Because we broker through so many wholesale lenders, so we can often offer products that most other lenders can’t–and the fact that we can shop loans among so many wholesale lenders, and are often among their most productive originators, means that we get extremely good rates and pricing from them, often better than the pricing they give their own in-house retail originators. The end result? We can often help buyer agents to prequalify more buyers and close more purchases.

Some examples of the products that we can offer that other lenders might not have in their portfolio include:

• Extended Rate Lock (up to 360 days) mortgages.

• Jumbo financing up to $3 million

• 85% LTV financing on purchases up to $940k

• 95% LTV conventional financing up to $417k, even in “declining market” areas (we are a Radian Platinum lender and have access to MI programs that most other lenders do not have)

• A wide variety of MI options, including:

  • Monthly (aka “traditional”) MI (best for borrowers with lower available cash)

  • Upfront MI (often a better deal for borrowers w/ good credit and either available upfront cash or a seller who is willing to cover some of their costs)

  • Hybrid MI (a combination of a relatively small upfront payment and a drastically reduced monthly MI payment)

  • Lender-Paid MI or True Portfolio No-MI (the extra lender risk is baked into the rate, often resulting in a lower monthly payment than the corresponding Monthly MI option)

• Purchase/Rehab mortgages (especially useful for damaged/foreclosed properties)

• Purchase/Construction mortgages (i.e. empty lot or tear-down + construction of new property from ground up)

• Green mortgages (with incentives for energy-efficient properties)

• Extended condo approval options, including 1-week turnaround on getting condo developments FHA approved, as well as portfolio loans up to 95% that do not require FHA or Fannie Mae approval of the condo developments.

• VA veteran-to-veteran purchases (if a veteran is purchasing a property from another veteran whose current mortgage is a VA loan, we can arrange for the purchase to be handled as a refinance, saving the new owner significant costs and reducing documentation)

• Low-FICO mortgages (down to 530 FICO)

• Low-FICO High-Balance/Jumbo FHA and VA mortgages (down to 580 FICO)

• Alternative-Credit FHA mortgages (for borrowers w/o credit histories–cannot be used as replacement for exsting bad credit histories)

• Post-Short-Sale mortgages (we can qualify buyers who have a short sale on their credit history, in some cases immediately after the short sale rather than after the 4-5 year waiting period that most lenders require)

• Loans for non-citizens (including holders of non-traditional visas)

• Interest-Only mortgages (which do actually still have a valid use for certain buyers)

• “Fast Track” underwriting (underwriting in as little as 8 hours in some cases; Federal regulations (MDIA and HVCC) can add 9-21 days before closing, but thorough preapprovals to get the clock started early can reduce the contract-to-close period to as little as 2-4 business days if necessary)

• “Guaranteed Financing” Pre-approvals (not a single buyer that we have preapproved for financing has not been able to obtain the specified financing–EVER)

• Buyer Incubation (if you have buyers who are months or years away from being ready to purchase, we can help them make sure they are on the right track financially, and then stay in touch with them for you to make sure that they come back to you when they are ready to move forward–we’ve helped agents incubate potential clients for years if necessary)

If you have any questions about any of those programs and how your buyers might be able to make use of them, please feel free to contact us and we’d be glad to show you how we can help you get more buyers to closing faster than ever before.

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To make it easy to browse, I try to tag the titles of each event with the location, as well as ($) for events that cost money, (CE) and/or (PL) for events that offer Continuing Education or Post-Licensing credits, and (Multi-Day) for events that extend over multiple days.

If you know of a local networking or training event that you’d like to include on this list, contact us to have it added to the calendar; we’re happy to include opportunities from any local company, be they brokerages, title companies, mortgage lenders, etc. (It’s much easier for us to copy & paste info into the calendar if you provide it in text format; event invites that are sent purely as JPG images (as some CRM programs such as Constant Contact do by default) will end up having minimal info included here other than just a link to the image in question).

For the more technically-minded who might want to subscribe to this info in their own calendar program, here are links to the calendar data in other formats:

Google HTML view

XML

ICS/iCal

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The first change is a simple one that every agent should be taking advantage of–you can now (finally) brand the web pages pulled up by consumers (via Matrix links in your emails) w/ custom header & footer, rather than relying on the tiny “Courtesy of Agent Bob” header that those pages used to feature. MRIS has a fair number of not-bad templates for you to use, so even if you don’t have any time to come up with a custom header, you should at least activate one of the templates (by logging in to Matrix, and going to “My Matrix”, then “Settings”, then “Header/Footer”).

The second change is a new set of features that changes how consumers can opt in/out of receiving emails from agents sent via Matrix. Basically, Matrix as a whole was getting blacklisted by major email providers such as AOL and Gmail were getting complaints from consumers about unwanted Matrix emails; there’s now a system in place that will explain to users why they are receiving the Matrix emails, and giving them the option of opting out of receiving those particular emails for that search or all emails from that particular agent, as well as the old option of unsubscribing from all Matrix emails altogether. MRIS has some good documentation on the new anti-spam features, or for those of you who don’t like to read (or for brokers who want to include a quick training piece during an office meeting), a nice short video reviewing the changes.

The third change is the introduction of “Email+”, MRIS’ new system for emailing listings to clients (including both automatic emails as well as manual emails of individual listings). Email+ basically turns the Matrix auto-email system into a mini-IDX solution, by allowing users to sort/filter the listings that you send them, and keep lists of which properties they are most/least interested in. It doesn’t allow them to search for properties directly, so it’s not a full replacement for a separate paid IDX solution, but for agents who don’t get a lot of leads from including search options on their website, they might be able to save some money by switching to using the Email+ system and getting rid of their IDX service. MRIS again has some nice docs explaining most of the changes, including a general overview and an FAQ, as well as another quick video overview.

Email+ is really very nice, making the listings much more user-friendly to consumers (and also giving you the ability to see which properties they are most interested in) but there are two important changes that you should be aware of, as they can cause a lot of confusion and trouble if you aren’t careful:

1. First, note that the new sorting/saving/filtering features are all based on the email address that the link is emailed to, and are linked across all saved searches for that email address. That means that if you have a search set up to come to you first, and then you forward the link to your client, then when the client clicks on that link, they get access to all of the saved searches that go to you, as well as any properties that you have tagged via the Email+ system. This also means that if you have a saved search that you manually forward to multiple consumers who don’t know each other, then all of those consumers have to share their settings, saved properties lists, etc.. As an example, I have a saved search that I use to email me properties that might be of interest to various investors, and then when I see properties in those lists that are of interest to specific investors, I would previously just forward that email to the investor in question. Now, however, that would give all of those investors access to all of my other personal saved searches, as well as confusing them when other investors save/discard properties, so I instead have to go back to Matrix and manually send an email from there directly to that investor. I’ve spoken to MRIS about this, and they say that it’s intentional–in their opinion, agents should only ever be sending listings directly to individual consumers, and should never need to pre-screen listings before emailing them out. If you, like me, disagree, please email MRIS and ask for them to include an option to select the default display for individual searches.

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Good agents know that the best way to get a property sold quickly in a buyer’s market like the one we currently have in many parts of the DC area is to make sure it shows well, and then price it aggressively; properties that come on the market with aggressive pricing and that show well are actually more likely to get multiple offers and be bid UP in price rather than having to negotiate down in price. (My general rule of thumb is that in a buyer’s market, if you want to sell your property quickly, you need to be in the best slice of the market in terms of quality, AND the best slice of the market in terms of price, where the number of slices is the number of months of inventory; for example, if your listing is in a market with 8 months of inventory, then you will need to be in the top 1/8th of that market in terms of how well the listing shows AND in the lowest 1/8th of that market in terms of price, or else you stand a good chance of having that listing sit unsold for an extended period of time.)

Agents also know that many owners don’t want to start off pricing their property as aggressively as they might otherwise, which usually results in the seller having to lower their price, either directly or during negotiations. For agents who have clients like that, though, all is not lost; Seller-Assisted Financing is a great tool that can help get those properties sold faster (although not as fast as if they were priced aggressively to begin with), while also generating more leads for you and netting a higher total profit for your seller than they might get if they negotiated down in price at a later date.

What’s Seller-Assisted Financing (or SAF)? At its core, it comes down to your seller agreeing to “buy down” the interest rate for their buyer rather than lowering their price. How it works is probably best explained by an example.

According to MRIS, for example, in Alexandria in June of 2009, the typical listing sold for 95% of the listing price at the time that negotiations began. (That is, the typical seller in Alexandria was conceding 5% of their asking price during negotiations, over and above any price reductions that they had already made previously.) The average listing price of properties that sold during that time was just under $478k, meaning the typical seller in Alexandria was agreeing to a price roughly $24k below their listing price.

What did that $24k discount mean to a typical buyer and seller, though? Let’s assume for now that this was a buyer putting 20% down on that purchase, with good credit, income, and assets; a typical rate during much of June for that buyer would have been 5.500% on a 30-year fixed-rate mortgage.

For that scenario, if the buyer had agreed to the seller’s asking price of $478k, they would have ended up with a monthly PI payment of $2171.23/mo.

By negotiating the seller down from $478k to $454k, the buyer would have ended up with a monthly PI payment of $2062.21/mo–a monthly savings of $109.02/mo. to the buyer, and a loss of $24k to the seller.

Now consider the SAF option. What if, when that buyer submitted an offer at $454k, the seller had responded “how about we keep the price at $478k, but I pay to bring your interest rate down to 4.25%”? If the buyer had agreed to that counter-offer (and it would have been in their best interests to do so once the seller’s agent had gone over the math with them), here’s how things would have played out. With that lower interest rate, the buyer’s monthly PI payment even with the higher sales price would have been much lower, at $1881.18/mo–$290.05/mo lower than the original payment, and $81.03/mo lower than their payment would have been if they had lopped $24k off of the price, instead! And the seller wins, too–because the cost of buying down the buyer’s rate by 1.25% for that scenario would have been about $14k, meaning the seller nets an extra $10k in profit vs. having agreed to a price reduction of $24k, while also giving the buyer a better monthly payment than the $24k reduction would have given them.

SAF also helps more buyers qualify for the property in the first place: for the “$24k off” scenario above, a typical lender would probably want the buyer to earn at least $80k/yr in income, while in the SAF scenario, the borrower would be able to qualify with an annual income of around $7k less. More potential buyers means a faster sale, and the effect on qualifying ratios is even more pronounced when looking at high-end properties–in one scenario a loan officer I know was running for a client recently, SAF on a $2.2 million property reduced the minimum annual income for potential buyers by nearly $100k/yr while netting the seller more profit and reducing the buyer’s monthly payments.

Agents benefit from having SAF listings, too, and not just in getting their listings sold faster.

For one thing, since many agents’ commissions are based on the final sales price of the property, SAF can help agents earn higher commissions. (Note that we don’t endorse agents negotiating deals for their sellers that will increase the agent’s commission by reducing the seller’s net profits; increasing your own commission by increasing your client’s profit, though, is exactly the aligning of interests that commission-based work is supposed to engender.)

And, last but not least, SAF listings can be used to generate more buyer leads than other listings do. Years of late-night infomercials and “get rich by investing in real estate” books have trained a generation of buyers to look for sellers who will provide financing to buyers directly (either by giving the buyer a loan, or letting the buyer assume an existing mortgage loan), because (especially in the now-long-gone days of easily-assumable mortgages) those sellers were often the best deals for buyers (especially investors). True seller financing is very rare these days–but in my experience, listings that offer “Seller-Assisted Financing” tend to trigger that same “it must be a good deal” center in buyers’ brains; ads for properties featuring SAF in online media like Craigslist in particular tend to get a lot more buyer calls than ones that don’t have that language.

Want to know more about how to use Seller-Assisted Financing to help your sellers and yourself? Drop us a line and we’d be glad to go over your listing inventory with you to see which properties might be most amenable to using SAF, and even help you prepare marketing pieces for them.

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In Virginia, the law requires that before digging any holes, the Division of Underground Utility and Railroad Safety of the Virginia State Corporation Commission (aka Miss Utility of Virginia) needs to be contacted to make sure that utility lines such as gas lines are not in the digging area; DC & Maryland also have their own Miss Utility. I’ve always made sure to call Miss Utility before ordering a sign installation for any of my listings, but apparently I’ve been in the minority, so the Virginia SCC recently started a campaign to educate agents about their responsibilities; they’ve also kicked off an enforcement campaign, and violators are liable to be fined up to $2500 per instance discovered of installation of a sign without proper pre-installation calls. In response, the VREB has started their own campaign to remind agents of what they should have been doing all along.

(Note that in response to requests from VAR, the Virginia SCC did clarify on July 13th, 2009, that hand-installed wire signs such as open house directionals do not require calls to Miss Utility, and VAR counsel Lem Marshall indicated that he believes that this exemption is probably limited to wire signs that are “about the diameter of a large metal coat hanger“, rather than the larger L-shaped metal signs that some agents use. I have heard some agents claim that there is also an exemption for larger hand-installed signs installed by the homeowner themselves rather than by their agent, but the VAR/SCC clarification doesn’t mention that, and to the best of my knowledge Miss Utility has never had different standards for homeowner’s vs. people who work for them. Similarly, there are no exemptions to the best of my knowledge based on how far the sign does or does not extend underground.)

So make sure to call Miss Utility (or confirm that your sign installation company calls for you) before having a sign put in your client’s front yard: not only will you avoid potentially being fined, but you also won’t have to have that unfortunate conversation with your client where you explain why you can’t sell their house for them after all, what with that house having been blown up when the post-hole digger cracked a gas line.

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Chip is generally a pretty good trainer, so it will probably be an informative session; like with most free real estate coaching/training, though, there will almost definitely also be a fair amount of not-so-subtle sales pitches for other for-pay training or services that he offers.

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EEMs are mortgages that allow a purchaser roll the costs of certain green renovations into their purchase loan, over and above the loan amount that is needed to actually purchase the property. The size of the allowable renovations is based on the amount of energy that the greenovations are expected to save over the long run; this webinar hosted by HUD & FHA explains how to obtain the “present value of the energy saved”, calculating the increased dollar amounts allowed for energy efficient packages. This training course is intended to provide Realtors, home counselors, & lenders with added value for their services in a highly competitive market.

Registration on HUD’s website is required.

(EEMs are one of the many green mortgage solutions that Ethical Homes and the myEnergyLoan team offer consumers; if you’re interested in learning more about those green mortgage options, feel free to ask.)

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The Sarasota (FL) Herald-Tribune began investigating reports back in November 2008 of owners of new-construction homes who were being plagued by repeated failures of their HVAC systems, the copper coils of which were quickly becoming black and pitted no matter how often they were replaced; their excellent and ongoing investigation eventually led to the conclusion that the problem lay with gases being released by defective drywall that was imported from China in response to local shortages during the housing boom of the last decade. While there are no confirmed cases of this drywall having been used in the DC area yet, it’s important for agents to be aware that in coming years, these reports are likely to crop up in homes that agents will be listing or helping buyers to purchase.

In the video below, Dr. David Krause (state toxicologist from the Florida Department of Health) discusses what is now being referred to as “Chinese drywall” with a group of Realtors in Florida; the pictures he shows comparing HVAC systems of normal homes (at 7:30 and 8:48 into the video) and homes with Chinese drywall (at 7:58 and 9:04 in the video) are striking:

As he notes, this sort of corrosion keeps recurring no matter how many times the HVAC systems were replaced–in some cases owners have had to replace systems as many as a dozen times in one year–and this corrosion is occurring on any copper (or to a lesser extent brass) in the affected homes, including appliances and computers as well as (much more dangerously) smoke detectors and brass natural gas fittings. In addition to the now-confirmed connection with metal corrosion, Chinese drywall is also reported to have caused health issues such as headaches, nosebleeds, and trouble breathing, although it’s worth noting that there is no scientific proof as yet for the connection between Chinese drywall and those reported symptoms.

The Herald-Tribune has a map (PDF) showing the states where Chinese drywall is known to have been imported; the largest importer by far was Florida, and DC, Virginia, and MD are not among the states where Chinese drywall is known to have been imported, but neighboring states such as North Carolina and Pennsylvania were importers, so it’s not unreasonable to believe that at least some of the affected drywall was used in the DC/MD/VA area. That map gives estimates of the number of affected homes, but those numbers are best-case scenarios, based on dividing the amount of imported Chinese drywall by the average amount of drywall used in a home; as Dr. Krause points out, though, the affected drywall is mainly 1/2″ drywall, which is only one size of drywall used in homes, and there are reports of Chinese drywall being used in remodeling projects in addition to in new construction, meaning it’s use is probably more widespread than initially thought–by some estimates, the number of affected homes could be up to 100 times as large as the Herald-Tribune’s numbers.

Again, there are no confirmed cases of Chinese drywall in the DC as of yet; depending on how widespread the product turns out to be, though, this could become a large issue that agents should be aware of, as the potential liability issues combine potential health risks (similar to radon and asbestos issues that agents already deal with) as well as product failure issues (similar to polybutylene and EIFS issues).

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A few agents asked us to start sending out updates, so we took a quick poll of our readers:

Note: There is a poll embedded within this post, please visit the site to participate in this post's poll.

Given the strong response, we went ahead and created the newsletter; the first edition got good feedback, so we’re continuing it and opening subscription up to any interested agents. To sign up, just use the form below:

We’re going to try this with weekly updates (on Mondays, since some brokers have said that they are using our info in their Tuesday office meetings), and see how things go; schedules may require scaling them back to monthly, though, so if you do find them useful, please let us know.

Also, since the entire point of this is to share information between agents: if you read a good article or learn about some other good information that is directly relevant to agents, please let us know about that as well, so we can share it with others.

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MDIA is designed to help eliminate one of the most common complaints about mortgages–the fact that mortgage lenders historically haven’t had to actually commit to the specific terms of a loan that they are offering a borrower; thanks to the Truth In Lending Act (TILA), they did have to disclose estimated numbers to borrowers, but those estimates weren’t binding, allowing unscrupulous (or just inept) lenders to send the borrower initial estimates that ended up being vastly different from the final numbers that the borrower would be confronted with at the settlement table, at which point it was often too late to re-negotiate the terms of the loan without pushing settlement back (and as a result potentially suffering legal or financial consequences).

MDIA modifies TILA to turn the estimates that lenders give borrowers into binding commitments, and requires updated versions of those estimates to be sent to the borrowers if the terms of the loan in question change by more than a set amount–specifically, if the APR for that loan (which reflects both the interest rate on the loan as well as any costs associated with the loan) changes by more than 1/8 of a percentage point. If an updated version is required to be sent out, then the loan cannot go to settlement until the borrower has had 3 days to review the updated version, and borrowers are not (under most circumstances) allowed to waive that 3 day review period, even if they want to do so.

There are three big problems with MDIA, however:

1. It requires redisclosure (and the resulting waiting period) even if the terms of the loan get better. Under the old version of TILA, an ethical mortgage loan officer’s initial disclosure to a borrower of the terms of the mortgage would use worst case numbers; that way, if the borrower were comfortable with those numbers, then the only surprise that the borrower would get on settlement day would be if they ended up having to pay less and/or having a better rate than they had thought because the final details ended up not falling into that worst case scenario. Under MDIA, on the other hand, if market rates improve and a lender is able to actually reduce their borrower’s rate and/or fees, the lender would still have to redisclose, and if that happened within 3 days of the scheduled settlement, then settlement would automatically have to be pushed back.
2. It doesn’t distinguish between mortgage brokers, direct lenders, and the loan officers who work them, so it’s not clear from whom the redisclosures have to come in order to satisfy the new regulation. We currently work with 71 lenders, and there’s no consensus among them on whether a redisclosure from the loan officer to the borrower would suffice, or if the lender who is actually funding the loan would have to provide the redisclosure directly. Most funding lenders are currently only set up to issue official documents for a loan as part of sending their “clear-to-close” authorization to the settlement company indicating that the loan has been fully approved and the funds are ready to be wired to the settlement company; funding lenders currently often don’t reach that point until the day before or even the same day as the one on which settlement is scheduled to take place, so if the lenders conclude that they need to issue the redisclosures directly, they will either need to put in place new systems to handle those redisclosures (which could potentially take months for them to do), or else their “clear-to-close” authorizations will effectively become “clear-to-close-in-three-days” authorizations.
3. In addition to the 3-day redisclosure period, it also requires that the borrower have 7 days to review their initial disclosure before settlement. This means that for many purchases involving a mortgage after 7/30/09, 7 days becomes the de facto minimum time between contract and closing. (Most lenders underwriting times are long enough that the 7 day period won’t be the bottleneck, though, and motivated buyers should be getting at least some form of pre-approval before submitting an offer, in which case the initial disclosure can often be done at that time and then a re-disclosure done w/ the 3-day period once the contract is ratified.)

We strongly recommend that, especially during the next month or two as lenders try to work out the details of how they are going to handle compliance with these new regulations, agents coordinate very closely with their lender partners to find out how they are handling the situation, and try to include at least a few days of “wiggle room” in your closing timetables in case settlement does need to be delayed as a result of these new requirements.

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