Sunday, December 23, 2007
To see the building's website click here
To check out a couple of listings in this building, click here
Sunday, October 14, 2007
Some jumbo mortgages require as much as 18 months of the monthly payment be held in reserves after the closing. Post-closing reserves isn't money that is spent, or even drawn on in any way, it's money that is shown to the underwriter in order to prove that a borrower has enough cash after the closing to pay the payment even in the event of income loss. This reserve could be made up of IRA accounts, 401K accounts, cash value of life insurance policies, CDs, checking, savings, pretty much anything that is liquid. Equity in the property doesn't count, nor do non-liquid assets such as jewelry, cars and boats.
At a minimum, jumbo mortgages are requiring 12 months of the payment in reserves in order to qualify. In this mortgage market, cash is king.
Friday, September 21, 2007
Counter-intuitive though is why the 30 conforming (Fannie and Freddie) fixed mortgage interest rate has gone up a bit since the most recent Fed rate cut. The bellwether for the conforming fixed rate is the 10 year treasury bond yield. That has been increasing as investors have been selling off bonds the last few days. The reason for the sell-off is that investors worry that the Fed rate cut might kick-start inflationary pressures.
So, despite people's wish for the opposite, the Fed rate cut has negatively impacted mortgage rates for the short term.
Wednesday, September 19, 2007
Thursday, September 13, 2007
Now all No Income Verification loans are only available for the truly self employed. If you are salaried at your job, then this isn't the mortgage program for you. Also No Ratio, No Doc, and other Alt A lending programs are going to be limited to homeowners only. If you are a first time home buyer, you will probably not qualify for this programs either.
Credit score is King these days too. An excellent credit score will still enable home buyers to qualify for most of the programs out there, those will less than perfect scores should be prepared to apply for full documentation mortgages, thus limiting them to buying properties they can really afford.
Saturday, August 18, 2007
I guess the thinking is that Countrywide needs the rate slash to borrow money to continue it's operations as it's downfall would be a psychological blow that Americans won't be able to handle.
Friday, August 10, 2007
It's an interesting time to be a loan officer out there looking to build his book of business. I think this is an excellent time to establish myself and someone who is still in the game, who works for a lender who can close and fund (very important) the loan. It's a time to gear up and make those calls to possible referral sources that I've been putting off. To work with developers whose preferred mortgage broker may not be able to close the jumbo loan.
I think I'll be able to increase my book of business during this shake out.
Saturday, August 04, 2007
I just made the move a week ago, so I've been watching the news with interest as American Home Mortgage locks out it's employees (heard they did that, don't know for sure) and then shuts down completely laying off 7000 people.
Also Greenpoint Mortgage has stopped originating Jumbo (loans over the conforming limit of $417K) ARMS. That is a major part of my book of business here in Manhattan. Wells Fargo slashes it's Alt A programs, as does Wachovia. Wells Fargo's Alt A cutback only affects Mortgage Brokers, while Wachovia ditches Alt A lending altogether. Alt A mortgages are those in which the borrower falls between prime and subprime, but the borrower are closer to Prime borrowers, so this really hurts the homebuyer, who might be a small businessman, shop owners and the like.
Accredited's clean bill of health is pending.
Top brass at Bear Stearns says the secondary debt market is the most volatile it has been in 22 years. While Indymac's Chief Executive emailed people saying the mortgage-backed bond market is "very panicked and illiquid", driving Indymac's stock price down.
This next few months are going to be a roller coaster ride for us in the mortgage business, especially those of us on the front lines as we find out hour by hour what types of loans we can originate and what types are no longer available.
Tuesday, July 10, 2007
Here's the court documents from the 1989 case.
Monday, July 02, 2007
Wednesday, June 27, 2007
Why would anyone want to work with someone who wants them to act unethically? Now appraisers want to point the finger at other parties. In effect cutting a deal with the AG's office. Also in the Bloomberg article, Y. David Scharf, the attorney for Mitchell, Maxwell and Jackson (my favorite appraiser) dropped the word "lender" from his statement to focus entirely on the little guy - mortgage brokers. He emailed this statement for the Bloomberg article, "It is clear to me that the targets of the investigation are mortgage brokers along with anyone else who exerts any form of economic pressure on appraisers." He wouldn't want to upset big bad, powerful lenders would he?
I guess the next step is for mortgage brokers to point the finger at the real estate professionals, who will point the finger at their buyers, who will point the finger at the developers, who will point the finger at investors, who will point the finger at....blah, blah, blah.
Of course there a mortgage brokers AND lender loan officers AND appraisers AND real estate brokers AND the consumers themselves who have a vested interest in the rising values of real estate the past few years. To keep these people out of the real estate industry is a must. Those who engage in unethical behavior should be warned, those who commit crimes should be punished. There's no question about that.
What gets me about the statements that these two appraisers is their implied complicity while covering their asses while pointing the finger elsewhere. That's what needs to stop.
Sunday, June 17, 2007
Recently I've been working on forming my own mortgage brokerage and real estate brokerage with my business partner. It's called The Metropolitan Group.
Check out our name on toast.
Get your name on toast at Your Name on Toast
Friday, June 15, 2007
If you are dependent on your job for all of your psychological needs you may be leading yourself to a dangerous place regarding your self worth, and where you fit in the world at large. This can become especially dangerous and lead to unethical behavior with there is an ethical dilemma that has a major impact at work. Those whose entire lives are tied up into what the position on their business card reads, may not make the most ethical decision or take the most ethical action, if they think it will result in a negative at work.
There is also an interesting note on job dissatisfaction. The survey found that 60% of those surveyed believe that job dissatisfaction is a leading reason why people make unethical decisions at work.
Wednesday, June 06, 2007
Tuesday, June 05, 2007
They've hired a top dog who formed Citibank's coop lending and asked Jonathon Miller to push out some numbers on the size of the market (about 5 Billion USD), so perhaps they are getting comfortable with this property type.
Interesting for those of us who have been doing coop mortgages for years to see a lender making baby steps into this robust market.
Tuesday, May 29, 2007
Tomorrow I attend a workshop about reverse mortgages on coops, so I will know more about them and how they work.
One thing that comes to my mind with these mortgages is: Is there really that much liquidity in the market that institutional investors are willing to just sit on a loan for x number of years without collecting any payments until the loan is due? That's incredible to me.
Wednesday, May 23, 2007
I'm sure this is just one of many partnerships to pay your mortgage this way. I think Citibank also does the same thing with its credit cards too.
Go get those miles and take a trip, or wallow in more debt at a higher interest rate, the choice is yours Ms. American Consumer.
Thursday, May 17, 2007
For more on this check it out here.
Wednesday, May 16, 2007
By interesting, I have an opportunity to hear what my competition is telling their clients. Today was interesting. I had an appointment with a prospective buyer to show her the apartment in the listing below. She called today and canceled. The Washington Mutual loan officer with whom she is working told her that a 20% down payment was too much.
Perhaps the prospect doesn't have the money. That would be understandable, one needs about $66,000 to buy this apartment ($44,000 down payment and $22,000 in post-closing reserves). That's a lot of money.
But if the loan officer actually did tell her that putting 20% down on a property is foolish, then the mortgage industry has not learned from their mistakes. Since when is it a problem to actually have some equity in your home?
Sunday, May 13, 2007
Friday, May 11, 2007
Check it out here.
Thursday, May 03, 2007
I like the following paragraph from an article from the Ethical Lending Foundation to more clearly define fiduciary responsibility:
The industry of mortgage lending is at a historical crossroads. It can either become a professional group with fiduciary standards or it can remain a retail establishment in which most of the burden of information is with consumers. Yet, they can no longer have it both ways. Yet, let us be clear that mortgage loan originators working at all types of lending institutions can owe fiduciary duties without representing to consumers that they are finding them the “best loan” or getting them the “best result.” A fiduciary standard simply would not put this burden on loan originators. By way of analogy let’s clarify. Medical doctors, lawyers, and Realtors do not have to promise that they will get their clients/patients the best surgical results, the best legal results, or the best deal on the house in order to discharge their clear fiduciary duties. Instead, they are promising to do the best job they can; to fully inform their clients of all relevant information and risks; and to carefully make sure that their clients have been provided with the necessary tools and understanding to make a fully-informed decision. Mortgage brokers, bankers, lenders, and consumer finance companies could easily adopt a fiduciary standard for their loan originators if they chose to, and it would be both practicable and fair.
It only makes sense to lead the way, and let the Mortgage Bankers and Lenders languish in the netherworld of non-disclosure similar to their hiding their fees and compensation.
Tuesday, May 01, 2007
Friday, April 27, 2007
Wednesday, April 18, 2007
So this moves the mortgage lending arms of national banks out of the reach of the individual states and into the loving arms of the Feds.
The New York Times has the story here.
I don't know what this means for borrowers who are losing their homes due to foreclosure. Where's Willie Nelson when he's needed? Who going to put together the rock concert to bail out homeowners? Come on Hollywood, flex those money muscles.
Thursday, April 12, 2007
It was an interesting educational conference for me, though it seemed as though many attendees wanted a forum to air their grievances with the subprime foreclosures throughout the state.
A couple of thoughts about the conference:
First off, is this a human rights issue? I can see that shelter is a human rights issue, but is home ownership? There are most likely some discrimination issues afoot. From the data it seems as though minorities have been placed into subprime mortgage products far more, particularly African-Americans and Hispanics who appear to make up the bulk of the subprime borrowers. There might have been other products for some of these borrowers.
I don't think this is a human rights issue up there with hunger, shelter, false imprisonment and other basic human rights. I'm not trying to lessen the impact, nor mitigate the blame, I just don't think it falls under this category.
The other issue that I heard frequently is a 6 month moratorium on foreclosures. Even Senator Clinton is calling for this in Congress. I don't know if this is a solution either. There are some borrowers who have taken out loans that they cannot repay, if this is the case, these loans should result in foreclosure. I don't know if it's the lender's fault for loaning the money to them. There are others who are victims of fraudulent colusion between real estate brokers, mortgage loan originators and appraisers who may have originally overpaid for their property (how they didn't check on the internet for comparable sales is beyond me), these homeowners should certainly seek some relief until a solution is found for them either dealing directly with the lenders or with a regulatory agency.
Thursday, March 29, 2007
So if the disclosures are confusing to consumers, and they don't understand the Good Faith Estimate and the Truth-In-Lending Disclosure, is more of the same the answer? Wouldn't it be a better response to try to simplify a document that at more than one closing I've attended has been described by the borrower's attorney as "it's confusing, just sign it."
I guess it's one of the those cases of "it's going to get worse before it gets better."
Monday, March 26, 2007
They are keeping one of the units as their home. Currently they have 2 mortgages totaling more than the value of the remaining condo that they own. However if they payoff the Home Equity Line of Credit the proceeds from the sale of the other side of the house they are making a condo, then the existing first mortgage is less than 75% of the value of the condo they are continuing to live in. Confused yet?
So if I can get the existing lien holder to allow the change in property type and transfer the lien to just one of the units instead of the whole building, that might be a solution. There are, however, complications. First off, the mortgage is being serviced by a different company that the original lender, so that means dealing with 2 entities on the issue.
Also a change a property type effectively puts the mortgage in default and the lender could call in the whole note forcing the payment of the entire mortgage, which is a significant amount of money. More than the sale.
Thursday, March 22, 2007
A client of mine bought a side by side duplex last year on Nantucket Island where he lives and works. It was a great rental property. Now he has changed the property type to 2 condos and sold one of them for $510,000.
That's less than he owes in total against the house, but the appraisal on the other half, which includes a separate studio/ workshop (meaning, no heat) is $750,000.
Here's the deal. Refinance the half that he still owns keeping the mortgage high enough that he can pocket most of the proceeds from the sale, while paying off the first mortgage (5/1 Interest Only) and the Home Equity Line of Credit against the whole property.
It gets trickier...the borrower's credit score has dropped from 698 to 648 in the last few months.
As a Mortgage Broker who works with investors, this is exactly the kind of deal that turns me on and lights me up.
I'll blog the solution as soon as it's approved, don't want to jinx it.
Thursday, March 15, 2007
Tuesday, March 13, 2007
46% are young professionals, 20% are first time home buyers
78% are looking for a home for themselves (primary residence), 12% are looking for a second home
45% want to buy in a high rise building, 27% want to purchase in a low rise building
73% want to pay under $450,000, although 1% is willing to pay over $3,000,000 for their home
It seems that the luxury buyers were unwilling to register for this survey, and may be under-counted.
It's not so different than I might have expected, but it's nice to look over the data and establish a marketing plan.
Monday, March 12, 2007
You are The High Priestess
Science, Wisdom, Knowledge, Education.
The High Priestess is the card of knowledge, instinctual, supernatural, secret knowledge. She holds scrolls of arcane information that she might, or might not reveal to you. The moon crown on her head as well as the crescent by her foot indicates her willingness to illuminate what you otherwise might not see, reveal the secrets you need to know. The High Priestess is also associated with the moon however and can also indicate change or fluxuation, particularily when it comes to your moods.
What Tarot Card are You?
Take the Test to Find Out.
Straight from the IRS:
Home acquisition debt is a mortgage you took out after October 13, 1987, to buy, build, or substantially improve a qualified home (your main or second home). It also must be secured by that home.
If the amount of your mortgage is more than the cost of the home plus the cost of any substantial improvements, only the debt that is not more than the cost of the home plus improvements qualifies as home acquisition debt. The additional debt may qualify as home equity debt (discussed later).
You buy your home within 90 days before or after the date you take out the mortgage. The home acquisition debt is limited to the home's cost, plus the cost of any substantial improvements within the limit described below in (2) or (3). (See Example 1.)
You build or improve your home and take out the mortgage before the work is completed. The home acquisition debt is limited to the amount of the expenses incurred within 24 months before the date of the mortgage.
You build or improve your home and take out the mortgage within 90 days after the work is completed. The home acquisition debt is limited to the amount of the expenses incurred within the period beginning 24 months before the work is completed and ending on the date of the mortgage.
Friday, March 02, 2007
Wednesday, February 21, 2007
Their bullet points are:
1. The same large-scale consolidation that has taken place in the banking industry itself would likely occur in the real estate business.
Fewer entities conducting real estate brokerage would mean less competition. The result: fewer choices and higher costs for consumers.
2. An additional effect of the proposed regulations would be pressure on bank-affiliated real estate brokers and agents to market and sell other financial products such as insurance, securities and credit cards.
3. Banks could share private consumer data obtained in real estate transactions with their affiliates and other third parties business entities.
4. Banking conglomerates would have unfair competitive advantages. These financial institutions that could operate real estate brokerages under the proposed regulations would benefit from access to capital at lower rates – thanks to federally insured deposits. That benefit is not available to local real estate companies.
5. According to a J.D. Power survey, 28 percent of home buyers had problems with their lenders. Those problems included errors in closing documents, miscommunication of loan terms and unavailable or unresponsive loan consultants or mortgage brokers. That means almost one in three home buyers did not get adequate customer service just during the loan process. How will they be better served by banks during the much more complex process of buying or selling a home?
Of course, it piques me to read #5 on their list. I'm not saying it's not correct, it just always bothers me that lenders aren't doing their jobs to the best of their capabilities.
As a Mortgage Broker who doesn't work for a huge company and works hard to compete in the marketplace, I agree that banks owning real estate companies is a mess. However, there has been an erosion of the seperation of banking institutions and commercial activity for some time (thanks to Sandy Weill & Citigroup when they purchased Traveler's Insurance) and it looks like it's going to continue.
I love the independents. And thankfully here in New York's wacky real estate market there seems to be some room for them...for now.
For the rest of this article, click here.
Monday, February 19, 2007
Friday, February 09, 2007
Wednesday, January 24, 2007
There are still many people in the mortgage business who are more interested in collecting high fees, than getting the deal done. Still too many order takers, who are little more than telemarketers. By focusing on a sub market, and knowing everything one can about their chosen area of expertise, whether it's new construction, coops, condos or mixed use buildings, one can develop a mortgage business that will be profitable and productive.
Sunday, January 07, 2007
Generally speaking, if the lease on the land runs longer than the term of the mortgage, there shouldn't be any problems. Often these leases are for many years, such as a 99 year term. Best to get a copy of the lease, read the terms, calculate any rent increases during the term of the lease and find out the expiration date.
It's not the most common type of building, but it's common enough to finance.
Wednesday, January 03, 2007
I've never done any business with them. And don't have the skinny on why they are shutting down exactly, but I found it interesting.