Investing in “Cheap” Real Estate: A $10 Million Pig Is Still a Pig

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Buying cheap property is usually a bad idea. I call it buying a “pig.” And pigs don’t always cost $30,000. In fact, my partner and I just walked away from one that cost millions. Here’s the story.

View the full article: Investing in “Cheap” Real Estate: A $10 Million Pig Is Still a Pig on The BiggerPockets Blog. This content is Copyright © 2017 BiggerPockets, Inc. All Rights Reserved.

Why Do Some Real Estate Investors Fail?

Mans Hand Reaching For Red Ladder Leading To A Blue Sky

Can you imagine buying a franchise or starting a business and not being fully committed? It wouldn’t make sense. Real estate is no different. But the fact is some people just won’t commit to doing whatever it takes to reach their goals. Here’s why that will ruin your chances of success every time.

View the full article: Why Do Some Real Estate Investors Fail? on The BiggerPockets Blog. This content is Copyright © 2017 BiggerPockets, Inc. All Rights Reserved.

NAR slapped with second class-action lawsuit to end buyer broker compensation

A second class-action lawsuit has been filed in protest of the buyer broker compensation rules set forth by the National Association of Realtors. The suit alleges that NAR and MLS providers violated federal antitrust laws by requiring property sellers to pay the buyer’s broker an inflated fee, a claim NAR called “completely without merit” as it vowed to defend its policies in court.

Landscaping: 4 Tips to Instantly Improve Your Yard’s Curb Appeal

landscaping-tips

Landscaping can easily pay for itself in increased home value. Even if you have a black thumb, these four tried-and-true, easy landscaping ideas will help you achieve a beautiful yard and dramatically alter your home’s appearance!

View the full article: Landscaping: 4 Tips to Instantly Improve Your Yard’s Curb Appeal on The BiggerPockets Blog. This content is Copyright © 2017 BiggerPockets, Inc. All Rights Reserved.

The Silent Generation: Downsizing Homes & Joining Senior-Related Housing

The Silent Generation, buyers aged 73 to 93 years, made up the smallest share of buyers by age at only seven percent of all home buyers in 2018. The median age for this group was 76 years old and they were born between 1925 and 1945. They tended to have the smallest families; 96 percent of these buyers had no children living at home under the age of 18 years and they made up the same share of single female buyers as Younger Boomers at 25 percent. Of the generations, buyers 73 to 93 years bought fewer multi-generational home at 13 percent. For those that purchased a multi-generational home, the reason was for the health and caretaking of aging relatives at 13 percent.

The Silent Generation had the smallest share of first-time home buyers at only four percent, which was expected for their age group. Correspondingly, they made up the largest share to move directly from a home that they owned at 82 percent. They also had the lowest median household income at $69,600, likely living off retirement funds. They managed their finances accordingly and bought homes with the second lowest median home price at $243,000. They also purchased some of the newest homes last year with a median year of 1996.

Buyers aged 73 to 93 years also bought new homes at 14 percent and wanted the amenities of new home construction communities (23 percent). These buyers were the most likely to purchase a duplex, apartment, or condominium at nine percent, or a townhouse at 10 percent. They were also the most likely to buy a home in senior-related housing at 29 percent. These buyers wanted a home convenient to friends and family (47 percent) and for the convenience to shopping (34 percent). They were the least likely to buy homes in an area for the quality of the school district, convenience to schools, or for the convenience to a job. They were also the least likely to compromise on the condition of the home (16 percent). The Silent Generation also bought frequently in a rural area at 23 percent.

The age group of buyers 73 to 93 years were the highest share among the generations to purchase for the desire to be closer to friends and family (27 percent) and for a smaller home (17 percent). They had an expected tenure in the home at a median of 10 years. They were the most likely to move due to a household member’s health and least likely to want a larger home.

Apr. 18: AE & LO jobs; u/w product, paper on FHA changes; tech report; compliance & Ops news

Experienced originators know that lending is a numbers game. Every 100 cold calls result in 20 conversations, which result in 5 potential leads, which result in 1 closed loan. Or whatever personal ratios are. Not only that, but there is a 2-4-month lag time between those 100 calls and any funded loans that come from making them so good LOs have been laying the groundwork for summer for a quite some time. But speaking of two months, from St. Louis Mike Swaleh reminded me that the revised Uniform Closing Dataset (UCD) Seller data requirements will be effective on June 24, 2019. Lenders are working on the borrower’s app process. For example, Envoy Mortgage has developed XLR8. More on Ops issues below.

Employment & business opportunity

Arc Home welcomes Katherine Gardner as Chief Production Officer leading Arc’s Wholesale, Delegated and Non-Delegated Correspondent Channels. “Arc Home is perfectly positioned to grow in this challenging market. By providing proprietary Non-QM products in addition to a full agency offering, we can meet our customer’s product needs and meet their desire to work with a unified operation and salesforce. Having a proprietary product enables us to advance in the Non-QM space others struggle with – program exceptions. Our competition sees loans outside the guidelines as exceptions; we see them as an opportunity for execution. Non-QM is blurring traditional channel lines. We are adding Account Executives with the ability to sell across the client-spectrum. In addition to growing our salesforce, we will continue to build our operations teams in Mt. Laurel, NJ and Phoenix, AZ. If interested in joining a growing team, please contact Katherine Gardner, Chief Production Officer.”

A privately-held mortgage company licensed in 14 states is interested in partnering with an investor or another mortgage company to grow their origination platform, in addition to securitizing and servicing loans The company has been in business for over 35 years and is approved by Fannie Mae, Freddie Mac, Ginnie Mae and all major private investors.  If interested, please contact Anjelica Nixt.

“At Franklin American Mortgage Wholesale Lending, our Account Executives are the heart and soul of what we do, providing best in class industry knowledge and a hands-on approach to developing relationships as we grow with our valued business partners. A division of Citizens Bank, N.A., we provide the tools and support that our AEs need to make an impact in today’s competitive marketplace. We are looking for Account Executives in Washington, D.C.; AZ; Austin/San Antonio, TX; UT; OK; WA; OR; Los Angeles, CA; CO; and Chicago, IL to join our team and take their careers to the next level. If you’re ready to join a team that’s focused on your success and the success of our business partners, please email Jennifer Rader, VP, Head of Talent Acquisition – Home Mortgage to get started today.”

One of the strengths of Caliber Home Loans, Inc. is its product portfolio. Caliber offers a wide range of loan options to meet the needs of more borrowers: government, conventional, jumbo, and a proprietary suite of non-agency loans. Caliber also participates in state-specific DPAs and bond programs, and has the ability to broker and offer buy-downs. By offering more products for its producers, Caliber gives them the opportunity to meet the needs of more home buyers and increase volume. In 2018 Caliber added 65 retail products, an increase from 44 products introduced in 2017. Part of this product expansion has included additions to its Caliber Portfolio Lending suite (CPL). Introducing Elite Access to this suite of non-agency loans was attributed to Caliber’s 122% growth in 2018 CPL volume. If you’re looking for a lender that has the products you need to succeed in this market, contact Jeremy DeRosa or visit www.joincalibernow.com.

Lender products & services

MGIC’s SEB Cash Flow Worksheets are Now Live! These worksheets are the industry standard for excellence in analyzing self-employed borrower income.

PlainsCapital Bank National Warehouse Lending, a subsidiary of Hilltop Holdings (NYSE: HTH), understands the importance of efficiency when it comes to meeting our customers’ funding requests. “That is why we make the funding process simple: ‘Express Funding’ is how we help our customers reduce the time needed to get their loans funded. Express Funding allows our customers to submit multiple loans for funding in one simple data upload, whether it is one loan or 100 loans. Express Funding is an easy and efficient way to get the funds they need quickly. In addition, we offer a growing list of 2,000+ closing agents with No Doc funding requirements and funding turn times averaging under 30 minutes. We believe in consistently providing service to exceed our customers’ expectations. If you are interested in having a conversation about PlainsCapital Bank National Warehouse Lending, please contact Deric Barnett, EVP National Warehouse Lending.

With the market constantly fluctuating, lower your fixed costs and improve efficiency by outsourcing your QC operations. UHS America, a California based leader in QC/Compliance for nearly 20 years, has recently expanded its services to include Non-QM Underwriting Review. With over 120 years of combined mortgage expertise; their long-standing agency relationships with FNMA, FHLMC, FHA, USDA and; their state-of-the-art proprietary software QCIQ, UHS is confident they can help lenders save on origination costs while concurrently delivering the highest quality services for QC and Underwriting. For more information about UHS’s Prefund QC, Post-Close QC, Underwriting (QM and Non-QM), Due Diligence or Mortgage Consulting services, please contact Lisa Vang (657-269-4578), Kim Day, or visit www.uhsamerica.com. Connect with us through LinkedIn.”

The teams at SocialSurvey & Mortgage Coach are excited to announce an integration to help Loan Originators win even more deals! In today’s competitive environment, it is all about standing out from the crowd by providing incredible advice and establishing the highest level of trust with your borrower. Enterprise users of SocialSurvey & Mortgage Coach have the ability to display SocialSurvey reviews and testimonials inside the Mortgage Coach Total Cost Analysis (TCA). Scott Harris, CEO of SocialSurvey, stated “Our philosophy has always been reviews collected by Loan Originators should be shared in as many relevant places as possible.” Joe Puthur, President of Mortgage Coach, added, “Every TCA presentation will include client reviews, combined with tailored loan options.” Learn more about the integration by visiting SocialSurvey’s blog post.

Spring has arrived in Washington, and with it has come a great deal of activity on the housing finance front. Don’t know where to start when it comes to staying updated? We can’t blame you. There are the hearings on housing finance reform, the budgets of federal agencies, the memorandum about reforming the government-sponsored enterprises, and so much more. But, it’s this quietly announced change by the FHA that arguably poses a more immediate impact to mortgage lending. TMS’s government expert Nathan Shultz shares what this new change means for lenders in this latest blog. 

Report on MBA Tech Conference

Can the mortgage industry become like Apple or Tesla? In the April issue of STRATMOR Group’s Insight Report, Senior Partner and CEO Lisa Springer urges lenders to take cues from Tesla and Apple and adopt technologies that enhance the borrower’s experience. “The mortgage industry must transform the status quo and become forward-thinking and dynamic lenders willing to cater to a new digital era that removes the complexities of getting a mortgage,” says Springer in her article “Key Takeaways from the MBA Technology Solutions Conference.” Enhancing the borrower experience is driving technology investment, and Springer points out that in a conference session by STRATMOR Senior Partner Garth Graham, 58 percent of the attendees gave “borrower satisfaction” as their primary reason for investing in technology. Hear what STRATMOR heard at the tech conference, including how some lenders are incorporating robotics and AI into the mortgage process and alternatives to traditional loan origination systems (LOS). The April Insights Report.

Compliance, Ops, misc. underwriting changes

Lenders Compliance Group revealed that it is introducing its Website Tune-up!™ “We have pioneered unique regulatory tune-ups that are affordable, full compliance reviews, promptly completed by subject matter experts, and delivered in an actionable report. Our compliance tune-ups are a great way to quickly evaluate virtually all regulatory elements in mortgage banking, proving that compliance reviews do not have to be expensive or take forever to get done! CLICK HERE for more information about the Website Tune-up!™

The April 2019 issue of Mortgage Compliance Magazine features a wealth of information on quality control, starting with the first installment of a nine-part series from Steve Spies, VP of Loan Quality with Fannie Mae, from Fannie’s Beyond the Guide. In this issue, Spies navigates the process of meeting secondary market investors’ QC requirements and discusses the keys to effective QC. This issue features insight from a number of the industry’s top QC experts on the latest QC issues, including Phil McCall of ACES Risk Management (ARMCO), Tim McWay and Aaron Soule of CrossCheck Compliance, Laura Kate Davis of Quality Mortgage Services (QMS), Charles Sewright of Quest Advisors, and Belinda Kraus of Trelix. Click here to view the April 2019 issue of Mortgage Compliance Magazine

AmeriHome announced the publication of several new Non-Delegated Underwriting Program resources available on SellerWeb, including new “Did You Know” resources, updated Non-Delegated user guides, a new Non-Delegated Loan Submission Checklist and new ordering options for private mortgage insurance.

Mortgage Solutions Financial posted updates to its Loan Purchase Requirements.

Freedom Mortgage Wholesale offers the Texas Non-Home Equity 50(a)(4) program. View the Product Guide for details.

FNMA updated requirements regarding borrower-initiated cancellation of private mortgage insurance (PMI) this past July. Mandatory compliance with these changes begins September 1st, 2019, but servicers may optionally begin complying with these changes starting on January 1st. Read the docutech Compliance update for information on document changes to California, Connecticut, and Washington PMI Disclosures.

Waterstone Mortgage has introduced an update to its Single Loan Close Construction Program, or construction loan. The one-time-close loan program still offers one loan to cover the cost of the land, construction, and mortgage, but now also includes 95% LTV, meaning the down payment requirement is just 5%.

U.S. Bank Correspondent posted SEL-2019-014: Geographic Market Restrictions in Nevada.

AmeriHome announced that several new Non-Delegated Underwriting Program resources are now available on SellerWeb, including a new Non-Delegated Submission Checklist. A new private mortgage insurance ordering option is now available as well.

Eligibility and underwriting guidelines for the Ditech Correspondent Expanded Criteria products have been revised.

Effective March 18, 2019, the maximum LTV/CLTV’s for Second Home Purchases and Rate/Term Refinances with Mountain West Financial Wholesale have increased. Maximum LTV/CLTV has increased 5% for loan amounts/combined loan amounts up to $2,000,000.

Capital markets

From out of Michigan came news that Northpointe Bank’s new SVP of Capital Markets is Bryan Neitzelt. Bryan will be responsible for enterprise-level financial risk management of Northpointe’s nationwide residential lending business, including interest rate risk hedging, securitization, portfolio asset management and investor relations.

Few expect a big move in rates up or down in 2019, but that doesn’t stop them from drifting up or down. The yield on 10-year Treasuries was little changed at 2.59 percent after hitting its highest level in more than a month amid data showing the U.S. trade gap unexpectedly narrowed. European debt also dropped, while the euro strengthened even as Germany’s economy ministry revised its growth forecast lower. Health providers and hospital operators came under pressure as U.S. politicians debated expanding Medicare to all Americans, which could upend earnings models for large parts of the system. The rout in health-care shares dwarfed the latest batch of earnings reports, which painted a mixed picture on the state of the economy (e.g. Morgan Stanley rose, but Bank NY Mellon weighed financial shares lower). Earnings continue today and tomorrow, and investors are growing more confident the anticipated drop in Q1 results won’t ruin the year, as central banks around the world continue to be accommodative and the latest Chinese data calmed fears that the world’s second-largest economy was slowing down.

Data today began with weekly jobless claims for the week ending April 13 (-5k to 192k), Retail sales (+1.6%) and Retail sales excluding autos for March (+1.2%), and the Philly Fed Index for April (-5.2 to 8.5). Next up will be the flash Markit manufacturing PMI and flash Markit services PMI later this morning. Those readings come just before February Business inventories; and March Leading indicators at 10am ET. Finally, at noon Fed Governor Raphael Bostic speaks. Most financial markets will be closed for the Good Friday holiday tomorrow, including in the U.S., U.K., and Germany, but we will still have March Housing starts and Building permits. We begin today with agency MBS prices up slightly versus last night and the 10-year yielding 2.58%.

As we said through the week toward Good Friday & Easter, these supposedly appeared in real church bulletins (part 4 of 5):

19. Please place your donation in the envelope along with the deceased person you want remembered.

20. Attend and you will hear an excellent speaker and heave a healthy lunch.

21. The church will host an evening of fine dining, superb entertainment, and gracious hostility.

22. Potluck supper Sunday at 5:00 PM – prayer and medication to follow.

23. The ladies of the Church have cast off clothing of every kind. They may be seen in the basement on Friday afternoon.

24. This evening at 7 PM there will be a hymn sing in the park across from the Church. Bring a blanket and come prepared to sin.

25. Ladies Bible Study will be held Thursday morning at 10 AM. All ladies are invited to lunch in the Fellowship Hall after the B.S. is done.

Visit www.robchrisman.com for more information on our industry partners, access archived commentaries, or to subscribe to the Daily Mortgage News and Commentary. If you’re interested, visit my periodic blog at the STRATMOR Group web site. The current blog is, “MBS Liquidity: A Real Trooper.” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.

Rob

(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are hundreds of mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2019 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)

BiggerPockets Podcast 326: Health, (Big) Wealth, and Total Accountability With David Osborne, Pat Hiban, Tim Rhode (and Josh!)

What does true wealth mean to you? Having control over your time? Having the means to donate to charity? Maybe it means being healthy enough to jump out of bed and attack the day. Today we speak with three financially independent investors about what motivated them to work so hard toward their goals.

View the full article: BiggerPockets Podcast 326: Health, (Big) Wealth, and Total Accountability With David Osborne, Pat Hiban, Tim Rhode (and Josh!) on The BiggerPockets Blog. This content is Copyright © 2017 BiggerPockets, Inc. All Rights Reserved.

Sanctuary: An Astronomer’s Home Observatory

Jonathan Fay lives a double life. By day, he works in software engineering, but once the sun goes down, he opens a window to the heavens – right in his own backyard.

The amateur astronomer designed and built an observatory behind his Woodinville, Washington, home to house his 12-inch telescope. There, he gazes at planetary nebula and photographs galaxies. For Fay, having his own sanctuary is out of this world.

How would you describe your sanctuary?
My observatory is a place of peace where I can collect my gear and spend time with the universe. The nature of astronomy in the Pacific Northwest is challenging, but I’m able to open the dome and start observing without having to set up ahead of time and rush to cover things up when it rains.

What do you like best about the physical space?
It’s separate from the activity of my home, and it’s quiet. I don’t disturb anyone else, and they don’t disturb me.

What’s your home like? Is your sanctuary an extension or departure from your home?
Our home is a two-story wood and brick home. The observatory blends nicely with the house and barn in style, but the dome clearly sets it apart.

Did you have your sanctuary in mind when you chose your home?
No. A few years after I moved in, I realized I needed a more permanent place than a second-floor porch off the bedroom to set up my new telescope.

What was the tipping point that made you decide to create a sanctuary?
When I would do astrophotography imaging runs on the second-floor porch, people would turn on lights or walk around, and the light and vibration would ruin the image. My wife didn’t like having to shut down her life for my hobby.

How did you build your sanctuary?
I designed and built the observatory. I had some occasional help from friends when I needed lifting or a second pair of hands. I also had help from my kids handing me screws and nails while I worked.

Sanctuary_Fay_exterior_05

What was the biggest challenge in creating your sanctuary?
Round stuff is hard. Especially when it has to rotate and be level. The dome was a hemisphere, so it was round in more than two dimensions. Woodworking tools are not optimized for round things.

Has your sanctuary always looked the same, or has it changed over time?
We recently added wood floors from carpet. And we put on a new roof when we re-roofed the rest of the buildings on the property.

How much time do you typically spend in your sanctuary?
Sometimes many hours for several days in a row. Sometimes I go weeks without going inside. It depends on the ebb and flow of life – and how bad I need it.

How did you get into astronomy in the first place?
My aunt gave me a telescope when I was about 12. Since then I have loved space and astronomy, but when I could put a computer-controlled camera on a telescope, that made me want my own Hubble in my backyard.

Sanctuary_Fay_interior_01

Does your hobby influence what you do professionally or vice versa?
Building my observatory, writing all the software for it, and doing astronomical imaging helped me create the WorldWide Telescope project with two of my co-workers. Now millions of people can visit space on their computer or planetarium because of it.

Do you share your sanctuary with anyone? What about your home?
I will share the observatory with just about anyone who asks, and sometimes I invite people to join me. I share my home with my wife and five active kids. So sometimes a getaway is in order!

Sanctuary_Fay_portrait_08

 

If you had a do-over, would you change anything about your sanctuary?
While I love the look of the dome, I would make the shutters open wider to accommodate a bigger telescope.

Do you wish you had found your sanctuary sooner?
It came at the right time for me, and I returned to update it when that time was right.

What advice would you share with those who dream of having a sanctuary someday?
You’re not getting any younger. Just go for it, even if you don’t use it as much as you think you need to to justify the cost. It will always be a great story to share.

Related:

  • This Tiny Home Is Ready for Outer Space
  • From Scraps to Sanctuary: A $700 A-Frame Cabin
  • This Remarkable Home Is Anything but Square
Originally published July 2016.