VanDyk Mortgage - April 2021

APRIL 2021

Letters From the Hart Give us a call! 239-437-4278 Or visit www.TimHartJr.com Corporate NMLS #3035 www.nmlsconsumeraccess.org

When Is the Time to Lock Your Interest Rates? ON LOCKDOWN

This might surprise many readers right now, but after a couple of amazing years of decreasing interest rates on home loans — we just keep saying “They won’t go lower than that,” only to have rates do exactly that — we are right now in a “rising-rate environment.” For the first time in a long time, rates are starting to go up, not down. And that has a lot of borrowers second-guessing the rate being offered to them on any given day, which means people are waiting, gambling, and stressing themselves out over something that I don’t believe is worth it for most homebuyers. Look, I do understand. It’s hard to swallow a 3% interest rate this week when it was 2.75% just nine days ago! Furthermore, it’s easy to say, “Well, I’m going to wait a few days and see what happens — I bet the rates will go lower again, and I should

really make sure before I lock them in.” Meanwhile, their closing date creeps closer and closer, and they still don’t have rates locked in.

rise consistently for a while now, long enough to know that the long-term “lowering rates” trend of the past few years has played out, at least for the moment. So, while waiting to lock in your rate until it drops back to 2.75% might work, odds are that the rate will actually go up in that time period, not down. Again, I get it. Closing on a house at a 3% rate when your buddy just got 2.6% last month seems like bitter medicine. But is it as bitter as waiting, only to discover that rates have gone up? That is the question we really need to ask: What happens if, instead of dropping, rates go up? Are we going to keep waiting and let that closing date draw ever closer? Next week, you could be sitting at your desk, head in your hands, asking yourself why you didn’t close on 3% when you had the chance. I wish I could tell you that this doesn’t happen, but then I’d be lying to you — and as the expert you ask to help you with your mortgage, that’s not what I want to do. Instead, I want to give you some helpful advice that will make things easier on you as you close and maybe leave you with some peace of mind, instead of leaving you second-guessing if the rates will go up or down. So, here’s what I would do: If I were buying a house in today’s market, and I was happy with everything else about

Why is this a bad idea?

The biggest reason is that in a rising-rate environment, rates today will generally be lower than rates tomorrow. I’d liken this to playing the house when you play blackjack. You might win a hand or two, but if you sit there for long enough, the house will start winning. It might not win in every instance, but averaged out over a period of time, the house makes money — and everyone else loses it. With interest rates, it’s the same situation. Rates last week might have been 2.75%, and they might reach that low next week, too. But we’ve seen rates

CONTINUED ON PG. 3 ...

VanDyk Mortgage | www.TimHartJr.com | 239-437-4278

Page 1

GET IN SHAPE FOR YOUR NEXT BACKPACKING TRIP 3 Essential Areas to Focus On

Backpacking in the mountains puts a fun twist on the standard campout. By packing all your gear miles from the nearest roads, you can leave the whole world behind and just exist in nature. That said, backpacking can also put a lot of strain on your body — unless you properly prepare for it. Peak backpacking season isn’t too far away, but it could take a couple of months to physically prepare for your next big trip. So, now is the perfect time to start working toward some of the following fitness goals: Increase Muscle Strength and Endurance Your leg and core muscles, as well as your shoulders and lower back (to a lesser extent), will do most of the heavy lifting when you’re hauling a 30–50-pound pack up a trail. With that in mind, you should devote two nonconsecutive days each

week to strengthening these muscle groups. A few good exercises to increase leg strength are jump squats, single-leg deadlifts, step-ups, and hip rolls. A simple way people can increase core strength is by doing planks. Improve Your Cardio Health Backpacking includes a lot of walking while carrying heavy weight at a high altitude, which means it’s just as important to get your cardiovascular system into shape as it is to strengthen your muscles. Dedicate three days each week — alternating with your strength training days — to building your cardio health with activities like trail running, biking, swimming, or other aerobic exercises. Improve Your Balance Backpacking trails are rough, and you'll need good balance to navigate obstacles

and step over boulders, creeks, and large roots. The good news is that increased strength and balance go hand in hand. Building up the muscles in your legs and core will help improve your balance, as will taking walks or runs on uneven trails or terrain. These are just a few quick tips to help you get in shape this backpacking season. For more in-depth instructions, check out CleverHiker.com, Backpacker.com, or search “How to Train for Hiking” on REI. com. Happy hiking!

2 Simple Budgeting Strategies You Can Implement Today No Spreadsheets Required

Paying off debt and saving money are the building blocks of a healthy financial life, but the statistics are dire: One-third of Americans haven’t saved a single penny for retirement, 38% of households have credit card debt, and 44% don’t have enough cash saved to cover a $400 emergency expense. If you see yourself in those numbers, there’s no better time than now to start working on healthier financial habits because April is Financial Literacy Month. Even with myriad apps available to help, budgeting can still feel intimidating. So, why not keep it simple with these two systems you can implement today? The 50-30-20 Strategy Before she was a U.S. senator, Elizabeth Warren was a tenured law professor at Harvard, specializing in bankruptcy. During that time, she published the widely acclaimed personal finance book, “All Your Worth: The Ultimate Lifetime Money Plan.” Some 16 years later, her advice still holds up. That’s because Warren’s approach to money is simple and flexible. She suggests allocating 50% of your income to needs like housing, groceries, and utilities; 30% to wants like entertainment, vacations, and eating out; and 20% to savings, which starts by building a

three-month emergency fund and then allocating savings to a retirement fund thereafter. If you have credit card debt, Warren suggests allocating that final 20% to debt repayment before you start saving. Otherwise, you’ll just backslide as interest mounts on your existing debt. If you’re able to save more than 20%, adjust the ratios accordingly. If you can’t save 20% just yet, start with less (even 1% each month adds up!) and make a goal to increase your savings by 1% each month or quarter. The Anti-Budget Strategy If Warren’s budgeting strategy feels too complicated, try financial expert and “Afford Anything” podcast host Paula Pant’s anti- budget. Each time you get paid, skim 20% (or whatever your current savings goal is) off the top, put it in a savings or retirement account, and spend the rest however you’d like. Pant’s logic here is that if you tell yourself you’ll save “whatever’s left over at the end of the month,” you’re unlikely to save anything. Free yourself from the worry by saving first, then spend the rest guilt-free.

If 20% feels like too lofty a goal, start with whatever feels doable and work to increase that by 1% each month or quarter.

VanDyk Mortgage | www.TimHartJr.com | 239-437-4278

Page 2

... CONTINUED FROM PG. 1

... CONTINUED FROM PG. 4

than people are used to, and when it’s all done, they have to live with the consequences — literally! When someone comes in to see me, they’re usually stressed to the hilt, so I want to help them feel better. But I can’t do that if I’m just doing what works for me, because they might not share my language. Funnily enough, in a couple, I often see that they don’t share each other’s language, either — the old rule that opposites attract is true, at least in my experience. I may not be able to speak someone’s language exactly, but learning what they like and what they dislike at least helps me avoid antagonizing them or stressing them out! What’s your language? Is humor a big part of it? I encourage you to think about it and try to notice the same traits (or differences!) in others this month. You’ll feel more connected to your fellow man, and you just might make someone feel better, too.

a home that I had found, I would lock in the interest rate as soon as I could. "If you like it, lock it" is one of our mottos. It’s easy to forget that a 3%–4% interest rate is historically low; anything under 3% is phenomenal. Four years ago, you’d never have considered “holding out” for a 2.75% rate! A lot of things have changed in that time, but that one hasn’t. Instead of focusing on the rate, focus on finding the right house, in the right neighborhood, and borrowing from the right lender. Far more important than your interest rate is whether or not you can make the monthly payments and whether or not you are going to be sitting in a house that you end up disliking. Those are all things that you have control over. The interest rate is like the stock market or the weather. Maybe someone out there can predict what will happen, but it won’t be me or you. Some borrowers won't take this advice, and that’s okay, too. Just make sure that you let your loan officer know you’re going to roll the dice and go ahead and pick their brain on what they think the rate will do. They’ll have

a better idea, and they can also counsel you from their large pools of experience. But don’t be surprised if they say the same thing that I am, because like the stock market and the weather, the mortgage rate is controlled by outside forces that we can barely predict, nevermind influence. For an example of that, look at 2020 — at this point, we’re all familiar with forces like those! Homebuying can be a stressful experience, but it should also be a rewarding time. Don’t hurt yourself waiting for a rate drop that may never happen. Instead, search for the house you love, find a borrower you can work with, and let providence take care of the rest. Enjoy the process, if you can, and no matter what — don’t make it any harder than it has to be. If you like it, lock it and don’t think twice about it. If you have any questions about rate drops, rate increases, or anything else, give us a call at 239-437-4278.

NMLS #354676

SUDOKU

Solution on Pg. 4

TRIVIA QUESTION: What is Tim's motto about locking rates?

VanDyk Mortgage | www.TimHartJr.com | 239-437-4278

Page 3

PRST STD US POSTAGE PAID BOISE, ID PERMIT 411

Tim Hart, NMLS #354676 8280 College Parkway, Suite #101 Fort Myers, FL 33919

Give us a call! 239-437-4278 Or visit www.TimHartJr.com

Inside This Issue

Interest Rates: To Lock or Not? PAGE 1

Get in Shape for Your Next Backpacking Trip

2 Easy, Effective Budgeting Strategies PAGE 2

Testimonial From the Hart PAGE 3

It Pays to Read People Closely PAGE 4

It Pays to Read People Closely MY ADVICE?

I’ve always thought of myself as a “people person,” but I didn’t really understand what that meant until I’d been working in the home loan business for a few years. Most folks say that and mean they like to be around people and feel energized from those interactions. That’s true for me, too, but I’ve learned that a big part of it is learning to read people and taking your cues from them. I think some people do have a natural talent in this area, but even if you don’t, it is worth developing. It allows me to “speak the language” of the people I’m working with, and that can really pay off in the long run. Now, when I say “speak the language,” I don’t mean literally. I mean I try to see how someone thinks about the world and what their communication style is. This is something that I first noticed when it came to humor: I’ve always had a pretty good sense of humor, even as a kid. For the most part, I found that humor is a good way to

break the ice and take the stress out of a stressful situation. Whether I was helping my baseball team get through a tough practice or helping a stressed-out homebuyer during a tense back-and-forth process, humor is often a go-to tool for me.

Except, of course, when it isn’t.

One in a while I’d meet someone who I just knew wouldn’t appreciate me cracking a joke, even occasionally. Did that mean they just didn’t have a sense of humor? That might be how they came off, but I knew something else was going on. They just didn’t communicate that way, and when someone makes a joke during a high-stakes process like homebuying, they wonder if that person is really taking things seriously. Their communication style just doesn’t involve much humor, and I knew not to push humor on them.

From there, I learned to pay attention to other styles and differences in communication. Does this person use lots of gestures? What’s their body language indicating? Are they a face-to-face person, or do they seem like an introvert who’d rather this whole conversation be over soon? As a business owner, I think I owe it to my clients to learn this kind of thing. In my own job, homebuying is a stressful process and it lasts for 30–45 days in most cases. There’s a lot on the line, usually more money involved

CONTINUED ON PG. 3 ...

VanDyk Mortgage | www.TimHartJr.com | 239-437-4278

Page 4