A funny joke about the Great One

Mortgage Market Update for 2/25/09

Mortgage Market Update for 02/18/09

Mortgage Market Update 1/16/09

10 Reasons Real Estate Buyers Want to Low Ball, Steal the House, and Stick It to the Seller

What is the biggest misconception in the mind of the guy about to make an offer on a house? 

1. This seller must be absolutely desperate to sell this house.
2. I will ignore the asking price, because all houses are priced with plenty of negotiating room.
3. Sellers expect low ball offers in this market.
4. Any seller would be lucky to have me buy their house.
5. It can't be a good buy unless I am able to steal the house.
6. If this offer doesn't go through, I'll just keep on low balling until I get another house.
7. I am a brilliant negotiator.
8. If the seller won't take this offer, I will walk away for a few weeks and let them stew until they do.
9. No one else would want this house, anyway.
   
10. No one pays full price in this market unless they are stupid.

The sorry state of our economy and the desperation of the retail world have combined to brainwash our clients about buying real estate. Somewhere along the way, "stealing the house" and "winning the negotiations"  became more important than landing the best house in the best location at a price you can afford.

Extreme bargain hunting has become a national addiction, and it is spilling over into the real estate industry.

When EVERYTHING we buy from automobiles to clothes is marked down 50% or more, has a coupon attached for a further discount, and comes along with freebies on the side, is it any wonder buyers of real estate have developed an attitude of EXTREME superiority, believing sellers are mere beggars?

Can you see how they have been conditioned to believe that as a buyer, they can call all the shots, no matter how ridiculous?

Many think those beggar sellers must be thinking this:. "Please, buy my house. I am desperate, you know, and expecting your ridiculous offer".

And you know what they say,  beggars can't be choosers.  And so the stuggle to convince buyers that a house, ANY house, is priced "right" continues.

Here's a news flash: beggars may not be able to be choosers, but losers can sure be snoozers.

Buyers should ask themselves this: Am I willing to risk losing the house I love because I am addicted to scoring an extreme bargain?

Isn't getting the BEST HOUSE in your LOCATION OF CHOICE at a hugely deflated price enough of a high? 

Or has extreme bargain shopping become like a drug addiction? You will sacrifice your long term well-being and logical thinking for that 10 minute high of feeling ever so smart because you "stole" the house?

Before you smile just thinking about how to make the seller squirm, remember this:

There is just that one piece of real estate in the whole world. That is what makes a house different from buying a car or a sweater.

Remember these things too: You cannot return it. You can sell it, but the cost of doing so will probably be far more than any savings from your extreme bargain.

Then get your priorities straight. It is about getting the house. Not getting the extreme bargain you can brag about at your next party. That feeling of superiority will last what? For a few days?

Getting the right house can give you a lifetime of pleasure and satisfaction. Even if you pay full price, you will look back and be amazed at the EXTREME BARGAIN these economic times served you up on a silver platter.

Want to know another secret? Sellers are not nearly as desperate as you think.

 

Written by Janet Guilbault, Mortgage Lending Expert Based Out of the San Francisco Bay Area

 

 

Mortgage Market Update 01/07/2009

Mortgage Market Update 12/15/08

The True Meaning of the 12 Days of Christmas

 

There is one Christmas Carol that has always baffles us. What in the world do leaping lords, French hens, swimming swans, and especially the partridge who won't come out of the pear tree have to do with Christmas?

 

From 1558 until 1829, Roman Catholics in England were not permitted to practice their faith openly. Someone during that era wrote this carol as a catechism song for young Catholics. 
It has two levels of meaning: the surface meaning plus a hidden meaning known only to members of their church. Each element in the carol has a code word for a religious reality which the children could remember.

 

The partridge in a pear tree was Jesus Christ.

 

-Two turtle doves were the Old and New Testaments. 

-Three French hens stood for faith, hope and love. 

-The four calling birds were the four gospels of Matthew, Mark, Luke & John. 

-The five golden rings recalled the Torah or Law, the first five books of the Old Testament. 

-The six geese a-laying stood for the six days of creation. 

-Seven swans a-swimming represented the sevenfold gifts of the Holy Spirit--Prophesy, Serving, Teaching, Exhortation, Contribution, Leadership and Mercy. 

-The eight maids a-milking were the eight beatitudes. 

-Nine ladies dancing were the nine fruits of the Holy Spirit--Love, Joy, Peace, Patience, Kindness, Goodness, Faithfulness, Gentleness and Self-Control. 

-The ten lords a-leaping were the ten commandments. 

-The eleven pipers piping stood for the eleven faithful disciples. 

-The twelve drummers drumming symbolized the twelve points of belief in the Apostles' Creed.

So there is your history for today. This knowledge was shared with me and I found it interesting and enlightening and now you know how that strange song became a Christmas Carol...so pass it on if you wish.'

Merry (Twelve Days of) Christmas Everyone 

 

 

The Consumer Benefits of Solid Professional Relationships

If you have been paying attention, mortgage rates are great right now.  Several days this week you could have locked a rate below 5%, depending on your scenario.  We haven't seen rates like this in several years. 

So who benefits from these low rates?  This article is not going to get into FICO scores and loan-to-values.  The people who benefit from low rates are primarily clients who have a solid working relationship with a mortgage professional.  Consider this scenario ...

1. 9:45am: Ratesheets show great pricing on mortgage rates.  Loan officer (L.O.) calls clients that could benefit from these low rates.
2. 11:15am: Client calls L.O. back to ask questions.  L.O. is on the phone.
3. 12:03: L.O. calls client back.  Client is out to lunch.
4. 1:10: Client calls L.O. back.  L.O. is in a meeting with a new client for the next hour and a half.
5. 2:50: Loan Officer calls client back, and finally gets client on the phone.  At this point, the market hasn't done well on the day and rates go up .25%.  Rates change daily, even several times a day.  In this scenario, EVERYONE loses.

So how can this be avoided?  By having a working relationship with the professionals you surround yourself with, in this case a mortgage professional. Imagine the same scenario above, BUT for each client that the loan officer is working with, there is a target rate/points scenario designated, so that the moment the ratesheet allows, the loan is locked in, in a matter of a few minutes.  Who wins then?  EVERYONE. 

There are a few reasons why this scenario isn't more common.  One reason could be that the client doesn't trust the loan officer enough to "commit" to this scenario, even though it is 100% free.  Another reason could be that the loan officer doesn't have this ideal scenario anywhere in his mind, so a pre-emptive strike would be impossible. The relationship in this case can only hope to get lucky.  It has been shown countless times that when the media reports low mortgage rates, it is almost always to late for the consumer to benefit.  Rates have already gone up to where it isn't beneficial to the consumer.

Mortgage professionals are just like realtors, lawyers, accountants, financial planners, etc ... there are tons of mediocre ones out there, some bad, and some really good ones.  Having a network of your own professionals, even as a regular 'ole Joe from Anytown, USA, you can bring about much more financial success for yourself.  By working with such professionals, you create a scenario where financial success for you isn't a flip of the coin.  It is a predetermined decision. It isn't a question of if the right scenario will come about, it is a question of, "Am I ready for that scenario at the drop of a hat?"

by Steve Kappre

Steve Kappre is a Certified Mortgage Planner in New Jersey and can be reached for more information at 856-419-3561 or via his Mortgage Website.

 

Quick Tips - Are 4.5% Home Loan Rates Possible?

 

Joe Farro Certified Mortgage Planner Phone: (678)289-6600 (800)613-0650 Fax: (678)289-6601 jfarro@joefarro.com www.premiercapitalmortgage.com                                                                        4.5% Rates Possible? The news is abuzz about the Treasury lowering home loan rates to 4.5% to stem the foreclosure crisis but details have been lacking. The Treasury Department stated it is looking for additional ways to help the struggling housing industry and believes lower rates are needed. This idea is similar to the November 26th announcement from the Federal Reserve where they indicated the intent to purchase up to $500 billion in mortgage-backed securities from Fannie Mae, Freddie Mac and Ginnie Mae. In addition they would buy another $100 billion in direct debt issued by those firms. The November news caused bond prices to spike higher and forced mortgage rates lower. Just like any commodity, whenever tremendous buying interest exists, prices rise. Mortgage rates fell almost 1/2% in rate following the announcement. However, the following week market forces continued and rates spiked a bit higher from the recent lows. It is important to remember that there are no details to the Treasury plan as of yet. The Federal Government does not directly dictate home loan rates. Rates are determined by price movements of Mortgage Backed Securities (MBS), which compete for investor funds in the open market. The Treasury can buy mortgage bonds on the open market but remember that they are not the only entity buying and selling these instruments. The Treasury is in a very tough position in trying to manipulate home loan rates. Creating a new Federal mortgage program could be very risky. How would rates be set, who would qualify, and can the funds be used for purchases and refinances are just some of the questions being asked. The other critical concern is implementing such a program without destroying the current mortgage securities market. Doing so could have the unintended consequence of causing additional economic turmoil. Rates are not going to 4.5% with the wave of a wand by Hank Paulson or Ben Bernanke. As a matter of fact, the massive borrowing to fund the TARP program has a negative effect on rates. At this time, the announcement still leaves a lot of uncertainty. What we do know is that rates are at historic lows and house prices have moderated setting up a great scenario for people who need to refinance or are looking to buy a home. Waiting for rates to fall to 4.5% may leave people sorely disappointed.  Take advantage of the great opportunities today

Joe Farro Certified Mortgage Planner Premier Capital Mortgage