Equity Unlock – Can a Second Mortgage Help You Recycle Capital When 1st Mortgage is Sub 4%?

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good morning good afternoon good evening

folks Michael Zuber won rental at a time

back with the boys from Convoy Jonathan

and Dustin are my favorite Justin how

you guys doing good how are you I’m

doing very well very well so uh we’ve

been teasing a program that you two have

been working ridiculously hard on uh

last week you know we got close we

thought we’d have it on the first we got

it on the third and I’m calling this

thing the equity unlock

wow that’s what I think this is going to

be for folks let me paint the picture

and why I think it’s Equity unlocked

so as we all know for the last couple of

years we’ve

we’ve had a couple of things first off

we’ve had the opportunity to purchase or

do refi’s sub four percent

some people sub three

uh that is now a first mortgage that is

an asset for most people for the rest of

their life that first that first is not

getting paid off

however we’ve also seen amazing


and there’s a lot of people that like

doing what I do which is called

recycling Capital let me go back to my

asset let me pull a big chunk off let me

go and use that to buy another asset I’m

not talking about buying toys I’m

talking about buying assets however

there’s a ton of people stuck you and I

talked probably six months ago and I

said pretty Point Blank trying to push

you and prod you whoever figures out the

second Equity unlock is gonna win

uh you guys took the ball you’ve you’ve

put the legwork in you now have a

program so tell us about Equity unlock

uh it is a second uh but it is um it’s

something everybody lots of people are

going to look at because it’s a great

way to recycle Capital so what do you

guys got

yeah it’s it’s a uh it’s a second

mortgage where the homeowner or the

investor does not have to refinance

their their first mortgage at a super

low rate that they probably have

um and they can take cash out by just

getting a a whole new second loan on top

of the you know first loan that they

have and what’s unique is you know it is

available for not only owner occupied

properties but secondary homes and

investment properties and um you know

the ability to qualify

is a lot easier than what we have seen

in the past for just your traditional

kind of home equity line of credit where

you had to have two years of tax return

W-2s all that stuff we call it full dock

this is more of an ALT doc approach

where we’re doing

if yourself and you can go 12 months of

bank statements well just look at your

deposits call it today

um or you know if you’re not

self-employed great

we’ll do a one year worth of full dock

rather than a few years given that

obviously the job market in the economy

has been a little bit better in the last

12 months than looking at the last 24

months yeah makes sense yeah and then um

another big thing is obviously being

able to just use bank statements for 12

months like Dustin said

um on on self-employed borrowers so to

clarify it’s self-employed right so what

that means is you’re not it’s not like

rental business that you’re running that

you’re just collecting rents on and then

claiming it as self-employed it’s like

actual business income

um but so it’s huge to unlock for a lot

of business owners and a lot of

self-employed people which is I think a

lot of people that invest as well

um you know being self-employed and it

allows them to kind of tap into their

Equity without kind of doing the refi or

the whole song and dance the only caveat

right now and you know it’s kind of a

big one because we’ve you know a lot of

our clients that have been using this

program right now have been California


um is the minimum loan amount is 250 250

  1. ah okay well there’s so again

that’s the minimum second yeah minimum

second loan amount is 250 000. now do

you imagine that might evolve and change

over time or do you think the buyers

kind of want to stay at that level

we we’re definitely asking and prodding

and working on trying to get it lowered

even if it was at 200 or 150 would be


um but the 250 Mark obviously makes it

kind of a hard barrier to entry for of

clients in you know the Midwest or some

states that 250s basically might be the

value of their house right right no

exactly yeah yeah so but so for our

California clients it’s been obviously

really popular because it’s you know

they have multi-million dollar homes or

they have a million dollar like or 1.5

million dollar four unit that they have

a hundred thousand dollar loan on this

is a great way for them to cash out

um 250 500 000 to be able to invest

something else but for the clients that

have you know 250 000 house or even a

500 000 house just kind of makes it a

little more difficult yeah yeah that’s

unfortunate that limit right because

that does take probably a decent portion

of the audience out that would like to

get Equity

um unlocked maybe it evolve over time I

think I think it will evolve over time

because this again this second Market as

I kind of talked about earlier is is

ripe for someone to figure out I think

you’re going to have to get that down to

probably 100K minimum or Mac yeah I

guess minimum to really kind of dominate

because that that opens up more of the

country I understand not wanting to do

it at 50k or whatever because just the

paperwork and it’s just it’s not worth

it but I think eventually the market

will will find a floor at 100K uh but so

let’s just kind of round out the program

this is residential is it fourplex is an

under or is it everything yeah it’s

fourplexes and under and then one other

thing that you know we’ve spoken about

it I don’t know maybe a month ago but we

are doing a lot of full doc seconds on

investment properties that are minimum

is at 125 000. oh so there you go so

you’re close yeah you’ve got a two-year

you know W-2 turn where your income

looks strong on paper we can do that

well we’ll go down to 125 but if you’re

looking for the alternative doc type

qualifying uh I see I see so so again

folks if you’re watching this the 250 is

really that kind of alternative you know

bank statement you know self-employed

but if you’re a W-2 owner you’re in Tech

or Finance or whatever and you have the

tax returns to back it up you can go

down to 125 so that’s that uh that that

is a ray of sunshine that makes me feel

better because I think there’s a lot

more people at that level so again

seconds are possible seconds are it just

makes a lot of sense right and again

there’s a lot of equity people have

people wanted recycle Capital if they’ve

heard my story I recycled Norris drive

after two and a half years and then I

think it was Ferris and Terrace next

um it’s just how you keep moving forward

it’s it’s if you just if you have to

just save up the down payment all the

time it’s slow so the ability to recycle

capital is powerful and seconds

uh again I think the FED broke housing

with rates for too low for too long the

answer is seconds

uh don’t buy toys don’t buy vacations

don’t buy stupid new cars buy assets

make sure they cash flow day one what

other things we can tell people

um is there like minimum credit or other

things we should be I want to you know

help people when they call you and reach

out they have some of the answers so so

the minimum FICO is going to be 680.


um I’d call that low but okay exactly


um you know if you’re going the kind of

the new Equity unlock program you’re


um 30-year fixed or 20 or 15 year


um but if you go 30 or fix you have the

alternate the option to do a 10-year

interest only with a 20-year fully M

um that’s pretty cool on a like second

loan that you can do Jonathan sorry to

interrupt but let’s just say you got

into Home Three could you do like a 27


if somebody wanted to match their first

with their second term could you do that

or is that just too much work no it’s uh

the kind of special year pricing that

like you know some lenders do is is okay

that’s fine I just wanted to ask so it’s

15 10 15 20 30. normal so I I would do

my what I would do in this situation if

it was me as I would get my second uh to

be paid off before my first so in my

example if you had 27 years I would get

a 20. if you had you know 16 years left

I’d get a 15.

um I would want this again you don’t

have to do that I’m just sharing with

the audience what I would do it makes

sense yeah absolutely and then again

like I said like Dustin said if we have

that if you’re using that second loan

um that we can do for

full dock clients

um then you know I think with that one

we can go up to I think 90 right on the

loan to value yeah up to 90. and then

like like it made me think uh because

John and I are running the numbers too

on this like the shorter the term on the

full dock you’re obviously gonna get a

better rate there you go you’re seeing

if you went up to like 90 uh on a

15-year second

the payment’s actually less than a 90 on

a 30-year think about that folks yeah

that’s just noticeable yeah I mean just

you know reaching out to us and letting

us just run the numbers and pointing out

to you that you know we had we had

multiple guys come to us saying they

just want 30 30 I’m like look let me

just show you something yeah let me just

show you the number the payment’s less

go with the 15. yeah let me tell you

folks if the payment’s Less on a 15 then

they’re 30.

yeah exactly whatever the whatever

payment is less but

um you know it really does allow for a

lot of clients now to you know have

flexibility on what they want to do with

the equity right that’s the most

important thing right yes the program is

250 it may be you know too high very of

entry for a lot of clients but you know

it’s a work in progress It’s new

um it’s two days old exactly okay I’ll

start picking on you in two weeks I’ll

give you two weeks yeah it’s it’s um

it’s it’s coming out it’s you know and

it’s very popular with specific targeted


um not for everybody just like any loan

right it’s not always for everybody so

um you know we it’s really allows you to

to tap in if you have that Equity if you

don’t you know reach out to us about

that second loan that is full dock


um so you’re gonna have to qualify based

on you know tax return income you know

what you know what I’m gonna ask my

audience to do is if you are interested

in this Equity unlock I would tell you

to reach out to Convoy today this


just to let them know how much activity

is out there that way when they go to

Wall Street and they talk about hey we

we have all these other folks that we

could help I think that’s a that’s a way

for them to kind of use real information

so how do you want people to reach out

whether they’re interested in the 250 or

the 125 or just want you know to talk

about seconds how do they do that uh

feel free to email Private Client at

convoyhomeloans.com and then Dustin and

myself will uh we’ll reach out to you

awesome let them know you came from one

rental at a time that’s the deal they

will uh they will interact with you so

thanks guys thank you

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