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Mortgage Matters is your go-to show for all things home financing. Join Roland and Heidi as they break down the ins and outs of the mortgage world. From first-time homebuyers to seasoned investors, we’re here to guide you with expert insights, real talk, and the latest market trends. Whether you're looking to buy smart or refinance right, Mortgage Matters is your trusted source for smarter decisions and financial freedom. Tune in and take control of your home financing journey.
Wesley Knight 0:00
This is a Kun V studios original program. The content of this program does not reflect the views or opinions of 91.5 jazz and more the University of Nevada, Las Vegas, or the Board of Regents of the Nevada System of Higher Education.
Roland Daniels 0:43
Good morning Las Vegas. Welcome to mortgage matters. I'm your host. Roland Daniels, a certified mortgage advisor with Geneva financial. My NMLS number is 355859, company. NMLS number is 42056, and of course, I'm here this morning with my awesome co host, Heidi Griffith, good morning. Heidi, well, good morning. How are you? I am doing fantastic. I'm
Heidi Griffith 1:10
glad to hear that I'm Heidi Griffith. I'm also a mortgage advisor and your Director of Client Services. My NMLS number is 2247754, thanks for joining us this morning. So we're actually going to continue the conversation that we had last week, right with our CEO of Geneva financial, Erin van Trojan, Hey, Aaron. Hello. Good to be back. Thank you so much. I think that we should spend some time talking about Fannie Mae and Freddie Mac are you down? I'm down. Let's do it.
Roland Daniels 1:43
So the Trump administration is considering privatizing Fannie Mae and Freddie Mac potentially transitioning them from a government conservatorship to private sector. Can you give our audience a little bit more color when it comes to government conservatorship and then moving them to where they are going to the private sector as a possibility.
Heidi Griffith 2:06
Yeah, this one's interesting. Fannie and Freddie are an interesting topic. What's your take? Aaron, well,
Aaron Antrojen 2:11
they're not going, I mean, they're not going to try. They're going to assuming that they they can get their they can get enough time to do it. It was the number one pressing topic for them at the first administration. And then, of course, COVID, the pandemic, blindsided him, and they just ran out of ran out of time. This is a monster, monster event to be able to do this, and I'm a little bit on the fence on whether or not this good or bad thing. And just to give the the listeners a brief history, hopefully I won't put them to sleep, but Fannie Mae was created by the New Deal in 1938 and it was basically to provide inexpensive mortgages for for houses. And it's a government it's called a government sponsored enterprises, GST, and it basically is a assumed guarantee by the US government, if the mortgages go bad, the US government is going to come in. And it's just, it's just assumed, 25% right? It's not a guarantee. It's implied, right, okay, but again, this is, this was the creation, this was, was the creation of a 30 year mortgage at a lower interest rate. And most of the world 30 year mortgages don't exist. They're all just low rate mortgages, and they certainly wouldn't exist at a low interest rate. And the reason why they do is they're, they're traded like a US bond, like a US debt. That's why they trade very, very closely to the 10 year T bill, the treasury bill, because they're assumed, implied, backed by the US government. In 1970 they traded Freddie back to do the same thing and compete against Fannie Mae. And these entities worked very, very, very well, and basically ran the US housing or mortgage markets since 38 and they worked very, very well, very, very efficiently until they did it, which was about 2007 2008 and now they get blamed a lot for the housing collapse. They weren't. They were definitely a part of it, but probably very small pieces of pie. But at the end of the day, they failed. And when they failed, the US government did exactly what everybody thought they would do, and they came in and put them under conservatorship. So now you don't have an implied guarantee. You have a guarantee. It is the US government, right? They own, they control. They're housed under the US government, so they're no longer quasi government agencies as the government. And which very interesting and kind of a inherent conflict of interest always with these GSEs, is that you get a publicly traded these. These companies are publicly traded. You can buy stock in them. They're publicly traded when any publicly traded company, again. And its sole purpose is to take care of the shareholder. Well, Fannie and Freddie, sole purpose should be to take care of the homeowner or the US housing market. So there's always been this inherent conflict of interest, because if you're just taking care of capitalists, maybe you're not taking care of the homeowner, right? Absolutely, kind of a side argument again, these companies worked very, very well until they did it. The US taxpayer came in, had to bail them out, essentially put them under a conservatorship, where, now that they've righted themselves, those two entities have been printing money for years and years and years and years, even the last three years, where the mortgage industry has been pretty much running in the negative, Fannie and Freddie are still printing money for the US government, right? Probably the only entities in the US government that actually make tons of money, and they do so it's it's a little bit confusing. Why now, of all times that you'd want to take them out of conservatorship, and we turn them back to either be totally publicly traded companies or again, these quasi GSEs, is how they originally got established. Right now, a lot of people on the right, Republicans, I've always argued that we needed to get them we got to privatize them again. We got to get them out from under the government, because the US taxpayer cannot be on the hook for people's mortgages. They can't be. We can't put the put them at risk like we did already in 2008 the argument is that even if you completely privatized them with no in no implied guarantee by the US government. One interest rates would go up substantially because they're no longer backed by the US government. And
Heidi Griffith 6:49
that's, that's a pretty much a done deal, right? That we would forecast that we're going to see rates go up if this happens. And
Roland Daniels 6:56
what does that look like? Is there a percentage or a number. I
Aaron Antrojen 7:01
don't know. I mean, I I've heard anywhere between one 2% and again, not the end of the world, when interest rates are hovering as high as they are. Right now, that's that's a home. Affordability is bad as it is. Right now that one to 2% would be have a monumental impact on on housing, but I and again, nobody wants to hear that. But at the end of the day, I'm not, I'm not even overly concerned about that. If you totally remove the implied guarantee, the 30 year fix would go away. We'd be back late. We'd be back to the world's mortgage industry, which is, you know, our mortgage industry has been socialized since 1938 right? It's socialized. Nowhere in the world is it socialized that I'm aware of.
Roland Daniels 7:48
So are we looking at so are we looking at arms, then adjustable rate mortgages? Yes, yes.
Aaron Antrojen 7:56
Canada, or, you know, our northern friends, is that they typically have 30 year mortgages that are fixed for like, five, right? And then they adjust. That's not a bad thing. A lot of people are like, Oh, that's scary, because my arms, your arm, just rate mortgages, but it's not scary, or just more rate mortgages historically will actually outperform a 30 year fixed but that's a whole nother conversation, and
Heidi Griffith 8:18
they can be great loans. No, yeah, yeah. It's just
Aaron Antrojen 8:21
not what we know and not what people are comfortable with. But that's on a side note. But the what's absurd about the right argument about removing the liability from the US taxpayer is the government's always going to bail them out every time implied guarantee or not, right? They're always going to bail them out. Well, it's about money, right? Well, they can't. I mean, if Sandy and Freddie were completely privatized right now and they imploded again, which is more likely, with no CFPB, they would take down the world's economy again, unless the US government bailed them out. It's just like Chase Bank is never going to fail.
Heidi Griffith 9:00
No, they'll keep bailing them out, won't they? Right?
Aaron Antrojen 9:03
We thought, No way. You know, the biggest of the biggest mortgage companies or mortgage banks and banks and financial institutions didn't fail. A few big ones like Bear Stearns and Lehman Brothers did fail, but the vast majority of them didn't. They got bailed out US taxpayer, which is what we would always do to prevent another national or global financial disaster, right? So they're always going to have some kind of an assumed or implied or guarantee from the US government, ie taxpayer,
Roland Daniels 9:39
and what percentage? Sorry, go ahead, finish right.
Aaron Antrojen 9:44
I mean, is it a bad thing? Like you said, I'm on fence. I mean, there's the potential that more people would come in and compete. That's one of the arguments that the interest rates won't go up, is because more Wall Street firms would come in and compete with Sandy and Freddie, which the competition would drive interest rates down. And my argument is not that there's a 30 year fixed mortgage, because who wants to lend money for 30 years at a low interest rates? Nobody wants to do that. That's that's an absurd the only reason why we do it now, again, is backed by the US government, right?
Roland Daniels 10:16
Fair point. So in your opinion, what do you think that's going to happen, and what percentage does Fannie and Freddie make up in the housing market when it comes to home loans?
Aaron Antrojen 10:29
I don't know what it is right now. Ebbs and flows based on what's going on in the market. I know, you know, put that in proper perspective, you understand what I'm talking about. You know, three years ago, Fannie and Freddie probably did 85 to 90% of all the loans that Gu financial did.
Heidi Griffith 10:49
Okay? So the now they're probably
Aaron Antrojen 10:52
Yeah, but now they're probably in the 60s, because government loans. It's the other thing is the right now, the, essentially, the entire mortgage market is socialized. You have Fannie and Freddie controlled by the US government. You have FHA government, VA government, USDA,
Heidi Griffith 11:10
so when you're talking about government, just so that the listeners know we're talking about FHA, we're talking about VA, we're talking about USDA, yeah,
Aaron Antrojen 11:19
all, mortgages, right? I know sometimes USDA trips you like, wait and talk about beef, but USDA actually has a mortgage product, yes. So it's all government right now, with the exception of Fannie and Freddie, if they take them out of conservatorship. And my argument is, again, that it's worked so well for so long, why not one federal agency that does all the mortgages
Heidi Griffith 11:45
just like a housing mortgage? Yeah, that makes sense.
Aaron Antrojen 11:49
Yeah. I mean, it's largely doing that now and again. It's done that for in this crazy right? And again, for most of those years, it's done it very, very well. Or, you just let Wall Street take over and see how well they do, yeah, and we see how well Wall Street was just
Heidi Griffith 12:07
going to say that, that's going to be a really interesting look.
Roland Daniels 12:10
That could be scary.
Aaron Antrojen 12:13
It could be scary. You know, Wall Street's very, very functional, and we're very, very, very efficient. Most people, including myself, put money into stocks and what have you, but it goes off rails, right? And it will again. I don't know why or when, but it will go off rails again. This is cyclical saying, and you want Wall Street to go off rails with the mortgage industry your housing what essentially happens to lead to the class in 2008
Roland Daniels 12:38
and we don't want that again. No, we don't want that again. So
Aaron Antrojen 12:43
this is a big ticket item. It's a massive, monumental tax to take, amount of conservatorship, and I absolutely do think it's on the radar of the Trump administration. I think it can be done and reverted back to how it was, which again operated for decades and decades and decades, is very, very well. And
Roland Daniels 13:06
how long ago was What's that? How long ago was this? That it operated very well.
Aaron Antrojen 13:12
Well. It was created in 1938 okay, it blew up in 2008
Heidi Griffith 13:16
Yep, yeah. And banks, and banks and investors are probably pushing for this, right? I
Aaron Antrojen 13:22
mean, there's a lot of money to be made, especially if they completely privatize this, take it out of government all the altogether. I mean, there's a tremendous amount of money in mortgages, especially if we go to Adjustable Rate Mortgage Markets, because there's a lot more mortgage activity, because there's typically more refinance activity with adjustable rate mortgages, but the interest rates would absolutely go up if you get rid of the guarantee. They would have to, because no investor is going to backstop a US mortgage if they know that the government's not going to bail it out. Yeah, it would be the it would be the third gesture. I mean, just think about in 2020 when interest rates on a 30 year fixed mortgage went to 3%
Heidi Griffith 14:02
Well, it's free money at that one
Aaron Antrojen 14:06
you want to as an investor, would you invest your money at 3% no or No, 30 years, not
Roland Daniels 14:11
for that risk? Nope. Money was on sale, then
Aaron Antrojen 14:15
it would never happen. Which is why, if you get rid of the implied guarantee, that would never exist. That product wouldn't exist. So what would it take for an investor to invest in a mortgage that's not back stopped by the US government, especially on a 30 year term, a lot it would take up that interest rates to get that return. Now, if you put it on a five year term, adjustable rate mortgage or a three year term, you're going to likely get a lot of investors, not as big of a
Heidi Griffith 14:43
risk. Yeah, it won't be as so. So here's a question. I know that your our crystal ball broke long time ago. I'm sure yours did too, but I know you got your finger on the pulse. So I mean, what do you think? I mean, how, how do you think this is going to affect the housing market,
Roland Daniels 14:58
everything else? Go up, or prices go down, or we still have that big unknown. Well,
Aaron Antrojen 15:05
again, most, again, most, this is not going to be a popular thing, but most of the policies that Trump ran on and got elected on are inflationary. They just are tariffs are inflationary. So housing big picture. If he happens to hit Canada with a 25% tariff, that's that we get most of our lumber for Canada, it's going to skyrocket the cost of concern, right? And if you have massive deportation, I'm saying this is not I'm not arguing good or bad. I'm just telling you what will happen. I'm not saying that they shouldn't be deported or should be deported. That's not my argument. I'm just saying, if you do this, this is the outcome in what did they say? 40% of all the home builders are undocumented. Wow,
Roland Daniels 15:56
didn't know that. So, yeah, that's those are.
Aaron Antrojen 16:01
There's other people who jump in and build houses. That's probably true, but they're not going to do it at the same cost. That's right, drives up home prices. And again, not arguing good or bad, I'm just arguing the realities of these types of situation. Take Fannie and Freddie out of conservatorship, interest rates go up, changes affordability. So all of these things have a negative impact if debt, US debt rises, that increases interest rates, which is almost inevitably going to do because again, all the all the savings that we're supposedly getting from the government waste that they're cutting doesn't move the needle on US debt, not even remotely, doesn't no flicker. Wow. So not all good things. Doesn't sound warm and fuzzy and all those things, but you know, it's going to take, it's going to take a down economy to lower interest rates, which will lower values, making homes more affordable for a home buyer. That's great news
Heidi Griffith 17:00
for a guy who owns the house,
Aaron Antrojen 17:04
for a homeowner, you know, it's the funny thing that I let you know, I kind of poke fun at people all the time when they're when they complained about inflation. I'm like, Well, how's the equity in your
Heidi Griffith 17:12
house? That's it
Aaron Antrojen 17:14
all time highs. It's the same thing, just a different commodity. So if you want your groceries and your eggs and your clothes and your gas and all that stuff to come down, the value, your house will also
Heidi Griffith 17:25
come down right along with it. Yeah, it's gonna look interesting. Yeah, it's gonna be interesting to see this all play out. To say that, and
Aaron Antrojen 17:33
again, for the first time in my career, I have a hard time speculating what tomorrow's gonna look like it's going to be this is too many unknowns. Some of the good things this, this, this administration is doing things rapidly. I like when people get things done, but it might be coming with recourse, right? We don't know what the outcomes of some of these drastic changes are going to be, and they might prove to be for the good. I'm a little skeptical and hesitant, but it's going to take a little bit of time to play out.
Roland Daniels 18:12
So we're probably looking at a few years. No, no. I
Aaron Antrojen 18:16
mean, we could be, but again, my opinion is, you'll, you'll start to see when you look at the Dow has been getting killed for the last three days again. Three days does not make the trends, but interest rates, long term, interest rates have substantially dropped in the last three days. But that
Heidi Griffith 18:35
doesn't mean tomorrow looks the same for the next three days exactly, exactly right, it'll be. I do know that
Aaron Antrojen 18:43
they've talked a lot. They talked a lot about recession in the last three days. I haven't heard that word for two months in that scare people mild recession is actually a healthy cycle of the economy, because we are overdue things we're overdue, and as long as it's mild and not too deep. It's just a reset of the economy, and it's actually healthy,
Heidi Griffith 19:05
and it helps mortgage rates in most instances, and it absolutely helps our industry, absolutely, absolutely. So it'll be, I mean, it really is going to be interesting to see what tomorrow brings. And I say that very loosely with tomorrow, but we're going to keep our finger on the pulse. We We love talking to you about this, and I know that you always make sure that we're all at Geneva, updated on anything that's, you know, new and current. So we'd love to have you back on whenever you're available.
Aaron Antrojen 19:35
I'd love to be back on because there's, without question, without a doubt, this is what I can tell you tomorrow morning off something else to talk about. I know I don't even know about today. That's right, sounds awesome.
Heidi Griffith 19:46
Well, we appreciate you.
Roland Daniels 19:47
We really do appreciate your time. Aaron, did you know we've been with Geneva for two years now? Um, as of next month, next month, yeah, next month.
Aaron Antrojen 19:58
We love it. How fast time? Same
Heidi Griffith 20:00
slide. Yeah. We appreciate having this space. We appreciate you. Thank you again, Aaron, yes, thank you. Thank you. So it's always good to have Aaron in the studio. We really do thank him for his knowledge. We invite him back anytime he'd like to be here. Yep, yeah. So we've got some upcoming education, right? We do. We just finished our first of the month down payment assistance path to home ownership workshop we did PLC, that was with the HUD certified counseling agency, and it was a full house. Man, I think it was probably the biggest workshop, or
Roland Daniels 20:34
at least one of the biggest, the biggest in the last year and a half or so. It
Heidi Griffith 20:37
was amazing. It was so if you attended that workshop. Thank you so much. We had a great time. We laughed. We learned a ton. I learned a ton during that class. Yes, we appreciate it absolutely, absolutely. So that class is held the first Saturday of every month. It is that's an all day class. That class is from 830 in the morning till three in the afternoon. They usually try and get you out a little bit early. Just depends on breaks and the number of questions we get. But don't not ask questions, because it really is that good. It is we cover everything from budgeting to homeowners insurance. What to Expect When You're applying for a mortgage. We talk about credit, we talk about the real estate process. It's just, it's a really good overall class. We actually have had people come in multiple times for refreshers, haven't we? We do. Some people have attended three or four times. Yeah, yeah. And then we've got a class coming up tomorrow. We do it is with the Nevada housing division. That class is actually online. We try and do a class with Nevada housing about once a month, and we'll usually skip back from in person and online, because so many people like to learn different ways, right? They do, and this makes it super convenient, because you can pop on your phone, you can pop on your PC or laptop, you can, you know, do it on your bike, not driving. That is correct driving. If you're in the passenger seat or your stop, that would be a great thing. Please don't drive in. Zoom, we have enough problems on the roads, don't we? We do. But that class actually covers all of the down payment programs that the Nevada housing division offers, and they've got some programs. So they've got a first time home prior program, right they do. They've got a program that will actually allow you to have a home in another state and buy here in Nevada. You can own a home in another state, buy here in Nevada, and their income limits go up to 165,000 165,000
Roland Daniels 22:27
that was one of the questions we have in the class. So
Heidi Griffith 22:29
that class has those things that we can offer. They have a Teachers program, and that program was designed to actually bring teachers right here in the state of Nevada, into Nevada. So that's going to be available for Clark County School teachers. Yep. And through 12 all public school teachers throughout the entire state, yes. And that program will give you $7,500 that's forgiven after
Roland Daniels 22:52
just five years, five years, and it's prorated, by the way. And
Heidi Griffith 22:56
and we can't forget to mention that they actually do also have a program for veterans, because a lot of veterans will reach out to us and say, Hey, are there any down payment assistance programs available? Here's the interesting thing, of course, you don't need a down payment when you're utilizing your VA loan. That
Roland Daniels 23:13
is, correct? It's the best loan, right? Really, it is. I mean, the best loan out there. It's
Heidi Griffith 23:17
the it's one of the best things that we provide our veterans. Thank you for your service if you're tuning in today. But it's important to know that there are there are things available for vets as well. So they actually have a a program that offers a reduced interest rate they do. So since you're already getting your down payment covered by the
Roland Daniels 23:38
VA, right, there is no monthly mortgage insurance either. Yeah,
Heidi Griffith 23:42
we welcome you to give us call or text us if you'd like to register. Our telephone number is 702-210-2057
Roland Daniels 23:52
that's 702-210-2057
Heidi Griffith 23:57
Absolutely. And if you want to hop over to our Facebook page, mortgage matters radio, there's actually a link where you can register directly from that as well. Look forward to seeing you tomorrow. I think it'll be fantastic. So I know that we've got another veteran event coming up, don't we? Roland, we do. And
Roland Daniels 24:13
that will take place on Wednesday, March the 12th, and it'll be from 8am to 4pm at the World Market Center. Who's this through? This is through us vets of Las Vegas. The address is 435, South Grand Central Parkway. And for the zip code, just in case you want to punch it in, 89106,
Heidi Griffith 24:37
and what? What is this event about? I know us vets, does a lot of great stuff in the community for veterans. They really
Roland Daniels 24:43
do so in this particular workshop or this event, they cover everything from housing assistance, employment assistance, how to get your VA benefits, VA employment, they're going to be. Talking about medical care, getting your military records from A to Z, they're going to be covering everything.
Heidi Griffith 25:07
This is huge right now, because of so many cuts happening right and resources being harder and harder to come by, this is just one of those kind of events that does make a difference. It does, really does, if you are a veteran, or, you know, a veteran that might need some assistance, you know, some guidance, that kind of stuff. This is a great time to meet with the folks that have their finger on the pulse. I know we've been doing a lot of soul searching lately. There's a lot going on. It's not a political conversation, but it's a conversation about what we do moving forward. You know, we've talked over the past several weeks about the dismantling of the Consumer Financial Protection Bureau, the CFPB. We've talked about the big cuts that are coming to HUD and how we as consumers, because this really does affect every one of us, because every one of us is a consumer in some way, shape or form. This just isn't about buying a house. This is about if you own a house and you have issues, or you, you know, you you bank, or you have a credit card, or all of the things most of us do on, you know, a daily basis. Some of this is going on. So we have a a kind of a brainstorm initiative that's coming out. It's going to be called, help us help and we're just really looking for and asking folks for resources for all different kinds of things. We'll talk about it more next week, because I know we don't have much time today, right? But if you do have any questions or maybe you'd like to contribute to that, we also welcome you to reach out to us for that. It really will be something that I think that can kind of get everybody involved, right? Because
Roland Daniels 26:54
we're more than mortgage advisors. We are actually community advocates as well.
Heidi Griffith 26:59
100% 100% I know that we spend quite a bit of time looking for resources for people, reaching out for people. I mean, I just, I know last week, you actually had a gentleman who called in after the show and was having a concern with his service or whether he
Roland Daniels 27:18
was having issues with his servicer regarding the amount of his payments,
Heidi Griffith 27:24
it was his impound account. Was an impound account. It was his impound account. And so, you know, sometimes it takes just a little bit of digging. It takes, you know, kind of the telephone game where, you know, I call you and ask you if you know somebody. You call somebody and ask if they know somebody. It really is important, especially right now, because things just really are changing daily. And unfortunately, a lot of the protections that were in place after the housing crash in 2008 aren't necessarily in place anymore. A lot of the laws are still there. They're just not being enforced. I know as of now there were three major lawsuits with three major financial institutions, couple of them being mortgage companies that had been called out right there were lawsuits because they were not only redlining and that that basically means that a lender is saying, I'm not going to lend in this area, this zip code for whatever reason, it's typically based on race or demographic, right? And then there was another one that was charging higher interest rates to different demographics. These were, you know, in the billions of dollars. Yeah, they were huge fines. They are gone. Yes, they just went away. Were dropped. Yes, those lawsuits were dropped. So again, it's all about how we're going to come together and take care of one another and protect one another. I think it's important. We'll talk more about it next week. We will, right? Yes, so I think that we're about out of time, aren't we?
Roland Daniels 28:57
We are just about out of time. So make sure you tune in next Sunday at 730 right here on K, U, N, V, 91.5, for more insights into making your mortgage work for you. Until then, have a fantastic Sunday and remember, stay true to your dreams. Stay true to yourself and your mind. Bye. You.