Kirk's Blog

Ten economic hardships that may allow for a Short Sale

Prudential California Realty/Bristol Home Loans — Thu, 08 Jan 2009 22:15:38 -0600

Long Beach, Ca. After President-elect Obama's aggressive speech about how the government needs to intervene quickly before the United States slips into a tail spin that, "we may not recover from," and begins to detail the multi-trillion dollar bailout plan that he plans to implement, one begins to wonder how we can go from only 45 days ago when the Government announced that not only were we in a recession but we have been in it for over a year!, to well what looks like the Depression of 1932.

This is mind-boggling and troublesome; nevertheless, many American Families are truly, "distressed." When moves made by the Democrats to have Bankruptcy Judges empowered to readjust mortgage payments, combined with the fact that 10% of all mortgages are in default (that's approximately 5 million mortgage out of fifty million), we know that we are in for some serious licks. For families suffering from job loss or other set backs, it is important that they understand what actually qualifies them for a hardship. If there is a legitimate hardship, banks may allow the family to sell their property through a short sale which would be better for them then losing the property through foreclosure.

The following are acceptable examples of Hardships wherein if proved would more then likely give the bank a green light for a short sale:

1. The property has more mortgages on it then what it is actually worth

2. The property is owned by a person going through economic hardship and instability, possibly a loss of a job, reduced income, failed business.

3. Death of a spouse, co-borrower or family member.

4. Incarceration.

5. Job relocation.

6. Divorce or Marital Separation.

7. Military Duty.

8. Medical Bills or prolonged illness.

9. The property is about to be in foreclosure or is; in fact, currently in the foreclosure process.

10. A property that is in damaged and poor physical condition.

Specifically, there are many American families that need to sell their homes through short sales rather then lose them to foreclosure so that they can situate themselves for repurchasing real estate after the eventual stabilization of the markets.

Kirk Mulhearn is a licensed real estate broker and mortgage planner. He may be contacted at 866-961-8042 ext. 110 or e mail him at kirkmulhearn@gmail.com

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Long Beach Mortgage Report: Concern over future loan pricing due to Democratic Moves

Prudential California Realty/Bristol Home Loans — Thu, 08 Jan 2009 12:42:25 -0600

Long Beach, CA. We are very concerned about this development for future mortgage pricing. In what appears to be a reversal in position for the banking industry, Citigroup Inc. is in talks with lenders regarding legislation to permit mortgage restructuring in bankruptcy court. The industry previously has warned that "cram downs" would boost borrowing costs, but such bankruptcy reform has the support of many Democrats as well as President-elect Barack Obama. Sen. Dick Durbin, D-Ill., introduced a bill on Jan. 6 to allow bankruptcy judges to restructure mortgages, and similar legislation was also raised in the House. Some estimates say this will increase the cost of a mortgage by 50 basis points in rate to one point. The Mortgage Bankers Association is opposed to this, but given the democratic controlled Congress, this appears likely to become passed.

As we all know by now, CalHFA has stopped lending and is working to de-leverage their balance sheet. Yet this is at a time when we expect a government agency to support the credit crisis, not curtail their lending. Why has this happened? Apparently the agency faces a credit rating downgrade and must work through a half billion of bonds that have been put back to their banks which forced the agency to focus on their balance sheet rather than lend. Meaning no money for prospective borrowers.

Finally we are seeing this morning comments about the need to address Fannie and Freddie. President-elect Barack Obama has little time to decide the fate of Fannie Mae and Freddie Mac as bank regulators warn of the drag the government-seized mortgage- finance companies are having on the U.S. economy. Federal regulators are concerned that if the new Obama administration doesn't act quickly enough it may miss the opportunity to resolve the ambiguous government backing of Fannie and Freddie, an arrangement that has scared away many foreign investors the companies rely on to fund new loans. Throwing the full faith and credit of the U.S. behind Fannie and Freddie may almost double the $5.8 trillion in federal debt, pushing Treasury rates higher, raising the government's borrowing costs, and boosting inflation. Regulators may be ready to pay that price, with some pushing for an explicit guarantee for the companies and others seeing the need for nationalization. We need to watch this as it would clearly impact the drop in rates we have received.

U.S. stocks have slid for a second day after retailers from Wal-Mart Stores Inc. to Limited Brands Inc. said profit will trail forecasts as the recession limited holiday spending and sent jobless claims to a 26-year high. Equities have fell three of four days this week as the recession forced the biggest U.S. companies to acknowledge that forecasts made last year were too optimistic. The five-quarter slump in profits at S&P 500 companies is projected to last two full years before a rebound in the second half of 2009, according to most analyst estimates.

Based upon the high jobless claims, treasuries and mortgage backed have held and MBS are up 4/32nds from yesterday at the moment or about .125% in price. But as you all know by now, our investors are not necessarily following this one for one for a variety of reasons. Such as taking in too many locks, limited staff or their capacity. Currently, the Ten Year yield is at 2.44% (2.48% yesterday). On Tuesday, Chase wholesale went so far as to send this out from their wholesale channel, "Due to high registration volume, effective 3:00 PM Eastern Time, Chase is temporarily suspending all new registrations and locks until the next business day's rate sheets are delivered." Couldn't they just price themselves out just like other lenders? Yet the headlines like the link below continue to show borrowers that they can find 30-yr mortgages below 5%, especially at bank branches. http://www.bloomberg.com/apps/news?pid=20601103&sid=abG3KpLnk0IE&refer=us

Kirk Mulhearn is a professional mortgage planner and real estate broker, he may be reached at 866-961-8042 ext. 110 or Kirkmulhearn@gmail.com

Long Beach Mortgage Report: Washington Post on the economy

Prudential California Realty/Bristol Home Loans — Wed, 07 Jan 2009 13:12:13 -0600

Long Beach, CA. Will 2009 bring economic collapse or will markets begin to mend?
Two reliable predictors give hope. First, the spread between LIBOR and Treasury yields, which measures global risk. The spread ended the year tighter than when it began, and far tighter than the extreme levels of late summer. Second, volatility embedded in stock option prices is a good predictor, and is referred to as the "fear index." While still elevated, it ended the year reflecting much less fear than the worst seen in 2008. Both indicators lead us to believe that the economy has backed away from the brink.

While the economy may not collapse completely, we have some tough work ahead of us. Recessions brought on by financial crises (rather than typical business cycles) are severe, reports John Mauldin. In past such recessions, real housing prices declined 35% over six years, while equity prices collapsed 55% percent over three and a half years. The unemployment rate rose by 7% over four years and output fell 9% over two years. And government debt increased massively. By these historical measures, we have a long way to go.

The good news for home buyers is that mortgage rates are low, and are likely to stay that way. Fallout - of the 50% variety - and early loan payoffs have become the problems du jour. In spite of Barron's warning to "get out (of Treasuries) now," there is little economic reason for mortgage rates to rise. Nary a holiday party went by without someone asking when they could have their 4.50% mortgage rate (in the near future, we think). Mortgage demand is strong. The New York Fed "began purchasing fixed-rate mortgage- backed securities guaranteed by Fannie Mae, Freddie Mac and Ginnie Mae," the Fed bank said in a statement released by e- mail.

So severe is the concern over lower rates, fallout, and refinanced mortgages, that the lack of premium mortgage pricing is as much an impediment to the refinance boom as anything else. You can pick any premium mortgage rate you want and your loan officer price struggles to get to par. This will continue I am afraid until the housing market is steadied for prices and buyers other than the Federal government begin purchasing mortgage backed bonds.

The Fed began their MBS buying program yesterday; they will announce the amount purchased each Thursday. The mortgage basis tightened off of this purchasing pressure. Oil is now at a five week high as OPEC's production cuts are starting to have an effect on the market, oil is now above $50/barrel. Right now the futures market is pricing in a 76% chance that the Fed keeps rates somewhere between 0 and .25% until at least April 29^th, 2009. Currently, the Ten Year yield is at 2.56% (2.47% yesterday)

Speaking of rates, the historical link between Treasury rates and mortgage rates is practically non-existent. Yesterday, for example, Treasury rates moved up since Construction Spending fell only .6%, less than half as what was forecast, and before the $54 billion in government securities to be sold this week ($8 billion in 10-yr TIPS today). The government's sale of notes this week is causing impacting the supply side of the equation, moving Treasury rates higher. So this morning we find the yield on the 10-yr up to 2.56%, but mortgage prices are better than yesterday afternoon by .50% and continuing to show improvement. Remember, investors have been very slow to reflect, but I would wait one hour or so and most investors should begin to reflect the improving price. However, as I have said over and over, the market is artificially being impacted and can quickly retreat.

Kirk Mulhearn, A professional Mortgage Planner, may be contacted at 866-961-8042 ext. 110

Long Beach Mortgage Report: Will the 2009 economy collapse or begin to mend?

Prudential California Realty/Bristol Home Loans — Tue, 06 Jan 2009 15:39:42 -0600

Kirk Mulhearn, A professional Mortgage Planner, may be contacted at 866-961-8042 ext. 110

Remember to be realistic about Loan Modifications and remember to consider all of your options

Prudential California Realty/Bristol Home Loans — Mon, 05 Jan 2009 17:17:58 -0600

Long Beach, CA. You might not have caught key details that could have personal impact on you or people you know-now or in the recession months ahead. One of the most ambitious mass-market "loan modification" programs was outlined recently by the Federal Housing Finance Agency-overseer or Fannie Mae and Freddie Mac-along with the 33 banks and mortgage servicers who make up the private-sector Hope Now Alliance.

The program, which started nationwide December 15th, is for thousands of subprime and other borrowers who are seriously behind on payments-three months or more-and are slipping fast toward foreclosure. To be eligible for intervention, owners need to document that they can handle mortgage payments with up to 38 percent of their monthly gross income.

They also need to demonstrate that they have experienced some form of financial reversal that made them delinquent on their payments, and prove that they did not intentionally go into default just to get better terms.

If they can pass through these hoops, borrowers may qualify for sharply reduced interest rates, deferrals of principal payments or extended loan terms-whatever combination it takes to get them an affordable payment with their current income.

Participating lenders say they want to hear as early as possible from potential beneficiaries. If homeowners can't connect directly, they can work through the Hope Now Alliance (www.hopenow.com) or through the U.S. Department of Housing and Urban Development (www.hud.gov/foreclosure).

The same day the new federally assisted mass modifications effort was announced, one of the largest lenders and servicers-Citicorp-unveiled a program designed to catch at-risk home owners before they fall behind.

Beginning last month, Citicorp will reach out to an estimated 500,000 mortgage customers who are not currently delinquent but who appear to be at risk-either because their credit files show tell-take signs of financial stress or because their homes are located in markets Citicorp believes face serious economic strains and job losses in the coming year.

Although most mortgage industry executives and economists believe that today's foreclosure crisis is so serious that only wholesale remedial approaches can prevent home losses from piling up, not everyone agrees with the new programs or the loan modification options they throw to homeowners.

Bottom line for borrowers: Definitely pursue a loan modification if you qualify and need one. But talk with your servicer or loan officer to make sure that the revised terms you're signing up for are realistic for your long-range economic situation, and not likely to be just a temporary patch.

Kirk Mulhearn is the co-owner and manager of the Bixby Knolls' Prudential California Realty branch, and the co-manager of G.E.M., Golden Empire Mortgage, also located at the Bixby Knolls' office. He can be reached at 866-961-8042 ext.110 or on his cell @ 562.965.0054.

Long Beach Mortgage Report: Obama Stimulus includes $300 billion tax cut

Prudential California Realty/Bristol Home Loans — Mon, 05 Jan 2009 16:58:45 -0600

Long Beach, Ca. There is no news today, aside from Construction Spending. Tomorrow we have the Commerce Department's November Factory Orders data. This data gives us a fairly important measurement of manufacturing sector strength, both in durable and non-durable goods, and is expected down 2.6%. Also Tuesday will be the release of the minutes from the last FOMC meeting. This will give market participants insight to the Fed's thinking and concerns regarding inflation and monetary policy. The usual Jobless Claims on Thursday, and then the final report of the week comes Friday morning when the Labor Department will post December's employment figures. Current forecasts call for a 0.3% increase in the unemployment rate up to 7.0%, and Nonfarm Payroll -500,000.

Not much happened to the economy in the last 4-5 days, aside from dire numbers coming from retailers which ordinarily would help rates. Yet we find the 10-yr Treasury hit 2.50%! It has come back down slightly from there, but keep in mind that a) The market was overbought, suggesting that a correction was due, b) we have supply ahead with a 3-yr and 10-yr auction this week on Wednesday and Thursday, and a 10-yr TIPS auction tomorrow, c) how much lower did anyone think that rates were going to go, in the near term? Fortunately mortgage rates and doing better than Treasuries, which makes some sense given that they did not participate in the big move down. Currently the 10-yr is at 2.43%, and mortgage prices are perhaps .5 better in price than late last week until the last 30 minutes where are pricing has faded to no improvement. Our window of the FED buying mortgages seems to be lifted as pricing quickly has faded in the last 30 minutes.

According to Democratic aides, President-elect Obama's $775B economic stimulus plan will include more than $300B in tax cuts. The proposal appears to have the support of both parties. The dollar rose on speculation that the plan will help the economy recover from recession. Right now the futures market is pricing in an 82% chance that the Fed keeps rates somewhere between 0 and .25% until at least April 29^th, 2009.

The Federal Reserve Bank of New York said Monday it has begun purchasing mortgage-backed securities in an effort to bolster the battered housing market. The program, initially announced Nov. 25, allows the Fed to spend $500 billion to buy mortgage-backed securities guaranteed by mortgage giants Fannie Mae and Freddie Mac and another $100 billion to directly purchase mortgages held by Fannie, Freddie and the Federal Home Loan Banks. The program is aimed at driving down the price of mortgages and making home loans more available. When the government comes into our market, we see improvement in pricing and as quickly as it does, it begins to fade. As I said last week, I believe rates will relax somewhat further but is driven by the only buyer we have, the Federal Government for mortgage backed securities.

To apply for a mortgage, contact Kirk Mulhearn at 866-961-8042 ext.110

email: kirkmulhearn@gmail.com

America seems to be One Big Distressed Property

Prudential California Realty/Bristol Home Loans — Sun, 04 Jan 2009 10:53:15 -0600

Long Beach, CA. In even, "normal" markets, there are always families and individuals that suffer from hardship. According to most investor publications, the default rates should only be between 1-3% in a healthy and normal economy. However, in the current real estate malaise in Southern California approximately 55% of all properties sold are considered, "distressed." Out of these properties, over two thirds of these distressed properties end up selling through what is known as, "Short Sales."

These are clearly an astonishing figures and extremely troublesome considering that unemployment figures seem to be getting worse daily. Wherein you have government officials complaining that in order for the economy to get better, we have to have even more consumerism and spending, they seem to forget that that is impossible for Americans to spend money without Americans having jobs, more on that in a later blog.

Furthermore, in some neighborhoods in California, Florida and Nevada, we are seeing foreclosures of 50% or more, the shear tidal wave of foreclosures of this magnitude is unheard of in the history of in the Republic.

It is no longer an option for real estate agents and home owners alike to be ignorant of these trends, especially considering that everyone in one way or the other is affected by them because when your next door property sells on the courthouse steps due to foreclosure, it immediately affects the value of your own home.

The fact is that the entire landscape of the residential and commercial real estate markets have completely changed due to defaulting and distressed properties. Understanding what is acceptable to a bank when proposing to list the said property is a must in the current situation.

Imagine for a moment, that you are a real estate agent sitting down to list a property for sale when, after reviewing the latest mortgage statement from the home owner it is discovered that the property is "upside down" by over $100,000.00 Then, the home owner confides that he is 2 months behind in the mortgage payments. Basically, the wheels have fallen off the traditional SUV-like real estate market. There really are few "normal" sales here in Southern California. In fact, the definition of "normal" in real estate is wide open to interpretation:

What is a normal listing? What is a normal short sale? What is a normal REO? What is a normal mortgage? What is normal devaluation? What is normal inflation/deflation?

As 2009 unfolds and we all experience the new economy wherein frugality is in and blind consumption is out, we are forced to understand that we are all in this together. That the pressure on the middle class is easily felt in your children's school yard, just talk to the other parents, or in the work place or family gatherings, just converse with your extended family about these challenging times and you will soon discover how universal are the problems facing America today.

As distressed as America is, the natural reaction is to bond together with each other and turn to people and professionals that you can depend on to help resolve whatever difficult situation you might be facing. We must learn to get along with each other again. Wherein in the past you might not cared about your neighbor, in the future, for survival's sake you must get to know all of the people around you and engage them in a positive manner.

Kirk Mulhearn is a Certified Distressed Property Expert. He runs Prudential California Realty, "The Bixby Knolls Branch," in Long Beach, California. To contact him,

Telephone: 866-961-8042 ext. 110

Email: kirkmulhearn@gmail.com

Blog: www.longbeachrealestateandloans.com

Ten Consequences to consider when considering a foreclosure verses a short sale

Prudential California Realty/Bristol Home Loans — Sat, 03 Jan 2009 14:03:09 -0600

Long Beach, CA. There are many consequences to having a foreclosure or opting for a short sale. A foreclosure is when you let the property, "go back to the bank," a short sale is when you sell the property for less then what is owed on the property. The following summarizes the potential effects to the home buyer:

Sercurity Clearances If you are considering a foreclosure, this is a very important factor to consider if the current home owner is employed as a civil servant. It is a most serious issue if you are employed as a Federal, State, or Municipality. Especially, if the client is in the Military or Police Department, Central Intelligence Agency, Security, or any other position that requires some type of security employment. In almost all cases, the security clearances will be revoked and the position could be terminated. Conversely, a short sale does not challenge security clearances.
Current Employment While considering foreclosure vis-à-vis retaining your employment, it must be noted that depending on how sensitive your position is, employers do have the right to consider termination if you opt for foreclosure wherein if you go through a short sale, it will not be on your credit report and; therefore, will not be a challenge for your continued employment.
Future Employment Many employers require stiff back ground checks on all job applicants. A foreclosure is one of the worst things that can be noted on your credit report wherein if you had a short sale, future employers will not be aware of the transaction unless you disclose it.
Deficiency Judgment In 100% of foreclosures(except in those state wherein there is no deficiency) the bank can pursue a deficiency judgment. In some successful short sales, it is possible to negotiate with the lender not to go after the home owner for a deficiency judgment.
Deficiency Judgment(amount) In case the property does go through foreclosure in a State that can go after a deficiency judgment, the property will have to go through a long and extended REO process; thus, increasing the losses to the bank and increasing the amount of the judgment against the home owner. However, if the home owner goes through a short sale, the property will be sold faster and the judgment will be normally less then if you went through a foreclosure.
Future Fannie Mae Loan- Primary Residence If a home owner loses a property to foreclosure, he will not qualify for a new mortgage with Fannie Mae for up to 5 years, but if the home owner successfully negotiates a short sale, this time can be reduced to 2 years from the time the short sale closed.
Future Fannie Mae Loan-Non Primary Residence On future loan applications, after a forclosure, it must be noted that there was a previous foreclosure on the 1003 form. This could affect what interest rate that you get on your new purchase. A short sale question is not asked on the current 1003 forms; therefore, you will not pay a higher interest rate on your future mortgage.
Future Loan with another Mortgage Company
Credit Score With a foreclosure, your credit score could fall between 250 and 300 points! This could affect your score for as long as three years. A short sale will definitely show late mortgage payments, but this normally will only lower your score 50 to 100 points and will only negatively impact you for 12-18 months.
Credit History. Foreclosures will be reported for 10 years on your credit report. Short sales will not be reported on credit history at all, the loan shows, "paid in full."

Kirk Mulhearn is a Certified Distressed Property Expert, you may contact him for a free consultation on the disposition of your property at 866-961-8042 ext.110 or contact him directly at kirkmulhearn@gmail.com, Mr. Mulhearn's blog: www.longbeachrealestateandloans.com contains information on distressed properties.

What is a "Full Doc" Loan?

Prudential California Realty/Bristol Home Loans — Fri, 02 Jan 2009 19:26:22 -0600

Long Beach, Ca. What is a "Full Doc" Loan? In the last two years we have seen an evaporation of almost all "stated income" loans. These loans enabled home buyers to purchase properties without disclosing their actual incomes. Partly, because of these types of loans, the sub-prime loan melt down was conceived, born, and died, throwing the financial markets into a tailspin. As a reaction to the housing collapse, the pendulum has completely swung to the other the opposite side of the banking world.

This means that in the current market, you now have to prove income in order to purchase a home and qualify for a mortgage. In the lending business, we call these, "Full Doc" loans, short for, "full documentation," loans. Historically, banks like to see the following items to document your income:

•1. Federal Tax returns for the last two calendar years.

•2. The latest pay check stub from all of the signers on the loan.

•3. The last two months of Bank Statements from all buyers.

This will be required from all signers that go on a loan application. Note, that if a person in not employed or is a homemaker, they may still go on a loan application but typically will not add to the viability of a loan. In truth, a non-employed spouse may actually hinder the loan origination in that the bank will take into account all of their debts which makes the ratios of income to future housing payment higher; thus, making a higher risk loan.

There are four items that any lender needs to accurately pre-qualify a buyer:

A). Gross income from the entire household.

B). Total monthly debt obligation of all parties on the loan.

C). Available liquid cash that can be used for the purchase.

D). An accurate and recent credit report.

If a lender is set up properly, he can run the above information through an Automatic Underwriting System(AUS) like Fannie Mae's "Desktop Underwriter," which will give a computerized approval within minutes. However, remember the old adage here, "Junk in junk out." If the information was not properly inputted into the computer software, you may have a faulty approval or worse, a loan rejection when you could have actually have qualified. You may take a free loan application by contacting:

Kirk Mulhearn, Mortgage Planner

866-961-8042 ext. 110

www.longbeachrealestateandloans.com

www.kirkmulhearn.com

How to Increase my Credit Scores

Prudential California Realty/Bristol Home Loans — Thu, 01 Jan 2009 13:34:45 -0600

One of the Fastest Ways to Increase Your
FICO® Credit Scores

Long Beach, CA. Please take the time to read the following article on how to improve your credit score. My friend and Credit Clean-up Professional: Steve Manos, is one of the most talented fellows that I have ever met in this field. Home buyers and refinanciers alike need to know how to make their credit look golden, especially when applying for a mortgage. I can't tell you how important it is for everyone to be aware of their current credit score and to know what little things to do to quickly improve these same scores:

Wouldn't it be great if you could just pick up the phone, make a toll-free call and, like magic, your FICO credit scores would go up?
Well, you can.
And the call isn't to the three major credit bureaus asking them to remove inaccurate information from your credit reports...
...or to lenders who have put negative information on your credit reports.
This credit scoring technique is often overlooked.
I've used this strategy to increase my FICO credit scores on many occasions-and it's easy...
All you need to do is pick up the telephone and dial a few toll-free numbers. Within a few minutes you'll have started a chain of events that may quickly increase your scores.
Intrigued yet?
The technique is to simply increase your credit limits on your credit cards.
Credit Mistake #8
Not Increasing Your Credit Limits

Increasing your credit limits is one of the fastest and easiest ways to increase your credit scores.
When you increase your credit limits and your spending patterns remain the same you end up using a smaller percentage of your combined credit limits. This increases your scores.
Make it a practice to ask for higher credit limits on a regular basis, usually every 6 to 12 months. When you ask lenders for a credit limit increase, the credit inquiry will lower your scores, but a credit inquiry is usually less damaging than a maxed out credit limit.
Lenders periodically review your account to determine whether or not to increase your credit limit. This type of credit inquiry will not lower your scores.

Here's How Increasing Your Credit
Limits Increases Your Credit Scores

"One of the quickest ways to increase your credit scores is to increase your credit card limits."
Pretty simple, huh?
Now let me explain why something so easy can have such a great impact.
Let's imagine you have 10 credit cards each with a $1,000 limit. So you have a total (or aggregate) credit card limit of $10,000.
Now let's assume that five of these credit cards are maxed out. In this case, you have a total (or aggregate) credit card balance of $5,000.
Your balance-to-limit ratio is now 50%. You've used $5,000 of your $10,000 total credit limit. This is called your "revolving utilization.." It's the total amount of your credit limits that you are currently using.
Being 50% utilized is considered high by most lenders' standards...and more importantly...by the creators of the FICO credit score.
But now watch what happens.
You pick up the telephone and ask for a credit limit increase on each of the five credit cards you haven't maxed out.
Let's suppose each of the five lenders doubles your credit limit. So now you have 5 credit cards with a $2,000 limit and a $0 balance. But you also have 5 credit cards with a $1,000 limit with no available credit.
By increasing your credit limits you've just reduced your balance-to-limit ratio from 50% to 33%.
And if you doubled the credit limit on the other 5 cards in this example, your balance-to-limit ratio would be 25%.
That's a significant decrease in your ratio!
Bravo! You've just increased your credit scores by making a few free telephone calls.
However, there are some potential pitfalls with this strategy.
When you ask for a credit limit increase it will cause a credit inquiry...the type that lowers your credit scores.
So, to be safe, apply for all credit limit increases within a 14-day period. Here's why.
Great Credit Scoring Tip
Revealed...
When calling to increase the credit limit of credit cards issued by banks and credit unions there's a good chance multiple inquiries will be counted as only one, minimizing the impact several inquiries could have on your credit scores.
In the past, you may have seen me write about how, when you apply for a mortgage or comparison shop to buy a car, you should always do it within a 14-day period since mortgage and auto inquiries made within this time-frame count as only one inquiry.
Well, the same can be true when you ask your bank or credit union to increase your credit limits.
The reason this works is because the FICO credit scoring models can't usually distinguish why a bank or credit union is inquiring about your credit. In other words, there's no way to tell if the bank is inquiring about your credit in order to approve you for a mortgage or because they want to increase your credit limit. So it errs on the side of the consumer because you COULD be applying for a mortgage or auto loan from a bank or credit union. In this case it groups all inquiries within 14 days and counts them as only 1. This is very much in your favor.
But even if you do get stung by a few credit inquiries, generally your reduced utilization percentage will outweigh any negative effect of the inquiries-as long as you don't go on a shopping spree after wards! That brings me to the second pitfall...

Increasing Your Credit Limits Is a "Score Increase"
Strategy, not a "Spend More Money" Strategy
If you go out and use up the newly available credit you'll be back in the same situation with your scores (and you will owe even more money). So don't make that mistake.
Think of your increased limit as overdraft protection on a checking account. You're not supposed to ever use it...but it's nice to have just in case.
You Can Use This Technique to Increase Your
Credit Scores Every Six Months
From personal experience, I've found that you can request that your credit limits be increased about once every six months-as long as you put yourself in a position to deserve an increase.
In order for the credit card companies to increase your credit limits, you obviously need a good payment history with them. If you continually make late payments or have a large balance, odds are they won't increase your limit, so keep this in mind when you ask for limit increases.
At minimum you should: pay your bills early or on time, pay more than the minimum amount due, and/or pay off your balance each month.

Sincerely;

Steven J. Manos
President

Center For Better Credit
3857 Birch Street No.630
Newport Beach, CA 92660

A Non-Profit Corporation Dedicated To Informing And Helping Consumers
Deal With Their Credit Issues & Resolve Their Credit Problems.

(949) 200-7507 Phone
(949) 553-1746 Fax
(714) 277-8583 Cell
(800) 359-0455 Toll Free
www.centerforbettercredit.com Website

Happy New Year to all Southern Californian Real Estate Investors in 2009

Prudential California Realty/Bristol Home Loans — Thu, 01 Jan 2009 13:31:47 -0600

Long Beach, California. I want to wish everyone a Happy New Year for 2009.

Where there is confusion and chaos, there is also great opportunity. The question that you must ask yourself: How do you take advantage of market conditions?

Home prices are extremely low and so are interest rates. Today, I booked two loan applications. The funny thing is that there seems to be almost a 50%-50% chance that a home buyer will not show up for a loan application. Today, both buyers not only showed up at the same time with all of the information in tow necessary to consummate the pre-qualification. I see people, that intuitively sense that this is the time to purchase property.

The tone in the media has been obviously negative in regard to the status of the current market place. As an experienced loan officer, I roll my eyes at the quickening of the changes in the market place. One thing for sure, is that the market will be as bad as people think it is....as much of a realist as I am, and the following facts are definitely dismal, I would suggest everyone to think positively and practically about 2009 and the markets therein. I say this because, I have seen experienced professionals, in all walks of life, simply shut down. It's as if some of my friends have crawled under their desks and have died...

The index of leading U.S. economic indicators fell in November for the fifth time in seven months, reflecting the worsening outlook that led the Federal Reserve to slash interest rates and pledge unlimited purchases of securities. "There is no end to the recession in sight," said Stuart Hoffman, chief economist at PNC Financial Services Group Inc. in Pittsburg, who correctly forecast the decline in the leading index. "The economy is likely to continue to fall hard."

Crude oil fell below $38 a barrel for the first time since July 2004 on speculation that OPEC hasn't trimmed production enough to bolster prices as demand drops. JPMorgan Chase & Co., the largest U.S. bank by assets, reduced its 2009 average oil price forecast to $43 a barrel from $69 as a global economic slowdown causes a contraction in demand. The prospect of oil falling to $25 is "hard to dismiss amid a serious deterioration of economic conditions and building stocks," the bank said in a report released yesterday.

The labor market remained an albatross after a report showing more than 500,000 people filed for unemployment benefits for the first time last week. Buckling demand and deflation have combined to create an environment of layoffs and little new hiring. In Washington, as the Bush administration puts the finishing touches on the Detroit bailout, the Obama administration is authoring a broad stimulus package designed to inject roughly $850 billion into the economy of the next two years, the AP reported.

So where does that leave our mortgage rates? Everyone keeps asking how low will rates go. All of you know by now, the government intervention in the credit markets has destroyed the normal differences between higher coupon and lower coupon bonds. Why would anyone be willing to pay 102 for a 6% coupon when the governments says they want rates to go to 4.5% or lower. So the government will continue to try and lower rates. They should be lower if normal spreads for mortgage backed bonds and treasuries existed. But they still do not. I said earlier I thought we would see 4.75% at a par price. If spreads can be compressed further, it is possible it will get below this to perhaps 4.5% at PAR. But I think to achieve this the rest of the world finance ministers will have to lowers their rates as well. The dollar is starting to weaken again against foreign currencies and will put a floor on how far this can go. Not to mention since we are in debt as a Nation up to our high brows, we cannot expect the rest of the world to continue to say they will take these risks in buying our debt at such low rate of returns. So my best advice, get on the phones to borrowers that can take advantage of these rate levels while they last. There is one guy named to the incoming Obama economic team by the name of Paul Volker who is not afraid to raise rates when the time comes to stamp out inflation. For those of you not around in the1980 to 1982 time period, we lived through 18% 30 year mortgage rates. This is a cake walk compared to that time period and economic issues. Remember, inflation is the one big enemy of our bond market. Right now, they are worried about deflation, but we would expect that to turn sometime next year and that is when they will be taking away the low rate punch bowl. Your rate window can now be measured in hours compared to days, so you have to be ready to move in this artificial credit market environment.

Kirk Mulhearn can be reached at 562-989-4608 Ext. 110

Mortgage Rates fall Again!!!

Prudential California Realty/Bristol Home Loans — Thu, 01 Jan 2009 13:27:04 -0600

Mortgage Rates fall again

Long Beach,Ca. For the third week in a row, 30 year fixed mortgage rates have fallen to record lows while borrowers take advantage and have been making refinance applications soar to the highest levels since 2003. While the Federal Reserve is about to start directing hundreds of billions of dollars into the hard hit housing market, rates have continues a nine week slide.

Current rates are at an all time low since Freddie Mac started to report back in 1971. These fantastic rates are a great opportunity for borrowers with high credit scores and good job incomes ton lower their mortgage rates and save up to hundreds of dollars a month. However, considering that across the board, real estate values have dropped approximately 48% in Southern California over the last two years, a refinance boom will be dependent on whether or not home owners can show sufficient equity in their homes.

Typically, Fannie and Freddie want more and more the home owners to have a min. of equity in their homes. On the other hand, FHA refinancing allows for borrowers to cash out as much as 95% of the value in their homes.

Freddie Mac reported the average 30-year fixed interest rate at 5.1% this week, down from the previous record of 5.14% set last week. This has made nine straight weeks of interest rate drops. All together, mortgage rates have dropped 1.3% since late October.

Understandably, mortgage applications have increased to the highest level in over 5 years. per the Mortgage Bankers Assn. More then 80% of applications came from smart property owners attempting to lower their interest rates. Those unfortunate home owners who have missed a lot of payments due to loss of employment or defaults on their mortgage will simply have to sit out and not be able to reap the benefits of these rates due to the new high standard of lending required Fannie Mae and Freddie Mac.

In order to see if you qualify for a lower interest rate and house payment, you may contact Kirk Mulhearn, Mortgage Planner @ 562-989-4608 ext.110, www.kirkmulhearn.com from for a free copy of your credit report and a mortgage consultation session to see if it is a good time for you to make a move for a lower rate.

A Happy New Year for Real Estate Investors

Prudential California Realty/Bristol Home Loans — Tue, 30 Dec 2008 21:33:01 -0600

Long Beach, California. I want to wish everyone a Happy New Year for 2009.

Where there is confusion and chaos, there is also great opportunity. The question that you must ask yourself: How do you take advantage of market conditions?

The tone in the media has been obviously negative in regard to the status of the current market place. As an experienced loan officer, I roll my eyes at the quickening of the changes in the market place. One thing for sure, is that the market will be as bad as people think it is....as much of a realist as I am, and the following facts are definitely dismal, I would suggest everyone to think positively and practically about the 2009 and the markets therein. I say this because, I have seen experienced professionals, in all walks of life, simply shut down. It's as if some of my friends have crawled under their desks and have died...

REO Bulk Sales, Truth or Fiction?

Prudential California Realty/Bristol Home Loans — Sat, 24 May 2008 00:12:53 -0500

Long Beach, CA. Recently I been receiving a lot of inquires in regard to the post: Has anyone actually closed and REO bulk Sale. It seems that there is a flurry of activity going on between banks, loan servicing departments, and investors. The latest gossip is that large banks are releasing packages of REO properties for pennies on the dollar. In some cases if the purchase sales price is one billion dollars or more, investors are reputedly snapping up these packages for as low as $.35 on the dollar.

I'm repeating my plea to have any broker who has actually closed a deal to please contact me at this site, it has been six months and nobody has so far been able to prove to me that these deals actually close.

Kirk Mulhearn

Broker/Owner

562-965-0054 mobile

562-989-4608 ext. 110 office

Long Beach, Ca. Five Tips on how to save money with your home insurance policy.

Prudential California Realty/Bristol Home Loans — Fri, 23 May 2008 23:54:50 -0500

Long Beach, Ca. In these difficult times, American families are trying to save every penny possible. Today, I read in the paper about how large Super Market companies like Kroger's and Walmart are re-packaging certain food essentials in smaller containers in an attempt to make the pain at the register more acceptable. In other words, you may be getting the same product for the same price that you did last year in a smaller portions. For example, instead of buying a regular gallon of milk you are getting three quarts of milk for the same price that you did last year. Also, you may see eggs on the shelves in six packs instead of the regular dozen.

This is the result of food retailers trying to meet consumer demands. Pinched consumers are only buying today what they need for tomorrow or by the end of the week. Little food stocking is being done in American households and people are heading to the market now two times a week vs. say, once a week as in the old economy.

In regard to home savings. Homeowner's Insurance Policies have all kind of available savings if the American consumer is aware of the options. The following are six ways to save money on your home insurance policy:

1. Increase the amount of the deductible. By increasing a deductible from $500 to $1000 it can give you an immediate benefit. Of course, remember that when you make an insurance claim that it is monitored and recorded by the insurance companies in a national database so that if you have a history of making a lot of claims then you will be billed accordingly on future premiums. Likewise, if you do not have a lot of claims you will benefit from being a "good customer."

2. If you have the money available, pay the entire annual insurance premium upfront. Paying up front your home insurance policy can help you save between five and ten percent on the premium. Remember, if you don't pay your home insurance inside your monthly mortgage payment, you will have to pay the annual premium alone or break the premium down into twelve monthly payments. Traditionally, only home buyers who put 20% down had this option of paying insurance separately from their mortgage; however, in the last seven years this requirement was softened similar to the credit requirements of buying real estate.

3. Consider allowing the same insurer of your home insure your automobile(s). Most of the major carriers offer great savings if you insure your motor vehicles with the same company. This will simplify your billing process making complicated modern American life a little easier by having just one insurance professional to call instead of two or three.

4. Install an electronic security system in your home and consider Central monitoring stations. Most of us are familiar with the generic security systems that are associated with burglar-proofing a home. This is considered a good edge of protection by the insurance companies. More obscure would be central monitoring systems that some of the same security hardware may function as to shut off the water if a leak is detected while the homeowner is not there, or raise the temperature in the water pipes to avoid freezing pipes. Also, Make sure if you live in a gated community that this is reflected in your payment. Gated communities are considered a better and safer risk by insurance companies, too.

5. Disaster Preparedness. Although we have not seen hurricanes in Southern California(yet). Storm shutters and shatter proof glass can help reduce premiums. Question: With modern Earth changes. If hurricanes do hit Baja California, and they do, then why couldn't they hit San Diego, Los Angeles or Orange Counties?

Long Beach, Ca. Finally, an honest Economist

Prudential California Realty/Bristol Home Loans — Fri, 23 May 2008 23:50:23 -0500

Long Beach, Ca. Finally, Dave Avery, an honest real estate economist and head of the Los Angeles Economic Development Commission, discusses the State of Southern California Real Estate. Mr. Avery, recently gave an address on the way things are moving at the Income Property Lending Conference in Long Beach, California. In regard to the housing market, Mr. Avery was the first economist that I have ever heard talking about a housing "Depression."

This was refreshing since no other economist, to my knowledge, in a public forum has had the guts and fortitude to call a spade a spade, address the problem, offer some solutions, and get on with it. Mr. Avery detailed the current housing situation, and addressed the question, "How much further will prices fall?"

Between 15-20% more was his answer. Considering that since February of 2007 until April of 2008 the medium sales price in the five Counties in Southern California, including: Ventura, Los Angeles, Orange, San Bernardino, and Riverside has fallen from $505,000.00 to $375,000.00, it appears that an additional slide will be a boon for people interested in purchasing real estate.

Now, if Mr. Avery is right and the average property in Southern California goes down to between $300,000.00 and $320,000.00, it will be a great buying opportunity that only seems to come along every 15-30 years.

Consider this, that while food prices in the last year have gone up between 30% and 40%, and gasoline prices have gone up by almost 100%, that real estate is going down 20-25%. This is an amazing figure when you consider that this percentage in reduction does not include regular inflation. Remember that the government figures of 4% does is not a real number in that it does not take into account the aforementioned prices of gas and food stuffs. The truth of the matter is that the true inflation rate when these are included is between 10-15% a year. Add this inflation number to the current correction in housing prices and true prices are really off between 25% and 40% depending on what market you're in.

Also consider the fact that current interest rates for thirty year fixed rate mortgages are between 5.5%-6% and you get housing at the most affordable price in years.

Long Beach, CA. Save Beau Coup Bucks by changing your Mobile Phone Service

Prudential California Realty/Bristol Home Loans — Fri, 23 May 2008 23:27:51 -0500

Long Beach, Ca. In the current economy where Americans are strangled at the pump, squeezed in the grocery market, worried about finances, and trying to save every dime possible. It is with pleasure that I share with you how my personal family recently accrued an approximate savings of $285.00-$300.00 a month by changing our mobile phone service company.

In the old days, before mobile phones, every household had at least one hard land-line phone. Granted, if there were teenagers, an occasional second line was installed to handle the traffic. Nevertheless, telephone service was pretty straight forward:

one home+one phone=one bill.

Today in America Life, with the advent of mobile technology, mobile phones have become considered "essential." Phones are not just for talking anymore, they supply the tools for web access, photography and video, text messaging, video gaming and e mail not to mention contact management and calendar access, and emergency life line.

A simple 4" mobile phone has become a mobile Computerized World Access Portal(CWAP) and if we modify the letter "W" to an "R," we as parents can relate to what it is our children are spending their time doing with these devices besides using them for there best and most important use: Parent/Child communication. That said,

Unfortunately, the world is not as safe as it was when I was growing up and today, it is considered good parenting to make sure that your child has emergency phone access and a mobile phone is the best child locator tool. As long as it is monitored carefully, I agree with allowing youngsters access to a mobile phone, if not on a daily basis on a case by case basis. For example, if they are going on a field trip at school, a Sporting event, or some other supervised outing wherein it is convenient and smart to be able to communicate via a phone.

Meanwhile, the old formula of one home+one phone=one bill has morphed into:

one home+one phone(a land line)+internet service(DSL)+cable access+several mobile phones=multiple outrageously expensive monthly multimedia bills that can cost thousands and thousands of dollars a year.

Let's take a residential phone service at home that with taxes can cost a min. of $50-$100 a month, sometimes the DSL is provided by the same phone company, sometimes you have to pay for the internet access separately.

Cable television access that routinely runs between $50- $100 a month for a minimal plan. Again, you may be able to combine cable with hard wired internet access for an extra charge.

Then there is the litany of mobile phone service providers including: Sprint/Nextel, AT&T,Trac Phones, Cingular, Verizon, etc. Although, most of these have some type of family savings plans, I have to share with you the recent advent of Metro PCS in the Southern Californian Market Place and how it is saving my family a considerable amount of dough. Hopefully, without sounding too much like a commercial, for a limited time, Metro PCS is offering four lines with unlimited calls for $100/month. Although, the phones are limited in area coverage(not so good outside of Los Angeles, Riverside, San Bernardino, Ventura and Orange Counties, the service is inexpensive and meets most families needs.) Note that is $25/ month per phone with unlimited calling including local, text messaging, and long distance. Best of all, Metro PCS did not require my family to sign a contract.

If you are a business traveler, this system will simple not work for you. This is not as of yet, a nationwide company. The coverage is mostly local. There is no coverage as of this writing in Portland; however, Las Vegas in connected. Also, another draw back is as of today, this plan does not work with the Blackberry Phone.

The draw back for the plan is that you must pay for the phones up front and this plan does not include web access. But for $5/month more per phone you can add the web access.

Now, compare what I was recently paying at a competitor:

For unlimited web access and phone calls my old phone was $135/m.

I added a second phone for my wife which cost another $100/m.

My daughter was paying at least $50/m for her own service.

Our land line at the house is normally around $70/m.

Imagine putting out almost $400/m just to be able to communicate via mobile and home service.

This was costing us an average of $285-$300/m with taxes for just three mobile phones and an additional $70/ month for our home line! Imagine putting out almost $400/m just to be able to communicate via mobile and home service. Now, with Metro PCS's plan, we have increased the amount of mobile phones from three to four phones. We use one for my business, one for my wife, one is being used by our 17 year old daughter, which leaves a spare at the house for any of the other four younger children that might need it for a special occasion all for only $100/m.

Now, because of the unlimited long distance part of our plan,we can cut back our land line service to a more basic plan and save an additional $35/month. All together the total savings for my house hold by utilizing the Mobile PCS is between an astonishing $215/m-$250/m. Now that's a monthly savings of between $2500-$3000/year.

I see that my family members are going to be able to fill our gas tanks, after all this summer!

Finally New FHA Loan Limits Helping Home Buyers

Prudential California Realty/Bristol Home Loans — Fri, 14 Mar 2008 11:50:42 -0500

Posted on Fri Mar 14, 2008 @ 3:26 am by KMulhearn

Recently, there has been a lot of talk about how raising the FHA loan limits last week would affect us in the real estate markets.

Long Beach, Ca. Recently, there has been a lot of talk about how raising the FHA loan limits last week would affect us in the real estate markets.

Considering that in the six counties of Southern California that the average sales price in January, 2008 was $415,000.00 and that this was down from $505,000.00 back in February 2007. STOP! Did everyone just get that? Southern California home prices have come down $90,000.00 in just twelve months and currently 21% of all sales are foreclosures that have been resold into the marketplace.

Clearly, this downward pressure on the real estate prices and with real inflation spiraling into the double digits coupled with the price of sweet crude rising from $100 a barrel to $109 a barrel in the course of just one week, referred to as the, "economic shot not heard around the world," because it was not given the attention that it should have had in the major news networks. We see our economy nose diving in a manner never seen by the vast majority of fun loving Americans. Without sounding histrionic, perhaps this is the time to ask our grandparents what it was like to live through the Great Depression. One thing for certain, all of our lives are dynamically being effected.

To read more, please go to:

http://www.longbeachrealestateandloans.com/

Watch out!!! Is Bank of America Credit Card Debt the next big American Financial Meltdown after the subprime debacle???

Prudential California Realty/Bristol Home Loans — Fri, 08 Feb 2008 23:00:07 -0600

Long Beach, Ca. Today I was informed that Bank of America has arbitrarily decided to charge good customers higher interest rates because of falling FICO scores. This is an extremely serious situation which could effect thousands of good credit card borrowers. Please read: The Credit Card that you might want to toss.

We as good borrowers have to ask ourselves: What the heck is going on? Why on earth would Bank of America or any other credit card lenders punish good clients? Nortorious Mortgage Bankers take your gloves off and fight!

It is obvious that the accountants in the Bank of America credit card division are searching for some way to shore up massive losses. Perhaps this if from their lending division gone South shocked at the massve losses Countrywide is forecasting???. Remember late last year when Bank of America cut out all the Mortgage Brokers that had supported them for over twenty years?

What ever the reason. Bank of America needs to remember one thing, customer service. If it is lacking, borrowers will flock to greener pastures and dump them like faster then they can raise their interest rates. Perhaps borrowers will just refuse to pay any credit card debt at all and let their credit card obligations just slip away into credit card collection heaven. Remember, collections are only collectable for seven years...

How about massive borrower defaults wherein everyone everywhere decides suddenly that they no longer will pay the money changers? What kind of world would that be? Perhaps we would have to revert back to the old barter system of economic trade, perhaps that is more wholesome and healthy....Whatever American consumers decide to do, I'm sure, no matter what the interest rate, that they will only be able to pay as much as they can. Let's face it, food and shelter comes first...

Has anyone out there actually brokered an REO Bulk Sale???

Prudential California Realty/Bristol Home Loans — Fri, 08 Feb 2008 12:08:31 -0600

Long Beach, Ca. Every since the middle of last year, I have had countless brokers calling me trying to either off REO bulk packages or attempting to buy them. I would like to know if anyone of us 70000+ members have had any closings in regard to this market trend. I don't know about the rest of the Country but in my office, out of the last 15 sales, half have been either short sales or REO properties!!

See attached letter from a personal friend, I would like any comments or observations, thanks, ktm

Hi Kirk:

Good Morning! Okay, we are finally ready to go with the REO's/notes and are working directly through a contact who has lead us to a trader with Bear Stearns for note product. It is a tremendous connection. I am currently awaiting the step by step process they want us to follow and completion of a note ordering form today.

Also I had a separate call yesterday with a firm that has been closing REO deals. They are a large, well-known loan servicing provider who is supporting several banks in offloading their product. What I learned from the principal owner of this firm is our buyers must be ready to pull the trigger at a moment's notice on REO packages, which means we need to have our buyer's educated and well prepared. The REO process is truly a "bid" process and is extremely competitive so "newbie" buyers/investors to the game will have great difficulties in securing packages if they don't know "how" the deals work and are structured so that is where we come in.

I have a follow up conference call with this gentlemen today at 1:00 p.m. and he actually has an Orange County office and other offices with 82 employees on staff nationwide to support their banks and the loan servicing. He and his firm can actually assist large buyer's with an exit strategy post purchase if they do not have a solid exit strategy in place. This is also a tremendous contact and source.

Here are the primary elements we need to "prep" our associates and buyers with if we are to be successful in securing REO's/notes as follows:

The buyer/signatory MUST be identified upfront on the initial note order form or letter of intent. The seller's must know "who" they are potentially doing business with from the start because of the U.S. Patriot Act so if we can not get past this key buyer ID disclosure issue with involved broker's/consultant's, etc., we can not move forward. Buyer ID is crucial and the first step as the seller will check their "watch" lists for certain organizations, names and parties that they are prohibited from doing business with under law. Secondary to that critical item is the new "internal" watch lists the banks have in place due to the unbelievable level of fraud occurring in the arena so the involved parties requesting product for purchase MUST be disclosed.

Basically, this means we must have full disclosure. And we must also have a cohesive team of honest, knowledgable and professional experts who can work together in harmony for the desired end result for the client's benefit. We must all be willing to play fair for everyone to win and get paid. I believe we can do that together as long as the relationship with the end buyer is strong and we are all willing to be educated on what needs to occur to be successful. This is no different than any other real estate transaction only larger and more complex. It is simple; name the players!

Realistic buyers is a must. We need to ensure we are working with buyers who clearly understand the current market and price points. Much of the frustration occurs when large buyers with deep pockets puff out their chest and demand to get to the front of the line to dictate what the seller will give them and at what price point. They want high-end everything for little or nothing. Yes, we are in a correcting real estate market but buyer's must be realistic. This type of attitude and behavior will not fly with the banks and selling sources. These types of buyers/investors will never secure product and will likely get themselves blacklisted. This is one of the "hot" topics with bankers and private sellers right now. They are sick and tired of arrogant buyers and their uneducated broker's and consultant's. As professionals we need to be able to control this issue with our buyers and professionally facilitate these transactions. That's what we get paid to do right?

Exit strategy is crucial. Buyer's MUST have a reasonable and solid exit strategy post purchase. The selling banks and private selling sources are not high on "flips" because of downline liability tied to the U.S. Patriot Act i.e. know your customer's customer comes into play. Buyer's must be prepared with a solid business plan and exit strategy period. If there are two equally qualified buyer's competing for a "bid" on a REO portfolio and one has a solid exit strategy/business plan and the other doesn't guess who is going to secure the pool? It is our responsibility as professionals to ensure our buyers understand this key issue and make sure the seller's know they can perform and handle the product once they secure inventory.

Financial performance - last but not least is necessary. The buyer's MUST have their finances in order and be able to prove it. Cash is king and cash buyer's trump buyer's that use credit. However, solid credit options with credible financial institutions i.e. warehouse lines of credit, etc., with well know banks are also strong financing options. Hard money loans from shakey lending sources for newbie buyer's will not impress the sellers and will likely lessen the buyer's chance of securing a REO or note pool.

We all must remember at the end of the day the Seller decides "who" they will do business with period. They are selling/trading their assets and they can "choose" not to do business with certain buyers, brokers and consultants. Unfortunately, the buyer's and involved parties are not in the driver's seat on this one as there are more buyer's than seller's right now. So let's all be clear on that...the seller's are in control.

Whew! That was a lot to cover but Kirk please be certain your contacts and buyers understand these basic rules of engagement so we can move forward rapidly to have a solid and prosperous future together! As I will be a major and key facilitator in these transactions (as a former 20+ year banker) we need to ensure we can all be transparent and work together again, for ALL to win!

I will be in touch with you as soon as I can so get your buyer's ready to go! I will send you the note ordering form and instructions for the REO's, which will likely be a standardized Letter of Intent (LOI) as soon as I can. Off to meetings now. Sam Perez and I will keep you posted. Make it a great day!

Thanks so much,

Kirk Timothy Mulhearn

Broker/Owner

3728 Atlantic Ave.

Long Beach, CA. 90807

Telephone: 562-989-4091 Ext. 110

Facsimile: 562-424-4580

"Excellence is not an individual act but a learned habit." Aristotle

Looks like Vlogging on the internet and building your own Wi-fi Real Estate Channel is the future

Prudential California Realty/Bristol Home Loans — Thu, 07 Feb 2008 21:26:20 -0600

Long Beach, Ca. With the recent explosion of youtube and google video, myfeedia and many others formatted video sites, it is inevitable that the real estate business seems to becoming almost a quasi- entertainment business with necessary content quickly and vastly delivered to the entire world! Check out the recent article, "Wi-Fi TV brings Internet TV to Realtors."

What are the implications to a realtor:

1. You must retrain yourself to be familiar with this new media. Fortunately, most of these systems are quite easy to learn how to use; however, the last thing you want to do is put a home made movie of your latest listing on line. In addition to learning how to film properties, realtors are going to have to learn how to edit digital footage and even add music as a way of branding oneself or company.

2. Generation X and Y expect this type of presentation. Let's face it, many of the baby boomers look at the computer as a work station designed for business, later generations look to the internet and computers as a way to socialize with friends, watch shows on line, and generally communicate. Agents that adapt to this market place faster will succeed faster. As an example of a beautifully designed broker site, check out brokeriptv.com, the graphics and colors along with the content make real estate a more and more exciting career opportunity then ever.

3. Camera shy? Get over it! This is the time to jump in with both feet. First of all, you might consider buying a decent camera that is reasonable in price. The Canon HG10 HD AVCHD HDD Camcorder hold 40 GB and can easily be manipulated to take quality footage. Hey, if you don't use it for your job, you can at least shoot your family get togethers! In my family that would mean a lot of dysfunctional but at least entertaining footage! How does that sound like for rationalization...get the plastic out, here we go again.

Senate Bill passes to Stimulate Economy, Is it too little, too late for California Real Estate?

Prudential California Realty/Bristol Home Loans — Thu, 07 Feb 2008 20:53:51 -0600

Long Beach, Ca. The United States Senate just voted in favor of passing an amended version of H.R. 5140, a $150 billion bill to jumpstart a sluggish economy through giving temporary tax breaks and raising the loan limits on conventional loans from $417,000.00 to $730,000.00. The bill also increases the size of the loans the Federal Housing Administration could insure.

Recently we wrote an article, How will higher loan limits acutally change California's real estae market?, that discussed what the effects would be if this bill passed. The question remains, "How will it affect the rest of America?"

Recently, I was in discussions with a tech friend who casually mentioned to me that the real estate market along with all of its related services only represent less then 4% of the GNP. If this is true, then the rest of the Country really is doing that bad afterall?....I don't think so.

Just start interviewing small business owners. Grant you that an extra $700-$1000 would be great to have in cash back from the government, but is this amount really going to effect the way America's true economic state. Let's admit to the fact that the average household is spending between $200-$400 a month on gasoline alone in Long Beach, California. Now add the fact that groceries are running a typical family between $500-$1000 a month. This tax rebate would definately help but seems to resemble more of a band aid rather then a cure to our current economical malaise...

USC or NFL coming to Long Beach California?

Prudential California Realty/Bristol Home Loans — Sun, 03 Feb 2008 12:27:18 -0600

Long Beach, Ca. Finally we sport fans have something "interesting to look forward to" regarding sport franchising and stadium building in Downtown Long Beach. After too many years, Long Beach has finally been offered up to the boards of both USC and NFL. Jeff Klein who just bought a 65 acre lease of the property next to the Queen Mary has made a daring and timely presentation to both of the aforementioned sports syndicates.

Being that I'm a proud grad of USC myself, I can tell you that this idea is profound. First of all, apparently, I'm like one of the only Trojan fans that actually likes to go to the Los Angeles Coliseum. I love the graceful old facility there. It reminds me of younger days when I was a student there and everything was possible! It is fun to go back to that smelly part of Los Angeles; Ok, maybe because I know that I'm only going to be there for four hours....

On the other hand, having a new Colliseum in Downtown Long Beach is ex-tremely desirable. Let's face it, it really would be one of the most colorful and scenic stadiums in the entire Country, just as long as they leave it open to the elements and don't close it off from the beautiful and scenic views of Catalina Island, the grand old Queen herself, and the beautiful vistas of downtown.

As far as the NFL is concerned, I also feel that since we Southern Californians lost the Rams and Raiders that there has been a gaping hole of emptiness for the lover of our traditional National Blood Sport and all. Of course, there is no money form the City Coffers available to shore up a team, but I do believe that Long Beach woud be a fantastic venue for any professional sports team.

What if...

Long Beach lot could turn into great beachfront lot for NFL, USC

Long Beach, Ca. How will higher loan limits actually change California's Real Estate Market?

Prudential California Realty/Bristol Home Loans — Sun, 03 Feb 2008 11:53:37 -0600

Long Beach, Ca. The big debate in Congress right now is not whether to raise loan limits for fannie mae/freddie mac but how much to raise them. You see if the new bill passes, the new loan limit will be for 125% of the median sales price in a community. For example, In Orange County, California, the average sales price is $565,000.00; therefore, the new conforming loan limit would be $706,250.00

1). Home-buyers will be able to get better interest rates for purchases and refinances. This is because the current jumbo interest rate (for loans above $417,000.00) is between .5 and 1% above the conforming loan rate and that can make a big difference on a $400 to $500 a month.

2). Most property owners that currently have jumbo loans(more then $417,000) will attempt to refinance to lower their rates. Bond traders say that such refinancing would mean that bondholders and investors would get their money back, but then have to reinvest at lower rates, this will create demanding pressure to get higher returns and compensate for

3). Borrowers will more options. First time home buyers will be able to reach higher to purchase their first home. Interestingly, you might say that the new law will only help the affluent family base in Southern California; that is, it will help the families that don't really need any help who already have good mortgages, good credit and lots of reserves. After-all, who needs a $700,000.00 loan anyway?

Another side note: If something is not done to shore up the mortgage industry, there are going to be fewer and fewer lenders to choose from because many have already gone out of business. If something is not done quickly there is going to be a landslide of mortgage brokers leaving this industry.

The plan to raise the loan limits in currently being reviewed by the Senators, of which, several feel that the government has already taken on too much risk considering that these quasi government agencies are the only real big players purchasing loans right now.

The pressure is on for the government to do something quick considering the fact that there are currently approximately 1.25 million foreclosures in the United States with California having over 400,000 of those foreclosures.

Long Beach, Ca. What is positive cash flow after a Short Sale!!!

Prudential California Realty/Bristol Home Loans — Sat, 26 Jan 2008 00:11:54 -0600

Long Beach, Ca. For years it has almost been impossible to find an investment property in the Golden State of California that is has a positive cash flow; that is, after a reasonable down payment, getting more money from the difference of your gross collected rents minus management and utilities and mortgage payment. Sorry, but it has been so long in California since we have seen this that I have to re-define, " positive cash-flow."

Recently, as the slew of foreclosures and short sales have hit the market, this is beginning to change and for the first time in 10 years, investors are beginning to find investment properties that make good investment sense.

Last night I met a real estate investor who took me to see a duplex that an he had purchased 18 months ago in a nice part of Long Beach, specifically the Sleepy Hollow area. Needless to say, he purchased it at the top of the market and he had over $650,000.00 in loans on the property. Now to understand this dynamic, you have to realize that with a loan of that caliber, that you have mortgage payments of approximately $5000.00 a month. I know this sounds crazy but the two units are only renting for $1750.00 a piece or $3500.00 a month.

This is a negative cash flow of over $1500.00/m and is a true example of how crazy things got when credit was cheap and appraisals were based on low interest rates.

So the investor discusses the matter with me and we decide to list the property utilizing the short sale method. Now, to explain the short sale process concisely, it is the method of selling real estate for less money then what is owed to the bank. The bank agrees to take less because it does not want another foreclosure on its books.

Ultimately, what has happened in the mortgage markets is a great tightening of credit because the banks are all jittery about going out of business. For those of us who have been in the real estate business for more then 15 years, it feels like the mid-nineties all over again.

The bottom line is that real estate can only currently be sold for what is actually worth.

In our case, the duplex will be listed for between $417000.00-$450,000.00. The reason is because it is the only possilbly way to make financial sense. Let's say we find a buyer out there that actually has 3% to put down, the new loan amount will be for approximately $400,000.00 @ a 6% interest rate, the 30 year fixed mortgage payment will be $2400.00 a month plue approximately $600m in taxes and insurance the new payment will be about $3000.00/month. Assuming the property is initially owner occupied, the second unit will generat $1750.00 a month and the new owner will only have to come up with $1250.00/m to live in one of the units. If at a later date, the new buyer decides to leave the property, he can rent out both units for $1750.00/m and have $3500.00 a month coming in. This would give the proud investor a positive cash flow of $500.00 a month. Now that is great news!!! Amen.

In summary, we are now rolling back prices so that they finally start to make sense for both the bank and the buyer.