Real Estate Market Trends

This Realtor Doesn't Agree With The Tax Credit

Mario Villagran, MBA, Realtor (U.S. Spaces) — Thu, 29 Oct 2009 16:04:07 -0500

Yes you heard it right. If I'm not allowed to disagree w/ CAR and NAR somebody please warn me. The following is going to explain my position but I'm not going to break out any charts here. I believe in a free market and competition. Those two things create jobs, keep prices down, and create opportunities. When we as a government subsidize any industry we take away the free market influences that are used to maintain a productive and efficient industry. We also continue to reward those who can not run a successful organization. We have seen government organizations in the past become more and more inefficient and we have recently witnessed financial executives laugh at in the face of the taxpayer and use our tax money to pay out bonuses that were not earned or deserved.

Let me focus on the real estate industry before I lose you. Our industry got so caught up in making everyone a homeowner that we forgot that there are instances when the market drops. Consecutive years of double digit gains was one strong sign that this might happen. The availability of money and the easy underwriting guidelines made it possible for many to purchase a home. People who never would save money all of a sudden did not have to and they were able to get into a home with no vested interest. Hindsight is 20/20 and we all know now that this was a formula for a real estate crash. Of course there wasn't any government intervention because tax revenue, spending, and homeownership rates were climbing at a fast pace. Did anybody say wait let's allow for salaries to climb before we allow prices to continue to rise? No because who needs a wage when we have the availability of credit (sarcasm). Well the banks made sure to take that away at the first signs of a downturn just creating a snowball affect that eventually turned into an avalanche. Now we have this aftermath and the government feels like it is their responsibility to spark the economy. That's what government intervention does, it sparks the economy and once the flame gets going the government is supposed to pull back but the government never does it just continues to grow and grow to the point that it's so obese it's now taking food away from its taxpayers to keep itself alive. Wait I forget that we are a country that has grown used to living on debt and our government runs the same way.

We are now very dependent on countries like China to keep on funding us. We have enslaved ourselves to the Chinese. We now have a master and servant relationship instead of two super powers co-existing. I am not saying that the Chinese are evil I just have so much pride in our own country that I would love to see us be completely independent. In my opinion it would give us a stronger foundation for our economy.

Prices had already dropped significantly and combined with low interest rates the housing market was starting to see a rebound. Many renters waited for the market to come back down but because of the tax credit they now are competing against thousands of other buyers that would not have bought. I have had buyers that continue to lose multiple bid situations because the homes are selling for market value or they are competing against all cash offers. I am sure that this is not the same in every area and some areas are harder hit then my market. For those areas that are harder hit I feel for you but the government needs to focus on job creation before they focus on increasing values of homes. I don't mean to sound like the line in "Field of Dreams" but if they create jobs the home buyers will come. In the end our government needs to figure out how to get the money paid back for the tax credit and you guessed it, Mr. and Mrs. Joe Taxpayer will have a higher bill. The higher tax bill will result in less spending which will result in company lay offs which will probably result into another recession. I apologize for the run-on sentence but the government is driving me crazy. Let's get back to the days where we were held responsible for our own actions and if we took risks and failed then the failure was really just a lesson learned. We would bounce back stronger and wiser. Lord only knows I have my fair share of mistakes but I am still plugging away.

Beware of Loan Modification Scams

Mario Villagran, MBA, Realtor (U.S. Spaces) — Thu, 29 Oct 2009 14:47:29 -0500

Once again another scam seems to have come out of this housing crisis which seems to be in recovery mode. Recently Senate Bill 94 was introduced to keep any and all companies doing loan modifications from charging an advance fee. My understanding of the bill is that companies can not charge up front fees not that companies can not continue to work on modifications for clients that had already paid. Here's a copy of the bill for you to read yourself, http://www.leginfo.ca.gov/pub/09-10/bill/sen/sb_0051-0100/sb_94_bill_20091011_chaptered.html.

Recently I learned of a company that has decided to pull the plug on clients of mine and they are blaming SB 94. They said that because of the bill the DRE does not allow them to continue to work on their customers' files and will be filing bankruptcy. Sounds fishy to me and so I thought I should share some resources with anyone who feels that they have fallen victim to this company and/or any others just like them. The company I am referring to above is Green Credit Solutions who had recently changed their name to Guardian Credit Services. When I first met with this company they seemed to be on the up and up. They were licensed w/ the DRE and they were telling brokers that they had an advanced fee agreement approved through the DRE. Clients of mine that decided to use them instead of doing it on their own like I suggested had different results. Some received modifications and others have been left out in the cold. One of them was even told to take cash for keys as part of their refund.

The DRE has published the following for people who feel that they are being scammed or have been scammed. For those of you who paid I strongly recommend getting in touch with the state's attorney general or the FBI. http://www.dre.ca.gov/pdf_docs/FraudWarningsCaDRE03_2009.pdf

Message to Buyers: Patience is a Virtue

Mario Villagran, MBA, Realtor (U.S. Spaces) — Tue, 11 Aug 2009 14:46:01 -0500

You were convinced to get off the fence and start searching to buy a home. Maybe it was even me who convinced you using the low interest rates, depreciated values, the first time homebuyer tax credit, or any combination of all three. The only problem is that thousands of other buyers were also convinced. Now the deadline for one to qualify for the tax credit is right around the corner and there isn't any certainty that a short sale will close on time and traditional and REO listings are getting multiple offers that you just can't find yourself getting the winning bid.

This experience can be very frustrating. You look for someone to blame and naturally we blame our agents. These Realtors aren't doing their job. They say they can sell a refrigerator to an Eskimo and they can't convince the seller to sell to me. As agents we understand the emotions that one can experience and we know the blame game comes with the territory. We will do our best to hold your hand through the process and educate you to what is happening in the market. As Realtors we are looking after our client's best interest first and not after our own pocketbooks. With that said let's keep in mind that we also have bills to pay and would love to get you in a home as soon as possible but we are going to guide you in making the best decision possible and not exceeding your budget or the market value of the home.

Why do we care that you stay within your budget? Let's look at the current environment. Many people exceeded what they can afford and look at what has happened to the market. Instead of consistent growth we had rapid growth with rapid decline and that has affected our economy in a negative way. People that lose their homes blame their lenders and their agents. Looking at the condition of some of these foreclosures you can tell that the previous owner took their frustration out on the house. Last thing I want as a Realtor is for this to happen to someone and for them to tell their network of friends and family that it was my fault. Those Realtors that think this way are still practicing real estate today.

Why do we talk you out of making offers above market value? If the value comes back lower than was expected than the lender is only going to lend to you based on that value. So if you really want the home you will have to tap into your savings and cover the difference. This is not advisable because any financial planner will tell you that you should have an emergency fund. Buying your new home is going to result in a lot of expenses and some impulsive ones because you noticed that one wall needs a frame and the entry way needs a vase and don't forget the new dining set. The last thing you want to do is rely on credit cards to make these purchases. The people bidding most likely have that extra cash. I don't mean to sound cliché but in this market it is true when they say, "cash is king".

I truly believe that the right house is out there for everyone. I always go back and ask more experienced people their opinion on what is happening today. Here is what I have learned. Some of our parents, most of our grandparents bought things they could afford. They were taught to save for their purchases and budget their money. They did not need a tax credit to convince them to buy. You do not want to get caught up in a bidding war just to receive that tax credit. Does it really make sense to overpay $8k plus to receive $8k. If you are financially ready to buy then a good deal will present it. If you do not make the deadline for the tax credit, that might result in buyers leaving the market and therefore you not getting into a bidding war. You might actually save more than $8k from being patient. One other thing I learned and this was from my own parents was that it took them 2 years to find their home. Mortgage interest deduction for my father did not matter cause with three boys to claim he had enough deductions on his small salary. They bought because it made sense to make a mortgage payment rather than paying someone rent. They bought when they had enough money saved up to make a decent down payment. They paid off their mortgage years ago because they lived within a budget. They are debt free and have little to worry about during retirement. My parents migrated hear from Guatemala and worked their butts off in jobs that most of us will not take but have more financial literacy than their son who has a graduate degree.

Patience will pay off so continue to work with your Realtor and if that means that you have to rent a little longer than consider it a blessing to continue to save money and get a better deal down the road.

Protect Your Children

Mario Villagran, MBA, Realtor (U.S. Spaces) — Mon, 10 Aug 2009 15:01:11 -0500

As we get ready for back to school and other activities we get a little overwhelmed. Please remember our primary focus is the safety of our kids. Please talk to your children about good touch and bad touch. Let them know that it is okay for them to talk about anything that makes them uncomfortable.

Many child predators look at volunteer jobs as a way to get closer to children. Make sure that you monitor any programs where your child is participating. Make sure these programs require criminal background checks for anyone that has access to the children. As a parent you must make sure that you have had some face to face time with any coaches and volunteers. Also make sure that there is a written policy about how to deal with the prevention of any molestation or abuse issues.

As a parent, volunteer, or teacher you must get familiar with any warning signs. It is our responsibility to report and bring forward any suspicious behavior. Here are a few that predators may use:

Always wants to be alone with children.
Too much touching.
Allows children to participate in activities that you would not allow.
Shows children pornography.
Bad language or dirty jokes around children.
Gifts to children without your permission.

If you are aware of some of these signs and participate in your children's activities you will decrease your chances of your child being a victim. Communication with your kids and communication with the people involved is crucial. I don't like to write about these types of things that scare people or set a negative tone but I hate to hear about child abuse even more. Please do all you can to keep our children safe.

DRE Where Are You?

Mario Villagran, MBA, Realtor (U.S. Spaces) — Mon, 11 May 2009 17:32:17 -0500

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.

Happy Mother's Day!

Mario Villagran, MBA, Realtor (U.S. Spaces) — Sat, 09 May 2009 10:25:01 -0500

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!!!

First Time Homebuyers: What You Need to Know (Part 1)

Mario Villagran, MBA, Realtor (U.S. Spaces) — Tue, 07 Apr 2009 17:28:21 -0500

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.

Home Buyers' Refundable Tax Credit

Mario Villagran, MBA, Realtor (U.S. Spaces) — Thu, 02 Apr 2009 18:04:24 -0500

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.

Inappropriate Use of Tax Money

Mario Villagran, MBA, Realtor (U.S. Spaces) — Wed, 18 Mar 2009 12:00:59 -0500

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.

Beware Non-Licensees!

Mario Villagran, MBA, Realtor (U.S. Spaces) — Mon, 16 Mar 2009 12:49:53 -0500

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.

Tax Shelter

Mario Villagran, MBA, Realtor (U.S. Spaces) — Tue, 03 Feb 2009 14:35:35 -0600

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.

How the Mighty Have Fallen!

Mario Villagran, MBA, Realtor (U.S. Spaces) — Wed, 21 Jan 2009 14:46:38 -0600

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.

Letter to our 44th President

Mario Villagran, MBA, Realtor (U.S. Spaces) — Wed, 05 Nov 2008 02:15:05 -0600

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

McCain v. Obama (none of the above)

Mario Villagran, MBA, Realtor (U.S. Spaces) — Tue, 04 Nov 2008 02:39:26 -0600

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.

Loan Modifications

Mario Villagran, MBA, Realtor (U.S. Spaces) — Wed, 29 Oct 2008 15:49:25 -0500

Loan Modifications seem to be the next industry to boom. There are so many people that owe more than their house is valued and with the economy in a downward spiral some of these people are having a difficult time making their mortgage payments. Companies are starting to issue layoff notices and they have also cut down on bonuses and overtime. Most people I know depend on the overtime to survive. Banks have also frozen many home equity lines of credit (HELOC) in this credit crunch. We are a society that uses debt as leverage so that we can have the birthdays and holidays that we all feel we deserve. Well we've gotten a huge wake up call.

What do people do now? The federal government has given people a free pass to walk away from their mortgage obligations and not pay taxes on the amount of debt that is forgiven. This was done with the mortgage debt relief act but one problem is that the state of California has not conformed to that law. People are still facing a big state tax bill when they are foreclosed on or even short sell their home. Since the passage of this law foreclosures have risen and so have rents. People who leave their homes now are looking at expensive rentals plus paying rent does not provide you with a tax write-off like paying mortgage interest does. Loan modifications seem to be one of the best solutions out there. Last week the Federal Deposit Insurance Corporation (FDIC) Chairperson, Sheila Bair, proposed an initiative to set guidelines and standards for loan modifications. Today, October 29, it was announced that Sheila Bair's proposition to the banks and lenders is to modify more loans and for the government to guarantee those modifications. Peter Barnes also reported, on the Fox Business Network, that the government is encouraging mortgage servicers to modify loans and the government will guarantee these modified loans.

Well lenders were already starting to modify loans. Companies like Green Credit Solutions (GCS) have been doing it successfully for a couple of years now. Green Credit Solutions is a company that I refer people to because I've researched their track record and most importantly they work hand in hand with the Department of Real Estate (DRE). You can look them up at http://www.getgreencredit.com. They are an attorney assisted company that gets results. Borrowers do have the option of negotiating themselves or getting free counseling at places like http://www.hopenow.com. Just like everything else sometimes it is just better to pay someone to negotiate for you because it can be time consuming. I myself negotiated for a client successfully and didn't get anywhere for another client. It really depends on the bank but I would not try it on my own anymore. This is why I refer clients to GCS.

With the federal government guaranteeing these troubled loans, I am predicting that more mortgage servicers are going to be more flexible with loan modifications. This means that there is going to be a larger number of borrowers calling for help. For the average person getting through to the lender is going to be near impossible. If anyone would like to talk about their options please feel free to contact me via email at mvillagran@dovproperties.com or call me at (818) 416-7511. Why do I make myself available? The more people I help the more referrals I will get. It's that simple. "Ain't no such thing as a free lunch", well this is the closest that you are going to get.

NAR's Stimulus Plan

Mario Villagran, MBA, Realtor (U.S. Spaces) — Thu, 23 Oct 2008 16:59:00 -0500

The National Associaton of Realtors (NAR), who I'm a member of, recently presented a stimulus plan to congress. Why shouldn't they since congress seems to be doing anything that they feel is going to boost confidence in the market. It is only tax money after all. Here it is and you can also read about it at http://www.mortgagenewsdaily.com/10222008_NAR_Four_Point_Plan.asp.

$7500 tax credit to all buyers without having to pay it back.
Urge congress to use some of the $700 billion to buy mortgage backed securities.
Extend credit to Main Street, making credit more accessible to consumers and businesses. Expediting the short sale and REO process.
Make permanent the prohibition of banks entering real estate brokerage and management.

I don't like to disagree with my association because they do mean well especially for the people in our industry. This is about principle for me and so I'm going to express myself and explain why I don't agree with these recommendations.

The tax credit I don't have much of an issue with because I think we are overtaxed anyways. As long as the credit is only applied against the federal taxes that have been paid in because otherwise the tax credit becomes a social welfare program.
I'm against the bailout plan and I'm against using tax money to buy bad investments. Why are we trying to fix prices. If someone fails then allow them to fail because another investor or corporation will come in and replace them and fulfill the demand for their services.
How do you force anyone to extend credit or force them to expedite short sales? This would be great because I know that there's many realtors and buyers that don't like short sales because dealing w/ the banks and lenders is a huge pain and not worth the effort. I really believe that lenders are getting paid by insurance companies and this is why they take forever to expedite a short sale if they expedite one.
Well NAR is trying to protect the careers of its membership. I welcome competition and especially competition from the banks. Realtors distinguish themselves from the competition because we build our relationships and hold our clients hands through the home selling or home buying process. After dealing with banks on some real estate transactions and hearing other Realtors' horror stories, I know that the banks would not be able to compete and they would make Realtors look that much better.

Prices will hit a bottom. We need to face the fact that the real estate bull market happened because of speculation and creative financing. A very liquid market put prices out of reach for many that some decided that the only way they would ever get into a home was with a negative amortization loan. Prices are dropping and rent continues to climb making buying a home an option for many that were priced out. Let the market take care of itself.

There are companies out there helping borrowers stay in their home. There are people everywhere that have hardships and I refer them to Green Credit Solutions, http://www.getgreencredit.com. They offer loss mitigation services and have been able to modify many loans and for those that can't be modified they negotiate the short sale or deed in lieu of foreclosure. I advise the client that they can always do these things on their own but like everything else, sometimes it pays to pay someone to work for you.

Should the U.S. Bail Out Homeowners?

Mario Villagran, MBA, Realtor (U.S. Spaces) — Tue, 14 Oct 2008 15:56:39 -0500

This morning when I dropped off my children I had a parent tell me that the government should pay off everyone's loan. Thank God it was before the kids' morning prayer because I was able to pray for this man. The funny thing is that I can't blame him for thinking this way. After all the government is setting themselves up for its citizens to think like this. They preach personal responsibility but only for individuals not for CEO's and officers of major corporations or for people that continue to have children that can't afford them.

Being in this industry yes I would love for anything to happen that would stimulate spending but that would be selfish on my part to encourage the government to be irresponsible with our taxes just so I can benefit. I'll stick to hard work and perseverance and know that in time it will pay off. In the meantime my kids and I are not eating out and ramen never tasted better.

The problem that I see is that we continue to ask what can our country do for us and no longer ask what we can do for our country as our former president JFK once asked us to do. Now we are asked to share the wealth but we can't ask somebody to stop having kids unless they can afford them. We are asked to take our hard earned money to pay for these companies that are failing while the officers that ran these companies to the ground collect multi-million dollar paychecks. Why are the people of our country not up in arms about this. Why do we allow these politicians who are terrible economist and accountants to do whatever they like with our money?

What happened to the billions of dollars that many of these financial companies said that they had. Shareholders were investing in these banks because they stated that they had money. Did they put it under a giant mattress? I believe that these companies tightened up because they knew eventually the government would eventually come and bail them out. Just like they have in the past with the airline industry. For a while I started to think that maybe I should try to be a CEO for a major corporation and run it into the ground. Sure seems like you get rewarded for that type of behavior. The problem is that I don't like to fail. I teach my kids that it's not okay to fail. Now the government is telling my kids that it's okay to fail and it can also make you a lot of money. I believe in learning from our mistakes but not to learn that it's okay to continue to make mistakes.

It saddens me that the media only follows the two major parties in our politics. I myself believe that my ideology is more in line with the libertarian party and wish I could see more of them on the news. Since I don't I'm on-line trying to find the truth about how these new policies affect me and the economy. I wish the American people would start to do the same.

My answer to the gentleman that suggested the government payoff mortgages was that although it would be nice it is not necessary. In southern California I witnessed people buying and knowing what they were getting into. I also heard mortgage brokers trying to push option arms because they would make so much money from them. They were trying to maximize what they could legally make. Did they ever advise borrowers that if values stopped rising or started to drop that they would have a difficult time getting out of that type of loan, some did and some didn't. Were borrowers stupid for not reading their documents, the simple answer is yes. They relied on what the lender told them and that's it. The tough questions were not asked. Yes it's difficult to read the fine print but you don't always have to get into the fine print to see that you are getting suckered into something you shouldn't be buying. My thoughts are that if the banks were told that they are not getting help then they would figure out a way to fix things fast. Loan modifications, faster approval on short sales, and common sense underwriting are some simple solutions that should have taken place at least in the beginning of 2007. Lending standards now require prices to drop some more or for people to get raises so that they can afford and qualify for loans. I don't see raises happening anytime soon. The banks were too greedy to accept some of these simple solutions because they themselves did not know that the market was going into the toilet.

Every Day Alive is a Blessed Day

Mario Villagran, MBA, Realtor (U.S. Spaces) — Mon, 06 Oct 2008 18:39:25 -0500

Doom and gloom is all you hear in the news these past few weeks. Just a while ago I read of a father and husband that took killed his family and then himself because of financial worries, http://www.dailynews.com/ci_10651501?source=rss. Thousands of families are in distress and this market will soon change. The truth is that we see cycles like this throughout our history and we have recovered from each one. Let's focus on what we have and not what we don't have. Please call someone before it gets so bad that you think taking your life is your only option. Money isn't everything but life is.

I myself have struggled in life and am still struggling today. Life keeps throwing me curve balls but I am still in the game. I've turned to the Bible and many other books to guide me. I am not a counselor and can't suggest any one fix for these turbulent times but I can offer an ear if anyone should need somebody to listen. I also want to offer some websites that I have found to be helpful.

http://www.save.org

http://www.getgreencredit.com (I can help w/ this company)

http://www.usccb.org/nab/today.shtml

If anyone has additional sites please add them in the comments section and I'll update this blog.

Have a blessed day and remember the past is the past and we can only learn from it.

This is what keeps me going.

Need Somebody to Listen, Call a Realtor

Mario Villagran, MBA, Realtor (U.S. Spaces) — Thu, 02 Oct 2008 15:22:02 -0500

This has been a hectic week for everyone. Many family members, friends, and clients have been calling me to get my opinion about what's happening. I could go on and on about why I think this bailout plan is wrong for us and will prolong our recovery but that's not the purpose of this blog.

After all of the voting has taken place we still have people that feel alone and are in deep financial trouble. I want these people to know that you are not alone and there are solutions. Don't give up and don't allow these financial troubles to make you sick or ruin your relationships. The dust will settle and we will survive. The question for many is when and the honest answer is we don't know. We have many hurdles to jump over such as corporate greed, fraud, legislation, and consumer confidence.

Keep in mind that we live in the greatest country and we continue to learn and adapt from lessons in the past. Our economy is more diverse than ever before and new industries will develop from this shakeout. We have always had business cycles and can I honestly say that we've hit bottom, no because some have not even acknowledged that we were in a recession. I don't have the numbers in front of me but as a common person I can honestly say that it feels like a recession.

The purpose of this blog is to let the consumer know that we as Realtors are part of their community. Many of us have first hand experience dealing with these cycles. Some of us have experienced foreclosure, bankruptcy, divorce, and many other life changing events. Lately it seems that we have added therapist to our job description. I know I don't speak for myself but for many other Realtors when I say that we are here to help. Our careers are about relationships. Many people see us as salespeople only but that is just a small part of our job. We build relationships with clients and other professionals. We continue to educate ourselves with what is happening in the market and government.

If you are having problems in this market and are looking for a solution I would recommend that you call a local Realtor. At the very least they may be able to refer you to an organization that can give you the help you are looking for. You are not alone during these tough economic times.

These past few weeks I have met with financial planners and loss mitigation companies. I have learned that if the government plan does pass then they are going to require lenders to work out a solution with the borrowers so that foreclosures can be avoided. You don't have to let your home go into foreclosure and for buyers the rental market is strong so if you have the cash for a down payment then finding some rental properties right now would be very smart. I invite you to call me if you or anyone you know needs to talk about your current situation and maybe we can find a solution that is right for you. There's no obligation after all we are just talking and hopefully I can help you. You may ask what's in it for me, well believe it or not I believe this is what my purpose in life is.

Mario Villagran, MBA, Realtor

mvillagran@dovproperties.com

(818) 416-7511

Let's Go Green!

Mario Villagran, MBA, Realtor (U.S. Spaces) — Wed, 10 Sep 2008 16:35:40 -0500

I just finished reading the September issue of California Real Estate, California Association of Realtor's magazine, while on a camping trip in Carpinteria, CA. What a beautiful place but off the coast you can see the platforms where they drill for oil. This was the "Green Issue" and so the timing couldn't have been better. It covers many issues regarding the trend of "Green Real Estate". For those of you who do not know what this "Green Movement" is, it is a movement to raise awareness of the amount of pollution our demand for energy creates. It is a movement that would like to get more people using renewable energy or at least energy more efficiently.

This movement started to get much more attention as the price of gasoline skyrocketed. As people started to see the affects that this had, not only on gas but on prices at the supermarket also, they started to seek solutions. Many started to drive less or at least change their driving style so that they wouldn't consume so much gas. I've seen more people biking or taking public transportation to work. Some of us are recycling more during these tough times and getting back some spare change. Every little bit helps as you can see for the past few weeks the price of oil and gas has continued to slide downward. This is the power of the market. What we are seeing is the price trying to reach an equilibrium between demand and supply.

Here are a few things that I'm doing and I hope to start doing much more. Remember it doesn't have to cost you a lot and sometimes can actually save you money by going "Green". My lead foot is now as light as a feather. I plan my day and I use http://www.dashfly.com to plan my showings, this makes a lot more efficient use of my time and gas. When I am by myself in the car I try not to use the A/C as much. When we replace our lightbulbs we use Energy Star compact flourescent light bulbs (CFLs). I recycle my toner cartridges at the office supply store. Slowly I am implementing more use of MLS Transact, which is offered by my board for free and it allows for me to have digital storage. I am also setting my computer to stand-by when I go out and if the room is empty I make sure to turn off all the lights. My point is that we don't have to get as drastic as installing solar panels on our roof because that is expensive and it takes about 8 years to make your money back in savings.

I am not one to advocate government mandates, after all I was happy when they defeated legislation that was going to make an energy audit a point of sale requirement, but I do believe it is up to each of us individually to do our part to make this a greener earth for us, our children, our grandchildren, and generations to come. I am not going to preach in this blog but for those who are interested in learning more I'm going to post some links that were in the magazine. Remember to Reduce, Reuse, and Recycle.

Green Financing offers lower rates for clients buying certified energy an efficient home:

http://www.modernearth.com

http://www.mortgagegreen.com

http://www.newresourcebank.com

Green Companies:

http://www.builditgreen.org

http://www.usgbc.org

http://www.greenglobes.com

http://www.ecobroker.com

http://www.thereusepeople.org

Mid Wilshire Craftsman Home - 207 S. Serrano Los Angeles, CA 90004

Mario Villagran, MBA, Realtor (U.S. Spaces) — Tue, 26 Aug 2008 11:29:16 -0500

Mario Villagran | Pacific Atlantic Real Estate | (818) 416-7511

207 S. Serrano, Los Angeles, CA

R3 zoned lot. Craftsman style home. Mid-Wilshire area. Hancock Park
Adjacent.

4BR/2BA Single Family House

offered at $799,000

Year Built	1911
Sq Footage	2,578
Bedrooms	4
Bathrooms	2 full, 0 partial
Floors	2
Parking	1 Car garage
Lot Size	7,250 sqft
HOA/Maint	$0 per month

DESCRIPTION

Diamond in the rough! Beautiful 2,500 square foot craftsman home needs a new owner to give it some TLC. This spacious 4 bedroom, 2 bath home offers a lot of potential for growth opportunities. Other features include a bright and charming living room that opens to the formal dining room with original built-in china hutch, tiled laundry room, and hardwood floors. We have a recent appraisal for $890k but the owner needs to sell due to recent change in career.

see additional photos below

PROPERTY FEATURES

Central heat	Fireplace	Walk-in closet
Hardwood floor	Tile floor	Office/Den
Attic	Laundry area - inside

OTHER SPECIAL FEATURES

Porch, R3 Zoning.

ADDITIONAL PHOTOS

Seller contact info:

Mario Villagran

Pacific Atlantic Real Estate

(818) 416-7511

For sale by agent/broker

Equal Opportunity Housing

Posted: Aug 26, 2008, 6:47am PDT

Radon and Lead Kits

Mario Villagran, MBA, Realtor (U.S. Spaces) — Fri, 22 Aug 2008 14:34:58 -0500

As realtors we are constantly made aware of the dangers that can be found in and around the home. We have so many disclosures that we need to present to the home-buyer that it's very hard to forget. Houses built prior to 1978 most likely had paint that contained lead and radon is a gas that is emitted in the air from the breakdown of uranium, radium and rock in the soil. The real danger is when there are elevated levels of these harmful substances.

The key to staying healthy is education and prevention so I thought it was my responsibility to share a site that can be used to educate ourselves. Http://www.consumerreports.org is a great site. They are a non-profit that doesn't take any product donations and uses their own money to test products and offer a non-biased opinion. They have recently tested lead and radon test kits for the home. If you are thinking about buying one for your home I would suggest you check out http://www.consumerreports.org/health/healthy-living/health-safety/lead-radon-test-kits/overview/lead-radon-tests-kits-ov.htm.

Stay safe and keep your family safe. Your home should be there for enjoyment and not be something you worry that is making you sick. If you'd like more information or tips please email me your email address.

Real Estate Bargains

Mario Villagran, MBA, Realtor (U.S. Spaces) — Wed, 20 Aug 2008 14:37:32 -0500

I've decided to reintroduce my campaign of bringing what my team and I feel are great bargains in the Glendale, Burbank, and some of the surrounding areas. I hope this is helpful.

If you should need any assistance with your real estate needs please feel free to call me or email me.

Burbank Pool Home

Mario Villagran, MBA, Realtor (U.S. Spaces) — Mon, 11 Aug 2008 11:27:33 -0500

Mario Villagran | Pacific Atlantic Real Estate | (818) 416-7511

1716 N. Brighton St, Burbank, CA

Breakfast Nook, Large Family Room w/ Fireplace, Formal Dining Room
w/ Fireplace, Pool

3BR/2BA Single Family House

offered at $599,000

Year Built	1939
Sq Footage	1,886
Bedrooms	3
Bathrooms	2 full, 0 partial
Floors	1
Parking	2 Car garage
Lot Size	7,250 sqft
HOA/Maint	$0 per month

DESCRIPTION

CHARMING 3 BEDROOM, 2 BATH, POOL HOME IN A QUAINT NEIGHBORHOOD OF BURBANK LOOKING FOR NEW OWNERS TO GIVE IT TLC. THE HOME OFFERS A FORMAL LIVING ROOM WITH FIREPLACE, FORMAL DINING ROOM OPENING TO THE EXPANSIVE FAMILY ROOM WITH A BRICK FIREPLACE AND SLIDING DOORS THAT GIVE ACCESS TO THE COVERED PATIO AND GATED POOL AREA. THE KITCHEN INCLUDES TONS OF STORAGE AND COZY DINING AREA WITH BUILT IN CORNER CABINETS. OTHER FEATURES INCLUDE LARGE MASTER WITH PRIVATE ENTRANCE AND ATTACHED 2 CAR GARAGE.

see additional photos below

PROPERTY FEATURES

Central A/C	Central heat	Fireplace
Hardwood floor	Family room	Breakfast nook
Laundry area - inside	Swimming pool

COMMUNITY FEATURES

Playground

ADDITIONAL PHOTOS

Seller contact info:

Mario Villagran

Pacific Atlantic Real Estate

(818) 416-7511

For sale by agent/broker

Equal Opportunity Housing

Posted: Aug 11, 2008, 7:24am PDT

2215 W. 15th St. Los Angeles, CA - Business Opportunity

Mario Villagran, MBA, Realtor (U.S. Spaces) — Tue, 29 Jul 2008 16:45:46 -0500

Mario Villagran | Pacific Atlantic Real Estate | (818) 416-7511

2215 W. 15th Street, Los Angeles, CA

Don't Miss Your Chance On This Great Business Opportunity!!!

9+BR/4BA Single Family House

offered at $749,000

Year Built	1914
Sq Footage	4,928
Bedrooms	10
Bathrooms	4 full, 0 partial
Floors	2
Parking	4+
Lot Size	7,492 sqft
HOA/Maint	$0 per month

DESCRIPTION

Price includes existing board and care business operating in this home. Business has 24 beds and 21 are occupied. Annual sales of $200k+. This is a perfect business opportunity. Property is zoned for nursing home already. Buyer to verify w/ city all potential uses for this property. Seller is open to selling the property without the business and can deliver the property vacant at the close of escrow.

see additional photos below

PROPERTY FEATURES

Central A/C	Central heat	Office/Den
Dining room	Laundry area - inside

ADDITIONAL PHOTOS

Seller contact info:

Mario Villagran

Pacific Atlantic Real Estate

(818) 416-7511

For sale by agent/broker

Equal Opportunity Housing

Posted: Jul 28, 2008, 2:31pm PDT