Divorce, Mortgages, And Hard Choices

What happens when the most emotional decision in a divorce is also the most expensive one? We sit down with top-five loan originator Ben Cohen to map the real choices families face when a house, a mortgage, and a separation collide. From the first “can I keep it?” to the final signatures, we break down how lenders think, what underwriters require, and the smart ways to structure your decree so the numbers actually work.

We start with the human side: why determining whether things are amicable shapes the entire financing path. Then we get into the mechanics. You’ll hear the exact rules for using support to qualify—six months of proven payments and at least three years of continuance—and what to do if the timeline won’t fit standard underwriting. Ben explains portfolio solutions like asset depletion, turning lump sums or investment accounts into qualifying income without forced withdrawals, and how that can open doors for a spouse who hasn’t had reportable earnings.

Rates are the elephant in the room. Many couples are locked into 3 percent loans, yet need a refinance to remove a name or pay out equity. We dig into the tradeoffs: the risk of staying on a joint mortgage, how to negotiate principal pay-downs or support adjustments to keep payments livable, and the powerful difference between rate-and-term and cash-out refinances. One key tip: clear decree language can classify an equity payout as rate-and-term, often earning better pricing than a cash-out. We also tackle second mortgage hurdles, when an ARM may (or may not) help, and how shifting policy and first-time buyer programs can influence affordability.

If you’re navigating a split and a mortgage at the same time, this conversation gives you a playbook: engage a lender early, stress-test scenarios with your attorney, and write your decree to align with lending reality. Subscribe, share this episode with someone who needs it, and leave a review with your biggest mortgage question—we’ll tackle it in a future show.

Transcript

New Season And Guest Intro

Speaker 1 0:00

Welcome to ATD, the All Things Divorce podcast. I'm your host, Jonathan Merel. Welcome to the All Things Divorce Podcast. I'm your host, Jonathan Merrel. Wishing you all a happy new year. We're back for a new season, a new year. I'm very lucky today. I have a very, very special guest. Ben Cohen, who's to my right, is the managing director of Guaranteed Rate, which I'm sure all of you have heard of. He's a top five loan originator for residential mortgages in the entire United States. And he's also my partner in the Curtis Cup Golf Tournament, which we haven't really passed the second round, but this year. Have we not made it yet? I mean, I don't know if we've made it a year. This is our year. But this is our year. We say this every year, but um, he's also a great friend of mine. So full transparency here. But I'm very lucky to have him on the show. We've got a lot of good things to talk about. We're gonna talk about the intersection between divorce and mortgages. There's no one better to talk to than Ben Cohen, and welcome to the show. Thanks for having me, pal. I'm I'm happy you're here. So we're just gonna get right into it. I mean, Ben, you've been doing this for two decades, probably more. Yeah. Um, you've dealt with clients. I know you've dealt with clients of mine. I'm sure you've dealt with many other clients going through a divorce because you've helped thousands of people. Um, what's difficult? What's the most differentiating factor? What's what's the difference when you're dealing with someone who's going through a divorce, helping them get a mortgage when you're dealing with some as opposed to dealing with someone who's just going through the regular channels? What what obstacles are there? What do you see that is different? I'm sure there's more stress involved when you have people going through it, but I don't know what what's different.

Emotional Hurdles In Divorce Financing

Speaker 1:59

I mean, you live and breathe this all day long every day, right? And we have a lot of side conversations about this. Um, I would tell you probably the most important or the most difficult is just the emotional aspect of what somebody is going through. Yes. Um, whether it's one spouse or the other spouse, who wants it, who doesn't want it. You know, one of the first converse the one of the first questions I always ask a customer when they call me and they say they're going through this is are you amicable or are you not amicable?

Speaker 2 2:32

Right.

Speaker 2:32

Right. And and I asked that question for one basic reason. If you're amicable, then I understand you guys are working towards the same goal. Right. If you're not amicable, well, then I know what we're dealing with. And at the end of the day, I will come back to them and tell them what they can or can't do. But then I'm gonna go say you have to talk to Jonathan. Right. Because just because I say you can do this doesn't mean you're going to do this or your attorney's going to advise you to do that. So I mean, everybody's emotional right now when they buy a house. There's just something that comes with buying a house, but the sensitivity is heightened dramatically.

Speaker 1 3:08

Yeah. And I'm assuming, like, you know, people, you know, purchasing a home and whether it be a purchase or refinance, obviously, mostly purchasing is supposed to be a happy time in people's lives when you kind of get into the divorce world, you know, it's someone reluctantly having to move out of a house or, you know, sell a house and purchase something else. So, you know, what's supposed to be a happy moment can often turn into an unhappy moment, a stressful moment. So I'm sure, you know, as we see the stress of it, you can see the stress, you sense the stress, and it's probably just a different vibe overall for the transaction.

Speaker 3:42

Absolutely.

Speaker 1 3:43

So, yeah, that's definitely something we see, you see. And again, we're kind of both like mental health therapists, helping them get through this, explaining things are stressful. Everything you ask them can be very troubling or difficult or stressful. So we get it. We do the same thing, we do different things, but we operate in the same way.

Speaker 4:02

And I approach it like, listen, I'm gonna ask you some very poignant personal questions. Yeah, not necessarily because I want to know all the intimate details of your life, but the more I know, the better I can help you to figure out what you can or can't do.

Speaker 1 4:16

And I know that firsthand because I've sent you many clients, they've all said how great you were to work with, how easy you were to work with, how quickly it got it done. And that's helpful because a lot of mortgage brokers don't have the experience that you have, don't have the credibility, don't have the pedigree you have. And, you know, it's an important choice who's doing your loan, just like it is who's being your divorce lawyer, you got to get them to the right person. 100%. Um, all right. Next. When should someone going through a divorce start thinking about their mortgage situation? Is there such a thing as too early, too late? Obviously, you know, the house, the marital residence in a divorce is a central piece of a person's marital estate typically. And you know, people might when they're starting to see their marriage break down, I think one of the first things people think about is shit, what's gonna happen with the house? Can I stay in the house? Are we gonna be able to afford two households? We're both on the mortgage. So, like, how early in the process do you think people should start thinking about it?

When To Engage A Lender

Speaker 5:10

Never too early. Just like I talk about people who are going and buying a house and say, when should I figure out what I can qualify for to get a mortgage? Like, I don't care whether you buy a house in a day, a month, or in a year. Like you can never figure out too early what can I do and what I can't do. Exactly. The same thing applies with the divorce situation because when we come back and understand what your situation is, are you getting a lump sum payment? Right. Are you getting alimony? Are you getting maintenance? Right. Are you, you know, are you retaining the house? Are you not retaining the house? A lot of people don't even understand what their options are. You at a high level, because you're also very good at what you do, you know, and you can explain. Look, here's the different circumstances that could happen. Right. You could sell the house, you could keep the house, you could, you know, one spouse is gonna get the house, the other spouse isn't. Right. There is equity play out sometimes. Sometimes the equity is a component of the divorce. Yeah. Sometimes the equity is not because you're gonna figure out the other assets. So um, the long-winded answer to your short question is you can never figure it out too early. That makes sense. Day one.

Speaker 1 6:17

And you you just touched upon it, but you know, maintenance support is often a big factor when people are talking about a refi or can I qualify for a mortgage? Because many situations you have one spouse, maybe well, maybe it's a long marriage, they've worked the whole time. Well, one spouse has stayed home taking care of the kids. You know, you have the earner and you have the person who's kind of stayed home to keep the household together. That happens all the time. And then oftentimes the person who's never really had any income and all the income was through the breadwinner, they've got to get a mortgage. And they have no history of showing income. They have no reportable income, no W-2s, no any, no income of any sort. And then all of a sudden they're faced with the task, well, how am I gonna get a mortgage when my spouse is off on their own and I'm stuck here? And they often think, like, well, how does it work when I'm going to be getting support, whether it be maintenance, child support, and I need to show that as my only income, will that help me get a mortgage? How does that work when you're trying to show income for someone that's getting support for the first time and has no income in the business?

Using Support Income To Qualify

Speaker 7:21

Yeah, so you threw a lot at me there. So I'll try to go through. Break it down. Break it down. So a couple things. Number one, what you'll find out is let's just call it the breadwinner, the person who actually, you know, you've got the person who sometimes is going out and working, and then you have the other person who's working but not outside the home. Right. Right. So um, like I couldn't do that job. I couldn't stay home with my three kids every day. Like you couldn't pay me enough to do that. I'm not qualified to do that job. Um so the person who is, let's just use an example. If the if the spouse is retaining the house um and they've never worked before, typically they're not the one who has gone through the financing process and getting the mortgage. So it's now they're getting divorced, everything's new to them. They don't even know how to spell mortgage, what it means, how to get it. So you've got all this coming at them at one time, and they're going through the emotion and coming to grips with I'm going through a divorce, whether they want that divorce or they don't want that divorce. Right. Um, so so that's part of it. The standard rule of thumb is when you are using maintenance and you are using alimony to qualify for a mortgage. Right. So you and I are married, you've never worked before, you're now retaining the home as an example. And you come to me and say, Ben, I want to buy a house or I need to refinance my house. Whether you purchase or refinance, yeah, it's really the same situation. There's no difference. There's no real difference. Okay. Um, what happens is the standard rule of thumb is you have to show number one, there has to be a, you know, either a a legal separation agreement or B a divorce degree. So correct me if I'm wrong. There's typically not a legal separation agreement before.

Speaker 1 9:09

Yeah, so you need a final judgment usually. Yes. And you'll utilize the number in the judgment. Yes. And then isn't there a period of time? There's a decent period of time. So say you're paying me 10,000 a month on January 1st, 2026. I need to get a mortgage. How long do I have to show the lenders that I have consistent? Okay. So once I've received the maintenance of 10,000 a month for the first six months, then I could then I could seek a mortgage. Yes.

Speaker 9:38

And before that, I'm gonna have a tough time. You are gonna have tough time. Now there's always things we can, and we'll get into like how we think outside the box.

Speaker 2 9:45

Sure.

Speaker 9:46

Um, because part of your job is thinking outside the box. And I know your job is thinking outside the box. So the standard, typical, normal, which I try to stay away from those words because I don't believe they exist in our vocabulary anymore, is you have to be showing six months of getting those payments. Everybody's always like, well, why?

Speaker 2 10:05

Right.

Speaker 10:05

Well, you can probably appreciate this better than most. Why is because a lot of people don't do what their divorce decree states they have to do. So a lender wants to see that, you know, if I'm slated to pay you $10,000 a month in income, I'm actually fulfilling it and I'm paying you not $8,000 one day and $12,000 the next month and six. It's got to be consistent, it's got to the same amount. On top of it, you also have to be able to show a three-year continuance of receiving that income. So it's not only show me proof that you've received it for six months, you also have to show me proof that it's gonna continue for three months.

Speaker 1 10:44

So the orders to show, like, you know, it's for the next 10 years. Yes. So if we even though you paid me six months, if the maintenance is supposed to end after a year, how's that gonna work?

Speaker 10:54

Doesn't work.

Speaker 1 10:54

Okay.

Speaker 10:55

That's okay. So when we talk about thinking outside the box, that's just the standard what we call in our world, full documentation loan, right? Like that's income, assets, credit, uh, job, whatever the situation might be. Well, as we sit here in 2026, which I can't even believe I'm saying it's 2026, there's a lot of different portfolio products. Okay. And what I mean by that is there's a lot of clients, whether you're going through a divorce or you're not going through a divorce. Um, this is popular to my self-employed clients, where they make a lot of money, but to the IRS, they don't show the IRS a lot of money. So there's asset depletion loans. Okay. Um, we qualify you on that standard. So what is what is an asset? So an asset depletion loan is we're getting divorced. Let's just use you and I. We're married, we're getting divorced. It is really cute. We are partners and act like a married couple on the golf course. So we can let each other.

Speaker 1 11:50

That's true.

Speaker 11:51

Although we don't allow each other to apologize when we make a mistake. Even though we say I'm sorry every shot. Sorry. Um, so um asset depletion. So that's if you get into a situation where there's a lot of times, and correct me if I'm wrong, it's not always you're getting alimony or you're getting maintenance. I'm just gonna give you a lump.

Speaker 1 12:12

Yeah, of course.

Portfolio And Asset-Depletion Options

Speaker 12:12

There's buyouts, there's obviously getting disproportionate shares of kids, you know, what you have to do with parents who don't have kids, like every that is the other critical thing I will tell people is everybody's situation is completely unique. Right. You could refer me 10 clients getting divorced, right? And we're gonna structure a loan 10 different ways based on their unique situation. So um, an asset depletion loan is very simple. Let's just use easy math, okay? You're gonna go give me a million dollars as an example. Uh, you're saying we're just gonna wipe the slate clean, give me a million dollars. The property set up. Forget the property, forget everything else. There's no alimony, there's no maintenance. I'm just giving you cash. Okay. We take a million dollars, we take 80% of that, which is $800,000, we divide it by seven years, and we turn that into a monthly income stream. We don't we don't hold your assets as collateral. We don't say you have to put it in this market or not this market. We just you show us what you have, we do a calculation on it, we take 80% of it. Now it's what we take of it's different. If it's a 401k, if it's a brokerage, if it's cash, some we use 100%, some we use 80%, some we use 70%. Um, we turn those assets into just a monthly income generator, how we qualify you on paper. That's what I talk about when we call a portfolio.

Speaker 1 13:36

So that creates your income essentially that you're income.

Speaker 13:39

You don't have to go say, well, Ben, am I setting up a $10,000 draw to buy assets? No, you don't have to do any of that. We just use it as a calculation. It's all, yeah, it's theoretical. And that that's enough for the lenders to approve? Well, depending on if you're going and spending $5 million, no, $10,000 is not enough income for you. Right. So it's all relative to how you still have to make sure your budget is in line with what you're trying to spend. Gotcha. Okay. If you're going getting a million dollars and you're going to buy a $500,000 home, but of that $500,000 home, you're putting down $100,000 and you're taking it from the money you just got. Right. Well, now we're going to subtract that out. Right. Right. So now you only have $900,000 of usable assets. Right, right. So that's how if you're in a situation where you're getting divorced, but you know, these things don't just happen overnight. You don't just click a snap your fingers and you're divorced the next day. Of course. Um, it doesn't work like that. Just like I tell people these days, it's it's not push button, get mortgage. Right. You don't push a button and get a home tomorrow. It doesn't work like that. Right. Um, you know, the DNA sample, the colonoscopy, all the things that we have to do behind the scenes for people. So, so again, like that's why when you asked me to go back to your first question, like, when is too soon to start? There's never too soon because I might give you the information and you might go back to your attorney and say, look, I talked to my lender, right? And like, I really it's really important that I stay in this house. It's really important that we sell this house and I have the ability to go buy another house. Right. What do I need to do? By the way, the flip side of things too, when I think you asked me about like challenges, yeah. The flip side, we're just talking about the person getting the money and that. Of course. Don't forget about the person who's now carrying the liability. Right. Right. Like the person who is the breadwinner and is now going to say, I'm giving my spouse the house and I'm going to go buy myself a new house. Okay, well, what do you have to pay her per month? Right. That works both ways as a liability and as a that can have an impact on somebody who's getting divorced. Right. Who, like, now all of a sudden they can't get qualified because they have to pay out their spouse X dollars per month or lumpy, lumpy, yeah, monthly, and that's gonna have an impact on their quality. So it works both sides of the equation.

High Rates, Low Legacy Loans

Speaker 1 15:59

And that's why you need an experienced mortgage lender, mortgage broker when you're in situations like this. This is why I send my clients to Ben, because you need someone creative, you need someone with the acumen and the experience he has and who can get creative, because in situations like this, there's gonna need to be a lot of creativity, especially with the climate we're in, which brings me to my next question. All right, interest rates are high compared to where they were before. I know historically the interest rates we're at now are not terrible, but when you're talking about interest rates being a lot higher, when what I see, and I'm sure you see, is we have people getting divorced. Their home is their home has a mortgage, it's locked into a rate of 3%. Mortgage rates are obviously much higher now. There become obligations down the road that you need to refinance or get your partner, your ex off the mortgage in order to maintain the house, because you know, people who essentially gave up the house to their spouse don't want to remain on the mortgage forever. And there's usually a period of time where they can either sell the house or refinance the house. But refinancing creates a big problem when you have people locked at a 3% mortgage with a lower payment, and now to refi, they've got to get a new loan at 7% or whatever it is now. The payment's gonna be a lot more. I'm sure you've seen this. What do we do? What do people do? It's tough for divorce, it's tough for them. I mean, there's obviously a lot of things we can try to negotiate and obviously say this was unforeseen three years ago or five years ago. I mean, what what can you do? I mean, I know there's not a lot of great options, but what do you think?

Speaker 17:39

The good old artificial days, as I call them in the pandemic, right? Exactly. You know, I don't think um whether it's the governments or the lenders out there real realize what the long-term repercussions were of giving people 3% mortgages, right? That it was gonna feel like you were locked in your home. You know, a little interesting fact on a side topic here is that like we're one of the only countries that has a 30-year fixed rate mortgage. Really? Yeah. I didn't know. Everybody's always shocked by that. You know, take Canada as an example. You go buy a house in Canada, you have to redo that loan every five years. Wow. And in five years, if interest rates have gone up and you can't qualify for that house, you either have to pay down the loan to qualify, similar to like how a commercial loan is, right? Right. Commercial loans right now, it's all cash in, right? Right? Rents are down, whatever's down, or you have to sell the house.

Speaker 1 18:33

And which makes sense from a lending standpoint, but it obviously can put people in a really tough spot.

Refi vs Cash-Out And Decree Language

Speaker 18:38

Yeah. So, so it, you know, again, that's where whether you're getting divorced or whether you're just buying a new house and you own a current home right now, and you're just coming to grips with like the, oh my God, I'm at two and a half or three percent on my mortgage. And what am I gonna do? Is I mean, I it's it's it's true, and I try to like joke about it a little bit. You know, listen, those were artificial. You are literally sitting on free money right now. And you have to consider yourself that you were lucky you had it as long as you had it. And when you're paying a 3% mortgage, so much more is going to principal and less on interest, where now the principal is less and the interest is greater. So, you know, there is no right or wrong answer to that question, unfortunately. It all comes down to affordability. What can you afford or what can't you afford? Sometimes there are situations where it's amicable, right? And the ex will say, look, I understand, even though the divorce decreased as this, right? We're working together, we've got a family, I don't want my kids on the street, I want to take them out of the school. Like, I'll stay on the mortgage and we don't have to repercuss, we don't have to redo it. The flip side of that is at the end of the day, if you're now paying or you're obligated to pay that debt and Your spouse makes a mistake and misses a payment, that's gonna send you sideways. Right. So you know, that's where there's no like right or wrong answer. It just boils down to, you know, we've seen it all. People are comfortable going from three to six percent. I mean, look, the nice thing to everybody out there is rates aren't eight percent anymore like they were two or three years ago. Now they're coming down to six percent. So, like, you know, relatively speaking, the average mortgage rate over the last 25 years is seven and a quarter percent. So we've all been spoiled. I think that shocks people. We're spoiled. People think they're in the world of 3%, 4%, but that that's over. Think about it. You go buy you buying a car in the pandemic, you were paying 0.9% on your car loan. Now you're paying 6.99%. So it's all relative. Like, as I tell everybody, what isn't more expensive in the world these days? That's true. Your car, your mortgage, your groceries, right? Food, your clothes, like literally everything is more expensive. So that's just the world we live in. I hate to say it, it's hard. Um, so um, you know, again, that's where we'll kind of understand like what's important to you. Right. Okay. If you're getting money paid out, um, you know, sometimes we can reduce the debt to make you comfortable. That could be part of the negotiation you have is the divorce is look like we owe $500,000 on a house and my payment's two grand, and now it's gonna be $3,500. Right. So maybe there's adjustments and support or adjustments and support. How about you pay down the loan $100,000 so I keep my payment in line?

Speaker 1 21:39

That's why these discussions need to be had at the beginning, middle, or before the divorce is finalized. Obviously, you have self-executing provisions from divorce decrees in the past that become due and something's gotta give. But if you're going through a divorce now, you have to consult with a mortgage broker from the beginning because if the house is central to the resolution of the case and there's going to be obviously someone taking over the house or someone leaving the house, these are decisions that have to be made. And refinancing is an option. Um, staying on the mortgage is an option. What can the other spouse do who's staying on the mortgage? Is it hard, generally speaking, for like for someone to get a second mortgage? Like, say the person who left, they've got they're on a house, they're on the mortgage for the former marital residents for $500,000, and then they want to go out and buy their own house. I mean, obviously, it's all depends on income and assets and all that, but generally speaking, that's tricky.

Speaker 22:35

It's it's it it it's tougher, you know. Believe it or not, it's harder to qualify for that second mortgage, that $100,000 or $200,000 mortgage than it is that $500,000 mortgage. The product depth isn't as vast, right? You can't do portfolio type stuff as a second mortgage, they're in second position on title. So if something goes sideways, they're the ones who get left in the dust. So the requirements, it's not that it's not possible, it's definitely more difficult. Right. Um, you know, when we talk about the refinancing, and this might be one of your questions down the line. So we might be getting ahead of ourselves. You know, when you're doing a when you're maintaining when you're the when you as the spouse are awarded the home in the divorce, yeah, and you have to refinance the mortgage as an example. If that's a provision in the decree, um, sometimes it's just I have to refinance what I owe. Right. Or sometimes it's I have to refinance and I have to take cash out to pay out my spouse. And they're interested. So there's an equity play out there too. Yes. And this is a little interesting factoid that's important. I want to hear this. If it's when you're the best mortgage you can get is when you buy a house, a purchase mortgage. Okay. The second best mortgage is when you do what's called a rate and term, where you just refinance what the debt is. Okay. Okay. So you're gonna get a six percent rate when you purchase a home. You're gonna six and a quarter percent when you just refinance the rate. Okay. Because again, they're motivated to give you the best money when you're buying um because they want you to buy a home. Right. Then when you do a cash out refinance, you get even a higher rate because a cash out refi, statistically speaking, is a riskier type of a mortgage. Because there's less equity in the house. There's less equity in the house. And people peep typically when people are taking a cash out refinance, they're taking cash out to live their life.

Speaker 2 24:28

Right.

Speaker 24:29

The goal is not to take cash out to live your life.

Speaker 2 24:32

Right.

Second Mortgages And Qualifying Constraints

Speaker 24:32

We still need to make sure you that so it's all just what I call interest rate adjustments. You go from six percent to purchase, six and a quarter to rate and term, six and a half or six, seven, five to do a cash out. Um, but when you're getting divorced, if the divorce decree states that we're gonna equally agree to each get our own appraisal, because you know that's always what happens, right? You order one, I order one, and you're, you know, if you're selling the house, if you're not staying in the house, you want a low appraisal. If you're staying in the house, you want a high appraisal, like all these little things, guys, that go into the equation, right? And I think what makes me really good at what I do and what makes Jonathan really good at what we do is I think we're capable capable of making a decision that's in the best interest of everybody. I always tell clients, look, if your ex was on the phone with me, we'd be having the same conversation because there's a pro and a con to what situation you're in. But when you do a divorce decree and there's an equity payout, if it states, again, let's use easy numbers, the home's worth a million dollars, we owe $500,000 on the home. I now owe you half of the $500,000, $250,000. Yeah. So now I need to take a mortgage for $750. If the divorce decree states that, it's considered a rate and term refinance and not a cash out refinance, which gets you a better rate on your mortgage.

Speaker 1 25:52

Better rate. Okay.

Speaker 25:54

Remember, purchase, rate and term, cash out, and that part of it.

Speaker 1 25:58

That's good advice because that's important to think about, not just for clients, but divorce lawyers too, to give this advice. Absolutely. That's why I have people like Ben. Clients appreciate them. Another thing is sometimes when you get in the middle of a divorce, if you know, one lawyer kind of um, you know, suggests one mortgage broker, the other one, well, I don't want to use Meryl's suggestion, we want to use mine. Many times everyone's gonna know Ben. He does great work, his reputation is great, and usually there won't be a fight when they know someone who has the reputation of Ben. So that's also something.

Speaker 26:32

And by the way, if there is, like you we all understand it, right? Like you don't like to be forced on anybody at the end of the day. This is like the exact circumstance I deal with when there's a deal going in process, forget divorce aside, and um the buyer can't get the financing. And the seller says, Well, you know what? Call my guy.

Speaker 2 26:51

Right.

Speaker 26:52

Right. And their immediate reaction is, I don't want to call your guy. You guys are in cahoots. Well, number one, the law doesn't allow me to be in cahoots. And when that buyer actually calls me, it's like, look, now you are my client. Okay. So do I know the seller or do I have a relationship with the people selling the home, the listing agent, the attorney? Yeah, but now you are my client. So it kind of becomes attorney-client privilege. Like, I'm here to help you. And if I can help you, we'll help you. And if I can't, it's all good. And then normally when people feel like they're not being forced on you, yeah, and they kind of take a step back, they put their hands down a little bit, and they're like, okay, great, let's do this. And now everybody loves us at the end of the day. So, you know, but that's really important. That whole cash out versus not cash out. Um, you know, but by the way, if you do structure that in the divorce decree, um, and the proceeds are going to the spouse, yeah, that money at closing has to go to the spouse. Okay. I don't give it to you and say, Right, don't go on with it. Good luck. You have to pay has to go payable to the person getting the funds. Right. So that protects everybody. That makes you, as their attorney, feel helpful. You're not gonna let your client get money and then hope that they're gonna turn around. You can't trust anybody, unfortunately.

Arms, Rates, And Strategy

Speaker 1 28:09

Anything can happen in the divorce world for sure. Um good questions, by the way. Yeah, I mean, I think we covered tons of this. I mean, I know I had other questions, but we've kind of tied everything in together by answering these. I'm trying to think anything else. Like, I guess when we're talking about rates, this is kind of just a one-off thing. Like, and people are tied to a 30-year fix and the rate's too high, or they maybe think they're not gonna be able to afford it. Are there are like loans like arms, are those options available to people that gives like less lower rate? It's scary because you're locking into a lower term. You know, I guess what do you recommend to people in these situations where they're like, I need a lower rate? Is an arm the answer?

Speaker 28:48

It depends on the situation. Okay. Um, if today a 30-year fixed is six and a quarter, and again, like take all of this.

Speaker 2 28:56

Yeah, I know, of course.

Speaker 28:58

Everybody's situation is completely unique, completely different. I hate talking about interest rates when I don't know anything about somebody. That's like when somebody calls me and it's like, well, what's your rate today? Right. I don't know. Like, how what's your credit? What's your income? How much are you spending? Right. What are you buying? Are you buying a condo? Are you buying a house? Like, you know, exactly. Like it's such a loaded question. Like, if you want that, just go to Chat GBT and find out what the average interest rate is. So, because that's pretty much what I'm gonna do, anyways, these days with how AI is focusing on our business. But you know, you've got fixed rate mortgages, you've got arms, you know. Typically, arms were a half to three-quarters of a percent cheaper than a 30-year fixed rate mortgage. Now, because of the financial markets, we've had what's been called an inverted yield curve, where in layman's terms, basically what that means is arms might be an eighth of a point cheaper, they might be a half a point cheaper. Like we don't be a huge difference, nothing huge. But again, depends on are we financing 200 grand? Are we financing $2 million? You know, a quarter point on two million is much different than a quarter point on $400,000. So sometimes the juice is worth the squeeze for people. Sometimes it is, sometimes it's not. Sometimes people are comfortable doing an arm, sometimes people are not. Right. Um, you know, if you're in the camp like we all are these days, where everything you see on the headlines, I mean, look, Powell's like being investigated by the DOJ right now because he's not gonna lower interest rates. Like, so like my theory is, and I don't have my degree in economics, um, nor do I have a master's degree in economics. You know, my belief is that there's probably gonna be a new Fed chairman. Right. And when there's a new Fed chair put in place, you're probably gonna see rates start to go because Trump is going to put somebody in there that is gonna do whatever he tells them to do, um, whether you like that or love that. Um, and that's really what's gonna happen. So, you know, as I tell people right now, you know, you you marry the house and date the rate, right? Right? That's we talked about it. That's what I was thinking of. Yes, marry the house, date the rate the house and date the rate. Explain what that means. So that means that basically you're gonna buy a home. Think about it. If you bought a home, I don't know, I can't even keep track of the days and the years anymore, a year and a half ago when rates were eight percent, okay? And you paid five hundred thousand dollars for that house. Okay. And this is why I tell everybody too, you can't refinance your purchase price either. And everybody's like, what do you mean when you say that? Well, if you bought a home two years ago and you were paying eight percent, right? Okay. And you you spend $500,000 on it.

Speaker 2 31:29

Yeah.

Policy Shifts, Affordability, And Resources

Speaker 31:29

And here we are, rates are sitting in the low sixes. Right. Well, guess what? That $500,000 home today is going to cost you more today, because now there's that many more buyers in the market. Inventory is still light. And as rates go down, uh home prices are gonna go up. So whether you buy a home for $500,000 and you bought 8%, or now you waited because you wanted rates to come down, guess what? Now that rate's come down from 8% to six and a quarter, but that $500,000 home is probably $600,000. So you're paying for it one way or the other. Right. When I say you can't refinance your purchase price, if you bought that home at $800,000 and you could afford it and you were comfortable with it at 8%, right? Now you're like, great, this is amazing. Now I just knocked off three or four hundred bucks a month on my payment. Right. I sucked it up for a little while. But the most important thing is I tell people, I'm not here to convince you to buy a home today, buy a home tomorrow. I'm here to convince you to buy a home when the opportunity is right. Right. You know, at the end of the day, hopefully I come to you and say you're qualified to spend a lot more than you're comfortable spending. Right. And that's a wonderful position to be in. And when you buy a home, we think we're gonna refinance the mortgage, but you can't go into it expecting that. Hope for it. Everything you read on the headlines around the financial sector, it's his home push about home affordability, home affordability, home affordability. You know, you saw all these headlines, maybe you did or didn't, and I'm rambling and I'll shut up. But you know, Trump doesn't want, I did something on my social. He doesn't want these big bad investors coming in and being able to buy homes, right? Is that gonna help the mortgage market? No. Is that gonna help inventory where now you're not competing against somebody who's just buying the home to fix it and flip it, where you're buying the home to actually move into it and raise a family in it? Right. Like that's what he wants. Right. Um, he rolled out something on Friday. This now you can um write up to $40,000 off from a deduction instead of owning a home. That's a huge increase from what it's been, right? Huge. So now there's income requirements, right? Right. If you're making and I I it just got released on Friday, there's caps on income. Just like there's caps on income for home buying right now. If you in the city of Chicago are buying a home and don't quote me on this, if you make under $151,000, you actually get a better rate than somebody if you're a first-time home buyer.

Speaker 2 33:59

First-time home buyer.

Speaker 34:00

You get a better rate than somebody who's bought a home before and makes over that. Wow. And that's this whole push of get home ownership in because home ownership is the key to the economy, right? Like it's the single most biggest investment you're gonna make typically in your life. And so there's lots of things going on. And listen, it's it's day to day, it's hour to hour, it's week to week, it's month to month, right? It's year to year. Yes. But you know, follow him on Instagram, follow me on Instagram.

Speaker 1 34:31

Wait, how do we find we find him at Ben at rate.com. That's my email. Ben ConeLens.com. You've got uh no, well, just Ben CohenLens on Instagram. I don't think there's a dot com on Instagram. I'm gonna tell you, you you have a website. I'm oh no, I do have a website, yeah. BenconLens.com. Yeah, there we go. There we go. Introducing him to his own website. He's on there, it's the same guy. Um, but yeah, type in Ben Cone, you'll find him everywhere. Um, he's a great follow, tons of content on there. I'm so glad he joined us today. Um, he'll be on again. We'll tell you how he did in our golf tournament this summer. Hopefully, we make it past the second round.

Speaker 35:08

Well, well, there should be a trophy next time we do this. Yes, agreed. The trophy will be right here there. Well, it's got it. I think it's like this big.

Speaker 1 35:15

So it's fine. We're gonna have to have to move these shelves up. But thanks for coming. Thanks, Bonnie. You're the best. I hope it was helpful and educational. I think it was very educational, very helpful. Tune in to us next time. Thanks for joining us.