Podcast

Refinance or Hold Off? How to Play it Smart With Mortgages With Insights from AI and Fred Glick of Arrivva

Fred Glick, a Broker, Real Estate Realist, and Founder of Arrivva, holds a stellar track record with over $2 billion in residential transactions while grounded in a lifelong passion for real estate. Listen closely as Fred Glick gives you real estate hacks and tips through Arrivva’s AI Podcasters in the weekly We Fixed Real Estate podcast.

Arrivva is a comprehensive real estate and mortgage brokerage, catering to qualified motivated buyers, sellers, and mortgagees committed to brokering with love, integrity, knowledge, a well-defined plan, and a transparent flat fee structure. As featured in the Wall Street Journal, Arrivva leads the way in transforming the future of real estate, one happy client at a time.

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

  • Dive deep into the complexities of refinancing and mortgage rates and discover what is the best move to refinance for many homeowners
  • Delve into the world of the 7/1 Adjustable Rate Mortgage (ARM) and why it might be wise to hold off on refinancing
  • Get the scoop on how short-term ARMs compare to 30-year fixed loans and the crucial role your long-term plans play
  • Learn about the power of making extra principal payments on your mortgage
  • Learn essential information regarding the tax implications of refinancing

In this episode with Fred Glick

Fred Glick of Arrivva reveals game-changing mortgage advice to answer one of the biggest questions homeowners face: Should you refinance or wait?

If you’re wondering how rising rates, ARMs, and refinancing fit into your financial future, this We Fixed Real Estate episode is packed with game-changing advice. Discover why holding off on refinancing might actually be your smartest move and learn how making extra principal payments can build wealth faster than you think. Plus, this episode reveals the hidden tax implications most people miss. With the help of AI guest podcasters to guide the discussion—don’t miss this insider look at maximizing your mortgage strategy.

Resources mentioned in this episode

EPISODE TRANSCRIPT

[00:00:00] Drew Thomas Hendricks: Welcome to another special episode of We Fixed Real Estate. We’re going to continue the work that we started last week, diving deep into NotebookLM and using their AI dialogue to help explain some complex topics. Fred, what’s on the debate list for this week?

[00:00:17] Fred Glick: Well, this is interesting. I had a conversation with a perspective person who wanted to refinance their mortgage, and I basically tell them don’t do it. And there are many reasons why, and you’ll hear in the episode coming up, but really, you got to think about how long you’re going to be in the property. What kind of loan do you have now and how long is that good for and what you’re going to get out of refinancing? So there’s a whole bunch of things, it’s going to make you think a little bit, especially if you have an adjustable and you’re thinking of converting it to a fixed rate, it might not be the time to do that. And our two podcasters will tell you why.

[00:00:59] Drew Thomas Hendricks: Definitely learned something watching it. Before we tune in on that, and before we turn it on, I do want to ask, so as far as mortgage rates in general, they have been going up the past couple weeks.

[00:01:12] Fred Glick: There’s TikToks and Instagram, all these people, all these experts, “The Federal Reserve has lowered the interest rates by half a point.” Guess what, guys? The day the Fed did that, mortgage rates went up. And guess what? The three days later or so, the job numbers came out and they were very good. And guess what? Mortgage rates went back up. I think we did another one of these things where we talked about how this all works with the Fed and mortgage rates, so you can listen to that one to explain why.

But anybody who said, who pushed you, “Hey, the Fed’s lower interest rates to buy a house now,” do not use them. They have no idea what they’re talking about. Clueless. So, but enjoy this one. This is really good. If you’re thinking about refinancing, especially if you’re currently on ARM.

[00:02:00] AI Podcaster 1: All right, so today, we’re diving into something I’m sure a lot of folks are thinking about these days, refinancing your mortgage. We’re going through your chat with Fred. He’s a mortgage pro. And honestly, there’s some real surprises in this one. You’ve got a 7/1 ARM on your hands right now.

[00:02:17] AI Podcaster 2: Oh boy, an ARM. Those can be tricky.

[00:02:19] AI Podcaster 1: Yeah. So for listeners who maybe haven’t dealt with one of those, that means your interest rate chills out for seven years. Then after that…

[00:02:25] AI Podcaster 2: Who knows?

[00:02:26] AI Podcaster 1: Exactly.

[00:02:27] AI Podcaster 2: That’s when things can get a little interesting.

[00:02:28] AI Podcaster 1: It’s like the calm before the potential storm. Right now you’re sitting pretty at 6. 125%. Markets hovering around 6. 375% for a fixed 30-year. So if you’re thinking, “Hmm, maybe it’s time to lock in some peace of mind,” I wouldn’t blame you. But here’s where Fred throws a curveball. He actually advises you to hold off on refinancing.

[00:02:50] AI Podcaster 2: Really? No, that’s not what you expect to hear.

[00:02:52] AI Podcaster 1: Right. You’d think he’d be eager to jump on a new deal.

[00:02:55] AI Podcaster 2: That’s what I thought too. But honestly, that’s kind of how you know he’s a straight shooter.

[00:03:00] AI Podcaster 1: Yeah, it shows he’s got your best interests at heart.

[00:03:03] AI Podcaster 2: Exactly. Not just trying to make a quick buck.

[00:03:06] AI Podcaster 1: So let’s unpack what he’s thinking here. Fred starts by comparing your 7/1 ARM to a 30-year fixed loan, just over the next seven years.

Which makes sense in a way, because it’s not like you’re going to refinance before that fixed rate period ends anyway. It’s all about how long you plan to actually live in your house.

[00:03:24] AI Podcaster 2: Exactly. That’s key.

[00:03:25] AI Podcaster 1: If it’s potentially your forever home. Right. Those short-term rate fluctuations might not be such a big deal.

[00:03:30] AI Podcaster 2: Exactly.

[00:03:31] AI Podcaster 1: Now, get this. Fred then goes on to talk about making extra principal payments on your current mortgage.

[00:03:37] AI Podcaster 2: Now, this is where it gets interesting.

[00:03:39] AI Podcaster 1: I know some people hear that and they’re like, “Uh, okay.” But trust me on this one. This is where understanding your mortgage can really pay off. See, every month, part of your payment goes towards interest, and the rest chips away at the principal, which is the actual loan amount, by paying extra on that principal.

[00:03:59] AI Podcaster 2: It’s like you’re taking a sledgehammer to your debt.

[00:04:01] AI Podcaster 1: Yeah.

[00:04:02] AI Podcaster 2: Instead of just chipping away at it with a chisel.

[00:04:04] AI Podcaster 1: That’s a great analogy, and this is where things get really interesting, especially with the whole California housing market.

[00:04:09] AI Podcaster 2: Right, because it’s not just about paying off your loan faster. Yeah. It’s about building equity.

[00:04:13] AI Podcaster 1: Exactly. And in a market like California, well, let’s just say those extra payments can really make a difference.

[00:04:19] AI Podcaster 2: It’s like adding rocket fuel to your equity-building efforts.

[00:04:22] AI Podcaster 1: I like the way you think with these analogies.

[00:04:24] AI Podcaster 2: Well, you know what they say. Real estate is all about location, location, location.

[00:04:29] AI Podcaster 1: And speaking of location, remember that comment Fred made about California home values? He said the only thing that could hurt them is AI.

[00:04:36] AI Podcaster 2: Oh yeah, that was a good one. I think he was half-joking.

[00:04:40] AI Podcaster 1: Probably. But still, it makes you think.

[00:04:43] AI Podcaster 2: It definitely highlights how important it is to keep an eye on the bigger picture.

You know, those broad market trends.

[00:04:50] AI Podcaster 1: Absolutely. Because making extra payments, like Fred’s talking about, it’s not just about getting rid of your mortgage quicker, it’s also about understanding how money works over time.

[00:04:59] AI Podcaster 2: Exactly. It’s about opportunity cost.

[00:05:01] AI Podcaster 1: There you go.

[00:05:02] AI Podcaster 2: Could those extra dollars you’re pouring into your house, could they be working harder for you somewhere else?

[00:05:07] AI Podcaster 1: That’s the question. And that’s where things get really personal because it all comes down to your own financial goals.

[00:05:13] AI Podcaster 2: Right. Your risk tolerance, all of that.

[00:05:15] AI Podcaster 1: And speaking of exploring different options, I got a kick out of Fred’s a little tangent about AI.

[00:05:20] AI Podcaster 2: Oh yeah. Using it in his own business.

[00:05:22] AI Podcaster 1: I know, right?

It’s like this whole other layer of the financial world.

[00:05:26] AI Podcaster 2: It’s amazing how fast things are changing.

[00:05:28] AI Podcaster 1: I know. It makes you wonder if someday we’ll all be relying on AI to crunch these numbers for us.

[00:05:33] AI Podcaster 2: Right. Like a robo advisor for your mortgage?

[00:05:35] AI Podcaster 1: Exactly. But for now, let’s bring it back to basics. What were some of the big takeaways for you from this chat with Fred?

[00:05:44] AI Podcaster 2: Well, I think the biggest one for me, don’t rush into refinancing just because rates move a little.

[00:05:48] AI Podcaster 1: Yeah. It’s easy to get caught up in the frenzy.

[00:05:51] AI Podcaster 2: Exactly. You gotta think long game.

[00:05:53] AI Podcaster 1: Absolutely.

[00:05:53] AI Podcaster 2: What are your goals? How long are you planning on staying in your home? All that factors in.

[00:05:58] AI Podcaster 1: It’s about finding that sweet spot between your mortgage and your life plans. And the other big takeaway for me, those extra principal payments, they might seem small.

[00:06:08] AI Podcaster 2: But they add up.

[00:06:09] AI Podcaster 1: They really do. Over the life of your loan, you could be saving yourself thousands of dollars in interest.

[00:06:16] AI Podcaster 2: Potentially even tens of thousands.

[00:06:18] AI Podcaster 1: It’s like Fred always says, sometimes the best financial moves are the ones you don’t make.

[00:06:22] AI Podcaster 2: There’s a lot of wisdom in that.

[00:06:23] AI Podcaster 1: It’s about being strategic.

[00:06:25] AI Podcaster 2: Absolutely.

[00:06:25] AI Podcaster 1: Not just reacting to every little market fluctuation. It’s about having a plan.

[00:06:30] AI Podcaster 2: And sticking to it.

[00:06:31] AI Podcaster 1: Exactly. Not just letting your emotions make decisions for you.

[00:06:34] AI Podcaster 2: It’s like, uh, you know, when you go to the grocery store hungry, you end up with a cart full of junk.

Same idea with your finances.

[00:06:42] AI Podcaster 1: Totally. If you’re not careful, you end up making impulsive choices. That you later regret.

[00:06:47] AI Podcaster 2: Exactly. And speaking of things to be careful about, there’s one piece of the refinancing puzzle that Fred didn’t really touch on. What’s that?

[00:06:55] AI Podcaster 1: The tax man. Or woman, of course.

[00:06:59] AI Podcaster 2: Ah, you’re talking about those mortgage interest deductions.

[00:07:02] AI Podcaster 1: Exactly. They can make a big difference come tax time.

[00:07:05] AI Podcaster 2: Right.

[00:07:05] AI Podcaster 1: And refinancing can really shake things up there.

[00:07:08] AI Podcaster 2: Because it changes how much interest you’re paying.

[00:07:10] AI Podcaster 1: And how much you can deduct.

[00:07:11] AI Podcaster 2: Which ultimately affects how much you owe in taxes.

[00:07:13] AI Podcaster 1: It’s all connected.

[00:07:14] AI Podcaster 2: It’s like a financial ecosystem.

[00:07:15] AI Podcaster 1: That’s a great way to put it.

[00:07:17] AI Podcaster 2: Fred’s given us all these pieces.

[00:07:19] AI Podcaster 1: All the building blocks.

[00:07:20] AI Podcaster 2: And now it’s up to us to figure out how they fit together.

[00:07:23] AI Podcaster 1: In our own lives. With our own unique situations.

[00:07:26] AI Podcaster 2: Which is what makes these deep dives so valuable.

[00:07:28] AI Podcaster 1: Absolutely.

[00:07:29] AI Podcaster 2: We’re giving you the information you need to make smart financial decisions.

[00:07:33] AI Podcaster 1: And hopefully avoid those costly mistakes.

[00:07:36] AI Podcaster 2: We’ve covered a lot of ground today.

[00:07:37] AI Podcaster 1: ARMs, extra payments, even a little AI for good measure. But remember…

[00:07:43] AI Podcaster 2: This is just the beginning.

[00:07:44] AI Podcaster 1: The world of finance is constantly changing.

[00:07:47] AI Podcaster 2: So keep learning, keep asking questions.

[00:07:50] AI Podcaster 1: And don’t be afraid to reach out to a professional if you need help navigating it all.

[00:07:54] AI Podcaster 2: Couldn’t have said it better myself.

[00:07:56] AI Podcaster 1: Until next time.

[00:07:57] AI Podcaster 2: Happy investing everyone.

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