Subscribe
Share
Share
Embed
Hi, I'm Ella Gurfinkel, your host of the AskElla Show and senior loan officer at Fairway Independent Mortgage. On my podcast, I cut through the noise to bring you honest conversations about real estate, mortgages, and financial planning.
I interview industry experts to tackle everything from homebuying basics to complex topics like reverse mortgages, trusts, and market trends. With decades of experience, I'm passionate about dispelling myths and providing clear, actionable advice.
Whether you're buying your first home, refinancing, or planning for retirement, I'm here to help you make informed decisions. Join me for straightforward talk about real estate and beyond!
How policy changes will affect your mortgage and what you need to know. New policies could save you thousands on your mortgage or cost you big. Here is what's actually happening and how to prepare. Hi there, I'm Ella Gerfinkle, senior loan officer with 30 years of experience and over 2,000 families served over my lifetime. And if you think policy changes don't affect your mortgage, you're about to get a wakeup call. I've seen policy changes save clients $15,000 in down payment assistance. And I've seen other changes cost people their dream homes because they waited too long to act. The difference working with someone who tracks the stuff daily instead of reading about it on social media after it's too late. Just last week, I helped a client take advantage of a program that's getting modified next month. We closed just in time to save her $8,000. Meanwhile, her friend who was thinking about it missed the deadline and now has to come up with that money out of pocket. Now, don't like or subscribe until you get to the end of this video because I'm about to break down exactly what's changing, when it's changing, and how to position yourself to benefit instead of getting blindsided.
So, what is the policy impact timeline? What's actually changing? Let me cut through the noise and tell you what's actually happening versus what people are panicking about on the internet. First, let's talk about what's not changing anytime soon. The basic structure of mortgages, the 30-year fixed rate loan, FHA and VA programs. These are foundational programs that have bipartisan support. So, if you're worried that mortgages are going away, relax. What is changing? Several things. And the timeline matters. Loan limits are adjusted annually, usually in November for the following year. This affects how much you can borrow with conventional loans in different areas. In high-cost areas, these limits often go up, which is good news if you're buying an expensive home. Same actually applies to FHA. The FHA limits also change annually and also go up in the high-cost areas. Now the down payment assistance programs change more frequently. Some get more funding, some get cut, some get modified. I track about 15 different programs in my area and at least three to four change their terms every year. Tax policy changes can affect the mortgage interest deductions, property tax deductions, and first-time home buyer credits. These usually happen with major tax legislation, which means you typically get months of heads up warning. Credit reporting changes. These are ongoing discussions about how credit scores are calculated, which could affect who qualifies for what rates. These changes usually phase in over 12 to 18 months. The key is knowing what's coming and when so you can time your purchase accordingly. Rate implications, how policy affects your costs. Here's where policy changes can really hit your wallet through their impact on interest rates and fees. Federal Reserve policy indirectly affects mortgage rates. Let me say it again. Federal Reserve policy affects mortgage interest rates in an indirect fashion. When they raise or lower the federal funds rate, mortgage rates usually follow, but it's not a onetoone relationship. So, here is what most people don't understand and think the timing is immediate. Not so much. Typically, it's a trend line. Typically, the Fed rate goes down, the mortgage rates follow. Typically, it's not a quarter% cut to the Fed rate, an immediate quarter% reduction to the mortgage rates. That's not how that works. So, I track Fed meeting schedules and policy announcements because they can create windows of opportunity. Sometimes rates drop in anticipation of a Fed cut, which is actually what's going on right now, and then go back up after the actual announcement. The next Fed meeting is middle of September. So, the rates have already actually dropped in anticipation of the September rate cut. And knowing this timing can save you thousands. Let me give you an example. A year ago, the interest rates dropped to the low sixes on conventional loans on anticipation of a major Fed rate cut. What happened? The Feds cut the rate. They did the jumbo cut of half a percent, but the interest rates moved in the opposite direction. Not because of the federal rate cut. Not because the rates came down federally, but because a different report spooked the markets, and that was the jobs report. So, you want to work with somebody who knows what to expect, how to anticipate those expectations, and how the mortgage rates can move based on the combination of those. The government sponsored enterprise GSC fees is another issue. These are the fees that Fanny May and Freddy Mack charge lenders which get passed on to the borrowers. These change periodically and can add or subtract hundreds of dollars from your closing costs or your interest rate into your mortgage payment. For example, there was a recent, well, about a year ago, change to loan level price adjustments that made mortgages more expensive for buyers with higher credit scores and less expensive for buyers with lower credit scores. Most people had no idea this was coming, but I was preparing my my clients months in advance. PMI policy changes can also affect your costs. The rules for when PMI, private mortgage insurance, can be removed, how it's calculated, and what programs require it. These all change based on policy decisions. Program changes. There's new opportunities, there is modifications. This is where staying informed can literally save you thousands. New programs launch, existing programs get modified, and some programs get discontinued. There are always new first-time home buyer programs launching in different states, but with some offering down payment assistance. Those offerings come with a catch. There's only a limited amount of money available. So, you have to be the first of line because they're typically first come, first- serve basis. So that means that as soon as that program rolls out, you need to be there and you need your financing professional be there with you to assist you and keep you informed. Right now, I'm helping a client access a program in Phoenix that literally comes and goes as the money becomes available because as soon as they run out of the block of grant money, let's say 5 million at a time, they shut the program down and then they open it back up when the money comes back in. This is something that is fairly quiet and most people don't know about. It's not widely publicized that the funding only comes in chunks and every few months. So again, working with the right professional who knows how to get you there and get you the most money is the absolutely imperative task. VA loan changes, they happen periodically. Funding fee adjustments, eligibility modifications, loan limit changes. So, if you're a veteran, these changes can significantly affect your costs and options. FHA is constantly tweaking their programs. Mortgage insurance premiums, down payment requirement has been stable. The debt to income ratios have been stable. But even a small change in FHA policy can mean the difference between qualifying and not qualifying for thousands of buyers. Take this as an example. Just a few months ago, FHA has stopped all lending to anybody who is not a US citizen or a green card holder. So, if you were a DACA, if you were a legal HB1 visa holder, or if you had an EAD, basically employment authorization document, and you were an asylum seeker, you no longer have access to FHA. That happened fast and furious. We got about 3 months notice, and now it's gone. USDA rural development loans also change their eligible areas periodically based on the population growth. Areas that weren't eligible for zero down USA loan uh loans might become eligible or vice versa. Usually it's the opposite. Usually the areas get smaller. I track these changes because they can open up new opportunities for my clients. And something else that USDA does is changing their income limits on the annual basis and that opens up USDA financing for more people making a little more money. Tax implications, now this is the hidden impact. Tax policy changes might seem boring, but they can have the biggest of implications for home ownership costs and benefits. The mortgage interest deduction has been modified several times in recent years. Right now, you can deduct interest on a mortgage up to $750,000, but there's ongoing discussion about changing the limit. So, if you're buying an expensive home, timing could matter. Property tax deduction limits kept at $10,000 a year until recently and now with the passage of the big beautiful be bill, this amount has been increased dramatically. This particularly affects buyers in high tax states. Take New York, take California, Oregon, Washington, etc. for an example. Firsttime buyers sometimes are able to get tax credits, but those come and go. Sometimes there are federal credits, sometimes state credits, sometimes local credits. These can be worth thousands of dollars, but they often have limited time frames and funding. Capital gains exclusions for primary residences could potentially change as well, and that could affect your long-term wealth building strategy through real estate. Here is what most people miss. Tax policy changes usually have effective dates that give you the time to plan. If you know a beneficial program is ending or a tax advantage is being reduced, you can time your purchase to take advantage before the changes take effect. How I keep clients ahead of changes. This is where 30 years of experience really pays off. I built systems to track policy changes so my clients are never caught off guard. I subscribe to industry publications that track regular regulatory changes. I attend continue education seminars where policy changes are discussed. I am part of professional networks where lenders share information about upcoming changes. I monitor government websites where policy changes are announced. Okay. Yes, I'm a geek and I'm a policy wonk. There it is. I track congressional hearings and regulatory agency meetings where mortgage related policies are discussed. Again, I'm a geek. But here is the key. I don't just track changes. I analyze how they'll affect different types of buyers. A policy change that helps firsttime buyers might hurt move up buyers. A change that benefits the high credit borrowers might hurt lower credit borrowers. When I see a change coming, I proactively reach out to clients who might be affected. If a beneficial program is ending, I help them accelerate their timeline. If a new program is launching, I helped them position to take advantage of that. Last year, I identified a policy change that was going to make PMI more expensive for certain loan amounts. contacted every single client in my pipeline who would be affected and helped them restructure the loans to avoid the higher costs. Some saved over $2,000 a year. Let me tell you about Maria and Carlos. They were planning to buy in 6 months, taking their time, no rush, and I will never rush a client unless there was a good reason behind it. Then I learned about a down payment assistance program that was getting its funding cut in half. I called them immediately. We need to move your timeline up, guys. I said, "This program could save you $12,000, but the application closes in 60 days." They thought I was being pushy, but I showed them the policy documents, explained the timeline, and walked them through the math. They decided to accelerate their search. We got them pre-approved, they found a house, and we closed with 10 days of spare before the program's deadline. They saved 12,000 because I was tracking policy changes and they trusted my advice to act quickly. Look, policy changes are a fact of life in the mortgage industry. They happen constantly. They affect real people's finances and most people find out about them too late to benefit or protect themselves. The difference between saving thousands and losing thousands often comes down to timing and information. And unless you're reading Federal Register notices and attending mortgage industry conferences, you're probably not getting this information until it's too late. I monitor policy changes daily so my clients are always prepared. I don't just react to changes. I anticipate them. I plan for them and help my clients position themselves to benefit. Here is what I want you to do. Stop relying on random internet articles, Tik Toks, social media posts for information about mortgage policy changes. These sources are often wrong, always late, and never personalized to your situation. Book a consultation with me. It's free, always, and let's discuss how upcoming changes might affect your timeline and strategy. I'll share what I'm tracking, what I'm watching for, and how to position yourself for whatever comes next. Because here is the truth. Policy changes are going to happen whether you're prepared or not. The question is whether you'll benefit from them or be blindsided by them. If this video helped you understand why staying informed about policy changes matters, smash that like button, subscribe for ongoing policy updates, and comment below with any specific policy concerns that you have. I'll personally respond with the latest information that I'm tracking. Let's make sure you're always ahead of the curve instead of scrambling to catch up. I'll see you on the next one. [Music]