Real Estate Show Lender Updates 2023 with Guy Giles and Beth Rodriguez

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Real Estate Show Lender Updates for 2023

Alice Lema: [00:00:00] Well, hey there, Southern Oregon. Welcome back to the Real Estate Show. So happy you could be with us today. I'm Alice Lema. I'm a local real estate broker with John L. Scott here in Southern Oregon, and today we have the great pleasure of welcoming Guy Giles and Beth Rodriguez of Mutual. Mortgage to bring us up to speed on all the latest from the Federal Reserve to the financial markets mortgages.

We had some interesting national job reports, which all affects home buying. So Beth Rodriguez and Guy Giles from Mutual Mortgage will be Joining us here in just a minute before we bring them in and find out the latest of the financial markets. Let's take a quick second and check with our local stats.

Now, here we are very early January, so we're not quite finished, compiling all the year end numbers from 2022, but we're very close and so I just wanna tell you which [00:01:00] direction the wind was blowing last year. So this is residential southern Oregon. We'll start with Jackson County. The year looks like 2022 year is gonna end with prices up in Jackson County, 4%. And the average price for residential is a whopping $506,800 is about where it's, it's headed. Now again, we're gonna have to give it another week or so just to let the numbers officially settle, but it looks like Jackson County is gonna end up with a 4% increase. Now, interestingly enough, Jackson County number of residential houses sold in 2022 is down 12%. So Jackson County down 12% number sold prices up. 4%. I bet that surprises you.

But wait, there's more. Josephine County prices look like they're gonna finish up 5% and check it out. The average [00:02:00] price in Josephine County for residential $461,880 looks like where that's gonna be settling down. But again, the number of residential homes sold in 2022 is down 11%, so very interesting. Josephine County number is down 11%, but the prices are up 5%.

And Klamath Falls prices are 8% to an average of $321,322, but their number sold is down 15% for residential in Klamath Falls. So Klamath falls up 8% for prices, but the number of houses sold is 15 percent from 2021. Very interesting numbers.

So let's bring in Guy Giles and Beth Rodriguez from Mutual Mortgage. We're gonna take a quick break, say thank you to our sponsors and we'll be right back.

Well, hey, Southern Oregon. [00:03:00] Welcome back to the Real Estate Show. I'm Alice Lema, your host of the show, Broker here in beautiful Southern Oregon with John Scott Real Estate.

And today we get to talk to Beth Rodriguez and Guy Giles again of Mutual Mortgage. They are our local in-house lenders. Welcome back guys.

Guy Giles: Hello. Hey, thanks. We're happy to be back. New year and everything. Ready to go. Yeah. Yeah. And so

Alice Lema: one of the things I wanted to ask about today is, There's lots of different kinds of approvals in lending, and I just wondered if you could maybe clarify and talk about what they are and what they mean.

Yes, absolutely. That's a big

Beth Rodrigues: question that's out there. What's the difference between a pre-qualification and a pre-approval? So just to differentiate between those, a pre-qualification. So a lot of the online lenders that you know, are well known, they, those are pre-qualifications. So what they're gonna do is they're [00:04:00] gonna.

You know, take the 10 0 3 year loan application and they're just gonna get your basic information, but they're not going to gather any documentation from you at that point to really follow up and make sure that that is a good true preapproval. So they're gonna just say, go off of basically what you stated on your application and say, okay, well based on your information you've given us, you are pre-qualified for this amount.

So a lot of people take that and. Think, oh, I'm pre-approved at X amount. Where actually that may not be the case because they haven't really seen that documentation. Then there may be some conflicting things, you know, which income was used, was it net or was it gross? And so that's sometimes a lot of things that the, the, the buyers maybe are not aware of.

So a, a good lender really truly is going to do what's called the pre-approval, meaning that we've not only taken your application, we've run your credit, but we've also [00:05:00] gathered the basic documentation which is, you know, your income assets, making sure, okay, this is really truly where you're at, so you have a lot better idea of what they truly are qualified for before they start looking. So, you know, the sad part is if they get that pre-qualification, they go out looking, they think they're qualified for this amount, and fall in love with the house and come back, and that's really not the case. And things can change drastically.

So that's really important, you know, to, to get a good lender that's really gonna take the time to get that pre-approval for you. And then, you know, some, even w you know, we could take it to the next step even and do a borrower or underwrite pre-approval where they have actually gone through underwriting with the property to be determined.

So maybe they haven't found a house yet, but you know, we can also do that and sometimes with a little bit more complicated income or that sort of thing. It's [00:06:00] good to be able to do that. So that's something that we do too. So that's your basic, main difference in a nutshell with a pre-qualified versus pre-approval.

Alice Lema: So, and I don't think people realize that this happens, you know? people consumers, buyers, they just don't always know especially when it's been a long time since they've purchased or it's their first time. They don't know how to decide if they have a, a lender who's really qualified them, pre-approved them, and then they go, like you said, Beth, and they go and write offers. And then what if the offer gets accepted and then five, 10 days, The buyer has to terminate the transaction cuz they weren't actually qualified.

Beth Rodrigues: Yeah. Everything just blows up.

Alice Lema: And they're just heartbroken. The seller's mad. Yeah. Yeah.

Guy Giles: So I've, I've actually seen good faith estimates from some of these out of, out-of-state lenders that they don't realize that we're gonna collect around 11 months of [00:07:00] taxes in an impound account.

So they just quoted, and so point you're thinking you're coming in. You know, you're down payment plus the closing costs and it could be thousands of dollars off because they just, they, they, they don't know what we collect here, so we, we've actually had people come to us and say, Hey, you know what? These guys are looking a little bit cheaper than you guys. Cuz we're very competitive on our rates and fees and mm-hmm. generally just not beat, especially from anyone around here. Yeah. And. And it's one of those things where it's like, I, I don't know why, but let us look at what they're talking about. And we see big mistakes in, in the escrows.

And, and by escrows, meaning your taxes or your insurance they might, you know, you might have a close date of the 15th of the month and they put down two days of interest at the end of the month. Well, really you're collecting 15, which could amount to hundreds of dollars there also. So there's, there's a lot of ways that, I don't know if it's intentional or not.

I'd like to think it's not. It's just ignorance. But where, where, you know, they, they, I don't know. I, I guess the biggest way [00:08:00] to explain it would be the what the big print give us a little print take us away. And, you know, we've seen that time and time again.

Beth Rodrigues: Yeah. And it's a true story that happened with one of my clients not too long ago that I closed. And I I kind of rescued their loan from an online lender and what that online lender did. Well, there was several things. There was three major things, but one of those was they were not aware of the FHA Jackson County loan limit. So they had their loan $7,500 over what it was, so,

Alice Lema: oh gosh. But see, and that's because they're not here.

Beth Rodrigues: Exactly. That client would've gotten to the signing table, or you know, hopefully it would've been before that, but all of a sudden, you know, that was just yet another thing. Oh, guess what? You have to bring in 7,500 extra. And so yeah, those are just things, like I said, maybe it's not intentional, but they just don't know so well.

Alice Lema: And it's also, I think the structure of those other entities, the online lenders like you said in the beginning, [00:09:00] Beth, they don't do a full evaluation of your financial life. They just do the bare minimum, which saves them money and saves them time. But this is why we wanted to talk about this today, so that our listening audience knows that when they're going out or they're helping their friends and family go out, that they know to ask that question.

Beth Rodrigues: Correct.

Alice Lema: And that's why it's not just that we want a local lender here in case we need to go talk to them. It's so that we know they're gonna actually go through the whole procedure upfront before you go writing offers.

Beth Rodrigues: Yeah, absolutely. It's really, truly, it comes down to basic data entry on one and then basic, we're actually, you know, just experts in that and really looking at all the fine tune details and knowing for our area as well.

Alice Lema: Yeah, and you know what else sellers. Should be looking at who the lender is when they're getting offers. Right, because they get burned as [00:10:00] well. Correct. By going off market with a buyer that's not Yeah.

Beth Rodrigues: It's true. That's what we're always happy when we get calls from the listing agents on one of our clients' offers and we're, you know, we just love that and that opportunity to really just reassure 'em, it's good, solid borrower, you know, we've done our due diligence, this is what we've done. And so it does, it does make a big difference for the sellers.

Alice Lema: Yeah. And Guy, you were talking about the difference in taxes that, because Jackson County is really quirky. It's hard to explain a lot of how Jackson County operates, but it's not just the insurance now it's the fire insurance. Right. Yeah. We've got like a lot going on with that. And how much is that gonna cost.

Guy Giles: There's yeah, there's been a lot of things up in the air. I remember a few years ago we went through it with flood insurance, when flood insurance was going to change for everybody and the people finally spoke up and this kind of happened with some of this fire that the was trying to come down from Salem [00:11:00] not that long ago.

Yeah. They're trying to re resurrect it. But you know, the, the reality is a lot of the area is in a high risk spot. So I know if I, I was an insurance person, I don't want to hear this and I definitely don't want to say it, but you know, if you live up there in a bunch of trees, which one of my properties is, I mean, it's definitely a lot more fire danger than, you know, out where, out where I live, where there's no trees at all.

So, I mean, You, you, it is something that some of that legwork that you definitely do want to try to do upfront, the best you can as far as getting some quotes from your, from your insurance agency. But the, the thing with the taxes, it's so weird around here that I, that we should dive into before we, you know, get too much into insurance, is that, About 20 years ago, I don't remember exactly when we voted in that they could only raise our property taxes by about 3% because that's really where a year inflation.

Yeah, so, so if you have a house that you really haven't done any work to, it's just been creeping up at 3% for the last [00:12:00] 15, 20 years. And so say you go in and you remodel your house and you spend $50,000 doing that, but you didn't pull a permit, that's not necessarily going to flag the tax people to where they're gonna raise your taxes up.

And then you have a person next door house in the same subdivision, built the same year, basically the same house, and this person did pull permits for his or her house. Maybe they only did $12,000. So if you do more than $10,000 worth of improvements and you turn all that in, Your house is gonna be reassessed, so you could have two houses next to each other, both updated.

One spent 70,000 updating it, and his taxes are actually lower than this other house that this guy spent, 12,000. Hopefully I'm not getting too deep into the weeds, but it's really important as you're shopping for a house, especially in. In southern Oregon and around Oregon where you, you look at the taxes because you could be in the same subdivision and have vastly different taxes on,

Alice Lema: and then you should ask [00:13:00] why, because it's a bad idea for people to be doing major improvements and not get a permit.

There's no happy ending to that? Not, no, not at the time. Not when you go to sell. Yeah. And then as a lender, how are you adding in the fire? Well when you're doing the pre-approval, cuz doesn't that affect people's pre-approval, their insurance?

Guy Giles: It, it, it does. And we, we just try to go the extra step and talk to insurance people when we can. And, you know, give, get a heads up and give them a property address and, you know, it makes it easier on them. A little bit faster during the process too, but. But we're, yeah, we're, we're, we're trying to have all these conversations, you know, with people because it is a, definitely a cost. We had one signing this morning with some flood insurance, and, you know, the guy was, loved the house enough, he was happy to pay for it, but it was one of those deals where, a deal killer for a lot of people.

When it comes, when it comes down to that and shopping for the right flood insurance and the right house insurance, you know, all [00:14:00] that, all that is part of the equation. Mm-hmm. . But, but yeah, we, we are trying to factor that in when we're talking to people. Cause the last thing we want to do is, , quote somebody a rate and quote somebody a, you know, rate is gonna change every day, but we, we try to be responsible about the taxes and insurance and say, you know, just, we gotta look at every house because it's gonna be, it's gonna be different.

Alice Lema: And that's time consuming. And not all the lenders wanna do that upfront. No. So that's why asking these questions before you pick a lender is super. I. Yeah, we're talking with, I was just gonna remind the audience we're talking to Guy Giles and Beth Rodriguez of Mutual Mortgage.

They are in-house lenders going back to the preapproval and the disasters, if you don't do all that work upfront, part of the reason some of the other lenders don't is because it costs something for the company to actually [00:15:00] do all that work, right?

Guy Giles: Yeah, I mean it's, it's, it's important for us because we're. Yeah, I've said it before my canned soup period, you know, but if I'm at Costco, I don't need somebody throwing a can of soup at me. Cause I didn't do 'em right on their loan . So we, we live here and work here and have friends here and, you know, I don't want, you know, I just, it, it is just, it's just the right thing to do to make sure they're going in when they make their offer and everything is done correctly. So, yeah. We have a, a bigger interest. We're not just fielding a thousand calls.

Alice Lema: Yeah. Yeah. Well, it's it makes a big difference on the smoothness of the transaction. And it doesn't matter if you're on the buyer or seller side. If you've got a lender that took the time to do all that, then you're not gonna have ugly surprises about the loan, in the middle.

Guy Giles: And that's why when somebody gets a phone call, you know, this just happened day before yesterday where Yeah,

Alice Lema: we're gonna have to take a quick break. If you've got a [00:16:00] good story, you're gonna have to hold that thought. Sorry.

Guy Giles: how about a mediocre story?

Alice Lema: we're talking to Guy Giles and Beth Rodriguez of Mutual Mortgage or in-house lenders. We'll be back in just a quick second after a word from our sponsors. Don't go.

Hey everybody. Welcome back to the Real Estate Show. So glad you could join us. We're in the middle of a really educational conversation with Beth Rodriguez and Guy Giles of Mutual Mortgage. They are a local lender. They're a sponsor of the show, which we appreciate very much, and they're just a wealth of information we've been talking about the difference between pre-approval and pre-qualification and the difference between local lenders and out of area lenders and kind of the ugly surprises that happen if the work isn't done upfront on the buyer's finances, can be big trouble in the middle of the escrow.

Guy Giles: Yeah. And, and, and it just comes from doing this for a while where you [00:17:00] get trusted from the real estate agents around town. What I was gonna say, I guess right before the break was we had some people coming down from Portland that were looking at houses and I called, called them Monday to check in, see how all the house hunting went. And they said, you know, they really fell in love with the house, but they were worried because, you know, they have to sell their house up in Portland.

And that's actually. It was nice cause I was able to call, I knew the listening agent really well and when I told her that I had pre-qualified these people, it I, it made the difference, and I haven't even told you yet, but it looks like we're gonna get the offer accepted. Oh, that's wonderful. We're the contingency.

And that actually kind of goes into a lot of the fears that are right now as far as people, you know, with rates going up and with some different things. I mean, this market has shifted a lot. And I just remember you know, somebody coming in and, and being pre-qualified at a certain amount and they find a house at that amount.

And I'm thinking to myself, they're never gonna get it [00:18:00] because this is a good house. There's gonna be six people bidding for it. It's gonna end up going over what it was.

Alice Lema: And You mean in the market we just came out of? Not the market we're in right now.

Guy Giles: Oh yeah. And, and, and I guess I'm saying it to say that a lot of people thought, what's into the world? You know, rates went up a little bit or, you know, something happened. And there's actually been some shifts that have actually helped as far as being, being a buyer. Yeah. They might accept a contingency at this point. You're not shuffling to where you had to have your house sold before. You're not going in 20, $30,000 over.

You're actually maybe getting some of those people to buy down your rate partially, and just something that was in this guy's mind from the other, from Monday, where he was thinking, well, I'm never gonna get it because I have, you know, I have to sell a house. You know, it's, it, it, it's kind of nice being a little bit in, in control rather than the sellers just being the ones in control like they have been for years now.

Alice Lema: Yeah. It, it's a, a more neutral [00:19:00] market is more welcoming to everybody and people can make better choices cuz they have time. Yeah. And they won't overpay. . Yes. That's very good. Yeah. You don't have to throw two more bags of money on the porch .

Guy Giles: We, we actually had a talk, I don't remember who it was with this morning, and they were talking about, I guess it was it was at our closing this morning where people were talking about they think the markets are gonna crash.

They're waiting for the crash, they're waiting for houses to go down. And I had Brad Bennington in my office yesterday and we were talking, he's head of the home builders and all the houses that they lost over there in Phoenix and Talent, you know, those haven't been replaced yet. And we were kind of behind as far as having enough houses for everybody, even, you know, before all this stuff happened. So I, I think if people are waiting for big crashes, you know, it's, it's just, it's not gonna go up as fast. I really don't think that we're gonna have a big reduction in, in [00:20:00] prices around here. It might feel like it because everybody had been listing their houses for more than they were worth and they were getting it.

So why not do that? But then we're just ended up landing on, on a realistic place. So it's it's not bad though if, if you're thinking about this to be looking right now, cuz the last thing you want to do is get too far into spring when the sellers feel like they're a little bit more in control and this might be the time to get your

Alice Lema: well, they're more hopeful. , they're in the hopeful stage.

Guy Giles: That's true. We don't deal with that side as much as you do. Yeah.

Alice Lema: So you know the other thing about the market right now that I think is a positive that's getting overlooked or maybe just not brought up as much, is that we have the perfect storm for the buyer.

We have more houses than we did the market's prices are not going up. They're stabilizing or going down a little bit. And because of [00:21:00] the chaos in the world, the sellers are a little ,I don't know what the word would be, but the sellers are more cooperative. And so, and the rates are down. Right. They're not seven and a half, they're, they're like, what in the high fives, low sixes.

Guy Giles: Well, it, it's, it's gonna depend you, you're, you're buying your rate at that point. We had another 1.4 trillion spending that happened and you know, you know me, I never get political, so I won't go too deep into that.

Alice Lema: But we do need to talk about that because that's counter to the Fed's inflation reduction strategy. Yeah. Right. So that's a good thing to bring up. If the government is still spending lots of money and creating inflation, what's that gonna do to the Fed's decision about mortgage rates, do you think?

Guy Giles: Well, it's it's like, it's like half of 'em are smoking [00:22:00] weed and the other half are on crack to be honest. I mean, just trying to, trying to decipher what these guys think and the moves that they do that are just completely counter to what their mandate is. You know, we, we ended up putting over $5 trillion into the economy and yeah, it might have created a job or two for a little while, but it created inflation.

And, and, you know these are cycles. We've been in inflation before, but they're just. I don't know. I, I think they're finally doing the right things to keep it under control. That doesn't necessarily mean that they're lockstep with the people that have the purse strings that, that wrote that other 1.4 trillion budget last week.

So, you know I, unless we can talk these guys into just doing what's right for the country rather than what's right for an election or what's right for, for the next 20 minutes I, I honestly, I'm a little bit at a loss. You know, what's gonna need to [00:23:00] happen is rates are gonna need to stay up.

At least we're talking about the, we're talking about the, the rates that, the Fed is in control of. You know, that they've been raising up three quarters of a point, half a point. You know, whenever, whenever they meet lately, you know, that's probably gonna stay up for a little while. We have seen some easing in Germany around the world.

As far as, as some inflation numbers that we're, that we're looking at, you know? There's jobs, reports, all kinds of things this weekend, and some of 'em contradict each other. Sometimes they, you know, I, I think overall that, that they're looking more in the rear view mirror than they're looking ahead and they're not really realizing that the inflation is softening a little bit.

And, and it's just, it just has to do with overall, you know, going into a recession more than you know, I think that's gonna overtake the, some of the spending that they've done. And, I feel like I'm talking outta two sides of my mouth, but there's like, [00:24:00] there's like these, yeah, there, there's, there's so many things.

You know, one thing helps us as far as rates, one thing hurts us as far as inflation and just, just everything has consequences. But I don't see the fed lowering, you know, Stuff anytime soon. Once they feel like they get a handle on it, you know, I do feel they'll probably do more quantitative easing like they did before.

Oh, where they're putting mo I, I know putting money into, you know, artificially holding the rates down. That's something they had to pull out of so that they'd have some sort of a gun or a bullet backing their gun. So. How soon? I don't know. You know, I think people are still really, they believe that, you know, rates will be down, you know, firmly closer to 5%, you know, without, without, you know, paying a bunch in points.

You know, sometime first quarter, second quarter of this year, we were starting to see some really good moves until,

Alice Lema: well, that would rock. Yeah, I was thinking it would be more like, [00:25:00] 2024 because depending on how you look at it, I mean, we had a really good strong jobs report this week, which I was kind of surprised because there's, a kind of a movement through the employment sector that, that people, a lot of people are getting laid off.

So when the job report came out in, I can't remember exactly what it was cuz it was last. Wednesday or Thursday. But you know, that's how home buyers, that's how we know if people are gonna be able to buy homes. Right. Because we're looking at employment numbers.

Guy Giles: Yes. Yeah. I mean, I. That's one of those ones you end up looking in the rearview mirror for, because they usually revise the job numbers you know.

Alice Lema: But by the time, so don't, don't be fooled by that. Is that what you're saying? Yeah. Don't be fooled by that.

Guy Giles: You know, they, yeah. You know, it's like, it makes people feel good for a minute and then, and by the time. They're just hoping by the time that they send out the real numbers that [00:26:00] something else will make people happy I guess. I don't mean to be all negative, I mean, honestly.

Alice Lema: Oh, no, no, no. But it's kind of a negative situation we have out there. Right. So I think it's great that we're talking about it.

Guy Giles: Yeah. You know, we, we need to, I just, I, I hope that the powers to be, you know, hear it at some level that, that, you know, we, we do need some stability, you know, the Republicans taking over the house that's gonna add a little bit of gridlock into the government. And markets like that, you know, just because you don't have one side either side,

Alice Lema: but markets like that, that's what you're saying, that that's a positive to the financial world? Yeah.

Guy Giles: Yeah, they do. And maybe, maybe, maybe, you know they'll get a little bit of a handle on the purse strings and, you know, like, like I said, I've don't like either of them. I'm just, you know, I'm unaffiliated by, I really don't have any use for any politicians at this point, but, maybe we'll get a little bit [00:27:00] of relief as far as some of the spending goes. And, you know, so that, that is my hope. And you know, I, I do think that the inflation will ease as long as, you know, I could be completely wrong if we come up and, and they say, oh, we just stimulated a bunch more.

We'd spend a bunch more money that we don't have. But beyond that, These are very predictable. They have been for years, and, and we should see some lower rates really soon.

Alice Lema: Yeah. Well that's, that is so encouraging. So once again when the rates go down, sometimes the prices can go up because of the lending limits. And you were gonna talk a little bit about. Some of the lending limits. I don't, I don't know that people quite understand that every area has like a threshold. Yeah.

Beth Rodrigues: On the lighter note they increased loan limits.

Alice Lema: Yeah. It, it means you can, yeah. Why don't you tell people what [00:28:00] that is and what it means.

Beth Rodrigues: Yeah. So for, I'll tell you the limits and then Guy can tell you a little bit what that means. But for the conforming loan limit, they have bumped that up for Jackson County to $726,200. And then FHA is at $472,030. So on the FHA that would mean that you could qualify for up to a purchase price of $489,120.

Alice Lema: Wow. That's quite a lot, don't you?

Beth Rodrigues: Yeah, it's a big, it's a nice jump.

Guy Giles: It it, it is and it helps a lot of those people that, that might have a lower credit score. You know, we, we might put somebody into an FHA loan for a little while. You know, I'm not a big guy to churn loans. You know, I've, I've always tried to get people into the right loan the first time.

Yeah. But it might not be a bad idea if you have some credit challenges or, we need to go with a little bit higher debt to income ratios to look at that, because the mortgage insurance is capped on that. The rates are a little lower on those. And if, if it's something that, you know, we [00:29:00] gotta try to work on your credit for a little bit. But you want the house now? We, we can, we can look at some options there. We can probably talk about that after the break a little bit.

Alice Lema: Yeah, that's great. We're talking to Guy Giles and Beth Rodriguez of Mutual Mortgage, our in-house lenders. We're thankfully brought to you by Mutual Mortgage. We appreciate you so much John L Scott Ashland, Medford and our local Rogue Valley Association of Realtors will be right back. Do not touch that dial.

Well, hey, there Southern Oregon. Welcome back to the Real Estate Show. I'm Alice Lema, and I wanna just remind you that this broadcast will be repeated tomorrow on Sunday at 6:00 PM on K C M X FM 99.5. And just another reminder that KC M X is no longer on AM eight 80. It's all on the FM transmitter now, and the sound is great. So welcome. Beth and Guy, we're so glad to have you.

Guy Giles: Thanks. Thank you for having us. [00:30:00] Yeah. Another year.

Alice Lema: So yeah. Yeah. Looking forward to it. And so we were talking before the break about loan limits and how fat and juicy the new loan limits are, and we're all kind of surprised about how fat and juicy they are.

It, it really does cover

Guy Giles: a lot when you're looking at conforming or conventional loan limits being up to $726,200.

Alice Lema: And that's Jackson County, right?

Guy Giles: Yeah. And, and so there are, what I mean that is kind of the conforming loan limit for the country. They have what are called high cost areas in San Francisco, seattle, maybe Portland, some places like that. It's a different rate, even though they say that it's still a conforming loan. And by that we mean loans that the, the GSEs or the government-sponsored entities, Fannie Mae and Freddie Mac are allowed to purchase. So that's really just a difference in that. And what maybe a Chase Bank or a Mutual Omaha or somebody would put on their own books, meaning like a, a jumbo [00:31:00] loan or a, you know, a non-conforming loan so that that's, fannie Mae and Freddie Mac probably own 90% of, at least 90% of the loans. I don't have the exact figure, but that that's what they set their, their loan limits to as far as how much they're able to, to loan on the house. So that's gonna be most of your loans.

And around here with our purchase prices, yeah, there's some more expensive pro programs. But you figure 726,000, then you have your down payment on top of that, you know, you're going up to 850, $900,000 and still you're in a conforming, in a conforming area.

Alice Lema: And is this in re reaction to the prices going up that the the, the loan limits were raised so that people could still purchase.

Guy Giles: Yeah. And then, and they, they, they seem to just kind of go up every year. They don't usually announce it till around the middle of December or something. But yeah I remember when I got in the business and, and when they went up to [00:32:00] $417,000, I thought, oh my gosh, man, I, and so I, you know, you could see that wasn't that long ago. Doesn't feel like it, it wasn't that long ago. So, yeah, it's.

Alice Lema: So can I ask you a opposite question? Do the lending limits go down during a decline, like during the crash? Do the lending limits go down?

Guy Giles: I have not seen them go down.

Alice Lema: So they don't go the other way. They just go up. Yeah. They, you know, that's, that's interesting.

Guy Giles: But it's also, it's also a function of, you know, when we talk about, you know, you go out and you buy a motor home. That that asset is going, you know, you know, in a certain amount of years that that's gonna depreciate. You know, and that could depend on markets and if they're available or not, but that just is an overall sign that buying a house is in the long run. You know, if you're not trying to just make a buck in 12 months, that it's a good, it's a good investment to buy.

Alice Lema: See, and that's the other thing nobody's talking about right now. I still say this is such a good time to buy or [00:33:00] sell. It really is. There's still buyers out there. We still have a housing shortage, and if you're a renter then stabilizing your housing expense every month is super important. Super, super important.

Guy Giles: Especially in an inflationary market when they're, you're able to raise their rents depending on what the inflation was for rent.

Alice Lema: Well, and this year, you know what? In Oregon, you can go to 14 point a 5% rent increase. That's gonna blow a lot of people out of the water. I don't know how many landlords are actually gonna do that, but 14 and a half percent.

Beth Rodrigues: Yeah. Also a big issue we've seen, so we've had so many clients that have contacted us for loan pre-approval because their landlords are selling. I mean, I can't tell you how many, it's been just last year where Yeah, 90 days to get out and it's, it's hard place it puts them into.

Guy Giles: And another thing that we're seeing more and more of, and it was another one today, we haven't even talked to the person yet. [00:34:00] It happened literally right as we were coming on, on the air. They want to have a couple of generations in the family and they're going to go in on a house, you know, and they're, they're going up to, I think maybe 1.3 million.

So it's gonna be, you know, it's not like they're all shoved into an apartment or something. but you know, the, the biggest thing that we see is people wanting to get closer to family. And if you have family that's aging maybe and you don't hate 'em, it might not be a bad one.

Alice Lema: You don't hate 'em. , you know that's important. Well that is, it's funny cuz that's actually part of the conversation when these multi-generational families are going through houses, it's like, you know, they're actually calculating the arms distance.

Beth Rodrigues: Oh, that's funny. . Yeah, that's end of. This is ours. It's the thing.

Alice Lema: It's like, am I gonna come out of this room and see you then? Yeah. It's, it's pretty funny. But it's also, I think a great a great use of blending people's family resources and [00:35:00] getting a nice, big property that yeah, will be super valuable later.

Guy Giles: Well, yeah, and, and just, you know, just face it as you get older, you might need a little bit of help from the kiddos and if you can do it under one roof, I think it might be a little bit better, maybe even help out babysitting the little ones.

Alice Lema: You know, it used to be like that. Yeah, it used to be like that. That's, that's how we used to roll. And then everybody's separated and now we're all coming back. So I don't think that's a bad thing. And yeah. And you know, it's a buyer's market in those upper price ranges in southern Oregon.

Anything like over seven or 800, it's, there's a lot of choices and they're not selling very quickly. So you can really make some good deals if you wanna be, you know, in that kind of a property.

Guy Giles: Yeah. We're that, that one from earlier this week was a big one like that too. That's right around just under a million dollars.

Alice Lema: Mm-hmm. and so did they get the house?

Guy Giles: I, I'm pretty sure I've been talking to the agents, but it's not formal [00:36:00] yet, but I, know they're excited and his, I don't know if I'm allowed to say it or not, but his wife's coming. She's gonna be running.

Alice Lema: Yeah. You can tell that story next week. If talk to them first. Sorry, . We don't have a bleep here. We just have you going. Whoa, stop. So but you know, the the number of people still moving into Southern Oregon is quite quite high. How, how's your relocation business going?

Guy Giles: Well, the one, actually, the two that we talked about today on the show were both people relocating here.

Alice Lema: Oh, is that right?

Guy Giles: So, yeah. So it is, it is still happening for sure. I mean, it doesn't feel like it was before, but it's, nothing feels like it was before, you know? And there was five, six things happening every day that were brand new and it felt like everybody was moving here, but yeah. If you really look at our, if you look at our statistics, absolutely.

People are still coming next week. [00:37:00] They're relocating.

Alice Lema: Well, and I I, do you also get a sense that people are more ready to make a decision for some reason in January? It just seems like we have a lot more decisiveness than we did in even November.

Beth Rodrigues: I think so, yeah. I think definitely the new year. There's something about it where people are just, they're kind of ready and they're like, okay, new Year, let's go make that decision. No more on the fence. And I think you do see that. Yeah. Yeah.

Alice Lema: Well, we only have about 30 seconds left. If somebody wants to get ahold of you guys, how do they do that?

Guy Giles: Well, my cell phone number is (541) 944-6987. You can call Beth also the, either, either phone number will get to us. You can look us up, Google us.

Anyway, we're trying to throw some videos up on our on our Facebook page to just kind of educate people also. So that's someplace you can try to look us up also.

Alice Lema: [00:38:00] Great. Well thanks so much for being on the show. We're gonna have you back again soon. Beth Rodriguez, sky, Giles Mutual Mortgage. Thanks so much.

Have a beautiful weekend everybody. Bye now.

Beth Rodrigues: Bye. Thank you.