Mike Meena of Augusta Financial on Rates, Condos, and the Crash That Is Not Coming

Episode 01. One hour and seven minutes, unscripted. Watch on YouTube · listen on the podcast feed.

This is the first episode of the resurrected Honor Roll Show, and Mike Meena took the seat before anyone else would. Twenty-something years of friendship, one long conversation, no script.

Mike runs Augusta Financial out of Santa Clarita. NMLS 241911. The office is at 25129 The Old Road, Suite 350, and the number is 661-260-2970, which I have had memorized for so long that I told him on air it is the number I would call if I ever got arrested in Mexico.

He is a banker and a broker, which matters more than most buyers know, and he answers his phone at nine at night, which matters even more.

Why does a Santa Clarita lender say the market is not going to crash?

This is the part of the conversation that stopped me. Mike's argument has nothing to do with optimism and everything to do with arithmetic.

More than half of the market is sitting on a mortgage under four percent. Those owners locked in during 2020 and 2021, they have been paying that note down for five and six years, and they are sitting on enormous equity. Ask yourself what would make that person cut their price.

They will not. They can hold. They can rent it out. They can pull a second and keep the low first in place. Mike calls it the golden handcuffs, and the handcuffs work both directions: they keep inventory off the market and they keep prices from breaking.

He also pointed out the thing nobody says out loud about our local buyer pool. A lot of the people we work with are public employees, first responders, nurses, trades. Their pay has climbed and keeps climbing. A cop who made a hundred and fifty a decade ago is making considerably more today with overtime. That is not the profile of a market about to hand back keys.

What does a mortgage payment actually cost you?

Mike's core complaint about the internet is that it hands people a payment with no context, and the payment scares them off before anyone explains what is inside it.

So he did it live. He took an eight hundred thousand dollar purchase, twenty percent down, and walked through it line by line: the mortgage interest, the property taxes, the principal that gets knocked off the balance every month, and a long term appreciation assumption. By the time he was finished, the payment that looked like fifty-one hundred a month looked like a very different number as a true cost of occupancy.

I am not going to reprint his math as a promise, and he would not want me to. Your bracket, your ability to itemize, your loan size, and current tax law all change the answer, and neither of us is your CPA. The point of the exercise is not the number. The point is that almost nobody sits a buyer down and does the exercise at all.

What do you say to a buyer who is waiting for rates to drop?

First, he asks a better question. Not are you ready to buy, but what is stopping you from buying right now, and then he keeps pulling that thread until the real objection falls out.

If the answer is the rate, he runs the math on where rates would actually have to land to hit the payment the buyer says they want, and usually that number is nowhere near reality. That is not a sales tactic. That is showing somebody the board.

Then he structures around it. A temporary buydown that lands the first year somewhere the buyer can live with, and a refinance later if the market gives one. Terms depend on the loan, the lender, and the day, so ask him what is actually available on yours.

And he is blunt about the alternative. Renting at three thousand a month in your fifties, with rent climbing every year, means paying more than double that by your eighties, with nothing at the end of it and somebody else's mortgage paid off.

Why are condo loans falling apart in escrow?

This is the most useful five minutes in the episode for anyone buying a condo in this valley.

After the Florida condo collapse, Fannie Mae tightened how it looks at complexes. Deferred maintenance, balcony work, insurance gaps, and thin reserves now decide whether a complex is warrantable, which decides whether a normal loan can be written on a unit inside it. Fannie has not reviewed every complex, so lenders are expected to review and report, and HOAs are expected to self-report.

The practical result: a buyer gets into escrow, the balcony repair or the insurance issue surfaces, and the loan dies. Mike's team pulls the complex the day the contract lands, checks its status, and calls the agents immediately.

There are lenders who will still do a non-warrantable complex. The trade is the down payment. The three percent and five percent down programs go away and you are looking at ten percent minimum.

Why do internet pre-approvals blow up?

Because a pre-approval issued in ninety seconds is a form, not an underwrite.

You tell the site you make two hundred grand and you have no debts, and it hands you a letter. Nobody asked whether you are self-employed, nobody read your tax returns, and nobody pulled title on the property you already own. Then you write offers, you get one accepted, and it detonates a week before closing.

Mike does the due diligence up front, which is why he says loans do not fall out on his side. He told a war story about a debt service loan that was ready to close until the underwriter found an old lien still recorded against a property the borrower had paid off four years earlier. One notarized document and a recording later, it closed. Nobody finds that in a ninety second pre-approval.

What zero-down and low-down programs actually exist?

• VA, at one hundred percent, for the people who earned it. Worth knowing that some credit unions farm VA loans out rather than fund them.
• USDA, which is rural and comes with income limits.
• CalHFA and other state and agency programs, which are real if you fit the box.
• Combination structures, like an FHA first with a small second, depending on what is available at the time.

He also gave the straight read on California Dream For All, the shared equity program everybody got excited about. It funded a few hundred families and turned into a lottery. Great program if you win it. Not a plan.

What is the worst mortgage advice out there right now?

Betting on the come. Assuming rates fall on your schedule. Assuming your income keeps climbing at the rate of the last two good months. Buying at the top of what an underwriter will approve instead of what you can actually carry.

His version: buy what you can afford, do not overbuy, and put money away. He is sixty-one and says his peak earning years are behind him, which is a strange and useful thing to hear from a guy still at his desk seven days a week.

Where does AI land on all of this?

Halfway through, Mike turned it around and asked me what AI is going to do to real estate. Fair question, since I teach it to brokers and agents and I build the systems.

My answer has not changed. AI is not replacing the agent. There is no version of this where software sits with a widow at two in the morning and helps her decide about the house her husband died in. Negotiation, showing property, reading a room, that is human work.

What AI does is make the humans dangerous. Read a contract and catch the box you missed. Pull the teeth out of a two hundred page CC and R packet or a solar lease. Handle the follow up that used to fall through the cracks, in your voice, so the hours you free up go back into phone calls with actual people.

Agents are not going to be replaced by AI. They are going to be replaced by the agent down the street who learned it. Mike said the same thing from the lending side, and admitted he is already using it in his marketing and would rather not say how much.

How to reach Mike Meena at Augusta Financial

Office: 661-260-2970. Augusta Financial, 25129 The Old Road, Suite 350, Santa Clarita, CA 91381. NMLS 241911. He answers when he is awake, which is most of the time.

Nothing in this post or this episode is tax, legal, or lending advice, and no rate, program, or term mentioned here is an offer. Rates and guidelines move. Talk to Mike about your file, and talk to your CPA about your taxes.