October Playbook

After rounds of fast-paced meetings at Future Proof, voices were growing hoarse and exhaustion was setting in. It was day two, and I was feeling the effects of back-to-back conversations. Then I met Maggie.

There was something different about her—she had a presence, a charisma that went beyond the usual business talk. Maggie had a passion for her clients that was undeniable. But more than that, she was real. No pretense, no speaking in polished clichés depending on who was across the table. Whether it was friends, colleagues, or clients, Maggie treated everyone as an equal. Her authenticity flowed into every interaction, and that energy gave me my second wind.

Meeting her was a reminder: We all have a voice, and the most genuine connections happen when we are true to ourselves. In this industry, it’s easy to fall into the habit of adjusting how we talk or act based on the person in front of us. But Maggie showed me again that real power comes from being yourself. That’s the person others want to see.

That encounter has stuck with me. It's a lesson I’ll carry forward into how I work with financial advisors and clients. I’ll keep my voice strong and true to myself as I share our story and mission at Wealth Lending Group and Leveridge—because that’s how real connections are made.

In today’s email…

• The Refinance Wave: Are Your Clients at Risk?

• Fed Signals Could Rock Your Clients’ Portfolios

• Protect Your Clients: A Real Estate Asset Case You Can’t Miss

Let’s dive in!

Industry Insight: Preparing for the Upcoming Refinance Boom

A surge in refinancing activity is on the horizon as mortgage rates begin to dip from their recent highs. This has opened up opportunities for borrowers, and banks are expected to ramp up their lending in the coming months. Banks will start offering rate incentives tied to deposit and assets under management (AUM) brought over to the bank, with typical requirements starting at $250,000 and increasing from there. This presents both opportunities and risks for financial advisors and their clients.

What’s Driving the Refinance Boom?

As mortgage rates, which hit over 7% earlier this year, begin to ease slightly, applications for refinancing are increasing. In fact, refinance applications surged by 20% in recent weeks as rates for 30-year fixed mortgages dropped to just over 6%​. This trend is expected to continue as banks seek to attract new deposits through relationship incentives, offering reduced mortgage rates in exchange for transferring assets or deposits.

Potential Pitfalls for Advisors’ Clients

While refinancing can lead to significant savings, there are some risks to watch out for, particularly if banks push clients into products that don’t align with their long-term financial plans. For example:

Extending loan terms
Loan officers may refinance borrowers into a new 30-year mortgage, even if they are well into their original loan term. For someone who is already 8 years into their loan, this can increase the total interest paid over time.

Adjustable-rate mortgages (ARMs)
Some banks may offer 7/1 ARMs to reduce payments in the short term, but this can expose clients to future rate increases that may not align with their financial goals​.

The Role of Financial Advisors

Advisors play a crucial role in protecting clients from decisions that are based solely on short-term gains. Refinancing decisions should be part of a comprehensive financial plan. While a bank might offer attractive rates, advisors must ensure these products truly fit into the client’s broader strategy. Clients may be lured by the promise of better rates in exchange for bringing assets to the bank, but they need guidance on whether this benefits their overall portfolio or simply helps the bank’s bottom line​.

Actionable Steps

Evaluate the full financial picture
Before making any refinancing recommendations, consider how a new loan term or ARM could impact a client’s long-term wealth-building strategy.

Monitor bank promotions
Keep an eye on the relationship incentives banks are offering for bringing over deposits or assets. While the rate reductions may seem appealing, ensure they don’t compromise the client's financial flexibility​.

Educate clients
Help clients understand the potential risks of extending loan terms or locking into adjustable-rate products. Make sure they know how these choices align (or don't) with their financial goals.

This refinance wave could be a great opportunity, but it's essential that the right loan product matches the client’s needs. With banks eager to win business through rate incentives, it’s up to advisors to ensure clients aren’t making decisions that only benefit the lender.

Macro Outlook: Navigating Global Events and Fed Policy Shifts

The current economic landscape is being shaped by a convergence of geopolitical tensions, monetary policy developments, and market fluctuations, with advisors needing to stay informed and flexible.

Middle East Tensions and Market Impact

The conflict between Israel and Hezbollah is causing significant market volatility, particularly in oil prices. Escalating tensions in the region have pushed crude oil prices up by about 2%, reflecting concerns over potential disruptions to global energy supplies. While Israel and Hezbollah are not major drivers of global economic activity, the risk of wider regional involvement, particularly from oil-producing nations like Iran, could further pressure oil prices and inflation globally. However, the overall impact on U.S. markets remains muted so far​.

The Fed's Stance on Rate Cuts

Domestically, the Federal Reserve is closely monitoring inflation and labor market data as it weighs the possibility of future rate cuts. Fed Chair Jerome Powell has emphasized a cautious approach, signaling that while inflation is slowly easing, the Fed is not in a rush to cut rates drastically. However, analysts suggest that if labor market data softens, we could see a 50-basis-point rate cut as early as November​.

With inflation still hovering above the Fed’s 2% target, this week’s job numbers will play a pivotal role. If employment growth slows, it could push the Fed to act sooner. For now, the U.S. economy remains resilient, with unemployment steady at around 4%, but the next few months are critical​.

Bond Market Reactions

In the bond market, yields have been fluctuating in response to these uncertainties. The 10-year U.S. Treasury yield recently hovered around 3.74%, reflecting a mix of investor caution amid geopolitical risks and expectations of a possible rate cut. Despite the volatility, U.S. bonds have seen five consecutive months of gains as investors continue to view them as a safe haven​.

Key Data to Watch

This week’s economic calendar is packed with important updates, including the September jobs report and ISM manufacturing data. These will be crucial in shaping the Fed’s rate decisions and could lead to market swings. Advisors should keep an eye on how these numbers align with the Fed’s cautious approach​.

With geopolitical tensions simmering and the Fed walking a fine line between inflation control and rate cuts, advisors need to stay alert to shifts in both global and domestic markets. Keeping a close watch on labor market data and bond yields will be essential in the coming weeks.

Client Success Story: Asset Protection for a C-Suite Executive

The Client

A C-Suite executive at a Fortune 500 company was introduced to Wealth Lending Group by their financial advisor while planning the acquisition of a $3.8 million, 4-unit investment property in Los Angeles.

The Challenge

The client owned multiple properties but lacked a comprehensive asset protection strategy. All properties were held under the client’s living trust, exposing them to significant liability risks that could impact their personal finances and other assets.

The Solution

Wealth Lending Group, in collaboration with the financial advisor, identified the risk associated with holding all the client’s properties under their living trust. To address this, we recommended the establishment of three separate LLCs—each owned by the client’s living trust. These LLCs were created to cover their two existing properties, as well as the new $3.8 million property. This solution provided a strong legal framework to shield the client’s assets from potential lawsuits and liability.

The Outcome

Robust Asset Protection
By restructuring the ownership under LLCs, the client significantly reduced personal liability exposure.

Increased Security for Future Investments
The new acquisition was fully protected under the newly established LLC structure, ensuring future property investments were secure.

Strategic Financial Positioning
The client’s assets were now better protected, offering peace of mind and financial stability.

Long-term Benefits

Enhanced Risk Mitigation
The new structure greatly minimized potential liabilities, safeguarding the client’s wealth and ensuring long-term protection.

Strengthened Client-Advisor Relationship
By delivering a tailored asset protection strategy, the financial advisor reinforced their role as a key financial consultant, maintaining AUM and fostering trust.

Strategic Positioning for Future Growth
The successful implementation of the LLC structure positioned both the advisor and the client for future financial opportunities.

The Advisor's Perspective

For the financial advisor, this collaboration with Wealth Lending Group not only protected the client’s assets but also enhanced their credibility as a trusted financial consultant. By offering a solution that addressed both immediate and long-term risks, the advisor was able to maintain AUM while demonstrating a commitment to their client’s financial well-being. This success story strengthened the relationship and set the stage for future advisory opportunities.