TRUE INDEPENDENCE?

I am writing this to you on the 30th – crazy busy day and a great closing month. Every month I review my business  to find out which marketing startegies are working and where my loans are coming from.

DO YOU?
If not you should – start fresh in July! Just take out a sheet of paper and write ORIGINATIONS on one side and CLOSINGS on the other side. If you are technical use an excel spreadsheet.Create the following columns -Date- Name- Source- Loan Amount- Loan Type

Every time you originate ( not prequal) a new loan or one closes fill out your chartOn the first of every month go back and review:

What worked?

What didn’t?

Why?

Looking at my pipeline- originations for the month and closings one thingJUMPS out at me–“He or She that controls the buyer -controls the income of everyone else in the transaction”A long time ago I decided that person needs to be ME and my students. So I will very soon be releasing my RENTERS INTO LOANS system. Check out the 15 minute video at http://www.RenterIntoLoans.com

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DO YOU KNOW ANY OF THESE PEOPLE? YOU SHOULD !

It’s 9am and I just finished up a few hours of work before the phones go nuts. As I glanced over to my schedule I see that I have a lunch appointment today with Theresa from the bank I have one of my accounts.

I saw a few more interesting lunch and breakfast dates this week and wonder if any of these people are on your radar. If they aren’t they should be so let’s talk about WHO is referring you business. OF COURSE THERE ARE THE OBVIOUS SOURCES BUT…. What I want to share with you are some of the less obvious sources. We all go after Realtors, CPA’s and past clients right?  So let’s dig in and talk about some of those “overlooked” or maybe less obvious sources. Let’s start with Theresa. She works for a small regional bank that also has a mortgage division. I walked in one day to open a checking account and we started speaking.  I told her what I did but knowing that their bank was a bit conservative I asked her to lunch. These small banks tend to be very conservative and if someone’s ratios are a bit high or if there is even the slightest credit issue they will deny them. WHY SHOULD SHE GIVE ME A CHANCE? There are actually 2 reasons and you MUST keep both of these reasons in mind if you are going to be successful with these often overlooked referral sources.

  1. WIFM– She and everyone else is tuned in to WIFM which stands for WHAT’S IN IT FOR ME.  You need to always know what your prospects objections are. I have the ability to refer her clients. They do a lot of equity type lending and we don’t at our company. So this is a win –win.
  2.  I will NOT be “poaching” her clients. Since the company I work for is an independent mortgage banker we don’t offer checking , savings, car loans, etc. I can make her look good to her clients and she can maintain the relationship for her other services. Again WIN- WIN!

OTHER LOAN OFFICERS:  Many loan officers view others in their area as competitors but that to me is very limited thinking. There are many loan officers who specialize in Construction loans, 203 K’s, Reverse mortgages, Doctor loans and other niches. Why not get together with them and learn about their programs. When you have the opportunity to refer them you now can become viewed as a resource and a referral partner. They in turn can refer clients to you who may not meet their product lines but to whom you could offer an alternative.

RELIGIOUS LEADERS:  Regardless of your religion and even if you are a total atheist, religious leaders hold major influence in their congregations and in their communities. It is to their benefit to be a resource for their congregations. It is also to their benefit to have resources they can turn to when a congregant has an issue. Many have entire ministries set up just dealing with financial literacy and education. Others realize that the more homeowners they have has congregants the more solid their foundations are.

SMALL MOM AND POP BROKERS: There is a growing number of small real estate brokerages popping up. Many would truly appreciate having you as a resource. Many of these small brokers are ignored by loan officers, yet they can provide you with a constant source of loyal business.

DIVORCE ATTORNEYS:  This is pretty obvious but divorce attorneys are often dealing with cases that involve real-estate that needs to be refinanced for a buyout. In fact I just learned that real-estate is involved in 70% of divorces and that doesn’t even take into account the times the departing spouse wants to purchase a home.

CREDIT UNIONS:  These institutions are often a bit conservative in their underwriting although that is changing. Go back and re-read the Theresa section because that applies here too. Credit unions have the same concerns and issues and therefore you can provide the same solutions.

CREDIT RESTORATION COMPANIES: This one is truly a gem that I have NOT seen anyone else talk about. But since I am the BOOMERANG SPECIALIST it’s one that I am very focused on.  If you are reading this DON’T SHARE THIS WITH ANYONE ELSE OK? People go to Credit Restoration Companies because they are concerned about cleaning up their credit. So you already know they are motivated. Once they go thru the programs and get their scores they are released into the market.

But what if they were released to you? You now have a borrower with good scores who you can get pre-approved and turned over to a Realtor as a PRE APPROVED buyer. Smart huh?

Like everyone else they will be tuned into WIFM so make sure you let them know that you will refer all of the clients who need help over to them as well. ONCE AGAIN WIN-WIN@

HOSPITALS- Universities- LARGE EMPLOYERS WITH PEOPLE TRANSFERRING: If there are any Universities or  large Hospitals in your town get over there and introduce yourself to their personnel departments. Most of these employers, Universities and Hospitals constantly have people coming in as new employees.

APARTMENT COMPLEXES: Now this one is one that I am SURE you have overlooked.  Of course I realize this is where the renters are and that you may even be mailing to them like I lay out in my RentersIntoLoans.com system. But what I am talking about here is actually going to the rental agent and introducing yourself. I would not have believed this if it didn’t happen to me personally, but many of these rental agents are thrilled to let you advertise to their tenants and allow them to become homeowners. WHY? Well if you think about it rental rates continue to go way up and many of these communities – especially if they are full- will allow their current tenants to break their leases early since they have more than enough on their waiting list they can rent to at an even higher rate. One community near my office just allowed me to put fliers up in the community offering my services. I was the only one who asked- so try it yourself. The worse thing to happen is they say no.

PRIVATE LENDERS and PRIVATE INVESTORS WHO REHAB HOMES: Private lenders often lend for terms of 1 year. When the year is up often times these purchasers or investors will need to refinance.

Private investors who rehab homes are also a great source of new business that almost no one goes after. Assuming they are rehabbing homes they will often find buyers and those buyers need our services.

So the bottom line is to go where there is less competition. Now that you have a few new places to think about go out there and start marketing your services. Each of these places could account for that one extra deal you wanted to close last month.

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THEY’RE BACK- WILL YOU KNOW WHAT TO DO WITH THEM?

This is a reprint of an article in the San Diego Tribune

SCROLL TO THE BOTTOM IF YOU WOULD LIKE TO LEARN HOW TO EXPLODE YOUR PRODUCTION WITH THIS NICHE!


Foreclosed? Maybe you can buy again

Home ownership remains goal for many who went through foreclosure, short sale during recession

When Chad Sanfillipo got the keys to his house in Ramona last year, he had come full circle in the real estate market.

After losing his home to a short sale during the crash of the housing market, Sanfillipo was once again an owner.

“It felt so exciting to be able to buy again, to have something I own,” said Sanfillipo, 45, who rented for a couple of years before a bank would lend him money again. “There’s no landlord or rent check. I get to say what I get to do with my house.”

Sanfillipo, a systems engineer, is one of roughly 116,000 San Diego County residents who had either a short sale or foreclosure between 2006 and 2014, before and after the Great Recession, according to CoreLogic, a real estate data company.

The good news for Sanfillipo and others who lost their homes during the downturn is that there’s ultimately forgiveness in the lending market. Each month, thousands of San Diegans who went through short sales or foreclosures are completing waiting periods that render them eligible to once again apply for government-backed loans. In the worst case, some must wait seven years, but others can get new loans in just one, depending on whether they go through the Department of Veterans Affairs, Federal Housing Administration, Fannie Mae or Freddie Mac.

People who lost their homes during the recession but own again are called boomerang buyers, and they’re becoming a larger part of the market.

“The scales have tipped,” said Mark Goldman, a loan officer at C-2 Financial and real-estate lecturer at San Diego State University. “Instead of having the majority of properties be distressed sales, the formerly distressed sellers are coming in as buyers who are recovering, so not only is the market recovering, the buyers are recovering.”

Boomerang buying is becoming a nationwide movement. The National Association of Realtors says that 9.3 million homeowners underwent foreclosures between 2006 and 2014. Already, 1 million of them purchased homes again, and an additional 1.5 million will become eligible over the next five years.

California has the biggest share of potential boomerangs, with 1.68 million foreclosures and short sales from 2006 to 2014. Already, 250,000 of them are once again property owners, the association reports. Through 2023, that number is expected to increase by 308,000.

Ken Fears, the association’s director of housing finance and regional economics, said California is leading the way not only because of its sheer size, but also due to its unique economic factors during the downturn: A steep run-up in prices followed by a sharp drop in employment.

“There were much larger foreclosures and short sales in that region,” Fears said. “It creates an opportunity today with more of these former short sellers and people foreclosed to return to the market.”

Generally speaking, Fannie Mae and Freddie Mac won’t back a loan for someone who had a foreclosure within seven years, or a short sale within four years. There are exceptions that reduce the waiting periods, but they apply only if someone can prove that extenuating circumstances affected their ability to pay.

The FHA, which requires only a 3.5 percent down payment, will make most people wait three years after a foreclosure or short sale, but those loans require personal mortgage insurance, no matter the down payment size. The shortest term is through the VA, which makes most applicants wait two years after a foreclosure or short sale. Goldman said those who do not qualify but still want to own can often find a five-year, adjustable-rate mortgage, and then ultimately refinance once they are eligible for more mainstream financing.

Gabe Del Rio, president of the nonprofit Community Housing Works, said a year or two ago it was rare for someone to try to buy again after going through a foreclosure, short sale, or signing over the deed in lieu of a foreclosure. Today, it’s become a fairly standard case. In all, Del Rio said most boomerang buyers are those who went through short sales, and were not foreclosed.

“Those folks actually placed more value on homeownership when they did own a home,” he said. “You can tell by their behavior, and their behavior was going through all the steps you had to do to get permission from your lender to sell your home for less.”

Sanfillipo, who served in the Air Force, got his new loan from the VA. He didn’t lose his job in the recession, but he said that after he and his wife split, they couldn’t afford two house payments, plus day care for their two children. They couldn’t sell their three-story Santee townhome because they were underwater by $50,000, even though they bought the property with a $60,000 down payment. Ultimately, the home sold for $297,000, a 39 percent drop from the 2008 purchase price of $413,000.

Homeowner Chad Sanfilippo at the home he purchased in 2013. He lost a previous home to a Short Sale in 2009. — Howard Lipin

After the short sale, Sanfillipo rented for two years as he waited for his VA timeout period to end. He wrote a letter to the administration explaining his hardship and why they should lend to him again, but otherwise, he said, it wasn’t hard to get another mortgage. He said that waiting period, during which he couldn’t get credit, irked him.

“It feels a little bit, for lack of a better term, degrading,” he said. “I can’t buy a house, and I’m just giving (my house payment) to somebody and just renting and renting. I like to have ownership and do things to my house and improve it.”

While Sanfillipo is thrilled to own again, others who lost their homes in the recession want nothing to do with ownership ever again.

Kevin Bacon, 53, lost much of his real-estate business in 2007, the year the Great Recession began. He and his wife got behind on their payments for their La Mesa townhouse, and despite efforts to work with their lender, decided to stop paying altogether. Bacon, a realtor, took a job in retail, paid off other debts, and after two years their property was finally foreclosed. Bacon and his wife Robin owed $360,000 on the townhouse, which sold for $240,000

Today, they rent a single-family home in Fletcher Hills. Bacon says he will rent for the rest of his life — by choice. The money he keeps from the reduced expenses and lack of down payment goes to savings and travel.

“Blindly thinking owning is better than renting; it’s not. It has to be looked at in 30-year terms. I’m (53) with nobody to leave anything to,” Kevin Bacon said. “I consider us much better off than we were, and even if we bought a couple years ago, the appreciation rates still aren’t that high.”

For others, the transition delivered an easier lifestyle. Henry Orozco, a U.S. Customers and Border Protection agent, used to commute 80 miles from Temecula to his job at the border. Orozco, who is married with four children, was said their newly built home lost about $200,000 of its value, so he and his wife stopped making payments and they arranged for a short sale.

The Orozcos rented for a while and finally purchased a $475,000 home in Spring Valley. During the process, Orozco said he never lost his desire to own a home.

“That’s the American dream, right?” he said. “My intention the whole time was to get that short sale behind me and get into another house. It just makes more sense for me, because renting is basically just pretty much throwing your money away.”

Goldman, the loan officer, said he’s not concerned about people who lost their homes during the recession owning again. This time is different, he said, because lenders are actually doing their homework before approving a mortgage.

“People are verifying income, values are more stable, employment has improved,” he said. “All the elements on that perfect storm of destruction are kind of resolved.”

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