Loading summary

Transcript11 lines

[00:01]
Accenture/Spotify Advertiser
This episode is brought to you by Accenture. When your advertising operations fall out of sync, everything else follows. Spotify and Accenture are working together to reinvent the rhythm of ad sales, using automation, analytics and smarter workflows to simplify campaign delivery and access better data across the business. The result? Less time spent on operations, more time connecting brands with the moments and fandoms that matter most. Learn more@accenture.com Spotify right now get up
[00:31]
Home Depot Advertiser
to 15% off select storage solutions put heavy duty HDX totes to good use, protecting what's important to you. The solid impact resistant design prevents cracking and the clear base and sides make items easy to find even when the totes are stacked. Find Select Shelving and Tote storage up to 15% off at the Home Depot. To organize every room in your home, from your garage to your attic, visit homedepot.com how doers get More Done the
[01:00]
Paul Mark Morris
Federal Reserve didn't blink should you? The Federal Reserve met this past Wednesday and there was no cut. In fact, three officials voted to raise rates and mortgage rates hit a one year high anyway and that was 6.66% according to Freddie Mac. If your 2026 plan starts with when the rates come down, this episode is your intervention. Welcome to the State of the Market. I am Paul Mark Morris. This is the Paul Mark Morris Podcast. I am a brokerage owner, investor and attorney. Today, the three numbers that matter what the Fed actually said, my view on where an investor finds certainty when the Fed provides none and three decisions for your next 90 days. One quick note before we start. I'm an investor and an attorney, but I'm not acting as your investment advisor or attorney here. This podcast is my personal market analysis, not legal, tax, financial or investment advice. The full disclaimer will be at the end of the podcast. So let's get into it. Segment one the numbers you can't afford to miss in under two minutes. The first number is 6.66%. That is the 30 year fixed rate according to Freddie Mac. And this is the fourth weekly increase in a row and the highest it's been in a year. The second number is 923 and that was the Fed's vote on Wednesday to hold the rate where it is. And the three who actually broke ranks voted to raise the rates, not cut them. The third number is $440,600 and that is the median price of a home sold in June according to the national association of Realtors. And that is an all time record. While pending sales fell 5.4% and when I say pending sale, I'm talking about the houses that are under contract. So contract fully executed by but haven't closed yet. So the number of houses under contract that went under contract fell 5.4%. So we've got a high number in terms of the sale price and less homes going under contract at the same time. Those three numbers tell the whole story. Money got more expensive, prices are holding and buyers are hesitating. That is the standoff that I talked about in last week's State of the Market. And everything else today for the state of the market hangs on those three numbers. So here's what we were waiting for. The Federal Reserve Board met and here's what they said. They held their interest rate at 3.5 to 3.75% and the vote was 9 to 3. The 9 were 9 voting to hold the rate and 3 dissenters were actually all wanting a quarter point hike. A year ago the whole debate was whether the cuts were coming. Now the argument inside the building is whether to raise rates. Chairman Kevin Warsh said three things that are worth talking about. And he called this quote watchful thinking, not watchful waiting. He said that five plus years of high inflation, and this was his quote, cannot be cured in nine weeks. And he said the Fed will not hesitate to act. Will the Fed raise rates in September? The honest answer is they won't say. And this Fed has stopped making promises about its next move. But the market votes every single day. And the futures market currently puts it at roughly a 7 in 10 odds on a quarter point hike by September. Not a cut, a hike. And my read is simple on this. The rescue is not coming. Plan on today's numbers. If something better ends up showing up, that is a bonus. The next Federal reserve decision comes September 16th. The next inflation report comes August 12th. Those are two dates you should put in your calendar because this they will decide the market you're operating in this fall. Segment two, the ongoing war, oil prices and your mortgage rate. One minute on the war again because it absolutely impacts your interest rate. After a week of missile strikes and a Saudi led push to protect shipping, Brent crude, remember that's the international index, is around 8, $88. Somewhere between 88 and $90 per barrel. That's up more than 20% for July. And here's the simple thread to follow. This is how the war ties to the interest rates.
[06:08]
Accenture/Spotify Advertiser
This episode is brought to you by Accenture. When your advertising operations fall out of sync, everything else follows. Spotify and Accenture are working together to Reinvent the rhythm of ad sales using automation, analytics and smarter workflows to simplify campaign delivery and access better data across the business. The result? Less time spent on operations, more time connecting brands with the moments and fandoms that matter most. Learn more@accenture.com Spotify War keeps the price
[06:39]
Paul Mark Morris
of oil volatile Volatile oil prices feed the risk of higher inflation and and inflation risk pushes the rate of the bonds higher. Higher bond rates equal higher mortgage rates. So that's how the war ties directly to your interest rates. And the bottom line is until the Strait of Hormuz is genuinely settled, that risk premium, the premium of this uncertainty, will live inside every rate you're quoted. That's the whole story. So let's move on. Segment 3 I want to give you my view, and that is when the Fed creates uncertainty, you can create certainty by negotiating a better deal. Stop trying to predict what the Fed is going to do. You can't control interest rates, but you can control the deal you're making. You can negotiate seller financing, perhaps. Definitely look into it. You can get a rate buy down. Again, these are possibilities. These are things you can ask for and always check to see if you can assume the seller's loan. In most cases, I find that you cannot do that, but it's definitely worth looking at for sure. And some people actually will go out and hunt for deals that have an assumable rate because you might be able to get a rate much lower than the current rates now, and that adds a tremendous amount of value. Additionally, you can negotiate more time for the closing if that's something that's going to help you. And a lot of times in an investment deal that will help you. If you're planning on making renovations or changes to the building or structure, you can build those into a longer timeline and you can do that before the property closes. These things definitely matter and they change how good or bad a deal is. Right now, sellers are more often willing to negotiate terms than they are to cut price. That's my experience, and I think the market is showing that. And the investors who win aren't necessarily the ones that are getting the best price, but the ones that are getting the best deal in a negotiation. They are also certainly not the ones that are predicting the future. They are the ones that are able to negotiate right here, right now, when the market has stalled a bit. Segment 4 let's talk about what some of the quote experts are saying. And again, I, I refer to this one because it really went viral and that is Robert Kiyosaki I've met him in person. Super interesting guy. He's the author of Rich Dad, Poor dad. And this last week he again said the global economy, this is a quote, is crashing and the US is bankrupt. Millions of people saw that. I watched them, I watched their reactions to it. And so I want to do a reality check against that quote and I'm going to do that with this week's numbers. The economy actually grew one and a half percent last quarter. Consumer spending sped up and right now this is an absolute key point. Fewer than 2% of homeowners owe more than the house is worth. Something we call, you know, being underwater when you owe more than the house is worth. But according to CoreLogic, less than 2% of homes in the United States are underwater. And contrast that with a financial crisis when the bottom really fell out of this market in and that was a massive 26%. That's a huge difference. And it is the difference between a market under pressure, which I think is our market right now, and a market in collapse. Do these numbers mean that we're out of the woods? Definitely not. We have serious issues. The federal government has huge debt. That's what Kiyosaki is referring to with, you know, the government is bankrupt. So there's, there's some facts behind that. Inflation is still running well above the Fed's target, nearly double. I think that, I think the last number I saw was 3.7% and the Fed targets 2%. So, so a fair amount higher inflation rate than, than the Fed would like to see and that is normal. So these risks are real and they deserve to be taken seriously. But they are not in my opinion, pointing to a real estate or total market crash. I rely on the data, not the headlines. And if you do that too, you will distinguish yourself. Segment five, your next 90 days. Three decisions to really look at with your own experts and your own market. Decision one is rerun every number at a bare minimum with the current interest rate and that is 6.66%. And I prefer to stress test deals a little higher. So do your current deals, the ones that you currently own or ones that you're looking at buying, do they work at 7%? That gives you a really little piece of cushion to help you out. If they can stress test a little higher than the current rates, then you know you can enter a deal with some safety. If these deals don't work at today's rate, don't talk yourself into it. Decision two, know the loan documents before you start arguing about the price I know there's a mountain of fine print, but there are three things you should know cold on any deal you own right now, or any deal you're looking at. Number one is the loan assumable. Some mortgages let a buyer step into the seller's existing loan and keep the seller's old rate. A seller sitting at 3 or 3.5% is holding something a buyer wants more than a discount. Most conventional loans don't allow for it, which I rarely see it on normal loans and normal deals, but government loans often do. And it's important enough it changes the deal so much that you should definitely ask for it every time and possibly even look for it in new deals. Another point absolutely key, and that is if you've got an adjustable rate, how high can it go? There's usually a ceiling written into the loan and you've got to find that number because that number is your worst case scenario. And, and it's what the deal has to be able to survive. Not today's rate, but the ceiling of that floating loan. And so this is the mistake that many people made when they bought, when they underwrote deals and then they bought them at a 3% rate or a 3 and a half percent rate that was adjustable. And now they are literally looking down the barrel of a shotgun when rates reset. Many deals cannot survive this reset. So buying now only if the deal can survive the upper limit of a floating rate or buy into something that doesn't float for a long time. You know, adjustable rates are sometimes five years, seven years, sometimes they're 15. And I certainly have bought deals with a 30 year fixed. So that takes that off the table and creates certainty. The upper limit of an adjustable rate is something you've got to consider before you get into a deal. The third thing is what happens when the loan comes due. Short term loans have a finish line and most of them have an option to push the total payback date out. But you've got to understand, is it an option that the borrower has or is it something that requires the lender's approval? Because if it's an option that's baked in that the buyer has, you have real choice. If the lender has the choice, then you're really asking for a favor when the loan comes due. That's not a position you want to be in. Decision three, get your calendars out. Circle August 12th, that is when the inflation report comes out, very significant and important. And also September 16th, that is the next time the Fed meets and decides whether they're going to adjust rates or not, you need to know these two numbers to know the playing field that you're playing on. And those two dates are really going to help you as we move into the fall. Here's a quick disclaimer. Nothing in this episode is financial, legal, tax or investment advice. I'm sharing my personal opinions and analysis. As of today, they are not recommendations to be relied upon. Markets change. And as I always say, markets are local. Every deal is different. Before you make any investment, consult your own professionals, your cpa, your attorney, your financial advisor, a great realtor, and do your own due diligence. That's the state of the market. Subscribe, Send me your market and your questions. The best ones get answered on air. I am Paul Mark Morris and I'll see you next week.
[16:16]
Blinds.com Advertiser
The Right Window treatments change everything. Your sleep, your privacy, the way every room looks and feels. @blinds.com, we've spent 30 years making it surprisingly simple to get exactly what your home needs. We've covered over 25 million windows and have 50,000 five star reviews to prove we deliver. Whether you DIY it or want a pro to handle everything from measure to install, we have you covered. Real design professionals, free samples, zero pressure right now. Get up to 50% off with minimum purchase plus get a free professional measure. @blinds.com rules and restrictions apply.
[16:48]
Paul Mark Morris
I'm not giving up. I am selling the building. The final season of FX Is the Bear. The restaurant is flooded.
[16:59]
Home Depot Advertiser
Everything's either going to be okay.
[17:01]
Paul Mark Morris
No, stop.
[17:02]
Home Depot Advertiser
Or not.
[17:04]
Paul Mark Morris
We are outgunned and we are outmanned. But we have each other. FX Is the Bear the final season. All episodes now streaming on Disney plus.

Summary5 min read

Podcast Summary: The Paul Morris Podcast

Episode: You Can Secure Your Future—Here's How to Navigate the Fed's Uncertainty!

Host: Paul Mark Morris
Date: August 3, 2026

Episode Overview

In this episode of The Paul Morris Podcast, Paul Mark Morris delivers a direct, data-driven analysis of the current U.S. real estate and financial markets amid ongoing Federal Reserve uncertainty. Paul focuses on actionable strategies for investors to navigate today’s elevated interest rates, unpredictable policy decisions, and persistent inflation pressures. He breaks down the three numbers that define the current market stand-off, draws connections between global events and real estate finance, challenges doomsday narratives, and gives precise guidance for investors on decision-making over the next 90 days.

Main Theme:
“Stop guessing what the Fed will do—focus on what you can control. You can secure your financial future, even when the Fed won’t make promises.”

Key Discussion Points & Insights

1. Three Numbers Defining the Market

[01:00 - 03:40]

30-Year Fixed Mortgage Rate:
- 6.66%, highest in a year (per Freddie Mac).
- “Fourth weekly increase in a row and the highest it’s been in a year.” (Paul Mark Morris, 01:36)
Federal Reserve Decision:
- Fed held rates at 3.5–3.75% (vote: 9 to hold, 3 to raise rates).
- “A year ago, the whole debate was whether the cuts were coming. Now the argument… is whether to raise rates.” (02:35)
Median Home Price:
- $440,600 (June, per NAR)—an all-time record.
- Pending sales fell 5.4%.
- “Money got more expensive, prices are holding, and buyers are hesitating. That is the standoff.” (03:15)

Summary of Impact:
These numbers signal a tight, cautious market: lending is expensive, prices are resilient, and buyer demand is softening.

2. Fed Signals and Market Sentiment

[03:45 - 06:05]

Fed Chairman Kevin Warsh’s Message:
- “Five-plus years of high inflation… cannot be cured in nine weeks.” (04:20)
- “This is ‘watchful thinking,’ not watchful waiting.” (04:12)
- The Fed refuses to forecast its next move; instead, market futures imply a 70% chance of a rate hike, not a cut, by September.
Investor Takeaway:
- “The rescue is not coming. Plan on today’s numbers. If something better ends up showing up, that is a bonus.” (05:08)

Key Dates to Track:

August 12: Next inflation report
September 16: Next Fed meeting

3. Global Events & Rate Impact: The War and Oil Prices

[06:39 - 07:59]

Ongoing Middle East conflict keeps Brent crude oil volatile—up 20% in July (now around $88–90/barrel).
“War keeps the price of oil volatile… Volatile oil prices feed the risk of higher inflation… higher bond rates equal higher mortgage rates.” (06:41)
Until the Strait of Hormuz is settled, a “risk premium” will be baked into every interest rate.

4. Creating Certainty in Uncertain Times

[08:00 - 09:35]

Focus on what can be controlled: negotiate better deals rather than wait for macro changes.
Practical strategies:
- Ask for seller financing
- Seek a rate buy-down
- Assume the seller's loan if possible
- Negotiate more time for closing, especially when renovations or complex transitions are needed
“Sellers are more often willing to negotiate terms than they are to cut price. The investors who win… are getting the best deal in a negotiation, not predicting the future.” (09:25)

5. Expert Opinions vs. Market Reality

[09:36 - 11:50]

Robert Kiyosaki’s viral comments:
- “The global economy is crashing and the US is bankrupt.”
Paul’s reality check:
- The U.S. economy grew 1.5% last quarter.
- Less than 2% of homeowners owe more than their home is worth (vs. 26% during the financial crisis).
- Key distinction: A market “under pressure,” not “in collapse.”
“I rely on the data, not the headlines. And if you do that too, you will distinguish yourself.” (11:40)

6. Your Next 90 Days: Three Essential Decisions

[11:50 - 16:05]

Decision 1: Rerun Every Number

Analyze deals with current (6.66%) and higher (7%) rates—build in a cushion.
“If these deals don’t work at today’s rate, don’t talk yourself into it.” (12:33)

Decision 2: Know Your Loan Documents

Three critical questions:
1. Is the loan assumable?
  - Government loans sometimes allow this; most conventional loans do not.
  - “A seller sitting at 3%… is holding something a buyer wants more than a discount.” (13:39)
2. How high can your adjustable-rate loan go?
  - Know your worst-case scenario.
  - “Buying now only if the deal can survive the upper limit of a floating rate or buy into something that doesn’t float for a long time.” (14:24)
3. What happens when the loan comes due?
  - Is an extension option guaranteed, or does it depend on lender approval?
  - “If the lender has the choice, then you’re really asking for a favor… that’s not a position you want to be in.” (15:09)

Decision 3: Mark Key Dates

August 12: Inflation report
September 16: Next Fed meeting
“You need to know these two numbers to know the playing field that you’re playing on.” (15:39)

Notable Quotes & Memorable Moments

“If your 2026 plan starts with ‘when the rates come down,’ this episode is your intervention.” (01:04)
“Stop trying to predict what the Fed is going to do. You can’t control interest rates, but you can control the deal you’re making.” (08:03)
“The investors who win aren’t the ones who predict the future. They are the ones that are able to negotiate right here, right now, when the market has stalled a bit.” (09:19)
“We have serious issues… inflation is still running well above the Fed’s target, nearly double. But these risks are real and they deserve to be taken seriously. They are not, in my opinion, pointing to a real estate or total market crash.” (11:20)
“I’m sharing my personal opinions and analysis… They are not recommendations to be relied upon.” (16:05)

Useful Timestamps by Segment

Numbers to Know / Fed’s Moves: 01:00–06:00
War & Oil / Rate Connection: 06:39–07:59
Negotiation Strategies: 08:00–09:35
Expert Commentary Reality Check: 09:36–11:50
Next 90 Days—Tactical Decisions: 11:50–16:05

Closing Remarks

Paul Mark Morris asserts that in a time of heightened uncertainty, mastery comes from clear-eyed assessment of current realities and control over the details you can negotiate. Rate cuts may not save you—savvy deal making and meticulous loan analysis will.

Action Step: Rerun your numbers, scrutinize your loans, and keep your calendar marked for the next big data releases. The decisive edge lies not in prediction, but in rigorous, proactive management.

Subscribe, send questions, and stay sharp for next week’s State of the Market.

Loading summary

Transcript11 lines

[00:01]
Accenture/Spotify Advertiser
This episode is brought to you by Accenture. When your advertising operations fall out of sync, everything else follows. Spotify and Accenture are working together to reinvent the rhythm of ad sales, using automation, analytics and smarter workflows to simplify campaign delivery and access better data across the business. The result? Less time spent on operations, more time connecting brands with the moments and fandoms that matter most. Learn more@accenture.com Spotify right now get up
[00:31]
Home Depot Advertiser
to 15% off select storage solutions put heavy duty HDX totes to good use, protecting what's important to you. The solid impact resistant design prevents cracking and the clear base and sides make items easy to find even when the totes are stacked. Find Select Shelving and Tote storage up to 15% off at the Home Depot. To organize every room in your home, from your garage to your attic, visit homedepot.com how doers get More Done the
[01:00]
Paul Mark Morris
Federal Reserve didn't blink should you? The Federal Reserve met this past Wednesday and there was no cut. In fact, three officials voted to raise rates and mortgage rates hit a one year high anyway and that was 6.66% according to Freddie Mac. If your 2026 plan starts with when the rates come down, this episode is your intervention. Welcome to the State of the Market. I am Paul Mark Morris. This is the Paul Mark Morris Podcast. I am a brokerage owner, investor and attorney. Today, the three numbers that matter what the Fed actually said, my view on where an investor finds certainty when the Fed provides none and three decisions for your next 90 days. One quick note before we start. I'm an investor and an attorney, but I'm not acting as your investment advisor or attorney here. This podcast is my personal market analysis, not legal, tax, financial or investment advice. The full disclaimer will be at the end of the podcast. So let's get into it. Segment one the numbers you can't afford to miss in under two minutes. The first number is 6.66%. That is the 30 year fixed rate according to Freddie Mac. And this is the fourth weekly increase in a row and the highest it's been in a year. The second number is 923 and that was the Fed's vote on Wednesday to hold the rate where it is. And the three who actually broke ranks voted to raise the rates, not cut them. The third number is $440,600 and that is the median price of a home sold in June according to the national association of Realtors. And that is an all time record. While pending sales fell 5.4% and when I say pending sale, I'm talking about the houses that are under contract. So contract fully executed by but haven't closed yet. So the number of houses under contract that went under contract fell 5.4%. So we've got a high number in terms of the sale price and less homes going under contract at the same time. Those three numbers tell the whole story. Money got more expensive, prices are holding and buyers are hesitating. That is the standoff that I talked about in last week's State of the Market. And everything else today for the state of the market hangs on those three numbers. So here's what we were waiting for. The Federal Reserve Board met and here's what they said. They held their interest rate at 3.5 to 3.75% and the vote was 9 to 3. The 9 were 9 voting to hold the rate and 3 dissenters were actually all wanting a quarter point hike. A year ago the whole debate was whether the cuts were coming. Now the argument inside the building is whether to raise rates. Chairman Kevin Warsh said three things that are worth talking about. And he called this quote watchful thinking, not watchful waiting. He said that five plus years of high inflation, and this was his quote, cannot be cured in nine weeks. And he said the Fed will not hesitate to act. Will the Fed raise rates in September? The honest answer is they won't say. And this Fed has stopped making promises about its next move. But the market votes every single day. And the futures market currently puts it at roughly a 7 in 10 odds on a quarter point hike by September. Not a cut, a hike. And my read is simple on this. The rescue is not coming. Plan on today's numbers. If something better ends up showing up, that is a bonus. The next Federal reserve decision comes September 16th. The next inflation report comes August 12th. Those are two dates you should put in your calendar because this they will decide the market you're operating in this fall. Segment two, the ongoing war, oil prices and your mortgage rate. One minute on the war again because it absolutely impacts your interest rate. After a week of missile strikes and a Saudi led push to protect shipping, Brent crude, remember that's the international index, is around 8, $88. Somewhere between 88 and $90 per barrel. That's up more than 20% for July. And here's the simple thread to follow. This is how the war ties to the interest rates.
[06:08]
Accenture/Spotify Advertiser
This episode is brought to you by Accenture. When your advertising operations fall out of sync, everything else follows. Spotify and Accenture are working together to Reinvent the rhythm of ad sales using automation, analytics and smarter workflows to simplify campaign delivery and access better data across the business. The result? Less time spent on operations, more time connecting brands with the moments and fandoms that matter most. Learn more@accenture.com Spotify War keeps the price
[06:39]
Paul Mark Morris
of oil volatile Volatile oil prices feed the risk of higher inflation and and inflation risk pushes the rate of the bonds higher. Higher bond rates equal higher mortgage rates. So that's how the war ties directly to your interest rates. And the bottom line is until the Strait of Hormuz is genuinely settled, that risk premium, the premium of this uncertainty, will live inside every rate you're quoted. That's the whole story. So let's move on. Segment 3 I want to give you my view, and that is when the Fed creates uncertainty, you can create certainty by negotiating a better deal. Stop trying to predict what the Fed is going to do. You can't control interest rates, but you can control the deal you're making. You can negotiate seller financing, perhaps. Definitely look into it. You can get a rate buy down. Again, these are possibilities. These are things you can ask for and always check to see if you can assume the seller's loan. In most cases, I find that you cannot do that, but it's definitely worth looking at for sure. And some people actually will go out and hunt for deals that have an assumable rate because you might be able to get a rate much lower than the current rates now, and that adds a tremendous amount of value. Additionally, you can negotiate more time for the closing if that's something that's going to help you. And a lot of times in an investment deal that will help you. If you're planning on making renovations or changes to the building or structure, you can build those into a longer timeline and you can do that before the property closes. These things definitely matter and they change how good or bad a deal is. Right now, sellers are more often willing to negotiate terms than they are to cut price. That's my experience, and I think the market is showing that. And the investors who win aren't necessarily the ones that are getting the best price, but the ones that are getting the best deal in a negotiation. They are also certainly not the ones that are predicting the future. They are the ones that are able to negotiate right here, right now, when the market has stalled a bit. Segment 4 let's talk about what some of the quote experts are saying. And again, I, I refer to this one because it really went viral and that is Robert Kiyosaki I've met him in person. Super interesting guy. He's the author of Rich Dad, Poor dad. And this last week he again said the global economy, this is a quote, is crashing and the US is bankrupt. Millions of people saw that. I watched them, I watched their reactions to it. And so I want to do a reality check against that quote and I'm going to do that with this week's numbers. The economy actually grew one and a half percent last quarter. Consumer spending sped up and right now this is an absolute key point. Fewer than 2% of homeowners owe more than the house is worth. Something we call, you know, being underwater when you owe more than the house is worth. But according to CoreLogic, less than 2% of homes in the United States are underwater. And contrast that with a financial crisis when the bottom really fell out of this market in and that was a massive 26%. That's a huge difference. And it is the difference between a market under pressure, which I think is our market right now, and a market in collapse. Do these numbers mean that we're out of the woods? Definitely not. We have serious issues. The federal government has huge debt. That's what Kiyosaki is referring to with, you know, the government is bankrupt. So there's, there's some facts behind that. Inflation is still running well above the Fed's target, nearly double. I think that, I think the last number I saw was 3.7% and the Fed targets 2%. So, so a fair amount higher inflation rate than, than the Fed would like to see and that is normal. So these risks are real and they deserve to be taken seriously. But they are not in my opinion, pointing to a real estate or total market crash. I rely on the data, not the headlines. And if you do that too, you will distinguish yourself. Segment five, your next 90 days. Three decisions to really look at with your own experts and your own market. Decision one is rerun every number at a bare minimum with the current interest rate and that is 6.66%. And I prefer to stress test deals a little higher. So do your current deals, the ones that you currently own or ones that you're looking at buying, do they work at 7%? That gives you a really little piece of cushion to help you out. If they can stress test a little higher than the current rates, then you know you can enter a deal with some safety. If these deals don't work at today's rate, don't talk yourself into it. Decision two, know the loan documents before you start arguing about the price I know there's a mountain of fine print, but there are three things you should know cold on any deal you own right now, or any deal you're looking at. Number one is the loan assumable. Some mortgages let a buyer step into the seller's existing loan and keep the seller's old rate. A seller sitting at 3 or 3.5% is holding something a buyer wants more than a discount. Most conventional loans don't allow for it, which I rarely see it on normal loans and normal deals, but government loans often do. And it's important enough it changes the deal so much that you should definitely ask for it every time and possibly even look for it in new deals. Another point absolutely key, and that is if you've got an adjustable rate, how high can it go? There's usually a ceiling written into the loan and you've got to find that number because that number is your worst case scenario. And, and it's what the deal has to be able to survive. Not today's rate, but the ceiling of that floating loan. And so this is the mistake that many people made when they bought, when they underwrote deals and then they bought them at a 3% rate or a 3 and a half percent rate that was adjustable. And now they are literally looking down the barrel of a shotgun when rates reset. Many deals cannot survive this reset. So buying now only if the deal can survive the upper limit of a floating rate or buy into something that doesn't float for a long time. You know, adjustable rates are sometimes five years, seven years, sometimes they're 15. And I certainly have bought deals with a 30 year fixed. So that takes that off the table and creates certainty. The upper limit of an adjustable rate is something you've got to consider before you get into a deal. The third thing is what happens when the loan comes due. Short term loans have a finish line and most of them have an option to push the total payback date out. But you've got to understand, is it an option that the borrower has or is it something that requires the lender's approval? Because if it's an option that's baked in that the buyer has, you have real choice. If the lender has the choice, then you're really asking for a favor when the loan comes due. That's not a position you want to be in. Decision three, get your calendars out. Circle August 12th, that is when the inflation report comes out, very significant and important. And also September 16th, that is the next time the Fed meets and decides whether they're going to adjust rates or not, you need to know these two numbers to know the playing field that you're playing on. And those two dates are really going to help you as we move into the fall. Here's a quick disclaimer. Nothing in this episode is financial, legal, tax or investment advice. I'm sharing my personal opinions and analysis. As of today, they are not recommendations to be relied upon. Markets change. And as I always say, markets are local. Every deal is different. Before you make any investment, consult your own professionals, your cpa, your attorney, your financial advisor, a great realtor, and do your own due diligence. That's the state of the market. Subscribe, Send me your market and your questions. The best ones get answered on air. I am Paul Mark Morris and I'll see you next week.
[16:16]
Blinds.com Advertiser
The Right Window treatments change everything. Your sleep, your privacy, the way every room looks and feels. @blinds.com, we've spent 30 years making it surprisingly simple to get exactly what your home needs. We've covered over 25 million windows and have 50,000 five star reviews to prove we deliver. Whether you DIY it or want a pro to handle everything from measure to install, we have you covered. Real design professionals, free samples, zero pressure right now. Get up to 50% off with minimum purchase plus get a free professional measure. @blinds.com rules and restrictions apply.
[16:48]
Paul Mark Morris
I'm not giving up. I am selling the building. The final season of FX Is the Bear. The restaurant is flooded.
[16:59]
Home Depot Advertiser
Everything's either going to be okay.
[17:01]
Paul Mark Morris
No, stop.
[17:02]
Home Depot Advertiser
Or not.
[17:04]
Paul Mark Morris
We are outgunned and we are outmanned. But we have each other. FX Is the Bear the final season. All episodes now streaming on Disney plus.