The loan modification business must be the only booming industry right now. Unfortunately it's out of control. I believe in the concept of banks working with borrowers to help them stay in their home but these hard times have opened the floodgates to many vultures.

These people are generally the same people that helped put many borrowers into option arm loans. Option arm loans were loans that paid up to 3% rebates and to the mortgage broker and it gave borrowers 4 payment options. The options were a 15 year amortized payment, 30 year amortized payment, interest only payment, and a negative amortization payment. Guess which payment most borrowers chose? Ding ding ding, you guessed it the negative amortization cause it was the smaller payment. This type of borrowing inflated prices and put many people in a home that they normally could not afford.

Now these same people are charging borrowers up front fees to "save their home". If you go to http://www.hud.gov you can click on the programs offered by HUD to modify loans. Yes these programs are difficult and there's a lot of running around that one has to do but you are asking a lender to modify a contract that you agreed to. Yes some people would rather pay upfront to get this done but then they risk dealing with a company that might be a little shady. Many of these companies claim to have an attorney represent you but they actually are an assembly line of people using the name of an attorney in case anyone wants to know. 

I am not against companies getting paid upfront fees for offering a service but since we do pay taxes for a Department of Real Estate (DRE) than I want them to protect the borrowers. I always say that the government's priority is our defense and to protect us from fraud. People now are so desperate that they are willing to pay almost anyone with a good sales pitch. The DRE needs to start cracking down on these companies and make a list of service providers that have proven to be on the up and up. They could all start by getting licensed by the DRE and making sure all of its representatives are licensed.

The people of California need the DRE to be proactive and we as real estate agents need to continue to reach out and let these borrowers know that they have options.

To all the wonderful mothers, grandmothers, aunties, and anyone else who helps fill the role. Mothers are the foundation of many families. They provide strength, support, sensitivity, and let's not forget good meals. We take one day out of the year to honor them but they deserve to be honored everyday. My own mother, Miriam Villagran, is one of the strongest women I know. I look at her for inspiration because she is like the Energizer Bunny and just keeps going.   

In all honesty I had lost my faith in the new generation of moms because of my own experience w/ my kids' mom 8 years ago. I thought most young moms were selfish and didn't think about the overall well being of their family. Keep in mind I was not as social as I am now and I was working in accounting for a small business. Basically I was in my own little world. We all hear the old saying that things happen for a reason and what has happened to myself and the kids has opened up our world.

Being a single father I was forced to make decisions that would create a better balance for the kids and I. I now had to try to attend as many of their events as possible and continue to bring in income without fearing losing my job for asking for all the extra time off.  This is how I came into real estate over 4 years ago. It was a perfect fit for my financial background and it allowed me more flexibility so that I can be active w/ the kids. Most importantly I had a lot of friends step up and help me. My close girlfriends are like aunties to my kids and they play such an important role, especially with my daughter. Because of these women my kids are really well balanced.

My career in real estate has forced me to meet a lot of new and old friends. I once was uncomfortable with social networking and if you are a friend on facebook that statement will shock you.  What I love about these friendships is that it restored my faith in women. You women are great mothers. Yes I mean all of you even if you don't have your own kids yet. Children look at you for strenght and sensitivity and yes sometimes the men do too. You are able to balance your lives a lot better than men ever could. I am so happy to see many old friends that now have their own beautiful families and are doing such great jobs at raising their children.

Mother's Day is just the day that is dedicated to you on the calendar but remember that everyday is Mother's Day and your role in our lives is very much appreciated.

Happy Mother's Day!!!

This will be the first of a multi-part series on getting ready to buy your first home. As I continue to meet new prospects and people who have never tried to buy a home I'm amazed at how necessary it is for us as Realtors to educate our clients. This education is key to not only get them in their first home but to keep this home.  I am usually asked what is needed from them to buy. I can go into getting pre-qualified first and knowing your credit score but I was thinking about this more and I realized that pre-qualification is not the first step. Let's face it we just passed a cycle where a good credit score could have gotten you any loan and finally it has tightened up. So what is the first step?

The first step should be to establish a budget. I do not mean just come up with a figure in your head and say well I can afford so and so amount. I mean actually sit down and figure out all of your income sources and your expenses. So many times I saw people go from renting for $1000 a month to a mortgage of $3000 because they thought that is what they could afford. I think many people were blinded by the increase in values that they thought they were willing to sacrifice enough to make that mortgage. Once values dropped then so did the sacrificing and they walked away. The truth is that if you can afford an increase in monthly payments of $2000 then you should be able to show that you are saving $2000 per month in either a savings account or other investment vehicle.

A budget will help you find where your money seems to be disappearing. For many it's a wake up call and they either realize that they eat out too much, buy too much gourmet coffee, or even pay too much in ATM fees.  Once you have a budget and have made the necessary adjustments to your lifestyle then you will see how much disposable income is left. Set up an emergency fund that covers about 3 to 6 months of living expenses. Once you can do that you are ready to start looking into buying your first home.

Next we'll cover paying down your debts and increasing your FICO score while working w/ a reputable lender.

Just wanted to remind everyone that the home buyers tax credit to purchase a home in 2009 can be claimed on this year's tax returns. If you have already filed you can always amend your taxes. This is a refundable tax credit up to $8000. Call me for more information at 818-416-7511, leave a comment here, or email me @ mario@usspaces.com.

So President Obama says that AIG represents inappropriate use of tax money. This is just like me giving the homeless guy off the freeway off ramp with a sign "need money for booze" some money and getting mad cause he bought some booze. We knew that these guys were unethical before the first bailout and then they threw a huge party and we continued to give them money.

Mr. President the true inappropriate use of tax money is how our politicians just continue to hand it out and reward bad behavior. Yes it is true that he has inherited this problem but now that you are in charge please listen to the American people and let us get back to a free market. Our government is responsible for protecting us from fraud and prosecuting those that defraud us. Instead of prosecuting we just keep giving them a check.

We complain that we are at a disadvantage when it comes to trade. When they have these G20 conferences what is it that they talk about? Are they not trying to even up the playing field? We just did the same thing that we complain other governments do and subsidized an industry. We need to lead by example and let the free market take its course.

Listen to the American taxpayers. We believe in the United States and we know that we will rebound. We believe in taking risks and learning from our mistakes. We do not believe in our hard earned money being used to reward failure. The only ones benefiting from these bailouts are the highest income earners. I thought the democrats platform was based on helping the middle class and yet the middle class is about to pay the biggest price.

Just read through my CA Real Estate Magazine and read that penalties for non-licensees is $20k and/or 6 months in a county jail. A corporation is subject to a fine of $60k. I wish they would offer a reward cause I could probably make a living reporting all these people that are required to have a license but for some reason will not get licensed. http://www2.dre.ca.gov/PublicASP/pplinfo.asp

When dealing in real estate matters please make sure that the person you are dealing with is licensed. First of all it is not that hard to get licensed so you have to ask yourself why one would not get licensed. Second of all licensing is one way that the Department of Real Estate tries to protect the general public. If you are interested in this law look up California Business & Professions Code Section 10139.

Well it's that time of the year again. The fifth season that everyone dreads, tax season. We begin to gather up all the statements that we have received and some us even begin to dig up receipts and question what we can write-off. Are those Adidas I bought a write-off? I am sure everyone knows at least one person who thinks they can write off personal items. The only personal item, that I could think of, that can be used as a tax shelter is your home.

The home itself is not a tax write-off but the mortgage interest and property taxes associated with the home are tax write-offs. This tax season take the time to sit down with your tax preparer and ask how you can benefit from paying mortgage interest instead of rent. The low prices of homes now has made homes affordable once again and in some cases you can have a mortgage for less than what you pay for rent. This is a case by case basis so please do not write me to tell me that there is no way that you are going to move out of an apartment in West Los Angeles and find a home in the same area with a mortgage payment that is equivalent, of course not you have to find a home in another area. Do not get caught up in getting your taxes done and then focusing on how much you are getting back but focus on how much you paid total. So many times I hear someone tell me that they have a refund of $4000 coming to them and when I ask well how much did you pay total, they do not know. They could have had $20k deducted from their check and do not realize that they actually paid $16k in taxes. Also ask about the federal housing tax credit. You can also get more information at http://www.federalhousingtaxcredit.com/faq.php.

For those of you who have stuck it out in your homes and are looking for even more tax shelters, consider the tax credits that are available for making your home more energy efficient. You can visit http://www.energystar.gov/ for a list of these credits. During these tough economic times you can also take advantage of cheaper labor and more competitive pricing.

Remember if you do not have the kind of tax preparer that will talk to you then switch. There are plenty of CPA's and financial advisors that would be more than happy to sit and talk with you. Final note, these are just suggestions. I am not a CPA or licensed financial advisor. My real estate license does not make me a professional in those fields so please consult with a licensed professional. Feel free to call me if you need a referral cause that I can do and after years of networking I have a few good ones up my sleeve or on my pda.

I am watching the news and the banks are dominating the headlines. The banks keep losing money and keep asking the government for more of our tax dollars. They continue to make bad decisions and we continue to pay for it. I am not sure when society made it more acceptable to ask for welfare but in my opinion it is an epidemic that will lead to socialism and/or nationalization. Maybe it was how I was raised but I am not that old. Might be a trend that has been happening year after year and really picks up steam during recessions.

We keep assuming that if the financial industry collapses then we end up in total chaos. The assumption is that if a company or bank fail then nobody replaces them. Basic economics teaches us that if there is a demand there will be a supplier of goods or services. When the supplier is willing to supply a good or service at the price that the consumer is willing to pay then we have market equilibrium. I'm sure that banking is profitable enough for a new supplier to appear and take over the large demand that will exist if these companies fail. The government is trying to protect themselves by throwing money at the problem without any guarantees. Why do these banks continue to buy other banks if all the assets are considered toxic? Why do these private banks run to the government for help instead of restructuring and making sure these loans perform. They after all made these loans because they abandoned traditional underwriting standards in order to keep up with every other lender that was making these ridiculous loans. When sub-prime lenders rapidly pulled their programs in August of 2007 the markets downturn picked up a rapid pace. Do these CEO's automatically assume that they are going to get bailed out. What ever happened to having some pride in running a successful company instead of waiting to get fired so that they can collect on their golden parachute.

The government pumping our tax dollars has done nothing but allowed companies like AIG to continue to have extravagant parties for their terrible executives. I would love to make a million dollars to run a company into the ground but guilt will drive me crazy. We need to allow the natural business cycle to take place and not try to incorporate corporate welfare. If banks and lenders would have started to work out modifications from the beginning we would not have entered into such a mess because more families could have afforded to stay in their home and we would not see as many foreclosures flooding the market. Sure people will argue that the foreclosure rate was higher on modified loans in the first quarter of 2007 but that's because they continued to allow foreclosures to hit the market and so those with modified loans still did not have principal reductions that allowed them to see that they might be able to absorb the loss in equity. From my experience the banks have been unwilling participants and I think it is because they are dependent on getting some of our taxes. If we cut off their funding then they will do whatever it takes to keep those loans performing and we will see a decrease in foreclosures.

Dear Mr. Obama,

Congratulations on a well run and successful campaign. Your campaign persevered and got your message of hope and change through to the American people. My ideology is not in line with yours or your party but obviously it is with the majority of Americans. What I do see in you is a man that has the ability of bringing people together and I hope you are successful at reaching across the aisle and making your administration an inclusive one. The economy and war that you will inherit is going to be a challenge for your administration. The country is looking to you to get us out of this recession and to bring our men and women home. As commander in chief I am sure that you will come up with a withdrawal plan that will allow us to claim victory and see a more stable Iraq. Judging from the reactions to your victory I believe that the American people are already feeling more confident and we'll probably start seeing a jump in our consumer confidence index.

This was a very historic election. The two campaigns brought out voters in record numbers. I am so happy to see that people took advantage of their right to vote. I don't like talking about discrimination because I feel that our country is a lot further ahead of our shady past than what we are given credit for but your election as the first African-American president has confirmed that. You, Governor Palin, and Senator Clinton have shown the world that the United States is continuing to move forward. I hope this progression eventually results in no more hyphenated Americans. Boys and girls from different backgrounds all have hope of one day becoming President of the United States.

I hope that one of the lessons you will take from our outgoing president is that you can not continue to increase spending. Tax cuts work when you also cut spending. People are tired of these executives that make millions of dollars getting bailed out. Any economist will tell you that if there is demand then you will find someone willing to supply at a market price. If a company fails then another company will snatch up its assets and continue to supply the demand.

Early on in your campaign you spoke of personal responsibility. This is a term that I did not associate with your party. Your party loves social programs which just creates bigger government and inefficient practices. I believe in charity and giving people a chance but lets leave that up to our churches and non-profits who can do this more efficiently than the government. You yourself have proven that if you work hard in this country that the opportunities will present themselves.

One last item that did not sit well with me is when you spoke about your position on pro-choice. You mentioned that you would raise your girls with morals and values but if they made a mistake you would not want them to suffer the consequence of that mistake. This is what personal responsibility is all about. There are consequences to our actions and we must pay the price. This is what makes us grow as human beings. We were not given a "do over" button in the form of abortion. I am a single father and both my children were not planned. I have come to believe that my life has been planned by my God and those two children are the best thing that ever happened to me. Am I paying the price, of course but it has made me a better person. Will I teach them to be irresponsible how I was, of course not. I too plan to teach them morals and values but if my son or daughter do have an unplanned pregnancy then they will have to pay the price and in the end they will discover for themselves that the price is worth it.

Mr. Obama I wish you a lot of success during your presidency and I will keep you and your family in my prayers.

Sincerely,

Mario Villagran

I will make this disclosure first, I am an independent and I find myself more in line with the libertarian party. I agree with Larry Elder when he says that there is not much difference between the two parties. I also would like to recommend that people read two books by Larry Elder, "Showdown" and "The Ten Things You Can't Say in America".

With that being said I feel both candidates are very similar when it comes to policies. They both came out and supported this bailout plan which is going to cost billions. Where does this money come from? Yes you guessed it, it comes from our taxes. The market will always correct itself but we come from a society that is always looking for the quick fix. The other day I heard an economist say that we are still paying for FDR's "New Deal" and now they are talking about a "New Deal 2". Many economist argue that government involvement actually prolongs the recovery process. I believe it because the government is trying to get involved in price fixing. Prices were too high and now they are coming down to what the market can really support.

Many of our crashes if not all were driven by greed. Greed in a lot of ways is like Love, because they both blind us from making rational decisions. The Great Depression happened only after a market run that inflated stock prices. People were purchasing stocks with borrowed money and when the market turned south they just didn't have the money to meet the margin calls. This sounds very familiar to the present housing crisis we are having. People started to buy homes with no money down thinking that the market was never going to stop going up. When some of these lenders started to demand that people make more than the negative amortization payment then they walked away from their homes. Then came the snowball effect and it is getting so bad that even people who invested large sums of money are beginning to walk away.

I was convinced to vote for the libertarian candidate and I still might because I just can't bring myself to vote for either one of the candidates because they are both about spending and taxing. I do believe that the McCain camp has it right by saying they should continue to cut taxes and reduce spending but the support of the bailout proved that he is willing to jump on the bandwagon just like everyone else and support misappropriation of funds. Let's face it not one of these executives of these financial institutions is going to reduce their salaries or bonuses in what could be perceived as one of the worst years in regards to performance.

Senator Obama is a very likable individual. He is very elegant and presidential. The message his camp is sending is for change and hope. What has he really done that convinces me that he can offer change for the better and hope that we are not attacked again. Will terrorists find a way to establish cells in the U.S. with a president that welcomes them with open arms. We will continue to be a target to terrorist governments that oppose democracy. We have a system that works but we are slowly moving our democratic and capitalist country to a socialist one. We have to get rid of our progressive tax system and reduce taxes all around to encourage investment and spending. This is how a market corrects itself.

Our president is commander in chief first and our country's job is to protect us. I would rather take that fight over there and help those people establish their own democracies so that we can have a friendlier global environment. President Bush is a man that the media and everyone else loves to hate but we have not been attacked since 9/11. He has done a great job at spreading democracy overseas but some of his biggest mistakes were out of control spending and encouraging sub-prime lending. We were entering a recession when he first took office and reducing taxes created a recovery but business cycles have to take their course and eventually the recession would find it's way back.

My point is that either candidate will have a very tough first term. I am sure that confidence levels will go up with whoever wins because people have lost their faith with the current president. I will vote libertarian because I believe that this is the next party that will eventually get this country back on the right track. It will not happen overnight but it has to begin somewhere. We need to get back to the fundamentals and what our founding fathers intended for this country and we need to get away from big government. I will pray for both candidates and I will support my new president but I would like to encourage everyone to read and research on your own and let your voice be heard. This is our personal responsibility.

If Senator McCain can actually reduce taxes and reduce spending then I believe he is better for our country. Senator Obama's plan of giving taxes back to middle income people is flawed because the majority of taxes is paid by the top 10% income earners. We should really abolish the IRS and our progressive tax system.