Monday, July 10, 2017

Don't Fear the Changes!

The new changes coming down the pike for mortgage loan qualifying have some people talking. Fannie Mae and the Credit Bureaus have set out some new guidelines that will be allowing more people to qualify for a mortgage.

The credit bureaus are holding municipalities to stricter standards when reporting tax liens and judgements. This means that those individuals who have their credit affected by tax liens or judgements may no longer have those derogatory items on their credit profile. For these people that will result in higher credit scores and more ability to borrow.

Fannie Mae is allowing higher debt ratios. What this means is that portion of a person's income that is dedicated to monthly expenses (liabilities) can be higher now compared to what it was in the past. An example of this is if you gross $10,000 a month in income, the old rule said you could spend no more than $4,300 on your monthly liabilities including housing payment. Now the rule has been amended to allow $5,000 on your monthly liabilities including housing payment. The spokesperson from Fannie Mae said this was due to the large number of Americans who are subject to student loans. Sure there are other characteristics of the loan file that must be present, but this is the general idea of the recent (July 29, 2017) change.

A couple of things to note regarding these changes and why not to "fear" them. Tax liens and judgements will continue to be present if the proper identifying factors are present. This just eliminates the ones that stick on a person's credit report long after being paid or belonging to someone with a similar name (both great reasons to make this long overdue change).

For Fannie, there are numerous things that are not taken into consideration for income in a borrower's file (e.g. income from a roommate, tip income/bonus income/commission income received less than two years, etc.). So Fannie is allowing borrower's to make up the income through creativity ( because less and less people are punching W-2 clocks these days...right UBER), which is a very good thing. Sure it would be nice to see them adapt a bit better to the chainging income profile of Americans, but this is a good start.

In conclusion, there is little to fear in these changes. The major factors to be concerned about in our economy are what the "big money" is up to and whether they are continuing to invest in derivatives with little to no underlying investment. We all know where that went in 2006 and hopefully they have learned their lesson because one thing we know that is for certain - change will ensue.

We are always available for your questions/comments at

Thank you very much!

Tuesday, April 25, 2017

Closing Time - Be "Johnny on the Spot!"

Many title people, realtors and notaries are surprised to see me at closings. Apparently, a good majority of my competitors do not attend the closing of their loan files. I have always felt it is very important to be present at the closing to answer any questions that might arise and to be "present" for my customers.

Throughout my 15 years in the mortgage origination business, I have seen plenty of mishaps/errors on loan files. Conservatively, there are six people that work a loan file through the process from beginning to end. It is only reasonable to assume that occasionally the interpretation or familiarization process from one person to the next can allow typos or mistakes. The important thing is for me, the loan officer, to be the person who catches the mistake or makes things "right" - and to be at the closing table for my customer if there is any detail that seems out of order.

There are plenty of studies and surveys that will corroborate what I am saying above, but it shouldn't necessitate a survey to motivate a service provider to be "present" for their customers.

We are always available for your questions at ...or at your next loan closing!!!

Thank you!

Monday, April 17, 2017

Renovation Loans

Did you know that you can use the bank's money to make repairs/upgrades to a home you are purchasing (or refinancing)? It is truly a great way to find a "bargain" in today's real estate marketplace. Look for things like "handyman special" or "fixer upper" in the description of properties for sale. This normally will mean that a property is being listed for sale below market price because it is in need of repairs. Got questions...we are always available to answer at

Thank you!

Wednesday, March 1, 2017

Spread the WORD!

I read this morning the results of a survey conducted by the National Association of Realtors that 87% of non-homeowners believe they need 10% down or more to purchase a home. This is entirely inaccurate and I am very surprised that so many people do not know better. So for your "good deed of the day", spread the word that the minimum down payment for purchasing a home is normally around 3%. Sure, there are Jumbo loans and other circumstances that require a larger than 3% down payment. However, with the majority of loans 3% is sufficient, and in some cases a 1% down payment is available (and Veterans loans allow 0% down payment)!

The monthly payment is higher when you put less down, but the barrier to entry for most home buyers is the down payment - not monthly payment. Once you are in the game, you are normally in it to stay as your home equity will move with the market (up or down).

As always, I am excited to discuss these topics and can be found at

Thank you very much!

Friday, February 3, 2017

FHA Mortgagge Insurance Premium - Up, Down, Up

Many of you have read about the FHA mortgage insurance premium reduction being suspended by Ben Carson, the newly appointed head of The Department of Housing and Urban Development (HUD). The plan was on 1/27/17, the FHA mortgage insurance premiums were going to be reduced for the majority of the products offered by FHA. The principle reason is the insurance coffers at FHA have been replenished since paying out millions in claims as a result of the mortgage crisis. However, there was also the end result of the premium reduction that netted a lower payment for borrowers - causing a bit of concern when the reduction was suspended. All this being said, we are back at square one with FHA products.

So let me tell you where square one is:

1. A mortgage product with few pricing differences for credit scores from 500 - 850. Credit score and history is not a large factor with FHA products.
2. A mortgage product that, no matter how large your down payment, has mortgage insurance that NEVER goes away no matter your equity position over the life of the loan.
3. A mortgage product with a 1.75% upfront mortgage insurance premium ($300,000 x 1.75% = $5,250) in addition to the monthly mortgage insurance.
4. A mortgage product that will allow you to purchase a duplex, triplex, fourplex with 3.5% down payment.
5. A mortgage product that will allow you to buy a property and completely remodel/renovate down to the foundation and build additional structures (garage, ADU, etc.) with only 3.5% down payment.

The bottom line is that although there are a very few borrowers who may have been hurt by this suspense of the monthly mortgage insurance premium, FHA products are not long term products and should not be used as such. They are meant to be used the way a pole vaulter uses the pole. To get up to the place you need to be. Then once you are up to the bar (stick with me on the pole vaulting references here), you refinance out of that FHA product to a conventional product when your credit is better, your renovated home has given you equity, or your multi-family property has paid down the loan balance - and you clear the bar and perform your "fly-away" and let go of the pole (or FHA loan).

HUD is doing what it has to in order to keep this "pole" or "facilitation" product viable and if that means we stay at the higher monthly mortgage insurance premiums so creative buyers have a product, so be it. It is a good product for those who know how to use it. Also, HUD is being cautious and conservative to ensure the replenishment of the coffers is actual and sufficient - not a bad idea at all!

I am always available to discuss FHA/HUD or any real estate financing questions you might have at

Thank you very much!

Tuesday, December 27, 2016

Merry Christmas and Happy New Year!

I wanted to take a moment to wish everyone a very happy holiday season and new year. 2016 has been tumultuous and prosperous. The consumer sentiment of the economy is at a multi-year high and people are spending. The election results have many people cautious and reeling, but at the very least - they are feeling good about where the economy is heading. This reminds me of Wei-Chi where in the Chinese language the word "crisis" is composed of two characters meaning "danger" and the other "opportunity". May you find your opportunity amidst the danger in 2017. We are always looking for brainstorming and your thoughts at
Thank you!

Image result for change and opportunity chinese

Friday, November 11, 2016

Happy Veterans Day!

Thank you to all of the Veterans for your service. It is truly appreciated.

***Especially to my father who is an honorably discharged U.S. Marine flamethrower in Vietnam***

Image result for flamethrower marine vietnam

Wednesday, September 28, 2016

Our Video - Four Year Old Message, Better Results

Have you see our video? If not, take a look below. Not much has changed since we recorded with in 2012, except for increased savings and better products for our customers. Large banks have increased their fees and become less creative while First American Mortgage, PLLC has remained streamlined and more inventive. We are always happy to help at

Thank you very much!

Friday, August 26, 2016

Get Clean By Eating Clean - The Cleanse!

Last month, I went through the 21 Day Clean Eating and Workout Challenge with Kim Wilson Pollock. Here is the link to Kim's website:

It was fantastic! I can't believe the changes that my body went through and how addicted I am to sugar and wheat. About 15 years ago, I gave up smoking cigarettes and that was a radical change due to the addiction I had developed.  So over the last 15 years I've been walking around feeling so awesome that I am addiction free - not quite. Giving up sugar and wheat on Kim's cleanse gave me very similar symptoms as when I quit cigarettes. I consider myself to be very fit. This cleanse proved to me I am not as healthy as I thought - it was incredibly enlightening!

The best thing about the 21 Day Clean Eating and Workout Challenge was the camaraderie that was built between all the people doing the cleanse all over the country (Facebook and texting with accountability partners) and Kim's daily e-mails with tips and descriptions of the things we were going through. It is definitely a "challenge" and these two things made success more attainable.

I highly recommend Kim's program to anyone regardless of your fitness level. It is truly an eye opening experience into your body.

As always, I am available to discuss the cleanse or any finance matters at:

Thank you!

Tuesday, August 9, 2016

Brokers vs. Banks

Take a look at this video that pinpoints the reasons why at you simply get the best value.

Sure, there are plenty of people that would rather pay more and use a bank or credit union to originate their mortgage. I, however, do not like to pay more and always try to look for the best value. Brokers are simply the better choice.

Thank you!

Tuesday, July 26, 2016

Available Now - 1% Down Payment on Purchases!!!

We have the pleasure of offering a 1% down payment program for home purchases! There are some tremendous opportunities to be gained before rates go up and this program highlights that. This is a great option for anyone looking to buy a new home.

This program is new, so please contact us at to learn more.

Check out this video on the program!

Wednesday, July 13, 2016

S&Q's Maui

We recently went on vacation to Maui and had the most wonderful breakfasts at this little coffee, shave ice and food spot.

If you want to chat about Maui or Mortgage Finance - you can always find me at

Thursday, June 2, 2016

Are we experiencing inflation?

What do you think? Are we experiencing inflation? We know that all of the economic indicators, including equilibrium real interest rate (sometimes called the Wicksellian interest rate, after the late-nineteenth- and early twentieth-century Swedish economist Knut Wicksell) are saying that the US economy is not experiencing inflation, but do you think things generally cost more today than they did five years ago?

After reading Ben Bernanke's blog it is apparent that the CPI indicators are pointing to "no inflation". At the same time, does the Fed and Bernanke live on Fantasy Island?  Besides oil (artificially low by increased domestic production to specifically pressure the Russian economy - note the price of oil at the Crimea crisis), commodities whose price base is foreign currency, and other durable goods made overseas (primarily China - manipulated Yuan), what products or service have become less expensive? Seriously - what has?

Now, we understand that economists and the Fed are confined by economic models and indices derived from years of statistical and actuarial analysis, so sometimes they cannot call "a spade a spade". But with that in mind, do they own rental property? Do they pay property taxes or insurance premiums? Do they send their children (grandchildren) to school? Do they purchase food? Do they hire labor? Do they (or their contractors) purchase building materials? Do they travel? Do they attend entertainment venues?

As you can see, this list can go on and on. The encompassing number of goods and services that have increased substantially in price is impossible to ignore (unless you live in the Ivory Tower with Ben, Jan and the gang). The CPI numbers are manipulated to the advantage of social programs and the federal government. If they CPI reflected the actual costs of goods and services of our economy, the Social Security system would go bankrupt tomorrow due to the cost of living adjustment they would need to provide to payees...among every other cost of living adjustment paid in this economy.

Yes, those on a fixed income are being squeezed more than ever with the rising cost of everyday goods and services. Big box retailers have voluntarily increased wages for employees, but it is not enough for the Fed to realize inflation. We will look back on the period from 2010 to 2016 as a period of domestic inflation shrouded by statistics and artificially priced commodities and goods.

As always, we are available to brainstorm on financial topics at

Thank you very much!

Monday, May 16, 2016

The Best Land Purchase In History

The best land purchase in history was the Louisiana Purchase constructed and negotiated by Thomas Jefferson. He negotiated the purchase of almost the entire western half of the United States from France for $15m. Besides being one of the architects to the Constitution, this was Thomas Jefferson's greatest contribution to our country.

Below is a photo that I took while I was visiting and could not help but notice what a profound statement it is. The piece says:

"If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their Fathers conquered...I believe that banking institutions are more dangerous to our liberties than standing armies... The issuing power should be taken from the banks and restored to the people; to whom it properly belongs". TJ is one of my favorite historical figures and I would love to hear your thoughts at
Thank you!

Thursday, March 24, 2016

5 Ways to Boost Creativity

We all want to be more creative. Here are some tips on how to do so while maintaining relevant and consistent business acumen.

1. Be Diverse:  Diverse teams can be much more creative than individuals because several brains naturally  generate more ideas than a single brain. In contrast, too much or the wrong kind of diversity can hurt. To be most creative, teams should have people of differing skills, talents and backgrounds, but with similar values and motivations. Having a common goal is the key!

2. Reduce Time Pressures: Necessity is the mother of innovation, but not always under time constraints. Studies have shown that deadlines can inhibit creativity. Sure, we have all come up with magic in the 11th hour, but giving yourself more time will result in more creativity.

3. Take a Break: Relentlessly grinding away at a problem is less likely to produce a creative breakthrough than consistent effort combined with occasional breaks to rest, relax, and recharge. Engaging in exercise during breaks helps even more. Research shows people come up with more and better ideas while walking than while standing still. And don't discount meditation. The regular practice of mindfulness has been consistently connected with greater creativity.

4. Change the Scene: We can all agree that getting out of our "space" allows us to be able to step outside the problem and look from a different angle. This is the key to changing the scene. A day long idea-generating meeting can be productive, but is much more so if held off-site. Moving away from familiar surroundings creates unfamiliar thought patterns.

5. Embrace Failure: Anyone who is creative is bound to fail - it is part of the game. The key is to not punish the failure, but to reward it. Punishing failure will deter creative thinking.

Let us know what you use to stay creative. We are always available at

Thank you very much!