Southern Oregon Real Estate Show - Lender Update Guy Giles

Full Video Transcript Below

[00:00:00] Alice Lema: Well, top of the morning, everyone. Welcome to the real estate show. I'm Alice Lema. I'll be your host today. I'm a broker here in Southern Oregon with John L. Scott real estate. And we have an absolutely fabulous show for you in front of us. We've got Mr. Guy Giles, Ms. Joel Omaha mortgage. He's going to be our guest today, bringing the monthly update on lending. The federal reserve bank spoke this week. He's going to bring us up to speed on, on all that. He also has some special programs for heroes and also small businesses. We're also going to talk a little bit about why the market is leveling and not crashing. So lots and lots of interesting things.

[00:00:50] You're just thoroughly enjoy the conversation with Guy Giles. So make sure you stay tuned for that. For a little bit of our market update, we still are in what we're calling a transition market. We're starting to get a few more listings on every week in all of the price ranges, the upper price ranges are still a bonafide buyer's market.

[00:01:11] So if you wanted that bigger property, that bigger house, maybe you're moving in with your relatives. Maybe your relatives are moving in with you. That 800 mark 700 mark, $750,000 or $800,000 bonified buyer's market. Those price ranges on up, and lots of properties to choose from. And those lower interest rates, even though they're edging up ever so slightly, still the monthly payments are more affordable than they have been for decades.

[00:01:41] So definitely good pickings in those higher price points, but we're also so happy to see some more inventory coming in the lower, lower price points I watched old east Medford, Central Point, West Medford offered this week, Grants Pass, Klamath. We're starting to get a few more of those cottages on the market.

[00:01:59] The only thing is so a lot of those cottages have tenants in them and you know, in the state of Oregon, we have very special procedures for dealing with tenants that are staying in properties when they go on the market. So if you're hunting in those price ranges, you're an investor, first time home buyer, then just be prepared and know the rules and your agent will educate you.

[00:02:21] But you can finally have a few more choices, which is wonderful. And that's also another signal to a lot of us that the transition is continuing as the new listing start filtering down to lower price points. So yay for us. And thank you to all those sellers that put their properties on the market this week.

[00:02:40] We're looking forward to quite a few more listings coming in the next four to eight weeks. And normally in Southern Oregon, we're a little more seasonal things. You know, kind of quiet down in the fall and winter, but we have a backlog of sellers from the COVID and the fires. And we have lots and lots of new properties coming on the market. So have lots to talk about today. Do not touch that dial. We'll be right back.

[00:03:06] Well, good morning again, everybody. And welcome back to the real estate show. I'm Alice Lema. I am your host for today. I'm a real estate broker at John L. Scott here in Southern Oregon. And today we have our monthly update from Guy Giles Mutual of Omaha mortgage.

[00:03:20] So excited to have you back Guy. Tell us what's been going on.

[00:03:25] Guy Giles: Well, it felt like it slowed down for a few minutes and now I think maybe that's over it. All of a sudden, I, I can't work enough hours, so you know, it's good. You know, you kind of wait for those little breaks and you think man, I'm going to rest when you get there.

[00:03:42] And then as soon as you're there, it's kind of like, wow, am I ever going to do another loan? So you start, you know, making some phone calls and then next thing you know, you're just like, why didn't I just rest for a week? It wasn't that busy. I have again, and with me, if there's not a lot of contracts, then you're getting people just kind of pre-qualified and then all of a sudden, then they all pop in at one time.

[00:04:05] And that's kind of the phase that I'm in right now. Everybody's finding houses and I was actually just kind of preparing a couple of campaigns to go out with for some, for our heroes program for firefighters. And you know as far as I'm concerned, I made a separate program for small business people just because as far as I'm concerned, those guys just surviving everything that happened, guys and gals, I should say.

[00:04:31] Well, yeah, look, I just, I'm pretty much surrounded by women that run businesses very, very well. And if I didn't have some helping me, I would be basically on the street right now.

[00:04:42] Alice Lema: And the small business is really the heart of our economy in a lot of respects. And I think he made a good point. It's been brutal the last 18 months on those folks. And it's, it's great to hear that they made it through and they're able to call you and you can work with them and help them buy properties.

[00:05:02] Guy Giles: Yeah. We actually have a couple of different programs for, for small, for small business owners or people that might not show as much on their taxes.

[00:05:10] We have some bank statement loans, and if you've been in business for five years, we can just look at your bank statements from last year. And yeah both on investment properties, if the property pencils out, we really don't scrutinize a loan a whole lot more. I know that sounds horrible. Like, Hey, let's go back to 2010 and let everything crash.

[00:05:33] If the property does not stand on its own, it's not something that we do. So as long as those numbers pencil out on, on that, we can get you into an investment property. And it also one of the recent rule changes was that if you don't own a primary residence, you can't buy an investment property.

[00:05:50] Alice Lema: It's different from, I mean, people keep thinking there's a crash coming and it's like, the rules are different. And what you're talking about is leniency, but it's not frivolous lending.

[00:06:00] Guy Giles: I don't. I mean, honestly, I don't know of any programs right now that are gonna, that are gonna crash this thing. I mean, now if you fire a bunch of people and you know, for, for mandates, and if somebody really has a, you know, it doesn't want to get a vaccine or something, you lose your job.

[00:06:17] I mean, there's no control over that, obviously, but as far as, as lending goes, we have not really made any dumb decisions since, since the crash. I mean, yeah.

[00:06:31] And just for the record, I was around two very, very smart women at that point. And they instructed me not to sell those option arm loans. And consequently, I didn't. I only had two people foreclosed that I knew of through that whole crash. They look me in the eye and said, look, you can make a lot of money on these.

[00:06:48] But well we've been in the business for awhile and they are not a good thing to sell. And you know what? I did lose a lot of money, not selling those things, but I didn't have people coming back to me because they crashed. Yeah. I had other people's people come back to me cause they crashed and I still had to fix it, but you know, and try to try to help those people.

[00:07:05] But I think we've, we've worked our way a long time ago through, through all of that. And we're just, we're loaning, you know, making good loans when we have so, but, but there is really nice stuff. Like I said, for self-employed people or people that want to get into the investment market, we, we tightened up for a while where they would only allow 7% of our portfolio.

[00:07:27] I say "they" Fannie Mae and Freddie Mac would only allow 7% of our portfolio to be investment properties or second homes. They've since kind of let off on that. So so things are a little bit more back to normal when it comes to those programs. That was that, that was tight for a little while. Cause a lot of people buy second homes here and eventually retire. So so we've got some relief there. Gosh. Well, what else?

[00:07:51] Alice Lema: I mean, we haven't talked to you for a month and now we're just starting November. So, and the market is still, you know, moving at a good pace and it sounds like you're busier than all get out.

[00:08:05] Guy Giles: Yeah. I mean, I'm not going to say I was where I was, you know, five months ago, but it could get that way really easy with the amount of pre-qualifications coming in.

[00:08:14] And again, that's just kind of where it starts. My kids grew up in a neighborhood up in East Medford, and I had this four mile loop that I walked every night. Yeah. I'm that old dude that you just see walking every night with this dog, but this time of the year, it's beautiful with the trees.

[00:08:28] And I walked it last week and I saw a lot of signs for houses. And I thought out, here we go. And then a couple of days later, I grabbed my wife after church and we took that walk and three of the houses were pending that were, that were on that little loop. So so yeah, definitely things are moving. We're seeing that it was a little bit of a scare for a minute. And you know, but I think everything is just kind of going to settle in the people that have had jobs, you know, have still have them. And they can actually command a little bit more for what they do for a living. So who knows?

[00:09:01] Alice Lema: Yeah. There's a lot of that going on. People are shifting into other jobs, making a lot more money and that's where it starts. If your income goes up, your purchasing ability goes up. Whether it's houses, cars, boats, whatever.

[00:09:15] Guy Giles: That's nice. I mean, I think there was probably a little bit of weird fake stuff. You know, every time they just infused the whole country with money, of course, you're going to get some commerce and you're going to get some things. And I think the fed is finally at a point right now where, where, you know, they're saying, they're going to taper off some of the mortgage backed securities.

[00:09:33] And that, that has caused a little bit of fear when it comes to mortgage rates, because obviously, you know, that kind of undoes your raise. But I really don't think that it's going to affect it. Like some people do because they're their portfolio that they have right now they're not getting rid of that.

[00:09:52] They're tapering off the, some of the new stuff that they're buying. So the majority of it over 80% of it is not going anywhere and they will keep reinvesting in those mortgage backed securities and that's going to help keep rates down.

[00:10:04] Alice Lema: That's a very, very good point.

[00:10:07] Guy Giles: Yeah. So it's, it's, it's not as dire as, as, as a lot of people will, will make you think. Will, rates go up a little bit, you know, probably in the near future, not, not a ton. But I, I thought about that just for a second before the show. And I did some really quick crude, crude math on that. You know, if you're buying a $500,000 house, do you, I mean, realistically, a $400,000 loan is not out of line right now.

[00:10:34] It's just, it's, it's probably a little high for an average, but it's pretty typical for the things that I'm seeing lately. Your payment would go up about $110 a month and that sounds like, yeah. So, I mean, it's. not end of the world stuff. And I'm not saying we're going up a half a percent, but I just kind of wanted to, you know, break it down, down into some kind of a number that would, you know, make some sense.

[00:11:00] Over the life of the loan, say you're at 3% at a $400,000 house, you're going to pay 600, $600,000 back. I mean, that's the ugly number. That's the reality of this thing? You know, you're borrowing $400,000. You're paying 600 back, you think, oh my gosh.

[00:11:16] Alice Lema: Over 30 years though. Right?

[00:11:18] Guy Giles: Yeah. And, and so if you're, if you're a half a percent higher, you know, you'll, you'll pay you know, say $40,000 more, but at the end of that, at the end of that time, you know, you have a house.

[00:11:30] I also did an appreciation at about a quarter of what we appreciated last year, because obviously that is not sustainable, you know, kind of more of an average. 4.3 is what, what I've always just kind of seen. You have a $1.8 million house. So instead of buying somebody else's rent and, you know, buying paying for their mortgage, if you can get into a house, you know, it's not your dream house right now. If it's into something, just getting in the game.

[00:11:56] My first one was a single-wide that we used to decorate with putting a plant on the tongue and. You know and but I made money on that property, believe it or not. Cause it was actually attached to some land. And you know, at the end of all that, like I said, you're going to pay rent anyway, you're going to have rate increases historically they've been about 6% per year. And now you have a $1.8 million piece of property at the end of it.

[00:12:21] And you know, in my case, the second house that I bought, I just still have that. I paid $137,000 for that. Easily sell for 480 right now.

[00:12:32] Alice Lema: But I want to stop you right there. Cause back then, I mean, it sounds like a very little amount right now, but back then, weren't you stressed about how am I going to make the payment?

[00:12:41] Is it going to appraise? I mean the mindset it's like you hear these numbers, you think, well, back then that was a bucket of money, right?

[00:12:49] Guy Giles: Oh my gosh. Yeah. That's the same conversation. When I sit with people and I definitely try to have some sort of a meeting with, with first-time home buyers. And it's a little more difficult to see through a mask, but I can tell what's going on with their eyes and fear, fear, no matter what.

[00:13:07] Alice Lema: But they're worried about the big numbers. And I like what you're saying is that don't let the big number, don't let 400 scare you. Drill down and find out what that's really going to mean to your monthly budget. That's where it counts.

[00:13:20] Guy Giles: Absolutely. I mean, you know, and there's other, there's other things that at least for the time being, and it looks like they're not getting rid of it anytime soon, you still have interests that you can write off.

[00:13:29] And if you're under a certain income bracket, you could still write off your mortgage insurance and you know what I mean? So, so other than the, just the sheer appreciation of a house, you know, when you, when you look at the whole thing and you factor in those tax write-offs too, and that's probably the difference.

[00:13:48] So, you know what I mean? I, I usually try not to lead with those things with people. Cause you know, they're excited and wanting to buy a house and I really want to talk to them about real numbers, but by the time I'm done meeting with them, I do have those conversations. It's it's a nice thing. When you get your tax bill in the mail.

[00:14:05] I mean, that's not a nice thing they're generally paid for, you know, by the time you get done. But when you get to write that off on your taxes, You know, it, it all adds up to your bottom line at the end of the year.

[00:14:17] Alice Lema: It really does. What I tell people is you could just make it through that first year. And that first year is frequently a struggle, whether it's a hundred thousand, because that's where the market is or 400,000.

[00:14:26] Cause that's where the market is, it's that payment. And it takes a whole year to get used to it. And then you get your taxes and then you start getting raises your jobs, get better. And then, you know, then it's like you sitting here all those years later going look what I did when, and I still have the house.

[00:14:41] Guy Giles: Well, yeah, and, and I don't regret it any property that I bought and I didn't try to buy it and sell it in four months, you know? So I've been pretty lucky there. I never got into that thing but absolutely. You know, it's just a part of your, part of your portfolio, you know? The stock market has been going crazy and people have been making very good money in that.

[00:15:04] I'm not suggesting pull money out of the stock market to buy a house or something you can borrow against your 401k, if you, if you want to, as you pay interest back to yourself. So you know that there are some ways to get some money to buy a house, but, but it's just, if you're not, well-rounded like you could be, if you don't have this, at least as part of your portfolio.

[00:15:26] Alice Lema: Yeah, your financial security should include some real estate.

[00:15:28] Guy Giles: And the only thing, you know, one of my little things that he came up with, he's only thing that sucks worse than mowing your lawn is mowing and someone else's lawn.

[00:15:39] Alice Lema: Okay. Well, hold that thought Guy, Giles, Mutual of Omaha home mortgage. One of our sponsors. We've got to take a quick break here. We're brought to you by Guy Giles ,mutual of Omaha mortgage, John L. Scott of Southern Oregon, and our local Rogue Valley Association of Realtors. I'm Alice Lema broker, John L. Scott. We'll be back with you right after these messages do not touch that dial.

[00:16:02] Well, welcome back folks to the real estate show. I'm Alice Lema, broker John L. Scott. We're here having our monthly update with Guy Giles and Mutual Omaha mortgage. And one of the things you mentioned early on in the last segment Guy, was the heroes program and the small business. Let's circle back and talk more about that. Cause that sounded really interesting.

[00:16:26] Guy Giles: Part of part of how we could buffer ourselves, I guess, for lack of a better word from, you know, the, the rates going up a little bit. And by the way, I do not think there's any appetite for them to go through the roof. I think they'll probably continue to bump up a little bit, but the, economy's not cured yet.

[00:16:44] And I really do believe that that there's an appetite to keep them low. And even, even though they'll bump up a little bit, they have bumped up a little bit from their very, very bottom. They're not going to go crazy. And I do anticipate a little bit of relief as far as the rates go, because it's just a huge part of our economy right now.

[00:17:05] And it's actually the one light that's, that's actually shining still, you know, pretty bright.

[00:17:11] Alice Lema: The housing market is pulling us out. Yeah.

[00:17:15] Guy Giles: So on these programs that I'm doing for small business and for heroes and I'm including union members in that also, you know there's just a ton. I was in a union for years.

[00:17:26] We're basically giving a half a percent, and I know that may, that may not translate to anything for a lot of people, but it's basically, you can take the word point and put percent in there. So it's a half percent of the loan amount. So on a $400,000 loan amount, you have basically 200,000, $2,000 to work with not 200,000.

[00:17:50] So we can buy down your rate with that. We could give you lower closing costs with wipe out appraisal fees. You know a lot of times we're able to get them to where those things are waived these days. Anyway but we could, if we can get you a quarter point lower rate by buying down the rate with that, or an eighth of a percent rate, that absorbs, you know, half of that, that money that you'd be dealing with with the higher rates.

[00:18:13] Anyway. So it's not a great way to explain it so far, but it actually, there is a, there is a big benefit and, you know, if you're out shopping it at one of the local places that doesn't have one of these programs, you know, it doesn't take, but five minutes to talk to me and I can line you out. And if, if I'm truly not better, which I would be very, very shocked.

[00:18:35] You know I'll send you on your way and you'll know that you at least did your due diligence when it, comes to this.

[00:18:40] Alice Lema: Now this is a program called heroes and it's for teachers, police, fire. Yeah, medical worker.

[00:18:50] Guy Giles: Yeah. Yeah. And you know, if, if you're out there and you're a tech working in the hospital, as far as I'm concerned, you know, the way we've structured this program, you're included on it because you're, you're still out there. You're still on the front lines. You're still, you know, you work through this whole thing when a whole lot of people didn't. And so if you're anywhere you know the dispatch operator, you know, I mean, I really want this at least loose while we can kind of, for everybody that's just out there working and to protect us when we're asleep.

[00:19:24] Alice Lema: And these are programs for those folks. And then the veterans associate veterans program is separate. Correct?

[00:19:32] Guy Giles: Yeah. I don't charge any bank fees to veterans at all. Yeah. I haven't for a long, long time. They decided they wanted to try to go lower rates and charge a little bit of those for awhile.

[00:19:45] That lasted a very, very short time. So I've really with this company, never charged veteran's bank fees. And we actually, for every VA loan, we close, we, we do donate money back. I don't usually like to talk about that kind of stuff. But as a company, we do donate back to the wounded heroes to a whole bunch of different organizations.

[00:20:04] So yeah. And I don't know of anybody though can beat our VA stuff, either just, just rates. And then you throw on top of that, but you're not paying you know,in a lot of cases, 17, $1,800 in bank fees. You know, for that it's, it's actually, nobody's going to get close to me on, on those either around here.

[00:20:23] Alice Lema: And in a different market, sometimes we can get the seller to contribute to that. But you know, depending on how hard you're having to arm wrestle people for a house, it's really great that, you know, as a lender, that's not even going on the books.

[00:20:41] Guy Giles: I am starting to see a little bit of relief when it comes to, you know, the sellers aren't making you come over and mow their lawn for the next three years.

[00:20:50] Alice Lema: But you know during the height of the, of all this frenzy during the shut down, we had a bunch of sellers that negotiated yard cleanup from the buyers and they got it. Like they got over full price, all this stuff and, and the buyers had to come clean the yard. You're not that far off.

[00:21:11] Guy Giles: I felt bad when people would show up here with a lawn mower stuffed in the back of their Honda. And, you know, I was like, where are you going? They're like, Hey, this was as part of the deal.

[00:21:19] Alice Lema: I won the bid. And we're not making light of people who struggled through, you know, to win a house. We're not, you know, we don't want to sound like we're being insensitive. But I think Guy and I are both shocked, constantly at what people have to go through to get a house.

[00:21:38] Guy Giles: It's crazy. And just to, just to, on a personal note, I remember going in mowing the veterinarian's lawn when I was first getting starting out, to get my dog looked at.

[00:21:49] Alice Lema: Oh, like a trade.

[00:21:51] Guy Giles: And mowed guy's lawn out on 140 ,pardon me, 162. Everybody would probably know exactly what I'm talking about there. But we don't get a phone call.

[00:22:06] Gosh, I did get it done. I mean, if affordability is always, you know, has, has still been a little bit of an issue as far as that goes, but, but there's been some relief in some other, some other ways.

[00:22:18] Yesterday I had some people that the government had to get mortgage insurance. They didn't have the 20% down, but with 5% down and they had good credit mind you, but their mortgage insurance was like $43 a month.

[00:22:30] Alice Lema: Oh, that's way lower than it used to be. What changed?

[00:22:34] Guy Giles: They've they've just gotten a lot more competitive. They've they've made it a little bit more driven on credit scores. And that was actually the really big change is, is used to it just kind of, they had their flat little fees and no matter what, and there was a little bit of change for credit scores. Again, these guys had had decent credit scores, but you would really be amazed that if we can put you into a conventional loan in the old days, everybody would just flip you into an, into an FHA loan automatically because mortgage insurance was just cheaper and that would give your buying power.

[00:23:05] And but unless your credit is really, really poor, I try to figure out some way to get you into a conventional loan. Because you're just not going to have that mortgage insurance for the life of the loan.

[00:23:14] Alice Lema: And I don't think people realize what happened. I can't remember when it was, but just like you said, the FHA program changed and now you have that mortgage insurance forever. And I like the idea of having people go into a 5% down conventional, cause at least when the asset has 20% equity, you can petition to have the mortgage insurance removed. Even if it is only 40 bucks a month.

[00:23:41] Guy Giles: Yeah, it adds up, you figure a hundred bucks made it up to, you know, what, 39,000 over the life of the loan. I mean, if you're paying mortgage insurance, especially if you're paying that FHA mortgage insurance, if you have a large enough down payment with them, it will go away eventually. But for the most part, that's not the people that are doing an FHA loan anyway.

[00:24:03] So, you know, you can just pretty much count on having that for life. And with rates low right now, you don't know what it's like later on. Once you have that equity, you know, you don't, you're, you're going to pay a couple thousand dollars to refinance your house. You don't know where rates are going to be. So I just wouldn't count on going into FHA that, you know, Hey, I'll just refinance into a conventional loan later on.

[00:24:27] If we can get you into the right program now, it's going to save you money in the long run.

[00:24:32] Alice Lema: And you have the certainty. And that's the thing, this idea of like, well, I could do FHA now because my credit score is weak or this or that or whatever. And then I can refinance later. Well, maybe not because what if the rates are back at five, which to us old timers is still free money, but that's a huge difference between 3.2 and something in the future. So that certainty is very valuable.

[00:24:54] Guy Giles: And if any lender out there just automatically starts talking to you about doing that. That's a red flag.

[00:25:01] Alice Lema: You know doing what the refi?

[00:25:04] Guy Giles: Yeah, yeah. Basically planning on a refi when you make your purchase. I have heard of lenders doing that where we're literally, it's part of your plan and I'm going to call you in this many months and we're going to do it, you know?

[00:25:16] Just give me a call, just takes a minute or two. Maybe that is the right plan. But a lot of times I've found that it is not and people had already been pre-qualified. They were already to go on a FHA program. If I can get you into something more conventional, you're really going to be happier in the long run.

[00:25:32] Probably missed me out of a refinance, but I haven't been paying for the money for a long, long time. I just try to do right by people. And consequently, I've been really blessed in my business.

[00:25:42] Alice Lema: If there's a reason to do the refi, that's different. But I think what I'm hearing you say is if you're just buying a house, you don't have any special circumstances like partners or this or that, then just a straight, regular home purchase.

[00:25:56] Why would you have a conversation? Why would the lender talk to you about a refinance? That doesn't make sense? So I think that is a red flag.

[00:26:04] Guy Giles: Yeah. And you know, a couple other things to mention. I've been, I've been actually got a couple of contracts in with Hayden homes this week. There's Jeff Addington over there.

[00:26:13] Yeah, I think they, I think they're actually, they've opened up, they're going to have 300 more houses and one thing with the new construction stuff that I've, that I've really been impressed with is I remember when I bought that first house for $137,000, first thing I had to do was put a roof on it basically.

[00:26:30] I don't know how that happened to me, but it did. And it's just nice as these storms come, as everything happens, it's the heat in the summer and you're in a well-insulated house. And if you're thinking about that way at all, I do know that there's been a lot of regulation that's come in to how they have to build these houses now. Have some of these standards, so it's, it's going to start increasing the cost on some of them. So I did just kind of want to throw out his phone number real quick. Five four one three, two nine. 9 0 8, 6. And I don't know, Jeff Addington over at Hayden homes. He's actually a really good guy. You can, you could bring Alice over there.

[00:27:06] So you have somebody to represent you. And the, the last thing, I'm not sure exactly how much time we have left, but everybody knows Zillow. They laid off about 25% of their workforces.

[00:27:17] Alice Lema: Because their business model isn't working.

[00:27:20] Guy Giles: No, and I, you know, they've been, they have been shady for awhile as far as they would go in and they know where people are looking for properties.

[00:27:31] So say the, they get a lot of high traffic in Coeur d'Alene Idaho, and they would go in and they would buy up a bunch of houses in Coeur d'Alene Idaho, knowing that there's a ton of interests. And then drive up the prices and, you know, because now you got all of these comps, they sold all these houses, turn around and sell them back as a profit.

[00:27:50] And I think they're going to take about a $327 million loss right now is what they're talking about. Their stock dropped quite a bit and they're getting out of the house flipping business. So that's probably a good thing because you want an expert.

[00:28:02] You know I just had, I just had Teresa McCann find a sewer problem on a house that, that these guys would have never, ever notified. The guy called me up. He was so excited that, that his real estate agent found this. And you know, if you're not doing the due diligence, there's no way somebody in Zillow in Seattle knows that, that this house had a major, major sewer problem with it.

[00:28:28] But she found that out and, and he's going to, he's going to get a different house. But you want that local agent that knows what's going on and knows the market. There's my plug for you guys.

[00:28:40] Alice Lema: But yeah, there's hardly any buyer's agents in Southern Oregon that recommends sewer scopes, but I've gotten stuck with that bill myself. So definitely recommend it.

[00:28:52] Well, we're going to have to take another break here. Guy Giles Mutual of Omaha mortgage. Thank you so much. We always love your updates every month. We'll be back in just a moment. Do not touch that.

[00:29:04] Welcome back to the real estate show. Again, folks, Alice Lemahere, broker John L. Scott, Southern Oregon having an update with Guy Giles and Mutual of Omaha mortgage. And it's been a month since we've talked, the rates are threatening to go up. They've gone up a little tiny bit. And then everybody went into a wild panic. So the fed had some kind of an update this week guy. What did they say exactly?

[00:29:28] Guy Giles: The main thing is what they've talked about so far is you know with a lot of the with a lot of the pandemic, just kind of running its way down a little bit, at least as far as hospitalizations. And you know, you could, you could argue that stuff either way, but that said they, they feel like they can pull out a little bit.

[00:29:51] I think I mentioned it a little bit earlier, as far as them tapering off, I think about $5 billion a month. Sounds like a big number to us, but it's really not to them. The vast majority of the money that they're investing to try to make sure rates stay low is still in that market. And it will just continue to reinvest that even if they're not adding a ton more to it they will still be adding to it just, just not quite as much.

[00:30:12] What, I'm, what I'm basically seeing as, as far as, as the market's gone, there's no appetite for rates to go way up. So I really do believe that we will have good rates for, for the near future. And on top of that, I think you know, if these guys would quit trying to add in every crazy little thing to this, this new stimulus bill, there's some, there's some money in there, that could actually help, you know, some of the lower income people, some people actually get into a house. I I'm going to reserve all my, all thoughts because we're not a political show.

[00:30:52] Alice Lema: Economically, those are not long-term solutions for sure.

[00:30:56] Guy Giles: Yeah. Yeah. But you know, we w with all of that, you know, I think if you're, if you're thinking about buying a house, the, the big thing to do is, is find yourself an agent that you, that you trust that, you know. Work with that agent, because if you're flipping around a whole bunch of different ones, I just saw this recently is why I thought about it

[00:31:16] Alice Lema: Change agents in the middle of their deals?

[00:31:18] Guy Giles: Oh, not in the middle of their deal, but while they're looking all of a sudden I'll get a phone call from another agent. And it doesn't happen much, but unless you have like a real problem, that person, that agent knows what you're looking for and you know, to, to reinvent that every time you find a house just doesn't seem like a great idea. But, you know, get your agent in line come in, we're actually doing full credit approvals for people.

[00:31:40] So I'm not just, just doing the Quicken loan thing where I tell you I'm a rocket scientist. Put down what I think I make and all of that. And next thing you know, I have a letter and the person across the country that doesn't have a vested interest if your loan closes or doesn't close.

[00:31:56] So fully credit approved, you're going to make your offer so much stronger when you walk into a walk into an offer situation. If we say, look, we're waiting on an appraisal and we may not even need that. That's that's a whole lot stronger way to go in, than just plugging your stuff in.

[00:32:13] Alice Lema: Those online lenders make the sellers nervous regardless of what our experiences even if you're not in multiple offers situation, an online lender does not always feel comfortable or safe to the, the person you're writing the offer to.

[00:32:29] Guy Giles: Well, this gets back to the can, my can soup theory. If I mess a deal up, I'm ducking in Costco all the time, worried that someone's going to throw a can of soup at me. These guys, I make up these dumb things, but, but their philosophy is I live by and that's why I got to do a good job for people.

[00:32:45] But they don't, you know, they, they just have a constant flow because they're advertising at the super bowl of people coming in. So it really doesn't matter. I mean, of course they want to close loans cause that's how they make money. You got a little problem with a well or a septic or something that we understand out here, you know, we're right here to work, work with you through it.

[00:33:02] I mean, my processors are right here in my office. My everybody is I have, you know, full access to, to the whole process and I'm not going to duck and hide behind a message machine if something's going wrong. we're just going to, you know, we're just going to fix it.

[00:33:17] Alice Lema: Yeah. And it's nice that you do the full approval. I don't think people understand. Sometimes other, other lenders are doing a two-step process where they're just doing a minimal pre-approval and then they do the full qualification later. You guys are taking the time to dive deep, right from the beginning. So when you write a letter, the seller can really bank well, so the buyer can to really bank on that.

[00:33:39] Guy Giles: Oh, it's just it's so it's so much less stress. It really is. But how about you? I mean, what, what have you, what have you been seeing? I don't, I don't get to ask a lot of questions.

[00:33:47] Alice Lema: Yeah, well, it's so interesting out there right now. We still have protocols for COVID. And we still have, I get asked a lot if I'm vaccinated. Now, I'm getting asked by by sellers and whether it's my listing or not, you know, just to show a house, the buyers and sellers are asking each other, if they've got the booster. So that's been very interesting.

[00:34:10] And then we have more and more listings coming on the market. But they're being purchased, like you said, you went for that walk and then a week later, three of those houses were in contract. So I just, I agree with you. I don't think we have a crisis coming. I think the market is absorbing the new houses that are coming online. And it's actually giving some breathing room.

[00:34:33] I'm predicting we're going to have an even bigger number of sales in the next six months, just because we have more houses to choose from. And then people will finally start listing and buying at the same time. So I'm looking forward to seeing our numbers go up, but that's just, you know, an Alice prediction.

[00:34:50] Guy Giles: Yeah, well, all the numbers that I'm seeing, they're still anticipating over 11% appreciation for next year. I mean, again, that's not sustainable forever, but I think as pandemic winds down and people that are, are really, truly scared and hiding in their basement right now, that was not a dig. Maybe so but, but as they were able to start moving around, you know, then they're still going to have the ability to work remotely.

[00:35:15] And I think they're going to, a lot of those people are going to flood this market around here because who again, who wants to do another pandemic in. a place down in LA or a place down in San Francisco. You're going to want to go to a nice place. So I think that, that this place is someplace that people are always going to want to come to.

[00:35:33] Alice Lema: Some of those urban markets are, are experiencing a downturn maybe not a crisis level, but some of their values have gone down enough. Even people who would have stayed are a little unclear about their future. And they're ,selling in some of those urban areas they're selling just because they want to take the money they have.

[00:35:55] So, you know, it's that spiral thing of mentality that starts happening, but who doesn't want to live in Southern Oregon? Oh my God. It's like the perfect place, at least for us, right?

[00:36:06] Guy Giles: Yeah. It's, it's amazing. I traveled up to Leavenworth last week. I was going up into Canada and then they changed the rules at the last minute.

[00:36:12] So we ended up running around Washington to go, just look at the trees and everything. And I come back here. I'm like, why did I go? It's beautiful.

[00:36:22] Alice Lema: Yeah. Well, when there's no fires it's perfect place. And the trees around here just

[00:36:30] Guy Giles: So as far as me enjoying the trees around here and all that, as much as I do.

[00:36:42] Alice Lema: Yeah, well guy Giles mutual of Omaha mortgage ever entertaining, ever educating. Always great to have you on the show. We'll have you back again. Next month they'll be early December and we'll talk again about what's happened in the, in the weeks to come this broadcast will be repeated tomorrow on Sunday at 6:00 PM on the same station, KCMX newstalk radio 880.

[00:37:07] We're thankful for a sponsorship from you, Guy Giles and Mutual of Omaha mortgage, john L. Scott, Southern Oregon, and the Rogue Valley Association of Realtors. You can also check out our website realestateshoworegon.com RealEstateShowOregon.com. Sorry. I'm AliceLema, broker John L. Scott, have a beautiful Southern Oregon weekend. Thanks again, guy. Have a great, great weekend. Bye.