Morning! This is MF Lending - the chicken-mini of mortgage newsletters. We’re the fool-proof way to serve up mortgage and real estate market knowledge without any of the guesswork. So you’ll look like the smartest agent in the room (and you are!)

Here’s what we’ve got for you today:

1. Sellers Feel “Locked-In” By Low Mortgage Rates 🔐

2. 5 Ways Clients Can Avoid Wire Fraud 🥷

3. Half of Millennials are Homeowners | 25% Think They Will Rent Forever 🧮

By the way, this article on Buydowns Are a Nightmare is the most clicked link in this newsletter, you should check it out if you are interested.

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Nuwave Rates Today 📈

Half of Millennials are Homeowners | 25% Think They Will Rent Forever 🧮

Millennials recently crossed a homeownership rate of 51.5% in 2022 - the lowest of any generation.

However, one in four millennials plan to rent forever according to an Apartment List survey.

What are the biggest reasons why?

Homebuyers know that it is not financially risky and most are even ok with the maintenance costs.

They aren’t buying because they either can’t afford it, or think they can’t afford it.

Agents, if you are looking for content ideas moving into the summer - focus on the real numbers for buying a home. Focus on things like:

• How much cash is needed for the down payment and closing costs?

• Rent vs Buy comparisons - how is it compared to rent?

• What is PMI and how does it affect my payment?

• How to calculate your DTI ratio (without a lender)

• What are closing costs? How can I estimate these?

• 3 things you can negotiate for the seller to pay

Sellers Feel “Locked-In” By Low Mortgage Rates 🔐

I continue to say it - the pent-up demand in the market is at an all-time high and a storm is brewing.

According to a recent survey from Realtor.com and HarrisX, 86% of those planning to sell their home in the next 12 months are also planning to buy a new home.

However, the majority of these seller-buyers are feeling "locked in" by their currently low mortgage rate, with 82% reporting this as a major affordability hurdle. As a result, many seller-buyers are waiting for rates to come down before selling their home.

Despite the reluctance to take on higher mortgage rates, potential sellers have a ton of equity in their homes.

The survey found that 85% of potential sellers are content with the amount of equity they have in their homes. Specifically, 74% estimate they have more than $100,000 in home equity, and 20% estimate the number to be over $300,000.

Despite higher mortgage rates, sellers still have high expectations for their home sale. Somehow there is a major disconnect between sellers and reality.

Here are some wild stats:

• 33% of potential sellers think they can profit from the current market

• 43% expect to get their asking price

• 37% expect an offer within a week

• 35% expect buyers to waive contingencies

• 34% expect an all-cash offer

• 31% expect to get more than their asking price

• 27% expect a bidding war to occur

Given the changing housing market, it is important for buyers and sellers to have realistic expectations heading into a home sale.

Top Takeaways for Agents:

If you have buyers overwhelmed by the higher mortgage rates, make sure to connect them to a great mortgage lender who guides them through the process. It’s important to compare options like discount points, seller concessions, and seller credits to reduce the financial burden of purchasing.

5 Ways Clients Can Avoid Wire Fraud 🥷

Wire Fraud is becoming increasingly common in the US. Consumers lose $106,000 on average to wire fraud per incident.

Here are the best ways you can advise your clients to avoid wire fraud.

1. Verify wire transfer instructions by calling your escrow officer or attorney directly.

   Cybercriminals can intercept emails and redirect wire transfer instructions to their own accounts.

2. Check email addresses carefully to ensure that they are legitimate.

3. Be cautious of last-minute changes and verify them with your contacts.

4. Use a secure network when communicating about wire transfers and avoid public Wi-Fi.

5. Be cautious of unsolicited emails, phone calls, or text messages requesting personal or financial information. Don't provide any information until you can verify the identity of the sender.

With this, you can help protect your clients during a home purchase and avoid falling victim to wire fraud.

Stay vigilant and always verify wire transfer instructions with your contacts 🙂 

The Cul-de-Sac

Thanks for reading - that is all we have for today 😎

Please forward this to your friends and colleagues if you found it valuable.

— Michael F DiLucchio