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Breaking Down Home Purchase Closing Costs Step by Step

Introduction to Closing Costs

When purchasing a home, understanding closing costs is crucial. Kevin Retcher of First Meridian Mortgage recently addressed a common inquiry: the closing costs associated with a $750,000 purchase in Northern Virginia, with a 20% down payment. Let’s delve into the specifics.

Lender Fees:

Lenders may charge several fees:

  • Origination Fee: This is typically 1% of the loan amount. For a $600,000 loan, that equates to $6,000 if charged.
  • Processing and Admin Fees: While some lenders, like Kevin’s company, waive processing fees, an admin or underwriting fee can average between $750 and $1,200.
  • Loan Discount Fee: Optional fees that can lower your interest rate over time. Consider these if you plan to keep the loan long-term.

Other Relevant Fees:

  • Appraisal Fee: Often necessary, though some waivers might be available depending on the loan specifics.
  • Credit Report Fees: Recently increased to $74, with further hikes anticipated.
  • Tax and Flood Services: Ensure timely payment of property taxes and assess flood risk, respectively.

Title Company Costs:

Homebuyers often overlook costs related to title companies:

  • Settlement Fees and Lender’s Title Insurance: These can vary widely. Kevin advises vetting several providers to find the best rate, as these fees represent a significant portion of closing costs.

Prepaid Items:

While not technically closing costs, prepaid items affect overall cash flow. They include property taxes and homeowner’s insurance, which need to be covered in advance to establish escrow accounts.

Kevin’s Expert Tips:

  • Comparative Shopping: Always get multiple quotes from different title companies and lenders to ensure competitive pricing.
  • Use Available Tools: Many title companies have online calculators for estimating costs.

Final Considerations:

Kevin concludes by stressing the importance of approximating these costs based on location and specific home purchase terms. His insider tips offer a roadmap to potentially reducing closing costs by leveraging competitive quotes and selectively paying certain fees upfront.

In wrapping up, Kevin highlights his network of vetted brokers across various states, ensuring robust support for clients nationwide, whether in VA, D.C., Maryland, or beyond.

By understanding these essential components, homebuyers are better positioned to manage their finances effectively and secure their dream homes with confidence.

How to find a good Loan officer for a Purchase or Refinance

 

 

How to Vet a loan officer

 

In today’s digital age, finding and verifying credible recommendations can be a challenging task, especially when it comes to something as significant as choosing a loan officer. Here, we explore how to ensure that the recommendations you receive are trustworthy and reliable.

Seek Detailed Recommendations

When someone recommends a loan officer, delve deeper by asking specific questions: Why do they recommend this individual? When was the last time they worked with them? What type of loan was involved, and what was their personal experience? It’s important to assess how smoothly the process went, the communication effectiveness, and any unexpected issues faced. Most importantly, ask them if they’d truly use this loan officer again and if they’d recommend them to their family.

Consistent Feedback and Profile Verification

Look for consistent feedback across various sources. If multiple people recommend the same individual, it adds credibility. Utilize platforms like Nextdoor, Facebook, Instagram, and YouTube to verify user profiles and ensure recommendations come from real locals. Remember, a recommendation loses credibility if the source is from distant locations.

Cross-Reference and Conflict of Interest

Cross-reference recommended loan officers on platforms like Yelp, Google, the Better Business Bureau, or NMLS to ensure they have no violations. Be wary of recommendations that appear overly promotional or incentives tied, like getting a kickback.

Consider Recency and Conduct Follow-Ups

Consider the recency of a recommendation—older ones might not reflect a current scenario. For example, if someone vouches for “Joe” from 20 years ago, verify if Joe is still active in the business. Once you have a shortlist, ask these loan officers for loan estimates. Provide them with a standard scenario to compare their responses. If any are hesitant to provide detailed estimates upfront, they might not be the right choice for you.

Engage the Community

Leverage the collective knowledge of your community. Ask around if others have had experiences with specific loan officers. Multiple positive experiences from different people could indicate a good reputation.

Conclusion

Being thorough and diligent in your search and verification process will help ensure you find a reliable loan officer who matches your needs. For those needing assistance with mortgages or refinancing, feel free to reach out to Kevin Retcher at First Meridian Mortgage. Serving Virginia, Maryland, D.C., and 32 other states, Kevin is dedicated to providing excellent service. Semper Fi to fellow Marines.

 

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Happy Veterans Day

 

Dear Veterans,

On behalf of First Meridian Mortgage and myself, Kevin Retcher, I want to express our deepest gratitude for your service and sacrifice to our great nation. As a fellow veteran and former Marine, I understand firsthand the challenges and sacrifices that come with serving our country.

Your unwavering commitment to protecting our freedoms and way of life is truly commendable. The courage, honor, and integrity you’ve demonstrated throughout your service continue to inspire us all. Your dedication reminds us of the values that make our nation strong and resilient.

At First Meridian Mortgage, we are committed to supporting our veterans in their civilian lives, especially when it comes to achieving the dream of homeownership. We recognize that your service has given you unique skills and experiences that make you valuable members of our community.

To all veterans, whether you served in times of war or peace, your contributions have not gone unnoticed. Your sacrifices have paved the way for the freedoms we enjoy today. We owe you a debt of gratitude that can never be fully repaid.

Thank you for your service, your bravery, and your continued dedication to our country. We are honored to serve you in return.

With utmost respect and appreciation,Kevin Retcher
Owner, First Meridian Mortgage

How to Skip Two Payments on a Refinance

Here are the Pro’s and Con’s of skipping 2 Mortgage Payments on a Refinance

When considering refinancing your mortgage, you’ve probably come across advertisements or mailers boasting the ability to skip two payments. This offer can sound enticing, but understanding the details and implications is crucial. In this blog post, we’ll break down how skipping two mortgage payments works during a refinance, exploring the pros and cons of this approach.

The Reality of Skipping Payments

Firstly, it’s important to understand that you do not actually get to skip paying the interest on your mortgage. While it may feel like you’re skipping payments because you are not mailing out the payments for a couple of months, the interest still accrues and has to be paid.

 

  • How to Skip 2 Payments on a Mortgage Refinance

    Refinancing your mortgage can be a smart financial move, but the concept of skipping payments can be a bit misleading. Kevin Retscher, owner of First Meridian Mortgage, breaks down the process in a way that’s easy to understand. Here’s everything you need to know about skipping one or two mortgage payments when refinancing.

    The Reality Behind Skipping Payments

    When literature or promotions claim you can skip payments during a refinance, it sounds appealing, but the reality is more complex. Truth is your really bringing the payments to the closing table on the day of closing. Here’s a look at how you can manage this process and the financial implications: Pro’s and Con’s

    Understanding Interest Payments

    When you make your September mortgage payment, you’re actually paying for the interest accrued in August. Your principal balance might stand at $200,000, and let’s assume that closing costs of the refinance are $3,000, with an additional $2,500 for escrow startup.

    Scenario One: Skipping One Payment

    If you close on the 15th of a month and your last payment was on September 1st:

    • You owe 15 days of interest to the old lender amounting to $1,000.
    • This makes the total payoff to

    Your new loan also requires prepaid interest for 15 days, another $1,000.

  • Adding the closing costs and escrows, your total obligation comes to $207,500.

Now, you have two choices:

  1. Bring Money to the Table: Bring $7,500 to the closing and finance only $200,000. The first payment is due on November 1, and you’ll receive your escrow refund from the old lender within 30 days.
  2. No Out-of-Pocket: Finance the whole $207,500, which means you’re skipping a payment but rolling $7,500 into the new loan. This option involves essentially taking $4,500 out (the difference between the total amount rolled into the loan and the money you receive back from the old escrow).

Scenario Two: Skipping Two Payments

The process for skipping two payments starts by not making your regular payment and closing earlier in the month, say on the 10th:

  • You now owe 40 days of interest to the old lender ($2,700), making your total payoff $202,700.
  • You also need to prepay interest to the new lender, and with closing costs and escrows, your total spins up to $209,500.

Again, your options are:

  1. Finance Everything: By rolling everything into the new loan, you finance $209,500, effectively skipping two payments. Your first payment would be in December, and you would get back your escrow from the old lender, making it a no out-of-pocket deal but increasing your principal.
  2. Partial Out-of-Pocket: Bring $6,500 to the table, finance $203,000, skip two payments, and get your escrow back. This option is more cash flow neutral, limiting the increase in your principal balance.

Important Considerations

No matter which scenario you choose, remember:

  • Interest is Accrued: Whether you bring money to the table or roll it into the loan, you’re simply changing the timeline of your payments, not eliminating them.
  • Evaluate Closing Costs: Different lenders offer various credits or have different fees. Always ask for a detailed breakdown of costs.
  • Cash Flow vs. Principal: Your financial situation will dictate whether bringing money to the table or rolling it into your loan makes more sense. Balancing immediate cash flow needs with long-term financial health is critical.

Conclusion

In conclusion, while the idea of skipping mortgage payments during a refinance can be alluring, it’s essential to understand the details and implications fully. Make sure your loan officer explains all the factors involved so you can make an informed decision that’s best for your financial situation.

For more detailed information and personalized advice, contact Kevin Retcher at First Meridian Mortgage at 703-799-5626. Semper Fi to all the Marines out there!

Realtor commissions after the NAR Settlement the first 30 days!

The Impact of NAR Commission Rule Changes: An In-depth Analysis

Introduction Hi, my name is Kevin Retcher, owner of First Meridian Mortgage. Recently, the National Association of Realtors (NAR) introduced new commission rules, and I wanted to examine how these changes have affected the commission environment over the last 30 days. To provide a thorough analysis, I collaborated with a local title company to gather statistics on open contracts and utilized advanced tools for data analysis. Get the Report

Breaking Down the Data

To begin with, the transactions were divided into three categories based on their purchase price: – **$200,000 to $450,000:** This category saw 11 transactions. The average listing commission was 2.26%, and the selling side averaged 2.45%. The average purchase price in this range was around $340,000, which likely included many condos. – **$450,000 to $766,000:** In this mid-range category, there were 15 transactions. The average listing commission was slightly higher at 2.45%, while the selling side was comparable at 2.47%. The average purchase price here was approximately $627,000. – **$766,000

Higher Price Range Analysis –

**$766,000 and Above:** This highest category included 14 transactions. The average listing commission held steady at 2.45%, consistent with the mid-range category. Interestingly, the average selling commission decreased to 2.32%. Notable outliers in this category included one listing done for a flat $500 fee and a transaction where the selling agent left the commission off the contract due to the absence of a signed buyer agreement, performing the transaction for free. ### Observations and Additional Insights A few additional observations from the data: – Out of the 40 transactions sampled, only one client chose to go through the transaction without a buyer’s agent, which was lower than anticipated. This aligns with traditional patterns, but it will be interesting to monitor if this trend changes over the next 90 days. – On the listing side, there was a mix of commission rates: – One transaction at 1.75% – 17 transactions- 14 transactions at 2.5% – 8 transactions at 3% – On the selling side: – 9 transactions at 2% – 2 transactions at 2.25% – 25 transactions at 2.5% – 3 transactions at 3% Interestingly, higher-priced transactions (average purchase price around $950,000) saw lower commission percentages. This trend suggests that as the loan size increases, the commission rates as a percentage tend to decrease.

Future Implications Looking ahead, it’s crucial to continue monitoring these trends

While the last 30 days have provided essential insights, the real impact of the NAR commission rule changes might only become apparent over a more extended period. We will keep an eye on how these patterns evolve over the next 90 days.

Conclusion These early observations indicate that despite the new NAR commission rules, the overall landscape remains relatively stable.

The vast majority of transactions still involve both a listing agent and a buyer’s agent, and commission rates, for the most part, have held steady or slightly increased depending on the price category. If you need further insights or assistance, feel free to contact me. My name is Kevin Retcher, owner of First Meridian Mortgage. I’m dedicated to exceptional service, and I have never missed a closing date on a purchase. As a veteran-owned business, I extend my gratitude to all veterans and particularly to my fellow Marines—Semper Fi! If you’re in need of a reliable mortgage broker in Northern Virginia, don’t hesitate to reach out at 703-799-5626. I look forward to speaking with you soon.

 

You can find the report at https://firstmeridianmortgage.com/Housingreport.pdf

 

Why work with a Mortgage Broker

New Research Concludes Consumers Save $10,662 Working With a Mortgage Broker

Study also proves the crucial role brokers play in promoting homeownership to minorities and veterans

Pontiac, August 28, 2024 – A recent study conducted by Polygon Research, with support from Willow Canyon Advisors and United Wholesale Mortgage (UWM), has concluded that the wholesale channel provides substantial savings for consumers on average across various mortgage verticals and within a standard reference loan profile.

Most notably, the study, which examined the most recently available 2023 HMDA data, found that consumers save an average of $10,662 over the life of the loan when working with an independent mortgage broker as opposed to a nonbank retail lender.

“As we’ve been saying for over a decade, the wholesale channel continues to showcase time and time again that it is the best place for a consumer to get a loan,” said Mat Ishbia, president and CEO at UWM. “This data further proves that when consumers work with an independent mortgage broker, they typically save thousands of dollars, and almost always have a faster, more seamless and personalized experience. The broker channel has seen tremendous growth over the last few years because of these direct consumer benefits. We don’t believe it is unrealistic for the channel to reach 50% market share and will do all we can to support our partners and educate borrowers.”

Borrowers are also seeing significant savings on average in upfront costs. For example, in 2023, a year marked by generation-high interest rates, home purchase consumers in the wholesale channel paid an average of 115 basis points upfront to obtain a 6.58% average interest rate, compared to 148 basis points upfront and a 6.60% average interest rate in the nonbank retail channel.

“For years, our own analysis has shown that mortgage brokerages supported by wholesale lenders provide consistently better value to consumers,” said Willie Newman, principal of Willow Canyon Advisors. “It’s exciting and validating to see that this is supported by an expert third-party research company, and that the 2023 results continue supporting the mantra ’brokers are better.’” Beyond the savings over the life of the loan, the study also concluded that veterans and minorities benefit significantly by going through the wholesale channel.

VA Loan Savings

On VA loans from non-bank lenders specifically, borrowers save an average of $13,432 per loan when working with an independent mortgage broker as opposed to a retail lender.

In addition, VA borrowers who obtained their loans through the wholesale channel received a 6.26% rate on average compared to a 6.40% rate from retail lenders and had to pay less than a percentage point (87bps on the loan amount) compared to the retail channel (106bps).

Serving Minority Borrowers

The wholesale channel also saw a higher percentage of home purchase loans originated to minority borrowers compared to the retail channel. In 2023, over 1.4 million loans were originated in Minority Majority Census Tracts (MMCT). Among non-bank lenders, the wholesale channel showed higher approval rates for all loans in MMCT (70%) compared to retail (58%), as well as non-MMCT (75% vs. 64% for retail).

“The research shows brokers not only offer better deals on average, but also excel in reaching minority communities, especially in times when affordability is a key concern,” said Jonathon Haddad, CEO of the Association of Independent Mortgage Experts (AIME). “The numbers in this study speak for themselves, and further underscore the importance of educating consumers across the country on the benefits of getting a mortgage with an independent mortgage broker.”

The high percentage of home purchase loans originated to minority borrowers through the broker channel highlights its crucial role in promoting homeownership among underserved communities. The study demonstrates that independent mortgage brokers, with their local presence and access to a wide range of loan products, are often better equipped than retail loan officers to understand and address the unique financial needs of minority borrowers, providing personalized guidance and support throughout the homebuying process.

Consumers looking to work with an independent mortgage broker should visit MortgageMatchup.com. For more information on how to become an independent mortgage broker, visit BeAMortgageBroker.com.

Study Methodology

To analyze these findings, Polygon Research utilized the most comprehensive mortgage lending data sets from the Home Mortgage Disclosure Acts (HMDA) and monthly agency single-family performance and MBS data, totaling over 5 billion detailed loan records with the most current data available as of March/August 2024, depending on the data set. Polygon blended HMDA data with FFIEC Census data to provide population patterns in the context of mortgage finance activity. All analysis is based on loan-level data.

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My name is Kevin Retcher, owner of First Meridian Mortgage, is a recipient of the Top 200 Loan Officer in the nation multiple times by Scotsman Guide. We have one of the lowest margins in the wholesale channel and execute at the highest level. We never make more than 1% on a mortgage. I know that if the savings was compared to our loan level pricing it would be higher. The good news is that this study proves the Statement. That Mortgage Brokers are Better. Call First Meridian Mortgage for all your Mortgage Needs. A Veteran Owned Business.

Ultimate Guide to No Closing Cost Refinance

The Formula behind the NO Cost Refinance

 

No Closing Cost Refinance Explained

Refinancing a mortgage can be an excellent strategy for homeowners looking to save money, and in my 27 years of experience, I’ve found that a No Closing Cost Refinance is often the best approach. Since 1994, I’ve been helping clients refinance their homes without paying upfront closing costs, and I’ve seen firsthand how effective it can be, especially when loans are above  $200,000.

Why Refinance? Homeowners refinance for various reasons, with the most common being to save money by securing a lower interest rate. Others may pursue a cash-out refinance to access home equity for repairs or debt consolidation, or to switch from an adjustable-rate mortgage (ARM) to a more stable fixed-rate loan. Whatever the motivation, closing costs are a key consideration, and understanding the benefits of a No Closing Cost Refinance is crucial.

What is a No Closing Cost Refinance? Let’s clear up a common misconception: Yes, there are still closing costs with a No Closing Cost Refinance. However, instead of paying these costs out of pocket, you receive a credit from the lender based on the interest rate you select. This credit covers your closing costs, and any excess can go towards your escrow account.

In comparison, a regular refinance typically offers a slightly lower interest rate, but you pay the closing costs upfront. The difference between the two rates is usually about 0.25% to 0.375%. While paying the closing costs may seem appealing due to the lower rate, it can make you hesitant to refinance if you fear rates might drop further.

Why Choose a No Closing Cost Refinance? Opting for a rate that covers your closing costs allows you to refinance without the worry of upfront expenses. If rates decrease after 180 days, you can refinance again, continuously lowering your mortgage rate over time. This approach has helped my clients “chase the market down” for nearly three decades.

How Lender Credits Work Banks offer credits because they price mortgages based on the credit pools they might be sold into, such as those created by Fannie Mae or Freddie Mac. These pools include a range of rates—typically 0.25% lower and 0.25% higher than the average in the pool. The higher rates generate more value over time, leading to the credits that cover your closing costs. This allows you to secure a lower rate than you currently have, creating a No Closing Cost Refinance opportunity.

When to Consider Paying Some Costs There are instances where a hybrid approach—paying some costs while using lender credits for others—can be beneficial. However, it’s crucial to ensure that the recoup time is short, meaning you’ll save money quickly enough to justify the upfront expense.

The only time you should consider paying all the costs is if you believe rates are at their lowest or in a rising rate environment. Even then, it’s essential to calculate the recoup time carefully. Mortgage rates are cyclical, typically moving up and down over a two-year period, so running the numbers on each deal is vital.

Customer Insight A former Freddie Mac employee, who has refinanced 13 times with No Closing Cost Refinance, shared:

“I want to use the bank’s money to cover my closing costs. They think they’ll make more money over 30 years, but I’ll take the savings now, refinance again if rates drop, and use the savings to pay off my mortgage sooner.”

This strategy has empowered many homeowners to save money and pay off their mortgages faster by consistently leveraging No Closing Cost Refinancing.

 

No-Closing-Cost Refinance Options at First Meridian Mortgage

Refinancing your mortgage is a strategic way to lower your interest rate and monthly payments. At First Meridian Mortgage, we offer three distinctive no-closing-cost refinance options to suit different financial needs:

  1. No-Cost Refinance with Prepaids Brought to Closing

This option allows you to refinance without rolling any costs into your loan balance or increasing your interest rate. Instead, you pay the prepaid items—such as property taxes and insurance—upfront at closing.

  • Benefits: Keeps your loan balance and interest rate unchanged, potentially saving you money in the long term. Principal balance continues to go down.
  • Considerations: Requires having the cash on hand to cover prepaid expenses at the time of closing.
  1. No-Cost Refinance with Prepaids Rolled into the Loan

With this option, both the closing costs and the prepaid items are incorporated into the new loan amount. This increases your loan balance but avoids any upfront cash requirement.

  • Benefits: Eliminates the need for upfront cash payments, making refinancing accessible even if you don’t have immediate funds. You are borrowing from yourself, this is not a cost. You can make a principal payment when you get your escrow check back from your old lender.
  • Considerations: Increases the total loan amount, But you essential are borrowing from yourself if  the rate you are getting is lower? Then it still make financial sense to do. there is no recoup you are saving money.
  1. Hybrid – No-Cost Refinance and no out of pocket (All Costs Rolled In)

Sometimes in the market loan pricing could be better with a small contribution toward the closing cost. You have to do the math in these situations. This comprehensive option rolls all fees, including lender fees, title fees, appraisal fees, and prepaids, into your loan amount. It’s designed for maximum convenience.

  • Benefits: Completely eliminates any out-of-pocket expenses at closing, providing the most streamlined refinancing process.
  • Considerations: Results in the highest increase in your loan amount, which could lead to higher long-term financial costs due to increased interest payments.

How First Meridian Mortgage Supports Your Refinancing Needs

At First Meridian Mortgage, we understand the importance of a tailored refinancing strategy. We offer:

  • A variety of loan products that cater to different refinancing needs.
  • No Cost refinance VA Streamline IRRRL’s (Interest rate reduction refinance loan) FHA streamline, Jumbo No Closing Cost Refinances.
  • We Have a commitment to providing transparent and effective solutions to help you achieve your financial goals.

Whether you’re looking to adjust your loan term, decrease your interest rate, or consolidate debt without heavy upfront costs, First Meridian Mortgage is here to guide you through every step of the process. If you have any questions or need further information, our expert team is ready to assist you at our conveniently located offices in Virginia, Maryland, and Washington DC.

For personalized guidance on which no-closing-cost option is best suited to your situation, contact First Meridian Mortgage today.

Bottom Line A No Closing Cost Refinance is a smart choice for many homeowners, allowing you to refinance without the burden of upfront costs. By understanding how lender credits work and carefully considering your options, you can make informed decisions that save you money now and over the life of your loan.

 

 

 

New tool: Put your own loan into the free no closing cost refinance calculator and see the lower payment, the same payoff date, and the early payoff options compared side by side.

NAR Settlement: Key Changes for Buyers and Sellers

Navigating the New NAR Settlement: What Buyers and Sellers Need to Know

Navigating the New Real Estate Landscape: What the NAR Settlement Means for You

Hi, I’m Kevin Retcher, owner of First Meridian Mortgage and KSA Insurance Agency, and a licensed realtor with Jobin Realty in Springfield, Virginia. In today’s blog, I want to walk you through some significant changes in the real estate industry brought about by the recent NAR (National Association of Realtors) settlement, which took effect on August 17th. These changes could dramatically affect how listing and buying agents are compensated, potentially altering your approach whether you’re buying or selling a home.

Understanding the Previous System

Before diving into the new rules, it’s important to understand how things used to work. Traditionally, listing agents negotiated a sale price with sellers, which included a commission split with a buyer’s agent. This commission was then posted in the MLS (Multiple Listing Service). This setup, however, often led to situations where buyers might be shown homes that financially benefited their agents the most, rather than those best suited to their needs.

Buyer’s agents typically included their commission—often 2.5% or 3%—in agreements with buyers, implying that the seller covered it. However, this commission was actually built into the home’s price, meaning buyers often ended up financing this cost.

The Game-Changer: NAR Settlement

The new NAR settlement significantly changes how listing agents interact with sellers and how buyers work with their agents. The key focus now is transparency.

Key Changes for Sellers

  1. Compensation Clarity: Sellers now have several options to discuss with their listing agents, including:
    • Full listing services
    • Unrepresented buyer compensation
    • Buyer’s agent compensation
    • Limited services
    • Variable commission rates

    These choices offer more flexibility based on sellers’ preferences and budgets.

  2. Negotiation Flexibility: Agents must now clearly outline every detail regarding fees and services in their agreements. This eliminates ambiguity and ensures that both parties understand what’s expected, reducing the potential for misunderstandings.
  3. Transparency in MLS Listings: MLS listings must now accurately reflect the negotiated compensation terms. Sellers have a simple yes/no option regarding buyer’s agent compensation, moving away from the old percentage-based listings that could be misleading.

Considerations for Buyers

Buyers also need to navigate these new changes carefully:

  1. Negotiable Buyer’s Agent Compensation: Buyers can now explicitly negotiate their agent’s compensation upfront, defining precise terms, which can impact the overall cost of purchasing a home.
  2. Agency Agreements: It’s recommended that buyers interview multiple agents to find one whose services and fees align with their needs. Understanding the agreement’s term, which could range from a single day to several months, is crucial, especially regarding dual agency scenarios where the agent might represent both buyer and seller.
  3. Limited Services Option: Buyers who are comfortable handling parts of the home-buying process themselves can opt for a limited service agreement, where the agent assists only with specific tasks like writing contracts.

Pro Tips for Navigating the New Paradigm

For Sellers:

  • Scrutinize Listings: Ensure all compensation and service terms are clear before signing.
  • Evaluate Agent Proposals: Consider the value and services each agent offers, not just the commission rate.

For Buyers:

  • Understand the Costs: Know exactly what you’re paying your agent and confirm whether the seller covers these costs.
  • Negotiate Transparently: Have open discussions with your agent to avoid surprises later.

The Implications of the New Rules

These new rules are designed to create more structured and transparent transactions. While they aim to benefit both buyers and sellers, they also require everyone involved to be more proactive and informed.

For Sellers:

  • Have Detailed Discussions: Fully understand the new compensation structures and discuss all scenarios with your listing agent.
  • Review Contracts Thoroughly: Carefully review compensation clauses, termination dates, and potential fees before signing.
  • Leverage Open Houses: With new unrepresented buyer options, consider conducting more open houses but be prepared for additional negotiations.

For Buyers:

  • Interview and Negotiate: Interview several agents and negotiate their commission upfront.
  • Understand Financial Implications: Be clear on how agent fees will be covered, and how this impacts your budget and financing.
  • Keep the Timeframes in Mind: Ensure your agency agreement’s duration is suitable for your home search needs.

Conclusion

The NAR settlement introduces a new level of transparency and negotiability in the real estate market. By understanding these changes and engaging proactively with your agent, whether you’re buying or selling, you can navigate this new landscape effectively. Always take the time to read contracts thoroughly, communicate openly, and negotiate terms that meet your needs.

If you have any questions about the NAR settlement or need assistance with real estate or mortgage services in Northern Virginia, feel free to reach out to me, Kevin Retcher, at First Meridian Mortgage. With over 27 years of experience in the industry, I’m here to help you understand and maneuver through these changes. Contact me at 703-799-5626, and don’t forget to like, share, and subscribe for more updates and insights.

To all the Marines out there, Semper Fi!

Let’s make your real estate journey as smooth and successful as possible

Learn about the 4 C’s of Mortgage Lending with Kevin Retcher

 

Understanding the 4 C’s of Mortgage Lending with Kevin Retcher

Introduction

Navigating the complex world of mortgage lending involves understanding some key principles, chief among them the four C’s – Capacity, Credit, Capital, and Collateral. In a detailed seminar hosted by Kevin Retcher, President of First Meridian Mortgage, these foundational elements are thoroughly examined. Here’s a deeper look at the insights shared by Kevin on the four C’s of mortgage lending.

Capacity – Your Ability to Repay

The first “C,” Capacity, pertains to your ability to repay the loan. This factor evaluates your job stability, type of income, and debt-to-income ratio. Lenders examine your capacity to ensure that you can comfortably meet your mortgage obligations.

Credit – The Foundation of Trust

Credit is the second “C” and it focuses on your credit history and current credit score. During the seminar, Kevin highlights the importance of sound credit practices, including making payments on time and maintaining a varied credit portfolio. Understanding what affects your credit score is vital for successful mortgage applications.

Capital – Demonstrating Financial Strength

Capital, the third “C,” is about the financial assets you possess, which might include your down payment and any additional reserves or equity. Kevin discusses how these assets affect your loan-to-value ratio and the total amount you are eligible to borrow.

Collateral – The Security of Your Loan

Collateral, the fourth and final “C,” relates to the actual property you wish to purchase. This is what secures the loan. Kevin explains how the lender evaluates the property’s type, location, and condition as part of the lending decision process.

Interplay of the 4 C’s

Kevin Retcher emphasizes the synergy between the four C’s in mortgage lending. Each component—Capacity, Credit, Capital, and Collateral—is crucial in determining your eligibility and the terms of your loan. Understanding how these elements interconnect helps you make better-informed financial choices.

Personalized Insights and Tips

Throughout his seminar, Kevin offers tailored advice and tips to help attendees understand and manage the complexities of mortgage lending. His guidance covers everything from managing gift funds to assessing potential risks associated with collateral.

Closing Thoughts

As the seminar concludes, Kevin reiterates the significance of mastering the four C’s—Capacity, Credit, Capital, and Collateral—when pursuing a mortgage. Being well-versed in these areas helps prospective borrowers present themselves favorably to lenders and increase their chances of loan approval.

Conclusion

Kevin Retcher’s detailed explanation of the four C’s provides invaluable knowledge for anyone looking to buy a home or better understand mortgage lending. Armed with insights on Capacity, Credit, Capital, and Collateral, borrowers can strategically approach the loan application process and optimize their financial standing for future lending opportunities.

How to shop a VA loan in 10 Min, and determine who not to use!

How to shop for a VA loan while Buying a Home or PCSING!

In the below video I will show you how to Shop for a VA Loan with , Navy Federal, Pentagon Federal, USAA, Veterans United and First Meridian Mortgage.

In this video, Kevin Retcher, the owner of First Meridian Mortgage and a former Marine, provides an insightful guide for military families looking to use their VA loan in the Northern Virginia, Maryland, and DC areas. Kevin compares the VA loan rates and costs of the ‘big four’ military banks – Navy Federal, PenFed, USAA, and Veterans United – criticizing their hidden fees and lack of transparency. He then showcases how his company, by offering wholesale rates and a more transparent cost structure, typically offers better deals. Kevin emphasizes the importance of researching and getting pre-approved before PCSing and highlights the added value he brings with his extensive experience, military background, and wide network of agents familiar with the needs of military families. The video is aimed at educating military personnel on making informed decisions when purchasing a home using VA loans.

If you are Pcsing Feel free to reach out to me I have 32 States covered by other broker Owners like me. I would be happy to refer you to someone. If you are Pcsing to any of these bases,

#The Pentagon,# Fort McNair, #War College, #Fort Belvoir, #Fort Meade, #Fort Detrick, #Quantico, #HeadQuaters Marine Corps, #Fort Meyer, #Langley – Eustis, #Joint Base Anacostia Bolling, #Joint Base Andrews, #AP Hill Aberdeen Proving Ground, #Norfolk, #8th and I Marine Barracks, #White House, #Naval Academy, #Coast Guard Yard, #Washington Naval Yard, I have you covered.

 

I can also recommend a good Real Estate Agent to be the boots on the ground for you.

Kevin Retcher, Broker Owner

Loan Officer, Insurance Agent, Realtor

(o)703-799-5626

(C) 703-201-6138

Email Kevin@firstmeridianmortgage.com

Website: https://firstmeridianmortgage.com/

Loan Application: https://www.blink.mortgage/app/signup/p/firstmeridianmortgagecorporationx?campaign=loanapplication/

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Live Mortgage rates

https://firstmeridianmortgage.com/get-live-rate/#null/

First Meridian Mortgage, 8305 Richmond Hwy 12A, Alexandria VA 22309

KSA Insurance Agency, 8305 Richmond Hwy 12A, Alexandria VA 22309

Jobin Realty, 5592 Backlick Road. Springfield Virginia, 22151 703-642-8500

 

https://www.scotsmanguide.com/news/millennials-reclaim-largest-homebuying-share-from-baby-boomers/