I originated mortgage loans from about 2002 until 2006 or so. I considered starting my own mortgage brokerage but decided against it for several reasons, including the growth of my real estate company and the vast changes in the industry after the sub prime crisis. That required more learning than I could spare if I wanted to properly manage my real estate brokerage. I no longer originate mortgages. However, I do know the difference between interest rate and APR.

For most of my time in the industry I worked for brokers, not direct lenders. They seemed to me to have more flexibility in placing loans. My first company said that applicants who made one application with her had dozens of options whereas anyone who applied with a local bank had but one. In 2002, that made sense. It no longer does. Changes in the laws of the land, especially here in New York, have marginalized mortgage brokers and given large direct lenders an advantage in the market place. The reasons why are for another post; the fact is that consumers who use a broker need to know some things. 

First, mortgage brokers are not able to make loans. They place them with 3rd parties. This is  not bad, but it does make a pre approval from a broker a lie. Mortgage brokers can issue prequalification letters. They cannot issue a pre approval letter. They can’t loan. As a matter of fact, New York compliance regulations stipulate that mortgage brokers state that they place loans with 3rd parties on their letters. You’d be surprised how many do not. DUMB. 

Second, mortgage brokers have to disclose what they are earning on a loan (otherwise known as yield spread premium). Bankers do not have to disclose this. Fair or not, it is the law. While pricing is not firmed up until you lock your rate, it is important that you as a consumer get a good faith estimate at the time your application is made. Too often, I have dealt with buyers who did not like their closing statement, and when I asked them what their GFE (good faith estimate) said, they told me that they never got one. It was coming. They couldn’t get it right away. The dog ate it. In any case like that, they were victims of an unethical practice. 

In New York, many good brokers have gone out of business. Public perception has put more confidence in banks, and brokers have borne the brunt of the economic downturn with the sub prime meltdown and so many stories of fraud in the news. You would think that this would make the existing brokers more mindful of watching their Ps and Qs, but in my experience, the opposite is the case. With one notable exception in my experience, mortgage brokers have not adapted to the new environment, causing suspicion and uphill battles.

I still get bogus preapproval letters with no compliance verbiage on Microsoft Word forms. This makes getting an offer accepted really hard for the borrower, who has no idea that they are at a disadvantage. I still get assertions that a borrower is a “slam dunk” from originators at brokerages, and when I ask what the Desktop Underwriter findings were for the borrower I get a blank stare. Desktop Underwriter, or DU, has been the industry standard for both bankers and brokers in automated underwriting. It isn’t foolproof but it is an indication of accuracy and thoroughness. If a borrower hasn’t been submitted to DU without a really valid reasons they are a huge question mark. 

Caveat emptor to both buyers and sellers. Find out who is vetting the prospective buyer/borrower, because that can be the difference between a good sale and a long drawn out non-deal that wastes weeks and months. 

The Westchester-Putnam Association of Realtors has featured me in their monthly spotlight in the Real Estate In Depth publication. The link is a pdf and the article is on page 11. It is a nice piece, and as much as I am tempted to beat my chest, much of my interview for the article was actually on Paul and Kevin Crego (misspelled “Prego” in the article), who taught me the real estate business. 

Kevin was my college roommate at Villanova and recruited me for years to come and work with him and his father at their brokerage in Rochester. I was with them for 5 years. 

It is tough to summarize a 14 year career in a short article, so Paul and Kevin did not get a big role, although I am gratified at the last sentence of the piece- 100% true. 

I had a chance to catch up with Paul and Kevin, as well as their better halves, Helen and Elle, when I was in Ithaca on June 13th. We met in Aurora, New York for lunch, and had a wonderful reunion at the Aurora Inn overlooking Lake Cayuga. 

There is no closer friendship than those with whom you have shared such an intense part of your life as building a career. For 5 years Paul and Kevin treated me like a son and brother as I grew in the business, and when I felt it was time to go come home to Westchester and build my family and career here they remained my biggest supporters. 

We all still work very hard in this economic climate, so getting together in the middle of the state for lunch was about as much as any of us could spare. I was in Ithaca to stand in for my late brother at the Cornell Crew Alumni row, and they were able to play hooky from business in Rochester for half a day. It was not lots of time, but it was quality time. 

I could write a book on each of the things I’ve touched on here, but there is work to be done, and I’ll indulge another time. Suffice to say that time like this are too rare, and one of my goals is to make them more common. 

Time with loved ones is what it is all about. 

I start a new, invitation-only group, and the first 2 people I invite are a Dallas Cowboys and a Boston Red Sox fan! Politics may make strange bedfellows, but so does business! The things I do to feed my kids! 

All kidding aside you two are the best, and we’ll close the Metroplex and Metrowest for the group now. 

Welcome. 

The group is for agents who are either already outstanding in the field of listing expireds or those who strive to be. A few groundrules:

• All posts are private. This is not for your hyperlocal, diary, rants, or other sorts of blogs. 
• One agent per market only, please. We can’t give our secrets away to the competition. 
• In that spirit, if you are here, you agree to keep group material confidential. You also agree to not sell it or use the information for anything other than listing more expireds in your market place. We aren’t here to create gurus, we are here to get more listings.
• If something works well in one market area it may not do as well in another. 
• It goes without saying, but listing expireds is a numbers game that requires consistency. This is not the magic bullet group!

This past weekend, to my surprise, a brief rant of mine entitled Treat My Yard Sign Like Your Own was featured on the dashboard and got quite a few comments. Most agreed with my premise that the agent who removed my sign from my old listing without telling me where it was taken should have called me. A few people responded that if I wasn’t there to remove my sign immediately that I was wrong. 

That could be true, but without an unneeded rehashing of the details, let’s suppose I was indeed wrong. When did it become OK to do the wrong thing just because the other guy was wrong? We don’t really get a “free one” or a “get out of jail free” card when we are responding to something that was wrong, do we? 

I am on the other side of this 99% of the time. I won’t tell you how many hundreds of expired listings I have procured since 2005 but it is quite a few. I’ve listed the expired listings of newbies who quit the industry 1 month into their contract all the way to those of superagents who sell tens of millions, year in, year out. The story is always the same: if you don’t sell the listing you are a bum. If you get it sold you are a great guy. 

In every case, I have taken the old sign and placed it respectfully in an out of the way place. Sometimes, the sellers would point to an uncollected sign as proof that the last agent didn’t care or wasn’t on the job. They never asked me to do anything with the sign. Ever. Not my responsibility, and if they did I’d tell them it wasn’t my property. I recall in one case I returned a lockbox and heard an earful from the other agent. I’ve even had instances where a lockbox remained on my front door knob for 2 weeks and I was forced to put mine in a railing. We can’t remove electronic ones, so all I do is call the other broker and ask for their cooperation. They comply. I would do the same for a sign. 

I am there as much as anyone, folks. I have plenty of chances to be punitive or judgmental. Retribution is not worth it. We are in this business to build bridges, not burn them. There are bigger battles to fight, and giving a prior agent a hard time, with as many opportunities as I have, is not something I choose to do. If the other agent is wrong, you take the high road, don’t get down in the mud with them. 

A happy day to all of you titans of tadpoles, you efficacious fountains of fertility, you powerfully potent performers, you mighty ruffians of reproduction. I hope you have a great day. I’m taking Sunday off myself. 

Of course, getting one past the goalie really doesn’t make a father in my book, and my own dad set the bar pretty high. He’s been gone since July 8, 1993, and there isn’t a day that goes by without my thinking of him. I still have my share of days when I ask myself what Dad would do. My father worked his way through Fordham in the Great Depression, fought in both the Second World War and Korea, raised and college educated 4 sons, one of whom nearly died at age 4, and was a devoted husband to my mom for 43 years. He always tried to do right. He cared that we’d do the same. I don’t think my father ever had a selfish moment. 

I know that fatherhood has changed me, and I have my kids to thank for that. If I weren’t a dad I’d never do half the things I do, unless I suddenly decided that I liked earning a living in a field that is full commission, fraught with rejection and stress, and as challenging as anything else I have ever done. It is just human nature to go for the low hanging fruit. And kids change that. 

I was no walk in the park for my dad. I was born when my brothers were 16, 14, and 9. Dad was 46, and Mom was 41. My 9-year old brother was sick and they were afraid that I would be also. I was not. 

So when my brothers were grown, educated, married and employed, there was my father, in his 60s and retired, running me back and forth to wrestling meets, boy scouts, school functions, and things his contemporaries considered a distant memory. My college education cost what my three brothers cost combined. 

In 1987, when I spent the summer with my brother Paul in Texas, Dad flew down and drove back with me in my $900 Datsun 510 wagon, and I remember him talking to me for much of the trip about how it was in 1945 when he returned from the South Pacific. It was a big departure from his usual self, but we had 24 hours togther, and my mother was afraid we’d kill each other. I was 20; he was 66. We made it home just fine. He wasn’t going to let me drive that far alone. I thank him for that. It was how he was- always looking out for me and not himself.  

As much as I think I challenged him, I always knew my dad loved me. 

So, to all you dads out there with your own stories to tell, have a great Father’s Day yourself. 

The majority of my listings are expired property previously listed by other brokers. On occasion, they have not collected their lockbox or sign when it is time for my own, and while I can’t typically remove their lockbox, I can put their sign on the side of the garage or in an innocuous place. There have been rare times when I have delivered the sign back to their office, but I seldom do that. I haven’t found it to be helpful in my market. 

I would NEVER take another broker’s sign and leave it face down, put it in a hard to reach place, or take it back to my office. Who wants to put a sign in their car with ground crud, sluff through woods in dress clothes to get their sign, or, worst of all, have to go to a competitor’s office to ask for their own property back? Not me. And even if I listed your old listing, I wouldn’t do that to you.

This past winter I listed a home for a client who appeared to be a reasonable sort of lady. When the weather became severe, she took it off the market temporarily (We call that TOM around here, or temporarily off market) and then disappeared. I finally reached her daughter in late March, and the property was reactivated in late April. When it expired in late May, she elected to not extend me, which was fine- anyone who complains that their agent is a bum because he didn’t sell a house in 4 weeks is welcome to move on. Nobody wins 100% of the time.  

When I went to pick up my sign and lockbox, both were gone. When I called my ex-client, she tersely informed me that since since I didn’t pick up my things right away, she had her new agent “take them away.” She also said the other agent couldn’t reach me, which I know is false because my sign has my office number and my web page address. I informed her of this rather obvious fact. 

I got a call from the other agent who was on the smarmy side. If I wanted my sign and lockbox I could pick them up at her office. Bear in mind that this agent took my sign from a rather large wooded property with a 2-car detached garage and probably a dozen harmless places to place my sign if she cared to walk 30 feet. So now I have to make a second trip and deal with who knows who at the front desk to get my own stuff back. That is actually one of the reasons I don’t deliver an old agent’s sign back to them- even if I don’t try to appear that way, it is perceived as rubbing it in.  Not a very classy way of taking the baton.

This is not the most earth shattering thing, but it is a waste of time. I am forced to devote an extra trip to getting my own sign back- not much of a professional courtesy, and wasting another professional’s time has no place these days. 

It isn’t through the house yet, but apparently some Senators or their kids haven’t closed on their new house yet and they saw that thousands of people would lose out on the stimulus tax credit if something wasn’t done. While I love to sardonically suspect self interest, I don’t care what the motivation was, because we are halfway toward an extension which will have plenty of home buyers, including my own clients, exhaling in relief.

Often, delays are not the fault of the buyer, especially in lawyer-laden New York, where some attorneys don’t mix so well with deadlines. I shouldn’t pick on attorneys (although I can’t resist), because other delays could be lax agents, short sale red tape, and mortgage issues. If passed, the extension will be for 90 days, putting the closing deadline bat September 30, 2010.

Frankly, I don’t see a reason why they only gave people 60 days from April 30th in the first place now that I think of it.

Why have a deadline at all? What’s the harm in extending the credit for anyone who was under contract on April 30, 2010?