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

D-I-V-I-C-O-R-C-E, Tammy Wynette sang out years ago, spelling to keep a 4 year old from understanding! Just like the attorneys and the judge mislead the divorcing couples (?), ex's (?), losers (!).

Tammy misspelled it! It should have been B-E-T-R-A-Y-A-L, B-E-T-R-A-Y-A-L, B-E-T-R-A-Y-A-L, or betrayal to the third power! Betrayal by your spouse, betrayal by your attorney, and betrayal by the judge!

I'm a finance and real estate expert, married to the same wonderful woman for over 37 years, so were not going to talk about betraying your spouse. This is about real estate and money!

The parties to a divorce are betrayed by their attorneys and the judge when they allocate the bills and tell one party or the other, that your spouse is responsible for some items and you're responsible for others! They spell it out, just like you do in front of the kids! They spell it out, so you think that you are no longer responsible for selected debts! The divorce judge has no authority to discharge anything other than your legal responsibility to your marriage vows.

If you were responsible for any debits before your divorce, either by signing on the account, using the credit cards, or you live in a community property state, you are still responsible to those creditors after the divorce.

The accounts are still going to show on your credit report, (Affecting your FICO scores!) until 7 years after they are paid off!

If your Ex defaults you are still responsible for those accounts, and can be sued!

If your Ex defaults your current personal credit cards are probably going to jump to thirty some percent interest!

So many divorced people believe that because a divorce judge says their Ex is to pay a bill that they are no longer responsible! When told the truth, normally when trying to buy a house, their first response is that's not fair! Welcome to the real world! It wouldn't be fair to the creditor that lent the two of you money to now be told he can only collect from one.

If you're going through a divorce, demand that all joint accounts be refinanced into one name, revolving credit, credit cards and open ended accounts, if not paid off should be canceled. If you're on the account because you signed the original application, you can cancel the account, if your liability comes from using the account, or community property laws your spouse (EX) must cancel it.

Canceling a revolving account does not require paying it off, but rather stops further advances.

Some on going accounts can't be practically canceled or paid off. I've never seen it, but your attorney should demand that your Ex provided proof each month that accounts are being paid, such proof should be canceled checks. Again it would seem reasonable to refuse to quit claim any property to your Ex before the entire mortgage is paid off. Once you've quit claimed you interest to your Ex, you're still liable for the mortgage, but have no way of recovering the property, if they should default.

When applying for a mortgage underwriters (the person making the final decision) will not hold payments being made by a third party against you if you can prove they have made the payments for at least the last year, or the life of the obligation which ever is less. (This rule also applies to your kids car loan if you co-signed.) The key is proof, insist on them paying by personal check, and don't be on the account!

Women, traditional women who took their husband's name, can under Federal law have joint accounts reported in their (new) name, this would also apply to men if joint accounts were reported only in your wife's name. I'd request reporting selectively, you'll have to claim all your debits when applying for credit, but you might possibly protect your FICO score.

Child support, alimony, and/or separate maintenance, if you are receiving any or all of these payments from your Ex, you don't have to list them as income on any credit application. That is if you qualify for the loan with out the income! If you need the income to qualify you will have to prove you receive it and that it is on going. The court order will prove that the income is on going, but it will take the co-operation of your Ex and some preplanning to prove you receive it! Unless the money is collected by assignment or garnishment demand payment by personal check, and don't be on the account! When receiving such payments always pass them through your checking or savings account! Always! You must be able to prove you've received one years worth of payments or all payments since the settlement which ever is less.

Child support, alimony, and/or separate maintenance, if you're required to pay any or all of these you must list them on any credit application!

To finance a home you must have or establish credit in your own name.

 Don't forget: open a personal checking and savings account, check and change utilities, insurance, real estate and state and Federal IRS taxes (the IRS can be negotiate with.) Check and change your insurance, 401k, Kehoe, and other retirement accounts. Change you ID!

Bill

William J Archambault Jr

The Real Estate Investment Institute

 

Like marriage if you have assets it's best to plan ahead. You have everything to loose.

This is not about "Gay Marriage" trigger by it, but about Marriage, Real Estate, and Money. Regardless of how we feel about marriage, in any marriage there are some simple credit and real estate matters that everyone considering marriage should think about.

 1. Credit! In community property states your spouse, regardless of gender brings their credit with them. Bad or excessive credit should not come as a surprise! Every thing dome after the wedding will involve both of you, with you being jointly and severally libel for your spouses debt! Depending on the state you take up reference in you may be liable for debts accrued before marriage.

 2. You may be aware that mortgage lenders often split a spouse with credit or income problems out of the transaction. Are you aware that some loan programs no longer allow this?

Are you aware that in many states judgements even those of your spouse attach to the property before that spouse can waive their rights to the property. This means even though they're not on the loan their credit can stop your loan! They don't have any judgements, what about tax liens? Judgements and liens may be in other names, a woman has choices when she gets married? You'll need to check any and all names your new spouse has ever been known by, and any and all names of every legal spouse! Does anyone know what the policy is or will be for "Gay" names?

3. Pre-nup's. I don't personally believe in them, but older couples and second marriages with children or major assets should have them.

4. Vesting. Most married couples take title to property as "Joint Tenants" or "Tenants by Entireties, (Joint Tenancy by a married couple,) but older couples, couples with prior children should consider other options, normally "Tenants in Common"! Tenantry is a separate subject.

I've never advocating holding investment property in the same manor as your home. I believe most investments should be held by an "LLC" which is owned by a well planed "Living Trust." Again the more you have to protect, the more you need good advice an a plan. Those considering marriage need to do some financial planning first! Just getting married doesn't necessary change your insurance, call your agent! Your new spouse may not be covered! Hazard insurance may not cover your new spouse's newly acquired interest in you real estate. Your car insurance should be checked, your spouse is probably covered when driving your car, but if named they would cove them in any car they drive. Check with your agent. Life insurance? This is a very good time to reconsider your needs, check with your agent.

 5. Insurance! Some of you think this is all basic common sense, but our "Gay" clients never had this option before. Most of our older widowers and divorcees never considered it either. Remind the kids it's marriage before offspring! Remind older lovebirds to plan their finances, first.

Bill

William J Archambault Jr

The Real Estate Investment Institute

The Supreme Court ruled today that the right to gun ownership is an individual one! Just like all the rest of the Bill of Rights,

Dissenters may worry about armed citizens, but only because out of a sense of superiority or igorance, Only criminals or tyrants have anything to fear from an honest citizen with a gun!

Bill 

   

There is always more than one way!

Thursdays June 26, 2008 marks the sixth anniversary of the start of: The LeMay Coal and Feed Delivery Service, The Candy Bomber Brigade! A/K/A The Berlin Airlift started 60 years ago Thursday.

The Soviets had closed off West Berlin!

They couldn't be supplied with life's necessities! The West Berliners faced starvation or capitulation! Continued attempts to supply Berlin by road or rail meant certain war with the Soviets. The nay sayers proclaimed "It couldn't be done!"

But! When faced with need or adversity, there is always more than one way! The job fell to Major General Curtis LeMay, then commanding the USAAF in Europe. Using the small transports and bombers left over from WW II, the same planes that had delivered paratroopers and bombs to Germany less than 4 years earlier, he/we feed the Berliners by air until the Soviets relented almost a year later on May 12, 1949.

The over worked pilots, bought moments of joy to otherwise depressed/repressed young victims of adult political tyranny, by dropping candy out the windows of their planes.

There is always more than one way, wisdom we'd do well to remember in our everyday lives.

Bill

William J Archambault Jr

The Real Estate Investment Institute

Three score and a few weeks ago a young man home from war in the South Pacific was presented by his high school sweetheart and wife of two years with me. Father's day was simple, change the diapers, heat the bottles, feed the kid, change the diapers, heat the bottles, feed the kid. By the next year my brother Oops, had joined us, Father's Day that year was much the same with twice as much work. Dad's third Father's Day was a little easer Oops and I ate at the table and I was out of dippers. Shirlie joined us for the next Farther's Day and life was good.

Twelve years after my birth along came Little Oops, there years later came O'my God.

Five kids, one Dad, five experiences, all different, all good. Being the oldest Dad and I did what needed done, teaching me along the way. I was a second set of hands, a needed assistant I loved it. A year later Jack, Opos felt put upon, he learned partly because Dad insisted, partly because he was so bright. We were both Loved, but it was a different experience. Shirlie, Dad's little girl had an even more different, experience, not because there was any difference in the love of the three of us, but because she was born at a time when girls were girls not boys in panties.

All the love, all the caring, all the same, but experienced differently. Dad and I shared a lot, as he did with his Dad, and Grandpa did with Great Grandpa. I was fortunate to experience them all.

I know I'm who I am because of those three men and my maternal Grandfather. Dad's the only one left, I hope I've made him proud and I hope my kids feel the same way. I hope we have a lot more Father's Days together.

My experience is closest with Little Oops, Joe and O'my God, Tom, I envy those two they lived with Dad in the years after the pressures of a young man's family, but I wouldn't trade my experience for anything.

Dad I love you.

Bill

Father's Day 1948. That's me in my Father's arms, Great Grandpa, Robert Stephen Saxby Archambault, and peeking out from the back is my Grandfather, William Jennings Bryan Archambault.

 

 

Shortly after Dad's first Father's Day Mother telling me Dad had to mow the lawn. Then Dad is explaining to me that all that grass will soon be my responsibility to mow.

Are you a real estate "Expert" or a "Professional?"

I write in Correl Word Perfect so I started by looking up the two titles in it's dictionary.

"professional > ... a person having impressive competence in a particular activity."

You'll notice "..." I left out the parts about "being part of a professional group" that's just plain wrong! You can be a member of a group with out being professional and you can be professional with out a group! I also left out the non-sense about "being paid" experts are paid, incompetents are paid, totally unskilled labor is paid. Being paid regardless of the amount is no measure of professionalism! Welfare mothers are paid are they professional and our mothers amateur?

"expert >noun a person who is very knowledgeable about or skillful in a particular area."

I might have added "small" as in "skillful in a particular small area!" This is in contrast to the very general particular activity, defining the professional.

It use to be said, "an expert is anyone more than 50 miles from home with a briefcase!" At today's gas price maybe that should be amended to say: "an expert is anyone more than 20 miles from home with a briefcase!" After more than a decade traveling around the country with the old Farm and Land Institute, I think I understand that old definition. People 50 miles from home didn't know you weren't an expert, and if you are an expert it's safe to acknowledge you because you're probably not a competitor! Today the internet, cell phones, fax machines, and overnight delivery has made us all competitors. So today experts really do need to know everything about a very limited subject!

Experts work cheep! How can someone who may charge you several hundred dollars an hour be cheep? It's very simple you can make money on an expert's advice.*

Experts must know the answers!Professionals must know the questions!

Professionals, real estate professionals coordinate the entire real estate process. To be a real estate professional is a matter of attitude, fortitude, and tenacity! It's not necessary to know the answers, it's necessary to know and ask all the questions! It's necessary to select and control the experts. *Those o'so valuable experts go from cheep to outrageously expensive if ask an open ended question or the wrong question! The professional's job is to protect his client and get the job done! The expert's job is to answer the questions ask.

It's possible to be both professional and an expert, but why limit yourself? Experts will always be necessary. Necessary to the professionals! Professionals with broad knowledge are so much more useful! Professionals know there is always more than one way, if any one expert isn't available there is always another way to get the information!

Now go solve a client's problems!

Bill

William J Archambault Jr

The Real Estate Investment Institute

Sixty-four years ago this morning The United States of America and it's Allies once again came to the aid of good people in need.

No one wanted to die that morning.

No one wanted to die in that war.

No one wanted to die for strangers.

But, so many willing faced death because defeating evil, at the point of infestation, not in our front yard, is so much more important than our own personal interest.

Let us pause and bless the memory of those that gave so much, and those that risk everything.

 

 

 

 

 

 

 

 

 

Let us also remember those responsible, not the dictating despots, but the spine less, mind less, moral less, compromisers, appeasers, the enablers!

Evil, Naziism, Fascism, Imperilism, communism, bigots, and now fanaticism will always be with us. But, so many had to sacrifice themselves because of the Neville Chamberlain's!

Bill

William J Archambault Jr

After so many years of qualifying mortgage clients by the same rules our fathers, or Grandfathers played horseshoes, many loan originators have never had to actually meet strict numbers!

Well times have changed, close no longer works! You've got to throw ringers or lose. Those pesky Debt to Income and Housing Expense ratios have again infested our vocation. We've virtually ignored debt ratios for over a decade, but no longer.

We add up those selected recurring payments from the right side of the 1003, then add the proposed housing payment (PI-TI, MI) and divided it by the allowable portion of the applicant's income. Then we panic!

 Despite the clients demonstrated ability and willingness to pay, the back end ratio, Debit to Income, DTI is to high to meet the program guide lines. Now what? I would determine how much I had to lower the total monthly payments and how much cash the client had available, or I could generate for him.

 In the past.

I'd look for payments we could allocate/blame on some one else, and can we prove they make the payments (You must prove someone else made all the payments or the latest 12 payments, which ever is less. If your ex was ordered to make the payments, you must prove they've made the last 12 payments or all payments since the court order, this normally takes co-operation.

I'd look at the non-revolving debts and determine the remaining number of payments remaining. Usually, you can excluded debts that have 6 payments or less remaining, or that can be paid ahead so that there are only 6 payments or less. (Just because you're talking about a conforming loan program, Fannie Mae or Freddie Mac, doesn't mean all lenders have the same standards. The number of payments left that can be excluded can vary from none to 12.)

Reducing the balance on non-revolving debt, if it reduces the term can be an affordable method of reducing DTI. Also, consider refinancing supper friendly loans, with credit unions and local banks or S & L's, either extending their loans to reduce payments or raising payments so that the term is 6 months or less. Yes, I did suggest raising payments to reduce DTI!is that paying off, buying down, and excluding also works with child support! Changes in child support will take cooperation from the ex and a court order! Where did the "hazard insurance" (The second "I" in PI-TI.) estimate come from? Insurance is often considerably less when your car insurance and home owners insurance are from the same company, even more when there are two (or more) cars and the house. Married couples often miss this. Those playing house almost never consider it, "Gays" and straight room-mates, rule themselves out, but this savings is also often available to any couple buying and living in a home together. Talk to the insurance agent, your clients may well end up with better insurance at a lower cost.

An often over looked opportunity, an over looked freebie.

I'd have taken a copy of the 1003 and recheck the listed payments against the minimum payment as listed on credit report. If you list the $200.00 that the client says he pays each month as opposed to the $36.50 he's obligated to pay, the whole $200.00 will be included in the DTI! I then divided each revolving debt payment by the loan balance, noticing the percentage of the payment compared to loan balance. I do this because the client rarely knows the cost of revolving debt and if we do recommend reducing or paying off revolving balances that we get the most payment reduction for the dollar.

Be careful! Very careful!Finally, revolving credit holds the promises that you can pay it down or off today and get the cash back tomorrow. Don't let the client use money he'll need to close and to meet reserve requirements!

Manipulating revolving debt is like doing surgery with an ax, a doubled bladed ax! With one strong stroke you can instantly cut your payment and life is good! Until, you discover that your back swing killed your credit score. Anything and everything done with revolving debt must be carefully planed! Improvements in DTI must be tempered with the effects on credit scores.

Start with a freebie!

Have your client call his higher cost credit card holders and ask for a reduction in his interest rate! It's often that simple! Ask for a fax confirming the reduction and the new minimum payment. Credit scores are not affected by the clients balance, but they are affect by the amount of your total balances compared to the total available credit, so this is a good time to also have the client ask for an increase in their credit limit.

Don't close revolving accounts with a mortgage pending!

 Don't open new charge accounts!

Transferring balances to a new account will often reduce DTI, but the effect on credit scores isn't worth the savings.

Do consider transferring balances between existing accounts to reduce payments.

 

Don't let the client spend money or commit to spend money until you've shown the file to underwriting! You're not sneaking anything by the underwriter, so ask; "If we do this can you approve the loan? Do you have any other suggestions? Ok, please approve the loan contingent upon these changes."

Troubled and marginal clients will forgive you for not getting them approved, but not if you've cost them money!

Bill

William J Archambault Jr

The Real Estate Investment Institute

For the record, close only counts in horseshoes and hand grenades!

Jeff I'll Get You Back, Jason Sardi added to the challenge, so here is my meme. At least this time Jeff ask specific, but strange questions. To start at the beginning, the very beginning see: Memed, Me Memed / For The Masochistic Reader

"1. Who is your favorite musical artist?"

This of course depends upon the time. In my youth it had to be Johnny Horton, "The Singing American," and I can't forget Gean Autry. In high school and collage it had to be the Beach Boys, their "I Get Around" could have been written about my two best friends, Lynn Bingham, Tom Gysel, and I. Strangely, for most of my life I would have said, Lee Marvin and Client Eastwood. I love "Paint Your Wagon!" Currently, Garth Brooks, I found the symbolism in one song "Fever" describes the very best in human nature! My pod-Cast about Brooks' song is at: 3/15/2008 3:21 PM

"2. Who is your favorite artist?"

With out question! "Rubens!" There are two ways to look at "Rubens" some would say he was just a pervert with a fetish for fat women, I feel sorry for those people they so often find most people perverted. Personally, I believe Rubens saw the beauty in all people even those as obviously flawed as most of us. Viva La Difference !

"3. Who is your favorite blogger?"

It probably wouldn't be right to say "Me" so let me start with "America's Most Opinionated Mortgage Broker!" What we did together going back and forth on each others blogs, none of which was preplanned. There has been no better educational posting since. As Brian evolved into "America's # 1 Mortgage Broker" I would not call him my "favorite" but he's the one I most admire! We all blog to market our products, services, or both and no one does it better than Brian.

I don't currently have a single favorite. But, here's who I read, in no order:

Jeff Belonger, Mortgage Knowledge at its BEST!!!! There is a lot of good, often great lending knowledge buried in his FHA propaganda! (Remember Jeff, you asked!)

Jason Sardi, When I understand him, there is a lot of true insight in young Mr Sardi's blogs. Interacting with Jason is like having a third kid, as you know all our kids are great.

Bryant Tutus, Broker Bryant's Real Estate Ramblings Bryan writes from a limited point of view, but with great insight! Bryan is the kind of person everyone wants as a friend. He may not have a fiduciary duty to his clients but he could represent me any time.

TLW, "The Lovely Wifes" Blog.... The Right Reverend Billie Tutus, herself, her indiscreet blogs are good for the soul! In the rare instance when she writes about real estate, she shows a great understanding.

Evil, Rich Kruse,/blogs/rf1721

 Rich brings realty to AR and although he wouldn't admit it a lot of humanity. Rich and Melissa are the people you'd want to live next door. The best of the "Heartland" with a strong dose of reality.

Jon Zolsky, Jon's Blog A legal immigrant! Jon lives and understands the "American Dream" everyone of us who've ever made an excuse for failure or mediocrity should look to Jon for inspiration! His real estate is not to bad, either.

Lenn Harley, Broker, Homefinders.com in Maryland and Virginia 9 out of 10 post are real estate listings (nice houses) but that tenth post is must reading!

Mike Jones, Tucson AZ Home Loan Info

Possibly the best original photos on AR.

Palm Beach Real Estate and Loans - Marc Blasi

/blogs/billroberts

 Ron's Blog----Strictly Speaking!

Bill Nazur--Mortgage Mastery..Making a Difference

/blogs/richThe Mortgage and Finance Planning Resource: 

The Mortgage and Finance Planning Resource:

Florida's #1 Certified Mortgage Planner's Blog

Ron's Blog----Strictly Speaking!

Sound and Fury

/blogs/williamjohnson

 Jennifer Bukaty's Portland Real Estate Blog

"4. If you could meet anyone (alive or dead), who would it be and what is the most interesting thing about them?"

I've had the opportunity to meet a lot of heros, especially those in aviation. One I missed was Curtis La May, early pilot, USAAC, General USAF, hero and leader in the air war in Europe and Japan. Besides flying, La May understood war, you can't fight a limited war. Until they perfect limited death, like kids when you're shot you lay down and take your deads, then you jump back up, that's limited. La May understood, if it isn't worth winning it isn't worth asking men to die for! Read his books, fascinating.

"5. What did you want to be when you grew up?"

John Wayne!

"6. What is the most interesting piece of trivia you know?"

I know what Nixon did and didn't do.

"7. If you could live in any point in history what would it be and why?"

I like where I'm at! I've had the benefit of knowing many truly great people. That couldn't have happened even a few years before or after. I except to live another 40 some years and I believe we're facing some of the biggest moral and social issues of all times, It's going to be fascinating!

Besides this is Brenda's time and she's the most important thing in my life.

 "8. What is the most interesting job you have ever held?"

In High School and collage I worked as a photo journalist, it was incredible. George Romney used some of my photos in his presidential bid. I met and photographed Reagan and Humphry.

I've often wondered what if I'd gone back, I could have. But, when I got out of the Corp, I didn't pick up my cameras again until Eric was born. I wouldn't have missed Brenda, Eric, and Amy for anything. Besides, who ever heard of a conservative journalist?

Bill

William J Archambault Jr

The Real Estate Investment Institute