MortgagesUndressed

This is interesting. Remember, if you fill out a form at these types of websites, you become a lead. A lead gets sold, often several times. Don’t do that. CLICK HERE

To interpret for you: If you had to lock and followed the experts advice; 13% would say don’t lock - rates are going down. 37% would say lock, rates are going up; 50% say they will stay the same. So, what are you to do? These are experts folks, follow their advice, whatever you think it is.

It makes it more enjoyable for me. It fulfills one of the reasons I started this. Mind you, only one of the reasons. Another, to make money. I have to laugh with some of my friends that ask, how are you going to make money with this?

Wait and see, it will be good.

Larry Cragun

PS: LJ will shoot me if I tell too soon. So maybe I will have to plant some hints here and there.

I am going to pass on a little thing I learned a long time ago. Know your banker. Let them know you. This has been an important thing for us over the years. We never make deposits at the drive through. We go in, smile, take time to chat. We send the bank customers for seconds, we help them.

Our bank knows us. In return, we have had an edge of trust when we have needed something. Try it. You will like it.

Larry Cragun

I was approached yesterday by one of the faithful 25 visitors to the site. He had been turned down for his loan. It turns out that neither he or the lender did a good job. I quickly drilled him with the questions that are important and to my dismay learned he had omitted disclosing about $60,000 in cash and accounts receivable that would be in shortly. This would have been the difference in the approval. He also didn’t disclose about a million dollars in personal assets.

When I say tell it all, tell it all. The good and the bad.
Larry Cragun

OK it is still a small crowd. You can help that. Thanks.

The question. My FICO score dropped from nearly 800 to just under 600. How can that be? I have no late payments and only 1 recent inquiry.

The answer is the same for him as it is for many: the balances on all the credit cards went way up. This is a credit score killer.

In this case it brings out a couple of new twists. First, the cards are used for business. To purchase inventory. This is not a good idea. What I have done with Key Bank is get a business credit card for situations like this. It isn’t reported to the bureaus and doesn’t affect the score.

This is also a perfect use for an equity line of credit. This borrower could have easily accomplished either, especially with a near 800 credit score.

Keep those balances under 20% of the approved credit limits.
Larry Cragun

More bilingual loan officers needed.

This headline in InsideBayArea.com inspires the delivery of an article I have been planning on since I started. I wish I had 10,000 readers, because it is a subject that really gets me steaming. Actually, I am a mild manner sort of guy. Consider steaming as luke tepid steaming.

I also think I may tick off some folks, but so what this is a pet peeve of mine.

I have said we had about 100 loan officers at the time we shifted to the dot.com business. We had numerous files from many cultures. Our most common name of closed files, Nguyen. You name it, we had it. Some of the folks became my best friends. As I think of Chin Lu, Jane Ninh, and how about this one (Loan Nguyen) I remember them fondly.

But one thing that could keep me out of the mortgage business again is the trouble that brews from some of them. Here are some facts:

Some people of the people that don’t speak English put so much trust in a loan officer from their own culture they get flat out rate raped. It happened over and over and over. I hated it. I had a maximum of 3 points people could be charged. That is pretty darned liberal. I threatened to fire anyone that hit that high number without a real good explanation. We once had a loan close for $239,000.00 and the check from escrow came in at $14,800.00 I almost had a heart attack.

Rather than confronting the loan officer I decided to follow the trail. I first called the client. He didn’t speak English. I don’t speak Spanish. Now what? OK, I went to the Escrow company. I wanted to see their files. I found an order to pay the loan officer directly, outside of my company. In asking Escrow management about this, they proudly noted that they had refused. I asked if any of them spoke spanish? No. How did they close the file? They had my loan officer do the explanations. WHAT????

So from application to funding, the only one person to speak facts to the borrower was the loan officer. She’s gone. In fact she is in so much trouble for this and other things, she is in Venezuela now. At least the last I heard that is where she is.

So what did I do? I sent the customer a check for $14,800.00 and fired the loan officer. Three weeks later someone called me that spoke english. They were calling about the check. They were afraid to cash it. This borrower paid nothing down. How could they get this check back? How? Because the loan officer had worked it through gift funds, rebates, seller paying closing costs, etc. By the way, the loan officer had a partner that was an agent.

Actually we do need more honest bilingual loan officers. We also need certified, real estate and mortgage trained translaters. Hospitals have them. Real Estate transactions need them also. Since we are multi cultural we need documents in Russian, Spanish, Chinese, etc.

Larry Cragun

I am grateful for the few viewers we have.

I notice that we have about 37.5 visitors for each subscription. I wonder why that is and if that is standard?

Anyone using RssBandit?

A few days ago, Ian H Ritchie, wrote a very inciteful letter to the Editor, to the Seattle Times. He referenced a July 7th article by the Seattle Times on this markets real estate getting hotter and prices going higher and higher. His bet is that it will continue. He mentions all the angles and ideas reasoning the boom and considers them irrelevant.

Ian says famed economist Thomas Sowell has come up with the right answer.

“In Seattle we have the “rare trifecta” at work. It is as simple as water, mountains, and liberals. Mountains and water limit the building areas surrounding us and create natural borders and barriers. Liberals then attempt to eliminate much of the rest of the building areas by increasing lot sizes and setbacks from wetlands and streams and rural areas. If Seattle stays as liberal in the future as we are today, your retirement is your casa and it will only get more valuable.”

Thanks Mr Ritchie and Mr Sowell.

What forms the rare trifecta in your area?

Larry Cragun

View related articles: “the land grab”

I really love the Sellsius blog. They have a great posting that just went up. Click here and see it. Lar