Chris Grus

The extension of the First Time Home Buyer tax credit was just approved by the house after receiving unanimous approval by the Senate yesterday.

The bill as it was passed extends the time frame on the First Time Buyer Tax Credit to all home buyer's who are under contract by April 30, 2010. The deal must be complete by June 30, 2010. What I really like is that home buyer's that have previously bought, but have been in thier homes for 5 consecutive years may also get a credit up to $6500. That resolves an issue I had with the first bill, that it was biased.

One seller asked me, "what will the effect be on sales for the next 60 days if this passes?" The answer to that is unknown. What we do know is that it will extend the favorable buying climate through mid-spring which will be nice for everyone.

I learned the basic process of how a bill becomes law from the Saturday morning cartoons back in the 70's. This mornings news that a tentative agreement had taken place regarding the tax credit for home buying being extended and widened was comforting, but as I've been telling people for months, its just a bill. They have ways of going "incognito" that weren't ever discussed on the cartoons. Getting stuck in committees, fillibuster, and on and on.

My sincere hope is that the housing market has gotten enough of a shot in the arm from the low interest rates and prior tax credits so we don't need more artificial market stimulus to "entice" people into buying homes.

I purchased my first home not too long ago, but interest rates were 7.25% and there wasn't an incentive. I ended up making a decent amount of money on that house. If buyer's are conditioned into thinking that the only reason to buy is the federal stimulus, I'm wondering what will happen when it all goes away.

Assuming the 'power's that be' deem this federal incentive to continue, it will be nice to have a continued push into home buying. One thing that I can say about getting more people to buy homes is that it appears to put more money into the economy than giving other types of incentives. When someone buys a home, what else do they buy? A mortgage, insurance, 10,000 trips to their local hardware & home supply store or garden shop. Does the same money go out when "Cash for Clunker's" took place? Maybe some fuzzy dice and a license plate holder (in my neighborhood, a few thousand on rims and some subwoolfers too).

Expanding the credit to non-first time buyer's is nice too. Giving families an incentive to upgrade seems as worthwhile as giving first time home buyer's the incentive.

More information to come at www.4SaleStLouis.com.

Back in my younger days, I was an avid hiker. One place that seemed to get a nearly annual visit was the Grand Canyon. Hiking the Canyon was the coolest thing for me, but one of the focal points was being able to dine at Phantom Ranch at the bottom.

Interestingly, most of the time, I didn't get to do it. Out of 4 hikes, I usually didn't have the time or money. One time it was in my plans, but I would have had to wait an hour for lunch, and I had another leg of hiking to do before nightfall. There just was a mystique about a restaurant that was entirely supported by mule trains.

There have been talks about getting local control of the archgrounds so that we can make more of the space. On one visit with my (at the time) two boys, I saw crumbling improvements and a space that didn't seem to favor the current National Park Service management of the place.

Today, the Post Dispatch reported that there may be some changes on the horizon. The local control idea was dropped in favor of beaurocracy of the NPS. Sounds good. I think of the initial Arch Grounds being cleared in the 30's, the competition for the design in '47 and the arch completion in '66. A real plug for beaurocracy, huh?

The good news is that they are open to making the changes and taking a national landmark and really making it an experience.

As a child, we took field trips to places like the Arch, the Zoo, etc. I remember as a child thinking that the Arch and its associated museum were sort of lame. Some would argue that speaks more to my sense of entitlement than to the Arch. I wouldn't argue, but watching the downtown renaissance unfold over the past decade, I'm more inclined to think that we can do better with the Arch Grounds too.

My thought from here is to shout out to the public to PARTICIPATE!! Especially the creative types: architects, artists, visionaries, entrepeneurs. It seems that society often relies on the decisions of the "ruling class". One perk of the NPS is that they level the playing field and truly look for the best plans. That doesn't mean that St Louisan's should sit back and play the waiting game. Check for the news release once it's posted on the National Park Service news site and give some input. The community will benefit more from participation now rather than sitting back and criticizing later.

As far as I'm concerned, Downtown St. Louis doesn't need St. Louis Center. There was a day when an anouncement regarding a major development downtown would generate a buzz downtown and people would be talking. Now, either anouncements have become white noise, or we just don't care. There have been so many big plans unveiled, so many ribbon cuttings, and so many projects that have given us what we want in regards to an urban environment. Indeed, based upon combined effects, this bit of news about the former St. Louis Center site sort of rubbed me the wrong way. The good news though, is that this is not really an anouncement or a ribbon cutting or even about tax credits. This is about money (approximately 17% of the total costs) which has been the sticking point on all projects lately. The Business Journal had its post on the matter as well. Both describe the opposition to the plan being mainly initiated by bribes from the building prospectively vacated by the moving law firm. Of particular interest is how would the former St. Louis Center be re-developed. Prior plans called for condos and retail. It seems that both retail and condos would not be as easily financed and developed as they were in the past. The location would be phenomenal though and having residences spread further into downtown would add a nice element to the area.

My buyer and I just got off the "pass the buck" meri-go-round with his prospective lender, USAA. Unfortunately, his closing date was Wednesday and after multiple extensions of his financing contingency, the bank came back the day after the initial closing and said "SORRY, NO GO!" So all the time we wasted trying to get a loan with USAA was just a waste of time.

In traditional financing, a loan officer is the person that essentially works or at least oversees your process of getting a loan. They are with you from start to finish and they TAKE RESPONSIBILITY for your process. In more recent years, with call centers and internet, a new business model seems to have evolved that I will outline below. If everything works out, it is a decent system, but it lacks the overall oversight and seems to place people that don't have adequate training or experience handling loans.

From my observation over the past few years, here is the "NEW MODEL" for large scale lending operations.

1. Fast Talker--this is the replacement for the traditional loan officer. They discuss rates and services and then are never again included in the discussion. They make it very clear after a buyer makes the commitment that the person they are working with is the #2 person on the list.

2. The Processor. This is the person that splits the duty with the fast talker. In traditional lending, the processor has always been involved, and is a big part of the lending team, but in the new model, they are responsible for the whole process with little or no oversight. At our experience at USAA, the processor didn't read the contract to determine any timelines and never had a sense of urgency about anything.

3. The Hand Holder. The compassionate one; this role only gets involved if there is a problem and the buyer or agent asks for a supervisor. Of course, you don't talk to the manager, but you get the hand holder. The hand holder really cares but like the processor, can not change the process or do anything. They normally may do better in explaining details so you understand why you aren't getting your needs met.

4. The Manager. The manager is too busy managing to get involved with transaction. At USAA, we speculated that this is an intellectual mastermind of the system that spent the day playing video solitaire, although this was never confirmed. Messages were never returned by the Manager for days, but the hand holder was summoned. The ONLY way to communicate with the Manager we found was to fax and email an aggressively worded letter directly to the President or Vice-President.

My experience at USAA over the past two weeks was similar to dealing with Quicken Loans (aka Rock Financial) and Bank of America. The problem we experienced at all lenders was that items that should have been resolved in the very beginning were allowed to be pushed off until a few days before closing. leaving my client in the lurch when the finally figured out that they could not lend on that building.

The traditional banking model where a loan officer is utilized is where I still think all buyer's should focus. Big banks may be able to compete in the interest rate arena, but in service, both before and after the deal closes, they are embarrased by the banks that allow true professionals to work with the buyer.