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America's #1 Mortgage Broker/858-777-9751 — Sat, 17 Oct 2009 11:45:28 -0500

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Fewer Government Loan Programs For a Healthy Mortgage Market

America's #1 Mortgage Broker/858-777-9751 — Sat, 19 Sep 2009 08:29:32 -0500

I suggested that the real estate brokerage and finance industries stop devouring flesh, as a means for survival. That idea generated close to 150 comments. I was surprised that nobody called a hyprocrite for advocating smaller government while funding government-guaranteed home loans.

Carl Schumacher called me out:

I also happened to notice that in the title of your blog here you're claiming to be "America's Number 1 VA Home Loan Broker." Interesting ad for a guy that feels the government shouldn't be involved in housing. Last I knew, the VA lending program is a "government guaranteed" loan program. Based on your analogy then, I'm guessing you feel it should be eliminated because the government created it?

Just sayin' . . .

Carl, this conundrum confounded me daily until...

I found the answer.

Why Devouring Flesh Is Morally Wrong (and how you can stop doing it)

America's #1 Mortgage Broker/858-777-9751 — Thu, 17 Sep 2009 01:04:45 -0500

When I pleaded for our industries to stop the practice of devouring our children's flesh, I made a few references to the fact that we have never lived in a free market economy. Historically, the march to Collectivism started in the 1930s with FDR's New Deal. FDR introduced hundreds of Socialists into the Government and started the concept of a planned economy with the New Deal. Chesly Manly outlines this in The Twenty Year Revolution: From Roosevelt to Eisenhower (just read Chapter 3 and 4 for the meat of his argument).

While this wasn't a complete Marxist transformation, it introduced the concept of crony capitalism or, as Greg Swann calls it, Rotarian Socialism:

We are apt to think of Communism as being Capitalism’s natural enemy, but there is another, perhaps more insidious foe to unfettered laissez faire. I call it Rotarian Socialism, just to give it a name. Rotarian Socialism is legislation written by and for the membership of a politically-powerful elite. Most of the criticisms you hear about Capitalism are in fact criticisms of Rotarian Socialism.

Adam Smith warned, in Wealth of Nations, that when businesspeople get together, they are likely to collude against the populus for their benefit. It is when they enlist the aid of the State, to conspire to defraud the populus through legislation towards price-fixing and protectionism; that crony capitalism has a more insidious effect than Marxism.

The NAR's shameless push for Congress to extend or expand the home buyer tax credits are just that; crony capitalism. This video, produced by the Acton Institute does a nice job outlining how far we've regressed since the Reagan Era:

The crony capitalism practiced by the NAR (and MBAA, for that matter) is a conspiracy to defraud the public by "rigging the game against the little guy". It "devours the flesh" of our children because it adds to the federal budget deficit, saddling them with bills they can hardly pay. When their flesh is eaten, the carcass will be a nation of indentured servants, cowering to a political class.

The moral relativist's argument is "the Government is spending all this money, why not give it to buyers so I can earn some commissions ?". Please know that I understand the short-term rationalization that comes with an increased paycheck but I beseech you to wonder how much better our industry would be if we didn't have to rely on the Government anymore. In short, theft is theft; ask Duke Cunningham what happens when the rationalizations come unglued.

You have most likely NEVER truly lived in a free market society (unless you're 90 years old). Please consider what could be if you did, before commenting.

Suspend the Practice Of Flesh Devouring: Let The First Time Home Buyer Tax Credit Expire

America's #1 Mortgage Broker/858-777-9751 — Tue, 15 Sep 2009 22:56:20 -0500

Please stop this zombie behavior. Government doesn't create wealth, it devours it like a zombie devours all that is living. Do you know what happens to zombies? They devour everything living until there is nothing living anymore....then they die, too.

Government home buyer tax-credits are bribes. They're bribes to get unwilling and unsophisticated home buyers to purchase assets which may be artificially inflated. Haven't we learned enough from the mistakes of Government's social engineering in the mortgage markets? The social engineering associated with the Community Reinvestment Act inflated a real estate bubble which popped and ruined families' opportunity to create a reliable nest-egg from equity in their homes. It started off slowly and accelerated when expanded to encompass most any sub-prime loan. The Government-provided backstop for losses encouraged market participants (banks and non-depository lenders) to make mortgage loans with complete disregard for the borrowers' abilites to repay those loans.

Government intervention to entice asset purchases creates a pyramid scheme which ultimately leaves someone holding the bag. Like Bernard Madoff did with unsuspecting investors, the National Association of REALTORs attempts to start a new Ponzi scheme based upon a Government incentive. Someone's gonna get left holding the bag for this scheme; most likely our children.

We are in the midst of the largest "right pricing correction" of our lifetimes. The existing housing decline, driven by the failure of the unsustainable, poor lending practices (foreclosures) is healthy. Free markets reward prudent use of leverage and punish the irresponsible. Many people trusted mortgage consultants and real estate agents to advise them to eschew bad business practices and make prudent purchase decisions. Instead, we nursed on the milky teat of a Government-sponsored Ponzi scheme destined to fail.

Fail is what the extended tax credit will do. The initial first-time home buyer tax credit was an interest-free, loan from the US Treasury. While still immoral, it provided for the repayment of that loan to the Treasury. We descended down the slippery slope of "jump starts", expanded the size of the credit, and forgave the repayment of those "loans" with the sole purpose of giving the housing INDUSTRY, not housing market, a boost.

To request further Government assistance for our industry is deplorable. We need a housing market that relies on the principles of supply and demand rather than some cheap, two-bit hustle. More foreclosures are coming and that will be tragic for millions of American families. One man's tragedy, however, is another man's opportunity. If we, as real estate agents and loan originators are to support the principles of private property ownership, free markets, and real estate as a reliable vehicle to build long-term security, we MUST do what is moral, regardless if it won't allow us to line our pockets.

Please say, "No Zombies! I won't allow you to devour my children's flesh" and encourage your elected reprsentatives to act like sober, prudent people...

...not zombie enablers.

PS: If you're a first-time home buyer, by all means take the tax credit but make no mistake about it, this credit REALLY wasn't for you, it was for us, the zombies in the housing industry.

Why Devouring Flesh Is Morally Wrong (and how you can stop doing it)

Brian Brady Promoting Progressive Thought?

America's #1 Mortgage Broker/858-777-9751 — Sun, 13 Sep 2009 01:23:30 -0500

In the spirit of bi-partisanship, I'm recommending a subscription to The American Prospect for all the progressive thinkers on Active Rain. You can order it at a discount here ($20.00 for a year's subscription). Be certain to denote Maggie Brady as the student and if you'd be kind enough to enter her e-mail (surfermaggie@yahoo.com), we'll be notified of your commitment to progressive thought.

American Prospect describes itself as:

The viewpoint of the Prospect is that of committed, engaged progressives--realistic but committed to the idea that there is greater range for genuinely transformative policies than is often imagined, especially in Washington. We believe in an economy that provides broadly shared prosperity, and in which a foundation of economic security allows all people to make the most of their own talents and aspirations. We believe in a renewed democracy, based on transparency and civic engagement. Prospect writers and columnists have written emphatically about the need for a decisive and ambitious response to the current economic crisis, about the urgency of universal health care as well as the options for achieving it, about the revolutionary possibilities of climate change legislation as well as the political obstacles to achieving it.

Certainly, a subscrpition to American Prospect will arm you better in philosophical debate against me, a card-carrying member of the Vast Right Wing Conspiracy. It will also support my daughter's school.

Maggie's pitch is here...and here...and here...and here. Thanks for your support!

MaggieBrady.com offers discounted magazine subscriptions

America's #1 Mortgage Broker/858-777-9751 — Sat, 12 Sep 2009 18:50:35 -0500

Here we go again! It's time for our second season at MaggieBrady.com.

Maggie Brady is raising money for her school through a magazine drive. Last year, she won the iTouch for superior sales efforts. Here's Maggie congratulating Linda Davis for being the "smartest REALTOR in Connecticut".

Won't you consider purchasing or renewing a magazine subsciption here? Close to half of the subscription fee supports St James Academy and maggie receives double points for online subscriptions. Magazine subscriptions start as low as $15.00.

Browse your options here.

Is Phoenix the Epicenter of Real Estate Blogging?

America's #1 Mortgage Broker/858-777-9751 — Thu, 03 Sep 2009 22:04:09 -0500

From the Active Rain wayback machine. The first ever "Active-Rain affiliated" Real Estate Bar Camp", written January 7, 2007:

A light rain couldn't spoil the excitement and enthusiasm I felt this morning as I drove into the heart of the City of Phoenix. Papa Joe Brady, my able seminar assistant, retired sales executive for First American Real Estate Solutions, and proud Luddite negotiated the streets of the boom town as we headed to the first Arizona Real Estate Bloggers Roundtable.

The Roundtable was a trial balloon post here at Active Rain. I had planned to be in Phoenix this first week of the new year to write some loan applications and visit my family. I had hoped I might convince a few AZ Realtors from Active Rain to allow me to buy them some donuts and have a collaborative discussion. Yes, boys and girls, you heard that correctly, America's Most Opinionated Mortgage Broker broke marketing to Realtors rule #1; I bought them donuts.

Many things contributed to the excitement I felt. Nostalgia was one of them because I spent 12 years in Phoenix. The compelling reason for my excitement was the Roundtable, an historic event. Today reinforced my earlier declaration that Phoenix is the epicenter of real estate blogging.

The huge draw was the presence of three accomplished webloggers: Greg Swann of BloodhoundBlog (accompanied by the lovely and articulate Cathleen Collins) . Jonathan Dalton of Phoenix Arizona Real Estate Blog, and Jay Thompson of The Phoenix Real Estate Guy.

READ: The Bloodhound's post about this event complete with a picture and follow-up action item (BLOGINAR)

The excitement was further driven by budding blogging superstars, Tony And Suzanne Marriott, Adam Tarr and Sharon Kotula, Ken Spencer, Mario Romero, and "Doctor" (check his profile) Kaushik Sirkar. The enthusiasm was apparent in newer entries to the Real Estate 2.0 world, Lorine Lovett, Brian Cross, Rich Pieropan, Nicole Whitman, Sandra Heredia, and Blake Mata.

I tried to gently moderate the Roundtable by asking three questions:
1- How did you get here?
2- Why are you writing?
3- Where do you see the future of Real Estate 2.0?

This prompted two hours of lively discussion which is not limited to but highlighted in these points:

1- Transparency is clearly working. Consumers love to "get to know" a future real estate professional by reading about them online. Jay Thompson shared the story of the Vanilla Pepsi buyer, I related how quickly I've built relationships with Realtors, and Greg Swann cautioned us that transparency is a double-edged sword; lie and you die.

2- Real estate bloggers blog to find business, Adam Tarr was unabashed in his declaration of this goal as was Tony Marriott (I stipulated), The "Old Guard" of the epicenter Greg, Jay, and Jonathan were somewhat circumspect in the desired results of that goal but were quick to offer practical solutions to those who felt it possible. That discussion led to...

3- The Solution; linking to local blogs for your "farm" area. Note that we concluded you should link to local blogs, NOT local real estate blogs. An example might be for Kaushik Sikhar to find a city council race in Chandler, AZ and link to the candidates weblogs as a mode of setting himself up as the expert in Chandler, AZ. Rich Pieropan proudly claimed the title of #1 for Luke AFB, AZ. When the group chuckle died down, Greg Swann ebulliently offered a detailed plan for taking advantage of the long tail by writing about topics relevant to the communities surrounding Luke Air Force Base and thereby establishing yourself as the expert.

4- The Long Tail versus SEO rankings. Fancy words for getting ranked high on Google search versus establishing yourself as an expert online for a specific community or market. I attempt to do this with my articles about hard money. Thoughts steered to the conclusion that The Long Tail might indeed be the future versus SEO rankings. One only has to look at the creation of Localism.com andMyHouseKey.org as examples of how some of the big thinkers in Real Estate 2.0 believe this war can be won.

5- Active Rain is the absolute best place to learn how to become a real estate weblogger. The environment is friendly, supportive, and very instructive. Newer or hesitant authors should attempt and hone the craft here. I will personally reinforce this thought by stating that the Active Rain community doesn't care if you suck. The members want to give constructive advice because we are grateful to have a forum to explain our views and improve our writing skills. Newer authors MUST take the leap here and MUST do it today.

In 13 years of lending and 22 years of financial services, I have NEVER seen a cause more exciting, a group of people more supportive, or a time more relevant.

Today was the epitome of that conclusion. Thank you to everyone working in the epicenter.

SOCIAL MEDIA MARKETING: Waste of Time?

America's #1 Mortgage Broker/858-777-9751 — Tue, 01 Sep 2009 23:27:39 -0500

If you’re reading REALTOR magazine, you’re hearing about how to find business blogging, or using Twitter, LinkedIn and Facebook.

Does this stuff work or is it all a hoax?

The answer is yes; social media marketing works and…

YES, it is incredibly over-hyped.

What started as a Web 2.0 revolution, some 5-7 years ago has morphed into a full-blown industry in itself…complete with “experts” charging you for a webinar about how to use these media. The sad fact is that you might go broke if you relied only on social media to market your real estate agency practice.

BloodhoundBlog’s Greg Swann (Phoenix real estate broker) and Brian Brady (national lender based in San Diego) will be giving you the low-down on social media

Friday, September 11, 2009
8:55AM-11:55AM
Phoenix Association of REALTORs, 5033 N. 19^th Ave Suite 111, Phoenix, AZ 85015

COST: .........FREE

Call Kerri Melcher at 602-390-9309 to reserve your spot today..

Only 15 seats available so act IMMEDIATELY!

PS: Can’t join us? Get the scoop on www.BloodhoundBlog.com

Chula Vista Little League wins World Series

America's #1 Mortgage Broker/858-777-9751 — Tue, 01 Sep 2009 19:35:41 -0500

From fellow San Diegan, William Johnson. The "Blue Bombers" of Chula Vitsa brought home the WORLD title!

Via San Diego Real Estate Voice authored by William Johnson (RE/MAX Associates):

Chula Vista Little League wins World Series

Chula Vista's Park View All-Stars were crowned Champions of the Little League World Series held in Williamsport, PA. Chula Vista welcomed home last night the Park View team and thousands were hand to great the new celebrities. The city of Chula Vista is planning a celebrity parade on Friday. And guess who the celebrities are? The Chula Vista All-Stars and every single player is just that. Celebrities.

The 20 or so team members who began their quest to the title a little over 3 weeks ago were nearly perfect in losing only one game in the whole series. Saturday they won the US Championship and played Taiwan on Sunday to win the whole "shootin" match.

This is the 2nd time a San Diego Little League team has won the title but it had not been since 1961 when a team from the combined areas of El Cajon and La Mesa brought the title home from Williamsport. 48 years is a long time ago but when it comes to little league, people still talk about it and that special someday when the title would return. They won’t have to wait any longer, the title is here now, the team has returned home and the World Series banner will be proudly on display during the parade of Champions on Friday.

The Chula Vista Park View All-Stars are truly role models for young generations in all parts of the world that support this character building sport called Little League. The All-Stars, besides winning the World Series title also set a new world record. Nineteen Home runs in 5 games. Pretty amazing.

And for those that don’t already know this, there is no local, state or federal funding for Little League. Each team has local sponsors that help to pay for their shirts and the rest is funded by families and fund raising events. This is a local grass roots enterprise that relies on very local participation of community builders and leaders for support. And in return for their support, they are assured of the marvelous character building of the players that the Little League enterprise brings forth through the many decades of character building since its inception. No one could dispute that this is a pretty good trade off of value.

Congratulations to the Home Team, The Chula Vista All -Stars.

If you are Buying, Selling or Relocating to San Diego and need help from a professional REALTOR®, give me a call or visit my San Diego Real Estate website and sign up for Listing alerts for your favorite San Diego Home and Condominium Property Searches. I specialize in Single Family Homes and Condominiums throughout the coast and inland areas of San Diego. Some of the communities are La Jolla, University Town Center, Bay Park, Mission Valley, Pacific Beach, Scripts Ranch, Poway, Carmel Mountain Ranch, Rancho Bernardo, Rancho Penasquitos,Carmel Valley and Solana Beach. If I didn't mention a city or community that you are interested in, just let me know and i will find you an expert for that community as well.

Need Help and Guidelines for Buying or Selling a Home ? Check out my new " Voice of San Diego Real Estate Blog "

Copyright 2009 William Johnson author of The Real Estate Text Book
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LIKE MY BLOG, Subscribe and enjoy all the great and creative things yet to come!

VA Jumbo Mortgages Allow For Low Down Payment Options For Luxury Homes

America's #1 Mortgage Broker/858-777-9751 — Sun, 30 Aug 2009 19:36:47 -0500

Most mortgage companies offer a VA no down payment option up to $417,000 but did you know that VA loans can be for much more?

The Veterans Administration works off of a "guaranty", meaning that they pay the lender 25% of the loan amount should the veteran default on her mortgage. Pragmatically, it would make sense that the borrower be allowed to invest 25% of the difference between the purchase price and the VA loan limit. That's just what the VA jumbo mortgage program allows.

Some high-cost counties have higher loan limits until 2012. In San Diego, that loan limit is $593,750. For Los Angeles and Orange counties, that loan limit is $737,500. Some Bay Area counties go as high as $1,094,750. That's over a million bucks for a zero-down VA loan.

What's a veteran to do if she doesn't live in a high-cost county but wants to buy a $700,000 home? Normal jumbo loan programs require as much as 30% down payment (in distressed markets). That high down payment prevents many buyers from owning a luxury home, offered at a healthy discount. Veterans, however, have another option. Use this formula to determine the down payment requirement for a VA jumbo mortgage.

In the aforementioned case, the required down payment for the $700,000 home purchase, for a property that is not in a high-cost county, is just over $75,000. That down payment requirement is just about 11%; far below some of the higher down payment conventional loans.

What about mortgage insurance? VA home loans don't require mortgage insurance; they charge a funding fee (which can be financed).

Are the rates really high? That depends on your definition of "really". VA jumbo mortgage and FHA jumbo mortgages are typically about .5% higfher than the loans under the county loan limits. Most of the VA jumbo mortgages we've funded this year are in the 5.5%-6.0% range.

Consider offering your property with a fiancing proposal drafted by a VA jumbo mortgage expert. Sometimes, showing that low down payment option could be the thing that attracts the right buyer for your luxury home.

What's the Value of a REALTOR Relationship For Originators?

America's #1 Mortgage Broker/858-777-9751 — Wed, 26 Aug 2009 21:31:10 -0500

Solid real estate agent relationships are the cornerstone of any professional loan originator's business plan. While the mortgage industry has done an excellent job at consumer direct marketing, home buyers still consider the real estate agent the "gatekeeper of the transaction" and even rely on them for advice on financing. This is especially true in the first-time home buyer market.

The value, however, of each individual agent relationship has waned in the past 6-7 years. When I first started originating, each agent in my "Rolodex" averaged three transactions annually. An originator looking to close 100 purchase loans annually needed to be marketing to about 30-35 agents.

Fifteen years ago, the primary method of marketing was to show up at the agent's office and "panhandle" for business. Successful transactions begat baskets of flowers to the agent, followed up by visits with hopes of being introduced to "office mates". Three things changed that model:

Lower margins in real estate brokerages left owner-brokers seeking affiliated business relationships. Originators found the "in-house mortgage guy" greeting them at the reception desk and escorting them back to the agent's desk. That guided visit served as a deterrent to visiting originators and a reminder to the agent of the responsibility to their employing broker.
The early-decade real estate boom swelled the ranks of real estate agents and loan originators offering customers far more "friends in the biz" than they had before. This commoditized our business and caused home buyers to "shop" better. With greater "hidden" competition, the professional loan originator found the move-up buyer less loyal even after all the personal marketing he did.
Technology moved real estate agents out of the office and into their homes. No longer could an originator show up at an office right after a sales meeting, to meet agents, because there were far fewer sales meetings. Voice mail made floor time extinct.

Today, originators have an extraordinary opportunity to work with large numbers of real estate agents. The internet expanded our reach and reduced our marketing costs to near zero. Today, a simple GOOGLE search can tell you who the active real estate agents are in a micro market, along with contact information. The value of that agent relationship, however, is severly diminished. In addition to Affiliated Business Arrangements, listing agents are requiring a "mirrored" pre-approval with a lender of their choice, often at the behest of the seller.

The value of a real estate agent relationship is about half of what it was ten years ago. Each agent relationship can be expected to produce about 1.5 transactions annually. The loan originator then must be marketing to about 75 agents to produce 100 purchase loans annually.

Today, it's never been easier to earn that business.

Our ranks have contracted and only the knowledgable originators are surviving. That badge of honor, worn properly, is a magnet to real estate agents. The internet has expanded our reach so that we can find, communicate with, and remain in a "top of mind status" with real estate agents all over the country. Here are some ideas that have worked for me these past 18 months:

Get rich in niches. Agents will identify you with your area of expertise just like we do with lenders. California agents know me as the VA expert. Specific knowledge has allowed me to market that expertise with testimonials from customers and agents.
Touch those agents weekly with a good e-mail marketing program; I use Contant Contact. It is important for you to be able to track "opens" to discover who really pays attention to your content. Follow up calls, to the agents who "open" your e-mails blasts, have a higher probability of converting. You can "prune' the list by deleting agents who have left your last five e-mails unread. Use content from the Mortgage Rate Watch , MBS Commentary, or MND newsletter as your weekly newsletter (if you can't write). Properly cited, with a link back to the article, a truncated introduction can be used as content. The important thing is to find agents who appreciate your emails.
Don't forget the old postcard mailer. I mail agents a cheap yellow postcard, with my name, phone number and URL, about every 5-6 weeks. Timed to deliver on a Thursday, that postcard has prompted many agents to call me on a Friday to ask if I'll be available to pre-qualify a buyer over the weekend.
Use webinars and teleseminars as tools to educate agents about new loan programs or guideline changes. I host one monthly using Lenders Insight. I schedule them in the evening so that I can get agents' full attention. Whether you have three agents or thirty on the call is immaterial; you'll get the reputation as the "educating originator".
Call them. Set aside two hours daily to call ten agents to see of they need anyone pre-qualified. This will keep you in front of your 70-100 "targeted agents" every two weeks. Consistently done, you'll be contacting them more often than their "favorite originator" and position yourself to earn the business.

Our industry funded $4 trillion at the height of the boom (2003) with only 35% purchase business. 2009 origination volume is expected to be about $2.3 trillion with about 70% of that attributed to purchase business. As interest rates rise, expect that percentage to rise. While the volume has dropped 40% from the high, the number of qualified originators has been cut by two thirds.

There's a whole lot of business for all of us. Come get it.

This article is on Mortgage News Daily (opens in a new window)

Del Mar Race Track: Day Break at Del Mar

America's #1 Mortgage Broker/858-777-9751 — Sun, 09 Aug 2009 00:01:05 -0500

I'm a Del Mar Race Track junkie. Actually, I've been a fan of horseracing since I was a kid, playing at the Garden State Park, in my hometown of Cherry Hill, NJ. When I moved to Solana Beach, I was attracted to the the beach, San Diego, and best of all, the proximity of the World Famous Del Mar Race Track.

One of my favorite things to do is to take my daughter to breakfast for the morning workouts. The horses start working out at 5AM and the track opens at 7:30AM. You can enjoy a delicious breakfast buffett for less than $10.00 (includes coffee and juice). From the Del Mar Turf Club website:

Early risers have a chance to catch morning workouts and breakfast in the Clubhouse Terrace Restaurant every Saturday and Sunday during the season. From 7:30 to 9:30 a.m., trackside announcer and former jockey Jeff Bloom will provide you behind-the-scenes information while you get an up-close look at many of your favorite horses while they tune up for their next race. A buffet with many breakfast favorites is offered.

To attend, park in the main lot off Jimmy Durante Blvd., then proceed through the Clubhouse entrance to the second floor. There is no charge for admission to the event, but an $8 parking fee applies. (Those buying two or more breakfasts will have the parking price deducted off the price of their bill.)

Above is the mural Pierre Bellocq painted for the 70th Anniversary of the Track. When I walk around the clubhouse, I'm reminded that I'm tracing the footsteps of Bing Crosby, Desi Arnaz, and Jimmy Durante. In fact, all of those men were ushers at St James Church (now in Solana Beach) during the race season. My daughter Maggie and I "substitute" as ushers when someone goes on vacation. As you can see below, Maggie always wants to be part of the Del Mar Scene:

The majesty of a thoroughbred race horse awes me:

Workout riders have their hands full. The success of a horse's next race is often in their hands:

The rider beckons the horse to run a bit as he starts the workout:

Here is nationally-known horse Zenyatta, breezing past the finish line. My home is just on the other side of the hill beyond the finish line:

When all goes according to plan, your horse will win and you'll be standing in the Winner's Circle, like Maggie.

Mission Valley Condo Loans-FHA/VA Approvals

America's #1 Mortgage Broker/858-777-9751 — Fri, 07 Aug 2009 02:12:27 -0500

The following Mission Valley Condo complexes are eligible for FHA and VA financing (as of 8/6/09):

Friar's Pointe
Friar's Hollow
Friar's Mission
Creekwood at River Run
The Franciscan
Friar Gardens
Union Square
River Scene
Mission Gate
Mission Greens
Mission Heights
Mission Playmor
Mission Plaza
Mission Village
Mission Ridge
Mission Verde
Park Villas North
Rancho Mission Villas
River Colony

This information is not guaranteed for accuracy. FHA condominium approvals can be searched at the HUD portal and VA condominium approvals can be searched at the VA portal. It is advised to search at the portal before visiting the complex.

Many conventional lenders are defaulting to the FHA approval as the bellwether approval for Fannie Mae or Freddie Mac eligible loans as well. While conventional loans aren't subject to the rigorous testing the FHA uses, the credit crunch has caused lenders to usurp the traditiional loan-by-loan approval process and only accept FHA approvals.

Contact me for specific requirements if you are looking to purchase a Mission Valley condo.

REQUIRED READING FOR MISSION VALLEY CONDO BUYERS:

Wondering if there really is a shortage of condos for sale? Read this.

Want to make sure you don't overpay for that condo? Read this.

How should you prepare for your loan application? Read this

Where are mortgage rates headed? Read the mortgage rates report

Why The Reverse Mortgage Market Will Disappear

America's #1 Mortgage Broker/858-777-9751 — Wed, 05 Aug 2009 22:13:47 -0500

This isn't a sales pitch; it's some straight talk about the reverse mortgage market. If you're considering a reverse mortgage, you ought to do it now. Not tomorrow, not next year,

....now.

The reverse mortgage market has a ticking time-bomb in it much like the sub-prime market did; it's priced all wrong. Sub-prime loans used to be a very healthy product when the risk they carried was priced appropriately. In 2005, secondary market investors bought too many of these loans, causing a "price war". The darned loans were so cheap that good credit borrowers used them to buy homes bigger than they could afford. The result was increased risk upon a system that was priced for lower risk.

We all know what happened to the sub-prime market. It crashed and disappeared.

Two factors have increased risk on the reverse mortgage market:

1- A national price decline eroded home equity. That's pretty easy to mitigate because the loan-to-value can be cut to reflect that decline. People look at their home equity differently now. Five years ago, Americans felt "wealthy" because home equity kept growing. Today, the reduced home equity makes people realize that it could disappear tomorrow. Home equity harvesting is what's driving the current reverse mortgage boom.

2- Like the sub-prime market, reverse mortgages haven't appropriately priced in the increased risk. Follow me on this. In the reverse mortgage market, borrowers who live past the actuarial age start costing the lender money. Simply put, if the borrowers don't die on time, the system could crash.

Look at this actuarial table and pay close attention to the life expectancies for the years 1940 and 1950. Males born in 1950 are expected to live 4 years longer than their older brothers, born in 1940. 1950-born females are expected to live a full six years longer than their older sisters.

Here are the problems with the current reverse mortgage pricing model:

The underwriters haven't adjusted for these actuarial differences.
There are a lot more people turning 62, in the next 10 years. In 1940, there were 2.6 million births in America. In 1950, there were 3.6 million births. In 1954, the birth number broke 4 million.
Scientific advances could skew the life expectancy data even worse (or better if living is your plan).

Like sub-prime, this mortgage product is going to be a victim of its own success. As the product gains popularity, more market participants will join the reverse mortgage boom and margin pressures will exist. You know how that story goes, the first thing compromised when margin pressures contract is the loan pricing model. We could start pricing this product cheaper when we should be pricing it more expensively.

I'd like to think we can learn from our past mistakes. If that happens, the reverse mortgage product will get much more expensive, really soon. Get the reverse mortgage money while you can; it might not be around tomorrow

Memories of...Cherry Hill, NJ in the 70s (My Childhood Home)

America's #1 Mortgage Broker/858-777-9751 — Thu, 23 Jul 2009 00:36:21 -0500

I grew up in a neighborhood of minor celebrities, in Cherry Hill, NJ. My mother was a REALTOR who sold many of the Philadelphia Flyers' players their homes. Hockey players were the lunch-pail professional athletes in the 70s; they didn't get huge contracts. They lived amongst the lawyers, engineers, and doctors but make no mistake about it; these guys were blue-collar. Reggie Leach lived around the corner from us. "The Rifle" was an aboriginal Canadian from the oil fields of Manitoba. Often, he and fellow Manitoban Bobby Clarke would be watching us play street hockey from Reg's front yard, offering a tip or two. Of course, we didn't know that the pair would be future Hockey Hall of Famers; we just thought of them as the guys that brought the Stanley Cup to Philly.

My love of R&B, soul, and funk music (and later hip-hop) was rooted in the neighborly encouragement from Rock and Roll Hall of Famer Leon Huff. Mr. Huff's daughter was a classmate of my younger sister's. He would occasionally reward me for washing his car or cutting his lawn with 15-20 minutes of The Sound of Philadelphia. What I thought of as a special treat was really market research for Mr Huff; he was wondering if pre-teens would buy music from Philadelphia International Records rather than competitior Motown.

Muhammad Ali bought a Cherry Hill home in the early 70s to rattle Philadelphian Smokin' Joe Frazier's cage. Ali would live in that home when he trained at the Cherry Hill Inn. While Ali billed himself as "The Greatest", most of the Cherry Hill kids villified our neighbor for his derogatory remarks towards Smokin' Joe's looks and actions during the Vietnam War.

Speaking of boxing, middle-weight champ Joey Giardello was a regular at the 11AM Mass at Queen of Heaven Church.

The Garden State Park was across Route 70 from the Latin Casino. Frank Sinatra et al played "The Latin" and were often seen "betting the ponies" at "The Track". Philadelphia Phillie great Dick Allen would show up there and was great to all of the kids accompanying their parents for an afternoon at the Track. Later in life, I'd meet Dick Allen in Phoenix, and thank him for the great memories. Allen had a rough go of it, in the 60s as a Phillie but I reminded him that his stint in the 70s influenced a generation of Little Leaguers. I'd like to think the tear in his eye, when we embraced some 20 years later, was a positive feeling that his legacy as a Phillie would be for his second tour of duty.

Cherry Hill was a melting pot and nothing proved it more than the influx of Tran and Nguyen families to our churches. While our parish priests were criticizing the Viet Nam War, the casualties of Communist aggression were sitting in the pews, soon after the Fall of Saigon.

I described THIS Cherry Hill, on Bloodhound Blog, when I told REALTORs to stop selling houses and start selling memories:

I grew up in the Jersey rendition, Cherry Hill. I’m the product of immigrants’ kids who got out of their ethnic “neighborhoods” and made it to the holy ground; the suburb.

Cherry Hill was great place to live in the 70s because it was the ultimate social experiment. Kids of all colors, creeds, religions, and ethnicities mixed together in a damned good public school system. We celebrated bar mitzvahs and first communions, ate pasta with gravy, danced the polka, and listened to Motown, Disco, and eventually hip-hop music. I call it the ultimate social experiment because you had these kids running around, learning tolerance and cultural respect, amid the conflict of the generational prejudices of our parents and grandparents. The enlightened ones were our parents. They bucked the clannish “trust nobody unlike you” mantras of the ethnic ghettoes in hopes of a better life for their offspring.

Cherry Hill was a white-collar town with blue-collar thoughts. The parents were lawyers, engineers, salespeople, skilled tradespeople, doctors, and middle managers at the RCA plant. They were mostly educated because their parents insisted, through broken English, that “an education was the ticket to the American Dream”. The blue collar roots came from our grandparents. They taught us how to curse in Italian, wax poetically like Joyce, and dance to Marvin Gaye, all while sprinkling in the Yiddish word or two.

How about another example of diversity?

Cherry Hill was home to the combination Chinese restaurant/ Jewish delicatessan, Ginsberg and Wong. Few places were as rich with diversity as Cherry Hill in the 70s and that experience has had a profound impact on me. So...

...if you ever see me dancing to the O'Jays at a Bar Mitzvah or playing street hockey in Orange County's Little Saigon, don't think of me as odd.

I just grew up in Cherry Hill.

Texas or California? WWRRD ?

America's #1 Mortgage Broker/858-777-9751 — Sat, 11 Jul 2009 03:16:01 -0500

Many Californians who are close to me have heard me query this; " If the last 50 years were the 'California half-century', will the next 50 years be known as the 'Texas-half century?' " I've had this conversation with Texas-phile Jeff Brown, mortgage partner Sean Purcell, and Texas buddy and money manager Nick Ripostella.

My thoughts:

1- While I warned that Texas' property taxes were a reason not to invest there, it appears that California's "buy now, pay later" approach (Proposition 13) is broken.

2- California's march to socialism is an experiment gone awry. If left unchecked, it will penalize the net producers in favor of the net consumers. That penalty will drive producers to a state like...well, Texas. Sean Purcell's argument was that the creative genius in California (ie- the Hollywood types) are decidedly liberal and would never leave. My counter to that argument was that those creative types are still capitalists at heart, despite what they portray to the public.

3- Texas is more business-friendly and hell bent on a constructive immigration policy that continues the American tradition of new immigrants pushing the whole economy upwards instead of the California model of vote-buying through appeasement. Texas' focus is on assimilation while California's is on victimization.

4- While I believe Texas is advantaged today, California leads the nation and arguably the world in intellectual capital and innovation. We thrive in spite of the actions of our obstructionist Legislature. This (admittedly "homer") idea maintains my belief that California will eventually prevail.

A VERY respectable periodical agrees with me. Continue reading

Active Rain Day at Del Mar (We're Back !)

America's #1 Mortgage Broker/858-777-9751 — Tue, 07 Jul 2009 18:26:05 -0500

Do you remember this party, from 2007 ? Active Rainers from all over the country came to the World Famous Del Mar Race Track to enjoy thoroughbred racing in our private infield pavilion. We had a buffet lunch and a free concert followed the races.

We're doing Del Mar again! From Meetup:

It's an ALOHA theme for our annual "Day at the Races" event, scheduled for August 14, 2009. We'll be in the Pacific Pavilion (in the infield) enjoying our sumptuous lunch buffet (ice cream included). The races start at 3PM and betting windows are right in our private pavilion. Soft drinks (and lunch) are included in the $29.95 price. No host bar is available with World Famous "Del Margaritas and Del Martinis" served.

After the races, Southern California reggae band Common Sense will be playing and is free to everyone.

This is a chance for you to meet other real estate professionals in a casual, fun atmosphere. Tickets are $29.95 and are available on a first-come, first-serve basis. Reserve your spot today at Meetup. (only 30 spots available)

Don't remember the 2007 party? Well, here's what some folks said:

William Johnson:

A Glorious Magical Day here in Old Del Mar. Back in the 1940's Bing Crosby penned the Famous words to the "Where the Turf Meets the Surf " music and it remains the theme song today for the Del Mar Race Track, Thoroughbred Club...

...Marlene, Kaye and I tried our hand at betting and as lady luck would would say, "Better stick to Blogging". Yes, we lost all three races we bet on. We couldn't see the horses from where we were so we were betting the dark (guessing). After losing race 6 and 7 we went to the betting window and asked if this as the line to give to charity. They said it was so we sort of suggested at this point it just didn't matter, so we bet on three more losers

Jeff Dowler:

Lots of good discussion about blogging, of course, along with hearing about local real estate business in different areas. It was fun hearing about the adventures Joe and Rudy have had in their cross-country journey (they off to Riverside tonight and then to Las Vegas, with several other cities to follow). Those of us going to Blogger Connect are looking forward to the final meet-up in San Francisco on July 31 and August 1 (Rudy and Joe have lots of miles to cover before then). And the highlight, of course was the chance to see the RV, inside and out to cap off a terrific day at the races. Some folks even bet on horses and won (and some did not...we won't mention who they are, or the ones who bet on the wrong race - oops!).

Laurie Manny had some great pictures of our event.

Kaye Thomas:

What a great day.. Terrific people together in a beautiful location.. Del Mar is just a stunning place and deserves the name.. Where the Turf meets the Surf.. The day was overcast but balmy..

Marlene Bridges:

At the end of the day, I don't think any of us went home with more money in our pockets than we started out with...but we all came away richer by far. Each time we meet, it is a reunion of caring, like-minded, exuberant, stimulating, and supportive friends. We laugh together about our blunders and strategize together on our future plans. This is a vital, growing family here in AR. January 4, 2007 is my Active Rain birthday---one of the most pivotal days in my life so far. Thank you dear friends, Lynda Eisenmann and Gregg Franklin, for walking me through the sign up process and keeping me on track until I actually started participating in the Rain. Just like at the track - nothing ventured nothing gained...and there's so much to gain here on Active Rain.

Del Mar Racetrack is truly a Southern California treasure. Join your new and old Active Rain friends, on August 14th, 2009. Remember, this is an "aloha" theme party so throw on your brightest aloha shirt or prettiest sarong and celebrate the summer with us.

Reserve Your Spot Today before they disappear.

AREBOT.com Launch Could Revolutionaize Real Estate Brokerage

America's #1 Mortgage Broker/858-777-9751 — Fri, 19 Jun 2009 02:56:50 -0500

I talked about how I see potential in disclosing property offers to all parties, in an open, real-time marketplace. The discussion on Bloodhound Blog was predictably philosophical; xenophobia was displayed by some folks on Active Rain.

The Big Idea was that this added transparency might engender trust among the home buying public, the banks, Wall Street, and the Government regulators. What I hadn't considered was the benefits to the seller.

Sellers sometimes question if they see ALL potential offers on their properties.

AREBOT.com hopes to change all that. AREBOT.com announced its worldwide release on BloodhoundBlog:

AREBOT.com, which stands for the American Real Estate Board of Trade, is the name of the company that intends to open up the demand-side statistics, by voluntary submission of properties, to an online NASDAQ-like market.

AREBOT.com is not intended to be an “auction”. It is an open, transparent, real-time market. Each zip code will have a live “ticker” moving across the screen, displaying actual offers on homes. Each listed property will display a time-dated offer history. Entries are voluntary and cost nothing to the sellers of the home. The “price”, if you will, is that they offer the property on this transparent market.

The Company has authorized me to extend an invitation, to Active Rain real estate agents, to a conference call:

Wednesday, June 24, 2009 at 1PM RSVP on Bloodhound Blog

Why Buyers Don't Trust The Real Estate Industry

America's #1 Mortgage Broker/858-777-9751 — Thu, 11 Jun 2009 05:45:33 -0500

Buyers don't trust real estate agents, lenders, nor appraisers, because we willfully withheld material market data from them. I talked about this on Bloodhound Blog:

What If The Real Estate INDUSTRY Didn’t Control The Real Estate Market?

Please click the link and read the full article before you comment because you'll look silly if you don't understand the full depth of the problem and proposed solution.

Here's the problem:

We hid market information from the buyers while the Baby Boomers moved through the home ownership life cycle. A huge generation, yearning for “The American Dream of Homeownership”, assured strong demand for houses in the post-World War Two housing boom. Banks were all too happy to hand out money, even when forced to lend by the Government. Lew Ranieri saw a 25-year boom ahead and found a way to create a shadow banking system that could “bury bad loans”. Any agent dealing with a short sale understands the problem of buried loans because she’s heard:

“Well, we aren’t quite sure WHO owns this loan”

Kind of sounds like the forensic audit of Bernie Madoff’s books, doesn’t it? That’s what you hear when the jig is up on a Ponzi scheme: confusion, wagon-circling, and practiced deflection. It eventually catches up with the schemers. I’m firmly in the camp that no matter how many incentives we offer to stave off the inevitable forced sales, or to provide a middle-class tax cut, or to bribe the next generation of buyers, the simple fact remains that we have more houses than we need in this country…and the people just ain’t buying like they used to.

Here is a way the industry can solve the problem:

Prominently display the terms and dates of the rejected offers, verified by participating market professionals, in the MLS system, and you solve the demand side of the equation because you identify the “size of the market”. Share that information with the banks and they’ll start trusting you. Show it to the prospective buyers and they’ll throw their arms around you in joy. The sellers will “get real” about the market, also.

This is why it won't happen:

We all know that ain’t gonna happen because “The Man” doesn’t want to release his clutch on the market.

That’s the real problem. We don’t have a real estate market, we have a real estate industry created market.

Here is the final solution:

I met a guy last month who thinks he has a solution. It’s so simple it’s silly; an open market, like the NASDAQ, for real estate. Watch offers for houses, in real-time, be accepted or declined. NASDAQ Level Two Quotes go beyond the bid and ask; they show the “size” of the market for those prices. The implementation of that transparency greatly reduced the previous NASDAQ market manipulation, that stymied the individual investor to favor institutions. It isn’t perfect but exposure to that data makes the market operate more efficiently. Apply that model to real estate and you will quickly determine what the “real” market is for a property.

Personalized Audio Interviews (On CD)

America's #1 Mortgage Broker/858-777-9751 — Wed, 10 Jun 2009 22:22:51 -0500

I talked about how to use the principles of the Millionaire Real Estate Agent, when soliciting business from REALTOR partners, over on the Mortgage Cicerone. I suggested that originators implement a 33-touch program for REALTOR partners so that you stay in front of them. The Top of Mind Surefire system does an excellent job of co-marketing yourself, to both the REALTOR and the customer, post-closing.

What can you do, prior to closing a transaction, to demonstrate value to potential REALTOR partners?

I swiped the Loan Toolbox “Gift of Knowledge” idea and found a way to make it more relevant to your local market (and a helluva lot cheaper).

I like to conduct a 30-minute interview with a working, full-time REALTOR and distribute a CD of that interview it to my REALTOR referral base . It’s much more effective than the Loan Toolbox Gift of Knowledge idea because it positions you as the interviewer.

Here’s how I do it

June 16, 2009: CAMB North San Diego Happy Hour

America's #1 Mortgage Broker/858-777-9751 — Wed, 10 Jun 2009 17:36:08 -0500

San Diego REALTOR Soiree- June 23, 2009

America's #1 Mortgage Broker/858-777-9751 — Tue, 09 Jun 2009 20:25:42 -0500

What a great opportunity to relax and network among other San Diego Real Estate Professionals at the D Street Bar & Grill, in Encinitas, on June 23, 2009. There will be no educational agenda for this meetup; just good ol' fashioned fun and networking.

We're trying to "rebuild" the fun and educational times of two summers ago so please invite a friend or two

Location

D Street Bar and Grill

485 S Coast Highway 101
Encinitas, CA 92024
Change Place

How to find us
"You can always call me at 858-777-9751"

Do Loan Originators Consistently Market To Agents?

America's #1 Mortgage Broker/858-777-9751 — Sun, 07 Jun 2009 14:58:01 -0500

If you're an originator and haven't read The Millionaire Real Estate Agent, by Gary Keller and Dave Jenks, you're missing out on a great way to market to REALTORs. The cornerstone of the MREA plan is database management. The authors advise agents to "touch" their "met" database 33 times in a twelve month period. It's a highly disciplined approach and most real estate agents fail to implement it but they wish they could.

Mortgage originators traditionally do a better job at managing databases better than their agent cousins. Why aren't originators "touching" thier REALTOR database thirty-three times, then? If each "met" REALTOR, touched 33 times, can produce three purchase loans annually, a stable of 25, full-time agents can put an originator on the path to 6-7 purchase loans each month.

Consider this "touch plan" for marketing to real estate agents (opens in a new window)

Do We Have Duty To Our Customers?

America's #1 Mortgage Broker/858-777-9751 — Sun, 07 Jun 2009 02:06:42 -0500

Admit it. You’ve wondered if there was a lot of fat in title policies, didn’t you? I mean, how many claims does a title company REALLY get in this “nobody trusts anyone” market? We order a title commitment and the title company:

performs a detailed search of the property’s chain-of-title
mitigates most any risk
insures the title and earns an insurance premium.

One would think that this highly-regulated, extremely commoditized business would file premiums within cents of each other, right?

I received a direct mail piece from READ THE FULL POST

Mortgage Revolution Conference

America's #1 Mortgage Broker/858-777-9751 — Sun, 31 May 2009 20:13:39 -0500