If you are anything like me, it takes awhile to learn something. I’m not the quickest guy around but I like to think that when I learn something, it sticks. When it came to learning about what it takes to succeed (which, by the way, is nowhere near over) I had to learn the hard way.

I have struggled with the idea of writing this down. I certainly do not want to come off as some guy that has all the answers but maybe what I relate here could help you in your career and maybe I can learn something from you. If you are already a top producer then this may be something that you don’t need to read. But if not, then something here might make sense.

I have been in some type of sales position most of my adult career. I have sold everything from welding supplies to, obviously, mortgages. For a long time I thought that the successful people were lucky and got their success from others. In the back of my mind, I was always hoping that the top producer in my company would somehow take a liking to me and help me by just handing some (or all) of their business to me and I would be all set after that. Imagine my continued disappointment when that did not happen. Maybe a new product would come along that would jump start my career and I would make millions. Again, disappointment. I learned to admire the people who seemed to make it big but I just thought that somehow they were just luckier then me. I started reading all kinds of books from the people that seemed to know how to make it big and there were some great ideas in those books but it still did not make my career take off.

So what happened? Again I am not trying to say that I am the most successful lender around but in the last few years I picked up on something my Dad told me years before. (Remember it takes me awhile to learn things.) He told me that no one will make it for you except you. None of the people that I admire and have been a success in business ever gave me a book of business that I was able to rest on. None of them ever gave me any money. They were willing to share some good ideas but unless I was willing to do the work myself, I was not going to make it. Most of these people, by the way, ever had an easy way of it either, They made it despite difficult markets and their own mistakes. You have to be confident in your abilities even if you are new to the sales. You have to be humble enough to learn from those who know how to make it in your business. You have to be open to new ideas and be innovative. Some of the most successful business people have had to completely re-invent themselves when the market changed. You have to be willing to try something, knowing it might fail. You have to be willing to offer yourself to your clients without, necessarily, expecting anything in return. You have to be willing to give back through volunteering and offering your experience to others that are willing to learn from you.

So who’s in charge here? As corny as this sounds, you are. Or if you are like me, God is, but then you are. It took me awhile to learn that but now it seems to have stuck.

By the way, rates are ridiculous right now. Maybe you can’t have the tax credit anymore but an FHA loan is as low as 4.25% and that savings will ad up to $8,000 real quick.

Posted by Mark Afman under Home | No Comments »

Posted by Mark Afman under Home & Mortgage & Mortgage Blog & Real Estate | No Comments »

Mortgage Insurance…It strikes fear in the heart of most home buyers, or at the very least it makes them angry. I have yet to have anyone say to me that they are happy that they have to pay a chunk of extra money in the house payment just because they don’t have a big down payment. Well, I can’t say that I blame them. Nobody wants to pay anything extra…especially when they really don’t understand what it does. “So Mark” they say, “You mean to tell me that I have to pay this insurance premium every month as part of my house payment to protect the LENDER in case I stop making the house payment?” Well…Yea. Doesn’t seem fair but it really is benficial.

It used to be that banks would only lend to people with a down payment of 20% or more of the purchase price of the house. As you can imagine that left out a pretty big percentage of the population. So the government came up with an idea. If the lenders would loan more then 80% of the value of a home, they would be protected from the additional risk by taking out an insurance policy that would protect them in case the loan went bad. The down side is that the premium on this insurance had to be paid by the home buyer. At first this insurance was provided by the federal government and was done through the Federal Housing Administration and is the same basic package today through FHA loans.

Later on when Fannie and Freddie came into being and were separate from FHA, they had to have some way of protecting the lenders from the possible loss of loans that were not paid back. They went to private financial companies to get the same thing and Private Mortgage Insurance (PMI) was born. PMI is provided by such companies as RMIC, AIG, and MGIC. These companies have suffered with the whole “mortgage meltdown”. You may remember that AIG was the subject of quite a bit of bad press when they needed to be bailed out but then paid out some big bonuses to some of their employees.

A few details to be aware of is that FHA MI and Conventional PMI do basically the same thing but there are a few differences. FHA MI is paid by the borrower in 2 different ways. Part of it is paid as a one time ”up front” mortgage insurance premium that is (at least right now) equal to 2.25% of the loan amount. This one time premium is allowed to be rolled into the loan. The rest of it is paid in the monthly MI premium that is equal to .55% of the loan per year and that is divided by 12. PMI does not have any “up front”portion so all of it is paid in the monthly premium. The PMI amount varies based on the risk. The more you put down and the better your credit is, the lower your PMI will be. The other difference is that FHA will charge their MI for a minimum of 5 years no matter how much money is put down. So even if someone put 20% down but needed an FHA loan, they would pay that MI for the 1st 5 years. PMI is only charged if the borrower does not have 20% or more to put down.

Another thing to be aware of with PMI companies is that since they went through the troubles of the last couple of years, most of them require that they underwrite the loan in addition to the lenders underwriting. They want to make sure that the loan is a good loan so they don’t have to pay out any insurance claims. The bottom line is that without MI or PMI, most people could not get a loan so it seems evil but it’s kind of the price you have to pay for not being able to save up a big down payment.

If you have any questions on this please feel free to contact me

Posted by Mark Afman under Home & Mortgage & Mortgage Blog & Mortgage Information | No Comments »

So now that we know what is going on with Erin Toll Glover (hint: she is not becoming a mortgage broker or an appraiser), we can concentrate on what to do this weekend. I know, I know…I usually write on Mortgage and Real Estate issues but after this week I need to think of something else. One suggestion is go to a local community theatre performance. Last night I went to see a performance of Gilbert & Sullivans “Patience” and I enjoyed every minute of it. This was a well done and funny version of one of the lesser known Gilbert & Sullivan productions. Go to www.elps.org for more info. This was so over the top sappy that it just had to hillarious and it was. Now in the spirit of full disclosure, I have tell you that I have performed 6 times with this group myself and have many good friends that are in this troupe but truly it is a good performance.

This is also the weekend of the Capitol Hill Peoples Fair in Downtown Denver at the Civic Center. Lots of good food, crafts, causes, and music performances. One of Universal Lending’s own will be the drummer performing on the main stage at 10:40am on Sunday.

One last idea. You may have seen the story of Lee Shayler on some of the local media outlets. Lee recently lost his sight due to desiease and is raising funds to benefit vision related charities by walking 1000 miles in 1000 hours. He will be finishing his heroic efforts this Saturday. Go see him cap off his 1000 miles and donate to the cause. Get more info at www.meyewalk.com

So since I just can’t help myself. Here is a little insight on appraisals. You may have heard that FHA appraisals are much tougher on properties that need some work. So if you switch to a conventional loan, you’re OK right? Not anymore. Underwriters are going to be picking apart any appraisal. If there are pictures of missing shingles, foundation cracks, or peeling paint, the underwriter will most likely condition for those kind of items to be fixed, regardless of what kind of loan if being done. There now I’m done with talking shop. Go have fun this weekend.

Posted by Mark Afman under Home & Links & Miscellaneous & Mortgage Blog | No Comments »

My wife was watching TLC this weekend and she asked if construction loans were really that tough to do. It turns out that there was one of those shows on that feature first time buyers and their trails and tribulations on finding a home. This particular episode featured a young couple that wanted to buy a home that was in the middle of a renovation but it had not been completed by the previous owner before they lost it to foreclosure. They were asking the Loan Officer about construction loans and the teaser segment said that construction loans were impossible to get. Continue Reading »