Is the Home Sale Frenzy Over?

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The latest figures show a steep decline just when sales are usually strong. And what does that mean for the mortgage process? Hi, I'm Rob West.

We'll get all the latest on those burning questions. First up today is we're joined by mortgage expert Dale Vermillion, author of Navigating the Mortgage Maze, The Simple Truth About Financing Your Home. Then it's on to your calls and questions, 800-525-7000.

That's 800-525-7000. This is MoneyWise Live, biblical wisdom for your financial decisions. Well, Dale, welcome back to the program, my friend. Great to have you here. Oh, Rob, it's always an honor. Thank you for having me back. Glad to be here.

Delighted to. I'm sure we caught some people off guard with that opener. You know, we're all talking about how red hot this market is. You were here just three months ago, and at that time home sales and values were rising to almost frightening levels. So is this new data, Dale, saying that they've peaked? You know, I wouldn't say they've peaked, Rob, but they've certainly tapered off.

There's no question about that. We've seen some definite changes in the marketplace. You know, mid-summer this year, we started to see a little bit of a fall off from the previous record numbers that we're seeing. In fact, in June, we saw a 6.6% drop below the main numbers. That was almost a 20% drop from the previous June. But, you know, in July and now here in August, we're seeing a little bit of recovery. I think a lot of that was because, number one, we've gotten to levels where affordability was tough. I think a lot of people backed out of the market because they were tired of making offers, not getting contracts. I think that had a lot to do with it. And I think right now we're in a little bit more of a holding pattern too with coronavirus and the Delta variant and these kinds of things. I think that's all had factors. The bottom line is we're still seeing a little bit of increase in property values, but not to the extent we did earlier in the year.

Yeah, well that's really interesting and very helpful. And, you know, the time of the year makes this unusual to see this dip because typically June sales, which is where these numbers came from, would be some of the strongest, right, as we prepare for folks getting into homes prior to the school year starting. Yeah, no question. The dog days of summer certainly are when we see the highest activities, typically and traditionally, in real estate sales. Again, I think we've had such a strong market in the early spring and because it was just such a major lack of inventory that so many people were frustrated by what the market was doing. And I think that had a major impact on it. I think that's why we saw a dip where we normally don't.

So you're right, it's not standard for that to happen, but it did happen. The good news is we're starting to see that climb back out again. And even better news for buyers is that we're starting to see some inventory improvements. We're starting to see more homes out there that people can buy today, which is a good thing.

Talk about that piece of it for a moment, Dale. You know, this was a big part of what drove these prices up. You know, it's classic economic supply and demand, and if there's more demand than supply, prices are going up. The opposite is true the other way. When we talk about a lack of inventory related to homes on the market, it's not something the typical person thinks about every day.

What are we really saying? Just truly not enough homes available nationwide? Yeah, so typically in a mortgage market, what you're looking for is about a 12-month supply of homes. We were down to a 5.5-month supply in May. It jumped to 6.3 in June.

It's increased again a little bit in July, and now here in August, we're seeing continual increases. And therefore, there's homes to buy. There's just based on the demand. And a lot of that demand, by the way, Rob, is because of millennials.

You know, it's interesting. I was reading a statistic that the baby boomers, my generation, we bought our homes when we were 19 and 20 years old on average, and the millennials buy it at 32 to 34 on average. That's a major difference. Well, they've all entered the market in 2021, unfortunately. So that's what created some of that along with a lot of the work from home, people moving to places they want to vacation as their home. That was a big shift in the marketplace.

Those all kind of created the crunch. Yeah, the millennials are reaching age 30 and beyond. They're having kids. They're ready to settle down. Dale, just about 30 seconds before our first break, we mentioned new homes.

What about existing home sales? What data did you get there? Well, that rose 1.4% on a seasonally adjusted annual rate from May to June. So we're seeing an increase there, and the median price went up 23%. Really increasing.

Okay, interesting. All right, well, we're going to continue to unpack this. Plus, what does all of this mean for you? I mean, it's still, by all intents and purposes, a red hot market, which means if you've been waiting on the sideline, do you proceed? What about mortgages?

What do you need to know if you're selling? All that and more just around the corner. Dale Vermilion, our guest today, author of Navigating the Mortgage Maze, the simple truth about financing your home. Your questions around the corner as well.

800-525-7000. Stay with us. Welcome back to MoneyWise Live.

So glad to have you along with us today. I'm Rob West, your host, and we're talking in this segment of the broadcast with our good friend, mortgage expert, Dale Vermilion. You know, if you've been trying to buy or sell a home, you know this market is red hot.

There's no question about it. Interestingly, we got some good news in May and June that perhaps the housing market was starting to cool a bit, which means those of you who are enjoying these sky-high prices, well, they're still way up there, but if you're trying to enter this market, perhaps you've been renting and you're ready to buy or you're relocating to an area that's really just had appreciation. You know, you are welcoming this slight cooling off of the housing market, but you still need to know how to navigate this environment and here to help us do that today is again Dale Vermilion. If you have a question specifically related to mortgages, buying or selling a home, how you prepare yourself to buy a home from the financing side, whatever's on your mind today, this segment of the broadcast is dedicated to that and we'd love for you to be able to talk to Dale. Here's the number to call. We've got some lines open. 800-525-7000.

That's 800-525-7000. Dale, we talked about the reasons that perhaps we saw the inventory ticking up, we saw prices dipping ever so slightly in May and in June. You mentioned that some of this might just be people saying, I'm not going to get caught up in the frenzy, in the emotional responses and overpaying for these homes, but another piece of this that's going to hit us in the fall, which may add to perhaps the softening of the housing market, is those folks coming out of forbearance as a result of the COVID pandemic.

What are you expecting there? Yeah, you know, Zillow just released a report that they are expecting that approximately 850,000 borrowers nationwide are going to be exiting their forbearance plans in August and through October. Now, based on the 2008 numbers, when this happened, about 25% of those people end up selling their home and they're expecting that same kind of projection. That would literally create 211,000 new homes on the marketplace. That's a 15% increase in inventory over June numbers and that's going to help the real estate market and help those who've been sitting on the sidelines, maybe to have an opportunity to get into a home. It'll also slow down this crazy increase because as supply increases, then demand's not so great and then you don't have these, you know, 50,000, 100,000 over listing price offers that you had.

Yeah, and we certainly saw plenty of those. Dale, what about folks who still want to sell? Should they believe in some way they've missed an opportunity? Well, no, because you got to remember you still have the opportunity of the market around you take property values to a whole new level. It raised the waters, you know, in the value pool for everybody nationwide. So, you know, you're still sitting in a good position today. I would say that if you're thinking of selling, probably now is the time to put it on the market because with the inventory challenges and the other things that are happening in the current market, you're in a good position to sell right now. So, they're still sitting in a very enviable position. It's still a seller's market today.

Yeah, very good. Meanwhile, as you know, Dale, mortgage rates have ticked up a bit at the start of June. Are interest rates affecting the level of home sales and what are you expecting as we move into the fall and even next year for mortgage interest rates? Yep, so interestingly enough, interest rates don't really impact the purchase market that much, particularly when, even though they've gone up a little bit, they are historically lower than we've ever seen in our lifetime. So, we've actually seen applications increase even in the recent week by 2% in the purchase market.

So, purchases continue to increase. It did affect the refi market. Now, we had a little dip a couple weeks ago where the 15-year mortgage rate was the lowest in all of U.S. history. That created a little bit of a refinance craze again that kind of hit for a week or two. You know, they're going to be up and down. As long as this coronavirus hangs around, it's going to keep rates down from everything we've seen because the government's going to try to suppress those rates to keep the economy strong.

We did get a good jobs report with 900,000 new jobs. That had a little bit of an uptick on the rates and we're anticipating that fourth quarter of 2021, first quarter of 2022, we'll start to see just a steady climb in rates, probably get it back up around the low threes again. Still great rates, but not what we were when we were in the ones and the twos, which is unheard of. Well, let's talk about that for a second. Incredible, isn't it, to think that there could be a one handle on a 15-year mortgage and a two handle on a 30-year mortgage?

I mean, that's still available today in some cases? Rob, my wife and I just applied for a refinance with our son-in-law a week and a half ago. I literally saw the rates hit the lowest in history, called him up and said, we'll take it, 1.99 with no cost.

It was a no-brainer. It's unbelievable to me. If you just said to me, 25 years ago, I've been in the business almost 40 years, 25 years ago, some day rates will be in the ones I'd be like, you are crazy. That's never going to happen.

And that's incredible. Now, some folks are listening to you say that he's the mortgage guy, so he knows where to find that stuff. Where do you direct people when they say, how do I find a mortgage like that?

1.99 with basically no cost. I mean, there's obviously some costs, but where do you send the average person to find the best rates in terms? Because it will change depending upon who's got what money to lend at any given time, right?

Yeah. Well, the great news is this is the one big benefit of technology and being able to go online. You go to places like Bankrate or Zillow or Lending Tree, any one of these, when rates go down, they're the first ones to advertise it because they're trying to draw in, you know, people to take a look at their sites and go through that.

So you can find out this information all over the media. Then it's just a process of talking to three or four lenders and comparing between a bank, for example, maybe your credit union, you know, a local mortgage banker or broker, and just see where they fall in as to who's got the best combination of rate fees and is going to treat you the best. All those things got to come into play. Yeah, the online banks, you want one of those getting in the mix as well, at least just to evaluate what they have.

And you can find who has the best rates right now at Bankrate.com. Before we head to our first break, let's get to one call in the mix. We're taking your calls this half hour for Dale Vermillion, specifically related to mortgages and home sales and purchases. Let's go to Illinois. Barb, thanks for calling and holding today.

How can we help? Yes. So thank you, Rob, for taking my call. I don't know if I've heard this specific question before. And it's almost not just strictly a money question, but it kind of I'm glad that you're faith based, because it kind of brings ethics and just priorities, sort of.

So I'd really like to get your perspective. So our situation, my husband and I are in middle age, you know, like, mid to late 50s. Our children are grown. We've been in our house a long time. At some point, we know that, you know, there's a possibility we may need to sell. And even if we don't sell, someday, we won't be on this earth anymore. And our children or whoever.

So the bottom line is, here's here's the thing. I guess in some ways, I feel like we're different from some people, because we don't view our home as like a showpiece. We don't do a lot of entertaining to impress people like like we see some people do. So even though our home is nice, it's in a nice neighborhood.

It's fine. It meets our needs. We've never really done a lot of updating. Even sometimes I feel like with repairs, now, obviously, if there's something unsafe, we would certainly address that. But sometimes we'll just do it yourself.

That's what I'm concerned about. And this is fine for us. We tithe. We like to spend our money on other things and people and experiences. We don't tend to put a lot of money into our home. And my concern is someday we don't know when how soon that would be when it comes time for the house to, you know, however it's transitioned.

We may not get as much money for it because I've heard people say like staging is a big thing and you're making it look. And so I don't know if I'm making sense, but that's not a priority for us. It's not a priority. Yeah. So let me weigh in on that.

It's a great question, Barb. And I appreciate that you really want to be a careful steward of God's money. And as you think about preparing to sell this home someday, you know, there's a different equation that enters in when you think about what do I want to do in terms of renovations and improvements to enjoy versus what do I want to do to prepare to maximize the value of this asset, which clearly your home is.

You approach those things two totally differently. And so, you know, you're going online is going to be your friend as you research this, because what you'll see is to sell your home, you want to do things like add a fresh coat of paint or update your front door. You want to think about curb appeal with some landscaping that's simple. You want to declutter to attract buyers.

You don't want to put a new kitchen in or add a sunroom. So, you know, I think it's two totally different things. You're thinking right about this. Dale, what would be your thoughts?

I couldn't agree more, Rob. And you said the key word there that, you know, we want to be stewards of the things that God has given us. He's given us our homes. It is a gift from Him. And we want to make sure that we get the best return on investment for those. So what I want you to look at is not the optics of how does it look to other people. Look at it from the vantage point of, if God gave me this gift, how do I make it the most appealing to get the best return and also prepare it for the next buyer in the best way so that everybody wins in this?

And it's a reflection of God's love and God's grace and God's beauty. And that's what we want to do. And you're making a wise decision because you're going to get that money back.

That's exactly right. You can check out bankrate.com. I know they have some great articles on this. NerdWallet, money.com.

Start doing some research so when the time comes, you're ready. And even now, start doing some of those small things that will really help you maximize the home sale. More to come on MoneyWise Live. Stay with us. Thanks for joining us on MoneyWise Live.

I'm Rob West, your host. With us for this half hour, Dale Vermillion, our good friend and author of Navigating the Mortgage Maze, the simple truth about financing your home. May and June told us that maybe this red hot housing market is starting to cool ever so slightly. It's been wild out there in most parts of the country and for good reason. Real supply and demand issues with not enough homes for sale as millennials are buying homes.

People are moving out of the downtown areas to the suburbs because they're working remotely. We've got historically low interest rates. Dale just told us in the last segment his son-in-law is refinancing a mortgage at one point nine nine percent.

Can you imagine? That's incredible. So there's just a lot going on right now and we want you to be a careful and faithful steward of God's money and that's why Dale joins us so often to tackle these topics. We have a few lines open for your questions specifically related to this topic. 800-525-7000. Dale, let's go right back to the phones. Nancy in Spokane has a question about an FHA mortgage.

Nancy, go ahead. Yeah, thank you so much for taking my call. I bought a home almost a year ago now and when FHA and you know you have that FHA monthly insurance premium and I've been getting been contacted by private lenders and so I didn't know if it would pay to do that. I don't know if you're charged you know a lot of different charges to do a private loan to get rid of rid of that FHA. Very good Dale.

Your thoughts? So you know once you get to an 80% loan to value, in other words the mortgage balance is 80% or less of the total value of the property, then you can qualify for a conforming loan and you can eliminate that mortgage insurance. Now the good news is the marketplace has been so rapidly increasing that many people who even bought or refinanced a year or two years ago, many of them have already outrun that 20% and qualified. You may be one of those individuals and I hope that you are. So I would certainly talk to a lender about that if you're being contacted.

There's probably a reason for that. If your home value is increased enough that you can now get rid of that mortgage insurance, it could cut hundreds of dollars off of your payment each month. You just want to make sure you know what the fees are on the loan that they're going to charge and make sure that whatever you're saving is getting rid of whatever your costs are within the first 12 to 24 months. That's typically what I like to see happen and then if you know you're gonna be there at least two years, everything after that is profit for you. So you do want to make sure that you're looking at that option.

You also can potentially go back if you've built enough equity and sometimes have them just take it off if you've grown enough equity but sometimes they got to do a reappraisal in order to do that and there are some guidelines that fall in that depending on the lender. Nancy, appreciate your call today very much to Tipton, Indiana. Mary, thank you for your patience and for calling today. How can we help you? It's no problem.

Thank you for taking my call. My question is my daughter is selling her home. They're moving out of state and they, the buyers, potential buyers backed out. They did have an inspection. The buyers paid for it, potential buyers and my daughter would like to be able to see it. Is there any way that they can get a copy of that inspection? Yeah, interesting.

Dale, your thoughts? Well, probably only with the approval of that prospective buyer. They may be able to buy it from them to get access to that because the buyer did pay for it. It is theirs so they kind of control what they can do with that. There's nothing where you can just say that you can demand it unfortunately but you can always have your own inspection done.

It might not be a bad idea to do that just to know what's happening with that and that could help identify any potential problems that you have. Very good. It's always so important to be able to see that and Dale gives you great counsel there in terms of how you would want to go about that.

Dale, we're going to head into our next break here in just a second. This is an environment where you have to go in prepared. In just 20 seconds, what do you need to do to be prepared to buy a home from a mortgage perspective? What's key?

Do your homework. Proverbs 24-3, buy ways in the house and build your understandings established. Make sure you've got your documents together.

Make sure you look at lenders and rate and make a few calls. Yeah, there you go. I think that's so key and we've got to go in knowing what we're willing to pay and not get emotional and chase a price up beyond what it's actually worth. Dale's going to stick around for one more segment, taking your calls and questions.

800-525-7000. This is MoneyWise Live, biblical wisdom for your financial decisions. Welcome back to MoneyWise Live.

I'm Rob West, your host. So glad you're along with us today, taking your calls and questions on mortgage issues and housing market issues. We're going to turn a corner here in just a moment though and we'll be able to take your calls on anything financial. For this final segment with Dale Vermillion, Dale, we've been unpacking just what's going on around us in the housing and mortgage mortgage market and how we need to respond. You know, I mentioned something just before the break that I'd love for you to touch on and that is to know what you're willing to pay for your budget and based on what's a real market value which can be hard to determine before you make that offer because we can get caught in an emotional trap in a market like this, can't we? That is such an important point, Rob.

I totally agree. Set your budget. Put it in stone. Don't go beyond it. Don't get caught up in the bidding wars. And remember, when you set your budget, it's not just for the payment that you can comfortably afford, but it's also based on the term that you can comfortably live with. Remember, we want to be out of debt. We don't want to go longer than we need to.

So if you want to be debt free in 20 years, let's say you think you're going to retire in 20 years, you shouldn't be taking on more than a 20-year term on your mortgage because especially in retirement, if you're going to go from a normal income to fixed income, it could drop. You don't want to put yourself in a financial bad position. So be sure you've got these things figured out well in advance and then stick your guns and stay with it. Yeah, be willing to walk away.

That can be your very best friend in a market like this. Eric is in Indianapolis. Eric, how can we help you today, sir? Hello, sir. Thank you for taking my call. I really appreciate it. Sure.

Yeah. We refinanced in 2013, did a 15-year mortgage. We have 70,000 left on it. The interest rate's like 3.375. I was trying to figure out if it would be worthwhile to go refinance to try to find a lower rate or just ride it out. We all want this thing paid off as fast as possible. Yeah, absolutely.

Dale, what are your thoughts? Well, any time that you can match or reduce your term, reduce your rate, and pay minimal fees to do it and gain benefit and savings, you want to do it. So even in a balance, if it's only $70,000, but you took it out for a 15-year, you took it out eight years ago, you got seven left, you wouldn't want to go beyond that seven-year period. So you could look even at a five-year loan, for example, and you might find the interest rate difference that we're in today might get you a five-year for about the same payment you're paying today. You've cut two years out of your term right there instantaneously without raising a dime. As long as your costs are low to get in that loan, that could make a lot of sense for you.

Yeah. The key is you just want to make sure you're going to stay in the home long enough to realize that savings. And as Dale said, make sure you can get the reduction, but also check those mortgage expenses.

Don't overpay. Dale, you know, I typically say try not to pay more than two percent of the mortgage value for the cost of the refinance. Is that still a good rule of thumb? That is still a good rule of thumb, yes it is. In fact, nowadays you can get a lot of lender credits where some of that can come back to you, but you're right, you never want to be beyond two percent. Yeah, so $150,000 mortgage you're refinancing, you shouldn't be spending more than $3,000, and what you may find is it's six or eight thousand because they're having you buy down the rate in an environment like this, Dale, there's no need to do that, right? No, not when your rates are so low as they are, unless you're going to be there for 30 years and long term you're going to save another $15,000 by doing it, but you got to know it's your forever home and you're going to be there.

Otherwise, your rule of thumb is the one I always follow and I think you're dead on with that every time, Rob. Yeah, you know, our best intentions of staying somewhere just don't play out on average, so be pretty certain of that. On to Lansing, Michigan. Denny, you've been incredibly patient, sir. How can we help you?

Yeah, I've got a two-part question. We're trying to buy some agricultural land, and the values at retail are right around 72 to 7,500 maker, and wholesale prices on foreclosed land is around 35, and when I go to the lending institution, they'll only lend on the 35, not at the retail value. Do I need to find another bank, or how do we navigate this? Yeah, that's pretty standard because anytime you're in vacant property, there's no structure that carries the value for you, so it's very common to be at 50% or less loan to value on those things. You can certainly look at another lending institution. I doubt you're going to find much of a different answer upon that. What I would try to do is see if you can find, you know, access to some of that foreclosed property.

There's some out there you can tap into, and that may be the best route for everything. Very good. Denny, thank you for calling. You said you had a part two.

Go right ahead. The fluctuating values of real estate for homes, how come the agricultural or vacant land doesn't follow that same trend? Well, it's because of, yeah, the money's really in the single-family homes and the residential properties, not in the agricultural property. That's the main reason why. It's just the use of the land is what dictates what the values are going to do, and then what you're building upon that. We've always seen that agriculture is nowhere near the residential market.

Commercial also is different than the residential market, so it really just comes down to usage at the end of the day. Yeah, very good. Pam's in Hollywood, Florida. Pam, just a couple of minutes before our next break.

How can we help you? Hi. I just recently retired, and I want to sell my home and move closer to family, and my realtor said that I don't need to do anything great to the house. You know, it doesn't need to be painted. It doesn't need to be anything that I should sell it as is, because people might come in and just gut it or fix it the way they want it, and I just wanted to know what your thoughts were on that. Yeah, very good.

Dale? Yeah, well, you know, I would probably get at least a second opinion just to make sure, because one person's eye might see different than another, because there is some logic. Rob talked about this earlier, about the importance of making sure that there's good curb appeal and, you know, light colors and bright colors and things that people want to see, but as far as changing things aesthetically, many times that is a waste of money, because you're just putting something in that you're exactly right. The next buyer may not want it. You just want to make sure it's clean, it's bright, it's, you know, everything's organized well. If you do that and you've got great curb appeal and everything's really set up nice, you're probably in pretty good shape. I do like to recommend that people do get a second opinion from somebody else just to see what their thoughts are too, just if there's any little tips they can give you that might help sell the home.

Yeah, absolutely, and again, the internet is your friend here. What you'll see is just what Dale said, a fresh coat of paint, your front door, simple landscaping. You know, if you have a dark kitchen, don't go in and renovate the kitchen, but you might want to paint the cabinets, you know.

I mean, that's a great way just to completely change the look and the feel of the home, maximize the value without spending a fortune. Pam, thanks for your call. I'm going to twist Dale's arm, see if he'll stay for our final segment today, because we've got still a good many questions on mortgages, the mortgage process, and buying a home. So Dale, can you stick around? Absolutely, be glad to. You're out. Nothing like putting you on the spot. Hey, before we go into this next break, I've got about 20 seconds here. You're a mortgage guy that actually likes people to get out of debt, right?

I do. Romans 13-8, owe nothing to anybody except for your obligation of one another. It's one of my favorite verses of the Bible, and I think we all want to try to live by it. Yeah, we want to move toward being debt-free, and I would say including your home. Try to time that if you can't do it sooner by the time you reach retirement.

That's going to dramatically reduce your lifestyle expenses, put you in a great place, too, to follow the leading of the Lord during a really exciting season of life there in retirement. One more segment with Dale Vermilion around the corner. Don't go anywhere.

We'll be right back. You're listening to MoneyWise Live. I'm Rob West, your host.

It's always a good day when our friend Dale Vermilion stops by. He's the author of Navigating the Mortgage Maze, the simple truth about financing your home from Moody Publishers, and he is someone who helps us pull God's financial principles out and apply them to the mortgage process. Let's go right back to the phones and Wyndham of Ohio is Bob, and Bob, how can we help you today? Yes, I've spent most of my life giving money away. I lived overseas, and so when we came home, we didn't have much, but we bought a house and fixed it up as I was passing a church, and we made good profit on that, and so we sold it and then bought another house about a year and a half ago, and now we've just moved to another church that has its own parsonage and that kind of thing, and so my question is, should I sell my house, invest the money, or should I keep the house and have renters get in there and see if there's people that we can help that way?

What should we do? Yeah, you know, it's a great question, Bob, and you know, I like both asset classes. I like the stocks and bonds. You know, there's a lot of money to be made there if you invest according to biblical principles. You seek a return, but you do it on a long-term basis, and you're properly diversified, and you're not trying to get rich quick and pick the high-flying winners and losers, but you take more of a steady plotting approach.

I mean, that's what God's Word encourages. One of the other benefits of stock and bond investing, Bob, is that it's passive, so you know, you could hire somebody to build the portfolio and oversee it, and you don't get any phone calls in the middle of the night if you need to make a repair or there's a plumbing issue, and you don't have to worry about whether or not you have a tenant one month to the next, and so in that season of life, as you're looking to perhaps simplify a bit, there's a benefit to having a stock and bond portfolio, which would mean you sell that asset, especially when stock housing prices are high, and you redeploy that. Now, the other side of that is I love real estate as well. There's something to be said about having a piece of property that's paid off, that is cash flowing, that continues to appreciate, and so I think it really comes down to, you know, do you need to generate income, and can you generate enough through the rental prices, you know, that you have coming in, and are you willing to be a landlord into this next season of life, as you think about all that goes into that, or would you rather have something more passive, because you can make money in both asset classes. Give me your thoughts. Well, my wife and my financial advisor think that I should sell the house.

I'm still in good health. I'm only about 70 years old, and I expect I'll be in the ministry for the next 10 years, and the house is located near where one of our children live, and the grandchildren, and it's only about 40 minutes from us, so the skills and stuff as far as plumbing, you never know about what a tenant's going to do the house until it's too late, so I kind of like the physicalness of real estate, and yet I know that you can make money on stocks also, so yeah, I'm kind of in the middle, that's why I asked. Yeah, I think that, you know, there's something to be said about perhaps splitting the difference.

Maybe you hang on to it, and, you know, while you still have a lot of energy, and you're enjoying it, and as long as it's producing the income you want, but you can, you know, I would always compare that to a reasonable rate of return in the market, and think about can I do better or the same with less effort and work that gives me more freedom and flexibility to serve the Lord and, you know, be used in a season of life, so just be constantly evaluating that to see both the financial side as well as the non-financial side, which makes the most sense, and perhaps you stay with the real estate for now, but you look to sell it, you know, a few years down the road. We appreciate your call today, Bob. Let's head to our next caller, line one. I don't see your name, but I know you have a credit score question, so go right ahead. Yes, hello.

Can you hear me? Yes, uh-huh. Okay, so my question is, to have one of those low interest rates, what are we looking for? Maybe we can go briefly on credit score and debt-to-income ratio, because I know not everyone can get, you know, those low interest rates, and also with an FHA and a conventional loan. Are we talking, can I still get one of those low interest rates, or do they vary? Are they different? Yeah, Dale.

Yeah, great question. They do vary depending on your credit score, because that is one of the primary factors lenders use. If you're over 780, you got nothing to worry about. You're going to get the best rates out there. Many lenders over 720, you'll still qualify in that very low rate category. Then the next gap is 680 to 720 is where a lot of lenders will start to change a little bit and add a little bit of interest rate, and then 620 to 680 is typically the last one. Below 620 is where it starts to become a little bit more difficult. There's loans out there you can get, but you're going to pay a little bit more interest rate for those. But even in those lower sectors today, the rates have been so good for so long, but there's still some incredible rates even at those kinds of credit scores.

But yes, the higher the credit score is, whichever one of those you fall into, the better you're going to get in the ultimate interest rate for your loan. Very good. Thank you for your call today. Edleen is in my hometown where I grew up, Fort Lauderdale, Florida. Edleen, go right ahead. Edleen, are you with us? All right, I think we lost Edleen.

If we get her back, we will get her on the air. Dale, we've covered a lot of ground today. I think, you know, if you were to summarize some of the key points and takeaways of what we discussed today for those who are out there, still some thinking about refinancing, others trying to figure out, should I buy in this market?

Others thinking, is this the time to sell? What would be some of the key ideas you'd have us take away today? Well, I would start with Proverbs 15 22 says plans fail for lack of counsel with many advisors.

They succeed. Look, you want to do your homework. You want to budget. You want to plan and prepare.

We've talked about that many times. Plan not just your short term. What are you looking to do today in buying a home? But what is your long term plans, both for term for growth, for investment and make sure that you are when you go into the decision to buy a home or to refinance, you're really doing your homework to make sure that you're buying in a good location that you're not overpaying for the price.

And again, we can't say enough. Don't make an emotional decision. Make make a good, prayerful, godly decision in these things. If you follow those simple guidelines, I think you're going to be in great shape in this marketplace.

Yeah, boy, that's such good advice. Dale, just quickly before we're out of time here today, what about using a professional, either a mortgage broker, someone between you and the possible lender who can help you find the right loan program versus you doing it yourself and using a real estate professional versus trying to do a for sale by owner? Yeah, so let's take the mortgage broker side first. You certainly want to talk to a mortgage broker as one of your resources.

You want to talk to any institution you work with in a long time or if you have a current mortgage holder, always talk to your current mortgage holder because sometimes you can get a discount or get a better deal through them. So yes, to have somebody who can negotiate on your behalf, it's to your benefit to do that. Just make sure that, you know, all those fees need to be disclosed up front. Make sure that you're getting the better deal at the end of the day and it's saving you more money. As far as the real estate broker, again, it comes down to if I'm paying a commission for this, but it's going to get me more of the value that I'm looking for that I can get on my own. That may be a good choice, but you know, you can do a lot of things for sale by owner today because of technology where you can and really hot markets get top price for your dollar. Of course, all of these professionals are working to help you and they do provide support.

You just got to look at what those fees are compared to the return and make your decision, again, based on a prayerful decision and what is wise in stewarding God's money. Yeah, that's great. We did get Edlene back. Edlene, I've only got about a minute left.

What's your question for Dale Vermilion? We owe $130,000 in the whole home with 4% interest rate. My husband will be retired in 4 years, but as for now, we start paying $1,000 monthly toward the principal. I would like to know if it's worth it to be financed now. Edlene, let me ask you, how far into this mortgage are you? How many years do you have remaining on it? Oh, I'm far because I had issue with 40 years mortgage. And how long have you had it? Oh, since 2000, I think it's 2006.

Okay, all right. Dale, four years out from retirement with a 4% mortgage and, you know, they're 15 years into the mortgage, probably a 30-year. What do you think? Yeah, I think she said 40-year if I heard it right.

There were some of those back in that day, so if that's the case, she's got 25 years left. Yes, I would definitely put an application in and see if she can get that rate down where she can get that 25-year down closer to a 20-year or 15-year loan for the amount she's paying, pay that extra principal like she's doing, and all of a sudden she's out of that thing in five to six years. So we want to be debt-free by retirement. That's our goal. And if you can take some of the benefit of lower rate to do that, as long again, and we've talked about this so many times, the costs don't take away from that.

Make sure whatever your costs are, that your savings is clearing that out within the first 24 months and everything after that is profit, and it could be a very good decision for you. Yeah, I totally agree, Edleen. Definitely check it out. Let's make sure you at least keep the term to, you know, the same. So if you have 25 years left, let's not do anything more than 25 years, but if you can get it down to 20 or 15, especially since you've been sending extra, you'll be in a great spot. We appreciate your call today. Well, Dale, my friend, so thankful for you, your ministry heart. I know you're doing some great work overseas in addition to literally training thousands and thousands and thousands of mortgage brokers every year, but I know you're generous with your time to come on this program so often, and we're grateful. I love you, my friend. I appreciate you so much, and God bless. Have a great rest of this month, and I look forward to seeing you next time. I'll do it and can't wait.

The book is Navigating the Mortgage Maze, The Simple Truth About Financing Your Home. Well, that's going to do it for us. MoneyWise Live is a partnership between Moody Radio and MoneyWise Media. Let me say thank you to my team, Robert Sutherland, Amy Rios, Dan Anderson, and Gabby T, the amazing Gabby T on the phones today. Thank you for being here. Come back and join us tomorrow. We'll be here, and we'll look forward to having you. God bless you. Bye-bye.