Jason 's Blog

Get That Phone Ringing!

Mortgage Master Inc. — Wed, 30 Jul 2008 13:30:20 -0500

Get That Phone Ringing!

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Everyone knows that when the phone is ringing, business is good. However, how to get your phone to ring seems to be a popular question these days.

The fastest way to get your phone ringing is to contact your database! Many of the professionals asking this question have not been in regular contact with their database.

For example, we recently had one of our clients call us in a panic stating that he has seen a significant slow in his production, and wanted to know what he could do to get people contacting him again. We took a look at his records and noticed that he had not contacted his database of nearly 300 people in over a year! We immediately suggested that he send out a postcard to his entire database, discussing the recent rate cuts, as a way to get people calling again. In this way, he can make sure his database knows that he is indeed still around to help them.

It doesn't really even matter what you send, as long as you send something. There is no doubt that there is a lot happening in the mortgage and real estate industries, as well as the state of the U.S. economy as a whole. It is a great idea to send different messages each time to your database so they are always receiving something fresh from you - the keyword there is ALWAYS.

Now, more than ever, it is important to be in constant contact with your database! Show them you are still ready, willing and able to help them, still standing strong, and, most importantly, offer them peace of mind during these turbulent times that surround us.

Here are some ideas:

•· Offer Peace of Mind: Send a Turbulent Times Postcard to your entire database reassuring them that you are still the professional they can count on.

•· Send Value: Be sure to send things that people will want to keep, like Recipe Postcards, or Home Tips Postcards. People are likely to keep them around - thus keeping your contact information around too.

•· Give Them a Good Read: Newsletters are a great way to offer helpful advice and information regarding the things that are important to most people. Their home, their family and their finances.

Postcard mailings really work.
Here's what a few of our clients have had to say about mailing postcards:

"I was previously just doing a mailing on a quarterly basis and I got about 6-7 calls immediately after the mailing with a database of about 500. We figured if we are getting that every time we mailed a marketing piece then why not do it monthly? And numbers have consistently been about the same. Right now I have a database of about 825 and I get 8-12 calls from each mailing."
- Tim H., Coastal Mortgage

"A recent example of how effective the Auto Pilot Program is, last week I got a call from a first time homebuyer client from 2001. I am refinancing their loan and they are referring me to their best friends, who can't remember their loan agent's name! Thank you for the service and keep up the good work." - Sue B., Guarantee Mortgage

29 Low-Cost (even free) Marketing Ideas

Mortgage Master Inc. — Wed, 30 Jul 2008 13:28:22 -0500

29 Low-Cost (even free) Marketing Ideas

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Keeping in touch with your clients and staying visible in your community doesn't have to cost you a bundle. Take a look at some creative, inexpensive and even free ways you can keep your business growing.

•1. Send a Digital Newsletter each month packed with useful articles and tips for your clients.

•2. Write a personal email just checking in and send it to ALL of your clients.

•3. Email a piece of trivia to your database each month, and award the first person to respond with the correct answer a $25 gift card to a restaurant.

•4. Hand out free balloons in or outside of your office. Make sure your business card is attached!

•5. Partner up and cut your marketing costs in half. Choose your favorite professional referral source and send out a postcard together.

•6. Host a neighborhood picnic/potluck. Invite your neighborhood either over to your house or to a neighborhood park. Provide soda, water and some snacks. Tell them to invite a friend too!

•7. Conduct a survey of your clients. Ask them what they most need right now, what their biggest fears are, etc. Follow up with each based upon the results- you never know who may need your expertise.

•8. Email a motivational or inspirational quote of the day to your clients.

•9. Choose one person per day from your database and send them a hand written note card simply saying "hi."

•10. Start a blog. Write about personal and business related topics. Send an email reminder to your clients each week reminding them to read it!

•11. Write a "tip sheet" relating to your industry and email it to your clients.

•12. Host a free educational seminar and invite your favorite professional referral source to present with you.

•13. Contribute an article relating to your industry to your local publications. Become the ‘local expert.'

•14. Choose five people per week from your database (starting with your top tier) and send them a $5.00 Starbucks gift card and a handwritten note to see how they are doing. They may call you and invite you to have coffee with them and talk about their current needs.

•15. Keep a vase full of carnations or inexpensive flowers in your office with your business card attached to each one. Make sure everyone (even the delivery personnel) take one with them when they leave.

•16. Call your clients. Choose 3 people each day and call them just to say hello.

•17. Offer free "Lunch and Learns" to local businesses to talk about your industry, products and how you can help them.

•18. Contact local business owners and create a "discount package". You can send this to your database as well as the client lists of the business in which you partnered up with.

•19. Check with local schools (elementary, middle and high school) and see if you can contribute an article or offer a discount in the newsletter that is sent to parents.

•20. Sponsor a charitable event in your area and invite your database to participate with you for a good cause.

•21. Post a well written and benefit driven ad and offer a discount for your services on Craig's List.

•22. When you find any statistics or fun facts about your industry save them and compile a list and email it to your clients each week.

•23. Ask local businesses if you can place your business cards or brochures in their offices for their clients to take.

•24. Contact all Alumni associations of schools you have attended and tell them about your services or new company developments.

•25. Sponsor a local high school sports team and get an ad in the team program.

•26. Sponsor a float in a city or town parade.

•27. Get car magnets printed and sport it proudly on your car. You can even ask that your office mates do the same.

•28. Go to your local bookstore with a stack of business cards and place them inside of books that relate to your industry. Even better, write a personal message on the back of your card- "hope to hear from you soon."

•29. Celebrate a season in your neighborhood. For example: plant mini flags in neighborhood yards (with business card attached) in July or place mini-pumpkins on doorsteps (again, with business card) in October.

Teach Your Way to Success - With Homebuyer's Seminars

Mortgage Master Inc. — Wed, 30 Jul 2008 13:21:34 -0500

Teach Your Way to Success - With Homebuyer's Seminars

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Who says prospecting has to be painful? Why can't it be fun, fast and free? Holding educational seminars for your community, local corporations and non-profit groups can literally open the doors to a home for prospective buyers... and open the doors to new clients for you.

Here are ten tried and true tips to make your seminars successful!

•1. DETERMINE YOUR TARGET MARKET - Want to reach first time homebuyers? Market your seminar to newlyweds, parents-to-be and renters. Perhaps you want to reach subprime homebuyers? Hold a seminar on credit requirements and credit counseling. You may want to target your marketing to former bankruptcies and less than perfect credit individuals. Yearning for those "A" market homebuyers? Consider a seminar focused on investment property, tax implications of various mortgage products or on vacation homes. Target your market then market your target!

•2. TEAM UP FOR EFFECTIVENESS - When you team with another professional - be it another Realtor, a loan officer, financial planner, assessor or home inspector - you double your marketing effectiveness and make the presentation more interesting and valuable.

•3. OFFER AN INCENTIVE - It always helps to sweeten the pot... perhaps offer a coupon towards an appraisal, a free credit report, or even pizza.

•4. CAPTURE INFORMATION - Have attendees fill out a short form giving you an idea of what they are planning to buy and what their time table is. That way you'll know exactly when to contact them next, or whether to add them to your database for your regular client mailings.

•5. FIND FREE FACILITIES - Whether it be your office or another's conference room, a local library, church or community center, there are many avenues for finding free rooms for community enriching activities. A little research can save you loads of money.

•6. GET THE WORD OUT - Ads in local papers, group newsletters or bulletins can be very effective. Flyers are practically free, and press releases are free! Most papers and radio stations love to promote educational classes, especially when there is no charge to attend.

•7. DON'T WASTE YOUR MARKETING EFFORTS - Make sure to encourage a phone call or email even if people can't attend the seminar. Offer free educational booklets and encourage those interested to call you for them.

•8. OFFER FREE HANDOUTS - It's always a good idea to send people home with a little something to remember you by. It could be recipe postcards you've collected from your mailings, an amortization schedule, a brochure or your business card.

•9. SELL THE SIZZLE, NOT THE STEAK - Make sure to present your seminar as exciting and informative. Here are some sample titles: Homebuyer Secrets Every First Time Homebuyer Should Know, 15 Costliest Mistakes First Time Homebuyers Make... and How to Avoid Them, or Finding and Buying Your Perfect Home.

•10. DO IT REGULARLY - The real estate and mortgage professionals who are successful at seminars hold them on a regular basis. Be it monthly, weekly, or every other Tuesday, if people know you're having them, they'll refer others to them and come when it works into THEIR schedule. It may take a while to build a nice class size, but the effort and the wait will be worth it!

The Advantages of FHA Loans

Mortgage Master Inc. — Tue, 22 Jul 2008 12:34:20 -0500

The Advantages of FHA Loans

In many regions of the U.S., FHA loans have not been utilized for years, so a lot of real estate agents and mortgage originators aren't familiar with

this great resource. The following are a just a few of the recent changes that have made FHA loans a more attractive option again for some

consumers looking to buy a new home or refinance an existing one:

1) Congress passed the Stimulus Act of 2008.

During the recent housing boom, home values surpassed FHA loan limits in many regions of the

U.S. The recent enactment of this important legislation, however, increased FHA loan limits up to $729,500 in many high-cost regions of the U.S.

through the end of the year. FHA loan limits vary by county, so give us a call for loan limits in your area.

2) The FHA changed its appraisal and fee negotiating guidelines.

In the past, many sellers steered clear of FHA loans because the appraisals

were too strict and certain fees were non-negotiable. The FHA has greatly loosened these guidelines to make it easier for both buyers and sellers.

3) FHA loans are much cheaper now.

Because FHA loans are federally insured, they tend to trade at a higher premium in the secondary market.

This means lenders can often charge a lower rate.

Other FHA Benefits:

• FHA loans are not credit-score driven. Borrowers can have a lower score than other products and still qualify for a good rate.

• FHA loans require as little as 3% down.

FHA loans allow down-payment assistance programs. This allows the seller to cover the buyer's down payment and closing costs. This

means borrowers, especially first-time buyers, or move-up buyers with limited funds, have a real opportunity of getting into a home with

little or no cash at closing. For sellers, this means you can offer concessions that make marketing your home much more attractive

without having to lower the price of your home again.

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FHA loans allow a) Sellers to finance all of the buyer's costs to close; b) Homeowners to take cash out up to 95% of the home's value;

and c) Homeowners to consolidate a first and second loan up to 97% of the home's value.

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If you or someone you know is thinking about buying or refinancing a home, give us a call. We'll see if an FHA loan is right for your

financial goals and needs.

The Short Sale

Mortgage Master Inc. — Tue, 22 Jul 2008 12:32:52 -0500

The Short Sale

A Unique Selling Proposition for Real Estate Agents

While a short sale may be a last resort for many homeowners facing foreclosure, it

also represents a great opportunity for potential home buyers and real estate

investors. This article is designed to help answer a few basic questions about the

substantial risk and reward involved in this extremely complex and often drawn out

process.

What is a Short Sale?

A short sale is a legally-binding agreement to allow a home to be sold for less than

the amount that is owed. And, while short sales are not by any means common or

easy, because of increasing inventory levels and foreclosures in some parts of the

country, lenders are much more eager to negotiate with borrowers who are having

trouble paying their mortgages. For potential home buyers and real estate investors,

a short sale also offers a great opportunity to purchase property at a significant discount.

However, don't expect a lot of help from the lender without first providing a sales contract from a qualified buyer and all

the information required by the lender's loss mitigation department.

Of course, lenders are not looking to bail out "flippers" or other borrowers who simply overextended themselves. In most

cases, a borrower must have suffered a serious financial hardship that directly caused him or her to default on the

mortgage: the loss of a job, a serious illness, or the death of a loved one.

A written declaration and supporting documentation demonstrating financial hardship will definitely be required by the

lender. This may include pay stubs, tax returns, and liquid asset statements, among other documentation.

Key Considerations to Keep in Mind

It's important to note that the difference between what is owed on a mortgage and the final amount the lender collects

after the costs of the sale, including real estate commissions and possibly other charges don't simply disappear in a short

sale. In the past, this deficiency or "canceled mortgage debt" was considered taxable income to the borrower. However,

thanks to the Mortgage Forgiveness Act of 2007, the tax burden for qualifying canceled mortgage debt (as high as 35%)

for primary residences only has been temporarily waived until the end of 2009.

If there are multiple liens against the property, all lien holders will have to be involved in the negotiation process, not just

the first lien holder. Therefore, communication and patience are essential components of any short sale. This is why an

experienced real estate agent and mortgage professional become so valuable to this process.

FHA a proven leder in the mortgage industry

Mortgage Master Inc. — Sat, 10 Nov 2007 12:02:12 -0600

In observing the antagonistic relationship between real estate agents and loan originators throughout the years, I have come to the conclusion that it's mainly due to the fact that many loan officers or mortgage companies just throw out pre-approval or pre-qualification letters. They do this without properly analyzing the borrower's income, assets, and credit.

Real estate agents have every right to feel the way they do because of our industry's carelessness in putting out these pre-approval letters. This is a waste of people's time. Real estate agents are working late hours trying to put a sale together based on the letter that you have provided to your borrower. And then, thirty days down the road, the deal falls apart, and the real estate agent finds out that you didn't properly verify the information.

The other main reason that real estate agents really dislike loan officers is because they do not give true and accurate statuses on files. So if you just do these two things, which is provide a solid pre-approval letter and give proper and accurate statuses on the files, you're going to earn the respect of the agent you're working with in that transaction.

If you have pre-approved a customer, and there is a unique aspect to the structure of that transaction (for example, the borrower needs $5,000 in closing costs from the seller), make sure that you convey this to the agent who will be submitting that offer so that the contract can be drawn up correctly. Here's a tip that I've found great success with over the years in writing up pre-approval letters. At the bottom of your pre-approval letter, handwrite a note to the listing agent and seller to give them a sense of confidence that the transaction will close successfully.

If the loan is structured with a down-payment assistance program or a seller contribution, make sure that the real estate agent who is writing up the offer has this noted in the contract. As soon as that offer is accepted, your first call should be to the listing agent. Call them up and introduce yourself. Let them know that the loan is being processed in an efficient manner and that it will close on time, provided that everything goes according to plan. As soon as the real estate agents have that contract drawn up and fully executed by both parties, the ball is now in your court. It's your time to shine and show those real estate agents what you can do in processing the loan.

The most important thing you can do, to make yourself look good and rise above all the other loan officers out there, is to give weekly updates. Find out how the real estate agent would like to be updated, whether by fax, email, or voice mail messages. Note this in the file, and make sure that you provide an update once a week. It's a very easy way that you can set yourself apart from the service that other loan officers give.

If you have a bad experience with FHA loans is was more likely the loan officer you dealt with rather than the actually FHA loan or process. Working with an experience mortgage bank/loan officer FHA are rather easy and most of the time the best loan for the consumer. If you are working with a lender that does not utilize this product or has little knowledge you are doing a disadvantage to not only your success but to your clients financial future. FHA loans are typically much lower rates and less money down than conventional loans.

GOT FHA?

Why Choose FHA?

Mortgage Master Inc. — Sat, 10 Nov 2007 11:47:41 -0600

Why Choose FHA?

Before I answer the question "Why choose FHA as a Specialty", I'd like to give you a little background regarding how I came to do so. I remember my first week in the business about 7 years ago. The owner of another mortgage company came up to me and said, "Jason, if you want to remain in this business long-term, you need to know how to develop purchase business." Being new to the industry and scared of not being able to succeed, I really took those words to heart. Since that time I've always been focused on developing purchase business.

After about two and a half years in the industry, I became one of the leading government specialists for FHA loans. I spent the next two years developing myself in this niche in this area. After researching my market, I settled on FHA, and here are the reasons why.

The product has been in existence since 1934.
It has the lowest rates for fixed loan in the industry compared to conventional loans.
There are no credit scores. At this time, the government does not observe credit scoring. Although many lenders do put minimum limits on their credit scores, there are plenty of wholesale lenders out there that do traditional underwriting and don't observe credit scoring.
Use of alternative credit is allowed. It's possible to virtually build a credit history for people that have no trade lines showing up on their credit report, which we will explore in greater detail in another section.
100% of the money for the purchase can come from a gift, from a family member, or from the down-payment assistance program.
It's a purchase-based product. If you want to develop a purchase-based business, many of the first-time homebuyers out there are going to use FHA financing.
Six percent of the closing costs can come from a seller contribution, so you can be very flexible with the way you structure these purchase transactions.
The personal rewards that come with doing FHA loans are enormous. There's nothing more satisfying than taking a family that's renting and helping them become a homeowner. These customers often feel a great deal of gratitude to you for helping them achieve home ownership. As long as you keep your name in front of them, you're the first person they're going to contact in three to five years, when they go to buy their second home.
Lastly, and perhaps most importantly, you should consider specializing in FHA loans because of the increased income you're going to gain. Take a $135,000 loan for example. On an FHA purchase, with the 4 on the back and the 1 in the front, you're going to earn about $3000 on a 45% commission split. On a conventional loan, you'll maybe make 1.25% and earn $750. On a non-conforming loan, you'll maybe earn 3% which will give you $1800. So FHA has a tremendous ability to boost your income. And because it's one of the largest segments out there in the purchase market, as Greg Frost notes in the introduction to his home buyer seminar booklet, it represents 40 to 50 percent of the purchase market.
With the subprime market gone this is becoming popular again, most local small brokers do not have the ability, knowledge and the resources to lend on FHA loans and this narrows the competition down to lenders and give me a niche in a tough market place.
With a lot of foreclosed homes on the market the average home needs over $5,000 in repairs, this is a perfect fit for a listing agent to team up with an experience mortgage banker to offer FHA 203k REHAB loan to move a home that has just been sitting on the market because the average consumer does not have $5,000 or more after downpayments and closing cost to repair any improvements these home need. Marketing a home in conjunction with financing that will allow them money at closing to repair the home set yourself and your listing apart from the other hundreds of homes just sitting on the market because it is in desperate need of repairs.

These are just some of the reasons you should consider choosing FHA loans as a niche for yourself.

Home Buyers Face Decisions that Affect Their Long-Term Financial Picture

Mortgage Master Inc. — Sat, 10 Nov 2007 11:27:41 -0600

Seek a Qualified Mortgage Banker to Ensure the Best Results

Home Buyers Face Decisions that Affect Their Long-Term Financial Picture

Taking the step into home ownership is one of the most important financial decisions a person will make in their lifetime. There are many factors to consider when embarking on this venture. Literally hundreds of loan programs are available, and it is important to find the one that best fits your personal long-term goals.

First and foremost, you must have a mortgage consultant in your corner that is willing to take the time to know what your long-term goals are. Communication is the key factor here.

Curious prospective home buyers sometimes turn to Internet-based services just to see what current interest rates are. But a faceless web site will not take the prospect's future financial planning into consideration or guide the potential borrower through the many nuances of the loan process. When shopping for a home loan, be wary of web-based services that offer programs to reel prospects in with attractive rates that are based upon unrealistic time frames.

If a lender is offering a terrific rate based on a 10-day lock-in period, it is unlikely that the potential home owner would actually be able to find their dream home, get through the negotiation process and win approval from a lender within such a short period of time. This is called short-pricing, and when it comes time to close the transaction, the rate that was originally offered is simply no longer available. As a result, the unfortunate prospect is bulldozed into a loan program with a higher interest rate.

It is highly unlikely that a qualified loan originator whose business is based upon referrals will use unscrupulous tactics such as this to get new customers in the door!

Once you have found a mortgage consultant that you feel comfortable working with, lay your goals out on the table because it will have a tremendous impact on choosing a loan program that meets your specific needs. One of the most important factors to consider is how long you wish to borrow the money for. For example, if you know you will only be in the home for five years, it wouldn't make sense to opt for a 30-year loan program or pay points up front to secure a lower interest rate. You would not be in the home long enough to benefit from such action.

Your mortgage consultant should be able to narrow down a selection of programs based on the information that you have provided, and present you with an easy-to-read spreadsheet that clearly defines viable options for your interest rate and amortization schedule, monthly payment and any potential savings you may realize by paying points up front.

Moreover, a reputable loan originator will not hesitate to share this information with your tax consultant or financial planner so they may offer additional feedback on your behalf.

Home ownership imparts a rewarding vehicle for building wealth and a strong financial future. The mortgage consultant that you choose should be there not only when your loan closes, but should also provide you with ongoing service to assist you in managing that debt over time.

More than likely, this is one of the largest and most important financial transactions you will ever make. You might do this only four or five times in your entire life...but we do this every single day. It's your home and your future. It's our profession and our passion . We're ready to work for your best interest.

The Truth About the Mortgage Market

Mortgage Master Inc. — Wed, 26 Sep 2007 09:39:04 -0500

The Truth About the Mortgage Market

Subprime mortgages have now been credited for bankrupting well over 110 lenders and seriously damaging operations at many major mortgage firms. They've reportedly wiped out 5 hedge funds, tens of thousands of jobs, and have led to millions of foreclosures with millions more on the way. And, as if that weren't enough, subprime mortgages are also blamed for massive volatility in the stock, bond, credit, futures, and real estate markets here in the US and around the globe. Some say losses in the mortgage securities market alone could reach hundreds of billions of dollars this year.

This means that, for any Americans looking to buy, sell, or refinance a home, they are confronting a very different market from the one that existed just 6-12 months ago.

How did this happen?
The recent real estate boom was fueled by a period of record home appreciation and historically low interest rates. Banks, in order to compete, loosened guidelines and began offering more funding to more borrowers through riskier, non-conforming or "exotic" mortgages.

These ideal lending conditions persisted for several years, supported by high demand, historical real estate data, home prices, and massive trading volume/profits on mortgage-backed securities and other financial instruments on Wall Street.

Then, in 2006, a slowdown in real estate led to a deterioration of home values, an increase in inventories, and ultimately to today's tightening of credit guidelines, leaving many investors unable to sell or refinance out of their existing positions. Many Americans who had tapped into their equity were suddenly tapped-out and overextended as home values fell. Foreclosures followed in record numbers and a re-valuation of mortgage bonds and other financial instruments created the credit/liquidity domino effect we're now experiencing.

Unfortunately, it's going to get a lot worse before it gets better. According to the latest estimates, over 2 million subprime and Alt-A adjustable rate mortgage (ARM) holders will face payment increases of up to 30%-100% when their loans reset in the next 2 to 18 months. These loans make up less than 40% of the total mortgage market, but the negative effects, as we have seen, of increased foreclosure activity can have a ripple effect throughout the industry and around the globe.

What does this mean to you and your mortgage?

Sellers: If you're planning on selling your home, be prepared for an even smaller pool of qualified buyers. While some experts predict a settling of this credit crisis over the coming year, tightened credit guidelines and diminishing mortgage products could knock out as many as 15%-30% of potential qualified buyers. Now is not the time to sit and wait for the best possible price. Have a serious talk with your real estate agent. Having experienced buying/selling transactions in your area, he or she can help you price your home accordingly. He or she can also help ensure that your buyers are pre-approved and stay pre-approved throughout the entire transaction.

Buyers: Get pre-approved by your mortgage professional. While there are a lot of great deals out there, getting credit is becoming tougher and tougher, and it's taking longer and longer to complete a transaction. Remember, what you qualify for today could change tomorrow in a volatile market. For those looking to refinance, keep this in mind. There is no time to delay! Communicate with your lender. Don't do anything that could negatively affect your credit, and make sure you get all your documentation in on time.

ARMs Borrowers: If your ARM is scheduled to reset in the next 2-18 months, you need to schedule an appointment with a mortgage professional right away. Whether your ARM is subprime, Alt-A, or even if you have a pre-payment penalty, don't let a default or foreclosure situation sneak up on you. Did you know that your monthly payments can increase anywhere from 30% to 100% once your loan resets? At the very least, give yourself the peace of mind of knowing what your adjusted payment will be.

Borrowers with less-than-perfect credit: Each week it seems lenders are shedding more and more mortgage products. Many lenders have stopped offering No-Doc loans and are reducing all forms of Stated-Income loans. While it might be challenging, borrowers with credit issues need to see a loan expert. Often they have credit repair resources and other strategies to help you reach your financial goals.

Finally, there's an important concept to embrace: all markets, while cyclical in nature, are self-correcting, be it credit, real estate, stocks, or bonds. For the last 6 or 7 years, real estate was booming and riding high. The correction we're experiencing now - while it seems harsh and could get much worse - is, in a sense, "natural" and directly related to the extremely loose guidelines and perhaps overzealous lending and leveraging during the boom cycle.

Is your Lender in Trouble? How Realtors can Navigate the Crisis

Mortgage Master Inc. — Thu, 06 Sep 2007 12:51:39 -0500

Is your Lender in Trouble? How Realtors can Navigate this Crisis

With some of these big lenders in trouble could mean we are in trouble. I saw this coming back in 2006 and didn't think it would manifest itself this bad until late 2008. I forgot that in the information age, bad news travels in nanoseconds. A crisis, which took 18-36 month two decades ago, is compressed into 18-36 days in the information age.

Four Steps You Can Take Today To Protect a Disruption of Business:

1- Use mortgage brokers or mortgage bankers with access to different correspondent lenders: ask them to lock with two different lenders - that means no conduits. If they don't know what conduits are, move on.

2- Pick originators who know what moves the mortgage market and rates - see of they have access to live mortgage bond pricing. If the originator replies that the Fed moves rates or that treasury bonds move rates, or doesn't have access to live mortgage bond quotes, move on. Make those that claim they have access to live mortgage bond quotes prove it to you.

3- Focus on full documentation buyers. Insist on seeing the DO or LP findings from the broker or banker if you represent a buyer or seller.

4- Have a last resort back up plan and come up with a other means of financing Be prepared for programs days before closing be discontinued, lenders days before closing or funding the mortgage halt everything. If you do not prepare for the worse then you will be left with a borrower that can not close and a seller that can not sell. Luckily for the true mortgage professionals out there this mortgage crunch should flood them our of our industry. Too many times I have to hear of horror stories of bait and switch, loans not properly prepared and getting declined days before closing, being lied too and the over stating of income on loans that borrowers should not have been in to begin with.

I am not putting down big lenders, I am just stating a fact that right now it seems the bigger the lender the higher the risk and with higher risk the harder they are falling. I have friends that work for big lenders and they are worried day to day if they still have a job. I hope we do not see anymore lenders go under, this would be nice but something tells me this will get worse before it get's better.

Loans programs that are safe today are government FHA and VA, Fannie Mae and Freddie Mac loans. Anything outside of this subprime or even ALT-A is high risk to guidelines changes with out warning.

If you are working with a client and your approval letter is older than a week, demand a new one. Last thing you or your buyer wants to do is get an offer accepted on a new home and find out after some program changes they do not qualify.

This is a crisis. Your business doesn't have to suffer if you take the correct actions.

Déjà vu

Mortgage Master Inc. — Mon, 03 Sep 2007 11:05:05 -0500

Over the last five to six years, I've seen a gradual decline in the loan officer's ability to effectively write, close and process FHA loans. I attribute this to two main reasons, the first being a lack of proper training. I've found that the average mortgage company does not employ an individual who has enough knowledge of FHA loans to effectively teach others or the managers themselves have little knowledge about FHA.

The second reason is the massive amount of lenders that "where" lending high LTV sub-prime products. There where hundreds of companies that can close 100% loans with 6% seller contributions, all with a 580 credit score. Now that the smoke is clear and lenders have taken a bath will bad loans, FHA has not changed their guidelines and is now becoming the first stop for many seasoned mortgage bankers.

Let's take a closer look at some of the reasons why FHA loans are a great niche for you, your company, buyers and sellers.

FHA loans are not credit-score driven. Although many wholesale lenders have minimum credit scores, many do not. They traditionally underwrite the file, according to FHA guidelines. FHA loans also allow you to use alternative credit. Monthly obligations like gas, electric, and cell phone bills-wherever money's going on a monthly basis-as long as you can document it, it's possible to essentially build a credit history for applicants.

Another feature of FHA loans is that all funds can come from a gift, either from a family member, through the seller, or from a down-payment assistance program. Moreover, it's permissible to have a six percent seller contribution on top of the gift funds.

Customer loyalty is especially significant when it comes to FHA loans. The FHA product is a very stable one for customers, and they're very happy to have that type of loan. This means that they will gladly refer you to their friends who are also going to be buying a home, providing you with a higher percentage of repeat business.

The number one reason why most loan officers don't write FHA loans is because they haven't been given the proper training, and therefore they don't have the confidence to successfully attack this market. The second would be that they work for a small broker or lender and they do not have the resources or funds to get FHA approved.

Why is FHA loans a must have for any company that is going to succeed in this market?

Why is important for Realtors to make certain that their "Preferred Mortgage Banker" have knowledge and ability to close and fund FHA loans?

Simple answer is that this market is changing almost every hour, for some the market is going to a market that is very different from the market they started with. For seasoned veterans we are just coming back to a “normal market” or back to a market similar to one before the huge increase in SUB-PRIME and ALT-A lenders or some would call it the “REFI BOOM”. For those that came into the industry prior to this boom we are just coming back to a normal market for those not, the adjustment will be a harder one.

So what was it like then? First off FHA loans where the first option for mortgage professions, because of the low down payment, flexible credit terms, etc. Although FHA loans were first option for most they still had their limitations. No chipping paint, 3% down, smaller loan limits........(you all know what I mean)

Once sub-prime lenders hit the market FHA saw their market share decrease each year. FHA wanted to compete for that market and due to that they have became less restrictive over they years in many ways. In fact most people the get an FHA loan today can do so with almost no money out of their pocket.

I remember my first week in the business about 10 years ago. Being new to the industry and scared of not being able to succeed, I learned FHA loans and I've always been focused on developing my purchase business. Now with the turmoil in the Sub-prime and Alt-A programs FHA loans are coming back. Here are some highlights about FHA.

The product has been in existence since 1934.
It usually has the best fixed rates for 30 year and 15 year fixed mortgages.
There are no credit scores. At this time, the government does not observe credit scoring. Although many lenders do put minimum limits on their credit scores, there are plenty of wholesale lenders out there that do traditional underwriting and don't observe credit scoring.
Use of alternative credit is allowed. It's possible to virtually build a credit history for people that have no trade lines showing up on their credit report, which we will explore in greater detail in another section.
100% of the money for the purchase can come from a gift, from a family member, or from the down-payment assistance program.
It's a purchase-based product. If you want to develop a purchase-based business, many of the first-time home-buyers out there are going to use FHA financing.
Six percent of the closing costs can come from a seller contribution, so you can be very flexible with the way you structure these purchase transactions.
The personal rewards that come with doing FHA loans are enormous. There's nothing more satisfying than taking a family that's renting and helping them become a homeowner. These customers often feel a great deal of gratitude to you for helping them achieve home ownership. As long as you keep your name in front of them, you're the first person they're going to contact in three to five years, when they go to buy their second home.
Just like we seen a huge increase in loan officers, I have seen the same on a smaller scale with Realtors. With growth in the market we where just in many Realtors I worked with have little to no knowledge of FHA loans. For any mortgage banker, Realtor, loan officer or mortgage broker to not just "survive" in this market but to grow and prosper knowledge of FHA loans will be a key factor in determining your future in this market.
Everyday we are seeing lenders fold, go out of business, and take certain loan programs taken away (sometimes days before closing, or even worse during the funding). Not sure about you but I would feel a lot more comfortable know my client was closing an FHA loan instead of some special Sub-prime loan. This is make sense underwriting, or in my words "back to the basics

Lately I have been hearing people in our industry taking about what they are going to do to "survive in this market...blah...blah... I was recently talking to someone about this and asked them why they got into this business? Their answer was “It was the money and the financial freedom this industry give us.’ Since then I've told myself that I am not looking to just survive in this market, because just surviving doesn't sound like a too much fun for me. Rather than just surviving, I've make a commitment to myself to succeed in this market and with so much of my competition just looking to survive it looks like this should be pretty easy.

If you are a Realtor or a mortgage professional I would urge you to learn the in's and out's of FHA loans and position yourself to succeed in our normal market we are in.

www.federalhousingauthority.com/ - Unofficial FHA web site with a lot of good information.

http://www.hud.gov/buying/index.cfm Official site for FHA loans

The top 10 Credit Do's and Don'ts while buying new home

Mortgage Master Inc. — Mon, 03 Sep 2007 09:52:01 -0500

Keep in mind the most lenders will pull their own credit report at closing, and if your credit scores have dropped, you may no longer qualify for the rate that was underwritten and the final approval may come back with a higher rate. Unfortunately, all lenders qualify you by your credit score as to which criteria you fit and every loan has different criteria attached. The loan to value, the debt to ratio and so on etc. This is what borrowers do not understand, and they think the loan officer is baiting and switching. They are not. If an issue comes up that the lender decides you do not qualify for a certain loan, the only thing a loan officer can do is shop for lenders and see if any are willing to give the rate and program they thought you qualified for. If you have good credit and know your score, the loan officer can give you an idea what he or she can offer based on what you say. But do not expect them to stand by their quote if and when they pull your credit your scores have dropped.

Following are some helpful tips to avoid the credit mistakes that many borrowers make during the loan process:

•1. DON'T APPLY FOR NEW CREDIT OF ANY KIND. Including those "You have been pre-approved" credit card invitations that you receive in the mail. Every time that you have your credit pulled by a potential creditor or lender, you lose points from your credit score immediately. Depending on the elements in your current credit report, you could lose anywhere from 2-50 points for one hard inquiry.

•2. DON'T PAY OFF COLLECTIONS OR CHARGE OFFS during the loan process. Paying collections will decrease the credit score immediately due to the date of last activity becoming recent. If you want to pay off old accounts, do it through escrow, and make sure that 1) you validate that the debt is yours, and 2) that the creditor agrees to give you a letter of deletion.

•3. DON'T CLOSE CREDIT CARD ACCOUNTS. If you close a credit card account it will appear to the FICO that your debt ratio has gone up. Also, closing a card will affect other factors in the score such as length of credit history. If you have to close a credit card account, do it after closing, and make sure it is a more recent account.

•4. DON'T MAX OUT OR OVER CHARGE ON YOUR CREDIT CARD ACCOUNTS. This is the fastest way to bring your score down 50-100 points immediately. Try to keep your credit card balances below 30% of their available limit at all times during the loan process. If you decide to pay down balances, do it across the board. Meaning, make an extra payment on all of your cards at the same time.

•5. DON'T CONSOLIDATE YOUR DEBT ONTO 1 OR 2 CREDIT CARDS. It seems like it would be the smart thing to do, however, when you consolidate all of your debt onto one card, it appears that you are maxed out on that card, and the system will penalize you as mentioned above in 4. If you want to save money on credit card interest rates, wait until after closing.

•6. DON'T DO ANYTHING THAT WILL CAUSE A RED FLAG TO BE RAISED BY THE SCORING SYSTEM. This would include adding new accounts, co-signing on a loan, changing your name or address with the bureaus. The less activity on your reports during the loan process, the better.

•7. DO JOIN A CREDIT WATCH PROGRAM. If you join a credit watch program, you can check your reports weekly, or even daily depending on the program you select. (When you pull your own reports, you don't get dinged for a hard inquiry.) This way, if something does show up on your reports that has caused your score to go down, you'll know it immediately, and you may be able to take care of the problem before closing.

•8. DO STAY CURRENT ON EXISTING ACCOUNTS. Like your mortgage and car payments. One 30-day late can cost you anywhere from 30-75.

•9. DO CONTINUE TO USE YOUR CREDIT AS NORMAL. Red Flags are raised easily with the scoring system. If it appears that you are changing your pattern, it will raise a red flag, and your score could go down.

•10. DO CALL YOUR LOAN OFFICER if you receive something in the mail from a creditor or collection agency that you believe may affect your score during the loan process. Your broker may be able to supply you with theresources you need to stop any derogatory reporting to the bureaus.

One Of The Nations Foremost Realtors Reveals The Shocking Truth About The New World Of Real Estate

Mortgage Master Inc. — Fri, 31 Aug 2007 11:34:59 -0500

First let me start of by saying that I am a mortgage banker and pay good money to be a member of a mortgage training company that provides me with interviews of the nation’s top realtors. I am interested in the success of our local agents as I am in my own. I have about 15-20 copies of the latest interview with a top realtor, Terry Moerler. I have given these away to my current referral partners and as a new member of Active Rain I am offering this to local agents in MA.

How Thousands Of Agents Could Be Forced Out Of The Business Before They Know What Hit Them! "This is must have information for any Realtor who is serious about growing their business!"
"The insights are incredible! You have to own a copy of this CD!"

Now more than ever, real estate agents are hurting. In fact, today's tough real estate market has already begun a cleansing process that hasn't been seen since the challenging market of 1994. Real estate agents who are unable or unwilling to adjust to the New World of Real Estate could find themselves out of business.

Stop Letting Frustrating Sellers Who Demand You Run Ads In All The Publications And Get Top Price For Their Home Run Your Life!

As Broker-Owner of Keller Williams Realty, Terry Moerler has been one of the nation's top real estate agents for the last 20 years, and has remained a trusted advisor to her clients throughout all types of real estate markets. A former bank loan officer and Income Tax Practitioner, Terry has helped over 2,000 families and individuals realize their real estate goals. Beyond her strong commitment, enthusiasm, and keen understanding of the industry, Terry's success is the predictable result of a continuous flow of client referrals.

The Shocking Truth Is Revealed In This Exclusive Interview!!!!!!

Stop Frustration Of Clients Shopping You And Get Them To Sign The Agreement!
Have More Successful Transactions And Additional Referrals!
What You Should Say To Set Up The Proper Expectations With Sellers!
Where 80% Of Homebuyers Go To Find A Home And How You Can Take Advantage Of This Opportunity!
Enhance The Marketability Of A Home Using Strategic Incentives!
Learn How To Master The Art Of Communication To Propel You To Become One Of The Elite Agents!

Limited Quantities Available! Email to jfontaine@Familychoicemortgage.com or print and fax to 508-753-1744

___ YES! Please rush me this Limited Offer CD Interview!

Name; ___________________________ Company: ________________________________

Address: ________________________________________________________________

Phone: ______________________ Email: _______________________________________

My main area of problem with my business is: __ database management

__ getting leads ___ lead conversion ___ time management ___ marketing___ referral partners

The Google Effect

Mortgage Master Inc. — Thu, 30 Aug 2007 12:22:59 -0500

The Google Effect

Search engines can help you to find out more about individuals you'd like to do business with.

Do you know enough about your prospects and potential strategic partners when you meet for that first appointment?

The Internet can tremendously aid your business in many different ways. One of the great benefits is Google, the world's leading search engine, aptly located at http://www.google.com/. This search engine allows you to access a wealth of information about people-possibly those with whom you seek to form a relationship. Use this utility to research backgrounds on individuals prior to meeting with them.

As sales people, we've been told, "Use your mouth less and your ears more," especially on the first few appointments. That gives us a clearer view of our prospective clients' and referral partners' hot buttons.

Often, because of our insecurity as sales people, we present our sales pitch too aggressively. We essentially toss darts at a dartboard and hope to come close to hitting the bull's eye. That's where Google comes in handy. Consider the value of walking into an appointment, armed with the knowledge of a prospective client's goals and interests.

Many people have Web pages loaded with personal information about their family, their hobbies, and their successes. The more data you gather about your contacts, the better you can tailor your presentations to suit their needs and desires.

By doing a little preliminary research, your interactions will dramatically improve. This will lead to an increased conversion ratio from prospect to client.

Here's another hot tip! Would you like a quick listing of all the professionals in a certain field in your area? Try http://local.google.com/, and put in the name of the profession (for example, "realtor"), along with your zip code. Google combines search data with Yellow Pages references to compile an amazing list of professionals, including business phone numbers, addresses, as well as links to their websites. You can use this information to develop strategic partnerships in a variety of fields.

Mortgage Meltdown

Mortgage Master Inc. — Wed, 29 Aug 2007 16:02:19 -0500

Mortgage Meltdown

There is no doubt that what we are experiencing today is unprecedented in real estate and mortgage lending. My name is Jason Fontaine, and I am a mortgage professional with Family Choice Mortgage.

The purpose of this letter is to give you a brief overview of what is taking place within mortgage lending at this time and to offer you insights that you can share with both your sellers and buyers. This information will allow you not only to profit in today's market, but it will help you advise your clients so that they can make educated decisions about buying and selling property.

What I'm going to do for you today is similar to what a pilot of a hurricane-hunter airplane does. I'm going to take you right into the eye of this hurricane, so that you can prepare for the kind of storm that's about to come ashore. And, from what I can tell, the storm we are about to be hit with is major, even catastrophic.

The mortgage meltdown of 2007 is one those storms. If you were to try and compare the economic damage of this financial storm to that of the storm in this picture, don't even try. In the past few weeks alone, over $2 trillion was lost in global markets, and I don't think we are anywhere near the worst of it yet. And, to add salt to the wound, we are seeing signs that what's taking place here in the United States is starting to infect other countries as well. Within the global economy, not only are other countries dealing with their own subprime woes, other financial companies in these countries have invested in our mortgage-backed securities as well.

To get an idea of what it is that brought us here, we have to wrap our arms around what's happened. We have to understand the key determining factors. As with anything this major, there wasn't just one thing that brought this situation to light. No, quite the contrary. There were a number of factors that, once aligned, produced the laser-like heat that ignited and culminated in the meltdown we have today.

First of all, we have what is known as Subprime and Alt-A lending. Subprime lending is for people who would like to get a mortgage but haven't done a good job of paying their bills. However, as we're in the days when tracking one's FICO score has become a hobby for some, lows scores - even in conjunction with no late pays - can force someone into a subprime mortgage. Other factors mandating the necessity of a subprime loan could be little-to-no down-payment, the inability to validate income with tax returns, or the inability to source funds for a down-payment. Or, it could just be a combination of all of the items mentioned here.

Alt-A lending is a lot like subprime lending, except that the borrower will predominantly have good credit. With Alt-A loans, borrowers are unable or unwilling to provide documentation for income and/or assets. These types of loans are commonly referred to as Stated- or Reduced-documentation type loans, or the infamous No Doc or no-documentation-required loan.

All told, including some A Paper type loans, in which little to no docs were required, these loan types accounted for anywhere between 40%-70% of the mortgage business in the last few years. Folks, these accounted for a lot of the loans that were getting done.

During the time of the real estate boom, rampant appreciation was seen in the housing market. Investors clamoring for ever-higher returns turned to the real estate market and credit markets to take advantage of the boom. This insatiable appetite for new profits led to some pretty wild and loose underwriting guidelines.

To give you an idea of how loose things had become, we were able to provide someone with 100% financing for a $685K purchase - this person was recently self-employed, had two foreclosures, and a bankruptcy within two years, all on stated income and stated assets. I don't think you personally would have extended money to this person, but the financial markets were willing to. The person was granted a mortgage based on perfection within the markets, both housing and investment. Today, this borrower would not be granted anything even remotely close. If this person were to slip on a banana peel, do you think he might miss a mortgage payment or lose his house? In short, yes.

I can't tell you whether or not the individual in question is still paying his mortgage on time, but others clearly were not. Consumers started showing problems in the third and fourth quarters of last year, and mortgage delinquencies started to mount. As such, bond investors started pulling back and companies started to fall.

We started to see weakness in the mortgage market last December, when the first of several large companies was set to take a fall. Own-It Mortgage, a subprime company that was set to close over $20 billion in loans in 2007 was hit with a lack of desire by investors to buy the loans they had funded. Unable to fund the loans themselves, Own-It was forced to close their doors, becoming one of the first ten companies to go down the tubes and be featured on the Mortgage Implodes website, which now lists 114 companies that have gone away.

Let's take a brief look into the world of mortgages. Few mortgages are held by the bank or the investor that funds them. Over the past ten to fifteen years, the securities markets have grown markedly as the appetite for higher yield products has grown immeasurably. With this appetite grew a desire for riskier loans that companies package and sell in pools known as mortgage-backed securities. Mortgage-backed securities are sold on the open market and are traded much like any other bond, with the expectation that people with mortgages will pay monthly on their obligations, netting an expected yield for the end investor.

What happens is that a company may package a group of $100 million in loans and sell them on the open market for anywhere from $100-101 million. As investors realized these loans were not performing, they were now willing to pay only $95 million for the same batch of loans. And, in some cases, even less. In addition, as many of these investors used the loans as leverage for other investments, they were used on margin, similar to what you might do in an investment account. As the value of the funds was decreasing, the mortgage companies were also forced to pay into the investment to make their margin calls, forcing additional pressure and cash drains. In a sense, this was the perfect storm for mortgage companies, and they are paying for it with their company's life. This was seen with the recent demise of American Home Mortgage and other companies, as investors decided they didn't want these loans, forcing the companies out.

What happened next is we saw the slowdown in the real estate market, as home prices started to deteriorate in 2006. However, we've never seen a real estate market on a national scale where home prices fell. The investment and underwriting models for which these loans were originated were, in part, based on this.

As home prices started to stagnate, many people who obtained loans based on the premise of continually escalating home prices were caught in a trap, as they were unable to sell and unable to refinance their loan. The homeowner who had been living a lifestyle based on their equity was now maxed out, having spent way beyond their normal means. With no more equity to pull out to consolidate or lower their payments, they were now in trouble.

As a result of these problems, we now have loans in the investment markets where even if a lender were willing to approve them, they wouldn't be able to sell them, effectively turning them into "Officer and a Gentleman" loans, screaming, I got nowhere else to go!

What's next for real estate? Let's think about this. With changes to credit tightening, a huge number of people will now be unable to purchase a home. On a percentage basis, we're talking about a minimum of 15% of borrowers will be impacted by processing styles and loan availability alone. In a U.S. market where six million people buy homes, you just took 900,000 buyers off the market. It doesn't mean that people won't still need to sell though. Consequently, we're seeing increasing inventories and increasing marketing times. I don't think that 12 months of inventory is an unreasonable estimate, as many areas of the country are already experiencing well in excess of 18-24 months. Accompanying this will be more foreclosures. Foreclosure activity in July was double what it was for the same time last year.

It's estimated that in the next 12-18 months, over 2 million people will be faced with their Adjustable Rate Mortgages resetting, resulting in an increase in their minimum payments of anywhere from 30-100%. While this one action will not push people over the top, what it does do is add additional strain to an already over-leveraged consumer. Add in any life events - such as injury, loss of job, or increasing payments due to rising interest rates in the consumer arena - and you have a recipe for financial disaster.

If I am a seller, I need to be aware of this in light of a slowing housing market. For anyone who has seen rapidly appreciating property values the past few years, it could be difficult to accept the fact that their home is now worth less than before. However, to use a stock market analogy, if you need to sell stock that yesterday warranted $10,000 and today was worth $8,500, would you decide not to sell, even if you were now losing money? Of course not, provided you had the means to absorb the loss. Well, the same beliefs should apply here.

The borrowers who will be caught up in this mess are the ones who were looking to obtain minimal-to-no documentation type loans. This includes those with great, good, and poor credit alike. Some have estimated that these types of loans account for nearly 40%-70% of all the loans originated in 2005-2006. What this means for real estate moving forward is that there will be far fewer buyers who are able to qualify under the terms of their last mortgage. While this won't necessarily take all of these people off the market, obtaining financing going forward will be a much more difficult process for them.

Not everyone is caught up in this mess. For the plain vanilla type of borrower, someone who has a job, savings, and the ability to provide documentation - as used to be required - these borrowers are still fine. And, with some products, there will still be some stated income opportunities without exorbitant rates. In addition, government loans will pick up a lot of the slack for those individuals with credit issues and minimal down payments.

However, as this situation continues to evolve, things are subject to change. So it's important not to get too comfortable.

Let me ask you a question. What would your business look like if you were to close 50% fewer deals over the next 12 months? All of the factors mentioned here so far could very well have that kind of impact on many in our business.

However, it doesn't have to be this way. There are opportunities for everyone in our business. There are opportunities with sellers and with buyers, but we have to act fast, act decisively, and get started now.

For sellers, it's important that they get real about their price, and quickly. They cannot afford to wait as pressures will build rapidly, and, when they do, money will be lost. The lowest price that they may be willing to accept today could very well become an unrealistic wish six to twelve months from now. And, if they don't reduce their price, their home may never even get shown. Also, as lenders have now pulled back on second mortgages, sellers may need to consider holding a second in some cases.

Absolutely do not accept an offer from a buyer who has not been pre-approved by a reputable lender under any circumstances. And make sure that the approval is recent. With buyers becoming few and far between, sellers don't want to take their home off the market, only to have the deal blow up six weeks from now.

Finally, get sellers pre-approved. You don't want to have a deal blow up because the seller can't buy later.

What about buyers? For buyers who are seeking 100% financing, where it is available, it will be more expensive - either in the form of higher rates or non-available seconds. This doesn't mean that for some programs, as in community homebuyer, etc., that it isn't available. But, for more expensive homes, it's going to be difficult in many cases.

With second mortgages cutting back, it's time to start thinking about getting PMI again. For many people, it's become tax deductible this year.

Before a buyer gets too busy shopping, they need to take a look at their credit. In many cases, improvements to FICO scores can be had through just some minor changes to their profile.

Finally, borrowers should go ahead and start collecting their paperwork. This includes all the traditional information like tax returns, bank statements, and pay stubs. This will always help someone to achieve the best possible rate.

The reason checking credit is essential is that FICO scores are very important. There are some hard, fast lines in the sand when it comes to certain approvals, and the numbers we're looking at are 720, 680, and 620. Depending on the loan program, a certain score is needed and, without it, you can forget it. Exceptions are now basically non-existent.

Proper credit repair and maintenance can be the difference between a homeowner and a tire kicker today. When you have control over the buyer, try to get them started on this process 3-6 months in advance. The difference this could make to them and to you is a home priced tens of thousands of dollars higher.

In order to obtain the best-priced loan, let your clients know that they need to get their documentation together. Once we have it in hand, we no longer have to make estimates on what people can afford and qualify for. It will save them money and help them to buy more home.

Now is not the time to go it alone. And it's not the time to refer three lenders. Partnerships are critical to your success. Unfortunately, too many people became comfortable with the idea that everyone could get a loan and it wasn't important who a buyer got their loan from. Not today. You need one "go to lender" who not only has product, but who's also an expert in underwriting and credit analysis, has a great credit repair partner, and is local and accountable. A loan officer from Quicken Loans, or an out-of-the-area lender, doesn't stand to lose much reputation-wise if your deal goes south. I do.

The news isn't all bad though, and there are future possibilities. Instead of focusing on what the media is harping on each day, think about the fact that subprime only accounted for a little over 12% of mortgage production last year. There is still massive opportunity. But I'm going to need you to keep your head up and do things a little differently from now on. Whether you work with me or another lender, you need to have them involved from the very beginning with both buyers and sellers. We can present facts together that may be more compelling and also keep the fire under them.

For those who follow the steps I'm suggesting here, there's definitely profit for you ahead. However, you need a plan. Part of that plan includes educating your sellers regarding what's taking place today, not just in real estate, but in mortgages as well. Let them know what's on the horizon, and obtain significant reductions. Make sure any buyer, while desirable, is properly scrutinized. By positioning the property appropriately, you can get it off the market and save marketing dollars. And, by all means, make sure your sellers get pre-approved. We don't want them to be the reason why they're unable to move.

For buyers, many of the same rules apply. First and foremost, don't spend time showing them a home without checking them out first. This will benefit both you and the buyer. Even the best of candidates may have issues we don't know about. Also, keep in mind that investors are more important now than they were during the boom. Cultivate these relationships, they will be important.

What I want you to leave here with is a plan to meet with not only your sellers, but also any buyers you may be working with as well. Have action meetings with them. Inform them of the current crisis, and educate them in order to get them to act. When it comes to sellers, use me to find out what they are really willing to do under a worst case scenario. When you find their dollar amount, market the heck out of it to other agents, letting them know you have someone who is hot to sell, I mean REALLY HOT!

Start to think of buyers as almost the same as listings today. Once you let them know that they may not be able to qualify in the future, they should be more motivated to act today. Get them pre-approved and keep them pre-approved based on current conditions. Once you have them, direct them towards your realistic sellers. Also, be sure to communicate with other listing agents and make them aware that you have a real buyer. They'll let you know who it is that they're working with who's hot to sell.

Together, we can work through this and position ourselves to really succeed when this cloud lifts, ensuring great years ahead.

Family Choice Mortgage is in their 10^th year lending in New England, we work mostly with new home buyers. I am always looking to add experienced agents to my team. Most of my clients do not have a realtor when they come to me and I look to refer then out to one of my partners. Again my name is Jason Fontaine with Family Choice Mortgage and I look forward to working with you.