Join 10x Real Estate Marketing, Coach Sean Shallis and Mortgage Expert Robert Bianchi, of Finance of America ..."Learn the Right Questions to ask Potential Buyers, Before Inviting them in your home!!!"
We weren't scheduled until two o'clock you're alive. I know we're alive. Everybody's Sean House, 10 X real estate market and coaching. I'm actually here with Robert Bianchi over a financial advisor and a mortgage lender over at finance of America mortgage. We're really excited to see it, but first of all, just let me clarify. Today's one of those funky days, you know I thought it was a two o'clock there's something else out there it's two 30. So we just decided to go live and give you as much value as possible. And, you know, I kinda tell you I'm really excited to have this conversation because Robert, how long ago did we, how long ago would we meet? It's been about maybe three, four weeks now, three, four weeks. And how did that conversation start? Just so everybody knows, like the, you know I want to prove a point that some people out there that are in our industry, especially because I don't know if you even know this 4% of our industry or any sales industry for that matter are willing to pick up a phone and talk to somebody they're not, they're afraid of confrontation.
How did our conversations
I started with a cold call, which I'm very hesitant to pick up and even answer you left me a great voicemail. And for some reason I decided to save that voicemail. I was about maybe two or three weeks before, after he reached back out to you. And I said, I dunno, you know what it is, you, you gives us a perfect voicemail. This is a recording. Is this guy a robot? I gotta talk to this guy, is he for real? And you know, we got on the phone and, and sure enough, everything that's was portrayed in the the voicemail was true to be. And when we spoke on the phone,
So it's funny you say portrayed you know, I just wanna, I just want to throw this out. There is, you know, Nope, no false pretenses here. I called Robert because I had sold another house around the corner and I said, Hey, we sold this house. We sold it in a week. And multiple offers. We have a tremendous amount of activity. And we're just wondering if you want to sell your house. And Robert said, yeah, as a matter of fact, I do. And then we got to talk in. And when I went out to see him, he said, you know, I'm in business, I'm a mortgage guy. And I said, great. I said, you know, tell me more about that. So give us a little background on your, your background in the business and then you know, and how you got started and why you do it.
Yeah, absolutely. So I got into the industry about, oh, it's not about 15 years ago, no, 16 years, 2005. When I first got in green wet behind the years, someone told me I can talk to people about numbers. I was a math guy and they like to make money doing it. They're okay. Numbers talking to people, I waited tables. I was a math major. It seemed like the two things lined up together perfectly. So I dove in and you know, I had a lot of great mentors in the beginning. Guys that really showed me the ropes taught me the industry. And like anything the overtime, the more I've been in the industry, the more I've learned and evolved. So I started off in like a broker space very independent you know, shopping things around to all different lenders. Cause that's all I knew at the time.
Then eventually got into retail. I worked for a PNC bank chase bank for a number of years. And only more recently just got over to finance of America you know, a little more independent, but we are a direct lender. So you know, the things I like about what I do is that I'm able to help people and educate people on the home buying process. The mortgage process itself, a mortgage in general seems to be pretty scary to a lot of big numbers biggest financial decision you're making. So I like to think I could write the book mortgage for dummies cause I made it really simple for me to learn it. So I like to try and make it really simple for my clients to understand what they're doing. You know, that's probably the biggest joy of what I do and you know, I've been in for a while now and it's, it's, it's gotten to a point where honestly, I could say that every day I'm still learning something new, but I'm better at transferring that information now and making it valuable to my clients, you know?
And I really enjoy man.
So interestingly enough, when we met you know, we, we met under the, under the context of, Hey, you know, I met a nice girl. I asked her to marry me. I told you what a mistake that was. And then I said, okay, I'm smarter than I ever met in my life. And I do wish you the best of luck, but I also, you know, we also talked about moving on with your life to the next, next jump. And you said, Hey, you know, I want to sell my place. And I said, you know, and, and I'll be truthful. Here is just as I was with you, is you, you know me well enough at this point, there's no, there's no filter. I'm a Jersey kid through and through you know and I sent the, I go selling a house for me is just another it's, it's kind of boring after a while because I've done it like 2000 times, but, you know, taking, taking, selling your house because you're in the industry and taking that and then showing people how the process works and using you as kind of like the Guinea pig, because you know, it benefits you to show people, Hey, here's what the process looks like.
And when you say to somebody, Hey, I know what you're going through. You can actually look back at this and they can say, well, what about what I'm trying to show my place? And I'm going to let people in or show them the house. I mean, you know, today's thing is, are they really buyers? Are they tire kickers? And you know, the deal joke is, you know, buyers are liars, you know for the most part. And that was, you know, when I was coming through the ranks and I was just, I was telling CRO my associate. I said, you know, when we used to get rentals, I would do, I would do three or $400 a weekend because I would do a rental. And I would put people in, not my cell phone, not my Palm pilot, not even my iPad thing. It was basically a calculator that had like a phone book in it that you could type in letters in, you know?
And it was like an eight, it looked like an HP CA calculator, you know, and it, it was one of the only ones that went sideways. So you could, you could type with big fingers. And, and I said to him, I go, I could tell you how long ago that was, because we didn't have fax machines. We had fax machines and the listing came in on a fax machine and you were like, oh. You know? So so let me ask you this. We sold you a bill of goods when I came out to see you. And I said, Hey, you know what, our real passion and what we believe in is everybody needs a real estate coach. We also believe that, you know, we can, we have a duplicatable repeatable process that generates results in marketing and the selling of homes, and we try to make it.
So it's Stressless, it's fun. And it's kind of, you know, we kind of, we kind of walk you through the process and like, like you came, you were on vacation. You said, oh, Sean, what about this? Or what about that? And I, you know, just trust the process. Let's just see what let's, we're putting a bunch of fishing hooks in the water. We don't know what's going to work yet, but we're going to see which one does work. And one of the things that, you know, I always get the question is how do you know that person is qualified? Or how do you know when they're not qualified? And you know, I'm going to give you my piece because what most people don't understand is, and the way our it's just our process works a lot of times is the personal call, the homeowner, or call an agent and they'll say, Hey, I want to go look at this house. And the homeowner you, the homeowner said to me, Hey, Sean, just make sure they're qualified before they come in. And I don't want the tire kickers coming into my house. Right. So how do we know? And we're listening to certain things and, you know, God bless us. Can we release that? We had a pretty good, pretty good day today.
We actually got, we actually got a contract today on, on Robert's place. And, and I said to him, I go, you know, and he knew right away, cause he's in the industry. I said, here is the set of, here's a set of things that are going on with that particular buyer. Even though they have a low down payment, they have all these other things that are emotionally attaching them to this transaction and Robinson, I get it. I'd rather them be emotionally attached. So what made you as the seller? Not as the mortgage guy say, Hey, listen, I get it. I understand the money and further equity that they're going to put in my house is in their house. And I have to sell that one in order to bring it over here. But what gave you a level of comfort that you kind of knew that that would happen? Well, I
Mean, it, it definitely drawing on the experience I have just from, in my job and right in my career where I'm, I see transactions all the time. I've done numerous where it's, you know, we closed on the sale of one house at 11:00 AM and we purchased the new house at 2:00 PM. Right. You know, and it's, it's having been in a situation where I'm kind of monitoring both sides. We don't want, you know, for my client, I will talking to their person who is buying their house. They were trying to make sure all those ducks in a row and talking to my client to make sure his ducks were over his purchase. So I guess my level of comfort with those types of transaction was probably the first thing that disarmed the, you know, the, the sale contingency that came along with it. And then also to, you know, to, to keep the shares, I guess, private as possible, the, the, the goal behind them or the reasons why the buyers were looking to purchase the home, you know, for a family, you know, wanting to get into school district you know, things like that, you know, just show it for me that they're buying it for the right reason.
You know, it's not like you're talking about a fly by night. It's like, you know, we've talked about trauma where, you know, who's moving out of mom's basement and then maybe I might buy, I don't know, but I've been living in mom's basement for 20 years. It might be better to stay here. And three weeks later they say, you know what? I changed my mind. No, these folks have a motive behind what they're doing. And that definitely helps ease the concerns for me. Right.
There's nothing worse than the deal where the agent tells me they're living at home. They got all the money in the bank. Their mom, you know, they, they don't have anything to sell. They just had a baby and I'm thinking, and their mom's doing their laundry, did that to spend every nickel they have, and they don't have any expenses and they're living at their mom's and they just had a baby who and their mom, they need the help of their mom. I wouldn't move out of the house if I had a choice.
No, it was my neighbor. Maybe that'd be the only exception, but yeah. Right.
I might want to go hide you. Haven't got there yet. And congratulations on the Robert. I'm getting engaged by the way, but he hasn't figured it out yet. He's going to be looking to hide in my shed when he has his first kid. But you know, at the end of the day what are some of the things that you'll hear a customer say that sets off your, like your alarm system when they're, when you're talking to them, like if I send you a buyer and the guy says I'm doing blah, blah, blah, or I have this going on, what are the, what are the things that you, you go you know what I think we're going to have to check your credit first before I can really sign up.
No, for sure. The things that, you know, the, the big triggers right now, I'd say more recently is, is, is really around income, right? And stability of income. Not necessarily a dollar amount. Not that I want to jump off the first question, how much do you make per year? And that's a very forward question right off the gum, but like when you have someone who's talking about, you know, I'm just changing jobs or, you know, I just got, I just got my new job. I just got my new things like that. At first, we're going to, we have to dive a little deeper. That doesn't mean it's a dead deal, but it's something that's going to make me think. You know, the other thing I would say too, is, is, you know, when they start asking about in terms of assistance for down payment, right? Hey, listen, we have those options. They're there for a reason, want to definitely explore them. But if you're coming to me about purchasing a home and you're talking about how you're going to rub two nickels together to make it happen, well, we're gonna have to do a deeper dive. It doesn't, again, it doesn't mean that the deal is dead, but these are the things that when they come up, concerns about income variation and income concerns about down payment money. You know, those are the main things
I asked you a question what if I get a gift from somebody? Can you explain that process to people? I mean, I don't know how it works, but explain to, you know, I don't think people, I recently did a transaction where, you know, grandma's stuck $50,000 in the account and then they wrote the check and they were like, well, where'd this come from?
I agree. That's a great question. So like, that's definitely something when I have that, that alarm go off. As far as when someone says, Hey, down payment might be an issue. I do bring it up, say, no, we are, you are able to get, you know, like gifted funds for your down payment and your closing costs simply put, I mean, what it is is that you have a family member, immediate family member, who's giving the funds to the person who's gonna be buying. And what we do is compose it what's called a gift letter. So that gift letter basically spells out and say, Hey, this is not a loan. This is not a debt liability. This is me gifting, grandma, two grants on mom to solve whatever it may be funds to help them purchase their home. As long as we have a, a, what would say, like I say, a clean money trail, right? We don't have money coming in from all different places at once. We have a check from grandmas into, you know, grandsons or grants, a checking account. At that point, we have a gift letter sign and we have a clear idea of where the money is coming from at the end of the day, you know, any lenders, just making sure that, that they can document clearly and cleanly where those funds for down payment closing costs or whatever that may be is coming from.
So here's a, here's a tricky thing for you. And I've seen this, you know, I haven't seen this in a while, but what is, you know, back in the day I could've got, I could've gotten my daughter a loan for a million dollars.
You didn't check your pulse. Okay. Here's why
We call them. We called them ninja loans. I don't know if you have no, no income, no assets, no job, no problem. No problem. Right. And so, but at the same time, we also had people that were ex pats or people that were coming into the United States to work here for three to five years on work visas. They were, you know, they're not, they're not voting, they're not able to vote, but they are considered to be a naturalized citizen. So how does, you know, what is the you know, what happens with those people?
Yeah. So there's definitely, it's going to be very by very what type of visa they have. If it is on a work visa, there are things that are permissible. Now, the one thing I've seen in terms of just coming into, with, running into folks who are new to the country is established credit. You know, that's going to be a piece of it as well. So they have, they're literally first day walking into the country, no established credit, even if they had the work visa and a great income, no credit score, no ultimate sources of credit. Right. That'd be a tough situation for them. But it doesn't mean, again, nothing's not doesn't mean it's not doable. We just have to look into it. It's just another way. It just has to be done a different way. Exactly. And I don't want to, I want to touch on really quick, Sean, cause you mentioned it you know, the, the, the, the no income, no assets, no job loans. That's, what's kind of propelled us into this ability to repay law. That's a rule. That's one of the biggest things right now that I tell folks,
No, it's the, the ability to repay rule is fairly new. Yup.
So like, what that really is about is that we want to make sure that when we're lending out money, bottom line, number one thing, this is one of those end all be all can be a deal killer is that you have the ability to repay meaning your documented income shows a high strong enough ratio compared to what your mortgage payment's going to be. That on paper, it shows clearly that you have the ability to repay this mortgage. You're taken out, I've run into folks with giant down payments, perfect credit scores, no income on the books, unfortunately with the ability to pay repay rule Sol. So let's
Give the, let's give the ability to repay rule the AKA of that. Right. Which was, you know and I'm just going
To put it here and no doc, no doc loan, you know, is
Really what it was. And just for those people out there. And, and, you know, and I I'll say this, and I know, I know, you know, Robert knows this over the years have done a lot of mortgage training and I probably know more about mores than most mortgage people in the end that I know of. And it's frightening because I really don't want to know that much about more, but in order to get some sometimes in order to get a deal worked out or fill a hole or get a whole filled you need to understand the language and, you know, so our companies doing no doc loans anymore. And if they are, what kind of, what kind of rates are we like? Not, not rate, but more like a down payment programs, or are they looking after that? Yeah.
So now there are, to my knowledge, there are still some broker shops, more shops that are out there that are still doing these types of loans. Very limited basis. I know we don't offer anything. The only thing that we have, we have some bank statement loans for self-employed folks. We have some alternate sources of income, but it still has to meet the ability to repay rule. So what you would call what you would call it, portfolio loan, correct? Correct. Correct. So like, but the true, like the no doc, no income verifications. From what I know you're talking about rates typically one and a half to two times what the going market
Rate is. Let's see, let's just touch on that for a second. Just so that I tried to explain Israel recently to somebody and the guy looked at me like I had four heads and I said, you know, when they go to the Jimmy Stewart bank and they get the money, when you watch it's a wonderful life and they're down to their last dollar, you know, the bank doesn't just run out lane on that money. And then, and then after they lend out the last dollar, they closed the doors for 30 years and wait to get their money back. Right. So they package up the loans. They, they say to, you know you know, Robert's company says to me, Hey, we're going to give you the loan and we're going to put it together. And we may borrow the money from the government, or we may do some other way of doing...
