The Top 3 Options To Lower Your Interest Rate (Including The 2-1 Buydown Option) – Lee Barroll
Lee Barroll is a loan originator in Nashville, TN. He has 26 years of experience and enjoys helping all types of homebuyers accomplish their goals. When not working, he loves hanging out with his 2 dogs, Charlie and Bernie.
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This is an automatic transcription (sorry for the typos in advance! 😅)
Laura Moreno: [00:00:00] First Time Home Buyers Nation, I am Laura Moreno and I am super excited to bring you our fantastic guest today, Lee Bar Lee is a lone originator in Nashville, Tennessee.
He has 26 years of experience and enjoys helping all types of home buyers accomplish their goals when not working. He loves hanging out with his two dogs. Charlie and Bernie Lee, are you ready to.
Lee Barroll: Yes, I am. Thank you very much. Great.
Laura Moreno: So I’ve given our community just a little insight. Please share more about you personally and then expand upon your business.
Lee Barroll: I’m sorry, what was the question? Oh,
Laura Moreno: sure. , I would say share more about you personally and then expand upon your business.
Lee Barroll: Sorry. Um, oh, well my name is Lee Bell and I’ve been doing this since 1997. So I have a little bit of experience. Um, I’ve worked for, uh, in a variety of positions to include management.
I most prefer working with people, um, at the end of the line. Um, about me personally, I served in the military [00:01:00] for 14 years. Um, part of that time I was a recruiter and I can thank the army for giving my fabulous sales training. Um, and the probably the most important thing about this job is listening to people and, uh, putting myself in a position to help them because the more I can help somebody else, essentially, as Zig Ziglar says, the more I’ll get.
Laura Moreno: Wow. Observ me. What, what do you mean You were in the military and that taught you how to sell ?
Lee Barroll: Well, um, what, what I’m most proud of is I was airborne infantry, a paratrooper for the first four years, and then I was mechanized infantry for the second three years. In the last, um, seven years, I was a US Army recruiter.
So it’s a sales position and, uh, typically you’re, you’re presenting your product, which is enlistment in the United States Army to a 17 year old and their parents in a living room. So it’s, it’s challenging and rapport is probably one of the most important parts because as we know, people work with people they like, you know, and people will accomplish a goal if they’re working with someone they like.
So, um, having that [00:02:00] experience, I was able to parlay that into my current job. And I think that one of my. Solid skill sets is that ability to establish rapport on the front end of the um, transaction, because the more we can communicate effectively from the beginning, the easier it is at the end. You know, I want my goal, essentially, If we’re gonna have problems, let’s have problems now and get it outta the way.
I don’t wanna, you know, go through this whole process with you and then we go to closing and for some reason, um, you feel that questions weren’t asked or answered correctly. Um, I just want everything, I want you to be mad at me up front, not at the end. I dunno if that makes
Laura Moreno: sense or not. Why would anyone be mad at Julie?
I mean, tell me more about that. Like what, what are the potential conflicts that show up when you buy a home and what could go wrong that you can solve at the.
Lee Barroll: Um, okay. So the biggest thing is communication and communicating effectively and making sure that the client understands the transaction up front.
Understands the numbers. What is my [00:03:00] purchase price? What am I borrowing? What is my payment gonna be? How much cash do I have to bring to closing? Now, yes, of course. I mean, this transaction could be anywhere from 15 to 45, 60 days. So you have good solid estimates up front, and they need to understand the mechanics of loan, what kind of loan they’re.
Typically people are going with a 30 year fixed, especially a first time home buyer. But it’s like if we’re gonna have. Basically challenging understanding the transaction up front. I want it to be in the beginning because I don’t want them to show up at closing and how, why you didn’t, if you never told me my payment was gonna be that high, you never told me I needed this much money.
And that stuff happens, Laura. I mean it, and, and it’s really a failure on the loan officer part to effectively communicate the information that’s most important upfront at the beginning of the transac.
Laura Moreno: So how do you do that? Because one thing is to pass on information. Like you may say, you know, Laura, your payment is going to be $3,000 a month.
But the other thing is for the other person, for me to assimilate that, like how can you [00:04:00] make sure I assimilate that data? Because one thing is listen to it and the other one is really understand and record that
Lee Barroll: information. Well, it, it’s, um, several steps to it. Um, but at the beginning there’s the establishing rapport.
Um, that’s important because I need to be, feel comfortable with them and they need to feel comfortable with me. And then secondly, depending upon their level of experience, like if somebody’s never bought a house before, we’re gonna start from scratch. We’re gonna talk about we’re getting pre-qualified now.
This is what we’re looking to do. You’re gonna work with a realtor, you’re gonna go out, you’re gonna. Find a house that you like, you’re gonna make an offer. I mean, I take it from the very beginning, all the way to the end, simply the mechanics of it. So they have a fundamental understanding of what’s gonna happen.
And then based upon the information we’ve developed in the beginning, we talk about a price point. And then from a price point we establish what a, what are their abilities? I mean, how much can they afford and how much do they have to put into the transaction? And then [00:05:00] B, what it looks like. Um, and if you do it correctly, you’re gonna be close.
There are some things you can’t control. You can’t totally control the payment, um, until you lock the interest rate. And you can’t lock a rate until you have a contract. But you can definitely show somebody what the transaction looks like and then being available to answer their questions. And it usually was somebody who’s brand new to the process.
It’s usually. Two, if not three conversations about the transaction. Because if you try and do that all in one conversation, what’ll happen is the person’s eyeballs will roll in the back of their head and they will stop listening. So I like to, um, give them a general overview, then present the information to ’em, a a worksheet or a proposal to them, and then we review that.
And along the way I answer their questions. Um, and then we’ll have a follow up call to that to see what questions they have. Cause I mean, It’s the unanswered question that creates the problem, and I make it clear to my borrowers, especially my first time home buyers, [00:06:00] that it doesn’t matter if we talked about it last week.
I, if you have a question about it, please ask it. Don’t leave that question unasked because I don’t know if you don’t tell me what you need to know. I don’t know. and that’s what I need to do in order to properly give you the information so that you can make a decision, probably the most important financial decision that you’re gonna take part of in your entire life.
So, um, I’m a passionate believer in that communication from the beginning. .
Laura Moreno: I, I agree with that and I agree with that so, so much. And what are your, So, you know, millennials, we are gens now, we are so used to doing, finding everything online, and that includes a preapproval letter, prequalification, preapproval lenders.
Uh, what ends up happening is that you request pre-approval online, , you fill in your information within two minutes, everything is filled in, you send it, and then they give you a mortgage. So my, my question to you is like, why would anyone need two, three [00:07:00] conversations to get the same outcome? A mortgage?
And I’m like already answering it in my head, but I want to take your point, your point of view on that.
Lee Barroll: Well, again, it depends upon the experience level of the borrower. Um, I have a client I’m working on now. They’re buying an $800,000 house. They’re putting 20% down. It’s like the fifth house they bought.
You know, communication is minimal. He wants to know what’s going on. That’s it. I ask him for something, he sends it right away. But with a, with somebody who’s not, and it doesn’t necessarily have to be their first time, but for somebody who’s not as experienced with that, you just, I mean, I feel a responsibility.
To take time with them to make sure that they have the opportunity to ask their questions, and most importantly, not to make them feel like it’s something they should already know. Because why should they, You know, I’m the one that’s been doing this job since 1997, not you. How can I expect you to understand it?
For me, this stuff is, and I [00:08:00] hesitate to use the word easy, but it’s like a puzzle and there are pieces to it, and I. 26, 27 years of putting that puzzle together. So it’s pretty easy for me, but for somebody who’s never done it before, they look at those pieces and they’re like, uh, what goes where? And so, um, you can make it sound very simple, but I just need to make sure that myself and my borrower are communicating effectively so that they understand what they.
Because they’ll tell you. They understand and they don’t. You can always tell, and not everybody, not everybody, but I, I mean, I’ve gotten plenty of compliments. I’ll toot my own horn from people that said, I’ve taken a, a complex procedure and explained it in a very simple fashion. Um, but there’s steps to it and you have to stop and check.
I know. I don’t know. Um, it’s just the really important part of, it’s probably the most important part of the process, in my opinion, for both myself as a loan officer and my client as the.
Laura Moreno: Got it. Got it. So tell [00:09:00] me more about Nashville, uh, what’s going on in the market And I want to talk about the property prices.
And you are closing loans here and there all the time. So you know so much about the market. And also I want to know about, you said now you think it’s a great time to buy a home and we all know interest rates are way up. So if you could talk me through your thought process. Why is now a great time to buy a home and how is the market
Lee Barroll: where you.
Uh, okay. So the why it’s a great time to buy a home because if somebody was in the, is in the mindset to buy a home. Yes. Interest rates are higher today than they were two years ago. Okay. Or a year ago, or even six months ago. That’s a fact. But the fact, and I’m just using a number, I’m not quoting anything, but let’s say the rate we’re talking about is 7%.
Oh my God. It shouldn’t be. But the 7%, if you buy now and rates go up, you’re happy because you have a lower interest rate. If you buy now and rates go down, you’re happy because you get to refinance to a lower rate and get a lower payment. So not buying the [00:10:00] home that is going to suit your needs for you and your family because of interest rate, is probably not the wisest decision, in my opinion.
Now, if you wanna be a renter, that’s fine, and I can respect that. If buying a home is not. One of the options that you’re considering, No harm, no foul, but if things have come to pass in your life and you’re ready to buy a home, interest rates should not be the reason why you don’t buy. What if, What if
Laura Moreno: now the interest rate is telling me that my monthly payment, I’m not going to be, I’m going to be house poor, it’s going to put me in trouble to have that house payment.
What? What would you say to that?
Lee Barroll: I say, don’t do. I mean, you know, um, I mean, I don’t tell people how to live their life. They have to make their own decision. There are certain things in place that won’t allow you to get too far, but a person knows their budget and they know that if that payment is too much for them, well okay, But the reality of it is, is that you can still buy more today.
For the same payment you can rent and what you’ll get for today for that rental [00:11:00] payment. It’s a lot better than what you can rent. And more often than not, we’re seeing people actually look, they’re paying 3000, $3,500 a month for rent, you know, and they’re making the, they’re, you know, Yeah. That it seems like it’s a very large payment, and it is, but it’s already in their budget, so they have a lot to work with.
That being said, if somebody’s been living with their parents and maybe kicking in $400 a month and is looking at a $1,700 a month payment, that’s some shock. You know, it might not be the right time for make that move, but without knowing the facts about what you’re trying to do, that’s where you set yourself up for not being able to make the right decision.
Laura Moreno: I see. I see. And what, what are you seeing in the market today in Nashville? I mean, are prices same? Is it a lot of demand? Like what’s going on with the sellers? I mean, you know, what do you know in the market about now what’s happening?
Lee Barroll: It’s shifting. Okay. Six months ago and probably for the previous 18 months, it [00:12:00] was crazy.
I mean, it, it was, you know, But it’s not anymore. So what’s happened is rates have gone up. Cash is backed out of the market to a certain extent. So houses need to be priced correctly. They need to be priced at the fair market value. You just can’t throw a price out there. Otherwise it’s gonna sit and, um, It’s shifting from a seller’s market where they were in charge of everything till now.
We see that buyers are getting back in the game as far as being able to negotiate concessions, negotiating seller paid title. Um, not quite, You’re not seeing 25 offers on a house that went on the market Friday by Sunday. Um, so there’s a lot more room. That being said in this area, if it is priced right and it looks good, it’s going to.
So a buyer still needs to be of a mind to negotiate. Cuz if you walk into that, that house and it fits 90% of your goals, you still don’t have three days to talk to Aunt Sally [00:13:00] about it. You need to be, you know, ready to make an an offer and then, um, move forward with that. So it’s kind of, it’s a lot better than it was from the buyer’s perspective.
From a recent standpoint. You still have to be in the position to buy if you wanna.
Laura Moreno: I hear you. I hear you. But, um, going back to the rates, I mean, if you are in a position that you want to buy, uh, but still the rates are like a little bit of a, you are like, you cannot really handle the rates. Like is there any creative ways of, um, reducing that interest rate?
Like if someone says, Listen, I want to buy Lee, but I don’t want a 7% interest rate, what options do they have? Is there anything they can. .
Lee Barroll: Yes. Um, there are several options that they do have. One is gonna depend upon the quality of realtor they’re working with and the realtor’s negotiation skills and understanding the market because, and, and, and well, I mean, yes, you can look [00:14:00] at, um, using discount points, lower the interest rate, which will lower your.
It’s gonna have a much higher impact on the larger loan amount than it is on a smaller loan amount. Um, and there’s also a product out there called a two one buy down where you can put money in escrow to lower the rate for the first 12 months, lower for the second 12 months, and then it would be the rate for the rest of life of the loan.
Um, so two, it’s called a two one interest rate buyout. Um, it’s not that complex, but let’s say that the start rate is seven. The first 12 months, the interest rate would be 5%. The second 12 months, the interest rate would be 6%, and then the third, 12 months through the third, through the third, uh, through the third year, through the 30th year, it would be 7%.
And so what they do is they take in that they take that interest between seven and 5%, and they put it in escrow and an escrow account, and every month they contribute outta that escrow account to make the payment whole at seven. [00:15:00] So if you can negotiate funds from the seller to pay that, then you’re way ahead of the game.
Um, and depending upon your goals and your plans, um, it still makes a lot of sense to do that if it’s gonna put the payment in the range that is affordable to you. And I don’t mean just from a numbers perspective, I mean from a comfort perspective as well. Um, and I don. I don’t wanna get too far off the path trying to explain it.
It’s just that there are options, but the key is determining how much money you have to work with. So just to put it in perspective, um, this is a loan that we have in the pipeline right now. It was a $530,000 purchase price. The realtor and the buyer negotiated $15,000 in seller concessions from, from the seller.
And then they decided to take that, um, entire $15,000 and. Into discount points to lower the interest rate. And they took the interest rate from [00:16:00] 7.375 down to 6.125, and on the loan amount that they had, that, that was almost a $350 difference a month. So yes, there are creative ways, but everybody has to understand what they’re they’re looking at.
And that’s why it’s so important to get with your loan officer in the beginning so you understand the numbers and you understand the TRA transaction and what your options. because then when you get into that home buying process, you have a much better feel for what it’s gonna look like. And, um, you’re not gonna be unpleasantly surprised.
Laura Moreno: That’s, uh, great news for home buyers because every, everyone is thinking about the interest rates. Everyone is like, Oh my God, what to do. Um, do you also recommend those arm mortgages, those like adjustable rate mortgages to lower the interest rate or That’s a little bit. , I’m
Lee Barroll: not saying it’s not tricky.
It depends upon the, the experience level of the buyer. Number one, what their plans are, number two, and what the benefit is. And right now, now, so I’m a loan officer for, uh, what’s called a secondary lender. And the loans that we’re talking about currently, [00:17:00] not the, um, are being sold on the secondary market to Fannie.
and Ginny. So that’s, uh, Fannie Mae, Freddie Mac and G Mae, Jenny Mae does the government. There’s not a real flavor on the secondary market for adjustable rate mortgages. So you’re not seeing a big difference on a conventional loan by going with an arm, if that makes an sense. And you mean
Laura Moreno: interest rates?
Like interest rates are not Okay. Okay. No, they would be,
Lee Barroll: No, they could be the same. Or close an eighth 0.125%. It’s not enough to move anything. Um, and so until that, until that changes, you’re really not gonna see a lot of benefit to doing an arm. But to answer your question, it depends on the person. Let’s say that I’m, um, senior level executive with Nissan.
They’ve transferred her to, uh, Nashville to take care of this job. I know that in three years I’m gonna be transferring back to San Francisco. Okay? I already know that Well, If it was beneficial financially, it would make great sense for me to look at a [00:18:00] five one R, you know, because I know how my life is going.
But if I don’t think that the risk warrants, um, the reward currently for especially a first time home buyer, just because there’s too much unknown going forward.
Laura Moreno: And a five one is you fixed their interest rate for five years, right?
Lee Barroll: I’m sorry, yes. five one is that the interest rate is fixed for the first five years and then in the 61st month it will adjust based upon, um, what the margin does, what the index does.
Excuse me. Um, so is just, Yeah, based upon, there hasn’t really been a flavor for arms since 2008 when we had the great recession. Experienced buyers, especially in the higher price point, will look at arms because they have a different, This might put, Inspective was a basketball coach, s e c, um, bought a $2 million house, knew he was only gonna be there two [00:19:00] years, so he looked at a, a three, one arm.
It made perfect sense for what he was doing. Um, but for the most part, and those are big numbers and I don’t know if that really answers the question or not. For the most part, a 30 year fixed. It’s gonna give you the opportunity to know what your costs for living are going to be through the term of that loan, and that’s something that you can use to make a good quality decision about your finances going forward.
Laura Moreno: That makes sense. That makes sense. And that’s why it’s important to have that consultation with you, like were you saying like a few different conversations Because what I’m, what I’m seeing is a lot of people going online, getting those mortgages online without even having a conversation. And that to me sounds a little bit scary because everyone is different and you may be missing into lots of really good products and insights because you’re just not having the, the conversation.
Uh, what are your thoughts?
Lee Barroll: I, Well, one of the things that I really like about my job is my, [00:20:00] uh, opportunity to interact with people on a pretty personal level. Um, I get a lot of information about them that people don’t generally get. I mean, it’s numbers and it’s specific to their, to their finances, but it gives us the opportunity to have a deeper conversation, and that’s the part of the job I really, really enjoy.
It’s. The mechanics of it, cuz the mechanics are pretty much the same every time. Does this fit yes or no? I have to make this fit, but my opportunity to get to know you on a deeper level is just, that’s, that’s the fun part of the job. You can’t do that through the internet. You can’t do that through text.
I respond to my clients the way they wanna respond. If they wanna talk through text, we’ll talk through text. We are gonna talk on the phone at some point during that transaction because we have to, There’s. , but most people like to be talked to, especially about this. And then we have Zoom too, where we can put a face to a name.
But, um, that’s, I mean, I don’t know if that answers your question or not, but that’s what I really enjoy about the job. That’s awesome.
Laura Moreno: Now I wanted to know, uh, [00:21:00] talk more about your practice, uh, your company and how you do loans. I mean, if I’m a first time home buyer looking to buy a home in Nashville, I get in touch with you.
What are you going to ask me? Like, what is the mortgage process for you? And the second question to that is like, why working with you is better to working with someone else? Like what are you, what are you the best at? Could be, maybe loans are fasters, faster rates are better, communication is the best.
Like I just want to understand how to work with you and why would I go with
Lee Barroll: you? Okay, so the process is this. My business is essentially referral based in my past client database. And so I will get a call, or I’ll be given the name and telephone number to reach out to someone and we’ll initially contact each other.
Now just look to, to open the conversation. So, um, this is great. What is it I can do to help you today? I mean, they’re calling me about a mortgage, but I’m asking ’em, how can I help you [00:22:00] today? Right. Um, and then we’ll talk a little bit about, and they usually tell me about what they’re looking to do or who referred on.
My mom told me that you were great and we’re really ready to move out of our apartment. And, uh, we were actually looking to see if we could find some place. It generally speaking. Then there dogs barking in the background. I’ll say, Oh, so you have a dog, And then we’ll start talking about their dog. Make them comfortable, Right.
Laura Moreno: because you also have dogs,
Lee Barroll: right? So, um, the objective is to get some simple information about what they, what, what they would like to see. Okay, we’re looking to buy a house. We think we, we wanna spend $400,000. We have about $45,000 saved and my mom’s gonna gimme another 15. So I think we have maybe $60,000 to put in the transaction.
Well, that’s great. I think that we have some opportunity there to talk to you a bit, and then I’ll have ’em fill out a secure application online. Um, I can either send them the link in a text or an email, and once they fill out that application, it’ll come directly to me. And then based upon. I have their initial conversation and because the biggest [00:23:00] thing in the beginning is pulling credit.
Mm-hmm. . Cause that credit has such an impact on what you can do with a mortgage loan. Um, doesn’t mean that if you credit is not superb, you can’t get a mortgage loan. You can, but you just need to have that information. Um, and then I’ll put together the proposal based upon what we’ve discussed, and then we start the convers.
So then we have the conversation. I review the proposal with them. I ask any questions that they have at that time. I send ’em the worksheet and then we set a follow up call so that I can go through the worksheet with them. I’m looking at it on my side. They’re looking it on their side. And I can answer their questions about what the numbers mean.
But what’s this for? What’s that for? Um, and make sure cuz, because really what I want to focus in on is that as they go through the process, there’s, it’s gonna come down to two things. The first thing is, what is my total monthly housing expense? How much am I gonna write my check? Okay. And the second thing is, what is my cash to close?
How much do I have to bring to closing? So I wanna make sure that they understand how we’re getting there and what that means, so that when they call me up on a Saturday afternoon and [00:24:00] said, I just went to look at 1 23 Smith Street. We wanna make an offer at $600,000. What does that mean? Oh, well, that means that your payment’s gonna be 32 23 16, and it looks like your cash to close is estimated at, uh, 83 7 80 3,600.
You know, and they know what that means. They know that’s what I’m gonna write my check for and that’s what I come to closing. So, um, we focus on getting to that fundamental understanding of what it means with those numbers going forward. So then they, we go under contract, then we have another call. We go over what the current interest rate is, locks through their closing.
Um, during this time we’ve collected supporting documentation as far as their income and their assets. Uh, the income to validate the debt to income ratio, which is the for affordability of the loan and their assets to validate where the cash to close is coming from. Uh, Once it goes under contract and we’ve locked the rate, then I hand it off to my staff.
I have a, I have a loan partner that I’ve been working with since [00:25:00] 2013. Her name is Laura, and what she does is she takes over the loan file at that point in time and she works directly with the client to make sure that we have all of the supporting documentation that we need, current that we’ve collected for the appraisal.
We’re ready to order the appraisal and order the title work. Once she has all that together, then we’ll hand it off to our process. Our processor’s, the one that works directly with the underwriter to get loan approval. Um, typically at the beginning we’re looking for a conditional approval, and then once we have all the documentation, any questions that the underwriter might have, the appraisal and title work, we go for a final approval and then we can schedule the closing.
Um, with the company I’m with now, Cardinal Financial, they have fantastic technology and literally we can close alone in as little as 14. As long as people are paying attention and that can come into play. If the seller is looking for a quick close, um, that becomes very important. Uh, there was another thing I wanted to say about that whole process and [00:26:00] left my mind and um, Okay.
Sorry about that.
Laura Moreno: No worries, No worries. Kon.
Lee Barroll: Yeah. Yeah. Um, there was a second part to the question, the process, and you asked. Why would they should work with me? I don’t know that they should. Okay. I’m a good loan officer. Um, I’ve been at, in the top 1% of originators in the country based upon the information they can track from the nmls Wow.
Which is the National Loan Mortgage Registry. Um, but that doesn’t mean they, they said they have to work with me. They may not like. , You know, I may not like them. I want people to work with me, but I want them to want to work with me. Why? They should work with me. Um, I’m gonna tell ’em the good and the bad from the beginning.
Laura Moreno: who works the bad? I’m curious. I mean, you seem, you seem really, really good. I’m like, what’s the bad? I mean, ,
Lee Barroll: um, it’s not gonna work out the way we talked about because this showed up, but we can do this. There’s this expression that bad news doesn’t get better. All right. [00:27:00] And that’s one of the reasons why my realtors like me, is because if we have a problem, they’re gonna find out about it as soon as I do, because then we have a chance to fix it.
And the same is true with the borrower. If there’s an issue, let’s see what we can do to fix it. Let’s not just hold onto ’em. So that’s what I mean by the good and the bad. Um, and, uh, I mean, I think I’m a great loan officer. I think I’m a great guy, right? But not everybody does. So, I know that there’s a lot of really good loan officers out there, and people do have a really, uh, they have the chance to choose, but they need to take some time to investigate the person they’re working with.
Are they getting a personal referral from, from other they trust? Like if it’s your, if it’s your dad and he’s worked with me on three 10 s, he’s telling you I’m the greatest guy in the world. You should probably listen to him. You know, that would be great. Um, but there’s also other resources. There’s the.
You can type my name in the internet and there’s all kinds of stuff that’s gonna come up about me. Most of it’s good, [00:28:00] okay? So I’m not really afraid of somebody doing that . But no, do your due diligence. Find out what you can about this guy. Same with your realtor. Cause this is important stuff. Um, you need to know the, to, to the extent you can.
You need to know the person that you’re working with. You need to feel comfortable with them. If at any point in the transaction, you don’t have to use anybody, you’re the consumer. It’s your right to choose. And if at any point in the transaction you feel uncomfortable, you need to call it. Number one, and if you feel you need to move to somebody else, move to somebody else.
But I still think you like me best .
Laura Moreno: I I’m sure you will. I mean, I love that you’re so personable and you’re so funny, . That’s, that’s a lot of fun. One quick question. The last question before we go Lee, is what have you seen are the top mistakes that home buyers make and how can they avoid them? I mean, what have you seen are the craziest things that you’ve seen that you’re like, Oh no, why would they.
Lee Barroll: Listening to a non-real estate professional is probably the number one thing. Okay,
Laura Moreno: give me an example. I’m curious. ,
Lee Barroll: Aunt S. Okay, so [00:29:00] when you go to buy a house, everybody, it’s this aura, this reciprocity that goes out. Everybody all of a sudden finds out you wanna buy a house, and then they want to give you advice and they mean well, but they don’t know what they’re talking about.
And my example is Aunt Sally, she bought a house back in 1993. And now she’s gonna sit you down and she’s gonna tell you exactly what you need to know about buying a house. Well, Aunt Sally’s not a mortgage professional. She doesn’t know what’s going on. So listening to somebody who’s not involved in the transaction, that’s not a professional in that industry is number one.
Number two is not talking to your loan officer. There’s an expression, it’s called, you can’t put the toothpaste back in the tube once it’s out. So , I’ve never, Yeah, well, it’s, it, it, you know, um, I can give you an example in just a second. One of the things that I tell my borrowers up front is, Look, I’m your advocate.
I work for you. Me and Laura, we work for you. We’re on your side. So if something’s going down, you need to tell me what it is because there’s always an easy [00:30:00] way to do something and a hard way to do something. And if we have to do something, we wanna do it the easy way. So that’s the toothpaste outta of the tube, for example.
Um, mom wants to help ’em out, so mom gives ’em $5,000 in. Well, no, because we can’t use that because you cannot source and season cash. And the thing that you have to show is that there’s no unsecured borrowed funds being used as part of the transaction. And if it’s cash, you can’t do that. Whereas if they said, Hey, mom wants to gimme, um, uh, a gift to help and, and she’s wants to gimme cash, I’ll say, No.
Mom needs to put it in her. And we need to get a gift letter and then she can just wire it directly to title company and then there’s no questions about it. We’re not trying to fix something that’s really hard to fix, even though it’s the same thing. Mom is still giving them the money to help with the closing costs, but there’s an easy way to do it and a hard way to do it.
So that’s, that’s a big deal. It’s not being, cuz you know people are smart and they think they’re smarter than every. [00:31:00] And so that’s very frustrating and, and it causes problems. And then, um, probably the other thing is the spending money or buying stuff in the middle of the transaction or changing jobs.
It’s not that you can’t spend money, It’s not that you can’t buy, do, um, stuff. It’s not that you can’t change jobs, it’s that you need to talk to your loan officer before you do anything to make sure it’s not gonna have a negative impact on your transaction. So it’s really all about communication.
Laura Moreno: So it’s basically you are.
I wanna say my priest because, um, I was born . I was like Catholic student. Like you are my, I’m thinking about confession priest. You, you, you are my confessor. I have to go to you and say, I’m going to do this. Is this okay? For the three months that the transaction takes, the two, three months, whatever it takes.
I’m thinking about doing this. Should I do it? Lee ?
Lee Barroll: Yeah. Well, I mean, if you wanna buy the house, I mean, it’s all about the whole, The whole goal is to show up on X day, sign the paperwork, and pick up the keys. [00:32:00] You know, that’s what we’re trying to do. A person like me has done this for quite some time. We’re pretty good at it.
We know what to do. Someone specifically as first time home buyer doesn’t really, they need to be guided, but they also need to be guided by somebody that they like and trust. There’s no reason to go through this with somebody you don’t like and trust. Cause there’s too many to choose from. That’s, That’s my opinion.
That’s my take on
Laura Moreno: it. I like that. I like that so much. Well, Lee, you’ve shared with us amazing information today. What can we do for you? How can we help?
Lee Barroll: Well, I know that you’re gonna post my contact information out there and I just want you to know that if you have any questions, um, if you have any questions about the mortgage loan process or what you need to do to put yourself in a position to buy a home, either in the near future or the long term, I would like to be your resource.
I would like the opportunity to get to know you and see what we can do to help you achieve your goals as it relates to home.
Laura Moreno: Awesome. Well, Lee, thank you so much for being the first Time Home podcast. Before we go, how can [00:33:00] we get in touch with you, share with us spoken because many people are listening to the podcast, Share with us how we can get in touch with you.
Lee Barroll: Well, you can call me or text me at 6 1 5 2 4 3 1 3 0. Which is my cell phone number. It’ll always be my cell phone number unless I hit the power ball, in which case you’ll get, you know, disconnect numbers. ,
Laura Moreno: always talk to my husband. He’s so disappointed he didn’t win the two. Oh, I know. Power balls. He’s so disappointed.
I’m like, come on, .
Lee Barroll: Alright. And I’ll get back to it, but lemme just get over that, that, yeah. Anyway, so, um, caller text or, um, you can reach me through my. Which is http://www.team t e a m barrel, B as in boy, A r r o l l.com. And that’ll take you to a site where you can reach out to me, you can set an inquiry, you can file loan application.
Um, but I would love to, uh, I would love to be your [00:34:00] resource. Really. That’s my goal. Well,
Laura Moreno: thank you so, so much for Lee for being the first time home by podcast. You are awesome. Thank you