• Jared Jones

Interesting update | How Covid19 is Impacting Your Next Home Loan! | Jared Jones with Jason Cota


Everybody Jared Jones today, I am joined by a mortgage lender, extraordinary Jason COTA, fairway mortgage, one of my longstanding partners in the mortgage field. And if you know, any real estate brokers, that are doing phenomenal work, they always have a tight team around them. And I count Jason to be, uh, one of the sharpest professionals I've ever worked with in lending over 19 years of selling thousands of homes, he is, uh, solid. And, he comes in clutch time after time, uh, not only providing, high care and high service to clients that have high standards and want great interest rates, but also come in clutch when other lenders mess up deals or deals fall apart, or, you know, just so many potential issues, that, uh, in the lending world, who you really do partner with matters because, uh, not everybody's the same.


It's just like any other industry. And I think probably more so, that the impact on a client of working with someone who is poorly qualified in lending, really can run you out of the market and possibly even cost you buying a house period. So with that, I want to, uh, welcome Jason. And the reason I brought Jason on today is I want to talk about mortgage lending. I know there's a lot of, you know, people in the marketplace right now who are considering getting in there thinking, you know, what I've been hearing, the financing is different. They may have heard that it's easier. They may have heard that it's harder, but almost everybody, that may not even be a specialist in their field of real estate, who's even considering buying or selling might be thinking, you know, what COVID, has changed has impact financial systems it's impacted, the mortgage industry.


And it did. So, no matter what you've heard, uh, make no mistake that, uh, when, COVID slowed the economy in 2020, with it changed lending guidelines. And so I've got Jason on and I and him were talking about, how things that we thought maybe changed forever, have, have come back and, and some things that, that did change during COVID just still have, are still the same. And so I wanted him to fare through those details and kind of, uh, bring everybody up to speed. So Jason, welcome to, uh, welcome to the video.


Thanks for having me here. Happy to be here. So yeah, uh, obviously, you know, a lot of change last year. Our industry is always evolving anyway, but when you throw, you know, a bit of a monkey wrench into a situation economically and globally, you know, things, things tend to change and evolve with those. What we saw last year obviously came on really quick. In a matter of overnight, we saw some pretty drastic changes initially that might've put some buyers out of the market at the time weather, unfortunately from a job standpoint, from being furloughed or temporarily laid off, to lending guidelines tightening, because investors didn't know what to do in the stability, uh, buyers ability to, to make repayments and then even further more down the line, the secondary market and liquidity with mortgages on how the fed and the government was going to handle this crisis when it came to homeownership.


So a few updates just kind of wanted to reach out to everybody now, as we start to see these guidelines, ease up back again, get back more to traditional lending criteria that we've been so comfortable with over the past several years. Just get some updates out there. So everybody knows where we stand and hopefully, we can get a few more people back into the market, shopping for homes, again, that might've taken a step away for a short while. So the main update would be, you know, every year conforming loan limits change. And that's, you know, on average how much you can borrow for, you know, your standard type of wealth. So one of the touch bases on that since this is our first video together for the new year, every County may be a little bit different depending upon if you're considered, a high-cost area, but just a general rule of thumb for this year.


The conforming limit has moved to $548,250. So that is the big sound. Some areas, again, might be a little bit more before you become a jumbo loan, but that is where you can tell up to with your standard Fannie Mae, Freddie Mac loans. So that's been the biggest change. It's a huge jump from several years ago when it was 417,000 was the conforming limit, you know, not too long ago. So that opens up, you know, a lot more room for buyers to get out there with the homes that we're seeing increasing in price due to economic situations, low-interest rates, creating more buyers, lack of housing and inventory. The main, I think change that we've seen recently from COVID to current, is really credit. When COVID hit last year, we saw credit score requirements tighten from anywhere from six 40 to six 80 with lenders for your standard loans.


Thankfully those have started to ease back up as the economy has recovered and we're moving along the line here and we're now back down to a five 80 minimum credit score. So good to be back at those low levels, help people out. One thing for everyone to understand as well is even if you're, don't believe you're at a five 80, or you're on that cusp of being there. We also on every file review our client's credit with them but run simulators to see what can be done to help you get your slow up. So if you're below a five 80, or let's say you're at a six 21 to get you the best rates out there and get you up to a six 8,700, we're going to run those systems and software to be able to help guide you and putting you in the best position possible.


But at least for a starting point, now we can start to get people in with a five 80 credit score. That's been the biggest jump we've seen to be able to help more buyers. Secondly, when COVID again hit, we saw jumbo programs pretty much, dry up reason being is they're not, they're not insured like many other loans are, uh, their investor base, what we call portfolio programs. And those are always the riskiest loans because they're not insured. And, you know, they're typically the larger loan amount. So those went away completely. Then they started to come back with a minimum of 30% down 25% down. We're actually at right now, a minimum of 15% down on our jumbo programs, which is amazing. In addition to that, for those, if you were aware of what PMI is, the additional insurance that is placed on loans, when you do not put down 20%, our jumbo programs with 15% down, do not have that additional insurance.


So there's no PMI on our 15% down jumbo programs. Those rates are very close to our standard rates, sub 3% still at this time. So those are great programs that we're starting to see come back to help our buyers that are looking for something above that new conforming loan limits, and still sticking with jumbos. Now we can get all the way up to $3 million on financing, not the purchase price, but actually, your loan amount being at $3 million. So that's been something that we've been seeing that come back more. I think we'll continue to see the easing in those programs a little bit slower than like I said, that standard Fannie Mae Freddie Mac type loans because of the insurance reasons. But, they are coming back. They statement programs for those of you who are self-employed out there. A lot of times you take advantage of being self-employed and therefore you have deductions on your tax returns to provide yourself a tax shelter.


But when it comes to the lending industry, we qualify you as all lenders do off of your taxable income. So a bank statement programs are a good alternative to traditional financing because those who are self-employed most banks, the problem has been with those programs is in a competitive market. Jared, as you know, having a righty 45 or 60-day escrow is not the most appealing to your sellers out there, right? They've got a lot of buyers. It's a competitive market. Those are tough to get accepted. We can do that in-house for 30 days or less. So we can still remain competitive for our self-employed borrowers when having to use the alternative financing, that exists nowadays in those banks, senior programs. Another thing that just came out, it's not a, it wasn't a result of COVID that it went away just hasn't existed before that we're happy to see available is FHA.


The federal housing administration has now come out with a program for dreamers or DACA borrowers, which is huge. There's been, you know, a lot of people asking for that for some time, they just rolled out the program about two weeks ago. So anybody out there that has been in that situation, you have not been able to purchase because you're a dreamer or, you know, or fall under that category of DACA. Please contact us because we do have options to help you become a homeowner now in this market. So that's been great. And then the final piece, I think that I just want to kind of remind everybody up, you know, markets and rates change all the time. Obviously, interest rates have dropped at historical lows because of what we've seen with COVID recently. Eventually, they're going to tick up, you know, the market's not going to sustain well rates.


There are things like inflation and other economic, information. That's going to come up as the economy recovers, as we get further away from COVID and vaccinations and such. That's going to push rates up in here. Keep in mind this time, last year's rates were at roughly 4.25 to 4.375%. So for those of you who may not have gotten to a home when 2.25% was available or two and a half percent, you know, rates today are still hovering 2.6 to five to 2.8, seven, 5% and still are historically amazing rates to take advantage of don't miss out on buying your home in the hopes of another round of something happening, dropping the rates even further than what we see them today. That's pretty much the quick and short recap of where we're at today on updates. Well, we'll keep you up to date as time moves on new programs come out and credit eases. But those are probably the main things that we've seen recently.


Awesome. Jason, Hey, I appreciate your time, man. I was, you were telling me the day that the 100%, uh, no income, no asset is coming back in a couple of weeks. Is that still the case?


Uh, we'd love to see it come back. I'm not sure if we're going to see that,


Man. That's funny. You kept that you kinda, you kinda serious there for a second. Like what do I say to this question? Well, Hey, it was, Hey, it's good to see. Jason's uh, one of Jason's partners on the wall behind him in that and that picture. And uh, I think that's the new executive of his team. And so he, uh, it's, it's an onlooker, make sure he's doing his job every day. So Hey, one of the things, Jason code again, fairway mortgage, I'm going to let everybody know that his information is gonna be on the screen. We're going to do an outro at the end of this as well. So you can take his contact information down and I would tell you no matter what state you're in if you're in the US, Jason's licensed and multiple States, and chances are he can help you in some way, no matter where you're at, and it will be worth your time.


Even if you've already talked to a lender to get a second opinion, an additional opinion and mortgage are benefits. No one is more than you. So, I would tell you that if you are looking to do this, and if you've given any thought to buying a home in the 2021 period, this is a process it's not an event. And so you would start early and do yourself a huge service, and reach out to Jason. He's going to be a huge resource to you. So with that being said, let's continue the conversation in the comments. If you have, uh, updates or future video ideas, or you just want to ask questions, even here, be happy to take any information and communicate with you, and you kind of carry on the conversation online with that. That's the end of the video. We'll talk to you guys all real soon.

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