Georgia FHA Home Loans - (& Opinion)

On your street. ONLY the street on which you live (not the entire subdivision and not the entire city) how many homes are currently IN foreclosure - as in have been advertised in the newspaper for sale and how many total houses are on your street?

There are 62 houses on my street and 0 are in the actual foreclosure process.

Keep in mind that mortgage are considered to be "in foreclosure" once the owner has completely missed one payment. What I am asking about is how many homes have actually been ADVERTISED FOR SALE UNDER POWER.

"Mr Obama said the government needed to 'stop the unlicensed, unregulated, fly-by-night mortgage brokers who are hoodwinking low- income borrowers into loans they can’t afford'."

Unlicensed???? Unregulated???? What PLANET is this guy from? Oh, he means the FEDERALLY CHARTERED BANKS! Those silly politickens always get those unregulated lenders confused with mortgage brokers and lenders. 

I bet five years ago he was screaming because poor people were not being treated fairly by the evil Republican money machine and their dreams of home ownership were being squashed because they couldn't qualify for loans to own their own home so they were being victimized by the wealthy investors and held into poverty by being denied their RIGHT to own their own home.

Of course you won't hear that on the evening news. You won't read it in the big blogs. But by gosh we can publish it here! So if you've sold anything in the last 60 days please share it with us here. Now that I've put this out you better speak up or we'll look like a bunch of losers ;)

R. Palermo sold a new construction home last week for $550,000 in a $300,000 neighborhood. We have closed 32 deals (combos counted as one loan) in the last 60 days (that's with 4 originators thank you very much).

What have YOU done?

Once I found out we could link a video blog here (thanks to Bryant Tutas and his "I'm Gonna Sell A House Today") you all now get to hear my southern accent and see me pounding the podium about the condition of our great industry. If you have any complaints please contact my managing agent, Mike Tyson.

One thing I find is that to say everything I want to say about the market today and how I truly believe it was created and fueled by the media for the insane purpose of toppling the largest industry in the nation is that I need hours of video and a research staff. Some of the things I say are inflammatory and I realize this. People still are not even interested that this implosion was fabricated and perpetuated by the media until it became a reality and that the Chinese and other foriegn investment groups WILL BE and ARE buying the mortgages on YOUR HOMES because of the pansy little US investors who pulled out their funds.

My challenge still stands for anyone to show proof positive that any REIT or HEDGE FUND or any other major investment group lost ANY MONEY for the sole reason that they invested heavily in the subprime mortgage market. We'll never see that because it didn't happen. A Time Magazine article recently reported that the percentage of subprime loans in default has not changed. The number of subprime loans in default has changed because there are more subprime loans that any time before. But let me tell you that a 12% default ratio on 500,000 loans is the same PERCENTAGE default as 12% of 1000. Only funds with bad management would have blown that one.

Let me show you EXACTLY what I am talking about. Bear Stearns (5 year chart) and Lehman Brothers (5 year chart) were buying MASSIVE numbers of high risk loans - even higher risk than REIT's like my old partnership NOVASTAR. Guess when BS and LB started losing money? JULY 2007! Why? Because all the sissy pants little inexperienced new money baby investors on Wall Street bought into what the media said. This was not the media reporting on a condition that HAD happened ... it was the media creating and fueling FEAR OF THE FUTURE of what MAY HAVE happened!!!

Unfortunately, knowing my fellow countrymen the way I do, another really bad thing happened that caused a spike in the number of foreclosures: entitlement. That's right, the welfare mentality created by the socialistic element of our governing bodies gave unspoken permission to the lower rung of our social scale to stop paying their mortgage payments when certain members of Congress began a wholesale attack on the mortgage industry and even calling for a BAILOUT!

LET THERE BE NO DOUBT! I am very angered at the media and these members of our ELECTED OFFICIALS who refuse to put the blame squarely where it belongs. Going back after the media is not new for me. I've been doing it since before I came to Active Rain but here are some articles I've posted here on AR over the months about just this subject. "The Baby, The Bathwater and The American Dream", "CanYou Hear That Distant Rumble? (4/14/07)", "Still Mixed Reporting On The Real Estate Market (4/4/07)", "What a Ride, What a Ride! (3/16/07)", "It Was A Minor Correction (1/26/07)", "What's This I See? (1/25/07- compares the timing of media reports to a decline in real estate activity", "Stop The Bleeding (1/4/07)" and "Starbuck's Has Nothing To Do With Mortgages (10/27/06)" is as far back as I am going for now.

Watch the video. Understand that it has holes and gaps in information because of time constraints and please don't be too shy to offer your comments here whether you agree or disagree.

People this is not a joke. The American media through a ceaseless tide of lies and deception perverted by a misuse of data has frightened the timid and created a stampede which could end in the wholesaling of America. Not only is China buying America but so are many other international investment groups - one mortgage note at a time.

One of the problems is that much of the purchase of mortgage backed securities was funded, during the last 1/2 dozen years, by greedy, inexperienced, new money investors.  These "nuevo riche" and neuvo wanna be's poured billions of dollars into REIT's and other investment vehicles and were making returns in the mid double digits for many years. When the media attack on the fabric of America began to wear down on these frightened little yellow bellies they started pulling out their investments leaving huge gaps in funds like Bear Stearns and Lehman Brothers to name a couple of the top buyers of subprime mortgage.

Let me repeat: THE ONLY MORTGAGE CRISIS THAT EXISTS TODAY WAS MANUFACTURED, PACKAGED AND SOLD TO AN IGNORANT AND FRIGHTENED PUBLIC BY AN ANTI-CAPITALIST MEDIA WITH AN AGENDA TO BRING DOWN THE LARGEST INDUSTRY IN AMERICA. And again, as I have challenged, I want ONE REPORTER to show us all proof positive that prior to September 11, 2006 ONE REIT lost funds solely because of their exposure to the SUBPRIME MORTGAGE MARKET.

Not going to happen because there are none. They didn't start losing money until the daily pummeling of the media took it's toll and frightened away the little baby investors who were afraid.

There was NEVER a global "real estate bubble". Many areas of America were and ARE still increasing in value like they have for decades. There were a FEW markets where the values were increasing at an unsustainable rate - NEVER the entire country like the media made you believe. The media started on the real estate bubble, moved to the hybrid loan, then to the subprime loan and ripped the major fabric of the American economy right in front of your eyes and there is still a string hanging out of your mouth where you swallowed the hook.

Furthermore let me correct THIS huge mis-assumption: The media would have you believe that every area of the nation has 1 in 600 houses FORECLOSED. This is absolutely NOT TRUE. Firstly and likely the most accurate number is that one out of 699 homes DURING THE LAST 2 YEARS has "entered the foreclosure process". This is HUGELY different from being FORECLOSED. Historically about 1 in 2000 homes ENTER the foreclosure process so we are up and it is sad but again - the media's fault. (See the paragraph about the entitlement mindset below.) The media DOES NOT UNDERSTAND THE FORECLOSURE PROCESS and do not want you to hear the truth.

Here is THE TRUTH about foreclosures as the media would not have you know:

More than 1 in 4 homes that ENTER the foreclosure process are NEVER FORECLOSED.
The FORECLOSURE PROCESS begins with the NOTICE OF DEFAULT which generally triggers activity on the part of the "homeowner". The lender can allow MONTHS for the homeowner to get back on track.
Once a property has entered the foreclosure PROCESS it can still be sold either retail or on a short sale, the lender can request a deed in lieu of foreclosure. The homeowner can refinance OR establish hardship with the lender and ask for FORBEARANCE or DEFERMENT! Lenders do NOT want to foreclose on ANY property!!!

Welfare/Entitlement Mindset

One of the reasons foreclosures are up right now is because there is a bottom level of society who truly believes that the "evil lender" put them in a loan to complicated for them to understand and now someone owes them. They believe that socialists like Hillary Rodham-Clinton will issue checks to pay off their homes and let them live in them for free. (That is NOT going to happen by the way - but it will get some communist votes.) The ONLY excuse for a healthy person not making their mortgage payment is because they do not want to and do not feel obligated to do so. In past times real people with the ethics of a slug would work two or three jobs AND deliver newspapers to meet their obligation. Not now - oh no! Somebody owes them and YOU are going to pay too buddy!

Now the worse news

A couple of weeks ago Novastar - my old partners - sold 1.4billion dollars worth of subprime mortgages. Previously these would have been purchased by Lehman Brothers or Bear Stearns or some other domestic investment fund. But because all the scared money little weak kneed domestic investors didn't think 20% ROI was good enough they had to sell out of the country. They sold to Deutsche-Bank.

It gets better ...

"Bank of China Ltd., the nation's second-largest bank, said it holds almost $9.7 billion of securities backed by U.S. subprime loans, the most of any Asian company."

And who is the newest REIT on the AMEX??? A nice little CHINESE investment group poised to purchase billions of your mortgage notes. The international investment community believes in American capitalism more that this current batch of citizens and our representatives and they WILL dominate this market very quickly unless people like YOU and I keep telling the truth and convincing old money to get back into real estate and stay there.

Why do you think Warren Buffet has even considered buying a chunk of Countrywide? Why do you think Bank of America just bought a chunk of Countrywide? THE CRASH IS NOT BECAUSE OF THE MARKET PERFORMANCE IT'S BECAUSE SO MANY PANSIE INVESTORS PULLED THEIR MONEY OUT AND WENT TO SUCK THEIR THUMBS IN THE CORNER.

I'll stop shouting now but I am TEED OFF! 

Okay. Putting my money where my mouth is really isn't a change. You see I have always offered free training to home buyers and real estate investors and agents and brokers. I've had a few agents come (they don't like to come unless they get CE's so I never bothered to get my classes certified). Mostly the people who have come are real estate investors and there have been thousands of them.

Home buyers? Maybe 100 at most. Usually one at a time.

So, people say they get taken advantage of by the bank or lender because they, as clients, don't know much about the mortgage business. This is DEFINITELY not my fault. But to prove my point, I challenge everyone to make this know. I will provide, at no cost to the attendee and no obligation for them to use my services, a detailed and intesnse 2 hour class on mortgages and how to use them properly.

I am multiply certified, heavily experienced in the mortgage industry, and have excellent communications and teaching skills. They WILL be taught and they will be taught the truth. I won't be changing the class from its previous state because it has always be a great class. What I will do THIS TIME is report back to you how many people attend. I will not spend any money on advertising but I will advertise on Craigslist, Backpage and Kijiji just to name a few.

I am willing to wager there will be less than 5 takers. Now I'm not talking about some dinky little First Time Homebuyer's class with donuts and coffee and a 1 year veteran loan officer. I'm talking about a full blown, highly intense 2 hours of massive training about mortgages and the finances surrounding them. How to avoid foreclosure and get a lower rate. How to negotiate closing costs and how to shop for a mortgage with intelligence.

In fact, I am willing to say that at the end of those 2 hours the attendee will know more about mortgages than 25% of the loan officers currently trying to get their old job back.

Send people to the link and let's count how many people show up. You see, it is my belief that Americans are MORTGAGE IGNORANT BY CHOICE. They don't WANT to know because they are so ignorant they believe INTEREST RATE is the most crucial part of the loan.

There will be a $20 seat reservation fee and I will refund ALL of it except the PayPal fee at the end of the class so they'll get back like $17.50 and about $500 worth of information (compared to some of the mortgage seminars I have attended.)

FREE MORTGAGE TRAINING CLASS FOR HOME OWNERS

Thursday, September 20, 2007 at 7PM SHARP
Marietta GA 30062

Everything you see is a result of the media. There was no mortgage crisis - it was created by the media. Sure it was fueled by bad management and spending such as 10,000 square feet of office space for $100,000 per month when 5000 square feet at $5000 per month would have done.

MEDIA CHALLENGE AGAIN - since no talking head has picked up on this: SHOW ME A MAJOR REAL ESTATE INVESTMENT GROUP THAT LOST MONEY PRIOR TO SEPTEMBER 11, 2006 BECAUSE OF THEIR EXPOSURE TO THE SUBPRIME MARKET!

Do not just say a name: show us the amount of mortgage securities they held, the amount of other investments they held, how much the management was making, their monthly expense sheet, and how much they lost.

Once again I will say that the people who pulled out of mortgage securities investments were NOT losing money until the media's constant assault on The American Dream finally scared some people into making knee-jerk decisions and running from the table not because they HAD lost money but because the MEDIA (show me a journalist who even mildly understands housing economics) assured them they WOULD lose money. For example there was a news story here in Atlanta last week where the reporter said 1 in 55 homes in Atlanta is in foreclosure. THAT IS A LIE. Has there been a retraction? NO! Will there be? NO!

Greenpoint losing money? NO! They were NOT losing money. They were experiencing DIMINISHING PROFITS. Why?  Simple: if you do not originate new loans you do not make money. LENDERS DO NOT MAKE MONEY IF THEY DO NOT ORIGINATE LOANS.

So here's the conspiracy theory: some major financial power conspired with the media to release negative press over and over and over until the scared investors (large and small) left the table. Once they left the landslide began thus eliminating the vast majority of mid-level lenders who were taking to much of a bite of the profit for this major financial power. Once the mid-level lenders are out of the picture the major financial power will step up to the plate and open the doors to lending again and will almost overnight be the savior and multiplied times wealthier than they are today and have a monopoly stronghold on the American economy. And this power may not be American.

SHOW ME WHO LOST MONEY PRIOR TO SEPTEMBER 11, 2006 

Now to keep rolling ... We live in an entitlement society. How many people do you think have stopped paying their mortgage NOT because they CAN'T PAY THEM but because the MEDIA said they have a bad mortgage and it's not their fault? How many people who have the welfare mentality already said, "That bad mortgage company was evil to me and put me in a loan I can't afford and the news said it's true so I'm just not going to pay this mortgage back because the government will come along and bail me out and I'll get my house or my payments for free. I'm gonna vote for Ms. Hillary because she wants to pay my house payment for me!"

Have you ever heard a sentence leave your mouth and seen a glassy film cover the eyes of the person you are speaking with? Over the years I have participated in many public speaking opportunities and there is nothing worse than being in front of a couple of hundred people and hitting your main point and hearing nothing but the echoing cough of a man way in the back. What we say, how we say it, why we say it, when we say it, and where we say it are all very important to projecting our meaning.

Some years ago my partner in a commercial lending venture reprimanded me for my method of delivery and added, "Sometimes I don't think you know how the things you say affect other people."

He was wrong. I knew exactly what I was saying, that it sounded harsh, may have been misunderstood and could have been said more softly. However, I carefully chose my words, watched my small audience for the time to deliver them and raised the volume of my voice when I said them.

When I was first learning to sell by appointment many years ago I learned how to take just enough control of the situation in a kind way without causing any undue stress on the client that I would have their attention. For example if I am in a client's home and the television is on I simply ask if it may be turned off so that I do not lose my concentration because everything they have to say is important to me. Another method is to arrive early to a cafe or coffee house appointment and pick the table and chair that are most like to have your client facing the wall (and of course your face).

Practice your conversations. Seriously! My staff always thinks I'm nuts when I say this but I actually talk into a digital recorder that I keep with me all the time. I listen to the words I use, the inflection I use and even how much of my southern accent I allow to slide through. You need every edge to provide the most accurate information to your prospects in a direct response to their questions.

How many of you have an issue with long drawn out runaround answers? For example if you ask what year a property was built and you get the story all the way from when it used to be a chicken farm but the lumber company bought it then turned it into a sawmill until it burned down and on an on. The answer I would want would be 2002 (or whatever).

In sales you are either selling or buying. Many times the salesman ends up doing the buying and that's where I like to have them. Good salesman make great clients because they "know how to play the game" but good salesman create good clients because they know what to say, how to say it, when to say it, where to say it, and why to say it. Taking control of the conversation is your job as a sales person. DOMINATING the conversation (being a space invader) on the other hand is not.

People do love to talk about current events. What people love to talk about more than anything else is something that they think they know a lot about. You will find yourself talking about the mortgage industry, the "real estate bubble" and the "downtrend in prices yielded from the market adjustment" if the person is so inclined.

This is not to say you need to ignore the conversation but it is to say you can take control. There just isn't much positive news about our industry from the media giants today. It seems, in fact, all the talking heads just want to help put nails in your coffin. Oh there are stories like the on in Sometimes The Media Makes You Smile but more likely than not they are bent the other way. Strange how no creditable journalist has accepted my challenge to show us any investors who truly lost money in the mortgage market. 

So when you meet your next appointment to take a loan application or show a home and they start repeating the negative news about the industry simply say, "Oh yes, I heard that but I've been so caught up with this Michael Vick thing that I have started following it instead. Let's go to Starbuck's and get an iced latte." 

The media has hated the mortgage industry for years. They don't care either way about banks and barely understand the difference. About two years ago a few journalists (read - not banking finance or economy professionals) started hating the mortgage industry in print and on air. Atlanta's Clark Howard, a travel agent turned know-it-all, blasted mortgage brokers for years until he had to eat his words and he did so on air. Lately, though, it seems he had a memory lapse.

ALL OF YOU JOURNALISTS AND WANT TO BEES, almost without exception, are writing about OUR industry with only a passing understanding. One talk show host here in Atlanta has emitted more incorrect information about the mortgage industry than any other I have ever heard and I do not listen to her Sunday afternoon show because she is so often so wrong. On the other hand there are talk show hosts here who are in the industry and understand it an deliver the truth: John Adams at the top of the list at accuracy of 99.99% of the time.

THIS TAKES US TO CNN, FOX and MSN to top the list.

SHOW US THE LIST of funds (REIT's, Hedge Funds, whatever) that, prior to September of 2006 when you screaming heads started wholesale terror attacks on the Real Estate Industry who were losing actual money BECAUSE of their investments in sub-prime mortgages.

DO NOT SHOW US A LIST of funds losing momentum, experiencing a decreasing profit margin or suffering losses or setbacks because of fund management OVER PAYING for MORTGAGE BACKED SECURITIES or losing investors to other funds paying higher dividends.

DEMONSTRATE TO US that the fund actually LOST MONEY solely because of their investment in mortgage backed securities. Numbers, dates, amount held in mortgages, other investments held and their performance must be posted. WE REQUEST A REAL, VIABLE PORTRAYAL of the market damage PRIOR TO SEPTEMBER 11, 2006

We await your replies. Refreshing every 5 minutes to see the new additions to the list....