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Yes, mortgage influencers exist —here’s their top financial advise

TikTok is a platform where you can sing, dance, and Now it’s a mortgage.

Among the popular social media app’s 170 million U.S. users are homebuyers who need a loan, and like many others looking for quick entertainment with a bit of information they’re turning to TikTok’s mortgage influencers.

for example, TikTok Videos“If you’re thinking about buying a home in 2024, you need to pay attention to interest rates,” one man said.

The speaker is a loan officer who goes by a pseudonym. Followhas hundreds of videos covering all sorts of mortgage and financial advice, from setting up a housing trust to buying a home with your parents.

He’s just one of many “mortgage influencers” offering advice on the platform – but can the advice be trusted?

To find the answer, we scoured TikTok to find the best mortgage videos on the platform and asked mortgage experts for their thoughts.

What the pros think about TikTok advice

Jerry Devlin of Assume Loans, a Brookline, Massachusetts-based firm, says many TikTok videos help explain the dos and don’ts of home buying.

“It’s particularly useful for reaching the younger, first-time homebuyer demographic, who may think home buying is out of reach,” he says.

But Devlin points out that not all videos are useful or accurate.

“I especially don’t like people who ‘predict’ what interest rates or house prices are going to be. In my opinion, they’re irresponsible,” Devlin added.

Richard Redmond, mortgage broker and author of “Mortgages: An Insider’s Guide,” adds that social media videos shouldn’t be a buyer’s only source of mortgage information.

“Buying a home is likely the biggest purchase of your life, and how you finance it may be the most important financial decision most people make,” Redmond says. “It’s worth taking the time to become educated and make an informed choice about whether or not to take out a mortgage.”

Redmond adds that buyers should speak to at least two lenders, ideally a mortgage broker and a banker, who should be “experienced, have references from trusted sources and have great reviews online.”

The new trend on TikTok is mortgage influencers. thatlenderbecca/TikTok

So while TikTok videos aren’t the start and end of your financial education, they can be a quick, accessible, and even fun way to prepare for homebuying.

Here are some TikTok videos worth checking out:

1. For buyers who find the mortgage terms unclear

In this clip, Texas mortgage lender @thatlenderbecca highlights how many buyers don’t understand some of the industry’s jargon.

She speaks to the camera, but gibberish is layered over her words.

“The words my clients hear when I forget they can’t talk about their mortgage,” the text reads.

If you’re not sure what basis points or jumbo mortgages are, it’s a good idea for buyers to at least understand some of the key terms. Here’s a helpful guide.

2. For buyers interested in the future of mortgage rates

The other video discusses inflation and interest rates following the recent Federal Open Market Committee meeting, where the Federal Reserve decided to keep short-term policy rates unchanged in the 5.25% to 5.5% range.

“While this news is not good for homebuyers, it could have been a lot worse with interest rates remaining unchanged,” the video states.

Devlin says the poster, @thatmortgageguy, is a mortgage banker with hundreds of videos and more than 800,000 followers, and is “one of the most influential people in his field.”

He adds that @thatmortgageguy covers mortgage news while also educating, making it a great account for keeping people up to date on the latest developments in the housing industry.

3. For buyers who are concerned about price

Speaking of interest rates, @buynotrentguy recently posted a video about whether homebuyers should wait for interest rates to drop or jump into the market while rates are still relatively high. He said home prices will likely rise once interest rates finally fall, and he encourages buyers not to delay.

“People who buy now can stay in their homes while they wait for interest rates to come down,” he explains in the video. “When interest rates go down, home prices go up, and your equity increases while you wait. Then you can refinance at a lower interest rate.”

Pro opinion: Redmond says that’s good advice, as long as interest rates actually fall.

@Buynotrentguy says that home buyers marry the home, but should also consider the mortgage date. Christopher Sadowski

“This advice is basically, ‘Marry the house, marry the mortgage,'” he says, referring to a popular home-buying strategy.

Homebuyers shouldn’t rely on forecasts, he adds: “Interest rates are notoriously difficult to predict. … It’s like using a Magic 8 Ball.”

He recommends a more cautious strategy: “When financing a home purchase, you should be confident that you’ll be able to make the mortgage payments even if interest rates don’t fall.”

4. For buyers who are concerned about whether the loan estimate is the final price

“Mortgage officers are getting pretty desperate.” @the.mortgage.mentor It starts with one post.

In the video, she says the market is tough for everyone: buyers, agents, and lenders, with some lenders “using some pretty shady tactics” to get buyers to work with them and “significantly understating” loan estimates. (A loan estimate is exactly what it sounds like: a document that projects expected closing costs, monthly payments, interest rates, and more.)

“Surprise is nice, but not when it comes to buying a home,” she says. “The last thing you want is to show up to the closing table and be shocked to find you have to pay $2,000 extra.”

Pro opinion: Redmond reminds buyers that @the.mortgage.mentor’s assertion that loan officers are “desperate” is a generalization.

“Some lenders do lie, but most are too concerned about their online reputations to make it a habit,” he says. Proper Loan Estimates are designed to protect consumers, and they’re extremely valuable.

5. For buyers who want to know how to provide proof of funds

In a video posted by one loan officer, translation:It recreates a scene from “The Office” in which one character repeatedly asks another, “Where are you?”

While one TikTok influencer said mortgage lenders are desperate, experts at Realtor.com say most lenders are focused on customer success. Christopher Sadowski

Above the clip, text reads, “POV: Loan officer asks where you keep your down payment money.”

Below, a TikTok user explains that purchase funds should be in a checking or savings account, gift fund, or 401(k), not cash.

Although this video doesn’t touch on this, it is generally not recommended to invest your assets in mutual funds or stocks, as these money cannot be easily withdrawn and the amount can change rapidly depending on market conditions.

When presenting an offer letter, home buyers must also submit a proof of funds showing they have sufficient funds to purchase the home.

6. For buyers who want to know how to pay off their mortgage early

Josie Luiz Morales (@joseluizmorales805 on TikTok) is a real estate agent and investor from Ventura, California who posts about buying, selling, and finances.

Experts say that while these videos can be useful, they shouldn’t be users’ only source of information. joseluizmorales805/TikTok

One video explains how you can pay off a 30-year mortgage in 15 years by increasing your monthly payments.

“Banks won’t tell you this because it makes more money from you,” he said in the video, before explaining how homeowners can pay off their mortgages earlier by paying 15% more each month.

Pro take: Redmond explains that if you can afford to make a higher monthly payment, you can actually pay off your mortgage sooner.

But Morales’ claim that banks “won’t tell us” this fact is “complete nonsense,” he said.

“Most mortgages are securitized and not held by the bank. The person who took out the loan has no interest or concern whether you pay it off 15 years early,” Redmond explains.

Plus, when homeowners make additional payments on their mortgage principal, “you’re essentially putting money into a savings account with mortgage interest, so you need to be happy with that yield,” he explains.

He points out that if homeowners aren’t happy with their interest rates, they may be better off using the extra cash in another, more profitable investment.

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