Homeownership - The Journey

Introduction

Danielle 00:00
Hi and welcome to the A+ You podcast, where we chat with our internal experts and community members about how finances affect us in the real world. Translating complex subjects into lively discussions brought to you by Affinity Plus Federal Credit Union. I'm your host, Danielle Johnson.

Amber 00:16
And I'm your co host, Amber Shanley.

Danielle 00:19
Well, if this podcast were all on video, you would see that we're missing a plant. Why is that Amber?

Amber 00:30
Well, there was one there and now it's not.

Danielle 00:33
because it's no longer with us.

Amber 00:36
This is why we buy fake plants Danielle

Danielle 00:40
We had a communication issue when it came to watering our plant.

Amber 00:45
I didn't know it was real.

Danielle 00:48
Now, if you can just envision us sitting on a couch with a coffee table, there are two cups and no plant. So...

Amber 00:56
It was a pretty orchid, thus I thought it was fake.

Danielle 01:02
Yeah, well, fake plants, I agree.

Amber 01:07
See they last longer.

Danielle 01:11
Well, I'm super excited because on today's episode, we're talking about home ownership. We're talking about the good the bad, and hopefully we answer any questions that anybody that is listening have, because home ownership can be really intimidating,

Amber 01:26
Well, and not only home ownership, but like, what about when you already own a home?

Danielle 01:29
Like, yeah, when your basement floods,

Amber 01:34
Or, you know, a hail storm comes?

Danielle 01:37
Like, a lot of things can happen.

Amber 01:39
But also, what about like the memories made in a new home and in a- either your current home or new home, whatever it may be, I think that's really what inspires me; is hearing those stories from our members and once they are into their home, whether it's from us or doing home repairs or improvements through us as well. So, lots of different ways to do many of those things.

Danielle 02:04
Well, home ownership can be complicated, and let's try and simplify it a little bit I think.

Amber 02:08
Absolutely, and I think that's why we have our guest here today.

Meet our guest: Tara Rutz, mortgage servicing and origination manager

Danielle 02:11
Today we're joined by Tara Rutz. Tara, you are the mortgage servicing and origination manager. I'm gonna be honest. I don't know what that means, so why don't you tell me and everyone listening what you do here at Affinity Plus.

Tara Rutz 02:24
Yes, well, thank you for having me here today. I'm excited to chat with both of you on this podcast, but so basically servicing an origination manager, I do a little bit of both helping the mortgage loan officers with originating loans. So we help members as they're buying homes, doing their home improvement projects, doing the things to the home that they want to do. But then I also lead the servicing team. So once you own a home and you have your first mortgage with Affinity Plus, we have a team that handles like when you have a homeowner's insurance claim-

Amber 02:55
Or property tax

Tara Rutz 02:56
-Property taxes, yeah, paying that.

Danielle 02:59
So it doesn't all just stop once you buy the home. There's a whole team that helps you, like, supports you through owning your home.

Tara Rutz 03:07
Yeah, yeah, absolutely. Like, your property taxes have to be paid, so if you have an escrow account, you know we're going to pay the taxes for you. When you do have a homeowner's insurance claim, typically a lender is listed on your homeowners insurance, and then we have to, like, monitor the claim, make sure that the home comes back to its original state, that sort of thing. Just making sure that, yeah, you get the home back to where it was prior to something happening.

Amber 03:30
Yeah, and any repairs. Like, you don't want to live in a damaged home.

Tara Rutz 03:34
Right. Absolutely.

Amber 03:35
Yeah

What is a down payment and an appraisal?

Danielle 03:35
Interesting. Okay, well, Tara, I think that's a good transition. So you mentioned the word escrow, and I think there's a lot of jargon that gets thrown around with home ownership, so maybe walk us through some of the jargon that we might hear when you're a first time home buyer and you've never done this before, and like, what does some of that stuff mean?

Tara Rutz 03:53
Yeah, absolutely. So I mean right away off the bat, down payment. I think that's a big one. Everybody thinks you have to have 20% down when you buy a home, you don't have to have 20% down. If you're a first time home buyer, you can have as little as 3% down. There can be programs out there that allow you to put less down, but it will depend on the program. For example, like VA, that would be another one that you could potentially put as little as no down, no money down. But I think that's the one of the bigger ones is that down payment.

Appraisal. I think that's another one that can be confused with like a home inspection. So an appraisal is usually done and ordered by the lender. Once you find a home, so you get a you sign a purchase agreement with a home you want to buy. You're excited, but you obviously want to make sure that the home is in the condition you're expecting, and so a home inspection is usually done to make sure that it is what you're expecting. An appraisal, on the other hand, is ordered by the lender to make sure the value is there and that it meets the lenders guidelines. So they're two different pieces of information.

Amber 04:58
Can you go. To a little bit of like, what- what does an appraisal look at? How do they know the value?

Tara Rutz 05:04
Yeah, so an appraisal is an opinion of value. And so they're going to look at, like, your square footage in the house, how many bedrooms, how many bathrooms, what size property, when was it built. And then they're gonna find homes of similar style and compare it so, like, in your neighbor, in your neighborhood, yeah, they have to be within a certain distance, so it's also within a certain time frame.

Danielle 05:26
Okay, okay, so there's a lot of factors that go into an appraisal.

Tara Rutz 05:30
Yeah, absolutely. Yep.

Danielle 05:32
Okay

What is Escrow?

Amber 05:32
What is an escrow? What is escrow? 

Danielle 05:35
"I'm in escrow." It's like, there's like a show, and he's like, "I'm in escrow."

Tara Rutz 05:40
So depending on your lender, escrow season can be different. Here at affinity, plus, we do ours in June. So first payments, when they adjust, are typically in August. Basically, when you buy a house, you have the option to what's called escrow your taxes and insurance in your monthly payment. So you have two choices, you escrow and you basically take your taxes and insurance, divide it out over the entire year into your monthly payment, and then we pay your taxes and insurance for you. The other option...

Danielle 06:08
That seems like way less stressful

Tara Rutz 06:10
Yes, it's, it's the most common way to go, is most people do escrow.

Danielle 06:15
But I'm sorry you said there was a second option.

Tara Rutz 06:17
So the second option is you just don't escrow, so then your monthly payment is just your principal interest and mortgage insurance if you have it, and then you pay your taxes and insurance on your own.

Danielle 06:29
So that's something you can either choose to have your lender kind of take care of that for you, or you can choose to schedule those payments out and make them on your own,

Tara Rutz 06:36
Right. Yep

Danielle 06:37
Okay,

Amber 06:38
What do you do, Danielle?

Danielle 06:39
I escrow.

Amber 06:40
I don't.

Danielle 06:41
Wow.

Amber 06:42
I know.

Danielle 06:44
Look at that.

Amber 06:45
I know. I like to label different accounts with what I use the funds for. So in my style, I just have an account labeled "property taxes" and another account labeled "insurance," and then I save for it every month, like I pay myself-

Danielle 07:02
So, like you're paying your mortgage.

Amber 07:03
Like I'm paying my mortgage, but I pay myself. So I kind of, I am the escrow account of my household.

Danielle 07:11
Well, I'm super impressed that you can remember, because so I have a friend who actually paid off her home, and she every season she's like, "I forgot to pay my property taxes again." How I and I'm just thinking to myself, like, if I were not in escrow, would I remember to do that? She goes, "I need the paper statements, because apparently I don't pay attention to the emails."

Amber 07:34
I love paper statements. Especially for property taxes. They make my heart happy. It's the insurance one that's always electronic, and I'm like, did I pay that? Did I do it? I don't remember.

Danielle 07:49
Well, so are there any other kind of like, words or phrases or just anything that you can think of.

What is mortgage insurance?

Amber 07:56
You said mortgage insurance. What's mortgage insurance?

Tara Rutz 07:59
Yeah, mortgage insurance is so when you put less than 20% down on the home, or, I should say, it allows you to put less than 20% down on your home. So when you have less than 20% down, then mortgage insurance is added to your monthly payment. And it's a monthly premium. Can be minimal in many cases. So it's going to depend on your credit, how much you're putting down, that sort of thing. But it helps a lot of people be able to get into a home without having to wait to save that entire 20%.

Danielle 08:24
That was- we did that for our first home. We put, I think, we put 3% down, and we had mortgage insurance, but yeah, it definitely- we wouldn't have been able to purchase our first home if it weren't for that. It is incredibly helpful.

Tara Rutz 08:40
Yep.

Amber 08:41
Big benefit to some, some individuals that would like to purchase a home that maybe don't have those funds saved up for 20% down, or, like you said, want to maybe not put 20% down and elect to maybe use those funds for another purpose.

Tara Rutz 08:56
Right. Yeah. And with the cost of home ownership nowadays, I mean, saving 20% can be a substantial amount of money, so it puts people into homes a lot sooner than having to save that entire 20%. And then the nice thing is, depending on your lender, once you hit 20% equity, you can potentially have that mortgage insurance removed without having to refinance.

Amber 09:16
Equity from when you purchase

Tara Rutz 09:18
From when you purchased it, yep.

How do I start the journey to buying a home? How do I know if I'm ready?

Danielle 09:19
Wow. Tara, as we're kind of talking through some of these jargon words, if I am an individual listening, and I maybe rent or I live at home, like, what kind of advice would you say to someone that might be thinking about starting that journey to home ownership? Or, how would you, how would they know if they're ready?

Tara Rutz 09:43
Yeah. So basically, to kind of get started, one thing I would always start off with is just kind of finding out, like, where do you want to buy a home if you're thinking about buying it. So that you can get an idea of, like, the cost of a home. What are you looking at? Because every area is a little bit different. So I think starting there, you know, do you have family or friends? Do you have a job you need to be near? Do you have schools you want to be and like, what is kind of driving where you want to land on that first home purchase? But then I always think about that down payment, not just like the down payment itself, but how much is it going to cost you to live there, right? So if your payment is $1,000 a month, and you're expecting a mortgage to be just say, $2,000 or $2,500 a month, like pay yourself that difference so you can kind of see what it feels like to pay that mortgage.

Amber 10:28
That's really good advice.

Danielle 10:30
Yeah, that's still great.

Tara Rutz 10:31
But then can you still continue to do the things you want to do. Because we all have different lifestyles, right? Like some of us want to go to the movies every Friday night.

Amber 10:39
Or Starbucks every morning.

Tara Rutz 10:43
Yep, you want to be able to continue to do the things that you want to do, even though you own a home. And then I think it's also still important to be able to save even after that mortgage payment, because, like we're talking about with homeowners insurance claims or anything like that, there are things that can happen that are outside of natural disasters, that can just happen to the home, and you have to fix those now. So are you prepared?

Amber 11:03
Or maybe you just want your house to be a different color.

Tara Rutz 11:06
Exactly? Yep, or you want to add a bedroom.

Danielle 11:09
yeah, who knew paint was so expensive?

Amber 11:12
Yes, that is a true statement. And if you bought the bright pink house on the street, maybe you don't want it to be bright pink anymore.

Tara Rutz 11:19
Maybe not. Yes.

Amber 11:20
And that's that can be expensive to maybe have someone else paint it if you're not feeling comfortable doing it, depending on the size, things like that. Absolutely.

Tara Rutz 11:28
Yep. I think no matter what, we all just want to make our home our own, which just takes additional money, and so you want to be prepared for that too.

Amber 11:36
Absolutely individualize.

Danielle 11:38
Well, I think that's a really good point for someone who, because I know when we were looking at our first house like we had a newborn and but like you said, schools, neighborhoods, jobs. I mean, there's a lot of different things to think about when you're picking out a neighborhood that you want to live in. And sometimes, oh, don't get me wrong, there's neighborhoods I want to live in, but my budget does not allow that. So those are, I, those are really good, that's a really kind of good list to, like, think about as you're going through that process.

Amber 12:09
So Tara, like, so, like, Danielle was saying, like, there's neighborhoods we want to live in, or maybe we're looking at; what are the next steps? Like, how do I, where do I go from there? Okay, I made the decision, I want to buy a house. What's what's next?

Pre-Approval and how to use mortgage loan officers

Tara Rutz 12:23
Yeah, so once you've kind of found, like- okay, this is how much I want to spend on a house, that's a really good time to kind of start that pre approval process. You're going to want that pre approval in your hand before you start shopping for homes. It just makes it a little easier to be able to put in an offer once you do find a home, instead of waiting for that pre approval when you're ready. So you can start with just talking with, like a mortgage loan officer, getting- having a good conversation about, like, what you want to spend, where do you think your credit is at? Where do you want your monthly payment to be? And do you kind of see that that is all in line. But then once you're ready, then doing an application, and, you know, going through the process having credit checked, having your income reviewed and stuff like that, to make sure that what you're expecting to pay is still something that can be approved and ready for you guys.

Amber 13:09
So a mortgage loan officer would help make that seem more viable, or help guide where, like, a budget could end up being.

Tara Rutz 13:18
Yeah, yep. So a mortgage loan officer is really great resource just to talk about, like, what can you expect that payment to be? There's also great online tools with calculators and stuff like that. So that is always something you could look at prior to talking to a mortgage loan officer just to get an idea of what a monthly payment would look like. But a mortgage loan officer do great in just like, looking at the overall picture. And I think the really good thing about that, too, is just like, the real conversation of, if it isn't within budget, like, where do we need to be, you know, and kind of talking through that a little bit in the why, or, more importantly, if you can't get pre approved at that time, how can we get you there?

Danielle 13:58
Sure, so I come in and I'm, you know, I'm thinking through like, I think I'm ready for this, but once we kind of take a step back and look at every, you know, kind of all the things that you mentioned, maybe, like you said, I'm not quite there. So the next conversation would be, how do I get myself prepared? Is that what you're saying?

Tara Rutz 14:15
Yeah, so sometimes maybe it's that you need to, we need to get a stronger credit score. So maybe something needs to be paid off, you know. Maybe that we need to pay off credit cards. Maybe we just need more credit history, you know. So there can be things that we can just talk through to help get you prepared for when that time comes.

Amber 14:33
I love that. I think that's really where, like, the benefit of sitting down with an Affinity Plus mortgage loan officer, is all of those things Tara just said, but also really ensuring that it's almost like a full credit review when you say, Tara, like that initial pre approval of, here's what's out there. Here's where we want to see you go,

Tara Rutz 14:50
Right, Yeah. I think, I think there's really good value in just having a general conversation about where you do want to go and where you are, even if you're not quite there yet.

Danielle 15:01
So I remember when we were buying our home, you know, we got pre approved, and we were looking at a bunch of houses, but then it was like, 'Okay, now what?' so kind of walk everyone through, you know, once you've been pre approved, and now you're actually looking at homes, like, kind of where you go from there.

What happens after pre-approval?

Tara Rutz 15:20
Yeah, so like, once you're pre approved, then you're more or less like working with a realtor directly. So some will choose to find their own realtor to help them shop for homes. Some might just go to the realtor. That's like selling a house per se. So that can vary just based on your preference, but really it's just shopping for homes. Where do you looking in the communities, you know, looking at the different things you want in your home. Do you want three bedrooms? Do you want four bedrooms, all that kind of stuff, and then, once you find a home, then you work with a realtor to do a purchase agreement and work through like the sales price. When do you want to close? How much do you want to put down? Do you need anything to be done to the home before you close? That sort of stuff. And then I, I always say, like, then it kind of turns over to the lender from there, once you found the house, and like, now you just get to do the fun part of, like, getting ready to move.

Danielle 16:12
So it's really a team effort, is what you're saying. Like, there's a lot of moving parts and a lot of people involved, but everyone's working together.

Tara Rutz 16:19
Yeah, there's a lot that happens behind the scenes once you find the house. You know, you have a title company that will help conduct the closing, do title search. You have the lender that's working through all of the financing part of it. You have the Realtor that will just help if you choose to get a home inspection or navigate get getting the appraisal scheduled, and then you as the buyer, having to do some things as well as, like, finding homeowners insurance, providing documents and such. Generally, it takes about 30 days from this, like, from your purchase agreement to a closing as at a minimum, some people will choose to go longer, but-

Danielle 16:54
And that's just because of all, like, the kind of work you just said, all the behind the scenes stuff that kind of has to happen and process in order for you to actually, like, have the keys.

Tara Rutz 17:02
Yep, exactly.

Danielle 17:03
Okay, gotcha. So 30 days is the typical time frame.

Tara Rutz 17:06
Generally a minimum, yeah.

How does closing on a home work?

Danielle 17:08
Okay, okay. And you said you mentioned closing. So, I mean, just like I said, kind of reliving our, my own home buying experience. I remember they were like, okay, it was our first time. And they're like, Well, you need to bring a check for closing for like, $7,000 and I was like, 'Excuse me, no, what?' So maybe so not everyone else is as shocked as I was once upon a time. Can you kind of walk through what like a closing would look like.

Tara Rutz 17:41
Yeah, so the title company is where you would go to for the closing, and so at the closing, basically everything that you have agreed upon up until that time is brought into one document, what's called the Closing Disclosure. And it'll summarize like, all your charges and all your credits. So you will have, like, your purchase price on there, but then you also said, like, maybe you wanted to put $10,000 down, so that'll be on there. Maybe you did, like, $1,000 earnest money, so that'll be credited on there. And then between the two, you end up with like, a final cash amount that you have to bring to closing.

Amber 18:15
And the earnest money is between you and the realtor, right? The realtor guides you through that, yeah, not your lender.

Tara Rutz 18:21
Yeah. That's typically something that's done when you put the offering on the home, yep. And then you sign all the papers-

Danielle 18:27
like 100

Tara Rutz 18:28
Yep.

Amber 18:30
But, like, that's newer to Affinity Plus, we have some documents that you can sign electronically now.

Tara Rutz 18:35
Yeah, yeah. There's a lot more documents that can be done electronically. And just also, I think the huge benefit there is the transparency. So you know, when you're talking about, like, you were surprised like, to hear $7,000 like, now with the transparency of people getting their documents several days ahead of time, like you have time to, kind of like, read through and review and then go into that closing, like, a lot more prepared and like, ready to sign and and then enjoy buying a home.

Danielle 19:02
So you have an opportunity to ask questions before too, and, like, really understand what you're signing instead of just like, coming in with a pen and buying a home.

Tara Rutz 19:10
Yeah

Amber 19:10
And encourage that though, like, yeah, you would definitely want a buyer to ask their mortgage loan officer questions before the closing.

Tara Rutz 19:18
Yeah, absolutely. Yeah. That's the best time to do it. Like you, your mortgage loan officer is a phone call away. So if you have questions on those documents, I would definitely encourage calling them and, like, "walk me through these." So then by the time you get to closing, you're ready to sign.

Make sure you lean on your resources and have fun

Danielle 19:32
So we kind of just like walked through the whole process and kind of taking a holistic look at everything. If- you know what is kind of maybe the one like, question or the one thing that you would want to answer or tell someone who's like, thinking about buying a home, like, if they were to walk away from one thing, from everything you just said, like, what is that? What is that?

Tara Rutz 19:55
Hmm, that's a good one. I think the biggest thing would be, like, it can be overwhelming, but just try to definitely lean on your resources, because it is also very fun. You know, when you guys were talking earlier about like a home, and it can be intimidating and it can be but then you're also talking about the memories, and I think that's the one thing that I think of when it comes to home ownership. You know, when I think of my home, I think of like, what I'm what my kids will remember, right? Like they'll wake up Christmas morning and they remember our home. They'll remember the yard that we played games in. They'll remember, you know, just all of that stuff. I think that's just lifelong memories.

Danielle 20:38
Oh, I love that

Amber 20:40
Me too. It makes me think about the memories like my nephews and niece that come over often, and I have, goodness, what is it called, coasters on the table that are now permanently marked with crayon from my niece. So that's my memory. She will not remember because she is far too young. But that's okay.

Tara Rutz 21:04
yeah.

Danielle 21:06
I get that, and I get that just, like, gives me the fuzzies, like it gives me the feelings when you said that, because, like, I just think about my girls and them, they have like, their own rooms, and they've painted them like, three times, and like we do all kinds of shenanigans that, like, I hope they remember, right?

Tara Rutz 21.28
The journey of it, yep, is the memory in itself well.

How to use home equity to improve your home

Amber 21:31
And I think even like painting houses or like rooms like that, to make those memories, sometimes you want to do something bigger. Like, maybe it's redoing the bathroom. Because you bought that house, it was built in 1970 and that bathroom sure reminds you of 1970 and we wanna bring it 2025 right? What are ways that people can look at doing that, like in a way to use their home, maybe as as collateral, or like, tapping into the equity, yeah, how do you

Danielle 22:03
Yeah, how do you afford you're doing your bathroom when you don't have, you know, $15,000 in savings account?

Tara Rutz 22:13
Right? Yeah. I mean, I think it's a lot like, you know, we're talking about saving 20% down. And sometimes that can be hard. It's kind of the same thing when you're doing those big home improvements, you know, you're talking about, like, building a shed, or, you know, some of those bigger, I bigger ticket items when you have the equity in your home, then you can do a couple different options, home equity loan or a HELOC home equity line of credit. So fixed home equity loan is just going to be kind of like a car loan, like you take out a large sum of money up front, you get all the funds, and then you pay it back over a term, up to, typically, 15 years, depending on the lender, but it's a fixed payment. So just like when you buy a car, right? Like you walk in, you get a sum of money, you expect a monthly payment for the next so long, and you pay it back. Home Equity Line of Credit is a little different. So some people might use the home equity line of credit if they expect to do, like, a lot of small projects, you know, like, I want to do a bathroom remodel, and then I want to pay it off, but then I want to do a kitchen remodel, and then I want to pay it off, and then I want to do and the benefit to the home equity line of credit is you can use it and pay it back. Use it, pay it back. Use it, pay it back.

Danielle 23:10
So it's just open?

Tara Rutz 23:12
It's an open line of credit, but it's using the equity in your home as collateral, so you're going to get a lower interest rate compared to like an unsecured line of credit.

Amber 23:19
So it's kind of like a credit card without the card.

Tara Rutz 23:21
Right exactly.

Amber 23:22
Because it's, like, attached to an account, and you draw off of it, and then you pay it back. There's minimums based off the amount owed, like a credit card.

Tara Rutz 23:30
Yep, yeah. Yep. You just, well, here at Affinity, you just, like, transfer it from your checking into like, or from the line of credit into your checking, you know, and then you can just use it as you see fit. And then the payment is always based on what you borrow. \

Danielle 23:43
Oh, okay, awesome. So I could do my bathroom in the beginning of the year and do my floors at the end of the year?

Amber 23:53
You've given her ideas.

Danielle 23:54
I know I'm like is my husband listening to this podcast right now? Because we have projects to do.

Tara Rutz 23:59
Wheels are spinning.

Danielle 24:03
So now we've just to recap, a small recap we've done, you know, home buying, and what does that look like? And then how do you use the equity in your home to do like, a home improvement project or keep up on your home? So now, kind of looking at those two things together, like, what else is there? What haven't we covered? What do we need to know?

Tara Rutz 24:24
Yeah, I think another good thing that I would for those that are preparing to buy a home or thinking about it, would just be like looking online for, like, seminars, classes. There's a lot of online tools out there, calculators we talked about before, just like to see what payments would look like. So there's a lot of free education, I would definitely take advantage of some of those opportunities just to know what is home ownership entails.

Amber 24:49
And any questions that maybe you weren't able to find an online resource on you can ask your mortgage officer.

Tara Rutz 24:54
Yep, absolutely Yep. Mm

Amber 24:57
Find an expert. 

Danielle 25:01
Big fan. Is there an adult in the room?

Amber 25:06
Tara, please help us.

Homeowners Insurance

Danielle 25:10
So now I guess I mean, like, I own a home. Amber, you own a home. But like you mentioned earlier, there's a whole like, servicing piece, like, there's a whole team to kind of support you now that you own a home, and you mentioned, you know, like homeowners claims, things like that. So can you just kind of like, walk us through what that looks like, or what that team kind of can help us with now that we're in our home?

Tara Rutz 25:37
Yeah. So basically, on the servicing side, or is really when you own a home, a couple things that are taken care of through there is like paying your property taxes, managing your escrow accounts, so for those members that choose to escrow or making sure homeowners insurance premiums get paid that you know the lender is listed, so that if something happens. One thing I would share is that many think that you can't switch homeowners insurance because you escrow. I would check with your lender, but generally that's not the case. You still are able to choose who you want to go through, through for homeowners insurance. You just have to work with your lender so that it's listed properly and they get the proper documentation. But definitely something you could still do.

Amber 26:19
That's a really good point, because, I mean, budgets change, you may find a better option for bundling if you had different car insurance. And that's just a nice tip to have, because I've switched insurance companies a couple times, and not only is it a lot to manage all at once, but not escrowing, I thought was a little easier for me until I had to pay all the premiums up front and wait for a refund, and that was not fun. Yeah, if you escrow, you don't necessarily have to do that depending on your lender.

Tara Rutz 26:53
Right exactly. Yep, the typically, the lender can pay that up from premium, and then you would just refund your escrow account back once you get the refund from your other insurance company.

Danielle 27:03
So just thinking through, I mean, like, we live in Minnesota, we all weather.

Tara Rutz 27:10
We're here to help in those situations, because it is an overwhelming process. Like, you know, there's a lot, not only is there a lot of money, but you know, we're talking about making your home your own, and now it's just been, like, ruined by a storm. There's a lot of emotions involved in like, where do you go next? Who do you have to talk to? You know, who do you trust? So there's a lot of moving parts. Just like when you buy a home, there's a lot of stuff happening.

Amber 27:35
Well, that's why we have a servicing department here, and that's why most lenders do, f they're, if they're offering the escrow side of things, they do partner with you, which is such a huge benefit. And I think that's really where finding the lender that you feel that care and trust from, I think is most important for each individual person out there.

Tara Rutz 27:54
Yep. The other thing I would say for in regards to servicing or your homeowners insurance is to, like, pay attention to when you get it from your insurance company and review it at that time, versus waiting for when you get your escrow.

Amber 28:09
That's a really good point, because your insurance could renew in August,

Tara Rutz 28:13
Yeah.

Amber 28:13
But escrow was done in June.

Tara Rutz 28:15
Right. So then you have a whole year, like, a year of catching up. So every lender is different on when they do it. But if you are in that situation, you know you're kind of behind on month one, and so then when you get escrow of next year, you're having to kind of play catch up. So pay attention to your homeowners insurance when it comes and talk with your lender to see how you can adjust when your insurance adjusts, or even switch insurance, if that's what you choose to do. But just figuring out, like, how can you be proactive for when the next escrow season comes around.

Amber 28:45
Or call your insurance agent when you get that bill. Because I was lucky enough to where mine called me because my premium was going to go up over $2,000 this year just because of things in the world impacting it outside of weather, and through that conversation, we're able to find different discounts for me in particular. And I think that was where I was like, Oh, I definitely want to stay with you because you gave me a call and a heads up. Because that would have been a real surprise, and I probably would have looked elsewhere and maybe received the same types of discounts.

Outro

Tara Rutz 29:21
Yep, exactly.

Danielle 29:22
Well, Tara, we really want to thank you for coming on the podcast today.

Tara Rutz 29:26
Yeah, thank you for having me.

Danielle 29:27
Yeah, it's been enlightening. And I hope everyone like feels a little bit more comfortable with like, the home buying process, or at least coming in and starting that conversation. If you feel like that's you know, you know, you might not be ready today, but let's figure out how we can get you there, because it is a lot, but the end result is so worth it.

Amber 29:49
Oh my goodness, the reward at the end.

Tara Rutz 29:51
Yeah, definitely worth it.

Amber 29:53
It's like the pot of gold at the end of a rainbow.

Danielle 29:57
It really is. So we just really appreciate your time and your expertise on the podcast.

Tara Rutz 30:03
Yes, thank you again for having me.

Danielle 30:05
Well, thank you for joining us today on the A+ you podcast. Be sure to follow us wherever you listen to podcasts, and to continue to learn more about banking and to stay up to date with affinity. Plus check us out at affinityplus.org

Amber 30:19
We look forward to having you join us for the next episode of A+ You

Danielle 30:23
Affinity Plus is an equal housing lender, and federally insured by the NCUA.