Washington Mortgage Planner-straight up mortgage advice and commentary

Hello all:  Well, 2007 was a wild ride.  Who knew?  Starting with the failure of Merit Financial in Kirkland, WA. (my neck of the woods), and followed by 209 others according to www.ml-implode.com, I think we've maybe hit bottom.  There aren't too many more wholesale lenders who can bite the dust!

Now the correction can begin. A longtime acquaintance at a title company told me that he thought that a real estate recovery might start happening in the Fall. I don't think he's too far from the mark.  Although the Pacific Northwest hasn't been hit as hard as the rest of the country, things were much slower in 2007 for us as well. Even though it would be nice to think a recovery will begin at the start of 2008, that's probably too optimistic.

Obviously, the playing field has been changed.  In Washington State, it's estimated we went from a high of 18,000 loan originators to 8,000 in the New Year.  What's left are the true, dedicated professionals which bodes well for you, Mr/Mrs. consumer.  Expect better, more responsive service as we move forward.  We'll actually have to earn our money now!

If you're a potential buyer, the time couldn't be better.  If your credit is good (credit score above 680) and you have money in the bank, you'll find that there's lots to choose from at often reasonable pricing.  Plus, you can take advantage of a full year's tax writeoff on your interest, property taxes, and closing costs.  Be sure to check with your tax professional to see if investing in real estate makes sense for you.

So I expect most of 2008 to still be slow before we turn the corner.  But the opportunities are out there.  I was golfing at a tournament this Fall and one of the golfers asked me what I was up to these days.  I told him I was in the mortgage business and he commented "people are always buying and selling real estate".  So true!  Have a great day.

Paul 

Hello everyone:  I love this time of year.  It's typically slower and I can plan for what I want to do next year.  What do you want to do next year?  How did 2007 treat you?

2007 was a breakthrough year for me.  In spite of the difficult market, I persevered and am looking forward to growing my business in 2008.  My goals in 2007 were simple and included:

1) Celebrate your health

2) Celebrate your career

3) Celebrate your marriage

4) Celebrate your faith

I had production goals in 2007 and fell a little short.  I think I was a little too optimistic!  In '08, I plan to continue with my core thoughts and focus on building even stronger business relationships which should lead to more loans.

What about you?  I love Active Rain because it's a great sounding board.  I'd like to hear from you about what your plans are for '08.  I know I can learn from you-that's why I am an active participant.  Happy New Year 3 days early!

Good morning: I was having a chat with my friendly local locksmith this morning.  He came by to open up one of my file cabinets that was locked.  He asked me why would someone choose me rather than going to a bank.  Great question.  Here's what I told him.

Number one, people want to work with someone local who they can trust and develop a relationship with. I told him I called him because he was local and he sounded sincere on the phone. I also called another locksmith but they didn't appear to be local; I think my call was answered in another state. I also told the locksmith that the reason people want to work with someone they know and trust is because they want to relate their good experience to others.  I told him I would tell others about my experience with his work because he did a great job.

Two, I think it's important for you, mr./ms. customer, to do a little bit of homework.  A lot of this can be done on the web these days.  Know what you want in a loan and find someone you can trust to get you what you're looking for.  A great loan officer shouldn't be offended that you want to compare.  I often recommend that you talk to at least a couple of loan officers. This should give you a feel for how they operate their business.  Get referrals from your friends or family if they've had a good experience.

Three, realize all the hype heard on the radio or tv is just that.  Be a savvy and careful consumer.  My business isn't about the lowest rates or fees. I'm pretty upfront about that.  What people remember most is the service, not how much money they saved.  It's a bonus if you get both but most folk remember what a pleasant experience they had.

Finally, take your time.  If you encounter a fast or smooth-talking salesman, be careful. Remember, you want to do business with this person again if possible. There are some great people out there who can help you, including a large number on Active Rain. Good luck in your search.  You're welcome to email me at pmcfadden@exactfg.com or call me direct at (425) 282-0553. Have a wonderful day!

Paul

Hello everyone:  I was thinking tonight about what our customer would want in the perfect loan officer.  So here goes.

1) A perfect loan officer would educate me and make the loan process as smooth as possible.  I'm busy and don't have time to figure it out myself.  I also don't want to be surprised.  Don't tell me one thing and then do another.  What you tell me should go.  I want to trust you-this is a big decision for me.

2) An ideal loan officer will communicate with me often.  Again, I'm busy and don't have time to wonder what's going on.  That's your job!

3) A great loan officer will know how to get my loan done.  He will value the relationship I want to build with him.  After all, I'd like to work with him/her again or refer him to my friends and associates.

4) If I think I'm ready to get a loan, the loan officer can tell me if I actually am.  Don't promise what you can't deliver.  If I need to improve my credit, save more money, etc., that's up to me.  I can do this.  A good loan officer will stay by my side and not abandon me.

5)  A great loan officer won't be offended if I need to shop around.  It's a rate and fee based business. It doesn't mean that I'm going to go for the best deal.  I value service even more.

I hope this helps.  My question to you is are we doing this?  If so, my hat's off to you.  I've always felt the long term is about relationships, not just transactions.  Have a nice night!

Paul

Hello all:  Up here in the great Northwest, we had it better than the rest of the country as far as real estate declines.  The market is still active here, but slowing.  The announcement today by Washington Mutual that they were laying off 3,300 workers in their loan centers definitely hits home.  Up here, WaMu. is legendary and a formidable competitor.  I was talking to a manager I know at Wa.Mu. today and she indicated things were tough. 

I think the slowdown is catching up to us.  My friend at WaMu. indicated it was their feeling the slowdown will last for the next 18 months.  For us in the Northwest, the real estate slowdown started the first part of 2007.  I know it started earlier for most of the rest of you.  Another friend of mine pegs our turnaround as Fall '08.  That might not be far from the mark.

In the meantime, I keep hearing phrases like "it's a normal market" from experienced real estate professionals.  That means we all need to work a little harder to earn our money realizing there will be an up cycle down the road.  I've seen a lot of people not make it in our office and I'm sure there will be more.   Then there will be good times again and everyone will want to get in the business!

For those of you looking to buy, it's a a great time.  Loan rates have stayed low (recently at 2 year historic lows), there's tons to choose from, and you can borrow money if your credit is good and have strong assets. If you're sitting on the fence waiting to see what happens, don't wait too long.  The opportunity within the next 6-12 months is tremendous.  Investing in real estate will be in vogue again. 

Good luck to all of you.  It's a difficult market right now but people are always buying and selling real estate.  At least that's what a guy I golfed with recently stated!  Have a blessed night.

Paul 

Good morning:  It appears likely that President Bush will sign into law a measure that will freeze homeowners' adjustable rate mortgage payments for 5 years.  This is only if the rate was scheduled to adjust and the homeowner is current with their payments.  So is this a good thing?  Of course! The question is it too little too late?

I think so.  It appears to me that the damage has already been done.  With a record 1.8 million foreclosures this year (up from 1.3 million in 2006), the governments' measure will probably just stanch the flow. Plus, it doesn't help those who are behind on their payments.  I'm not a betting man but would hazard to guess that a large percentage of those homes foreclosed were behind on their payments as well.

It's interesting that the governments' goal of having everyone buy a home came back to bite them.  Now they're having to come up with bailout programs. My question is would the market have corrected itself without help.  It usually does and I have to admit I'm an advocate of the free market.

If you're a homeowner with an ARM that is adjusting, this is potentially good news.  Remember that you must be current on your payments.  You may want to consider a refinance as well.  Currently a 30 year fixed mortgage can be had for roughly 5.75% if your credit is good.  Have a great day!

Paul