Posted on August 14, 2008 @ 9:14 pm - Written by BawldGuy
Until the last couple years, our clients, for the most part, have been able to acquire their investment real estate without paying loan points. As change in the markets took hold, things began to change. How’s that for understatement? The lender problems emerged big time. Underwriting changed even more, and lenders changed the way they viewed investor loans. To all this you may all now roll yer eyes while in unison saying, Duh. I know, I know. When yer used to no points and read closing statements these days, it can be chilling.
How ’bout goin’ from loan fees totaling less than $2,000 for a fourplex purchase, to $5,000 sans processing for a duplex? Ouch and a half.
Yesterday we learned investor loan costs have risen — again. My response?
So what.
Real estate investing is, in so many ways almost perfectly analogous to baseball, the perfect sport. (And no, we’re not gonna waste time debating that assertion, as there’s no point in doing so.) And the first rule in baseball is the same as in real estate investing:
There’s no crying. Read the rest of this entry »
Posted on August 12, 2008 @ 12:14 am - Written by BawldGuy
Real estate investors everywhere are inundated with information leading them to the conclusion lenders simply aren’t interested in them. This has led to many throwing up their hands, waiting for ‘the recovery’. Apparently this will be when lenders will send them personal invitations to scoop their share of money then earmarked for the investors they’ve missed so much. It’s like they’re lookin’ for a sign.
This week alone Brown & Brown closing about a dozen transactions, all of them investment properties. All of them part of multiple purchases by investors. Half of them using 90% loans. How can that be true?! They must’ve paid monster loan fees, right? Nope, same as everyone else. Well then, they surely paid higher interest. No again. Depending upon individual lock dates, they all paid 6-6.5% interest rates, on fully amortized loans.
This leads to more questions. Read the rest of this entry »
Posted on June 24, 2008 @ 12:17 am - Written by BawldGuy
You can check out Part I here and Part II here if you need to catch up. Now we can proceed with what you might expect while in escrow. For those thinking, ‘Hey, we have a contract, what could happen?’ I keep a plentiful supply of generic aspirin available.
It’s far easier to list what can go right in an escrow than what can potentially go wrong. As an understatement, that may rate honorable mention on the annual Top 10 List.
5. Incomplete list of what can go sideways while in escrow.
Numero uno on this list is lender related. Name something in the loan process and I’ll give you a real life experience (we call this empirical evidence) of how it can, has before, and will again torpedo an escrow. Let’s count just a few of the myriad possibilities. Read the rest of this entry »
Posted on May 24, 2008 @ 8:24 pm - Written by BawldGuy
This past week, and throughout all of the coming week or two Brown and Brown clients have been and will be closing escrows. Every single client is acquiring multiple properties with 10-20% down payments — with a fixed rate of 6%.
Wait just a doggone minute here! Real estate investors can’t do that any more, can they? Ah, yeah, they can. I keep tellin’ you. Stop drinkin’ MSM’s (mainstream media) Kool-Aid. While from every corner we’re being told what we can’t do, we’ve been doin’ it.
I’ve had clients tell me right up ’till they get confirmation of closing, that the loan won’t materialize. “Hadn’t I been following the news lately?” Read the rest of this entry »
Posted on April 26, 2008 @ 12:03 am - Written by BawldGuy
It’s never a good day when I find it necessary to tell someone I can’t take them on as a client. Sometimes it’s ‘cuz they find themselves in quicksand and need help — but they’re too far gone. Most of the time though, it’s ‘cuz they’re under capitalized. They either want me to help them invest with 0-5% down, which I won’t do period, end of sentence, or they’ll have zip, zero, nada cash reserves to establish their Sominex Account.
As I’ve said dozens of times here, no Sominex Account means we can’t work with you. Though it’s designed to help the client sleep when Murphy makes his inevitable visit(s), it’s also there so I can sleep, know what I mean, Verne? I don’t like those weird dreams when I’m stressed.
Still, to those for whom I can’t help for this reason, and who obviously have more courage than is safe, I offer the following. Read the rest of this entry »