Bright Idea

Are you a realtor who wants a reason to make that call to your former clients? How about a loan officer who wants to find a way to add value to their favorite real estate professional?

You likely know mortgage rates have dropped by nearly 1% since last August but you would be surprised how few of your clients are aware of the significant drop in rates. I recently heard rates are the lowest they have been in three years. So I researched it and last year the average Freddie Mac 30 year Rate was 4.55 with .55 Discount point. By contrast today rates are according to Feddie Mac is 3.6% with a .6 discount point (Freddie Mac published average on 8/8.

So maybe you are thinking – how does this help me if you are an agent? Well, we mentioned this to one of our many favorite agents, who has only been in the business 3+ years, and suggested she reach out to her clients and share the following idea. So often I hear my agent friends tell me they have “call reluctance” so we wrote a script for making the call:

“HI _______, did you know rates have dropped nearly a point since last year alone while values throughout metro atlanta have continued to rise. The result is this is a great time to contact a mortgage pro and have them review your current mortgage with you. You may be able to save significantly each month or go from a 30 year mortgage as example to a 15 year term and shave many years and much interest expense from your financial future. Please let me know and I can reconnect you with the loan officer I referred originally or introduce you to one of the many great pros I work with.”

This new agent did this and reconnect her buyers and lenders. In just 1 week, the results really were incredible:

  1. Out of approximately 30 closings, approximately 6 persons refinanced saving hundreds of dollars monthly in some cases with little to no cost.
  2. All of the clients were happy to hear from the agent.
  3. The loan officers appreciated her redirecting her clients back to them.
  4. And here’s the kicker, a couple of the people wanted to look at possibly buying another home due to the low rates.

Talk about a win-win win for the owner, the lender and the agent!

What an easy call to make. I encourage every loan officer to take this idea to their database of agents and agents to take the message to their clients. Of course we are here to help you get them closed but we would love to hear any success stories from this idea.

Good luck!

Fall is About Change

As we enter Fall, a big theme is change.  Change is happening in nature, but also throughout our industry.  For our realtor friends, we see changes with how real estate is sold, changes with how brokerages operate, business is developed, etc.  The same is true for those in the mortgage industry.  Mortgage professionals, like realtors, are seeing changes in the way they market, deliver services etc. Mortgage professionals also deal with Federal laws which regulate much of their industry (real estate agents, while also affected by Federal laws, are governed by State law). Changes adopted to TRID in 2018 go into effect October 1st.  Check in with your favorite mortgage professional to find out what’s new on a regulatory basis. Like the real estate and mortgage professionals there are changes going on in the closing industry.

Change is happening much faster in 2018 largely because of technology.  We are all on technology overload, and we have to sift through what is needed and can help us, and what is just “noise.”

Sometimes we change to solve a problem and create a new one. Years ago, funds in excess of $5,000 were not required to be delivered by wire. The “Great Recession” changed that. Georgia decided wires were the safer alternative.

Today we know wires are risky business.  With wires, the industry attracted cybercriminals intent on redirecting funds.  In past articles we have addressed this industry risk and how to mitigate.  If you have questions, ask your favorite S&D attorney to share our tips to protect yourself.

However, some innovations and changes are for the best.  Ten years ago, we did monthly bank account reconciliations manually.  Some firms did them internally, and some firms through outside auditors. Issues likely were not be caught for 30 days (if the auditor or staff was paying attention). Today, most firms, including ours use automated daily 3 way reconciliations to ensure the accuracy of their accounts.

Also, 10 years ago, fraudulent checks could be cashed at a branch and became major headaches for firms. Today our firm uses a bank product called Positive Pay to block fraudulent checks; only checks we pre-authorize to the bank (by a daily data upload) will be paid. Finally, 10 years ago, wires for payoffs and proceeds were much rarer and had to be called in.  Today, we initiate wires from our computer on-line at time of closing.   If the Seller doesn’t receive their funds within an hour after closing, we might get a call, wondering what is taking so long.

Technology leads to “faster”, and creates expectations to do, respond, address, download, upload etc. faster. When people are moving fast on computers they make potentially big mistakes.  So when dealing with those critical processes, slow down, and have a process to avoid costly mistakes.

Here are a couple of big changes in the not too distant future of closings –

E-closings.  Years ago our firm worked with one pioneer lender to do closings partially on-line. There is  major movement in this direction.   Our firm is exploring this and preparing for the future.  Some states will transition to this new technology faster.  Remember: real estate (unlike mortgages) is governed by state law.  But before too long like everything else expect to see some “closings in the cloud.”

Blockchain & Cryptocurrency in real estate transactions. Though likely not as imminent as e-closings, the buzz right now is to expect to see this relatively soon. At least a few people have asked if we accept bitcoins.  It seems cryptocurrency is presently for speculators and criminals (since they in theory allow for anonymity) but real applications for both cryptocurrency and blockchain are expected.

One thing that will never change is our commitment to you and your clients.  Our pledge to care, to improve and to serve, we hope will allow us to be successful regardless of changes within our industry!

The Real Estate Market is Hot

Reh! Quente! Atsui! Caliente! Hot!

So many languages and so many ways to say hot!  You know it when you see it and we are in a traditional hot month for real estate sales throughout the country and in Georgia!

Did you know that nationwide, June is traditionally the fastest month to sell a home?  So if you have listings right now or you’re a loan officer with successful listing agents you are probably very busy!

It’s  even better for all of us because the current economy worldwide and nationwide is hot.  Globally,  growth is “expected to reach 3.2 per cent in 2018 and 2019” which is robust  and in the United States, unemployment is at the lowest level since 2000  just 3.8%.

“But  wait…. There’s more!” as the infomercials say!  Our greatest optimism for real estate professionals (including realtors, agents, mortgage professionals, builders and closing agents) is what’s going on right here in Georgia!  Our employment growth and wage growth are both outpacing national averages.We have the busiest airport in world but more importantly we are currently #1 in corporate relocation.  That means jobs, which means more housing needs, which means more purchases, sales and financing opportunities.

Don’t let anyone tell you otherwise!  So  the Fed raised rates on June 13thand is signaling they may play a lesser role in keeping rates down.  Many of us are old enough to remember when fixed rates first dropped below 10% and we all cheered.  Perhaps ARMs will make a comeback but if we are employed and the local economy is booming you can make it big in real estate (and Shafritz & Dean is here to help!).

Be excited and be ready because this is haymaking season and for those of us who survived the Great Recession it’s time to make up for lost time, lost profits and well, just plain old losses. However, don’t forget that word recession, because cycles happen so make sure you squirrel some away for the rainy day.

At Shafritz & Dean, LLC we are hot, but we are never too busy for your referrals,  never too busy to help you with your contracts, your loans, your questions and your business!