"Times has been (sic) good" and I will testify to it. Truly, deals fell out of the trees from about 2002 until mid to late 2006. "Hello sir/ma'am, please breathe on this mirror and if we see some fog ... sign here and get the keys."
How do we survive on this forced fast of "sorry, we no longer offer that program"? Simple! We adapt and adjust just like we used to do! Homes are still being purchased, I know - we're closing almost all purchase loans ... about 15 per month. Loans are still available and it's not your fault the national mentality was, "Spend, buy and purchase for tomorrow we die!"
GUILTY! GUILTY AS CHARGED!!!
I facilitated a percentage of the "problem" we have today. I facilitated the ability for people to participate in The American Dream who never would have had that opportunity elsewise. Had we not listened to the cries and accusations that "the bankers are holding back the underserved market". Yes! I did! I helped people purchase a home who would never been able to do so without sub-prime mortgages!
And guess what?
95% of them are still in those homes making their mortgage payments!
THEY ARE HOMEOWNERS! Building equity, paying property taxes (in the states where that applies), voting because they now care who represents them, paying school taxes, feeling like Real Americans instead of second class citizens.
GUILTY AS CHARGED!
Did I profit from my efforts? You're damn right I did! I worked HARD and invested my own cash to tell people what WAS available to them. Did I "stick them in loans they couldn't handle"? Evidently not!
Even if our default rate matched the national average of 14% (of subprime loans) that would mean that 86% of those borrowers either purchased investment properties or primary residences that would not otherwise have been able to do so.
LET IT BE KNOWN that I am not naive, I do understand that some lenders put borrowers into subprime loans who should have been in conforming loans. I know that. But not all of us followed that pathway.
WE NEED A HERO
Someone has billions of dollars to put into the market. Someone understands that front-loaded interest and a 14% fallout ratio (of which a major percentage can be recovered) is still a fantastic ROI will turn their billions into multiple billions.
Ah, it's the tsunami I wrote about a few months ago. The only problem is all the people who can and should are frozen by fear.
FEAR. Pass the doughnuts, I think I'll work on my figure.
Bottom line ... I have previously blogged about King Cash returning to the throne. That day is no longer coming, it is here. The hiccup is that most of our borrowers are "cash strapped" which is a nice way of saying "leveraged to the eyeballs". I really agree with the term "credit crunch" because we have continually rewarded people for having bad financial habits and etiquette.
WE'RE ALL GUILTY
It is a season of help, a time of reckoning. We screwed up collectively. I have the answer and so do most of you but it will not likely be heeded. Instead of crying on each other's shoulders we must do what we can do. Offer great care and concern for our family of clients. Provide services better than we would expect for ourselves and, most of all, be forthright and honest in all of our statements and actions.
The End ... No, it's The Beginning
(Nationwide 85% of people who "didn't deserve that loan" are still making their payment on time and glad to own that piece of The American Dream. Furthermore 56% of those who are in adjustable rate loans can easily qualify for a conforming refinance with a fixed rate mortgage. Yet they are frozen ... by fear.)
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