Jen O’Hanlon: So, we’re all started and ready to go? Should I start? See, like all this is going to get cut out.
Hi everyone. I’m Jen O’Hanlon with Wallace and Company, Sotheby’s International Realty. I am here today in Edgartown with Michelle Oteri, with Allied Mortgage Group. And she is going to tell us a little bit about what she does. Michelle, can you tell me how you got into the loan business and mortgages?
Michelle Oteri: Yes. I have been doing it for 28 years now. I started out as a receptionist when I was 19. It was just a temp job and I just liked it, and just kept moving up the ranks.
Jen O’Hanlon: What sets you apart from going to a bank or working with you?
Michelle Oteri: I am a full service mortgage lender. So same as a bank, but when the program doesn’t fit into that perfect box, like a bank. They would say, “We can’t do financing for you.” I have the opportunity to be a broker, and go find a bank or an investor that will do the loan. So I can essentially just about finance anybody.
Jen O’Hanlon: What is the number one question that people, when they first call you and they’re thinking about making a purchase. What is a question that you usually get from people?
Michelle Oteri: I would say the biggest thing is down payment. People think you need to put 10% to 20% down, and that is just not true. You can put 3% down, there are programs with no money down. It really opens up the doors to a lot of people for buying a house with 3.5% down or 5% down.
Jen O’Hanlon: I know of a lot of people who ask me and they’ll say, “Oh, do I need 20% down?” So what is the difference? I know there’s private mortgage insurance that people pay sometimes, and when does that come into play?
Michelle Oteri: When you don’t put 20% down, you do have to have mortgage insurance. Or if it’s FHA, if it’s private mortgage insurance premium, those are two interchangeable words.
Jen O’Hanlon: If somebody is purchasing that for their primary residence, is that when you can do less than the 10%?
Michelle Oteri: Correct. Second home and investment properties require a larger down payment because it’s a higher risk. You’re going to be looking at 10% to 15% down for those programs.
Jen O’Hanlon: On the island, we have a lot of people who are buying a second home or an investment property. Sometimes I have this question asked of me, “What’s the difference between an investment property, and a vacation home or a second home?”
Michelle Oteri: Well, if it’s an investment property, you can actually use rental income to qualify. Where a second home, you would have to carry your primary mortgage and the second home. That would be a difference, and that just really depends on income and qualification.
Jen O’Hanlon: Great.
Michelle Oteri: Can I drink water? (laughing)
Speaker 3: Yes.
Speaker 4: Absolutely, yes. I would say-
Jen O’Hanlon: You and I were talking the other day about construction loans. Something that I found really surprising was the rate that you had was, I think similar to something for a primary residence? Is that true, a regular loan as opposed to a construction loan?
Michelle Oteri: Yes. That’s an investor that I use and they are just trying to get into the construction market, so they’re just offering excellent rates.
Jen O’Hanlon: Great. This question is another… Well, not a question, but this is something that I’ve learned, mostly just talking to you over the past several years. There are certain things that buyers should not do. What are the things that somebody needs to be aware of that they should not do before they close?
Michelle Oteri: Very important. Definitely do not quit your job. Do not buy a new car. Do not get any new credit, if possible. A lot of people have gone out and gotten all new appliances, all new furniture. You get to the closing table, we re-pull credit and they don’t qualify anymore. Any major purchases, wait until after the closing. Any job changes, if you have to change a job that’s fine, but don’t quit a job without another one lined up.
Jen O’Hanlon: And maybe call you first?
Michelle Oteri: Yes, for sure.
Jen O’Hanlon: That’s what I tell people, “Call Michelle.” Anything else you want to talk about? I can tell everybody where your office is. You are in Nevin Square in Edgartown and people can just stop by, you’re upstairs. Anything else?
Michelle Oteri: I don’t think so.
Jen O’Hanlon: Something that some people don’t really like to talk about, but let’s put it out there. Credit scores. Some of us aren’t awesome about paying our bills on time, or we have things that happen to us in life. I am wondering, what do people need? A really great credit score or how does it work? Can they buy a house if they don’t have perfect credit?
Michelle Oteri: They can. It’s best to have as high of credit score as you can get. I work with people doing that beforehand, if they do have a few credit blemishes. But I can do loans for people in the 500s. If they absolutely, they’re going through a divorce and they got horrible credit, but they have money to put down. Get into the house, work on the credit for a couple months, and then refinance to get a lower rate. Because we can do loans in the 500s, it’s just that the rates are going to be higher.
Jen O’Hanlon: What do you recommend for people if they do need to work on their credit?
Michelle Oteri: Call me before they want to buy a house. I work with some customers a year, depending on how bad a shape they’re in. I can give them pointers, I can tell them exactly what to do. So just get in touch. I’m happy to just consult with people and go over a game plan.
Jen O’Hanlon: Perfect.
Michelle Oteri: I never have bugs in my office (swatting the air)
Jen O’Hanlon: To close, I would love to know what you love about the business.
Michelle Oteri: I do love helping people. I love educating people about the process, because it is a scary, huge thing that you’re purchasing. It’s fun to help people buy a home, too. It’s rewarding.
Jen O’Hanlon: That’s great.
Speaker 4: Last, how many years she have been doing.
Jen O’Hanlon: Yes, that was the beginning. I don’t know where you were (laughing).
Speaker 4: I was outside.