in a market where everybody has a mortgage contingency. Where everybody has a VA loan.

Well, guess what? If you are different than everyone else, where you’re fully underwritten, where you can waive everything when you, where you can have a clean deal, and let’s say both offers are at the same price, who are they going to accept? They’re going to accept the offer that has homework and done a lot of the backend stuff to make sure that they’re, you’re clear.

You might even get a better deal because of them. Right. So people call us and ask us, “Oh, what else are you going to use to help us get under contract?” Well, one of the best things to do is to be over prepared and get everything other than price out of the way.

[00:11:21] Fred Glick: And you have to do this anyway. That’s what I don’t understand about people.

“Oh, I don’t know. I don’t want to do.”

[00:11:27] René Pérez Jr.: Well, the problem is commission. The problem is that we’re in the commission-centric industry, right? And nobody gets paid until it closes. Right? So that’s why I mean if it were up to me, I’d abolish the commission system because that’s why mortgage brokers don’t want to do their job is because they’re not going to get paid until it’s a done deal, right?

So why should they do it or have someone else do it? And then they can run rates later, right? So

[00:11:50] Fred Glick: I’m talking about the consumer themselves saying, “Oh, I’ll do it later. It’s not a…” You know, blah, blah, blah. You’re going to have to do it anyway. So, get it out of the way.

[00:12:00] René Pérez Jr.: Sure. I mean, some buyers want to say, some buyers say, “Oh, I don’t want to do it right now.”

But a lot of the times, it’s because someone else told them, “Hey, you don’t have to do it.” But the person that said, “Hey, you don’t have to do it,” is incentivized financially to not really overprepare you. Right? So that’s kind of the whole kind of story there. Anyway, that’s what I’ve been doing for the last couple of days.

After I tell him, like, “Hey, look, can you just get it done?” It’s like the, the mortgage broker keeps fighting with me, and I’m just like, “Look, you know what? I’m asking you to do this. Will you be able to do it or not? Or do we have to go somewhere else?”

[00:12:36] Fred Glick: Is this California?

[00:12:38] René Pérez Jr.: Oh yeah. This is in San Diego.

[00:12:41] Fred Glick: We can do it. We do VA.

[00:12:46] René Pérez Jr.: I don’t really look into the, what we do mortgages stuff, so I figured…

[00:12:50] Fred Glick: Yeah, René Pérez nmls license dot dot. You might use all these.

[00:12:56] René Pérez Jr.: No, I’m licensed, but I don’t,

[00:12:58] Fred Glick: This is great. The guy who works in the company don’t even ask, yeah, for his own sister. Nice. Yeah, we can do it. We have a couple of lenders. They’ll do any pre-approvals for anything. So yeah, no big deal. Yeah. Big deal.

[00:13:16] Drew Thomas Hendricks: Question on the fully underwritten pre-approval. So I saw it was like a 30-day rate lock. When you get a fully underwritten pre-approval, how long is it good for?

[00:13:25] Fred Glick: 90 days because it’s the credit report, the pay stubs, the bank statement, that was shelf life. So that’s why it’s 90 days.

[00:13:35] Drew Thomas Hendricks: Kind of 90 days, seems pretty long. I kind of

[00:13:38] Fred Glick: Credit report. I mean, yeah, that’s what they’ve chosen. So…

[00:13:44] Drew Thomas Hendricks: That’s good. That’s good.

[00:13:45] Fred Glick: We’re just following the guidelines of the lender.

[00:13:47] René Pérez Jr.: They can still re-verify your things once you’re under contract, right? So…

[00:13:53] Fred Glick: Yeah, they might get an updated pay stub or that kind of thing.

[00:13:58] Drew Thomas Hendricks: Let’s talk about this Glick Predicts. Glick, what’s your prediction for this week?

[00:14:02] Fred Glick: Oh, no, mine was so major. It’s taking a little time. Well, you see the rates have come down already. So the recession has started, slowly.

[00:14:11] Drew Thomas Hendricks: Yeah, we were recording these two episodes pretty much a couple of days apart. So I can tell you the market has not been very good. The stock market’s been down ever since Glick predicted the recession.

[00:14:25] Fred Glick: Yep, and even the, what do you call it, the crypto’s tanking too, so, RAM’s in the low 90s, I think.

[00:14:34] Drew Thomas Hendricks: What is, oh, Bitcoin? Yeah, well, I see that Ethereum’s down 24 percent today.

Or for the month.

[00:14:41] René Pérez Jr.: Yeah, Bitcoin is at 92 thousand.

[00:14:46] Fred Glick: It’s been in that range. Yeah. The Winklevine made a lot of money. Let’s put it that way.

[00:14:51] Drew Thomas Hendricks: At 30 dollars. They bought it at 30, right?

[00:14:54] Fred Glick: No, they bought it like years ago. They bought it at nothing.

[00:14:58] Drew Thomas Hendricks: 30 dollars is I believe was when they entered.

[00:15:01] Fred Glick: I thought they got it like 5 dollars.

I thought maybe they took their Facebook lawsuit winnings and made it into gazillions.

[00:15:10] Drew Thomas Hendricks: And speaking of crypto, you can now pay your fees via crypto.

[00:15:16] Fred Glick: Yeah.

[00:15:17] Drew Thomas Hendricks: Right. If you’ve got some Bitcoin you want to use.

[00:15:20] Fred Glick: There you go. It’s not part of our buyer broker agreement ’cause it says dollars, but I gotta change it. I gotta do an addendum. “Do you want to do it in crypto?” So…

[00:15:29] René Pérez Jr.: One thing that I noticed, I was prepping a listing to go on the market next month. And it actually had, maybe it’s been like this for a while, but I noticed that there was a box to, to say like, seller is willing to accept cryptocurrencies. Which I thought was pretty, pretty cool.

[00:15:47] Fred Glick: In the listing contract?

[00:15:49] René Pérez Jr.: Not in the listing contract, but in the MLS.

[00:15:52] Fred Glick: Oh, in the MLS. Yeah. Okay. Especially in the Bay Area.

[00:15:56] Drew Thomas Hendricks: That’s interesting.

[00:15:57] Fred Glick: Will this hurt real estate or people saying, “Okay, I’m not going to buy because my crypto didn’t go up enough. So I can’t sell it.”

And you know, there may be a couple of people dropping out. It’s not going to make a big deal.

[00:16:09] Drew Thomas Hendricks: I mean, I’m pretty sure it’s hurting somebody because a lot of people were waiting from 2021. All the prognosticators were saying, come January, February, March, it’s going to be the bull run. It never was. So we’re in this delayed bull run.

So that’s all those people are waiting to cash out and maybe buy a house or, you know, try to see somewhat like the top that’s not there. So, yeah, I could see it hurt.

[00:16:34] Fred Glick: Well, I think in our case, it’s people will sell maybe, but they may have to borrow more instead of barring 1, 000, 000 or a 1, 000, 005 because, you know, they can afford it.

So, I mean, we’re lucky we’re in a market, California and Washington state, where people can afford things, no matter kind of what the economy is either. But every, you know, like Florida, forget it. There ain’t nothing you should touch in Florida, especially if it’s a condominium. It’s just. I don’t care if the condo is perfect and they have every dollar, the value is going to come down on even the good stuff because the bad stuff is so bad.

And there’s people walking away from houses. All these people bought all these Airbnb things. And it’s sad. It’s just completely collapsing for multiple reasons. So we were licensed to do mortgages down there, but I don’t think we’ve done any of this. Nope. And nobody’s doing nothing.

[00:17:33] Drew Thomas Hendricks: And the biggest thing about Florida that you’ve mentioned in past episodes is that, I forget the term, the condos have to have that impound or the reserve, reserve study.

[00:17:45] Fred Glick: And the state law that came into effect that basically is the same, they have to have enough money in reserves and all that stuff, and they don’t have it.

So we’re going through one of a potential listing with clients who we, they bought a house through us and now we’re listing their association, their condo. The association has 5 units, and that’s the minimum that you need the reserve study for. It’s self-managed. And by some guy who thinks he knows everything and you know, and the bottom line is you gotta get the reserve study.

And the question was, well, what if there’s a shortage? Does everybody have to pony it up right up front? The answer is no. You have 24 months as part of, you know, extra money to put into your monthly payment. So if you’re, everybody’s paying 150 and there’s an extra 25 for 24 months to get the reserves up to the number. So you got to do it because if not, the value of your property will plummet because no one will be able to get a mortgage.

So you’re now, this many buyers becomes this many buyers because you got one person with cash, and they’re going to lowball you because they can.

So five units or above, you’ve got to get that reserve study done. And that’s all across the country. And there’s a few companies out there doing the reserve studies. We haven’t really directly used anybody, so I can’t recommend anyone, but they’re out there. Just Google them or chat.

[00:19:15] Drew Thomas Hendricks: Is this something that the association hires to do the reserve study?

[00:19:19] Fred Glick: Yes. So, and they’re also, you know, every kind of association is cheap.

They don’t want to spend any money. Or they spend ridiculous amounts of money on things that they don’t need to spend. Remember, it’s a nonprofit. It’s not there for profit. But the problem is you got a property manager. You’ve been there forever, uses only his guys, prices are a little inflated. You got to worry about this stuff, and you got to get a different auditor.

That’s the thing. That’s the number one thing you ought to do. If you suspect any problems, get a separate outside auditor. It’s the same accountant that the property manager probably be used. So, you know, that’s the worst thing you can do.

[00:20:01] Drew Thomas Hendricks: And what about for units like a condo complex with 4 units?

[00:20:05] Fred Glick: You’re okay. You don’t need the reserve study.

[00:20:07] Drew Thomas Hendricks: But you those 4 for you, 3 and 4 unit.

[00:20:11] Fred Glick: You still have to have being good shape and all that kind of stuff. But there’s other rules for the small condos.

[00:20:19] Drew Thomas Hendricks: But you don’t have to.

[00:20:21] René Pérez Jr.: I mean, so you don’t have to, it’s one of those things where like, you don’t have to have anything, but it would still be best practice to have something right? Because

[00:20:29] Fred Glick: Of course.

[00:20:30] René Pérez Jr.: You’re going to have to paint, especially if it’s a older property, or if you’re on the lookout for an older property, you have to think about, “Okay, are the CC& Rs all set in stone? Is there any funds to paint the house, the roof? Who’s going to deal with this?”

Because if you’re buying into an old property with four units, and you know you’re going to need repairs, it’s going to be a headache to get people to pay for the, to get termite done, because everybody has to agree, right? If you do termite treatment for your unit, it’s not going to be as effective as if you do the entire development.

So, you need to be, you need to make sure that whoever the HOA is or whoever your neighbors are, they’re going to be willing to pay up for the for all the necessities of the community. And if there’s no money in it, that means that as soon as you buy in, you’re probably looking into everybody having to pay up an assessment to be able to afford the expenses.

So, yeah, that’s the risk. That’s why I say HOA. No, thank you. Might as well be, might as well stay a renter.

[00:21:35] Drew Thomas Hendricks: So what are some good questions to ask for someone that might be looking at these smaller like condos with one or two, three, three?

[00:21:42] Fred Glick: Ask for the budget, you know, see what the monthly payment covers.

Make sure there’s insurance on the property. Ask who’s running it and what their qualifications are because sometimes, you know, people, “Oh, the condo fee is only 94 dollars.” Yeah, but they’re not paying for anything. They’re not paying for professional management. They’re not even paying for insurance, which they have to have.

And, you know, it’s just there, but the cheaper it is usually the worse it is. So, we see a unit with a high condo fee, you don’t really worry about it as much as the ones with the small amount. So people just see the number but don’t know the context, our favorite word behind it. So, context of condominiums.

[00:22:32] René Pérez Jr.: I don’t know if this is specifically for small developments, but, you know, let’s say you’re in your mid 20s and you’re kind of still saving up for that down payment, and you know exactly where you want to live or, you know, your family is going to stay in that particular development or that area.

One thing to maybe do is, and it’s always best when time is on your side, is to maybe go to the board meetings of those developments. You know, see exactly what goes behind the scenes because you can ask all the questions you want. But unless you’re really informed and on the ground, you know, looking into what the HOA management is and what the community thinks about the development.

I say that you can’t really believe what’s in writing.

[00:23:17] Fred Glick: Yeah, thanks for mentioning that because you’re allowed to get when you buy the place, the minutes of the last couple of years of meetings that you want to look at. That’s when the decisions were made. But René knows now I’ve known for years that going to a condominium association meeting is worse than killing yourself.

It’s just the worst. It is people who this is their highest amount of power they will ever have in their lives. I volunteer to be president of my condo association so I’m going to do this, I’m going to do it. It’s just like horrible.

[00:23:58] Drew Thomas Hendricks: I do have a question. So the for buyers there’s, but what about people that are living in? Let’s take a Duplex, for example, it’s a 2-unit condo with a common area. I know fair housing. You can’t discriminate, but if you’re someone’s buying that house, the other person in the unit has no say as to who buys it.

[00:24:18] Fred Glick: Correct. Yeah, that would be a co-op, not a condo.

[00:24:23] Drew Thomas Hendricks: Okay, so a co-op, they could still have some say as to, you know…

[00:24:28] Fred Glick: If you’re undesirable, you know, let’s say it’s a New York co-op. I mean, they’re famous for this. And I don’t know what’s his name? Yay, yeesh. So one of these just idiots decides he wants to buy in the co-op.

Well, they have an interview with him and they do a background check and, you know, cause they don’t want issues. I mean, they got a lot more flexibility in a co-op than they do a condo, especially in New York. It’s insanity. So…

[00:25:04] Drew Thomas Hendricks: That makes sense. So if you’re, you might consider that if you’re selling one side of your Duplex.

[00:25:10] Fred Glick: And then there’s what’s called tenants in common buildings in, in California. We could do an entire show on that. So we’re, we’re just not going to go there, but that’s kind of sort of the same thing but worse, that is the worst form of pain in the ass stuff and documentation and the way you can buy it. And the way I see co-op, condo.

[00:25:34] Drew Thomas Hendricks: Okay.

[00:25:35] Fred Glick: That’s ascending.

[00:25:38] Drew Thomas Hendricks: As a buyer, you need to be aware of what you’re buying into and the differences.

[00:25:41] Fred Glick: You bet. You bet.

[00:25:43] Drew Thomas Hendricks: Interesting. I learned something today.

[00:25:46] Fred Glick: And also there’s this ratio of condo price to condo fee. You’ll see a lower price on a unit. “Oh, this is only 550 and you know, the place across the street is 650. Well, I’ll just buy this 550.” Well, you notice the condo fee’s 2, 200 in the, in the lower price one and 800 in the other one or something like that, there’s a reason. There’s always reasons for all of it. So that’s kind of the, kind of the thing to be aware of.

[00:26:17] Drew Thomas Hendricks: Fascinating.

[00:26:18] Fred Glick: There you go.

[00:26:18] Drew Thomas Hendricks: René, anything top of mind for you?

[00:26:22] René Pérez Jr.: I’m looking. So actually I do have something to my mind. So I’m looking at a roof inspection and something that I had noticed for maybe the last four or five inspections. I didn’t really think of it as a big deal just because technology is so advanced these days, but when you’re doing inspections, one of, one of the good inspections to get is a roof inspection. They offer drone inspections where they’re drone just takes image, like images of the entire roof for the most part. I mean, it’s really high definition images, and you’re able to tell in general whether a roof is in good or in bad condition.

But a drone inspection will never fully replace someone being, you know, inches away from the roof. It’s more dangerous and it’s why a lot, a lot of these companies are shifting into drone inspections. But if you’re, if you are getting a roof inspection, ask them if they will actually go on the roof because that will, that can make the difference between you being able to get a credit from the sellers to a seller saying like, “Hey, the inspection looks good. Bye bye.”

[00:27:31] Fred Glick: Well, you know, we ought to really talk to a roofer about this, but maybe they put the drone up and then if they see something that’s questionable, they can go up on the roof and have a further inspection, but that work, I don’t know.

[00:27:43] René Pérez Jr.: You know what, on the ground inspections keep honest people honest, let’s just, let’s just say that.

[00:27:49] Drew Thomas Hendricks: There’s also a tactile thing that you can only tell once you stand on the roof.

Like a drone’s not going to tell you whether the roof’s springy or the, you know, the sub underlayment is solid, not that that I, I would just think that being there physically feeling it and walking on it, it’s going to be a lot more true of

[00:28:11] Fred Glick: The drone can’t feel.

[00:28:13] René Pérez Jr.: I’m sure. So actually, I’d say that we’re not there yet where we have a drone for, for the retail consumers, where you can actually kind of do a temperature gauge and do the entire like actual, you know, kind of the feel of the actual roof, but I’m sure that the military has drones that can just by looking at it, you know, check on the temperature and see the stability of the roof and all that. So I’m sure there is, right?

[00:28:43] Drew Thomas Hendricks: Thermal footprint.

[00:28:45] René Pérez Jr.: Exactly.

[00:28:46] Fred Glick: Yeah. To see if it’s steel reinforced. So if they drop a bomb, they got to figure out which bomb to drop.

I guess it’s that’s probably the use for something like that.

[00:28:56] René Pérez Jr.: No, I’m sure.

[00:28:57] Fred Glick: Yeah, we probably just let out a Pentagon secret. So after FBI will be there in five minutes.

[00:29:06] René Pérez Jr.: And another news while we were on the call, we got a offer acceptance from a property that we made, an offer we made in Tacoma, Washington, so.

[00:29:16] Fred Glick: Yeah.

[00:29:17] René Pérez Jr.: So it’s Monday.

[00:29:19] Drew Thomas Hendricks: No, that’s good.

[00:29:19] Fred Glick: Keep on rocking. Yeah, it’s been busy now, and the rate’s starting to come down. It’s gonna get busier and like I predicted before, the refis are gonna start soon.

[00:29:30] Drew Thomas Hendricks: Mm-hmm. Especially at five. Like what were you saying was like 5, 3, 5, 5, 6, 5 that the loan?

[00:29:36] Fred Glick: Yeah. So yeah, on the 15 years, like five and three, eight, I think it was.

[00:29:40] Drew Thomas Hendricks: So, someone bought their house in the last year. It’s seven and a quarter. 775, it’s going to make sense.

[00:29:46] Fred Glick: Yeah, even on a 30 year, if you’re in the sevens and I did that pricing of a property value of a million loan amount of 500, 000. 740 score.

We came out at 6. 125 with 1280 dollar rebate and an APR of 6. 147. So, yeah, 6 and an 8. Or was that the seven year? No, that was the 30-year fix. And the seven year was better. So

[00:30:13] Drew Thomas Hendricks: Is there a magic number for rate decrease that you’re going to want to then can…

[00:30:18] Fred Glick: It was 2%, but that was based on a hundred thousand dollar loan.

So look, you got to look at, here’s the thing. So let’s say you borrowed 600, 000 dollars three years ago, and it was at seven and a half just to make up a note, I’m just making up numbers here, but now your balance is down to you know, 50, 000 dollars less. So the payment is going to be less at the lower interest rate, even at an eighth lower, because it’s at a balance.

So you got to do the mathematics and figure it out. But also, you got to think to yourself, do I want to restart a 30-year mortgage? Payments nice. But now you’re restarting a race. Maybe you look at taking the 30-year loans always can be done at a 25-year term. Same rate. So if the numbers work for 25, hey, okay.

Then I still saving money and I, you know, I’m not restarting the race, you know, maybe I gained a couple of years. They also do 20-year mortgages and obviously 15 and 10. Rocket does any year you want, you want a 22-year mortgage, they can do that. That would be at the 25-year price. So again, you got to play around with it a little bit.

How long are you going to be in the house? Do you want to, I remember in the old days, we used to pay four points, roll them into the loan, get the lowest rate, you had so much equity, it didn’t matter.

You got to think about this. You know, you might want to say to yourself, look, I just want to get a super low interest rate. I’m going to pay points. I’m going to throw them into the loan amounts, and I’m using the equity in my property that I’ve gained because it’s appreciated to help me get a lower payment. So every single person is completely different based on what their situation is. So that’s why obviously you want to talk to a mortgage person.

It’s not going to just when you call them, “What’s your 30-year rate? Oh, it’s…” No, that’s the worst guy you ever want to talk to. It’s like give me all your information, let’s figure out what’s going to work for you. So it’s that term. It’s that payment. It’s a whole bunch of little things. How long are you going to be there?

What your goals are. So talk it out as the refinance starts, you gotta, you gotta ask all the questions.

[00:32:35] René Pérez Jr.: So would you say now, Fred, instead of getting a, since rates are going lower, it would be easy to assume that it’s good to get an adjustable mortgage and just refi a couple of years.

[00:32:46] Fred Glick: Yeah. You can get a, the seven-year, which is better than the 30-year.

And you also, by the way, there’s no prepayment penalties on owner occupied mortgages in the United States. Period. Done. End of sentence. That was done through Dodd Frank, but I don’t know if Dodd Frank is going to survive the year, and that may change so you can refinance and then refinance again. You know, just trying to go through it.

If your value is under a million dollars and you have say at least 20 percent equity, you know, nine 99 value, seven 80 mortgage and your credit score is great. Your income is great. You might get it with no appraisal.

No, they have appraisal waivers, which is great. That makes things so much easier. And they’re talking about slowly rolling out a situation where instead of paying title insurance again for the lender, because the lender gets title insurance for themselves, not for you, the title insurance you got when you bought the property covered you from the day you bought it on back in time that nobody’s going to pop up and say, “Hey, this is my property, not yours.”

The lender now says, you know, two years later, “Hey, we need to know it’s still a clear title.” They get title insurance going back, but there’s this alternative to title insurance that’s working through attorneys where they just do the searches and they give them a letter saying, yeah, everything’s good.

That’s going to save people money. So it’s not out there big in the public yet, but slowly the cost of refinancing has come down. To get an appraisal waiver and one of those attorney letters, you know, it’s going to be super cheap to do it. Each lender is going to have a fee like around 1200 bucks, they call it an underwriting fee, 1000 to 1200 bucks somewhere in that area.

Then you have your tax service fees, flood cert fees, that kind of stuff. Notary fees, the notary person’s got to see you sign it. They get a fee credit report. You know, so there’s a few bucks to it, but literally I had people like every six months with refi on 15 years as it kept going, I think I did it three or four times.

[00:35:02] Drew Thomas Hendricks: Really? Yeah.

[00:35:03] Fred Glick: Yeah. So it’s crazy.

[00:35:05] Drew Thomas Hendricks: And during the last rate reduction, we,

[00:35:07] Fred Glick: Yeah, yeah, yeah. Back in

[00:35:08] Drew Thomas Hendricks: Three times.

[00:35:10] Fred Glick: Yeah. And like 21, between 20 to 22 in that area. Yeah. It was nuts, dropping and dropping.

[00:35:18] Drew Thomas Hendricks: I guess, yeah, as soon as we got the mortgage, the guy was back of it. That’s a lower, you should do it again. I’m like, we just did it two months ago.

Yeah. So it made sense. I think we got in right at the bottom. We’re like two, seven, five.

[00:35:32] Fred Glick: Mazel tov.

[00:35:34] Drew Thomas Hendricks: They also, then you’re locked in and it makes it kind of hard to do anything.

[00:35:39] Fred Glick: Yeah. And that was the problem. Hey, you know, we need a bigger house and rates are seven. It’s like, I don’t know, you know, everybody just sleep closer together or something like deal with it.

Yeah, that’s a big, big, big decision for people, but here’s the beauty. If you can afford it, you keep that property as a rental. Oh my God. You know, you’re with the rents having gone so much higher, you can pay it like 10 year. You know, you can have a 30-year mortgage and pay it like 10 year. Apply more towards principal, and every month it’s the opposite of compounding every month they calculate the outstanding principal balance at the rate for the remaining term at the payment you’re paying and that shows how much more is going to go towards principal.

So a lot of, you know, it’s a great way to accumulate equity if you’re lucky enough.

[00:36:32] Drew Thomas Hendricks: Well, Fred has given a master class on mortgage rates today. Yeah, this is pretty interesting. I learned a few things.

[00:36:41] Fred Glick: It’s what we try to do here at Arrivva.

Fix real estate, fix mortgages, and predict. Okay.

[00:36:48] Drew Thomas Hendricks: Everyone can go home. See you later.