Helping 137 families last year get into homes in a challenging environment, Sara Koelzer of Guaranteed Rate ended 2023 ranked number one in volume in Montana—in part due to the product offerings of her company Guaranteed Rate—along with her team’s speed, execution and exceptional pricing. A home purchase can be an overwhelming process for many, but Koelzer strives to make things simple and fun—and urges an early start, education and knowing your comfort zone.
We saw a 20-year historical high in rates in 2023. How did you manage to successfully navigate that environment?
Even though rates were high we used creative strategies like temporary rate buydowns to help buyers purchase with credits from the seller to assist with obtaining a lower rate. It really was a perfect combination for many buyers. As the home prices in Bozeman softened a bit, sellers were at a bit of a disadvantage, so they were willing to give more in concessions and our buyers were not forced to be competing in multiple offer situations. This tool allows the buyer to have a reduced rate over a period of typically two to three years with the opportunity to refinance at any point down the road.
What is the best way to prepare for the homebuying and lending journey?
I am really big on education for my clients. My motto is everyone gets an answer to help you become a homebuyer, no matter your credit score or current financial situation. We look thoroughly at each individual’s circumstance to give them specific advice based on their needs. Even if a client cannot purchase today we are advising steps in order to become a homebuyer in the future.
With that being said, I think there is a misconception out there that buyers today are just taught to “shop rate” and everyone is searching online today for the best deal. The internet is a wealth of information, but it also is very deceiving especially if you are first time homebuyer.
My advice is to choose a local lender based on referral and experience and work one-on-one with them. Start this well in advance of wanting to look at properties with an agent. The general rule of thumb is the concept of "two's". Have two years of tax returns, W2’s, paystubs and bank statements all prepared and ready for your lender to review. It’s so important to work with your lender to figure out your comfort zone of payment before you begin the home search, only to end up disappointed learning the home you love isn’t within your qualification range.
We know that you don’t have a crystal ball, but what are the predictions for this year?
We are expecting a gradual steady decline in rates. The primary factor for mortgage rates is ongoing improvement in inflation. Bozeman is such a desirable place to live and we have more activity than a large part of the country. When you add the demand to move to Bozeman coupled with lower rates, that in turn spurs more activity and multiple bid offers driving price as well. Regardless, higher inventory will be very healthy for the market and we do expect that inventory to increase this year.
What new tools does Guaranteed Rate have that would be useful for a homebuyer trying to prepare for the process?
Last year we launched a new “soft pull” credit feature that allows any of our homebuyers to apply online and initially we only do a soft credit pull. It gives the loan officer three credit scores from the bureaus accurately but there is no hard hit to your credit. It’s such a great way for many of my buyers who are not quite ready to make the full commitment to still apply and have me issue them a pre-approval. It’s been a game changer being able to offer this to all clients.
“There is so much more to a mortgage than just the rate—so you really need to align yourself with a seasoned professional who can guide and educate you with all of the best possible financial options available.”