Accountability, Technology, and Congress – Tweet Them!

It takes a significant advance in technology to get me to stop and say, “Wow.”  What I love about the Information Age is how many times a month I get to say, “Wow.”

Sometimes, the technology tools are complete overhauls of an existing system or model.  Sometimes they are a simple new use for existing cool tools.

I think Americans are done with petitions and  antiquated communication methods, such as faxes and email.

If you want to know what is happening in Congress, go to the Tweet Congress page.  You can see what your Congresspeople are doing and communicate with them (or the intern in charge of social media…whatever).  Send a Tweet.  See what happens.

This could be the dawn of a new era of accountability.  Or, it could be just another tool that makes my life easier.  Either way, “Wow.”

There are four business coaching slots still available.  Once they’re gone, someone has to retire or die for you to get one.  Technology coaching for non-technical people coming in April!  Learn more info@mangledmortgage.com.

Real estate success stories from the weekend

Many of my agents and clients are reporting great activity with both buyers and sellers.  Hearing about the success of others is always inspiring to me, so I thought a few pieces of good information would brighten the day for someone else.

Success story #1: An agent recently joined our office.  He was brand-new to real estate and started making phone calls, because that’s what we told him to do if he wanted to generate business (crazy idea…I know).  On his first night as a real estate agent, he found two buyers.  One of those buyers is an investor and is buying multiple properties for cash this year, in addition to using the new agent for a $2MM+ purchase of his personal residence (the personal residence purchase is the weekend success part).

Lesson: Make more phone calls.

Success story #2: An agent hosted an open house on Sunday and found five live buyers and one potential listing.  Because of the affordability level right now and the good press surrounding the new tax credit, buyers are out in full-force.

Lesson: The fundamentals in real estate don’t change when the market changes.

Success story #3: A seller who had been trying to get a short sale approved since last October finally got the lender’s approval.  Lenders are finally coming to terms with their situations and making better decisions than we have seen for the past 12 months.

Lesson: Persistence matters in this market.


I’m hearing positive stories every day, regardless of the market conditions.  We’re experiencing a “perfect storm” for buyers right now.  You never know when the bottom of the market is really the bottom until it’s gone.

www.mangledmortgage.com

We are in a depression and here’s why it doesn’t matter

I wanted to be the first to declare that we are officially in a depression.  You can read about it by clicking depression.

There is no clear definition of the point at which a recession becomes a depression.  So now I’ve said it and we can all get on with our lives.

It doesn’t matter because people buy and sell houses, regardless of what the economy is doing.  The Great Depression was an example of this.  There are always real estate transactions, even if you have to work harder or differently in order to find them.  If you surrender to the idea that real estate will always be changing and you will always have to adjust your tactics, you will be fine.  Every agent, investor, manager, and owner needs to accept this if they plan to survive this market.

If you need a kick in the pants or simply don’t know what to do next, I have a few coaching slots left.  I’m putting a cap on the number of coaching clients in my life because I like to do other things too.  Email info@mangledmortgage.com for more information.

Onward!

Jon

Make the deal yourself!

There are two types of properties my investors are considering right now.

1.  The properties that are “deals” as they are advertised.

2.  The properties that become deals after negotiating.

Can you guess which category holds the most deals?

Too often, I encounter pretend investors who tell me to call them when I find a screaming deal.  My response is always, “I’d be happy to.  Can you tell me exactly what a ‘screaming deal’ looks like to you?”  I don’t want to assume anything.

I know they’re pretend investors when they can’t answer my question clearly and concisely.  The person who says something about, “a little old lady that’s going into a retirement home and wants to give away the equity in her property” is not the investor for me.  That person clearly watches too much late-night television.

The person who tells me, “3 bedroom, 2 bathroom, brick house, in X school district that can be purchased for 80% of market value or less” is the investor for me.

Do you see the difference?

Occasionally, I do find properties that are great deals just as they are.  These properties go fast because the rest of the world can also see them.  The gold is in the properties where you have to negotiate a little bit.  My favorites right now are short sales because they’re a total hassle most of the time.  Most agents don’t like them, don’t understand them, and won’t be able to get them closed.  Buyers are told by their uneducated agents that short sales are too much work, so they shouldn’t bother.  I love them for those reasons.

Anywhere you find HARD WORK in the real estate sales business, there is usually a great opportunity.  Most agents in my life are not interested in hard work, so I don’t have much competition.

Foreclosures, on the other hand, are not the types of deals that excite me right now.  Most of them are in poor condition and will take too much time and capital to return to market value.

If I can get a better discount on a short sale, and the short sale doesn’t need any work done to it, why would I bother with a nasty bank-owned property that has no appliances and trash everywhere?

My investors have all asked the same question and are now on the short sale bus with me.

Where can I buy a copy of Mangled Mortgage?

Right now, the only place to buy it is right here. Email info@mangledmortgage.com and you’ll get a reply with easy payment options.  Books start shipping the week of March 9th.

Someday, you may be able to find it on the big online shops.  Until then, this is the Mangled Mortgage shop.

Mangled Mortgage is a book about foreclosures, short sales, and loan modifications written by someone who lives and breathes mortgage challenges every day.  Jon Sterling works in real estate sales Southern California, where he moved specifically because of the housing crisis.  Working in some of the most challenging markets in the United States, Jon’s team provides a wealth of experience and perspective for today’s real estate market.

Foreclosures are gone for good

Hardly.

Fannie Mae and Freddie Mac have both extended their eviction moratorium to April 1st.  If history is any guide, this will not be the last extension as the government works with the banks to straighten-out the housing mess.

The “freeze” on foreclosures began last fall when Bank of America, Chase, Citigroup, and Wells Fargo all put a halt to their new foreclosure filings.  The plan was two-fold:  The banks were waiting to see if they would be able to recover some of their losses with bailout funds, and they were buying some time to contact their mortgage customers who were in default to see if loan modifications would be a better solution.

From the first round of loan modifications, over half are in default six months later.  It’s safe to assume history will repeat itself here.  Many of the loan modification customers I have encountered are using the loan modification as nothing more than an excuse to stay in their house for free for a few more months.  They had no intention of paying before the modification, and they have no intention of paying now.  Let’s hope that attitude belongs to the minority of loan modification customers.

The big variable this week is the bankruptcy judges’ ability to “write down” the loan amount to make the loan affordable for a homeowner so he/she can avoid bankruptcy.  This is power the judges did not have before this week.  While it may seem like a good idea on the surface, the impact will be far-reaching.  Basically, this gives judges the power to decide the investor for the loans are having their equity in their investments reduced without any input from the investor.

Mangled Mortgage tells you everything you need to know about foreclosures, short sales, and loan modifications.  Order a copy today!

Foreclosure Coaching for Agents and Brokers – How to build a big REO business from someone who knows

One of my coaching clients made over $1.1 million in commissions in 2008 by focusing her attention on selling foreclosures.

Oh yeah…she won’t turn 30 for a few more years.

Whether your new to the business or well-versed in foreclosures already, the coaching program will make you better.  It costs less than the major competition and provides superior results.  No long-term contracts, no gimmicks, no inexperienced coaches.

If you’d like to learn how to sign-up for Jon’s REO coaching program, send a message to  info@mangledmortgage.com.

Check back for Technology Coaching…coming soon!

Foreclosure lists

Foreclosure List Update:

Most of the lists of foreclosure information are available for free from your county office where you’re searching.  There are many title insurance companies that can provide the information in an electronic format for their customers as well.  You will usually have to be a customer in order to get access through the title companies.

Update for agents and brokers:

Some of the asset management departments and asset management companies are no longer allowing their asset managers to assign listings.  Countrywide has had this policy for a long time already.  The reason behind it is the potential for an asset manager and a less-than-honest agent to be in cahoots for stripping a house of valuable items.  When the asset management company has a neutral employee assigning listings, it helps limit their risk.

For specific questions about foreclosures, foreclosures lists for your area, or industry news and trends, send a message to Jon Sterling at info@mangledmortgage.com

Foreclosure solution – affordable and sustainable

From the US Department of the Treasury on March 4, 2009:

“The Home Affordable Modification program will help up to 3 to 4 million at-risk homeowners avoid foreclosure by reducing monthly mortgage payments.  Working with the banking and credit union regulators, the FHA, the VA, the USDA and the Federal Housing Finance Agency, the Treasury Department today announced program guidelines that are expected to become standard industry practice in pursuing affordable and sustainable mortgage modifications.  This program will work in tandem with an expanded and improved Hope for Homeowners program.”  (links are mine)

This is a good start.  The important pieces to note are the ideas of affordable and sustainable. The affordable piece of the puzzle is already in place, even if it wasn’t by design.  The sustainable part of the program is going to be the tough one.  Nothing exists in a vacuum and markets are efficient.  As one solution looks like it’s working, it will have to be closely monitored so it doesn’t create bigger issues, like inflation.

Mortgage interest rates look good right now and they don’t seem to be going anywhere anytime soon.  Real estate prices are at an affordable level in most markets around the country.  The unemployment rate is definitely a concern right now because it impacts everything else.

The trickle-down effect of the Obama Administration’s actions will take some time.  It’s good to see that they’re taking action, even if nobody has seen anything like this before now.

For more information on the housing market disaster and what happens next, check out Mangled Mortgage by Jon Sterling.

50 year mortgage

I heard about the 50-year mortgage recently and it cause me to pause and reflect on what I had just heard.  Mortgages with long amortization periods have been touted as a possible solution to the housing crisis.  Personally, I have my reservations.

It’s very simple.  It’s a mortgage that amortizes over 50 years.  That part is easy.  The problem I had was with the basic math involved.

Average age of a first-time home buyer in the United States:

33, according to NAHB

30, according to NAR

We’ll split the difference and call it 31.5

Average life expectancy for people in the United States:

Men:   75

Women:  81

The simple math:

31.5 years old + 50 years to pay a mortgage = 81.5 years

Compare 81.5 years to the average life expectancy.

If a 50-year loan was the only way I could purchase a house, I think I would be a renter forever.  That’s a scary thought for a country whose economy just collapsed because of our dependence on the housing industry.

Food for thought.

www.mangledmortgage.com

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