Entries from Dan Melson's La Mesa Real Estate and Mortgage Website tagged with 'competition'
New Consumer Article: The 2010 Good Faith Estimate (Page Three)
Today we have the final installment in the series on the new Good Faith Estimate formThe 2010 Good Faith Estimate (Page Three). Your government that should be protecting you from the worst sort of mortgage provider lies is now actively...
New Consumer Article: The 2010 Good Faith Estimate (Page Two)
The second installment in the series The 2010 Good Faith Estimate (Page Two) is now up. Read it and weep - for consumers nationwide who were hoping the government would provide the solution to their troubles. Didn't happen. Instead, it's...
New Consumer Article: The 2010 Good Faith Estimate (Page One)
It's been a while, but the most recent Transaction From Hell (seller's tenants didn't want to move out - or even let inspectors in) is finally over and I've had a little bit of chance to recover. Today's new consumer...
New Consumer Article: Changes In The Mortgage Market And Transparency Since 2005
It's been a while because I've been both busy and depressed over dis-improvements in the market and their effects upon consumers, but yesterday I found time to write a new article Changes In The Mortgage Market And Transparency Since 2005....
New Consumer Article: Two Things Sellers Need To Understand About Buyers
The new consumer article for today is Two Things Sellers Need To Understand About Buyers, a discussion of two things both important and basic that sellers do not seem to understand about buyers, and judging by the available evidence, most...
New Consumer Article: Some Offers Are More Equal Than Others
The new consumer article for today is Some Offers Are More Equal Than Others, talking about how to evaluate two different purchase offers even though they may be for the same or similar amounts of money. This is primarily important...
New Consumer Article: The Loan Shopping Koan
The new consumer article for today is The Loan Shopping Koan, talking about the contradiction offered by dueling interests: The fact that while consumers want the best possible loan, against the opposing fact that it's very easy for loan providers...
New Consumer Article: The Sperm Donor Theory of Buyer's Agents
The new consumer article for today is The Sperm Donor Theory of Buyer's Agents. The real estate industry is built around the listing of property. Okay, it's actually built around the care and feeding of real estate brokerages, but...
New Consumer Article: Segmented Real Estate Markets And Taking Advantage of Them
The new consumer article for today is Segmented Real Estate Markets And Taking Advantage of Them. I've written about how hot the current market is in San Diego. But if you break it down into market segments and micro...
New Consumer Article: I'm Competing Against Multiple Offers. How Do I Proceed?
The new consumer article for today is I'm Competing Against Multiple Offers. How Do I Proceed?. It's an article directed at consumers, not real estate professionals, so it doesn't go over some things such as alternatives to money that are...
New Consumer Article: The Measurement Unit For Desirability Is Dollars
The new consumer article for today is The Measurement Unit For Desirability Is Dollars. It really is that simple. A good agent can make a difference, but a property that has more will cost more. It isn't rocket science, but...
New Consumer Article: Buying Real Estate Isn't Simple
The new consumer article for today is Buying Real Estate Isn't Simple. You can pretend it's simple, and hope you get outrageously lucky. Or you can prepare and do the work, and come out reliably enough better to more than...
New Consumer Article: You Want an Agency That Can Pay ENOUGH Attention to YOU
The new consumer article for today is You Want an Agency That Can Pay ENOUGH Attention to YOU. It really doesn't benefit you to list with an agency that is too busy to pay proper attention to your property, nor...
State of the La Mesa and East County Real Estate Market April 2009
We were ready for a strong turn in the market, but the strength of what we've gotten in the last six weeks is amazing. It has been, if anything, worse that a few years ago. What caused it? People...
New Consumer Article: Shopping For The Best Loan In The New Lending Environment
The new consumer article for today is Shopping For The Best Loan In The New Lending Environment. There have been changes in the lending environment in the last few months, changes that are practically designed to make loan officers with...
New Consumer Article: Stretching Your Budget Means Compromise
The new consumer article for today is Buyers: Stretching Your Budget Means Compromise. It's something too rarely covered by the press, and by real estate agents. There are tradeoffs in every choice a buyer makes, and unless they have a...
New Consumer Article: Online Real Estate Photographs
The new consumer article for today is Online Real Estate Photographs. I know why people want to see online photographs, but I don't understand why they obsess about them to the degree they do, even after they assure me that...
State of the San Diego Real Estate Market March 2009
Reminds me of this gold rush movie (one that I recommend watching if you have a chance) Okay, it's not quite like that, but correctly priced properties are flying into "Pending". It has to do with supply and demand. At...
New Consumer Article: Why It May Be Costly to Reject Paying Points
The new consumer article for today is Why It May Be Costly to Reject Paying Points. The advice "never pay points" actually started out as misleading advertising intending to keep consumers away from what in fact were better loans, but...
New Consumer Article: There Is Always A Reason For A Low Asking Price
The new consumer article for today is There Is Always A Reason For A Low Asking Price. Sellers are not looking for people to sell their property to below market price. Usually, low asking prices should be even lower than...
New Consumer Article:"Quantity Has A Quality All Its Own"
The new consumer article for today is "Quantity Has A Quality All Its Own": Low Price. When people can get a good for less than previously, then not surprisingly they will buy more of it in the aggregate. It all...
New Consumer Article: Why You Don't Want A "Top Producer" Listing Your Property
The new consumer article for today is Why You Don't Want A "Top Producer" Listing Your Property. The agent makes money hand over fist, but they haven't got the attention to spare for getting the best price on your property,...
New Consumer Article: Multiple Offers: Weak But Increasingly Common, And It's Your Listing Agent's Fault
The new consumer article for today is Multiple Offers: Weak But Increasingly Common, And It's Your Listing Agent's Fault, talks about multiple offer situations, what they mean to buyers, and what they mean to sellers....
New Consumer Article: Stop Short Sale Bait and Switch
The new consumer article for the day is Stop Short Sale Bait and Switch. I am sick and tired of the fraudulent way that lazy incompetent agents have taken to marketing short sale properties - and it's going to start...
New Consumer Article: New Good Faith Estimate and HUD 1 Form Approved
The new consumer article for the day is New Good Faith Estimate and HUD 1 Form Approved. The government has come up with new regulations on the Good Faith Estimate (Mortgage Loan Disclosure Statement in California) and HUD 1 Form....
New Consumer Article: Advertising a Sold Property As Available on MLS
Today's new consumer article is Advertising a Sold Property As Available on MLS, talking about the basics of what forms that these loans take, the Home Equity Loan and Home Equity Line of Credit. Had some kind of stomach flu...
New Consumer Article: The Return of Portfolio Lending
Today's new consumer article is The Return of Portfolio Lending, on the subject of what a portfolio loan is and the differences between portfolio and security based lending, and what the return of portfolio lending means, even to those who...
New Consumer Article September 17, 2008
Today's new consumer article is Listings Not Sourced on MLS, in which I discuss the limits that a system checked for facts imposes upon those claiming to have a property for sale, and why it is good to have those...
New Consumer Article September 8, 2008
Today's new consumer article is Negotiation Requires More Than Dueling Ultimatums, which discusses and suggests improvements to the common model of faxing over bare offers and counter-offers. I don't understand why anyone who wants a transaction to succeed would do...
New Consumer Article September 3, 2008
Today's new consumer article is What Do Loan Qualification Standards Accomplish?, which talks about the good that having and adhering to standards of qualification does, and the problems it avoids for all concerned....
New Consumer Article August 21, 2008
Today's new consumer article is The Moment of Truth, Signing Bad Loan Documents and the Right of Rescission, which discusses the Moment of Truth that happens in every loan - when the loan documents are presented. Ideally, there should be...
New Consumer Article August 13, 2008
Today's new consumer article is Why Lenders Don't and Won't Tell Borrowers Their Loan Was Turned Down, which discusses why most lenders don't make this very simple disclosure. Basically, it's because they lose money by being honest....
New Consumer Article: August 6th, 2008
Today's new consumer article is How Do I Know If I've Been Lowballed on a Mortgage Quote?, which talks about how to nail down lenders on their quotes so that they actually deliver what you expect at loan sign up....
Is San Diego Market Underpriced or Overpriced? - A Thought Experiment for August 2008
Let's do a thought experiment. Any market in any commodity has two components: The demand, or willingness and ability to pay for that good, and the supply of that good. Let's consider the demand half of that first. Specifically, ability...
New Consumer Article July 23, 3008
Today's new consumer article is Procuring Cause and Multiple Agents, which talks about multiple agents and which one gets the commission....
Demands Listing Agents Make That Aren't in Their Clients Best Interest
One of the things I see all the time is notations made on the listing that demotivate buyers agents, or give them a reason not to show the property. This practice has had a drastic fall off of late, with...
What Remodeling is Likely to Show a Profit on Sale?
My general rule of thumb is "Remodel for your own enjoyment. If you're lucky, you'll get some of your money back when your sell." The remodeling industry has made a very large amount of money seducing people into believing...
Top Ten Reasons You Bought The Wrong House
About a month ago, I wrote Top Ten Reasons Your Home Isn't Selling. It was well received so I thought I'd take it from the buyer's perspective. Once again, I'll try to inject as much humor as I can....
Agents "Buying" Listings: Promising the Undeliverable and Hurting Their Clients
Quite a lot of the time when I view a property, I get requests for feedback. Usually it's an automated email. Other times, it's some office assistant who wants to fax me a form which will "only take a...
Don't Let Cash Make You Stupid About Real Estate
There are many ways of suckering real estate consumers, and cash as an inducement to get people to swallow a raw deal is one of the most common. From sellers (usually developers), "free" upgrades are one of the most common....
Why You Want The Lender to Assume Pricing Risk
In the last couple of years a movement has arisen, led by certain well meaning academics, that says negotiating a loan broker's total revenue is sufficient to get consumers a better loan. As far as they go, they are...
The History of Suburban Housing
For at least the last thirty years, I've been hearing "affordable housing" advocates yammer about the high cost of housing, and how working families can no longer afford "decent" housing, which they apparently consider to be the three or...
Mortgage Lenders Don't Want to Compete on Price
Yet that is exactly what you want them to do. To avoid competing on price, they have all kinds of distractions they offer to make life more convenient, but not cheaper. They offer automatic payment options, the convenience of having...
Why Cost Is As Important As Rate For Mortgage Loans
A few days ago I wrote an article explaining why borrowers should consider a 5/1 ARM, because the tradeoff between rate and cost is lower for that loan, and most people don't keep their loans 5 years anyway, so...
Zillow Post for First Time Buyers
Drew over at zillow asked me to do a short little Q & A piece for them. It went up a few days ago, and I thought I'd post my original piece here as well. What are some online resources...
What is Reasonable Loan Officer Compensation?
I get people asking me about how much their mortgage loan providers make, usually with an idea towards negotiating it down but often with the idea of choosing one loan or the other based upon the loan officer's compensation. This...
Online Mortgage Quotes
I got a question about what I think about those online quote services. The answer is that they vary from okay to putrid. There are two sorts of online quote sources. The first is where mortgage companies have their rates...
Top Ten Reasons Your Home Isn't Selling
No, I'm not a David Letterman watcher, for reasons having to do with turning into a pumpkin before his show starts. I'm going to treat it a little more seriously than he does, as this is a serious subject,...
Shop Loans By The Total Cost To You, Not By What the Provider Makes
When it comes to mortgage loans, people get distracted by the darnedest things. Let's look at Wal-Mart. You think they got to be the largest retailer in the world by making less money than their competition? I assure you...
A Good Listing Agent's Most Important Responsibility
The general public may not understand this, but the most critical parts of a listing agent's job all take place before the property hits the market. The most important responsibility of an agent who wants to successfully list property is...
Getting a Loan Provider to Agree to be a Backup Loan
I have repeatedly advised my readers to sign up for a back-up loan if they can find somebody willing. So every once in a while, I get email like this: Hi! Would you be willing to do my backup loan?...
Buyers, Asking Price and Days on Market
This article is for sellers who want to put their property on the market priced too high "just to see if we can get it." I know where sellers get it. A lot of people are out there hyping...
Writing Real Estate Purchase Offers to Beat Higher Competing Offers
I just last week closed a transaction where my clients did not make the high bid (or even close), but did get the fully negotiated purchase contract and the property. By building an airtight case that this client was...
Sixty Second Public Service Announcement About Selling Real Estate
Here was an idea I had: Pack a list of the most important things consumers need to know about buying real estate, as packed into the words I can say in sixty seconds without sounding like an over-clocked squirrel. Here...
Real Estate: Giving Someone a Monopoly Does Not Encourage Top Performance
From an e-mail I've been talking to agents lately and I ask them about the things I've learned about from your site. I thought I would say things like "I want to apply for a backup loan" and they would...
Pretending the Service Equation is Simpler Than It Is
Way back when I was just out of high school, I was doing a lot of things with my time. Working, dating, competing on the fencing team, gaming of various sorts. But every once in a while, I dropped...
My Thirty Second Public Service Announcement On Mortgage Loans
I usually write long articles, Part of that is because I've done all of the easy subjects, part because sound bites facilitate sloganeering, not serious thought that's likely to result in a better answer - or the realization that you've...
Multiple Mortgage Inquiries Do Not Drop Your Credit Score
>broker incurred 19 inquires in 1 week dropping my score. B.S. I'd go the full Penn and Teller on this one if I wasn't trying to stay family friendly. The law is clear on this one, and practice is fully...
CBB: The Art of Setting Buyer's Agency Compensation on a Listing
First off, let me make something very plain. All a CBB can do is give good agent an incentive or disincentive to look at the property. A high one will not, by itself, sell the property. A low one...
Non-Exclusive Buyer's Agency Contract - A Bet Consumers Can't Lose
There are two sorts of buyer's agency contracts, exclusive and non-exclusive. Note that this has nothing to do with Exclusive Buyer's Agents, who do not accept property for listing. I disagree with their reasoning on the virtues of doing...
San Diego Housing Market March 2008: Heating Back Up
I know I've been predicting this for eighteen months, first from a trendline and later from watching the local market in action. I was hoping to see the recovery start last summer but that was when the national media...
Finding Bargain Real Estate: Work With the Buyer's Agent Who Actually Finds The Bargain!
Several times a month I get calls and emails. Sometimes, it's even people stopping in. "I've heard you're good at finding bargains." Well, yes I am. "Please tell me the addresses of some bargains so I can drive by."...
Real Estate and the Four Levels of Competence
People who talk about learning skills tend to discuss a model for learning called the conscious competence learning model. It starts with unconscious incompetence. You not only don't know how to do something, you don't realize that it is...
The Mortgage Loan Market Controls the Real Estate Market
One of the things I keep telling folks about the real estate market, whatever area you live in, is that it is controlled by the loan market. If you want to understand where real estate in general is headed, look...
Down Payment Assistance: Buying FHA With No Money Down Doesn't Require 100% Financing!
Somebody who's only looked at the specifications for the FHA purchase program will ask me if I'm on drugs. The answer is yes, I have taken my allergy medication today, but there really are ways to purchase a property...
Relying Upon Reputation: There Are No Silver Bullets
On a regular basis, I get emails that ask me what I think of a particular company. When I check out public forums, I see questions about particular companies every time. "What do you think of X Realty, or Y...
"I'll Pay For Your Appraisal" From a Loan Provider
This is one of those commercial gambits I keep seeing that has nothing intrinsically wrong with it, and yet it is most often a tactic employed by the more costly loan providers. In short, sharks and scam artists. The basic...
"We'll Beat Any Quote" in Mortgage Loans
Just like "we'll beat any deal!" in any other competitive sales endeavor, this is a game. Actually, it's even more of a game for loans than it is anywhere else, used cars included. What they are hoping is that you'll...
I'm Sorry, Did You Think Your Good Faith Estimate (Or Mortgage Loan Disclosure Statement) Meant Anything?
Somebody asked, "What are my legal options when there's a change on a good faith estimate." Short answer: Sign the documents or don't. Same thing with a Mortgage Loan Disclosure Statement here in California. Neither one means anything binding; that's...
How to Sell Your Home Quickly and For The Best Possible Price
There's really nothing mysterious about this. There are some subsidiary tricks and issues, but the most important thing is obvious. The economic games theory is crystal clear, as is the research into what really happens. But most people don't like...
Real Estate Agents and Mortgage Loan Officers Don't Want to Compete
It's the same reason the phone company doesn't want to compete, General Motors doesn't want to compete, Wal-Mart doesn't want to compete, Disney doesn't want to compete, and Microsoft will do everything in its power to appear as if it...
Loan Quote Guarantees
Because most loan providers will not guarantee their Federal Good Faith Estimates or California MLDS forms, I've been telling folks that the best suggestion (other than doing their loans myself, of course!) that I can give them is apply for...
The Future of Real Estate Agency: Expert Consultants, Not Market Access
Expertise and attitude, not control of an informational chokepoint, is the way that things are going. Let's analyze this from both sides of the problem. The current owner looking to sell really needs a marketer. For better or worse, most...
Some Free Loan Advice About Real Estate Transactions
Most days I get loan wholesalers coming into my office. I'm always happy to talk with them, providing they want to talk about what I want to talk about. They usually want to talk about this gimmick and that gimmick...
Greed Envy, or the Tale of Aesop's Dog
At a very young age, my parents bought me a book of Aesop's Tales. Aesop has gone out of style, probably because these are stories with a moral lesson, and it seems the modern society is actively averse to moral...
Let Me Tell You About The Loan You Could Have Had
Not interested? Most people aren't when it's talking about how they got taken advantage of in the past. First off, it's in the past so it is over and done with, and there's no use dwelling on it, right? Second,...
Yield Spread is a Beneficial Tool That Can Be Misused
If you read the papers and the congressional record on the current housing crisis, you might think yield spread is the central culprit for the entire meltdown. You would be wrong. Yield spread is a beneficial tool, offered voluntarily by...
Nightmare Mortgages and Self-Destructive Behavior
Just got another one of those desperate consumer fishing calls. First off, she said she had to have an Option ARM. I told her I had them available to me, but... She interrupted me to say she had to have...
The Doctrine of Delaying The Moment Of Truth
One of the worst things about the loan process, and indeed, found throughout the whole real estate industry, is the idea that if you can just delay telling the client about something they won't like, it's more likely they'll continue...
Inducements to Use A Particular Lender for a Purchase
One of the things I'm seeing more of in MLS listings and developer advertising, among other places, is the phrase "$X in closing cost credit (or "$X in free builder upgrades" given for using preferred lender" Sounds like a bargain,...
The Consequences of Not Shopping Multiple Lenders
Minorities get higher rates. They add that the fact minorities are more likely to borrow from institutions specializing in high-priced loans could mean they are being steered to such lenders or that some lenders are unwilling or unable to serve...
Trying to Rehabilitate the Negative Amortization Loan - NOT!
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...
Will Agents List My Property if I Owe More Than It's Worth?
The answer is yes. As with everything else pertaining to real estate, there are potential upsides and downsides. First of all, lenders in short sale situations often demand agents reduce their commission, so the agents are not likely to start...
"Banks Give Better Deals Than Brokers"
Better deals for the bank, that is. Ken Harney has a recent article Study Shows Loan Brokers' Better Side But now a new, independent academic study has concluded the opposite: According to a team of researchers headed by Georgetown University's...
There's Nothing Sacred About Range Pricing in Real Estate
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...
Games Lenders Play, Part II
Here's another advertisement that I've gotten in the mail: "Pick a Pay, Any Pay!' The Revolutionary Option ARM!" "Start rates as low as 1%!" Loan amount $100,000 Payment $321.64 $200,000 $643.28 $300,000 $964.92 $400,000 $1286.56 Could this help save you...
"All Mortgage Money Comes From The Same Place"
This sentence is a textbook illustration of the most effective way to lie. Tell the truth, but not all of it. Not that I'm trying to coach habitual liars, but I am going to deconstruct this astoundingly dishonest claim that...
Debt Consolidation Refinance - Pros and Cons
There's a lot that gets written on this subject, mostly by loan officers looking for business. Well, don't think I'm not looking for business, but not with this post. Or if anybody calls me because of this, at least I'll...
Debunking the Idea of "Lenders Are All The Same"
Just like Mohandas Gandhi and Genghis Khan and Attila the Hun were all human beings, lenders are all companies that make money by lending money to people who want it. That's about the limit of the truth in that statement....
Competing Offers From The Same Agent
I wouldn't have believed this one if I hadn't been there when it happened. Another agent has a listing where the property went into default. We just happened to find out about it; the seller tried to keep it a...
Biweekly Mortgage Spam
Sometimes spam makes writing an article all too easy. Here is a piece of spam I got today because my email at work contains "realestate.com", with identifying information taken out. This goes to show that the financial ignorance of most...
Whatever the New Trick in Loans is, It's an Attempt to Keep From Competing Based Upon Price
It seems every week I get asked about some new or revived trick that loan providers are pulling. The one thing they all have in common is that they are methods to avoid competing on price. What the basic terms...
Just Because Compensation for a Loan Isn't Disclosed Doesn't Mean It's Free
I am continually confirming that a large percentage of people can't handle negotiations like an adult. They focus in on garbage and ignore what's really important. I recently was going to deliver a loan that cost less, as well as...
Real Estate Loan Pre-Qualification
One of the most useless and overworked items in the real estate industry today is the pre-qualification for a loan. Sellers want buyers to be "pre-qualified", and buyers are seeking "pre-qualification" to convince buyers they are serious. The level of...
Lowballing versus "Junk Fees"
One of the things that most mortgage and real estate consumers get mixed up on is the distinction between low-balling and junk fees. Junk fees are when they add fees that really aren't necessary to what you're paying. Low-balling is...
Dual Agency and Sellers Wanting to Keep a Buyer's Deposit
What can a seller do to get the deposit when the buyer backed out after the time limit and just won't sign off on the money? My real estate agent is not helping at all. The real estate office...
Mortgage Loan Rate Locks
One of the most true sayings in the mortgage business is, "If you can't lock it right now, it's not real." But many mortgage providers will play a game of wait and hope. They tell you they have a certain...
The Best Way To Create Problems In Real Estate
Have a "looking for cheap" attitude, especially on services meant to protect you. It's great to have a "looking for value" attitude. If I cost more than someone else, it is in your best interest to ask why, and ask...
Deciding You Don't Want A Particular Mortgage Loan
I have questions to ask you about the loan for house. I have been work with one broker since DELETED and I just tell her on the phone that I chose her and that she can start to do...
Reading Property Advertisements: Many Grains of Salt
The first thing you need to understand in reading any property advertisements is that agents write them to get people to call. They are trolling for clients. Except in the case of someone who doesn't accept dual agency advertising a...
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