The Lending Coach

Coaching and teaching - many through the mortgage process and others on the field

Second Homes and Investment Properties – New Regulations and Rates

Fannie Mae and Freddie Mac are tightening the underwriting criteria for second homes and investment properties. They will also begin to limit the number of these mortgages that they will acquire.

“Recent amendments to our senior preferred stock purchase agreement with Treasury impose additional risk criteria on the loans we acquire,” the Government Sponsored Enterprise said in a letter. “One of those restrictions is a 7% limit on our acquisition of single-family mortgage loans secured by second home and investment properties.”

This means that non-owner occupied transactions (2nd homes and investment properties) will become a bit more difficult in terms of qualification and slightly more expensive, in terms of interest rates.

Lenders are now being forced to add to the cost of the loan and raise interest rates – anywhere from 50 basis points to as high as 250 bps.  That can mean an increase in rate of 1/8% to 1.25%, depending on the investor.

Finance of America, my employer, has added 50 basis points for all 2nd home and investment property purchases and refinances. This is on the low side, relative to many in the industry, as others that I’ve spoken to have added as much as 250 bps.

From Investopedia: “Basis points, otherwise known as bps, are a unit of measure used in finance to describe the percentage change in the value of financial instruments or the rate change in an index or other benchmark. One basis point is equivalent to 0.01% (1/100th of a percent) or 0.0001 in decimal form.”

Don’t hesitate to contact me for more information to see how this might impact your upcoming purchase.

9 Mental Keys for Young Pitchers

A big part of playing consistently and confidently is training not only the body, but also the mind. This is especially true for young pitchers.

Staying calm, breathing, forgetting what just happened and only focusing on what’s in front of you at that second—this is all much easier said than done.

Trust, clarity, detachment, simultaneously being calm while channeling peak intensity—these are all qualities confident, mentally tough pitchers have perfected.

I’d like to reference an article from Steven Ellis at YouthPitching.com where he elaborates on 9 key mental training “secrets” for young players.  It’s a great read and you can find it here…

Some key highlights from Ellis’ article:

Visualize Success

One coach postulates that the pitchers who simply visualized their mechanics to the plate and visualized themselves hitting the spot they’re throwing to, had an increase of 25% accuracy versus pitchers who just get their spot and throw.

Eliminate Fear

Once a pitcher accepts that fact that risk is present, he might as well start focusing on the reward and opportunities that exist:

  • The opportunity to be the hero
  • The opportunity to get the big W
  • The opportunity to take over and control a game
  • The opportunity to help the team win 

Only once a pitcher realizes this, can he throw with 100% authority……and without reservation.

Maintain a positive attitude

There will be times in your pitching career where you will have ups and downs. 

Your success over the long haul, however, will come down to attitude.

Taking at least one deep breath when nervous or in trouble helps to calm the mind and body. The extra oxygen into the bloodstream chemically relaxes or slows down the built up tension.

There’s much more in Ellis’ article, so please do visit his site and read the entire piece!

March 2021 Mortgage Rate and Market Update

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Photo by Markus Winkler on Pexels.com

As inflation rises, it typically causes mortgage rates to move higher as well.  That’s because inflation is the arch enemy of interest rates, since it erodes the buying power of the fixed return that a mortgage holder receives.

While inflation may look tame to everyone at this time, that looks like it will change when you dig a little deeper. 

Inflation Fears

But in the coming months, the inflation levels are expected to rise significantly, as the readings for the more current months replace the extremely low numbers from 2020. 

A look at the closely watched “Consumer Price Index Core Rate” of inflation, which strips out the volatile food and energy sectors, shows a current reading of just 1.3% inflation for the past 12 months.  This has helped interest rates remain low.

It’s quite possible to see the rate of inflation rise towards 2.5%.  It’s likely that this will influence interest rates to higher levels.

For borrowers, the good news is that inflation is likely to become more tame later this year.  So now may be a great time for you to take advantage of the low-rate environment before these inflation readings start to move higher.

Secondly, our central banks have artificially depressed sovereign bond yields for years. Now, a small rise in yields can cause a move higher in interest rates, as well.

2nd Home and Investment Properties

Finally, Fannie Mae is tightening the underwriting criteria for second homes and investment properties, the government sponsored entity said Wednesday. 

“Recent amendments to our senior preferred stock purchase agreement with Treasury impose additional risk criteria on the loans we acquire,” the GSE said in a letter. “One of those restrictions is a 7% limit on our acquisition of single-family mortgage loans secured by second home and investment properties.”

This means that non-owner occupied transactions (2nd homes and investment properties) will become a bit more difficult in terms of qualification and slightly more expensive, in terms of interest rates.

Use That Equity

One other thing to consider for current homeowners – a cash-out refinance to utilize the equity in your home to eliminate all other consumer debt.  Many of my clients have saved anywhere from $500 to $1,750 per month in their overall payments.  Find out more on that here…and do reach out to me for more on this subject!

Barry Habib – MBS Highway 2021 Webinar On Demand

On February 4th of this year, industry expert Barry Habib joined Finance of America Mortgage for a presentation on the current real estate marketplace and his opinions on interest rates moving forward into this year and beyond.

It was a fantastic event and if you weren’t able to join us or would like to review it again, I have a link to the recorded version below.

By way of introduction, Barry Habib is a real estate and mortgage industry executive, bestselling author, and founder and CEO of MBS Highway. Barry is also a well known media resource and TV commentator on the mortgage and real estate markets.

Here’s the link:

Barry discussed his predictions for the housing market going forward in 2021 and the benefits of utilizing some key tools to show clients and referral partners the power of home ownership.

Also, regarding the AVM reports and “Bid Over Ask” tools that were talked about during the program – I can easily do them for any property or client you have.

Finally, here are a few links that might help, too:

The Lending Coach 2021 Forecast: https://lendingcoach.net/forecast-2021-real-estate-mortgage-rates/

Bid Over Ask Tool: https://lendingcoach.net/offering-over-asking-price/

I highly recommend that you take a look, as Barry has some fantastic insights into our market!

Mental Toughness Wins Ballgames

It’s true – mental toughness really does win baseball games. As you probably know, one of the baseball related subjects that’s continually in focus here at The Lending Coach is that of the mental side of baseball. 

Without a strong mental game, a player’s physical performance will always be limited.

Sports Psychologist Bill Cole

Today I’m linking to Bill Cole’s article “Mental Toughness Wins Ballgames” and I invite you to click on the link and read the entire piece.

Bill Cole is one of the most successful performance psychology consultants working today. He truly is a pioneer in the field of sports psychology, as he was the first person in the world to be awarded a Bachelor of Science (with honors) in Sport Psychology. 

He has been mental game coach or consultant to thousands of high school, college, professional, world champion and world record-holding athletes. 

His website can be found here – and he offers a valuable 65-question assessment tool at no charge to assist you in determining what is getting in the way of your performing to your full potential.

The Article

In his article, he writes about the 5 key things he focused on with the Stanford baseball team during their heyday:

1. Learn To Control Your Focus: The most important part of the mental game is “attentional control”. Where you place your focus, in what way, and for how long is key.


2. Keep Your Mind In The Here And Now: Good baseball is played one pitch at a time. Do that and your mind stays in the moment, the now.

3. Stay Poised And Patient: You want to play aggressive baseball, but you also need to remain self-aware, and tuned in to what is happening around you. This is vital to being a plugged in player who makes things happen


4. Develop Confidence And Self-Belief: If you don’t believe in yourself, who will? Everyone around you can tell you how good you are, but if you discount this encouragement, it will never enter your head and heart.


5. Use Mental Rehearsal: Get a competitive advantage with your mind by playing the game in advance, using visualization. Go to the movies in your mind and mentally rehearse what you will be doing in competition.

Again, here’s the link to the entire article…and I’d invite you to check it out!

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