The Real Estate Sage at The Real Estate Investment Institute - REII

As the mortgage scandal continues to evolve, as fingers keep pointing, as facts are ignored, as politicians, bureaucrats, and other crooks struggle to pass the buck and befuddle the public with male bovine droppings! Are, the minions at HUD-FHA benevolent bureaucrats or self-serving power mongers?

Because so many have said the problem is public confusion so  HUD has rearranged the "Good Faith Estimate" They care, they took action, they changed the order of the confusion thus making the consumer more aware and informed. I feel more informed, already!

 Because so many have said the problem is little or no down payments, The FHA division of HUD has announced that as of January 1, 2009 their down payments will be increased 16.67%, to 3.5% up from 3.0%! Wow! On a $150,000.00 loan that extra $750.00 of down payment is going to protect the consumer and the tax payer! I feel safer already!

Because so many have said the problem is "undeserving" "uncredit worthy" low FICO score would be home buyers, buying homes, FHA becomes the lender for the lowest possible scores. I feel, I feel befuddled, baffled, and a bit bewildered.

Because so many have said the problem is foolish consumers buying over priced housing HUD has raised FHA loan limits to over $600,000.00 in most areas and over $900,000.00 in others. This from the agency chartered to help the economially challenged become home owners. I feel confused, if the poor can afford nearly million dollar homes, what do we call the masses?

Because so many have said the problem is we need tougher regulation, we need protection, we need to stop the "undeserving" and "uncredit worthy" it's good to know that our government cares! It's good to know our government can define the "undeserving." I feel reassured, between shysters and incumbents incompetents life will go on!

Do not confuse my discuss with HUD-FHA as applying to the brokers and bankers that sell it. For the first time since 1974 I'm regularly recommencing FHA loans.

Bill

William J Archambault Jr

The Real Estate Investment Institute

On the 15^th of September 2006 I published Wake Up And Smell The Smoke a long winded story about making sure you had enough Hazard Insurance / Home Owners Insurance, to cover the newly inflated value of your home and investments. Many of you may think you can do with less coverage at today's deflated values. You may be wrong!

It's time to reconsider your insurance! Most people will have a fixed amount of coverage barely covering their mortgage, this could be a costly mistake. My concern is that the cost to rebuild your property may well exceed it's current value less the value of the lot. You may find that your insurance company may only be willing to pay the current value of the house!

If you owe $200,000.00 on your house and the insurance only covers it's $150,000.00 current value you may find that you have no house, and no money. (Remember, the bank cad and may well take insurance proceeds!) And, you still owe the balance of the loan at it's original payment.

There are hazard insurance policies that will pay to rebuild the property. All I'm suggesting is that it is once again time to talk to your insurance agent!

Having experience my first hurricane, Ike, I'd suggest you check your flood insurance. I understand that many people may not be allowed to rebuild on their slab, but rather be required to elevate their houses, those with out sufficient insurance may not be able to afford the extra cost.

Bill

William J Archambault Jr

The Real Estate Investment Institute

Two things caught my eye this morning, an ad in the local newspaper, and a story on the national news. Please, tell me if you can find any sanity.

"2008 Escalade 2WD

$65,920 MSRP

$61,006 Your Price

-$10,000 Cash back

$51,006 Red Tag Price After All Offers

$14,914 Total Value Versus MSRP"

At a time when consumers are abandoning their homes and personal responsibly because they are "upside down" is there any sanity in voluntarily, accepting $10,000 cash back along with the 20 to 40% you lose just driving a new car off the dealers lot? Why should anyone make even one payment when they owe as much as $38,368 more that the true value?

Is "Total Value Versus MSRP" the same as thing as REO or Short Sale buyers thinking the have equity, because their new home, that they just purchased for $237,721.00 once sold for $561,350.00?

Dose anyone believe we can profit or save money by buying things we don't need at a discount?

I wasn't paying much attention to the news until the man they were interviewing, I think he was speaking for GM, but I'm not sure, he suggested an alternative to the bail out or bankruptcy. What the man suggested was, why not help GM sell cars? Now that caught my attention! He went on to suggest the Washington loan our pilfered money to GM at 4% so they could sell cars to people that need them, sounded better than grants or other loans. Then he suggested they could establish a default fund, so that no money would be lost, said fund to be charged the buy at 4% each month, so far so good. Then he went on to say they would charge the troubled consumer a total of 13%!

Talk about insanity and greed, they would sell us cars at invoice but they would collect 5% for administrating our tax dollars, on loans that could have no losses because of the contingencies fund. Just how stupid do they think we are?

There was some good news, well sorta. It seems there are new rules about credit card fees and intrest, that may put an end to "universal default." Of course they leave this monster in place until 2010.

Bill

William J Archambault Jr

The Real Estate Investment Institute

I started this morning reading a friends blog. My friend is the epitome of The American Dream, his story is a true inspiration. But, my friend hasn't been here through tough economic and social times, even though he's known real tough times.

My friend wasn't here in 1973 when money was regionalised, California bankers had a cornucopia of cash, but the Midwest bankers had none. Rates spiked in ‘99, but Jimmy Carters legacy was an historic high 21.5% home mortgages! Ronald Regan's legacy, the longest peace time prosperity in our history. America, Americans have always come back and we've always been better for it! We've had some shameful moral lapses, slavery, WW-I and WW-II, but we've always end up doing the right thing, least normally .

Yes we've been trough allot of things. Lately, we've allowed hate to replace logic, compromises to replace patriots, demigods to replace leaders. If this sounds like Germany in the ‘30's and scares you, you're not alone!

Take heart my friends! America is, has been, and always will be resiliently good.

In times of sustained abundance we've sometimes loss sight of our morals and responsibilities. In tougher times we've look for a scapegoat to blame, just like all the others unwilling to face their own culpability. But, every time we've snapped out of our malaise and done the right thing! Every Time! We'll come through today's problems to and in the end be better off for it! Don't worry about the cost, our Grandchildren will pay for it as we do for our forefathers, discussing, but true.

We now have a choice to make we can sink into depression over the economy and society, for we are in trouble or we can wake up excited each morning anxious to see what today brings. These are interesting times, fascinating times, historic times, I wouldn't miss it!

Bill

There is a TV commercial for a new Guru that ask if you want to succeed, well who doesn't? All thing considered I've been in one form or another of the people business since I was 14 years old back in 1962 and I have yet to meet anyone that wants to fail. Wanting is not enough! Wanting to succeed is not even relevant to success!

The question is are you willing to do what it takes to succeed?

Most of us are not willing to do what's necessary to succeed. Most are happy to just be average. A friend ask me if I was willing to take investment advice from an average real estate salesman. My answer was of course NO! Settling for average, being mediocre is not success. The average salesman wants to be successful, but remaining average shows they aren't willing to do what is necessary to succeed.

2009 will soon be upon us, new challenges abound, are you willing to succeed, are you willing to do what it takes?

You've got almost 3 weeks to decided! Consider what these success have said:

It may take repeated effort.

 "Success consists of going from failure to failure without loss of enthusiasm." Winston Churchill

You have to be a self starter.

"The ladder of success is best climbed by stepping on the rungs of opportunity."
Ayn Rand

 Like a Boy Scout you must be prepared.

"One secret of success in life is for a man to be ready for his opportunity when it comes."
Benjamin Disraeli

 Am I to critical? "Criticism may not be agreeable, but it is necessary. It fulfils the same function as pain in the human body. It calls attention to an unhealthy state of things." Winston Churchill

Bill

William J Archambault Jr

The Real Estate Investment Institute