April 18, 2024 • 27 mins
MGIC Connects Podcast interviews Marc Williams, Senior Loan Officer at Paramount Residential Mortgage Group. Marc is responsible for developing and providing mortgage loans, training and business consultations to consumers and industry partners throughout the state of Florida. Through his educational seminars on homeownership and foreclosures, Marc offers individuals help with developing self-reliance and control over their own economic destiny. In this episode, we discuss:
- The challenges of homeownership, from low inventory to affordability
- How to lay the foundation for generational wealth through smart real estate investment
- The advantages of down payment assistance programs and how they're reshaping the landscape for new investors
- Strategic benefits of multi-unit property ownership
Marc shares the wisdom he has gained from his years in the housing industry. You'll learn how financial literacy and a shrewd grasp of loan products can be game-changers for prospective homeowners, especially those venturing into the market for the first time.
Thanks for listening to Mortgage Connects, an MGIC podcast. If you have questions, comments, or want to get involved, send an email to mortgageconnects@mgic.com.
Looking for even more expert insights? Check out our mortgage industry content portal, Mortgage Connects knowledge hub. Subscribe today so you don't miss out on the latest! Subscribe
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Episode Transcript
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Speaker 1 (00:03):
Welcome to Mortgage Connects by MGIC, bringing you
the latest insights from topmortgage professionals around
the industry.
I'm your host, stephanieBudnick, and today we have Mark
Williams, senior Loan Officerfrom Paramount Residential
Mortgage Group.
Mark has been responsible fordeveloping and providing
mortgage loans, training andbusiness consultations to so
(00:24):
many individuals throughout thestate of Florida.
Through his educationalseminars on homeownerships and
foreclosures, he's offeredindividual self-reliance and
control over their economicdestiny.
Hi, mark, thank you so much forbeing here with us today.
I'm very excited about today'sepisode.
Speaker 2 (00:43):
Thank you, stephanie.
I'm glad I'm here, just reallyglad to be here and honored to
just kind of share a lot of theinformation that's out there as
well.
So thank you for having me on.
Speaker 1 (00:55):
Absolutely.
If you don't mind, can you justgive our viewers a little bit
of background on where you camefrom and why you're so
passionate about what we'retalking about today?
Speaker 2 (01:03):
Great.
So once again, it's a pleasureto be here.
I've been in this industry ofhousing or real estate for the
last three decades and so I'm alicensed real estate agent and a
licensed loan officer, becauseI wasn't always that.
I started off working for a HUDcertified counseling agency and
(01:27):
I'll talk a little about thattoday as well and I was a
director of a housing agencythat helped a lot of first-time
homebuyers really understand howto prepare themselves for home
ownership and then beingpre-qualified or qualified by a
local lender.
And so I decided hey, with allthat work, why not become the
(01:47):
loan officer?
Work with the lender in tandemand really being there in that
space and then also being ableto help a lot of first-time
homebuyers understand the realestate market.
So that just led into thattransition of also getting a
real estate license.
But that's a little bit aboutme.
I'm really passionate aboutaffordable housing and
(02:08):
definitely down payment andclosing cost assistance programs
, which I'll talk a little bitabout as well.
So glad to be here and glad tojust kind of share a lot of that
information.
Speaker 1 (02:17):
Awesome Thanks.
Well, what I would love tostart with is maybe just about
early on, because you know weall have a foundation and it
helps us get to where we are.
So have you, in your earlyexperiences in sustainable
homeownership and financialeducation, influenced your
approach to helping borrowers asa loan officer?
Speaker 2 (02:36):
Yes, it absolutely has.
So great question and I'll saythe deeper the understanding I
have related to what pain pointsa lot of first-time homebuyers
are going through really helpedme understand how to help them.
Remember I was mentioning thatstarting off with a
(02:56):
HUD-certified counseling agencyreally helped a lot of those
first-time homebuyers understandfinancial literacy, looking at
their budget, creating aspending plan, saving for their
down payment.
So early on I was exposed tohelping that client based on a
(03:17):
lot of the information that Ihad resources to, and so
financial education was key tohelping empower them, and so I
would say definitely just adeeper understanding of what to
look for, how to guide them.
Maybe they weren't readyimmediately, maybe they were
working on credit and theyneeded to wait three months or
(03:38):
six months to a year, but thatwas okay, and understanding that
point of view from a HUDcertified counseling position
really helped me to have thatconversation in a way that
prepared them short term or longterm for that home ownership
process.
Speaker 1 (03:54):
Yeah, that really sounds like it allows the
individual, from your earlyexperience, to shape their
outlook on sustainable homeownership.
Their outlook on sustainablehome ownership.
I know when we went to look tobuy our first home, we didn't
really know what to even thinkabout, what to do, how to assume
a budget and not just what themortgage payment was, because
there's so much more than justthat to it.
(04:16):
So, from the budgetingperspective, there was a lot
more than that you think about.
So I love the passion that youshare behind that and how that
helps.
Great that you think about.
So I love the passion that youshare behind that and how that
helps.
Speaker 2 (04:25):
Great, thank you.
Speaker 1 (04:28):
So, thinking about today's market and some of the
challenges that we have, whatare some of the biggest
challenges facing homebuyers intoday's current market in your
opinion?
Speaker 2 (04:38):
You know that's another phenomenal question and
I would say there's typicallythree that we're seeing
Definitely low inventory outthere in the market,
unfortunately tightened lendingstandards and then definitely
affordability as a whole.
So, in talking about the lowinventory, a lot of individuals
(05:01):
right now who are first-timehomebuyers and are searching for
properties realize that there'sa shortage of available homes,
right Homes for sale, whichlessens their opportunities to
purchase right, based on thefact that property values are
increasing.
And in addition to that, it'sjust the competition that's out
there for a lot of first-timehomebuyers is kind of daunting
(05:24):
if they don't understand whatthe next steps are, right.
So we have to understand thatwe have to educate buyers on how
to budget, how to look forproperties that are within their
budget and price point andrealizing that, hey, this is a
starter home for you.
It doesn't necessarily meanyou're going to be in this home
(05:45):
30 years from now, right, butyou've got to get in the game.
And I think when we talk aboutsome of those challenges the low
inventory, but also the mindsetfor a lot of buyers it's also
something that sometimes needsto be changed.
And when I talk about the typeof lending standards, right.
So it's really important thatfirst-time homebuyers tap into
(06:06):
their lenders, understand whatproducts are best suited for
them, whether it be down paymentassistance or whether it be a
type of loan that talks to theircredit score.
Maybe it's an FHA productcompared to a conventional loan
product.
So, understanding what thoseguidelines are and how tightened
those guidelines are, I trulybelieve that the better you
(06:29):
understand the requirements, theeasier it is to kind of play
the game, if you will, and so Iurge folks to always be thinking
about those standards.
And then affordability.
A lot of first-time homebuyersbelieve that homeownership is
about and I did.
I know I did that white picketfence, two-car garage,
(06:51):
overlooking the ocean and all ofthat and not necessarily
understanding.
You have to get in the game ofwhere you are, and so
affordability is going to be anissue.
I've had some families thathave said you know what, okay,
I'll call my mother-in-law, whoI don't like, I call my brother,
who I may not like, and I'mgoing to buy a home with them,
(07:12):
but now I'm in the game and I'mable to purchase something and
I'm not restricted to whateverjust alone my income might look
like.
So now I'm more competitive inthe market when I make an offer
because I'm pulling all my otherresources together financially
in order to get in the game.
So I get it.
(07:33):
But I would say those would bethe three low inventory,
affordability and definitelytight and lending standards.
You gotta know what thosestandards are.
Speaker 1 (07:42):
There are so many items that you hit on there that
I kind of want to highlight forour audience.
I think mindset was one of thebiggest takeaways that I just
took away from your answer.
Whether that be that I can'thave this high image of a house,
that I think for my first house, is that you need to shift
right and get in the game,understand that it might not be
(08:03):
just what you think it was goingto be, but again you're
building equity instead ofrenting where you're not able to
do any of that.
So I really appreciated thatmindset and level there.
And then, in addition to that,I think, the education piece,
not only for the consumer, butto remind loan officers every
(08:25):
day to be so you know, educatedwithin their markets, to
understand what's available.
Because I know for sure if Italked to my friend next door,
they would have no idea.
If I told them, well, did youlook into any down payment
assistance program?
And they would be like I don'tneed that or I don't, you know,
they just don't even think thatthey will qualify.
(08:46):
Those are really key takeawaysthere.
Are there any other ways thatyou can foresee that people can
overcome these challenges thatyou're seeing in the market?
Speaker 2 (08:57):
So I would say, definitely reaching out to a HUD
certified counseling agency inyour area.
So if you go to FHAgov FederalHousing Administration, you can
tap into those types ofresources in your local area.
There are easily over 2,500HUD-certified counseling
(09:19):
agencies nationwide and whatthey have been chartered to do
is really help first-timehomebuyers understand budgeting,
understand homeownership as awhole, financial literacy.
All of those are components ofthe HUD-certified counseling
agency, among other things, suchas credit.
So I would say, seek financialguidance by reaching out to
(09:43):
those HUD-certified counselingagencies and then looking for
creative financing solutions.
Right, and I'm a firm believerthat education is all about
empowerment.
So when you're seeking thoseknowledge and those resources,
you also, as that homebuyer,have to feel comfortable in
asking the hard questions andrealizing that you might not be
(10:05):
ready today, as I mentioned, butit doesn't mean that you
couldn't be ready in threemonths, you couldn't be ready in
six months.
And what I've seen, Stephanie,is a lot of individuals
self-select themselves out ofthe process by all this
information that they're getting, whether it be a friend told me
or a family member told me, orI searched on the internet and I
(10:31):
looked at what came up first.
That might not be the bestresource right.
So do your due diligence andget as much information as
possible to be able to continueto grow and overcome those
challenges.
Speaker 1 (10:41):
Yeah, assumptions aren't good for anybody.
I've learned that at a veryyoung age.
One of the other things that,when we had earlier
conversations, the thing thatyou were passionate about was
closing the racial homeownership gap, and I wanted to
touch a little bit on that as wetalk about challenges that we
have in our market and our dayto day, and so we've made some
(11:02):
great strides in that area.
So how has the mortgageindustry's focus on narrowing
the racial homeownership gapevolved in recent years, and
what are the key elements ofthis emphasis?
Speaker 2 (11:14):
So a big buzzword and this is another wonderful
question because I've dealt withso many lower modern income
families that are strugglingright now on one understanding
the home ownership process butrealizing that unfortunately
they're in that gap as itrelates to, maybe, race or even
(11:37):
income and affordability.
And so one of the big bigthings that are out there right
now are diversity, equity andinclusion initiatives, dei
initiatives and I love thembecause a lot of workforce
housing, a lot of workforceentities that are out there and
(12:00):
nonprofit and housing counselingagencies are really looking
forward to pushing those typesof initiatives to close that gap
.
And they do that by creatinghome ownership centers providing
information to all differentethnic groups and races to be
able to make sure that whatevermedia messages that we're
(12:22):
putting out there, that it canbe interpreted correctly, right,
because sometimes, as even loanofficers and real estate agents
, we understand jargon andterminology from doing this day
in and day out, but for theaverage consumer they might not
understand what an adjustment intheir rate may be, they may not
understand what their creditscore really truly is when a
(12:45):
mortgage professional pullstheir credit report.
So I think the more inclusionthat we have, the more diversity
that we have, the easier itwill be to close those gaps.
We're also noticing that therearen't that many loan officers
or professionals in certainmarkets that look like them
(13:08):
right, or look like me.
So they're doing a lot ofinitiatives now on a national
and a local level to try andencourage housing professionals
to be a part of the industry, tomaking sure that those changes
are there.
And then fair lending practices.
You know we're coming out ofwe're still in the middle of it
(13:29):
Fair Housing Month right April.
There are a lot of communitiesthat have been affected due to
redlining, due to income, due toaffordability, and so we have
to make sure, as loan officersand housing professionals, that
we're providing good lending,that we're not creating any
redlining situations orpredatory lending situations
(13:52):
that deter a home buyer fromreally purchasing a home or
getting information that's greatinformation.
And then the other part of thatis down payment assistance
programs.
We've got to put as muchinformation out there, which is
my passion about down paymentassistance programs.
So for the average individualand I was looking at a study by
(14:13):
the National Association ofRealtors, nar, where they
identified that the averageindividual between the ages of
35 to 44 has, on median, about$27,000 saved for their purchase
of a home and on average, it'sreally about $4,700, right.
(14:35):
And so I say that and I sharethat, because I don't know too
many people that have $27,000 inthe purchase of a home, right,
when we know that you're using3% of that, or even 4.5% of that
, to cover all your down paymentand your closing costs.
So those are the issues that Ithink a lot of individuals are
(14:56):
gonna see and that's the waythat we kind of close the gap
Affordable housing initiatives,definitely looking to diversity
and equity inclusion types ofinitiatives as well and then
contact your local fair housingorganization and making sure
that you're a part of what thosepolicies look like for your
(15:18):
communities in order to helpclose that gap.
Speaker 1 (15:21):
Yeah, there are a lot of different misconceptions
that it comes to, you know, inthe mortgage process, whether
that people still believe in any20% down, which, to that point,
it's like, okay, I'm nevergoing to get there with today's
market, living with other familymembers.
I think it's just creating moreof an awareness as well, from
(15:52):
building generational wealth andunderstanding that that's
acceptable to do and like, yes,just get into the home, get
started and you're able to dothat.
Are there any other ways thatyou feel that we can do a better
job of building thatgenerational wealth?
Is it just behind the educationaspect, or are there other
components in which we can dothat?
Speaker 2 (16:08):
I think the example that you reiterated related to
doubling up on incomes is agreat way and realizing that
five years from now, seven yearsfrom now, if your income
changes, it doesn't mean thatyou can refinance and take that
other individual off.
So you have to put that inperspective as well.
(16:29):
But in addition to that, Iwould say, you know, looking at
other opportunities related toaffordable housing, there are a
lot of affordable housingdevelopers that have been
chartered to build affordablehousing units within certain
areas.
Now some people might say, well, I don't want to purchase in
(16:50):
that area because that area isthis and it looks like that.
And I say this getting in theprocess of buying a home is so
key.
We're coming off a market wherethe last year to two years,
values in certain areas haveincreased by 221%.
(17:13):
Now I say to the naysayer orthe home buyer now, if you had
waited or if you didn't wait,you'd be able to take advantage
of that value and increase.
So when we talk about buildingwealth, that's how you build
wealth.
The dynasties, the family, thehuge multi-billion dollar
(17:35):
families of the world,individuals of the world they
always have real estate as apart of their portfolio.
They may do so many otherthings, business-wise,
investing-wise, but for theaverage American, the way to
build wealth is always throughproperty and increasing your
value and knowing exactly whento buy and when to sell.
(17:59):
So those would be the thingsthat I would mention tapping
into a lot of affordable housingdevelopers, as I mentioned, who
have been chartered to buildaffordable housing within
communities to be able to keepthat affordability low, at a
price point that you can getinto the market and afford it.
Speaker 1 (18:17):
You know, being closer to 40, for me, I know a
lot of my friends have duplexesand they have other things that
they are doing to grow that,their own wealth.
And so it's really interestingtoo to think about, because
until my husband and I startedhearing about multiple couples
that literally live in the samecul-de-sac as us having multiple
(18:40):
properties, we were like, oh mygosh, even even being in the
industry I wouldn't really thinkabout, I'm going to go buy, you
know this to do that.
And I think that that's evenmore of a point too, that
everybody needs education.
It's not the first time homebuyer, because there's so much
to learn about the advantagesthat you can set yourself up for
(19:00):
.
Speaker 2 (19:01):
Right, you know, and so you mentioned the duplexes,
and I love that.
That's another great example ofbeing able to get into the game,
if you will, and understandingthat it's also about the
investment correct and thosetypes of investment properties.
So, remember, we talked a littlebit about the tightening
lending guidelines, right, andso lending guidelines in the
(19:22):
last eight months or so havealso shifted, related to
duplexes.
So now it used to be a pointwhere you had to put down 15 to
20 percent right to be able topurchase a duplex.
Now Fannie Mae, freddie Machave changed the guidelines
related to that and now you canonly, you only have to put down
(19:43):
a minimum of 5 percent, right.
So big difference you only haveto put down a minimum of 5%,
right.
So that's a game changer for alot of families.
And then being able to countthe rental income from those
other units as well to helpoffset your income in a duplex
75% of that.
So that helps increase yourbuying power, right?
And I tell my family I say,listen, it's time for us to
(20:04):
start really looking at duplexesor triplexes and putting people
that are family members on oneunit and being able to own that
totally.
So I love that and I thank youfor that example.
Speaker 1 (20:16):
Yeah, I think that that even goes to the fact of
you being willing to live withother family members.
It even makes it a little bitmore that you have your own
place.
It doesn't feel like, OK, well,they're literally in the room
next to me.
It gives them a little bit more,you know, ability to be on
their own, so I wanted to talk alittle bit more about some of
(20:37):
the critical partnerships thatwe can utilize for financial
literacy, and you did talk a lotabout HUD agencies already.
Are there other partnershipsthat loan officers should look
at?
Getting you know, invested intolearning more about that can
help within their communities.
Speaker 2 (20:54):
Yes.
So nonprofits, your localnonprofits.
You'd be surprised that some ofthe local nonprofits have
housing as a component of theirservices.
So I would say, tapping intothe nonprofits to be able to do
that because they're going totalk similar to the housing
(21:16):
agencies about budgeting, aboutcredit repair and things of that
nature but help navigate themthrough that process of
homeownership.
So, definitely your localnonprofits.
And then also reach out to yourlocal housing authorities,
right.
And housing agencies throughthe city, through the local
county government.
(21:36):
They have also been charteredto not only tap into down
payment and closing costassistance for you as a
first-time home buyer andclosing cost assistance for you
as a first-time homebuyer oreven to really help as a loan
officer for you to get educated.
But those are great resourcesto help you, as that loan
officer, have in your toolbox,in your arsenal, to be able to
(21:58):
say you know what, I can pointthat homebuyer in the right
direction, or how can I sit onmy local community board to be a
part of that initiative thatthat local nonprofit or that
housing agency and housingauthority is trying to push in
the community?
And then community reinvestmentagencies, right.
(22:20):
So the Community ReinvestmentAct was an act that basically
said, we're going to deal withthis issue of home ownership
across our nation, so localbanking institutions have to, as
a part of their charter, mustalso lend but also open up home
(22:41):
ownership to certain communities, and so that's where you're
going to see a lot of thoseproducts that are now geared
towards specific census tractsto really help that first-time
homebuyer.
So what I tell a loan officer isyou've got to understand in
your lending institution oranother lending institution
where those census tracts are,because those are opportunities
(23:04):
for you as a professional toshare valuable information and
to tap into those resources, andI also say your human resources
departments, for a lot ofmid-sized to large-level
businesses may or may not have,but may have a homeownership
benefit and component that youas a loan officer can tap into
(23:26):
and say hey, you know what Iwant to see, how I can do
possibly a lunch and learn.
I want to come out and make apresentation on maybe down
payment assistance or our loanproducts, because I understand
that there are a lot ofindividuals who may already own
their home that may become avictim to foreclosure, may
already own their home that maybecome a victim to foreclosure,
(23:47):
and I want to share informationon how we can help refinance
their home and help them, but Ialso want to share information
about down payment assistance.
So it's all I believe,stephanie, about really
connecting those pieces andfilling in those gaps, as that
loan officer, professional oreven real estate agent to be
able to say you know what, thisis, what we can offer.
(24:13):
This is how I want to be ofvalue a value agent, if you will
to that overall process ofhomeownership, and that's how I
think that we can effectivelychange communities by loan
officers, real estate agents,not just looking at it as a
transaction of the state agents,not just looking at it as a
transaction, but more looking atit as how you transform the
individual that you're workingwith.
Speaker 1 (24:32):
I think that that's so powerful for everybody, even
around that person, to be ableto do that.
We also are very passionateabout similar products and
bringing information to helpingthe loan officer better
understand.
How do I leverage it like, justlike you mentioned, a human
resource angle.
That's not a normal thoughtprocess.
That's like, oh no, I just Ijust talked to real estate
(24:54):
agents and then maybe I'mdiverse enough and I'm financial
advisors too, but again,there's so many different ways
to try to overcome thataffordability challenge.
I think that these are greatresources for that.
Love it, mark.
We're coming to the end of ourepisode here.
I just wanted to let you leaveus with a lasting comment,
(25:16):
because I have enjoyed thisconversation so much today,
anything that we can leave ouraudience with today.
Speaker 2 (25:23):
Thank you for that, and so what I will say is, for
the professionals that are outthere and those individuals that
are doing this day in and dayout, I salute you, I applaud the
work that you're doing.
I will say that you are reallyand I heard this the other day
the power behind the transaction, and also not looking at it as
(25:46):
a transaction that I mentioned,but also how we transform
individuals, transformcommunities.
I think you know the saying isrising tide right Lifts all
ships boats.
And so I say that because I'm afirm believer, over the years
that I've been doing this, thatthe most rewarding thing is to
(26:09):
work with a first-time homebuyerthat might be marginalized,
might not understand the overallprocess and the moment that
that light bulb turns on andthey get it, they follow the
steps to become a homeowner andthen they get the keys at the
end, and they still doesn't stopright there You're also talking
(26:30):
about now.
They're on the path to trulyunderstanding homeownership and
wealth building for theircommunity and wealth building
for themselves and how they arepart of their community, and so
I leave you with that, justremembering that you are really
the power behind the transactionand the better that we are of
getting great information outthere and realizing that people
(26:52):
do business with who they likeand trust no like and trust.
That's the easier part of allour business and it always comes
back.
I truly believe that.
So I thank you again for havingme on.
It was a pleasure and I lookforward to hearing from you all
again and seeing if we cancontinue to just push the
(27:14):
envelope a little bit more onhow we connect with our
homebuyers.
Speaker 1 (27:18):
Mark, thank you so much.
Speaker 2 (27:19):
Thank you for having me on.
Speaker 1 (27:21):
Thanks for listening.
For all the latest industryinsights, subscribe to Mortgage
Connects on Apple Stitcher,google Podcasts, spotify, amazon
Music or simply go tomortgageconnectscom.
Welcome to Mortgage Connects by MGIC, bringing you
the latest insights from topmortgage professionals around
the industry.
I'm your host, stephanieBudnick, and today we have Mark
Williams, senior Loan Officerfrom Paramount Residential
Mortgage Group.
Mark has been responsible fordeveloping and providing
mortgage loans, training andbusiness consultations to so
(00:24):
many individuals throughout thestate of Florida.
Through his educationalseminars on homeownerships and
foreclosures, he's offeredindividual self-reliance and
control over their economicdestiny.
Hi, mark, thank you so much forbeing here with us today.
I'm very excited about today'sepisode.
Speaker 2 (00:43):
Thank you, stephanie.
I'm glad I'm here, just reallyglad to be here and honored to
just kind of share a lot of theinformation that's out there as
well.
So thank you for having me on.
Speaker 1 (00:55):
Absolutely.
If you don't mind, can you justgive our viewers a little bit
of background on where you camefrom and why you're so
passionate about what we'retalking about today?
Speaker 2 (01:03):
Great.
So once again, it's a pleasureto be here.
I've been in this industry ofhousing or real estate for the
last three decades and so I'm alicensed real estate agent and a
licensed loan officer, becauseI wasn't always that.
I started off working for a HUDcertified counseling agency and
(01:27):
I'll talk a little about thattoday as well and I was a
director of a housing agencythat helped a lot of first-time
homebuyers really understand howto prepare themselves for home
ownership and then beingpre-qualified or qualified by a
local lender.
And so I decided hey, with allthat work, why not become the
(01:47):
loan officer?
Work with the lender in tandemand really being there in that
space and then also being ableto help a lot of first-time
homebuyers understand the realestate market.
So that just led into thattransition of also getting a
real estate license.
But that's a little bit aboutme.
I'm really passionate aboutaffordable housing and
(02:08):
definitely down payment andclosing cost assistance programs
, which I'll talk a little bitabout as well.
So glad to be here and glad tojust kind of share a lot of that
information.
Speaker 1 (02:17):
Awesome Thanks.
Well, what I would love tostart with is maybe just about
early on, because you know weall have a foundation and it
helps us get to where we are.
So have you, in your earlyexperiences in sustainable
homeownership and financialeducation, influenced your
approach to helping borrowers asa loan officer?
Speaker 2 (02:36):
Yes, it absolutely has.
So great question and I'll saythe deeper the understanding I
have related to what pain pointsa lot of first-time homebuyers
are going through really helpedme understand how to help them.
Remember I was mentioning thatstarting off with a
(02:56):
HUD-certified counseling agencyreally helped a lot of those
first-time homebuyers understandfinancial literacy, looking at
their budget, creating aspending plan, saving for their
down payment.
So early on I was exposed tohelping that client based on a
(03:17):
lot of the information that Ihad resources to, and so
financial education was key tohelping empower them, and so I
would say definitely just adeeper understanding of what to
look for, how to guide them.
Maybe they weren't readyimmediately, maybe they were
working on credit and theyneeded to wait three months or
(03:38):
six months to a year, but thatwas okay, and understanding that
point of view from a HUDcertified counseling position
really helped me to have thatconversation in a way that
prepared them short term or longterm for that home ownership
process.
Speaker 1 (03:54):
Yeah, that really sounds like it allows the
individual, from your earlyexperience, to shape their
outlook on sustainable homeownership.
Their outlook on sustainablehome ownership.
I know when we went to look tobuy our first home, we didn't
really know what to even thinkabout, what to do, how to assume
a budget and not just what themortgage payment was, because
there's so much more than justthat to it.
(04:16):
So, from the budgetingperspective, there was a lot
more than that you think about.
So I love the passion that youshare behind that and how that
helps.
Great that you think about.
So I love the passion that youshare behind that and how that
helps.
Speaker 2 (04:25):
Great, thank you.
Speaker 1 (04:28):
So, thinking about today's market and some of the
challenges that we have, whatare some of the biggest
challenges facing homebuyers intoday's current market in your
opinion?
Speaker 2 (04:38):
You know that's another phenomenal question and
I would say there's typicallythree that we're seeing
Definitely low inventory outthere in the market,
unfortunately tightened lendingstandards and then definitely
affordability as a whole.
So, in talking about the lowinventory, a lot of individuals
(05:01):
right now who are first-timehomebuyers and are searching for
properties realize that there'sa shortage of available homes,
right Homes for sale, whichlessens their opportunities to
purchase right, based on thefact that property values are
increasing.
And in addition to that, it'sjust the competition that's out
there for a lot of first-timehomebuyers is kind of daunting
(05:24):
if they don't understand whatthe next steps are, right.
So we have to understand thatwe have to educate buyers on how
to budget, how to look forproperties that are within their
budget and price point andrealizing that, hey, this is a
starter home for you.
It doesn't necessarily meanyou're going to be in this home
(05:45):
30 years from now, right, butyou've got to get in the game.
And I think when we talk aboutsome of those challenges the low
inventory, but also the mindsetfor a lot of buyers it's also
something that sometimes needsto be changed.
And when I talk about the typeof lending standards, right.
So it's really important thatfirst-time homebuyers tap into
(06:06):
their lenders, understand whatproducts are best suited for
them, whether it be down paymentassistance or whether it be a
type of loan that talks to theircredit score.
Maybe it's an FHA productcompared to a conventional loan
product.
So, understanding what thoseguidelines are and how tightened
those guidelines are, I trulybelieve that the better you
(06:29):
understand the requirements, theeasier it is to kind of play
the game, if you will, and so Iurge folks to always be thinking
about those standards.
And then affordability.
A lot of first-time homebuyersbelieve that homeownership is
about and I did.
I know I did that white picketfence, two-car garage,
(06:51):
overlooking the ocean and all ofthat and not necessarily
understanding.
You have to get in the game ofwhere you are, and so
affordability is going to be anissue.
I've had some families thathave said you know what, okay,
I'll call my mother-in-law, whoI don't like, I call my brother,
who I may not like, and I'mgoing to buy a home with them,
(07:12):
but now I'm in the game and I'mable to purchase something and
I'm not restricted to whateverjust alone my income might look
like.
So now I'm more competitive inthe market when I make an offer
because I'm pulling all my otherresources together financially
in order to get in the game.
So I get it.
(07:33):
But I would say those would bethe three low inventory,
affordability and definitelytight and lending standards.
You gotta know what thosestandards are.
Speaker 1 (07:42):
There are so many items that you hit on there that
I kind of want to highlight forour audience.
I think mindset was one of thebiggest takeaways that I just
took away from your answer.
Whether that be that I can'thave this high image of a house,
that I think for my first house, is that you need to shift
right and get in the game,understand that it might not be
(08:03):
just what you think it was goingto be, but again you're
building equity instead ofrenting where you're not able to
do any of that.
So I really appreciated thatmindset and level there.
And then, in addition to that,I think, the education piece,
not only for the consumer, butto remind loan officers every
(08:25):
day to be so you know, educatedwithin their markets, to
understand what's available.
Because I know for sure if Italked to my friend next door,
they would have no idea.
If I told them, well, did youlook into any down payment
assistance program?
And they would be like I don'tneed that or I don't, you know,
they just don't even think thatthey will qualify.
(08:46):
Those are really key takeawaysthere.
Are there any other ways thatyou can foresee that people can
overcome these challenges thatyou're seeing in the market?
Speaker 2 (08:57):
So I would say, definitely reaching out to a HUD
certified counseling agency inyour area.
So if you go to FHAgov FederalHousing Administration, you can
tap into those types ofresources in your local area.
There are easily over 2,500HUD-certified counseling
(09:19):
agencies nationwide and whatthey have been chartered to do
is really help first-timehomebuyers understand budgeting,
understand homeownership as awhole, financial literacy.
All of those are components ofthe HUD-certified counseling
agency, among other things, suchas credit.
So I would say, seek financialguidance by reaching out to
(09:43):
those HUD-certified counselingagencies and then looking for
creative financing solutions.
Right, and I'm a firm believerthat education is all about
empowerment.
So when you're seeking thoseknowledge and those resources,
you also, as that homebuyer,have to feel comfortable in
asking the hard questions andrealizing that you might not be
(10:05):
ready today, as I mentioned, butit doesn't mean that you
couldn't be ready in threemonths, you couldn't be ready in
six months.
And what I've seen, Stephanie,is a lot of individuals
self-select themselves out ofthe process by all this
information that they're getting, whether it be a friend told me
or a family member told me, orI searched on the internet and I
(10:31):
looked at what came up first.
That might not be the bestresource right.
So do your due diligence andget as much information as
possible to be able to continueto grow and overcome those
challenges.
Speaker 1 (10:41):
Yeah, assumptions aren't good for anybody.
I've learned that at a veryyoung age.
One of the other things that,when we had earlier
conversations, the thing thatyou were passionate about was
closing the racial homeownership gap, and I wanted to
touch a little bit on that as wetalk about challenges that we
have in our market and our dayto day, and so we've made some
(11:02):
great strides in that area.
So how has the mortgageindustry's focus on narrowing
the racial homeownership gapevolved in recent years, and
what are the key elements ofthis emphasis?
Speaker 2 (11:14):
So a big buzzword and this is another wonderful
question because I've dealt withso many lower modern income
families that are strugglingright now on one understanding
the home ownership process butrealizing that unfortunately
they're in that gap as itrelates to, maybe, race or even
(11:37):
income and affordability.
And so one of the big bigthings that are out there right
now are diversity, equity andinclusion initiatives, dei
initiatives and I love thembecause a lot of workforce
housing, a lot of workforceentities that are out there and
(12:00):
nonprofit and housing counselingagencies are really looking
forward to pushing those typesof initiatives to close that gap
.
And they do that by creatinghome ownership centers providing
information to all differentethnic groups and races to be
able to make sure that whatevermedia messages that we're
(12:22):
putting out there, that it canbe interpreted correctly, right,
because sometimes, as even loanofficers and real estate agents
, we understand jargon andterminology from doing this day
in and day out, but for theaverage consumer they might not
understand what an adjustment intheir rate may be, they may not
understand what their creditscore really truly is when a
(12:45):
mortgage professional pullstheir credit report.
So I think the more inclusionthat we have, the more diversity
that we have, the easier itwill be to close those gaps.
We're also noticing that therearen't that many loan officers
or professionals in certainmarkets that look like them
(13:08):
right, or look like me.
So they're doing a lot ofinitiatives now on a national
and a local level to try andencourage housing professionals
to be a part of the industry, tomaking sure that those changes
are there.
And then fair lending practices.
You know we're coming out ofwe're still in the middle of it
(13:29):
Fair Housing Month right April.
There are a lot of communitiesthat have been affected due to
redlining, due to income, due toaffordability, and so we have
to make sure, as loan officersand housing professionals, that
we're providing good lending,that we're not creating any
redlining situations orpredatory lending situations
(13:52):
that deter a home buyer fromreally purchasing a home or
getting information that's greatinformation.
And then the other part of thatis down payment assistance
programs.
We've got to put as muchinformation out there, which is
my passion about down paymentassistance programs.
So for the average individualand I was looking at a study by
(14:13):
the National Association ofRealtors, nar, where they
identified that the averageindividual between the ages of
35 to 44 has, on median, about$27,000 saved for their purchase
of a home and on average, it'sreally about $4,700, right.
(14:35):
And so I say that and I sharethat, because I don't know too
many people that have $27,000 inthe purchase of a home, right,
when we know that you're using3% of that, or even 4.5% of that
, to cover all your down paymentand your closing costs.
So those are the issues that Ithink a lot of individuals are
(14:56):
gonna see and that's the waythat we kind of close the gap
Affordable housing initiatives,definitely looking to diversity
and equity inclusion types ofinitiatives as well and then
contact your local fair housingorganization and making sure
that you're a part of what thosepolicies look like for your
(15:18):
communities in order to helpclose that gap.
Speaker 1 (15:21):
Yeah, there are a lot of different misconceptions
that it comes to, you know, inthe mortgage process, whether
that people still believe in any20% down, which, to that point,
it's like, okay, I'm nevergoing to get there with today's
market, living with other familymembers.
I think it's just creating moreof an awareness as well, from
(15:52):
building generational wealth andunderstanding that that's
acceptable to do and like, yes,just get into the home, get
started and you're able to dothat.
Are there any other ways thatyou feel that we can do a better
job of building thatgenerational wealth?
Is it just behind the educationaspect, or are there other
components in which we can dothat?
Speaker 2 (16:08):
I think the example that you reiterated related to
doubling up on incomes is agreat way and realizing that
five years from now, seven yearsfrom now, if your income
changes, it doesn't mean thatyou can refinance and take that
other individual off.
So you have to put that inperspective as well.
(16:29):
But in addition to that, Iwould say, you know, looking at
other opportunities related toaffordable housing, there are a
lot of affordable housingdevelopers that have been
chartered to build affordablehousing units within certain
areas.
Now some people might say, well, I don't want to purchase in
(16:50):
that area because that area isthis and it looks like that.
And I say this getting in theprocess of buying a home is so
key.
We're coming off a market wherethe last year to two years,
values in certain areas haveincreased by 221%.
(17:13):
Now I say to the naysayer orthe home buyer now, if you had
waited or if you didn't wait,you'd be able to take advantage
of that value and increase.
So when we talk about buildingwealth, that's how you build
wealth.
The dynasties, the family, thehuge multi-billion dollar
(17:35):
families of the world,individuals of the world they
always have real estate as apart of their portfolio.
They may do so many otherthings, business-wise,
investing-wise, but for theaverage American, the way to
build wealth is always throughproperty and increasing your
value and knowing exactly whento buy and when to sell.
(17:59):
So those would be the thingsthat I would mention tapping
into a lot of affordable housingdevelopers, as I mentioned, who
have been chartered to buildaffordable housing within
communities to be able to keepthat affordability low, at a
price point that you can getinto the market and afford it.
Speaker 1 (18:17):
You know, being closer to 40, for me, I know a
lot of my friends have duplexesand they have other things that
they are doing to grow that,their own wealth.
And so it's really interestingtoo to think about, because
until my husband and I startedhearing about multiple couples
that literally live in the samecul-de-sac as us having multiple
(18:40):
properties, we were like, oh mygosh, even even being in the
industry I wouldn't really thinkabout, I'm going to go buy, you
know this to do that.
And I think that that's evenmore of a point too, that
everybody needs education.
It's not the first time homebuyer, because there's so much
to learn about the advantagesthat you can set yourself up for
(19:00):
.
Speaker 2 (19:01):
Right, you know, and so you mentioned the duplexes,
and I love that.
That's another great example ofbeing able to get into the game,
if you will, and understandingthat it's also about the
investment correct and thosetypes of investment properties.
So, remember, we talked a littlebit about the tightening
lending guidelines, right, andso lending guidelines in the
(19:22):
last eight months or so havealso shifted, related to
duplexes.
So now it used to be a pointwhere you had to put down 15 to
20 percent right to be able topurchase a duplex.
Now Fannie Mae, freddie Machave changed the guidelines
related to that and now you canonly, you only have to put down
(19:43):
a minimum of 5 percent, right.
So big difference you only haveto put down a minimum of 5%,
right.
So that's a game changer for alot of families.
And then being able to countthe rental income from those
other units as well to helpoffset your income in a duplex
75% of that.
So that helps increase yourbuying power, right?
And I tell my family I say,listen, it's time for us to
(20:04):
start really looking at duplexesor triplexes and putting people
that are family members on oneunit and being able to own that
totally.
So I love that and I thank youfor that example.
Speaker 1 (20:16):
Yeah, I think that that even goes to the fact of
you being willing to live withother family members.
It even makes it a little bitmore that you have your own
place.
It doesn't feel like, OK, well,they're literally in the room
next to me.
It gives them a little bit more,you know, ability to be on
their own, so I wanted to talk alittle bit more about some of
(20:37):
the critical partnerships thatwe can utilize for financial
literacy, and you did talk a lotabout HUD agencies already.
Are there other partnershipsthat loan officers should look
at?
Getting you know, invested intolearning more about that can
help within their communities.
Speaker 2 (20:54):
Yes.
So nonprofits, your localnonprofits.
You'd be surprised that some ofthe local nonprofits have
housing as a component of theirservices.
So I would say, tapping intothe nonprofits to be able to do
that because they're going totalk similar to the housing
(21:16):
agencies about budgeting, aboutcredit repair and things of that
nature but help navigate themthrough that process of
homeownership.
So, definitely your localnonprofits.
And then also reach out to yourlocal housing authorities,
right.
And housing agencies throughthe city, through the local
county government.
(21:36):
They have also been charteredto not only tap into down
payment and closing costassistance for you as a
first-time home buyer andclosing cost assistance for you
as a first-time homebuyer oreven to really help as a loan
officer for you to get educated.
But those are great resourcesto help you, as that loan
officer, have in your toolbox,in your arsenal, to be able to
(21:58):
say you know what, I can pointthat homebuyer in the right
direction, or how can I sit onmy local community board to be a
part of that initiative thatthat local nonprofit or that
housing agency and housingauthority is trying to push in
the community?
And then community reinvestmentagencies, right.
(22:20):
So the Community ReinvestmentAct was an act that basically
said, we're going to deal withthis issue of home ownership
across our nation, so localbanking institutions have to, as
a part of their charter, mustalso lend but also open up home
(22:41):
ownership to certain communities, and so that's where you're
going to see a lot of thoseproducts that are now geared
towards specific census tractsto really help that first-time
homebuyer.
So what I tell a loan officer isyou've got to understand in
your lending institution oranother lending institution
where those census tracts are,because those are opportunities
(23:04):
for you as a professional toshare valuable information and
to tap into those resources, andI also say your human resources
departments, for a lot ofmid-sized to large-level
businesses may or may not have,but may have a homeownership
benefit and component that youas a loan officer can tap into
(23:26):
and say hey, you know what Iwant to see, how I can do
possibly a lunch and learn.
I want to come out and make apresentation on maybe down
payment assistance or our loanproducts, because I understand
that there are a lot ofindividuals who may already own
their home that may become avictim to foreclosure, may
already own their home that maybecome a victim to foreclosure,
(23:47):
and I want to share informationon how we can help refinance
their home and help them, but Ialso want to share information
about down payment assistance.
So it's all I believe,stephanie, about really
connecting those pieces andfilling in those gaps, as that
loan officer, professional oreven real estate agent to be
able to say you know what, thisis, what we can offer.
(24:13):
This is how I want to be ofvalue a value agent, if you will
to that overall process ofhomeownership, and that's how I
think that we can effectivelychange communities by loan
officers, real estate agents,not just looking at it as a
transaction of the state agents,not just looking at it as a
transaction, but more looking atit as how you transform the
individual that you're workingwith.
Speaker 1 (24:32):
I think that that's so powerful for everybody, even
around that person, to be ableto do that.
We also are very passionateabout similar products and
bringing information to helpingthe loan officer better
understand.
How do I leverage it like, justlike you mentioned, a human
resource angle.
That's not a normal thoughtprocess.
That's like, oh no, I just Ijust talked to real estate
(24:54):
agents and then maybe I'mdiverse enough and I'm financial
advisors too, but again,there's so many different ways
to try to overcome thataffordability challenge.
I think that these are greatresources for that.
Love it, mark.
We're coming to the end of ourepisode here.
I just wanted to let you leaveus with a lasting comment,
(25:16):
because I have enjoyed thisconversation so much today,
anything that we can leave ouraudience with today.
Speaker 2 (25:23):
Thank you for that, and so what I will say is, for
the professionals that are outthere and those individuals that
are doing this day in and dayout, I salute you, I applaud the
work that you're doing.
I will say that you are reallyand I heard this the other day
the power behind the transaction, and also not looking at it as
(25:46):
a transaction that I mentioned,but also how we transform
individuals, transformcommunities.
I think you know the saying isrising tide right Lifts all
ships boats.
And so I say that because I'm afirm believer, over the years
that I've been doing this, thatthe most rewarding thing is to
(26:09):
work with a first-time homebuyerthat might be marginalized,
might not understand the overallprocess and the moment that
that light bulb turns on andthey get it, they follow the
steps to become a homeowner andthen they get the keys at the
end, and they still doesn't stopright there You're also talking
(26:30):
about now.
They're on the path to trulyunderstanding homeownership and
wealth building for theircommunity and wealth building
for themselves and how they arepart of their community, and so
I leave you with that, justremembering that you are really
the power behind the transactionand the better that we are of
getting great information outthere and realizing that people
(26:52):
do business with who they likeand trust no like and trust.
That's the easier part of allour business and it always comes
back.
I truly believe that.
So I thank you again for havingme on.
It was a pleasure and I lookforward to hearing from you all
again and seeing if we cancontinue to just push the
(27:14):
envelope a little bit more onhow we connect with our
homebuyers.
Speaker 1 (27:18):
Mark, thank you so much.
Speaker 2 (27:19):
Thank you for having me on.
Speaker 1 (27:21):
Thanks for listening.
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