Your search results

Did COVID-19 infect Home Mortgages?

Posted by Johnine Larsen on April 2, 2020
| 0

We talked with mortgage lender Kate Beck about the impacts COVID-19 will have on home mortgages. We discussed:

  • Reprice options
  • How much interest rates matter
  • What she can do for homebuyers
  • How to plan your personal finances during this time

In our 25+ years of working with lenders, we’ve found several who consistently go above and beyond for their clients. Kate is one of our favorites. 


The Skinny

Kate thinks rates will fluctuate wildly over the next several months—sometimes changing several times during one day. Some lenders will not weather this time and will go out of business, so make sure you work with a reputable bank and a real mortgage person.


Reprice Option: Take it!

During this turbulent market, make sure your lender offers a reprice option and find out how much that reprice option costs. For example, Wells Fargo charges 0.125% to reprice after a lock (on a $700k loan, the reprice option requires a $875 one-time fee)

Having a reprice option means that you can lock as soon as you get into contract, but if rates drop before closing, you can take advantage of the lower rate while also being assured that your rates won’t go up. You can’t get a worse deal with a reprice option, but you can get a better one.


Price v. Interest: How much does it really cost?

The rule of thumb is that if purchase prices drop by 10% but rates increase by 1%, you will keep the same monthly house payment—so waiting around for prices to fall might be negated by higher interest rates. You have to balance price and interest to find the true long-term cost of a home, and right now, interest rates are low.

No matter the interest rate, this still hold true: it’s always important to find a home you like, with a payment you can afford, and a plan to stay there for at least 3–5 years.

The Seattle real estate market year-over-year is WAY less volatile than the current stock market. So if you lock in your rate during an uptick in rates, remember that you can always refinance when they drop—be cautious about paying points if you think you might refinance anytime soon.


Wells Fargo: What Kate can do

Wells Fargo is the very best for Jumbo loans (any loan over $511,000), including a 10% down jumbo loan. Wells Fargo offers a permanent rate discount of 0.125% for every $250,000 on deposit with them:

  • $250,000 = 0.125%
  • $500,000 = 0.25%
  • $750,000 = 0.375%
  • 1 million + = 0.5%

Wells Fargo also offers unlimited re-amortizations anytime you put $20,000 or more down (this is great if you plan to sell after buying, or if you get large bonuses and want to lower your monthly housing payment). Wells Fargo is making a point to focus and use their resources for purchase business. They can still close loans within thirty days and are not overwhelmed with refinance business.

We recommend talking with Kate. If she doesn’t have the best loan option for you, she will happily help you find a good fit.


Personal Financial Planning

Priority #1: Live within your means. Keep a family budget and pay attention to where your money goes. It’s not so much the income that matters, but the OUT-GO that really counts.

Priority #2: Have at least six months of living expenses in savings available. Home Equity Lines of Credit make fabulous emergency funds.

Priority #3: Protect your credit score as much as possible. Check in with Kate before missing a mortgage or credit card payment to find out your options if money gets tight.

Priority #4: Purchase term life insurance outside your employer-supplied policy. The minute you get a terminal illness, you lose your job and your company-sponsored policy. Ten-, fifteen- or twenty-year term policies are very affordable when you are fifty years old or younger

Leave a Reply

Your email address will not be published.

  • Real Estate Gals
    Based on 51 reviews
    powered by Google
    Virginia Bunker
    Virginia Bunker
    14:08 14 Feb 20
    Johnine Larsen and her team are absolutely fabulous. I've bought and sold many properties over the years, and Real Estate Gals surpassed all of my previous experiences with agents. Johnine designed the perfect selling strategy. She then handled every detail leading up to the day we listed,... including cleaning, yard work, repairs, staging and more! Johnine has a heart of gold, and I can't say enough great things about my experience. Thank you!read more
    linda wright
    linda wright
    00:45 04 Dec 19
    I have bought and sold many homes in my forty plus years of being a Seattleite and I couldn't be more pleased with the way Johnine Larsen and her team handled the sale of my previous home. I moved into my new place and they took it from there. Contacted the right people to do the minor repairs at... a reasonable cost, staged the home, and had professional photos done within a few weeks. The sale went smoothly as well. I am so thankful that I found her.read more
    Paddy Lazar
    Paddy Lazar
    23:42 03 Dec 19
    I was lucky enough to work with Johnine and her very competent team to sell my home. I have to tell you how easy the entire process was. On her wise suggestion I had my home inspected, as there actually were a number of maintenance items that came up in that inspection and she even arranged to have... all of the repairs completed in a very short time. The only thing I had to do was to let the repair folks in. Then, to my surprise, Johnine , had all the windows and the whole house cleaned before listing it. She then had the house beautifully staged and had the yard cleaned up with even a little landscaping thrown in. The house sold within the week for OVER full price! Everyone I dealt with was always kind, helpful and professional, their communication was exemplary all through the process. I’ve decided to rent for a while but you can be assured that it will be Johnine and her team that I will go back to when ready to purchase a new house. I have sung her praises to all that I know.read more
    soumak ghosh
    soumak ghosh
    00:00 14 Nov 19
    They were representing the seller and I was the buyer. Very limited communication from the agents. Waited days for a response for any email/text. Would eventually get a response after multiple follow ups. Almost cost us the deal. [Update] I have seen all the text/conversations of my agent with... your agency. Regarding the oil tank decommissioning, according to the contract, the tank was to be decommissioned 5 days before closing. When asked about so 5 days before closing ( which I have seen the text/email conversations of), you gave my agent very little to no information about it and even said it was on schedule. It was only after my agent called the oil decommissioning company that we got know that it was not even scheduled to decommission it 2 day before closing. Any buyer who was not as intent on buying the property could have walked away due to breach of contract. We got the final documentation 2 hours before the end of closing. It was only after I wrote the review that your agents became responsive. P.S. If you find my review unjust I’m sure it would be overshadowed by stellar reviews from future customers.read more
    Sarah Donaldson
    Sarah Donaldson
    18:44 18 Jul 19
    Darcie was such a joy to work with. She felt like family during the sale of our house and the search for our new home. We may have found our forever home, but if we ever need a Realtor in future, Darcie from Real Estate Gals will be our first call.
    Brian Heagler
    Brian Heagler
    16:55 02 Jun 19
    I have worked with Johnine and her team for 19 years and have always received personal, knowledgeable and professional service and attention! There is never and pressure and they will guide you away from a property when appropriate, which is always appreciated when a market is hot and the tendency... is to move quickly. I trust them and have never been let down!read more
    Anne Slater
    Anne Slater
    18:03 25 May 19
    Johnine Larsen is fabulous! She listened and came up with ways we could get what we wanted in a house and stay within our limited budget. When we found the house we wanted, she moved super fast to get the house inspected and implemented creative ideas to make our offer appealing. And out of 13... offers, we were selected and got our house. I recommend her to anyone buying a home.read more
    Amy Burdick
    Amy Burdick
    19:13 24 May 19
    Real Estate Gals made sure we found our perfect house! Then, when we were up against other bidders, Johnine worked tirelessly to ensure we were tops! Her extensive real estate experience combined with exceptional character and integrity provided peace of mind throughout the process. She also made... sure we received the right value as a seller and got the transaction done quickly and efficiently. Simply stated: there is nobody better to help you find your dream home.read more
    Bill Hollman
    Bill Hollman
    22:21 19 May 19
    I'd give Real Estate Gals 6 stars if I could. We have used them multiple times, both in selling and buying homes in Seattle and the surrounding area. I can't say enough about the professionalism, knowledge, and patience they bring to the task of buying a new home, or selling your current... residence. And they know the Seattle area so well, they'll offer valuable insights into the pros and cons of any location you may be to considering. Look no further, call Johnine at Real Estate Gals. You will be glad you did!read more
    Beth Guerra
    Beth Guerra
    01:14 18 May 19
    Johnine was a breath of fresh air in the real estate market. She listened intently to our wishes and goals, and was tireless in her search for our perfect house. She is well versed in both Seattle and the surrounding areas. She made sure all the details were taken care of after the inspection, and... made the closing process seamless. She even gifted us with a housewarming present. Nearly 7 years later, we still receive holiday cards and well wishes. I highly recommend Real Estate Gals and will look no further in the future.read more
    Aidan Key
    Aidan Key
    15:44 17 May 19
    Johnine and the Real Estate Gals brilliantly took us through the home buying process two different times. Their willingness to educate (I was new), hear our home hopes, and support us through the process are a few of the reasons that I highly recommend this team. Speaking of a team, I love their... collaborative business model - it meant that we--the home buyers--always had a returned phone call and an ability to look at a house on OUR schedule. Truly felt like they place the customer first!read more
    Next Reviews