Ray Nelson

Okay folks, I know this isn't real estate related, but my son has autism and I want people to know it is autism awareness day. I'm not asking for money, just a little of your time. First, try to be a little more tolerant of kids in public places. Many kids, even if they don't have autism, are disregulated by the astounding array of colors and sounds in grocrery and department stores. However, kids with autism see this in an entirely different way. It is literally overwhelming to them, and they can't help but to scream, squeal or otherwise stim themselves until they calm down.

There is a lot more. If you feel like reading more, then head over ty my autism blog at www.raynelsonrealtor.wordpress.com If you don't feel like it, then thanks for reading this and try to be a little more patient today. I promise you will get more than you give!

Just a quick note to my AR pals to say I've moved to Exit Real Estate Professionals here in Fredericksburg! I'll miss my pals at my old office in King George, but I'm much happier about the drive. Anyway, I have a new website at http://raynelson.exit-fredericksburg.com/ and a new blog at http://raynelsonrealestate.wordpress.com/. Check them out, and feel free to congratulate me! I'm super excited!

Seriously though, I feel like this office has the few missing ingredients in my real estate stew. It is almost perfect, but the tools that Exit provides are above and beyond the industry norm. I think its a good marriage, and may have some buyers getting ready to climb off the fence! Let's all look forward to a wonderful spring market.

Okay, I finally made my first Green Drinks last night and had a great time. For those of you who haven't heard of it, Green Drinks is a monthly cocktail hour for people in green industries. It is organized globally via their site, www.greendrinks.org and locally by eco minded folks in the community. I've been looking for a way to get involved in our local green scene, and this looks like it.

I have been trying to go to this thing for at least 6 months, but things kept coming up. However, since my pal Matt Rathbun was speaking at this one, I made the extra effort to attend. He is our local real estate board's director of education, and he was there to talk about the Green designation for REALTORs that NAR is now offering. Its a pretty fantastic designation, and I wish I could take the class next week. Unfortunately, I'm tied up so will have to try and catch it next time its offered. In a nutshell, the class is designed to familiarize REALTORs with green terminology, introduce them to green concepts and give them the tools to help them become experts in renewable building. As with everything green, there is so much information that it is impossible to learn it all in a 2 day class. However, it is a great jumping off point, and well worth the cost.

The event itself was fun. People were friendly and definitely there to network. I got an intense education from some of the builders I chatted with, and the lighting specialist that was there was especially knowledgeable. I also met an accountant who specializes and understands eco friendly concepts, an stockbroker who understands green investments, a few fellow REALTORs, and a ton of other folks. All in all, it was a great beginning to my green experience. Some of the key terms bandied about were LEEDS for homes, Earthcraft Homes and EnergyStar. Our local green drinks is coordinated by Dan Dukes, who is a rater for Earthcraft and LEEDs for homes. FYI, the rater is a key part of the green building process. The rating is what makes it green, and raters have inspect the homes to make sure they meet certain standards.

At any rate, if you're looking to get your feet wet in the environmentally friendly world, I highly recommend attending a Green Drinks. Its a relaxing, low pressure way to find out who's who in your local green world. As everyone who succeeds in real estate knows, this is a people business, and the people who go to green drinks are knowledgable and approachable. I toast your entry into green building!

I received quite the interesting email this morning. I have copied and pasted it in its entirety, including contact info for the "loan processing officer" although I do NOT recommend you contact him for a loan! I'll let you read it and see if you would want this person handling any of your financial interests. The title of the email was "Apply for loan with us."

FINANCIAL INSTITUTION FOR LOAN SERVICES

Borrowing money is a serious business and you need to be 100% sure that you have exactly the right loan to suit your requirements both now and with the future in mind. Please do not hesitate to call or e-mail our office and we will be pleased to answer all your questions and help you apply. We give out loan to people all over the globe at soft interest rate. If you are having a financial problem at the moment and you need an assistance, if you are planning to start up a business of your own, what ever financial problem it is, bolo loan company is the right company to assist you with a loan transaction, all you need to do is to write an application letter to the loan processing officer of this company with the below e-mail address. He will begin the process of your loan immediately.

Contact Name: Mr. Segun Moses

E-mail: mr.segunmoses17@hotmail.com

Phone: +2348038082439

The e-mail above is a direct e-mail which you will use to reach the loan processing officer of this company, You are expected to apply with the following details so we can furnish you with the loan terms for the transaction.

1. Full name

2. Full address

3. Sex

4. Age

5. country

6. occupation

7. Amount of loan needed

8. Duration of loan

9. phone number.

NOTE: DO NOT REPLY TO THIS EMAIL USED IN ADVERTISING THIS OFFER BECAUSE YOU WILL NOTE BE GIVEN IMMEDIATE ATTENTION. YOU ARE EXPECTED TO APPLY FOR LOAN WITH US THROUGH OUR APPLICATION EMAIL ADDRESS: mr.segunmoses17@hotmail.com THANKS FOR YOUR TIME AND WE WILL OFFER YOU THE BEST.

I find this to be almost the worst hoax email I have ever received. However, hundreds of people fall prey to the "Nigerian Scam" every year, so I thought it worthwhile to post something about this on my blog. First off, never give your information to anyone via email. Email inquiries are the most basic way a crook can get your info, but only if you cooperate! Reputable banks will not send you an email, they will call you.

Second, loan officers who advertise via blind emails are rarely worth your time. If they were good at their jobs, they would get referrals to grow their business. At the very least, a quality loan officer would realize that blind fishing via email is illegal due to the CAN-SPAM act.

Third, proofread a little. Anyone worth their salt is not going to send you professional correspondence with that many grammatical and spelling errors. You don't need to be an english teacher to see something wrong with this note.

With the economic climate rough, there are plenty of pirates on the financial seas. Make sure your ship doesn't get boarded! Check www.snopes.com and www.wikipedia.org if you think you might be getting scammed. Both are good sources of information. You can also file complaints with the FBI, FTC and Treasury Department online. However, the best advice I have is this: If you feel the slightest bit uneasy, trust your apprehension and refuse to give any information. Keep your cash in your pocket and out of the hands of crooks!

Every day there is a new story about how banks are dying to keep people in their homes ,and we have given them billions of dollars under TARP to do so. However, we're also hearing that Paulson lied and the TARP money isn't buying anything. What's really going on?

Well, I'm taking the high road on this one. My political opinion will remain my own for now, because what most people really want to know is if their bank will work with them. The answer looks to be a yes across the board. Most major banks have announced a willingness to work with people, and even the ones that haven't must be seeing the light by now. Citigroup, Chase, HSBC, Countrywide and Bank of America have all dedicated new departments to working out loans and trying to save them from foreclosure. The goal is to get payments into an affordable range so folks remain in their houses. In fact, the main article I'm quoting is right here.

The real question is how far will they bend to keep you in your house? I'm not really sure on that one. I've heard of a number of options, but not how much they will drop the payment to keep you in your home. I read one woman's story who was trying to get her payment reduced by about $400 and she had no end of troubles getting it done. Granted, I don't know what percentage of her payment that is or how long that would take her to repay at that level, but it seems like some banks might want to try harder to keep folks in their homes. I mean, they either made or bought these bad loans, so accepting some fiscal responsibility doesn't seem out of line.

If you do the math the choice becomes simple. If you foreclose on a home that has a $100,000 mortgage at 6% interest, not only do you lose that $100,000, you also have to pay for foreclosure. The cost of foreclosure is a pretty slippery number, and I've read some of the craziest takes on it. The funniest was the guy who posted that "PMI will pay for all the foreclosure costs, so the bank isn't out any money." Really? Maybe you should read the fine print! PMI only insures a portion of the loan, not the whole thing. Typically PMI only covers the top 20% of the loan if you finance 100%. Let's assume in this case that the foreclosure will cost about $30,000, which was the lowest number I found in my search. Let's also assume that the PMI pays the bank back 20%, which would be $20,000.

Now for the fun part. Normally costs start adding up after foreclosure, because the home has to be winterized, repaired and the like. Also, foreclosures typically fetch far below market price because they are in below average condition. However, just to make this simple, let's assume the home is livable if not perfect, it is summer so no winterization is necessary and the bank finds a buyer who can close in a month. Let's also assume the home sells for $60,000, or about 60% of its mortgage value. Once we do that, we can figure out what the bank lost. I'll add credits first, and then subtract debits.

(Home sale + PMI payment) - (Amount owed + Foreclosure cost)

or

($60,000 + $20,000) - ($100,000 + $30000) = - $50,000

So the bank just lost $50,000, right? Wrong. The bank also lost nearly 30 years of interest on 100,000. Let's assume these folks had 25 years left on their mortgage and they had a nice 6% rate giving us a payment amount of $599.55. After generating a quick amortization schedule, I see the total of interest in that remaining 25 years is $112,845.71! Granted, the bank has to pay people to service the loan and such, so its not pure profit. However, that is still quite a chunk of change. That brings the bank's total loss to $162,845.71. Are you kidding me?

Let's look at some alternatives. If the mortgage company had given a rate modification of 2%, the payment would have dropped to $477.42. Granted, they would have lost some money on the interest, as their profit would have dropped to $70,207.67, but they would have kept the $50,000 in principal and not had to pay for a foreclosure or file a PMI claim! That turns a $162,845.71 loss into a $42,638.04 loss! Doesn't that make sense?

Another option is to extend the term. I don't like this one as much, because going from a 30 yr to a 40 year term doesn't make that much difference, but let's take a look at it anyway. I know banks like this one because it keeps more interest income, but it doesn't seem to offer as much help as a rate mod in my opinion. Still, if we draw it out to 40 years, the payment drops to $550.21, which is still $50 a month! When looked at as a percentage, this option lowers the payment by nearly 10%. On a larger mortgage, the percentage would make a bigger difference. Let's say you pay $3000 a month for your mortgage. A 10% savings would be $300, or a car payment for most folks. However, if you managed to get the rate mod, you are looking at over 20% of your payment, or $600. Doesn't this option make sense to you as a consumer? It should make sense to the bank.

If you're looking for foreclosure help, these are some options your bank may offer you. If they don't, then ask about them. These options could help you save your house. Some banks are also participating in the Hope for Homeowners program run by HUD. Here is the link, so check it out and see if you qualify. Good luck!

DISCLAIMER: The numbers used are estimates. Payments would be slightly different if the remaining loan balance was $100,000. However, these figures give you a rough idea of what your bank may be able to do for you.