Yes, Mortgage Influencers Exist- Here's Their Top Financial Advice

A study suggests that Gen Z has it better in the housing market than the millennials who came before them.

Originally seen on nypost.com

TikTok is synonymous with singing, dancing, skits, and now—mortgages.

Some of the 170 million U.S. users of the popular social media app are also homebuyers in need of loans. Like so many other people in search of a quick hit of entertainment with a dash of needed information, they are turning to the mortgage influencers of TikTok.

For example, in one TikTok video, a man says, “If you’re thinking of buying a house in 2024, you need to pay attention to interest rates.”

The speaker, a loan officer who goes by the handle @buynotrentguy, has hundreds of videos that cover all kinds of mortgage and finance advice, from setting up a trust for a house to buying a home with a parent.

He’s just one of many “mortgage influencers” on the platform dishing out advice. But is the advice sound?

To answer that, we combed TikTok to find the best mortgage videos on the platform and asked mortgage professionals to weigh in.

What the pros think about TikTok advice

Jerry Devlin of Assume Loans, a company in Brookline, MA, says that many TikTok videos can be helpful in explaining some of the “do’s and don’ts” of buying a home.

“It is particularly helpful reaching a younger, first-time homebuyer market that might otherwise think buying a home is out of reach,” he says.

However, Devlin notes that not all videos are helpful or accurate.

“I particularly do not like those that ‘predict’ where rates or home prices are going. Those, in my opinion, are irresponsible,” adds Devlin.

Richard Redmond, a mortgage broker and author of “Mortgages: The Insider’s Guide,” adds that social media videos shouldn’t be a buyer’s only source of mortgage information.

“Buying a home is probably the biggest purchase a person will make in their life, and how it is financed may be the most important financial decision most people will make,” says Redmond. “It is worth spending some time to get educated enough to make an informed choice about getting a mortgage.”

Buyers should talk to at least two lenders, ideally a mortgage broker and a banker, Redmond adds. These experts should be “experienced, referred by trusted sources, and have great online reviews.”

So, while TikTok videos shouldn’t be the beginning and end of your financial education, they can be a quick, accessible, and even fun way to prepare yourself for homebuying.

Here are some notable TikTok videos to check out.

1. For buyers who think mortgage terms sound like gibberish

In this clip, Texas mortgage lender @thatlenderbecca makes a point of saying that many buyers don’t understand some of her industry’s technical terms.

She speaks to the camera while gibberish language plays over her words.

“What my clients hear when I forget they don’t speak mortgage,” reads the text.

If you don’t know what a basis point or a jumbo mortgage is, this is a good reminder for buyers to familiarize themselves with at least some key terms. Here’s a helpful guide.

2. For buyers curious about the future of mortgage rates

Another video discusses inflation and rates after a recent Federal Open Market Committee meeting, in which the Federal Reserve decided to keep the short-term policy rate steady at a range of 5.25% to 5.5%.

“While the news wasn’t great for homebuyers,” the video states, referring to the rates staying the same, “it could’ve been worse.”

Devlin says that this poster, @thatmortgageguy, a mortgage banker with hundreds of videos and more than 800,000 followers, is “one of the biggest influencers in this space.”

He adds that @thatmortgageguy reports mortgage-related news while educating. It’s a good account for easy-to-digest updates on the housing world.

3. For buyers who have rate concerns

Speaking of rates, @buynotrentguy recently posted a video about whether home shoppers should wait for rates to go down or brave the market while rates are relatively high. He encourages buyers not to delay, saying that when rates eventually drop, home prices are likely to rise.

“People that buy now can sit in the house, wait for rates to drop,” he explains in the video. “As that happens, their home price will go up, they will actually gain equity during the period that they’re waiting. They can then refinance to the lower rate.”

What the pros say: Redmond says this is good advice—as long as rates actually drop.

“This is basically ‘marry the house, date the mortgage‘ advice,” he says, referring to a popular homebuying strategy.

Home shoppers shouldn’t depend on predictions, he adds. “Interest rates are notoriously difficult to predict. … You might as well use a Magic 8 Ball.”

He recommends a more careful strategy: “When you finance a home purchase, you should be confident that if interest rates do not drop, you will still be able to afford your mortgage.”

4. For buyers curious about whether a loan estimate is the final price

“Mortgage loan officers are getting pretty desperate,” @the.mortgage.mentor starts in one post.

The market is hard for everyone: buyers, agents, and even lenders, she says in the video. Some lenders are “pulling some pretty shady tactics” to get buyers to work with them and are “grossly underestimating” their loan estimate. (A loan estimate is just that, a document that estimates anticipated closing costs, monthly payments, and the interest rate, among other things.)

“Surprises are great, but not when it comes to buying a home,” she says. “You don’t want to have to show up to closing and, surprise, you have to pay $2,000 more.”

What our pros say: Redmond reminds buyers that @the.mortgage.mentor’s claim that loan officers are “desperate” is a generalization.

“Some are and some do lie, but most care too much about their online rep to make a habit of it,” he says. A good loan estimate was designed to protect consumers—and can be very valuable.

5. For buyers curious about how to show proof of funds

In one video, posted by a loan officer who goes by @loansenseiphatchau, a scene plays out from “The Office” in which one character repeatedly asks another, “Where?”

Over the clip, the text reads: “POV: Your loan officer asks where you keep your down payment.”

Below, the TikTok user explains that a buyer’s funds should be in checking or savings accounts, gift funds, or a 401(k)—but not in cash.

While it’s not mentioned in this video, it’s generally recommended that assets not be in mutual funds and stocks since this money can’t be withdrawn easily and the amount can change quickly based on market conditions.

Home shoppers will also need to submit a proof of funds letter showing they have enough to purchase a home when presenting an offer letter.

6. For buyers curious about how to pay off a mortgage early

Josie Luiz Morales, or @joseluizmorales805 on TikTok, is a real estate agent and investor from Ventura, CA, who posts about buying, selling, and finances.

In one video, he discusses paying off a 30-year mortgage in 15 years by increasing monthly payments.

“This is something the bank won’t tell you because they make more money off you,” he says in the video before explaining how homeowners could pay off their mortgage early by paying 15% more each month.

What our pro says: Redmond explains that owners can indeed pay off their mortgage early if they can afford to increase their monthly payments.

However, he says Morales’ claim that the banks “won’t tell you” this fact is “complete hogwash.”

“Almost all residential loans are securitized and aren’t held by a bank. Whoever originated your loan has zero interest or investment in whether or not you pay it off 15 years early,” Redmond explains.

In addition, he explains that when homeowners pay additional principal on a mortgage, it’s “the same thing as putting money in a savings account at the mortgage interest rate, so you need to be satisfied with that return.”

He notes that if a homeowner isn’t happy with their interest rate, they could potentially be better off using that extra cash for another, more lucrative investment.