What are the requirements for the USDA program in Edinburg? So that’s going to be looking at a 640 minimum credit score requirement.
There is a income requirement too when applying for a USDA Loan Edinburg.
So basically the income requirement is about 78,000 if you’re in a family of 1 to 4 if you’re in a family of 5+ that’s gonna go up to about $103,000 on the income limit.
The big requirement for USDA is that it’s property specific.
It’s got to be in a USDA Approved Zone. How much down payment does this program require?
It’s actually 0% down payment which is Great!
Ok Awesome, and how much does the average home buyer come in with out-of-pocket?
So because your down payment for a USDA Loan in Edinburg is covered you’re just gonna have to come in with again your prepaid and closing cost So if it was a $300,000 purchase.
you’d be looking at about $7,500 cash for keys to get in the home.
What type of home buyer is the USDA Loan program Ideal for? So this is going to be ideal for the home buyer that’s looking for a property in those specific areas.
Ideally it’s properties that are going to be USDA Eligible rural zones.
So not right in the middle of the city, but maybe if it’s more on the outskirts, on a little bit of land, lower tax rate areas that’s probably going to be a property that’s eligible and that would be ideal because that one would probably qualify OK, Fantastic.
What is a USDA Home Loan?
I bet you’re wondering, what is a USDA home loan?
Designed with the residents of more rural areas in mind, the United States Department of Agriculture designed its loan program to enrich rural communities by providing affordable home loan options to low-income households that may not be able to secure home financing through other means.
Who has time to stop and smell the roses? You don’t, and this isn’t even a rose.
What are the requirements for the USDA program?
So USDA has a few interesting requirements First of all, you’ll need to have at least a 580 credit score Some lenders require a 620 credit score.
Your household income has to be under the county maximum Like a lot of down payment assistance programs. This is based on family size So 1 to 4 is one category and then 5 and above is a higher threshold for qualifying
What’s unique about this one is the home has to be within a designated area.
So, Typically what that means is.
NOT within a metropolitan area So within our area here (Riverside county) Our local cities around her don’t qualify But we only need to go 10 miles away to where there’s an open area where there’s Several homes that qualify.
USDA stands for United States Dept of Agriculture But it’s NOT a farm loan.
Specifically, they don’t finance this program for farms in Edinburg.
It has to be a Single Family home in the Edinburg area, without a barn structure on the property.
Then it also has some home price limitations.
The Threshold is a little bit lower than say an FHA loan for the loan limits.
Ok, and how does this program differ from other Down payment programs?
So it’s different because it’s not really a down payment program but it allows financing up to a 100% of the purchase price And it’s interesting because you can actually use this program with 1 or 2 of the other programs.
If you need closing cost assistance But, what’s unique it’s a 100% Financing so you don’t need a 2nd or a 3rd lien on the property.
Your interest rates are typically lower than if you combine it with a down payment assistance programs and you don’t have to repay any down payment assistance.
It has a monthly factor It’s like mortgage insurance upfront It’s financed at a monthly component.
Much less than FHA So if you can qualify for this program It’s better than FHA And As I mentioned, rates and payments Are typically lower on this program So USDA is really a great program.
And on average How much does the home buyer have to come in with out-of-pocket?
So Again, we are financing the whole loan Purchase price up to 100% So the only thing remaining is then the closing costs Typically, plan on around 3% of the purchase price for funds to close.
The question there then becomes, Well, Where does that come from? Typically, we ask the seller to cover those costs And if we can get the seller to cover 3% Then, the buyer may only need to come in with an earnest money deposit.
And they may even get most or all of that back.
If the seller is covering all the fees.
One unique feature about USDA Versus all other loans is that if the home appraises for more than the purchase price.
We can finance the closing costs up to that appraised amount So, no other loan I know that we can actually finance the closing costs.
What type of home buyer is this program ideal for?
So certainly those that don’t have access to money for a down payment Anyone that wants to live that doesn’t have to live within a metropolitan area because, again, the house has to be in an area that is not in a high densely populated area.
It’s also suited well for people who have some credit issues and anybody that qualifies for this program would definitely be better served than going FHA so those type of people.
And besides the Area restrictions are their any other property restrictions? So property restrictions are going to be similar to FHA They’ll do manufactured homes.
They’ll do homes with Casitas So no real other restrictions.
Just if it conforms to the FHA guides then it should qualify for USDA There’s a couple little quirky things that you don’t run into very often like you can’t actually have a barn on the property It definitely can’t be for agricultural purposes It has to be for residential purposes.
USDA Loan Edinburg – Do You Pre-Qualify?
- So the company wasestablished back in 2008, by Vance Hillstrom and Doug Watson, right now we're at abouteleven people in total, our back office and then sixcells guys in the outside.
My role in the companyis originating loans so at the moment we haveover three hundred and twenty accredited investors in our fund, so we are a direct lender,we're not syndicating any portion of your fundthat are gonna be provided, so being a direct lender,we do have the flexibility of speed, although everybody gets tied up, how quickly can you close,it really comes down to the preliminary titlereport, if it's a clean prelim then of course wecan move a lot faster, but in some cases I comeinto the middle of a deal where the previous lender couldn't close, and then there's ten items listed on the preliminary title report,so that slows things down but then again being direct,we can get back to you with a letter of intentwithin twenty-four hours, we can get out to theproperty, if we engage in a transaction within seventy-two hours, why I say that is, forexample if we get the deal on a Friday, then we'llprobably be out to the property that following Monday, butif we get it on a Monday we'll probably be out to your property on a Tuesday, or Wednesday at the latest.
- [Interviewer] So you do site visits for every single loan ? - Yes, we do come out to everysingle property we lend on.
- [Interviewer] And then whotypically does the site visit ? - In most cases, Vance, but you know, sometimes people go with Doug, but if it's multiple propertiesthat we're looking at they'll probably splitit, like we did a deal recently where one propertywas down in Carmel, and the other property was by Tahoe, so they split it up, to notdrive the whole Bay area.
- [Interviewer] So one of thetwo principals has to go look at the subject property ? - Yes.
- [Interviewer] So overall,what are the mean benefits of doing business with Rubicon, as opposed to anotherprivate lending company ? - We are local, here in the Bayarea, so that's a huge plus, how we set ourselves apartis being very transparent with our borrowers, both ourborrowers and our investors, if a deal doesn't makesense we'd rather just tell the client right awayit doesn't make sense, and we'll point themin the right direction or simply back off.
Speed is another greatfactor, again if it's a clean preliminary title report, if it's a clean property we'regonna close quickly.
We do have a good understandingon each sub-market and if we don't, we have contacts that we can reach out to andget down to the number quickly.
- [Interviewer] And noappraisals, of course.
- Of course, no appraisals,so that speeds things up if you have one, great, if youdon't, we don't require one.
Rubicon Mortgage Fund | Northern California Bridge Lender
- One of the things we wantedto talk to you, Gary, about was - we focus on bringing value to the agents and doingdirect to consumer.
So, we're doing two different models-- - Of course.
- So one of the thingsthat we are going in on is: a third of the buyers are now millennials.
- In our markets, andof those millennials, all the things we learnedover the past 10 years on marketing actually arepushing these people away.
Right, so we're toldto, when a lead comes in call them x number of times over this period of days and blast them-- - There's not a single personthat wants that phone call.
- No, nobody answers the phone.
So, they actually will fill out an inquiry on a lead page or something and they'll say they're interested but when we call them, theydon't answer the phone.
- What about texting them? - So that's what we've been doing.
I've noticed a littletip: like emails weren't getting opened in personal email boxes.
Work emails are getting opened, but personal inbox has become a wasteland.
- That's right.
- So I've been texting video clips through the service called BombBomb, and then also justsending quick texts asking when they would like totalk, and it's working-- - Imagine talking to people the way they want to be talked to.
- So like, is that what you believe.
what are your thoughts on text? - I'm ALL IN on text.
- I'm very bullish on text,it's why I have first in line.
And I believe in it the most.
Notice how I said, "what about text?" Text.
- So you think in terms ofbuilding a subscription model.
- If you added what your Instagram handle in your lead gen form andsaid in little parentheses "we will follow you on there" and DM you if we're unable to get to you by phone-- - [Neel] Yeah.
- You'll get everybody.
- [Neel] Yeah, and then-- - What you should reallydo on your lead gen form is how would you like usto communicate with you? E-mail, phone, InstagramDM, come to your house, smoke signals, write you a letter? You get a lead gen andthen you've decided through tried and true practicesfrom the 19-fucking-70's this is the industry now to communicate with them butthey don't want to communicate.
If someone called me I would be upset.
I'm upset when people call me.
- [Neel] 'Cause youdon't want a bandwidth-- - Because there's technology.
It's called text me and I'llget back to you when I can.
Not you call me on my time.
We value time.
You should make the leadgens predicated on not just, you should absolutely askthem upfront aggressively how would they like to be talked to.
If you say, we acknowledgemany people now communicate in different forms, how would youlike to be communicated to, one two, pull down, e-mail and Instagram, call and handshake, letter and telegram.
- [Neel] Makes sense.
- It will work.
- [Arjun] And with millennials that's-- - And there's old schoolmillennials that want a phone call.
And there's a 73 year oldgrandma who's hip as fuck.
(Arjun laughs) - Yeah.
- Individuality to how they want it, not just millennials do this, got it? And you have that ability.
That's how the form should be set up.
- So you actually built aservice of--and then for texting is that something they have to opt in for? - Yeah.
- Big time, like, you get theirthing then they gotta opt in and confirm because it'sa very sacred ground.
- It's not a spamming place.
- No, it is not.
Okay, and isthere anything else that you can give us as far asmarketing to this demographic which is becoming a biggerportion of our buyers? - Look, I mean, they'recynical to marketing.
They don't want the fucking-- - [Neel] They don't wanna be sold.
- They don't want thehotshot, I got a Lamborghini and a suit and I'm your real estate guy.
They want authenticity, theywant contextual creative where they live, you know? They want information, they want value, but they're like any other human.
They either wanna beentertained or informed.
Right? - [Neel] Yup.
- [Arjun] Makes sense.
- It's basic, but the problem is you can't run an infomercial anymore.
They don't carethat--there's no 27 year old that thinks it's cool thatyour face is on a bench.
(Gary laughs) - I mean literally when I seea real estate agent's face on a bench I'm like thatperson is definitely dead.
- [Neel] We'll go on thefreeway and see a billboard where somebody just put up their face and I'm like that's for you,it's not for anybody else.
- 100%, and that's fine too.
- Yeah, that's cool.
- Like, Mazel Tov, enjoy, Iput my face on a billboard back in the day, it's fun, I get it.
The part where they reallylose, believe it or not I'm a little bit funny with outdoor media.
The same billboard cansell for $20,000 and 2,000.
So my opinion changes on that.
- [Neel] So there's a price but it's just not what they're asking.
- Correct, so billboardssell in a funny way.
You'll sign a six month contract and they couldn't sell it to someone else so now the month is there,now they're scattered, they don't want an emptyboard so you can buy it for 2,000 just for the month.
So I like that billboard, here's where I getscrewed up: the content.
So now you've got thebillboard at the right price.
I'll take it.
Yeah, every passenger islooking at their phone, Yes, I don't think billboardsare as good as they were 30 years ago, but you giveme a $20,000 board for 2,000, right, everything's got a price.
- [Neel] Yeah.
- That's how I think aboutmedia, but then creative.
The problem with most real estate agents when they get a billboard is they take their most stock image in a good suit.
Nobody wants to talk to you, Barry.
- [Neel] Yeah.
- [Arjun] Yeah.
- 1-800-Barry will helpyou is fucking 1987.
Why don't you put a billboard that says every other real estate agent sucks? And wear that awesome shirtthat you're wearing now and that will convert way better.
Even though some peoplehate that you said "sucks".
I know what every single banking and lawyer outdoor billboard looks like.
It is a person in a suitwith a tacky phone number.
Can't break through.
You've never seen it becauseyou're so used to it.
- Yeah, it's vanilla.
- Yeah, it's the same thing-- - You get somebody with a Faze Clan hoodie saying "I'm a lawyer andevery other lawyer sucks" and put a phone number they'regonna cream up 22 to 30.
- [Neel] Yup.
- 25 to 35.
Right? - [Neel] Yeah, that makes sense.
- [Arjun] Real estate and mortgage, both these industries moving forward with everything that'shappening in technology and how they're having to adjust to pivot which one feels the impact more? - Both because they're so inherently tied together, you know, both.
- The middle gets eliminated on both.
- Yeah, tech will eliminateeverything in the middle.
Glass doors, people will tell you those sunglasses got eliminated.
- [Neel] I bought these from Warby Parker.
- Correct, you used to goto fucking Sunglass Hut.
- [Neel] Lenscrafters or something.
- That's exactly right.
Got it? The internet wins, welose, now figure it out.
- If you're in the middle you're finished.
I really believe that.
Nowthe question becomes, when? I'm right about that.
- [Neel] Mhm.
- But if I said this in 1994and you owned a bookstore you'd be like, you got called out first.
Bezos came along.
If you were a taxi cab driverand you watched this video for some reason because it hityour fucking Instagram feed and you're like, I run an Internet taxi in 2009 you're laughing at me,that kid doesn't know shit.
And then Uber put you out of business.
- [Neel] Yup.
- The internet will puteverybody out of business if you don't build something defensible.
The only thing that'sdefensible is the best product, the best, and this is thescary thing for people because now they hearthat and they're like, well I'm the best, no you're not.
The best product that's differentiated.
You're just a real estate agent.
There's plenty of people thathave done it for 27 years too.
Or they could be LeBron and Kobe.
I have a funny feeling if I decided to be a real estate agent next year even with my lack of experience that I'd be really good at it.
(Gary laughs) - [Neel] Is that why you got Liz into it? - No, my sister got into it because she always wanted to doit, I mean, I pushed her to make the jump and supported her as she navigated inevitably what a lot of stay-at-home moms navigate which is, you know, you feel a level ofguilt that you wanna do it.
She grew up in an Eastern--Iknow what household she grew up in, onethat's very traditional, Eastern European, momstays home, you know? - [Neel] Yeah.
- So she had to go through her own shit.
The part that I pushed Liz onis her content on Instagram is "I suck, I haven't sold shit.
" - [Neel] But it's real.
- That's gonna lead to allour business, you know? - Yeah, it makes sense.
- It just seems like justbeing at this conference there's a disproportionate amount of people in a higher age bracket.
People are in realestate and mortgage for, we have no young people in our office, it's all older people thathave been doing it for a while.
And I think they get stuck on-- - Well, everybody's introuble with young right now because everybody young thinksthey're Mark Zuckerberg.
[Arjun Laughs] - [Neel] You can't hire anybody young.
- You can't hire anybody young 'cause they're all starting companies.
We need the economy to collapse.
Then you'll get young.
- [Neel] Yeah.
- When everybody realizes theirdirect to consumer kombucha is not going anywhere,they're going to get a job.
- [Neel] Yeah.
- [Arjun] Punched in the fucking mouth.
- Punched in the fucking mouth.
- [Neel] But theseguys, for a lot of them, everybody is kind of plagued by the shoulda, woulda, coulda's'cause they're in the older part of their life and it keeps them back from future opportunities a lot of times-- - Of course.
- But I saw a piece ofcontent of yours a while back, I don't know, mixed insomewhere that said, you were talking again about how you could have invested in Uber-- - Yes.
- But you don't get yourself hung up on it because you could have doneit and then got hit by a bus.
- I'm glad you--did youlike that piece of content? Super interesting, right? - It just hit me 'cause I'm like, all the mistakes I madebefore, it let you to where-- - It got you to where you are now.
- This is the reason whyyou're at where you're at.
And use that as your fuel to go forward.
- Yeah, and by the way, Icould have been way better.
I mean, I'm prettysmart, that 400 million, it could be great, it could be great.
But it didn't happen.
Until somebody shows me a time machine my ability to look back anddwell is going to be zero.
- Yeah, makes sense.
Let me thank you for doing this too, man.
We got a ton of wine onthe way, I think, so-- - Yeah, what are you gonna do? - He's a big wine guy, I'm not.
- This is why I'm so excited about the barter I did with wine.
- It's a win-win.
- Yeah, but it was always a win-win.
I always loved when I didbarters for books, sneakers, any time I'm sellingsomething I want to barter because I want it todo well and I know that access to me is very valuable'cause you can't get it.
So I always knew I hada market and obviously as I've gotten biggerthe market gets bigger.
I mean, some of theshit I did for Crush It, like buy five books and I'llbe your best friend for a year, I didn't have the same leverage.
So anyway with books what Iwatched a lot of people do was they would buy a thousand books and put it in a warehouse.
Because they just wanted my time.
Maybe they gave away a couple but I don't blame them, they're busy.
If you can buy 1000 booksyou're probably busy, you know? So they're like, thebest use of their time was to put them in the corner.
Wine's going to be different.
Wine, people are gonna do shit with.
'Cause it has a natural currency in our society that's better than a book.
- [Neel] 'Cause clients love it.
- [Neel] Agents love it.
- And then for me, it wasalways--once I ran the math, buy 4,000 sneakers was worthwhatever I was doing for you.
Buy four sneakers was worthwhatever you just bought, I decided was worth it based on how much pressure I felt to sell it.
What's interesting aboutthat, though, is I'm like, hm, this actually mightreally work for me.
Because I did the trade that was worth it but the backend has more of a residual.
You're going to give it to clients.
They're gonna fucking love it.
They can't get itanywhere else besides me.
It's a direct to consumer brand.
- [Neel] Could be in retail.
- So they're gonna go tothe website and order it.
It's just gonna travel better than books.
- [Neel] It works better, yeah.
- Easier to enjoy right away.
- And I'll tell you, andI'm very proud of this, it's a $40 wine for 20 bucks.
- That's fantastic.
- So my hope is that peoplewill be able to taste it.
It's a big Delta.
- That's awesome, man.