Adam Tabaka (00:01):

I’m joined today by the one and only Rob Clark with Guaranteed Rate Affinity. Rob does a fantastic job serving everybody that he works with, and so Rob, give us a little introduction and a little bit of backstory about yourself right now, please.

Rob Clark (00:15):

Sure, Adam, great to be with you here and glad to join and give you some information today. So a little bit about me is I’ve been a mortgage lender for 33 years. I would say that I specialize in VA and conventional loans. That’s what we see most of. And I’d say probably 80% of what I do is going to be one of those two types of loans. We do a couple hundred loans a year and have for a lot of years. And so I’ve got, I think it’s about 4,500 loans in my career that I’ve done totaling a couple billion dollars in business that we’ve closed. And it is a fun thing for me to do still 33 years later. I mean, each transaction is, it’s like a big jigsaw puzzle. I view it and it’s like putting together the pieces the best way possible for the client is our end goal.

Adam Tabaka (01:09):

Yeah. Well, so with that kind of experience, I’m sure you’ve seen it all. Generally speaking, what do you think are the biggest maybe misconceptions that buyers have about the mortgage process?

Rob Clark (01:21):

Good question there. I’ll give you two because I think there’s two. The things that I hear most often and I would say are the biggest misconceptions. The first one is that you’ve got to have a 20% down payment, not true. There are programs that will allow for three, three and a half percent as a down payment. There are different down payment programs, down payment assistance programs, grant programs, those kinds of things that also exist. So very often the buyer in a VA loan said earlier about VA loans. They don’t require any down payment at all. So 20% down is not a needed amount.

(02:00):

The other big misconception is that in the conventional loan world, many of you may have heard of what’s called PMI or private mortgage insurance. For whatever reason, when people look at stuff online, the dollar figures associated with the PMI amounts are oftentimes way higher than what they actually turn out to be. When you have a buyer say buying a property for five or $600,000, putting down 5%, and if they’ve got good credit, the mortgage insurance may only be $150 a month or less. And so very often people are like, wow, that’s all it is. They thought it was going to be six or seven or $800 a month, which is what I’ve seen in a lot of the online computations as well. So that would be the other big misconception.

Adam Tabaka (02:45):

So you’re telling us that everything that you rate on the internet isn’t true? Is that

Rob Clark (02:50):

Shockingly, yeah, that is what I’m saying, especially in the real estate and mortgage world. I know that you’re going to find that very, very hard to believe too.

Adam Tabaka (02:58):

Yeah, yeah, absolutely. So what would you say are some of the biggest mistakes that you commonly see being made by prospective buyers who are looking at the process?

Rob Clark (03:11):

Yeah. I mean, I think that I get asked the question on what do I qualify for very early in the conversation often. And I think that that’s probably the biggest mistake because what’s going to almost always happen is you’re going to qualify for more than what you’re going to be comfortable with. And I always tell everybody that one of the first things that they need to do before we even get into the consultation call that we’re going to do as we start, after you get the preapproval data from the client, you’ve got to figure out what’s going to work into your budget. I can look at it and based on guidelines that we have, I can tell anybody what the maximum amount is they qualify for. But certainly more than nine out of 10 people that I talk to, it’s going to end up where they’re going to qualify for more than they’re going to tell me that they’re comfortable spending.

(04:00):

And I think that there’s almost always going to be a range that people are going to feel it’s going to be acceptable. But you’ve really got to think about that. And I always put people to task and say, figure that out. And then once we have our consultation call, it’ll be a lot better of an end result. We’re going to have an amount that’s going to be what you’re comfortable with. We’re also going to know what that top number is that you qualify for. And then that way you’ve got a full view on where you stand. And I think if you can effectively go out and start looking at homes with your agent then

Adam Tabaka (04:32):

Now, what are some of the most common challenges that prospective buyers you work with face and how can they best overcome those challenges?

Rob Clark (04:40):

So when we look at a loan, there’s a lot of filler material, but at the end of the day, there’s three basic components to it. It’s the person’s credit history, it’s the person’s debt to income ratio, and it’s how much money does that person need to buy the property based on the financing type that they’re going to end up doing. This is, again, a similar number to what I just said. It’s going to be like 90 to 95% of the buyers when they have a challenge, it’s going to end up being that they don’t have enough money to buy what they want to buy. I mentioned before that you need three or three and a half percent as a down payment. We’ve got lots of million dollar properties in our area. And so you start looking at a million dollar property and say, 3% doesn’t sound like much.

(05:25):

Well, it’s $30,000. And then you’ve got another 20 or 30 or $40,000 potentially in closing costs, and all of a sudden somebody’s got to have 50, 60, $70,000. And although it’s not 20%, it still is a pretty big chunk of money. And so that’s the area where I see people most often having a challenge when they do have a challenge. Like I said, most people are going to qualify for more than they’re comfortable with. So it takes care of that one piece of it. And either you have good enough credit history or you don’t. And most of the people that we see that are looking to buy realize that they’ve got to have sufficient credit history, and most people do.

Adam Tabaka (06:02):

Good stuff. Good stuff. And then wrapping up here, in your experience, what habits and actions do you notice that maybe separate successful buyers from prospective buyers who don’t maybe ever make it over the hump?

Rob Clark (06:17):

That’s a good question. So I would say the first thing is pay attention to what your realtor is telling you to do. The market that we have here it moves quickly and changes quickly, and it’s really individualized for property by property. And you could be looking at two properties on a weekend where one of ’em, there’s going to be 15 offers on it, and the next one, it’s been in the market for two weeks and a month and nobody wanted to buy it yet. And the strategy that you’re going to take with each of those two scenarios is going to be vastly different. And what I can tell you is that I hear it from people often. I know that you do and that there are, for whatever reason, when people start buying houses, everybody wants to help. And so you end up where coworkers, friends, family, everybody’s giving you advice on what you should do and how to do it, and everybody wants to help but understand that when somebody buys a property once every 10 years or buys property in other marketplaces, that they don’t really understand how it might be here.

(07:31):

And that at the end of the day, both your lender and your agent are really just trying to work with you to give you the best opportunity to getting what you want. And so just pay attention to what we’re telling you. We’re not doing anything that’s self-serving. We’re probably going to, in many cases, tell you stuff that may not be things that you necessarily want to hear, but there are things that you need to hear that we feel that you need to know so that you can make an informed decision and the best decision as you move forward with the decisions you need to make between now and when you do ultimately buy a home. So that’s number one. Absolutely. Just find somebody that you feel like you relate to and listen to what they tell you to do, and you’ll be led down the right path and end up with a real positive buying experience.

Adam Tabaka (08:20):

Excellent advice as always, Rob.

Rob Clark (08:22):

Sure.

Adam Tabaka (08:23):

Thank you very much.

Rob Clark (08:24):

Absolutely.

Adam Tabaka (08:26):

So if you want to connect with Rob, check out his link below. He’s going to give you great advice and schedule time to have a call with him and see what he’s got to say. Thanks again, Rob. Appreciate it.

Rob Clark (08:36):

Thank you, Adam. Appreciate your time today.

Adam Tabaka (08:38):

Alright. Take it easy

Rob Clark (08:40):

You too.