Cheryl Tolan

Well 2008 is now behind us and many of us have a sigh of relief. 2009 is a fresh start and for most of us it is needed. If you work in the real estate or financial industry and you are still here to talk about it - you are definitely a survivor.

It is interesting chatting with folks in different industries . . . some feel the worse is over, others feel we still have some rough spots ahead. Regardless, we must move forward and do our best in our industries!

Getting back to basics is the key:

• Using "common sense" in our finances, both for personal and business. DO NOT spend more than you earn. As a matter of fact, spend less!
• In marketing and prospecting efforts for your business, I have a theory, "LEAD BY REVENUE". If the marketing budget is tight, then it is time to go FACE to FACE and BELLY to BELLY with your prospecting efforts. Get out and talk to your clients and prospects!
• Offer exceptional service to our clients, the kind of service we expect and want. It is no longer good enough to just be good. We must go the extra mile. Return phone calls before they expect it! Send a personal note instead of an email. Send them birthday wishes! Ask your clients what they expect - this may surprise you!
• Smile & be Sincere!

I know that I am preaching to the choir but it never hurts to hear the basics again.

May you be Blessed in 2009!

Cheryl Tolan

Santa Maria is hour north of Santa Barbara in the northern tip of Santa BArbara county. We have seen a massive amount of REO business this past year.

In October, the total # of sales were 181 (single family residence) with 121 of those sales being REO properties. Roughly 95% of the remainder of sales were short sales.

November saw a slow down in the # of total sales - 143 with 103 of those properties being REO's.

We have seen the Notice of Defaults being recorded slow considerably but that is due primarily to the banks not filing those NOD's.

If you would like more information on the markets in Santa Maria or San Luis Obispo counties, please call me.

Cheryl Tolan 805.441.0221

Character

More than anything, creditors want to know your character. That is, they want to know something about your nature or disposition. Who you are is not so much your name, the kind of residence you have, or the city you live in - although this is, no doubt, important information that will be required of you. Rather, your "credit character" is determined by what, if anything, you have done in the world of credit through the present. It's not what you can say about yourself that matters but what your past actions say about you.

Things you will need to consider in the area of character include answers to the following questions:

When reviewing your character, lenders want to know what actions you have demonstrated to date. Take some time now to collect all of the data you have in this regard and begin to build a file on yourself. Note any trends you see (on-time payments, late payments, full or partial payments, etc.) and try to get an idea of the picture that others will have of you when looking at the same information.

Capability

"Remember the root-beer principles of borrowing," often counseled a college professor of mine. "Borrowers must be A&W," he would say referring of course to the famed producer of root-beer.

What this learned individual was attempting to draw the attention of his students to, is the very idea that every potential borrower must be able AND willing to borrow. If both criteria - ability and willingness - are not met, a loan application will not be approved.

For most consumers, lack of willingness is usually not an issue. The primary issue in this instance is most often ability and that is precisely what a creditor is going to look at in determining whether or not to approve your application. While one's ability to borrow is determined by a variety of factors there is probably no larger consideration than the capability of paying the loan in question. Simply stated, lenders want to know whether or not you have the means of repaying the loan plus interest.

Things you will need to consider in the area of capability include answers to the following questions:

Remember, you may be very willing to borrow but the key question for you is, "Can you borrow?" This is what lenders want to know and this is what they will look at when considering your "credit capability."

Capacity

"What is capacity?" you ask. In short, it is the difference between the amount of the total line of credit you are considering (any current lines of credit plus that for which you are applying), minus the actual amount of the credit line you are using.

Let's say, for example, that you currently have a total credit line of $15,000 via three credit cards and a personal signature loan at your local credit union. Let's assume further that of the $15,000 available, you have used $8,500 for various expenditures. That leaves you with a net credit line balance of $6,500. Stated another way, you have used about 57% of the total line of credit available to you. This is what lenders mean by capacity.

Things you will need to consider in the area of capacity include answers to the following questions:

Cheryl Tolan

805-478-9018

Below you will find the 5 areas that help calculate your FICO score.

Payment History:
Approximately 35% of a credit score may be based upon payment history. A credit score is negatively impacted if bills are paid late or if there is a history of delinquent payments listed on the credit report, including matters of public record such as bankruptcy, collection accounts, etc.

Amounts Owed:
Approximately 30% of a credit score may be based upon amounts owed or other outstanding debt. A credit score can be negatively impacted if the amount owed is close to the credit limit. A low balance on two credit cards may be better than a high balance on one credit card.

Length of Credit History:
Approximately 15% of a credit score may be based upon length of credit history. A credit score can be positively impacted the longer that accounts have been open, especially if they are with one financial institution.

Taking on More Debt:
Approximately 10% of a credit score may be based upon how much new debt a consumer is incurring. A credit score may be negatively impacted if someone has recently applied for a number of new credit accounts. Promotional inquiries usually do not negatively impact a credit score.

Types of Credit in Use:
Approximately 10% of a credit score may be based upon the types of credit currently in use by a consumer. A credit score is usually negatively impacted by loans from finance companies.