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Jackelyn Gallo
SVP Regional Manager, JD Bank
I find that borrowers are starting to have more realistic expectations on the finance side of our business. Most of our loan pricing is based on Wall Street Journal prime, which is a familiar term that business owners are comfortable discussing. It’s been my experience during conversations with borrowers that banks that have good credit-quality are pricing competitively in favor of qualified borrowers. In return, lenders are looking for borrowers to be strong, themselves, exhibiting that they can (and have) withstand the ebbs and flows of their industry during changing economic cycles, and have strong liquidity to withstand unforeseen storms in the future. As for creative financing, this can only be discovered when lender experience is combined with a clearly understood and well-thought-out business plan. An honest relationship between the banker and client becomes critical and must be established. Creativity is defined by understanding “sticking points” and working together to find reasonable solutions to satisfy both parties while mitigating risks associated with the request.
Karen Profita
Chief Executive Officer, Home Builders Association of Greater Baton Rouge
I love the old adage, “Date the rate, marry the house,” because rates can change. You can always go back and refi. But we’re not going to see those low-low rates again. I think people are really starting to understand that that was a very unusual market. Being realistic about it helps. We had so many people purchase houses during that time, and they’re going to wait probably five years or more before they’re ready to do another house anyway. So, I think some of the blame for the slowdown that we put on interest rates might not have been totally deserved. Locally and nationally, we’re seeing such an increase in remodeling because of that. A lot of people are choosing to go that direction. So, while the interest rate impact shakes out, it’s driving a whole new sector of the business for us at the same time.
Lance Faucheaux
Operations Manager, Level Homes
Buyers are definitely adjusting their expectations, but there’s still a fair amount of rate shock in the market. We continue to offer buy-down incentives, but at this point they’ve almost become more of an expectation than a true incentive. Buy-downs alone don’t seem to be enough anymore, and we’ve definitely had to get more creative in finding alternative ways to incentivize buyers and keep deals moving.
