2018 BiggerPockets Member Survey Results: 79% Completed a Real Estate Deal (& More!)

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Expanding the BiggerPockets message and producing the best real estate investing educational content on the internet is thrilling. But we wanted to know how well our members are actually doing in real estate—what strategies you’re executing and how that changed in 2018—so we asked!

View the full article: 2018 BiggerPockets Member Survey Results: 79% Completed a Real Estate Deal (& More!) on The BiggerPockets Blog. This content is Copyright © 2017 BiggerPockets, Inc. All Rights Reserved.

Properties Typically on the Market for Longer Days in November 2018

In a monthly survey of REALTORS®, respondents reported that properties were typically on the market for 42 days (36 days in October 2018; 40 days in November 2017), according to the  November 2018  REALTORS® Confidence Index Survey.[1]  Properties are staying longer on the market due to slower demand with mortgage rates rising and with new home construction steadily, though modestly, rising.

During September–November 2018, properties typically stayed on the market for 31 to 45 days in California, Oregon, Arizona and Texas, a slower pace compared to less than one month in previous months (Map 1). However, properties continue to sell in less than 31 days in the District of Columbia (28 days) and in 16 states such as Washington (28 days), Nevada (28 days), Utah (23 days), Colorado (26 days), and Massachusetts (27 days).

 

Properties typically stayed longer on the market in September-November 2018 compared to the same period in 2017 (blue areas) in the District of Columbia and in 22 states such as California, Washington, Oregon, Nevada, Colorado, Massachusetts, and Texas (Map 2).

Properties are staying longer on the market due to the combination of lower demand and the steady increase in new home construction.  In states such as California, Oregon, Colorado, Texas, Virginia, North Carolina, and South Carolina, the number of building permits increased during November 2017-October 2018 compared to the prior 12-month period (Map 3).  


[1] In generating the median days on market at the state level, NAR uses data for the last three surveys to have close to 30 observations. Small states such as AK, ND, SD, MT, VT, WY, WV, DE, and D.C., may have fewer than 30 observations.

How to Handle 11 Common Objections in Real Estate (Scripts Included)

Can you imagine buying a house without any hesitations or questions? There’s probably a thousand things swirling in a person’s mind when considering a real estate decision. It’s the source of many objections you hear. And no doubt, it’s challenging to deal with their resistance on a daily basis.

To improve your odds at converting real estate leads, we’re going to focus on one word: Commitment.

The goal isn’t to get someone to commit to a huge decision, like buying a house next week. That’s asking way too much! Instead, you want to get them to commit to something small and easy. And oftentimes, this means simply continuing the conversation – rather than letting a hard objection put a “no” in your discussion.

To get a lead committed, let’s go over a few steps to navigating tough conversations. And then I’ll share my favorite scripts for answering 11 of the most common objections in real estate.

 

Steps to Navigating Tough Conversations & Overcoming Objections

When handling objections and managing tough conversations, the last thing anyone wants to feel is like they’re being attacked. You’re not a battering ram beating at the castle gates.

To keep people from getting defensive, and to offer you the opportunity to persuade, use the LAER model: Listen, Acknowledge, Explore, Respond. These steps are common techniques used in debates, and are often used successfully by top salespeople in other industries.

Make your pitch and offer your services, but let your lead talk and voice their objections. Acknowledge their resistance as a valid point and then explore the underlying reasons for what they’re saying. Ask questions and dig into their mindset a bit. This also allots some time for you to gather your thoughts versus answering right away.

Then recommend a solution to their objection. Or a counterpoint. Remember, you’re not trying to “win.” You’re trying to solve their hidden pain points and make them feel confident. Show them you’re there to help, not push.

Because you listened and explored their perspective, they’re more likely to hear you out. And by that, you’ve gained a little bit of commitment from them. From there, it builds in small actions.

 

How to Respond to 11 Common Objections in Real Estate

Feel free to steal and use these scripts. Conversations can go a myriad ways, but these should give you a headstart at handling objections.

 

1“I don’t need your service. My friend (or relative) is an agent.”

A lot of people know someone in real estate, so here’s a quick to way to offer an alternative value.

“That is great to hear! Are you comfortable with sharing all of your personal information with your friend? As you know in the home buying/selling process, all of your financial data is front and center. I know I wouldn’t want my friend knowing that much about me. Are you sure you want your friend knowing your financial business?”

 

2“I’m okay right now. I’m renting a nice place that I like.”

This is a golden opportunity to show them a financial opportunity in owning.

“Why pay someone else’s mortgage when you can pay yours, build equity, and get more house for less monthly?”

 

3“I’m a couple of years out from buying.”

Everyone loves to window-shop, but it’s a good time to explore the right time to buy.

“Just out of curiosity what is the significance of that date? If we could get you approved for a loan, get you in a house today and show you how to save thousands, would that be of interest to you?”

 

4“This is my first time buying a home. I’m a little nervous.”

For anyone buying their first home, it can be nerve-wracking. Help put them at ease.

“Did you know that Real Estate has outperformed the stock market in the past 3 years. The wealthiest people in the world own real estate. In just the past year home prices have gone up over 3%. That means if you bought a house today for 300k in one year you would have over 9k in equity.”

 

5“My credit is bad, so I’m just day-dreaming right now.”

This is a great opportunity to offer financial advice that could re-shape their lives.

“Its great to day dream and I encourage you to continue looking on our site. Have you talked with a credit repair company? Many times they can make a couple of tweaks that can bump your score dramatically. Can I share your name with _______ at _________Credit Repair?”

 

6“I’m just looking on behalf of a friend (or family member).”

Let them know you can be an extension of help.

“That is great that you are looking out for your family, it shows you want the best for them. Fortunately for you, you came to our website. We are ranked in the top 1% of agents in the country. If you’d like, I can reach out to your friend/family and send them some helpful information that can save them thousands on purchasing a new home and why it’s so important to pick the right buyers agent.”

 

7“I have an agent already.”

Check to see if they already have a buyer’s agreement. If they haven’t committed to one yet, there’s an opportunity for you.

“That is great that you have an agent. Can you share their name so I can send them the properties you have been looking at?”

Nine out of ten times they really don’t have an agent. But based on their responses, you can address them like so …

  • If they give you a name: Fantastic, I will send this to _____ , but it concerns me that you don’t have a written agreement and the only way for me to work for you as your real estate coach is with a signed buyer agreement. Without it, I am working as a referee in your purchase.
  • If they don’t give you a name: You know they lied to you. Continue as though they don’t have an agent.

 

8“I’m just looking right now.”

Even though their timeline may be far out, they’ve still shown interest in real estate. See if you can gather their reasons for searching today.

“I love looking at homes too. It’s why I got into the business. What made you decide to look at homes today? I see… continue with LPMAMA.

 

9“I never registered on your website!”

Be understanding that there is some confusion. It’s always good to double-check and see if another family member registered with their contact info.

“I’m sorry. Perhaps your husband/wife registered with your information. Are you looking for a home in __________?”

 

10“You have been contacting me way too much!”

Giving a lead the 10-days of pain can be brutal and annoying. Again, acknowledge their issues and offer a reason + solution.

“First let me apologize. We are in a very fast paced market right now and I want to make sure that you don’t miss out on any deals. How often would you like to be updated?”

 

11“I’m busy right now. I’ll call you back.”

Try to get a small commitment here – ask if they can answer 4 quick questions in less than 2 minutes. This will set you up for further conversations later, where you can offer more detailed help.

“I understand, if I can just ask you 4 quick questions I can have you off the phone in less than 2 minutes. Would that work?”

 

Walking Away with a “No Thanks”

Hearing the word “no” is never easy, and getting rejected can easily put you in a dark mood. So, it’s worth saying, “don’t give up.” Perseverance requires maintenance in real estate. If you start to feel tilted, like you’re getting more frustrated, take a break. Do something non-work related.

Acknowledge the wins you have had this week, and the hot opportunities you have in the coming days. And if you need an extra boost, these Reddit sub-channels are great motivators: 1) /r/GetMotivated! 2) /r/aww.

The post How to Handle 11 Common Objections in Real Estate (Scripts Included) appeared first on BoomTown!.

Dec. 21: AE, LO jobs; LO tools, loan defect report out; shutdown’s possible impact on lenders; Verus non-QM deal

Welcome to the Winter Solstice with more daylight in the Northern Hemisphere every day for the next six months. Today is definitely greeted by residents of Fairbanks, Alaska where the sun sets at 2:40 in the afternoon (with a high temperature of -14). More sunlight isn’t all that’s going to be happening. According to Private Communities Registry (PCR), an online resource for real estate shoppers interested in “amenity-rich, master-planned lifestyle communities,” buyers do their most serious research for a second home in the winter, right after Christmas. What else? Oh yeah, another potential government shut down. We’ve been through this before, right? Caribou and hibernating animals will have to leave the national parks. Lots more below.

Jobs & new roles

Mountain West Financial continues to expand its footprint in Wholesale. “We are pleased to announce a rare opportunity, as we are currently looking for top sales professionals with 3-5 years’ experience that have established, quality broker relationships to join our Elite Wholesale Team. In addition to our large variety of lending options, we are industry leaders in the affordable housing arena. There is a reason we have been voted a Top Workplace 4 years running; we excel in creating relationships. If you are interested in being a part of the Mountain West family, send your resume to Laura Martell.”

Angel Oak Home Loans is proud of our phenomenal growth and success due to exceptional customer service, commitment to clients, and an innovative line of structured portfolio loans. Our products are ideal for buyer’s diverse loan needs such as an in-house Jumbo program, Asset Qualifier, and Bank Statement among others. We help self-employed, those with a past credit event, and investors to name a few. Success is the goal for all of our partners whether you are a client, buyer, or loan officer. Loan officers receive internal leads to help develop and grow their business. If you are interested in joining our team of experts at Angel Oak Home Loans, please contact Lee Williamson.

Congrats to Maria Vergara who has joined Fannie Mae and will be overseeing Fannie’s affinity and industry partner relationships. Maria has over twenty years of experience and in-depth knowledge of the financial, investment and housing industries while serving in senior management roles at organizations such as NAHREP, CitiMortgage Prudential/Wachovia, and Edward Jones. (Maria is taking the place of long-time vet Beth Millstein who is retiring at the end of March.)

Lender products and services

If this challenging market environment has you searching for answers on improving your profitability and competitive position, why not tap into insightful benchmarking that is trusted by the industry and is based on current transaction level data specific by channel? ICON’s LendersBenchmark™ analytics platform delivers the actionable insights you need while there is still time to impact your performance. Insights on your competitive position and relative results in the marketplace are easily gained across product, risk and geographic segments by benchmarking your production and pricing versus the market. Focus less on trying to access and process data for reporting and spend more time understanding the actions you can take to positively impact your performance with LendersBenchmark™. Contact our VP of Client Success, John Sayre, to learn more.

Don Calcaterra, Jr., VP of the Community Home Lenders Association (CHLA), is testifying at today’s House Financial Services Committee hearing on GSE reform. CHLA will present its views from the small IMB perspective: Maintaining cash window and small/mid-size lender securitization execution and prohibiting volume discounts by guarantors and securitizers. CHLA will also raise concerns about proposals to use GNMA as the vehicle for what is currently the entire GSE market. This comes in the wake of reports that GNMA is curtailing small IMB commitment authority requests, raising net worth requirements beyond posted requirements, and taking other actions that could curtail smaller issuer participation.

CHLA is warning of small issuer scrutiny that appears disproportionate to credit risk, at a time when GNMA is making $1.5 billion in annual net profits. CHLA expects to issue a report on GNMA in January, with recommendations to preserve full participation of smaller IMBs as GNMA issuers.

Looking for ways to grow your business? Freddie Mac is collaborating with clients to deliver automation and insights that provide a competitive edge. Cut back on documentation and reduce time to close with Loan Product Advisor® automated income and asset assessment capabilities. Save borrowers time and money with ACE appraisal waivers, now available for certain condo unit loans. Grow your condo business with Freddie Mac’s unit-level condo exception tool, Condo Project AdvisorSM. Get greater efficiency with simpler collateral QC and underwriting in Loan Collateral Advisor® Get The Freddie EdgeSM.

ARMCO Q2 2018 QC Trends Report: Defect Trends Indicate Continued Lender Downsizing – “In Q2 2018, we saw continued increases in defects typically resulting from downsizing and understaffing,” said Phil McCall, president and COO of ARMCO. “This seems to indicate that many lenders are still responding to the reduction in business and compressed margins with personnel changes, even in a purchase-dominated market.” The report’s

Noteworthy findings for Q2 2018 include: A significant quarter-over-quarter increase (23.8% over Q1 2018) in defects related to Loan Package Documentation, which are often associated with downsizing and understaffing; the majority of defects were attributed to the Income/Employment category; core underwriting and eligibility issues were the most frequent cause of critical defects; defects attributed to Borrower and Mortgage Eligibility increased by roughly 70%, from 6.57% in Q1 2018 to 11.36%. READ THE FULL REPORT

PerfectLO.com has solved your problems in your office by designing the only true interactive loan interview that asks every question systematically. A completed 1003 is useless and is painful if your LO fails to ask the 2nd and 3rd level questions that don’t exist on the 1003. PerfectLO creates an exact doc checklist based off the borrower’s answers. PerfectLO now offers a customizable questionnaire for your HELOC, reverse, commercial, auto and personal loans. Customize your solution today!  Sign up for a free trial and demo. How can you have a digital mortgage if you still have to think and ask dozens more questions and figure out what you need for documentation? Schedule a live webinar with their team and you will see why PerfectLO is the smartest and best POS for mortgage on the market.  They speak ‘mortgage’ not . Multi-language, upload, realtor interaction, SMS dashboard updates and more.”

Shut down

A shutdown would further reduce confidence in government? Guess what? It can’t go much lower. Once again, we can all follow the inability of our government to come to a decision, or an agreement, about its fiscal responsibility. What happens to the process of making a home loan if the government actually shuts down? Too bad the government doesn’t produce a single source, but here is a good start: A list of contingency plans from 2015.

Because Congress has already approved a portion of the various appropriations bills, only certain agencies would be impacted by a shutdown, such as HUD (including FHA and Ginnie Mae), USDA (including RHS), and Treasury (including the IRS). Authorization for the National Flood Insurance Program is also set to expire at this deadline.

If the government shuts down today, every non-essential government employee should wake up really late and smile. After all, they are lucky. When private companies have budget problems, the people on the non-essential worker list don’t get a three-day weekend. They get a six-month ‘vacation’ of sending out resumes, eating Ramen noodles, worrying about their mortgages, and filling out applications. In comparison, the furloughed government workers will have some time to enjoy the holidays in D.C.

The mainstream press won’t let this happen, but what if the U.S. government shut down and no one noticed? Even worse (or better, depending on one’s point of view), what if all federal workers went on furlough and the public realized there were benefits, not just costs, to smaller government? Essential services will be maintained, including the distribution of Social Security checks. Employees involved in the military, national security and law enforcement will stay on the job. Non-essential workers will be furloughed.

Since it doesn’t rely on Congressional funds, the Federal Reserve (central bank) would remain open for business as usual, with normal staffing levels. The Fed would therefore be able to continue with its day-to-day operations. The SEC is expected to continue operations as well. But lenders and vendors were out warning originators about possibilities. Not so with the IRS or SSA – open but good luck avoiding delays. NMLS offices will probably remain open during any government shutdown. The Federal Home Loan Banks? Open.

HUD has a plan. Reportedly the FHA will be able to endorse single family loans, with the exception of Home Equity Conversion Mortgages (HECMs) and Title I loans, during a shutdown. It is said that the VA will continue business as usual during a shutdown. But any pending Case Number, LDP, GSA, CAIVRS, 4506T, and SSI Validation be ordered as soon as possible. If a shutdown does occur, FHA Connection and VA Information Portal may or may not be available, 4506T, IRS Transcript processing and SSI Validation will not be available.

MBA has created a guide should a partial Federal government shutdown take place on December 22.

Capital markets

Some say non-QM lending is doing just fine. Critics say its volume is a tiny percentage of overall originations. This week correspondent investor Verus Mortgage Capital (VMC) completed its seventh rated RMBS transaction for $442 million, the second largest in VMC history, and its fourth securitization this year. Rated by S&P Global Ratings and Morningstar, the transaction included 809 owner occupied non-QM loans as well as non-owner occupied loans from 61 lenders. VMC is backed by Invictus Capital Partners. VMC purchases loans in all 50 states and the District of Columbia and focuses solely on the non-agency market. VMC has purchased in excess of $3 billion in expanded, non-agency loans since its inception. In addition, through its affiliates, VMC has completed seven rated securitizations.

The U.S. 10-year closed Thursday +1bp to 2.79%, as we saw further yield-curve flattening with markets digesting Wednesday’s FOMC statement and preparing for a potential U.S. government shutdown as President Trump indicated he would not sign the stop-gap bill that passed through the Senate, which would have pushed the shutdown date back to February 8. Media outlets had a field day with the resignation of Defense Secretary Jim Mattis as speculation abounded regarding the future of the Trump administration. Separately, House Speaker Paul Ryan said that President Trump indicated he will not sign a stopgap funding bill that does not include funding for the border wall.

Internationally, the Bank of Japan made no changes to its policy stance; the Hong Kong Monetary Authority raised its base rate by 25 basis points to 2.75%, as expected; Sweden’s Riksbank unexpectedly hiked its repurchase rate by 25 basis points to -0.25%, noting that economic activity is strong and inflation is expected to remain close to target in the near term; the Bank of England voted unanimously to keep its key rate and purchase program at their respective 0.75% and GBP435 billion; and Banxico raised its overnight rate by 25 basis points to 8.25%, as expected.

Today’s heavy economic calendar kicked off with updates on Durable Goods and the final look at 3rd quarter GDP. GDP clocked in at 3.4%, lower than expected, but it is old news. Durable Goods were +.8%, less than forecast with plenty of negative numbers “under the headline.” Coming up is Personal Consumption Expenditures (PCE). The core PCE deflator is forecast unchanged at 1.5%. November personal income expected increasing 0.2% MoM with consumption rising 0.3% and the Core PCE Price Index rising 0.2% MoM and 1.9% YoY (versus 1.8% previously). The University of Michigan Sentiment Index, also ahead, is seen declining at 10:00am, as is the KC Fed manufacturing print 30 minutes later. We begin today with the 10-year yielding 2.79% and Agency MBS prices better by .125 versus Thursday’s close.

Santa was very cross. It was Christmas Eve, and NOTHING was going right.

Mrs. Claus had burned all the cookies.

The elves were complaining about not getting paid for the overtime they had worked making toys and were threatening to go on strike.

The reindeer had been drinking eggnog all afternoon.

To make matters worse, a few of the other elves had taken the sleigh out for a spin earlier in the day and had crashed it into a tree.

Santa was furious. “I can’t believe it! I’ve got to deliver millions of presents all over the world in just a few hours, and all my reindeer are drunk, the elves are walking out, and I don’t even have a Christmas tree! I sent that stupid little angel out HOURS ago to find a tree and he isn’t even back yet! What am I going to do?”

Just then, the little angel opened the front door and stepped in from the snowy night, dragging a Christmas tree.

The angel said, “Yo, fat man! Where do you want me to stick the tree this year?”

And thus, the tradition of angels atop the Christmas trees came to pass…

Visit www.robchrisman.com for more information on our industry partners, access archived commentaries, or to subscribe to the Daily Mortgage News and Commentary. If you’re interested, visit my periodic blog at the STRATMOR Group web site. The current blog is, “Low Down Payments Can Help Borrowers AND Lenders.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are hundreds of mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2018 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

Here’s what title insurers need to know about the feds’ new rules for all-cash real estate deals

[Expert commentary] Last month, the Treasury Department’s Financial Crimes Enforcement Network announced that it was expanding on its rules that require title insurers to report buyers’ identities and the source of the funds for certain residential real estate deals. Here’s what title insurers need to know about the new rules and what they can do to comply with them.

The 7 Drawbacks of House Hacking (& How to Overcome Them!)

sell-or-rent-house

We frequently talk about the advantages of house hacking—living for free, building equity in a property, tax advantages, etc. What we rarely talk about are the drawbacks. As a house hacker, I feel obligated to share with you some of the drawbacks of house hacking that you need to be aware of and how to overcome them. 

View the full article: The 7 Drawbacks of House Hacking (& How to Overcome Them!) on The BiggerPockets Blog. This content is Copyright © 2017 BiggerPockets, Inc. All Rights Reserved.