HIGHLIGHTS FROM TODAY’S PODCAST:
MARKET NEWS
I SHARE AGENCY SOCIAL MEDIA TIP OF THE DAY FOR REAL ESTATE PROFESSIONALS
QUESTIONS ANSWERED BY JANA CARDONA:
- Please tell our audience about Business Networking International BNI.
- What are some specific benefits BNI can offer business owners or sales people?
- Can you share a BNI success story?
- What is happening with your additional venture with Referral University?
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QUESTIONS ANSWERED BY DICK WITTENBURG:
- What are some of the main points a business banker looks for when considering a lending request from a business owner?
- As a business banker, what are some pointers you can give business owners who are preparing their paperwork to meet with their bank for a commercial loan?
- What are some common loan types and terms that you offer business people?
- Talk a little about the Small Business Administration loans.
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QUESTIONS ANSWERED BY JO GARNER:
- Where do you go to find money for down payment and closing costs?
- How can you convert Bad Debt into Smart Debt to save yourself the most money? (Not covered on the air)
REAL ESTATE TIP OF THE WEEK (iShare Agency’s Social Media Tip of the Day by Jana Cardona)
ANNOUNCEMENTS
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Good morning Memphis! Good morning across the country on iHeart Radio and BOCI Radio. You’re on the Real Estate Mortgage Shoppe program. I’m your host, Jo Garner, Mortgage Officer with Evolve Bank and Trust. Today our general topic is “MAKE YOUR MONEY TALK—GETTING COMMERCIAL & RESIDENTIAL FINANCING.” If you have a story, a comment or question concerning YOUR commercial or residential real estate or real estate financing, call us on the air and let’s talk about it. Someone, somewhere in our listening audience will be out there thanking you. Call us on the air at 901 535-WREC –that’s 901 535-9732.
Sitting across the coffee table with us today we have Dick Wittenberg, Business Banker with Evolve Bank and Trust and Dick has had over 30 years experience in the commercial lending business. If you have a question about a business loan or commercial real estate loan, he’s the guy that can help you. Dick Wittenberg, its great finally getting you on the show. Tell our audience a little bit about yourself and what you do at Evolve Bank and Trust. <Dick talks about what he does at Evolve Bank>
(Jo) We have another very distinguished guest joining us for coffee this morning. We have iShare Agency expert, cofounder of Referral University and also Executive Director of Business Networking International, Jana Cardona. Now if there is ANYONE who keeps her finger on the pulse of small businesses and sales people—at least their MARKETING needs—it’s THIS lady. Jana, please tell our audience a little bit about yourself and BNI. <Jana talks about what she does at BNI and what BNI does for business owners and sales people.>
(Jo) We’re going to be hearing more from Dick Wittenberg and Jana Cardona throughout this show, so you might as well pour yourself another cup of coffee or tea and drag up a chair with us.
This week mortgage rates stayed stagnant despite the volatility going on around it—kind of like an old hound dog, too lazy to roll over no matter how much excitement is going on around him. Conventional rates ended the day yesterday at – 3.625-3.75% with the conventional 15 year rates coming in around 3-3.125% no points. Evolve Bank is still offering their Jumbo mortgage rates in the upper 3’s to low 4’s—that ‘s for loans over $417K. Rates do vary depending on a number of factors and these are with close to no points, but you could get a lower rate. Evolve also offers FHA , Veteran loans, Rural Housing loans, renovation and repair loans, and more .
My assistant, Susan Belew, and I have seen a lot of people coming into our office or calling us on the phone to talk about purchasing a home or refinancing one. Some of our clients who are making offers to buy a house keep running into multiple offer situations where there is more than one person making an offer on the house at the same time. If you want a better chance of getting your offer accepted, give me a call. Susan and I have been getting our clients’ bank statements and income documents and reviewing them, along with credit so we can say on the preapproval letter “Credit, Assets and Income has been reviewed.” We actually had a client that just closed. She made a lower offer than the other person making an offer on the same house, but the realtor said at closing that the sellers accepted their lower offer because the income, credit and assets had been approved and they were looking for a SURE thing and not just the highest bid. So if you really want to make your money talk, get your income and asset documents reviewed by the loan officer BEFORE making your offer. Susan and I would like to work with you—whether you are refinancing, buying a house or looking at converting Bad Debt to Smart Debt, we can put together some financing scenarios for you to consider and we work in Memphis and ALL OVER THE COUNTRY too. Make Your Plan, Work Your Plan. If The Deal Works For You Today, Do It Today Call us on the air at 901 535 WREC or directly at 901 482-0354 901 482-0354 or connect with me at www.JoGarner.com
(Jo) Dick, what are some of the trends you are seeing right now in the commercial lending office? <Dick talks about trends he is seeing in the Memphis commercial real estate lending business>
<Jana made comments about what trends she is seeing on small business sales activity>
(Jo) We’re talking about MAKING YOUR MONEY TALK-GETTING COMMERCIAL AND RESIDENTIAL REAL ESTATE FINANCING. One the residential side of real estate lending, most mortgages are underwritten first by a computer that grades the risk layers on credit, assets, income-to-debt ratios and value on the subject real estate property. Out of all of these factors, the two MOST important ones are credit and assets. So many people will call me up and say “hey, I have paid off my credit cards and now I am ready to come get qualified for a mortgage.” That might be fine for that borrower, but its usually better to consult with the mortgage officer first before paying down any debt. The computerized underwriting system puts a much higher priority on the amount of reserve cash you have in the bank more than having a lower income-to-debt ratio. The reasoning is that if you fell on hard times, if you have money in the bank, you can always pay down debt and lower the debt ratios if you needed too. So the highest priority is to show assets in the bank—the more the better—even if you are using a program that doesn’t require much money down. One of my clients I am working with now needed to show more money left in her bank account as cash in case of emergencies. She usually made higher than minimum payments each month on her credit cards, but in order to show more cash in the bank for emergencies, she temporarily went back to paying the minimum payment required for a while on her revolving credit cards just to give her a chance to show more cash for emergencies.
Dick Wittenberg, you have been a commercial lender for over 30 years. What are the most important factors a client needs to show if they are applying for a business or commercial loan?
<Dick discusses the most important priorities and documents that are important to bring to the commercial >
- 2nd SEGMENT Of Show iShare Agency SOCIAL MEDIA TIP OF THE DAY (background music “Roar” by Katy Perry
_________________________________________________________________________ - To our realtor friends and other savvy and sharp business friends out there, its time for the iShare Agency Social Media Tip of The Day for real estate professionals. Jana Cardona is an iShare Expert and she’s also the Executive Director of Business Networking International (BNI). Jana Cardona, what’s our social media tip of the day? <Jana shares iShare Agency tip on the important of being specific about reaching your exact target market segment>
QUESTIONS ANSWERED BY JANA CARDONA:
- Please tell our audience about Business Networking International BNI.
- What are some specific benefits BNI can offer business owners or sales people?
- Can you share a BNI success story?
- What is happening with your additional venture with Referral University?
Notes about BNI from Jana Cardona- For a business team so you can not only recieve referrals, but also be a HUB for your clients — providing them trusted professionals who offer services you don’t, but that they need. Makes you a more valuable resource to them and they typically won’t “shop” you looking for a lower price.
There is one person per specialty on your team, so you don’t have to compete with someone else for business.
This team comes to trust you, and therefore validate you to their clients and friends. We are twice as likely to believe our friends, and then 4 times more likely to purchase when something was recommended. Plus retention of that referred client is 16% higher.
You not only are able to receive referrals, but, becaues they become your friends as well, you can receive help and support, business advice, etc
QUESTIONS ANSWERED BY DICK WITTENBURG:
- What are some of the main points a business banker looks for when considering a lending request from a business owner?
- As a business banker, what are some pointers you can give business owners who are preparing their paperwork to meet with their bank for a commercial loan?
- What are some common loan types and terms that you offer business people?
- Talk a little about the Small Business Administration loans.
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QUESTIONS ANSWERED BY JO GARNER:
- Where do you go to find money for down payment and closing costs?
Gift From Family: Gifts can come from family members or employers. The amount of the donation varies according to different loan programs. The donor will be required to document the source of his funds and that the money is a gift to the donee not requiring repayment. If the family member giving the money does not want to cash in a certificate of deposit or stock fund, he can borrow against the asset to give to the donee.
Borrower’s Forgotten Assets: Whole life insurance policies or annuities may have a cash value that can be borrowed. Many times the borrower does not realize the insurance she purchased years ago has a cash value that can be borrowed to pay the move-in costs.
Loans secured on certificates of deposit, stocks and bonds, and durable assets such as cars can be used as acceptable sources of funds to close as long as the loan is secured on an asset owned by the borrower. The payment must be added into the debt-to-income ratios for qualifying purposes
IRAs, 401(k)s and Retirement Funds. There can be heavy financial penalties for pulling money from these sources. However, many companies allow the homebuyer to borrow against these assets with no penalty. The repayment terms may be calculated in the borrower’s debt-to-income ratio.
Sale or Cash Out Refinance of Existing Real Estate Property can generate needed funds to close on another property. Lenders will require the HUD 1 Settlement Statement or sufficient proof of the source of funds.
Tax Refunds can provide a surprising source of closing funds.
Move-In Costs Paid By Third Parties: Sellers are as motivated to sell a house as the buyer is to purchase. Sellers can pay up to 3% of the sales price toward the buyer’s costs if the borrower is getting a conventional loan above 90% loan-to-value. If the loan-to-value is 90%, the seller is allowed to pay costs up to 6% of the sales price or value whichever is less.
On certain loans, the sellers are allowed to pay more and even loan the borrower the equity on a second mortgage. Investor loans allow the sellers to pay no more than 2% no matter how much money the investor pays down.
FHA loans allow the seller to pay up to 6% of the price toward the buyer’s closing costs and prepaid taxes and insurance.
Lenders are motivated to close the transaction and sometimes can bump up the interest rate slightly in order to use “premium pricing” to pay the borrower’s prepaid taxes and insurance or some of the closing costs. In most cases the rate is increased .25% and the difference in the monthly payment is minimal.
Government agencies such as Tennessee Housing Development Agency have programs that provide down payment assistance to borrowers. Some of the well known programs are City of Memphis Down Payment Assistance, Shelby County Down Payment Assistance, United Housing, Inc. Rural Housing, Mississippi Bond money, H.E.L.P. For the down payment assistance grants and loans, the borrower is required to meet a minimum or maximum annual income guideline and sometimes are required to be first time homebuyers. First time homebuyers are defined as buyers who have not owned real estate in the last 2 to 3 years.
Optional true story— When bankers talk about the difficulty to verify source of funds for closing, I chuckle when I remember one of the first loans I ever closed. It was a family building a nice home with a very large down payment. “A piece of cake. This will be easy,” I thought.
Much to my chagrin, the underwriter asked for a paper trail showing the source of funds the family was using for down payment. When I asked my borrowers where they got the large down payment, they replied, “We found buried treasure.” I laughed thinking they were joking. They weren’t.
When their great-grandfather enlisted into the Army during the Civil War, great-grandmother buried the family wealth under a tree on their property intending to dig it up after great-grandfather came back from war. He didn’t.
Great-grandmother, for whatever reason, did not dig up the treasure after the war and eventually the old tree came down leaving no marker for the family.
Great-grandmother was finally laid to rest and a few of the family members
began searching for a map that surely must be there. It wasn’t.
Not until several years later when the family began clearing ground to build their house on the inherited property did the back-hoe turn up the surprise. Their part was over $20,000 dollars and was discovered still securely contained where great-grandmother had buried it during the Civil War.
- How can you convert Bad Debt into Smart Debt to save yourself the most money?
Last week we talked about the secrets of converting Bad Debt to Smart Debt. Smart debt is debt that earns you a greater return than what the investment cost. Here is an example of a debt that works FOR you and not against you— I shared a story about customers who had come into my office. Due to a family crisis or job loss, they had racked up credit card debt of over $35,000 that now carries double digit interest rates. Their house is now valued at about $200,000. They owe $100,000 on the first mortgage with a rate of 5.5%. We refinance the house, pay off the $100k first mortgage and the $35K in credit card debt . The Principle and interest payment on the existing first mortgage was $852/mo and on the new loan amount of $135,000 with the lower rate in the high 3’s, the new principal and interest payment is $635/mo—–$217/mo less than the old payment. Not only can we reduce the first mortgage payment by over $200/mo but because we paid off the credit card debt of $35,000, we also eliminated over $1,000 per month in credit card debt. The MOST important secret to KEEPING this refinance arrangement as Smart Debt and not bad debt is the fact that the family crisis has passed and no more debt is being accrued on the credit cards.
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REAL ESTATE TIP OF THE WEEK: (Jana Cardona shares the social media tip of the week again.
Announcements: Talk Shoppe offers free education and networking to anyone interested in real estate or in business. This Wednesday April 22nd 9A-10AM at the University of Phoenix 65 Germantown Court Cordova, TN (across from
The Butcher Shop), Shelley Baur, One Source Associates leadership development,speaker and author, will be presenting “Get Hired! Success Tips
Interviewing Skills, Resume Writing and More…” For more information about Talk Shoppe, go to www.TalkShoppe.com
To hear this podcast from today’s show and more, go to www.JOGarner.com
Make Your Plan, Work Your Plan. If The Deal Works For You Today, Do It Today. See you next week!
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Transactional Songs: I’m A Hard Working Man by Brooks and Dunn
The Money Song by the Muppets; Big Time by Peter Gabriel ;
“Roar” Katy Perry
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ABOUT JANA CARDONA
Jana Cardona is an expert in referral marketing. She is a passionate speaker, workshop trainer and leader in the areas of networking, business referral development and relationship building.
Jana is a 10 year Executive Director of Business Network International (BNI) Mid-South. BNI is the world’s premier referral marketing organization with over 7000 chapters in 60 countries. Under her tutelage, members in her region added well over $23 million in revenue from referrals to their personal businesses in 2014.
In addition to her role with BNI, she is co-founder of The Referral University. Trainings are designed for both the entrepreneurs and the business owners who wants to drive business through referral.
Jana has developed a speaking and training platform that assists individuals and companies in designing an intentional referral marketing business plan. Most individuals network haphazardly rather than by design. They don’t realize they need to develop a strategic plan before they walk out the door.
Important elements in this strategic plan include identifying ideal clients and the situations they experience, and then what makes them call you. Since it pays to work smarter, not harder, she also guides you to identify referral partners and strategic alliances who can drive a steady stream of those clients to your business.
Attendees at her keynotes, workshops, and seminars are better able to bridge the gap between merely networking casually to creating a language for referrals that will attract their desired clients.
A natural mentor, Jana brings a passion for teaching and exemplary skills as a communicator to her coaching practice. She not only focuses on what steps people need to take to become better at networking, but how to truly leverage relationships for the greater good.
Build Your Team Achieve Your Dream
Jana Cardona
Referral Marketing Coach / Trainer
BNI Executive Director,W. TN; N. MS
901-634-7419
www.BNIMidSouth.com (Local Site)
ABOUT DICK WITTENBERG, BUSINESS BANKER EVOLVE BANK & TRUST
30+ years commercial lending experience in financing; working capital lines of credit, fixed asset acquisition, residential and commercial real estate.
Dick Wittenberg
Senior Vice President
Evolve Bank & Trust
6070 Poplar Avenue, Suite 200
Memphis, Tennessee 38119
901-260-1459
dwittenberg@getevolved.com
ABOUT JO GARNER:
www.JoGarner.com (901) 482 0354 jo@192.232.195.219 on twitter @jogarner
Jo Garner is a mortgage officer with extensive knowledge in tailoring mortgages to her customers who are refinancing or purchasing homes all over the country. She offers conventional, FHA, VA or other loan programs for refinancing and purchases.
Jo can help you look at rent vs buy, when it makes sense to refinance, how to get the best deal on your home purchase financing.
Jo Garner has been in the real estate/financing business for over 20 years. She got her start in Portland, Maine where she first began her real estate career. She received her real estate education from the University of Southern Maine and was personally mentored in San Diego, California by Robert G. Allen, author of Nothing Down, Creating Wealth and The Challenge.
On moving back to West Tennessee in 1987, she went into business buying and selling discounted owner-financed notes secured on real estate. In 1990 Jo went to work for a residential mortgage company and has been a mortgage loan officer for over 20 years. Her goal is to offer excellent, affordable service to her customers, tailoring the loan programs to the specific needs of her clients.
In addition to her work in the mortgage field, Jo Garner is the primary sponsor and founder of Talk Shoppe in Memphis. www.TalkShoppe.com She was also the editor of Power Shoppe, a free weekly e-zine designed for real estate professionals and others indirectly connected to the real estate industry and currently publishes on her blog www.JoGarner.com .
For real estate financing solutions, plug into the Real Estate Mortgage Shoppe program. You can find mortgage rates, FHA Streamline refinance with no out-of-pocket costs, refinancing options, home purchase loan programs, answers and real estate, money-saving tips and more.