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Why You Shouldn't Have All Your Money In Real Estate
Is there any problems with having all your money in only real estate? That was a question I saw. The answer is YES there are problems! 1) No diversification. The real estate market tanks and you are hosed. The...
Fear and Greed, or How Did The Housing Bubble Get So Big?
(This was originally written February 16, 2006, but it's relevant still) One of the occasional questions I get from people has to do with why the housing bubble got so big (or if you're one of those still in denial...
Should I Buy A Home? Part 3: Consequences
Continued from Part 1: Preparation and Part 2: Process This is about the long term consequences of the decision to buy or not to buy a home, and economic benefits analysis into whether you should want to buy. In order...
Which Makes More Difference To Your Future - Buyer's Agent or Listing Agent?
Having done both, there's no question in my mind. For the average person and the average transaction, the buyer's agent makes a lot more difference. In the aggregate, a good buyer's agent has the opportunity to make a lot more...
Mortgage Protection Insurance - The Worst Life Insurance Policy You Can Waste Your Money On
One of a long series of emails about this horrid product: (identifying details redacted) Learn How To Make More Money Per Client ($500-$1000) In This Workshop You Will Learn Why The Most Successful Mortgage & Real Estate Professionals Across The...
What Do You Know That I Don't Know?
Whenever I go scouting in public forums, somebody is always asking, "What's the secret? How do you get rich in real estate?" The alternate to this question is "What do you know that I don't?" These people are sure there's...
Where Would I Invest A Million Dollars?
Somebody asked me that. Well, I'd want to set some aside for liquidity and reserves, in case something happened where I needed money now. invest those funds in a diversified mutual fund and money market portfolio. Once that's done, I'd...
Bridge Loans
One of the things I'm seeing a lot of these days is blanket advice on bridge loans. A bridge loan is a loan that you take out with the explicit intention of having it be short term. The most common...
Segmented Real Estate Markets And Taking Advantage of Them
Market segmentation is what happens when certain things are much more in demand than others. For instance in the hot market brought on by the tax credit of 2009, the central area of San Diego was in high demand,...
Wanting a More Expensive Property Than You Can Really Afford
This is one of the biggest issues with my local real estate market. Because the San Diego market has very high demand and limited supply of property, prices are high. A reasonable two bedroom condo runs around $200,000. A 1200...
Full Circle: Back to More Traditional Lending Standards
When things went south in the real estate market, I saw more changes in the lending industry in a few months than the previous five years. But those changes mostly restored us to the place we were a few years...
Efforts to Rehabilitate the Negative Amortization Loan
The negative amortization loan is a very popular loan with certain kinds of real estate agents and loan officers. It has two great virtues as far as they are concerned. First, it has a low payment, and despite the fact...
Buying Real Estate Isn't Simple
And I don't know why people expect it to be. Cancel that. I do know why. Popular media. It's not all that common in popular media, but on those occasions I see someone buying a house in the movies...
When Your Offer is Rejected
"overpriced house offer rejected what next" (Before I get started, I want to make it clear that I am using the same definition of worth found in this article) The first thing to consider is the seller obviously didn't feel...
Listing Agents Claiming There Are Multiple Offers
Once upon a time, this was a good way to get more money for your listing. This led to a classic tragedy of the commons. Because it didn't take hardly any extra time, and there was no reason not to...
Down Payment At Purchase or Wait Until Later To Pay The Mortgage Down?
Got a search engine hit for do I make a big down payment on a home or should make a lump sum payment after the mortgage It's hard to construct a scenario where using it as "purchase money" doesn't come...
There's Nothing Sacred About Asking Price in Real Estate - Variable Range or Regular
A few days ago, I had an agent get angry at me about an offer below a range asking price. I had submitted the offer with extensive justification as to why it was an appropriate offer. Basically, this clown had...
Variable or Range Pricing of Real Estate
About half the listings around here do not have a single number asking price, but rather a range in which "offers will be considered". Even many agents have trouble understanding range pricing. I've seen and heard more than one agent...
Loan Qualification Standards - Loan to Value Ratio
Many folks have no idea how qualified they are as borrowers. There are two ratios that, together with credit score, tell how qualified you are for a loan. The more important of these two ratios is Debt-to-Income ratio, usually abbreviated...
Competing Offers From The Same Agent For The Same Property
I wouldn't have believed this one if I hadn't been there when it happened. Another agent in my office had a listing where the property went into default. We just happened to find out about it; the seller tried to...
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