4% fixed for 7 years on Home Refinances under $400,000!!

A friend and I were talking today. He has a small business in the beach area and was telling me he was cut on his credit line - no warning, just cut. He said he used the credit line for his business and depended on having that line of credit if he needed it. This is a common experience for all the past couple of years. Happened to an associate with terrific credit and almost 80% equity in her properties, and happened to my partner who has less equity and more expenses. It was a straight across the board move by the banks. For the small business owner, there went our cushion.

I suggested getting a refinance on his house; he had at least 65% equity. I called a great Mortgage Broker - Gilbert Ramos. The quote was exceptional! 4% on an adjustable 30 year mortgage under $410,000, fixed for 7 years. On a 30 year adjustable fixed for 5 years 3.75%! Wow!~ That's cheap $$$! HELOC's (Home Equity Line's of Credit) are at 5% or more these days; so if you need that "cushion" the refi is the way to go!

Then the issue of "fixed for 7 years" came up... "what if the market changes?" my friend asked. Many have this question when they look at these rates - and the first reaction is fear. Watching the market it a normal process for those with mulitple properties and investments. It doesn't shoot up to 8% overnight, it is normally a gradual increase. I was telling him, and I'll tell you - 30 years in this business and everyone I know who has multiple properties and makes money work for them - Fixed rate loans for 5 or 7 years all the way. If the market goes up, they call their lender and fix the rate. Normally not too difficult if you have a relationship with a lender. Often times they'll call you about products you might be interested in, or if they see rates going up quickly. Bottom line, you're never stuck with that mortgage.

As I said yesterday; it's exceptional pricing right now on properties and rates. "The best moves in any market are not made at bottom, because no one knows when bottom truly is - but the best moves are made as it's going back up. You know the bottom is behind you, and money is to be made on the way up. If you can do some real estate investing, do it now. We are in the cycle of moving up - now is the optimum time.

More tomorrow... V

"Some Days in REO.... "

Agents think this business - REO - is all they ever want. If they could just get their hands on one REO account they'd be happy.... It's much like a woman seeking a husband... "if I only had a man, I'd be happy", she says. But truly, she won't be. Agents who pursue REO willl do all kinds of crazy things to get the business, especially if they are new. They don't yet know the truth - that "some days in REO" - it's just plain DIFFICULT . Hard. Frustrating. Unresolving... and a million other words!

Don't get me wrong. I love what I do, and I'm good at it - but there are days when every call, every property, every file is a challenge - or problem! On these days more than any, you long for something easy, something simple. A clean deal. One without someone trying to steal from another, or City issues, or tenant issues, or substandard liens, etc. .... We can all dream can't we? Is this my fantasy talking?? Absolutely!! Today is one of those days. A couple AM's and Agents out there know what today has been like. Mild, but still; one of those days it's going to take some smoozing to get everything done!

Other than my lamenting - and I am lamenting (a necessary habit in REO usually with a strong cocktail) - the LA market is ssccrreeaamminng! If you've got listings your King right now. If you've got cash, your're a Prince. Inventory is low. Prices are low. Rates are low. Is it win-win-win across the board for real estate investors and potential homeowners right now! I'm having visions of 2003 in my mind lately - 8, 10, 30 offers on a property. Each going up in price to acquire the property. No contingencies, no inspections, sign the deal and close it! But here's the caviot; and it's an old one, "you've got to be top dog"...(ie highest offer) Some things will never change.

Other counties are experiencing the same - I've been dealing in Riverside, Orange, and LA counties and anything under $500,000 that's priced AGGRESSIVELY is moving quickly. Note my words.... AS LONG AS IT'S PRICED AGGRESSIVELY - that is the key - AGGRESSIVE PRICING. Investors/Buyers alike believe they remain king and that the market is theirs. It has turned on them, but you must show as if it has not. A small trick of the trade, but a valuable one at present. Returns in excess of 18% on some... and that's off the value, NOT the list price. :)

Enough for today... tomorrow's another day we look forward to! Thanks for stopping in.

V