TNR - February 2008 by The Niche Report

Issue 008 February 2008 TheNicheReport.com

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The Challenge to Change Understanding unsecured business lines of credit.

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Time 16 It's to Embrace

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CONTENTS

Issue 008

February 2008

It's Time To Embrace Change

NICHE REPORTS PRIME

pg 39

ALTâ&#x20AC;&#x201C;A

pg 39

NONPRIME

pg 40

HARD MONEY

pg 41

COMMERCIAL

pg 42

CONSTRUCTION

pg 44

Become a trusted advisor MICHAEL SALDUTTI Owner and Founder of Royal Bay Mortage, Inc., the Wealth for Life University and Strategic Equity Managment Group

FOUNDER & PRESIDENT Robert Pegg robert@nichereportonline.com

The Challenge to Change mitchell chapman executive director of national business finance Understanding unsecured business lines of credit.

21 24

Co-Op Lending

Mastering the Power of Two

MI is Tax-Deductible Through 2010 MGIC mortgage guaranty insurance corp. Answers to commonly asked questions.

February 2008

Center Stage with a la mode the niche report A candid conversation with Brad Eaton, VP Mortgage Products.

julie teitel senior loan officer at new york mortgage / indymac bank What you need to know.

tom ninness president of summit champions A lender's point of view.

Tip of the Month STEWART MEDNICK MORTGAGE BANKER AND REVERSE MORTGAGE SPECIALIST AT AMERICAN MORTGAGE CORPORATION Should I stay or should I go?

DEPARTMENTS

09 10 12 45

CO-FOUNDER & PRESIDENT David Pegg david@nichereportonline.com EDITORIAL/CONTENT MANAGER Kristen Moser kristen@nichereportonline.com ACCOUNTING MANAGER Shawna Ingram shawna@nichereportonline.com SALES MANAGERS Jason T. Buff jason@nichereportonline.com Kim Campos kimcampos@nichereportonline.com DESIGN Plumbline Studios, Inc. Eric Ball PRINTER / CIRCULATION MANAGER The Ovid Bell Press, Inc.

NOTE FROM THE FOUNDER CALENDAR OF EVENTS LETTER TO THE EDITOR LENDER & RESOURCE DIRECTORY

CONTRIBUTING AUTHORS Mitch Chapman Stewart Mednick MGIC Tom Ninness Michael Saldutti Julie Teitel

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Published monthly by BODA Publishing, LLC 6016 Alderdale Place, Haymarket, VA 20169 Phone: 540.657.2632 Fax: 703.991.2362 Email: info@nichereportonline.com www.TheNicheReport.com

SUBSCRIPTIONS This publication is intended for real estate finance professionals. If you are a mortgage broker, lender, loan officer and you do not currently receive The Niche Report, please send your name, company name, and address to subscriptions@nichereportonline.com. To opt-out of receiving The Niche Report, please send your request, including name, company name, and address to opt-out@nichereportonline.com.

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To inquire about advertising in The Niche Report, please call 540.657.2632, or send an email to ads@nichereportonline.com. Visit our website, www.TheNicheReport.com to download a copy of our Media Kit.

EDITORIALS / ARTICLES To submit an article for consideration in The Niche Report, please send an email to kristen@nichereportonline.com or call 540.657.2632. We are interested in original writings relevant to mortgage brokers and other real estate finance professionals. If you have a comment or question about an article or editorial published in The Niche Report, or if you have a suggestion for a topic you would like to see featured in a future issue, please send an email to kristen@nichereportonline.com.

THE NICHE REPORT POLICY The information and opinions expressed by contributing authors and advertisers within The Niche Report do not necessarily reflect those of BODA Publishing, LLC employees and should not be considered as endorsed or recommended by BODA Publishing, LLC.

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NOTE FROM THE FOUNDER

So January turned out to be a very eventful month for the mortgage industry with the news that Bank of America is acquiring Countrywide. Some predicted this would happen, and from my point of view, it became clear that Bank of America shut down its wholesale division, leaving just its retail channel open, with the intention of acquiring Countrywide to serve the wholesale channel. But I guess we’ll see how that plays out after the deal is sealed. On to Niche Report news, we have a few things to mention. As you may know, The Niche Report expanded into California with January’s issue. We have been warmly received by many from the Golden State, so thank you for your kind phone calls and emails. With this February issue, we are proud to announce our continued western expansion into the state of Washington. Although this growth wasn’t initially planned for February, we decided to take the advice and encouragement from several of our supporters and increase our distribution for the second month in a row. We are very happy to meet the needs of lenders and loan originators serving Washington’s homeowners. In addition, you’ll notice a couple of changes to the magazine in this issue. First, we’ve changed the look of our Niche Reports. Prior to this issue, the lending categories were each color-coded. But we think we’ve found a way to make the Reports even better and more useful for you. Each lending category is now distinguished by a symbol that signifies each category (e.g. a hammer and wrench for the Construction page). Second, our new monthly company Q&A will now be called “Center Stage”. So check out this month’s Center Stage with a la mode on page 32. Finally, we’ve added a Letter to the Editor feature. This section of The Niche Report will be dedicated to readers’ opinions, viewpoints, and responses to anything we have published in previous issues. We encourage you to send us your opinions, thoughts, and suggestions for The Niche Report or for anything mortgage-related. Give us a shout at info@nichereportonline.com.

Robert Pegg Founder & Publisher

TheNicheReport.com

CALENDAR OF EVENTS

Upcoming Key Dates & Events: FEBRUARY – March =<9IL8IP )''/ J D K N

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February 14 4th Qtr. Metro Home Prices / State Resales released by the NAR.

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February 3 CREF / Multifamily Housing Convention & Expo, Orlando, FL. Visit www.mbaa.org for details.

February 4 CREF / Multifamily Housing Convention & Expo, Orlando, FL. Visit www.mbaa.org for details.

February 5 CREF / Multifamily Housing Convention & Expo, Orlando, FL. Visit www.mbaa.org for details.

Housing Forecast / Pending Home Sales Index released by the NAR.

Commercial Lending Indicator released by the NAR.

February 25 January Existing – Home Sales released by the NAR.

February 26 California Association of Mortgage Brokers (CAMB) 2008 Sales & Marketing Conference, Anaheim, CA. Visit www.cambweb.org for details.

February 27

Marketing Conference, Anaheim, CA. Visit www.cambweb.org for details.

MARCH 6 Housing Forecast / Pending Home Sales Index released by the NAR.

MARch 11 Maryland Association of Mortgage Brokers (MAMB) Conference & Exposition, Baltimore Convention Center. Visit www.mamb.org for details.

march 12 Maryland Association of Mortgage Brokers (MAMB) Conference & Exposition, Baltimore Convention Center. Visit www.mamb.org for details.

march 24 February Existing – Home Sales released by the NAR.

California Association of Mortgage Brokers (CAMB) 2008 Sales & Marketing Conference, Anaheim, CA. Visit www.cambweb.org for details.

February 28 California Association of Mortgage Brokers (CAMB) 2008 Sales & Marketing Conference, Anaheim, CA. Visit www.cambweb.org for details.

WHAT'S YOUR NICHE? Advertise it monthly in The Niche Report. info@nichereportonline.com www.thenichereport.com

February 6

February 29

CREF / Multifamily Housing Convention & Expo, Orlando, FL. Visit www.mbaa.org for details.

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LETTER TO THE EDITOR

Let’s compare that to the DRE:

LETTER TO THE EDITOR

1.) The DRE Licensees are only audited if there is a complaint or if they maintain a trust account. 2.) The education and testing requirements to obtain a DRE license do little to prepare prospective licensees for the mortgage business from a practical standpoint. 3.) There is no net worth requirement. 4.) There is no bonding requirement. 5.) As independent contractors the Broker has less control over his agents than the employees of a CFL lender. For these reasons, I believe mortgage lending supervision should be taken away from the DRE, which should focus on regulating real estate transactions, and put into the hands of the Department of Corporations using the CFL and CRMLA standards, without any exclusions concerning banks and savings and loans.

Dear Editor, I read “What Next?” by Phil Hawkins (January 2008 issue). While he is entitled to his opinion about the Consumer Finance Lender’s License, and the causes of this lending crisis, I think his assumptions are flawed and inaccurate. Since he works for an institution with a Federal Charter I would not expect him to speak from experience outside of that domain, however, he should get his facts straight. As both a DRE lender and CFL lender I can tell you that in my opinion DRE brokers should have to get CFL licenses if they want to broker loans for the following reasons: 1.) CFL Lenders are audited every year. 2.) CFL Lenders are required to train their employees. 3.) CFL Lenders at least have to establish a $25,000 net worth. 4.) CFL Lenders must carry a $25,000 Surety Bond.

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THE CHALLENGE TO CHANGE Understanding unsecured business lines of credit. BY MITCHELL CHAPMAN

or the past several months the mortgage industry as a whole has become somewhat of a ‘gloom and doom’ industry. Each day as we read the financial news we learn of another major mortgage lender closing their doors and or suspending their loan pipeline. Their once bread and butter products and programs, how we made our living, have now become ancient relics and part of ‘the good old days’. With adversity comes the opportunity for prosperity. One income opportunity lies in the area of Unsecured Business Lines Of Credit [UBLOC]. However, it requires a totally different mind set from that of the traditional mortgage broker and loan officer. With that comes the challenge to change. Whether it is to meet seasonal inventory demands, remodel your office space, or any other short-term financial need, an unsecured business line of credit is an excellent way to have extra funds available to your business when you need them. Not unlike a credit card, an unsecured business line of credit can provide you with the necessary funds to complete a project or make it through a cash flow crunch. Based on the funds you use, you pay interest on the outstanding monthly balance only. Many new business owners use personal lines of credit in order to finance their companies when starting out. However, once the business has made it through the initial growth phase, it is advantageous to apply for an unsecured business line of credit. While an unsecured business line of credit will have more stringent qualifications than a mortgage and can perhaps be more difficult to obtain than personal lines of credit, once you

have one, you will leverage your buying and borrowing power. Unsecured business lines of credit vary in how they are set up. For example, some lenders will require tax returns and business financials, regardless of the amount sought. However, some lenders do not have this requirement and their process is application only. Such credit lines can also be based on receivables and, in some cases, inventory (although this is less common since the value of inventory can decline very quickly and is therefore seen as a greater risk to the lender). The interest rate can also differ, since commercial rates may be equal to or exceed the prime lending rate (also based on the level of risk as perceived by the lender). Therefore, it is advisable to shop around. While seeking an unsecured business line of credit, you will also want to know that the interest being paid is only on the money being borrowed, as opposed to being calculated on your borrowing limit or in any other manner. Also, some lenders provide special interest rates for a limited time frame such as PRIME minus 1 for the first 6 months. An unsecured business line of credit can allow you to always have the funding available that you need and give you peace of mind as a business owner.

60-Second Guide to Establishing an Unsecured Business Line of Credit [UBLOC] For financing flexibility, nothing beats an Unsecured Business Line of Credit [UBLOC]. Structured very similarly to your personal credit cards, UBLOCs allow the principals of approved 2 plus year old business to borrow and to use only as much money as is needed, up to the established UBLOC limit, to stay on top of seasonal and business cycle fluctuations. Application and repayment requirements are generally far simpler than

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term loans and other common financing options. However, an UBLOC is by no means a panacea for a small business, nor is it entirely free of requirements and risks. In just 60 seconds, we’ll show you how to determine if an UBLOC is right for you.

0:54 What Do You Need and Why? An UBLOC is suitable for temporary, short-term needs such as covering cash flow, purchasing supplies and inventory, and financing receivables. For larger, longterm investments such as new facilities, equipment and other fixed assets, a conventional business loan or other financing mechanism may be more appropriate. 0:48 Shop Around Procedures to qualify for, use and repay an UBLOC vary among lenders. Nearly all will charge fees for start-up, transactions and annual use and will require personal credit scores of 660 plus for each bureau with no lates, liens, judgments, collections or bankruptcy. However, there are no annual reviews of how you’re using your UBLOC.

leaving those funds available for true emergencies.

0:06 Cash In on Experience Assistance with UBLOCs and other forms of business financing is always available from National Business Finance. Experienced counselors can help you through every step from needs assessment to applications and money management. These services are an ideal investment in the future of your small business. Mitchell Chapman is the Executive Director of National Business Finance, who provides alternative financial solutions for small businesses. National Business Finance specializes in providing unsecured working capital, 100% NO DOC commercial mortgages as well as residential and commercial construction financing. He can be reached by telephone: 954-495-4791; fax 954-793-4411; or via e-mail at: info@nationalbusinessfinance.com. You can also browse online at: www.nationalbusinessfinance.com

0:35 Consider the Costs An UBLOC offers the same convenience as credit cards do, and many of the same risks. You must manage these funds wisely to make sure you don’t abuse them. Unlike loans, interest rates on an UBLOC may vary with the market, your balance and other factors. The interest rates are generally in the range between the PRIME rate and PRIME plus 4. Sometimes they can be higher. 0:27 Line Up Your Qualifications Your application for an UBLOC will not require a business plan, tax returns or business financials. The process is application only on a stated income and stated asset basis up to $50,000 per lender. Amounts over $50,000 per lender will require full documentation to include the last 2 years personal and business tax returns as well as the last 2 years business financial statements. 0:14 Build-in Sound Budgeting Just because you qualify for an UBLOC doesn’t mean you have to use it. Good business planning, financial management and operational skills can help you minimize the need for an UBLOC (and, accordingly, your debt),

TheNicheReport.com

It's Time to Embrace Change. Become a trusted advisor.

BY MICHAEL SALDUTTI

ith the news hitting us almost daily wherever we turn regarding foreclosures, an alarming trend keeps popping out: most of the foreclosures are due to ARM’s adjusting to levels beyond that of which homeowners can afford, loans categorized as Stated Income and No Doc and of course everyone’s scourge - the NegAm Option ARMS. In April 2005, Alan Greenspan stated the following, “"Innovation has brought about a multitude of new products, such as sub prime loans and niche credit programs for immigrants. Such developments are representative of the market responses that have driven the financial services industry throughout the history of our country… With these advances in technology lenders have taken advantage of credit-scoring models and other techniques for efficiently extending credit to a broader spectrum of consumers.… Where once more-marginal applicants would simply have been denied credit, lenders are now able to quite efficiently judge the risk posed by individual applicants and to price that risk appropriately. These improvements have led to rapid growth in subprime mortgage lending; indeed, today subprime mortgages account for roughly 10 percent of the number of all mortgages outstanding, up from just 1 or 2 percent in the early 1990s." Wow. Do you think New Century, Fremont, Fieldstone, etc.,

would agree today that they were “able to quite efficiently judge the risk posed?” "It was the Federal Reserveengineered decline in rates that inflated the housing bubble … the most troublesome aspect of the price run-up is that many recent buyers are squeezing into houses that they can barely afford by taking advantage of the lower rates available from adjustable-rate mortgages. That leaves them fully exposed to rising rates." —Business Week, July 19, 2004, Is A Housing Bubble About To Burst? Let’s further review some of the most damaging past history: In August 2004, Greenspan suggested that "the Fed will err on the side of sustainable growth for now, over inflation”. That still likely means a series of quarter point hikes through year-end, with a brief pause for national elections in November." Feb 16, 2005 – semiannual monetary policy testimony before the Senate Banking Committee:

STILL ACCOMMODATIVE. Indeed, the Fed sage spelled it out accordingly: "The cumulative removal of policy accommodation to date has significantly raised measures of the real federal funds rate, but by most measures, it remains fairly low." In other words, policy still remains accommodative, and the process of normalization will continue until the Fed funds target rate, currently at 2.5%, likely enters a 3% to 5% range often regarded as neutral territory. YIELD CURVE "CONUNDRUM." From the bond market's

perspective, perhaps the testimony's most compelling portion was Greenspan's devotion of nearly a full page of the written report to addressing the "conundrum" of global yield curve flattening -- the shrinking spread between long- and short-term rates. He inferred that all else being equal, the flattening of the yield curve at a time of monetary policy tightening was defying "simple mathematics" in which longer-term rates typically adjust accordingly to changes in short-term rates. It needs to be noted that a flattening and ultimately inverted yield curve is not normal and would not be sustained as a correction would be in order at some point in time. With this being the case, and the fact that at the time Greenspan was quite adamant that the Fed had a target rate of somewhere approaching 5%, wouldn’t the prudent person realize that future long-term rates had to go higher? If so, someone needs to explain the incredible and almost mind-boggling level of adjustable rate mortgages that closed during this period of time. Our industry was putting our clients into 2 and 3 year ARMS, most with prepayment penalties and into NegAm Option ARMs. This is incredibly alarming that as licensed professionals our industry did not adopt conservative and prudent lending practices based on the most evident of facts concerning the movement of rates. I have nothing against ARM’s or the NegAm’s. When utilized properly, they are wonderful financial tools especially for those of us who extol the virtues of TheNicheReport.com

placing clients in mortgages that have the greatest impact on their overall debt management and wealth accumulation goals. They were NOT designed to put Mary and Joe Homebuyer into them only for the sake of “up selling”. I am not suggesting that our industry be full of economic experts and soothsayers, but there is a point where we must demand of our professionals a certain minimal knowledge and understanding of the affects that the economy and monetary policy play in regard to loan programs. Our industry allowed too many painters, contractors, cashiers, etc., enter into our line of work during the boom times for the sake of “cashing in”. However, I think they were only a small percentage of the problem. But nonetheless, it is alarming that our industry allows such an easy access to entry. Our industry is still wrought with individuals who do not understand the most basic economic and monetary policies and how they impact our daily decisions when sitting with a client and offering financing. Realtors are required to pass two 40 hour classes before they can sit for their real estate exam. Why don’t we demand at least that of ourselves? Shouldn’t we, because of the financial consequences of what we do, be held to an even higher standard? We should not fear this - we should welcome it with open arms so that we can always hold our industry up to any level of oversight and be proud and beyond reproach. We allowed too many uneducated (mortgage18

February 2008

wise) and illiterate (financial-wise) individuals “sell” the false hope of the American. That house became a dream all right, it’s called a nightmare. It is alarming that State and Federal government officials are now coming out of nowhere to extol the devilish loan products and are grandstanding with bellowed voices to throw out the water, the baby, the tub, brokers, and yield spread as a means of showing their constituency they will make this right and make people pay. A certain case of misguided guile, and if I may say, a lot too late. It was never the loan products. It was the peddlers who offered those products and did so without the true purpose of the product or without the correct financial knowledge of how the product fit with that particular client or in some cases, just blatant profittaking. Add to that the flawed underwriting, because obviously the lenders were not “able to efficiently judge the risk posed by individual applicants.” Eliminating the sub prime market and making it almost impossible for many borrowers who can actually handle a mortgage is not the answer. The answer lies in ensuring that the professionals who are allowed to work in our industry have a true understanding of the loan products under their command and adhere to a moral and ethical standard above all other levels. Our industry has always talked about how the public needs to be educated about the mortgage process. This idea is well-intentioned and much needed. However, if the mortgage

professionals themselves are not at the very least equally educated, then what chance does the borrower have? The rapid changes seen in our industry over such a relatively short period of ten years would suggest that unless the internal education level had kept pace and the requirements of those participating in our industry kept pace, trouble would ensue at some point in time. We are dealing in a financial arena where for the most part the clientele is financially uneducated and so wide-eyed and bushy-tailed at the prospect of owning their first home, or that ultimate “dream home”, and they are at the mercy of someone equally as uneducated. It is here where the politicians and our own industry leaders need to stand up and state emphatically that “we will not take it anymore” and not bend to pressure about making sure anyone who wants to enter into our industry be tested and tested and tested some more. We can not leave anything to chance when the public is looking to us as the expert. The marketing gurus in our industry have used a term for some time in suggesting how we should present ourselves to the public – as a “Trusted Advisor”. Isn’t it about time for us to stop using the term and actually become the term? Michael J. Saldutti, CRMS, CMA. Owner and founder of Royal Bay Mortgage, Inc, the Wealth For Life University and Strategic Equity Management Group. Michael can be contacted at 215-352-3250 or at Michael@royalbaymortgage.com

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CO-OP LENDING What you need to know. BY JULIE TEITEL

What is the co-op and how is it financed? A cooperative apartment (co-op) is an individual living unit within a building or development where a buyer purchases shares (equal to the value of the unit) in a corporation that holds title to a building. Co-ops are predominantly located in New York and Chicago. Normally a sponsor will buy the building, many times holding the underlying mortgage, and then will sell off the shares. Therefore, when buying a co-op, you are not purchasing real property but actually shares in a corporation. For example, a sponsor owns a building with 20 units and sells it to a coop corporation. The co-op corporation will assume the sponsor’s underlying mortgage and buys 15 units. Each unit that the sponsor sells is assigned a specific share value based on the various characteristics (i.e., apartment size, view, etc.). The sponsor retains the unsold shares for five units and can rent them out and is also responsible for paying his/ her own maintenance on all the shares that he/ she owns. Lastly, any new buyer of a unit, called a share holder, is given a stock certificate for the specific share amount and a proprietary lease for the apartment at closing, instead of a deed. How are the buildings pre-qualified for lenders? To start with, a lender will look at the following factors to see if a particular building corresponds with their guidelines: the property’s presale value, investor concentration, and owner occupancy. Based on the

previous example, if there are 20 units, 5 sponsor rentals and 15 sold units (with 12 owner-occupied units and 3 units being rented by the owners), the following ratios and guideline percentages result: =8:KFI

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Although guidelines are lender specific, they are generally looking for: • • • • • •

Presale values greater than 51% Not greater than 25% investor concentration Not less than 500 square foot unit/apartment Walk-ups not higher than four stories Sponsors having positive cash flows on the units that they rent Co-op shares of sponsors not used as collateral for another loan (normally indicated in the financials)

What are the basic legal requirements before closing on a Co-op purchase? There are four basic requirements normally worked on by the bank attorney: 1.) A new UCC (Uniform Commercial Code Financing Statement) is filed before the purchaser closes on the coop. It is the actual recording of the bank’s interest in the stock certification in the cooperative corporation and in the

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proprietary lease covering the apartment.

2.) Lien/ Bankruptcy/ Judgment searches are required to search official records for judgments, bankruptcies, tax liens, mechanics liens, building violations and open UCCs conducted against the borrower, the seller and the cooperative corporation. 3.) If the seller currently has a mortgage and it is being paid off at closing, a UCC 3 Termination Financing Statement must be filed in order to discontinue the lien currently held against the seller. 4.) The Aztech Recognition Agreement is an agreement among bank, borrower, and cooperative corporation and sealed by the corporation and sealed by the corporation which sets forth the rights and obligations of all parties with respect to the loan. It ensures that the co-op board approves of the borrower’s financing. What are some other important items regarding co-ops to keep in mind? 1.) An attorney should review the coop building financials to make sure there is sufficient reserves and that the only debt carried is the underlying mortgage. 2.) An attorney should also review the coop board minutes to see if there is an upcoming assessment, pending litigation or discussions about items that might impact future maintenance. 3.) Many co-op boards will require the purchaser to put down anywhere from 20-50%, while some will not allow financing at all. 4.) The co-op board application, overall, will be more tedious and time consuming than a standard mortgage application. Additionally, on average, it is more difficult to get board approval than it is to get a mortgage. 5.) The co-op board can deny an applicant for any reason and does not have to give the reason for denial. 6.) Some buildings will charge a small percentage (1-3%) when the property is sold. This is called a flip tax. For example, if the property is being sold at $500,000 and the flip tax is 3% at the time of closing, the seller will only be receiving $485,000 ($500,000 minus $15,000 flip tax).

February 2008

7.) The banks will use the flip tax in the loan-to-value calculation. For example, in order to determine the value of the unit, the bank will use the lower of either the purchase price or appraised value minus the flip tax. Thus, if the purchase price is $100,000 and the appraised value is $125,000 and the flip tax is 3%, the bank calculates the value of the unit to be $97,000 ($100,000 purchase price minus $3,000 flip tax). If the purchaser is at the limit of the bank’s loan-to-value calculation, the unit’s “bank value” while incorporating the flip tax, can be critical. Julie Teitel has been a senior loan officer at New York Mortgage/ IndyMac Bank for 5 months. Prior to that she was with Mortgage IT for 15 years. Julie has been listed by “Mortgage Originator” magazine as one of the “Top 200 Mortgage Brokers” in the country for the last four years. She specializes in residential mortgages, particularly Coop and Condo loans, but also enjoys working on single family mortgages. Besides national recognition, she is currently one of the top mortgage brokers in her entire company of over 1500 employees.

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MASTERING THE POWER OF TWO A lender's point of view. BY TOM NINNESS

“The strength of any team is magnified by the significant ties and relationships that each member brings to the entire group. If you want to see your efforts and hard-work multiply, then bring the right team together and watch it take off!”-Tom Ninness, Summit Champions.

Mastering the Power of Two One of the strongest relationships from the lender’s point of view is the Realtor®/Lender partnership. Being a mortgage professional for 28 years, I have established strong partnerships and my agents regularly hand out my card to their clients as I’ve earned the right to receive this elite status. Looking for relationships where I can become the only lender of choice is a key secret to the success of The Power of Two. I don’t like to share, and part of my business plan is to contribute in the success of my Realtor® partners. If you are an agent who hands out three business cards from three different mortgage professionals, then reconsider and stick with one that understands the power of two in the Realtor®/Lender relationship. How Dynamic Partnerships Develop Like all relationships, they take time to incubate. There is a three part process necessary to develop outstanding relationships. It is necessary to know your partner well, get to like them, and learn to trust each other. Much of the risk is eliminated when you discover that “essence” match that will drive your business to new heights. Dynamic partnerships understand long-term business planning, coinvest in each other’s business and create regular standing meetings designed to increase their income and growing their businesses for future growth. I’m fortunate to say that I have 10 agents who only give out my card. Some of these agents are the best in our area. In fact, one particular agent and I average around fifty transactions a year with one year we partnered 110 transactions together. If you asked this agent, why he only 24

February 2008

uses one lender, he would tell you that the lender can make or break you and that I have a proven track record of getting things done and making him look good on every transaction.

Identifying Realtors who understand the Power of Two There are certain characteristics that I look for when it comes to investing in a Realtor’s business. It may take a number of interviews with the prospect to get to know, like and trust before an exclusive relationship is formed. To define a good prospect for me, I would need to know the following: • • • • • • • • • •

Works full time in their profession Invests in their business Creates loyalty with their clients for long-term opportunities Good networker Produces decent number of transactions Professional in appearance and the way they do business Coachable so that I can help them grow their business We have an essence match They respect me and my team A person I can trust

The top three would be: an essence match, a professional and a person who respects my team and me.

Characteristics of great working partnerships • Like-minded. Each partner understands that the customer is an annuity. They work together to squeeze every drop out of every opportunity. They understand how to build high trust with their clients together and always communicate through out each transaction. • Partner’s care about each other’s business. They understand the concept of being an extension of each other’s business. • Partner’s give honest feedback to each other. They are not

afraid to share where improvements need to be improved on to make the partnership work even better. • Each person has a good balance in their personal and business relationship. Dynamic partnerships know when to work and when to socialize. • Their partnerships are a win-win for both of the partners. None of the partners try to take advantage of each other. • Become cross-selling experts to each other. The lender reinforces the client’s decision in choosing the Realtor® and the Realtor® always supports the lender during the loan process. • Partner’s annual commissions increase together. The Realtor® doesn’t ask for referral fees or ask the loan officer to cut his commission to make a transaction work. Both the Lender and Realtor® respect each other’s profession and understand profit and loss management is important to both of them. If the partnership is working, maximum commissions are earned by both parties and outside referrals will continuously come in.

What do you do when THE Partnership breaks up? I’ve had this happen once and believe me; it was

like losing a great friend. It was my fault, and I took full responsibility for the dismantling of our partnership. I continued to stay in touch as our friendship was still important and though it took over two years, we have reconciled and the partnership is going strong.

Final Thought For the partnership to truly work well, each cannot look at the other as “just another vendor”. This also applies to the title company, inspection services, insurance agent and the 1031 company. The Realtor® partnerships that I’ve formed over the years are fun and exciting. We are always looking for ways to help each other. There is a true friendship and we look to add to each others’ life. I hope that you can form the same kind of partnerships in all of your key areas of business. Tom Ninness is the President of Summit Champions. He has created the “90 Day Journey” for sales professionals. To learn more about Summit’s products, coaching, and the 90 Day Journey, go to www.summitchampions.com or www.90dayjourney.com. You can contact Tom direct at information@summitchampions.com.

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MI IS TAX-DEDUCTIBLE THROUGH 2010! Answers to commonly asked questions. BY MORTGAGE GUARANTY INSURANCE CORPORATION (MGIC)

Reprinted with permission from MGIC

orrower-paid MI premiums are now taxdeductible through the year 2010. Because it’s still new, the law has raised many questions. Here are answers to commonly asked questions regarding the new law. We will continue to post updated information as regulators sort out the details. Borrowers should consult their tax advisors regarding MI tax deductibility. See disclaimer note below.

FAQs Does the bill apply to MGIC mortgage insurance? Yes, borrower-paid MI provided by MGIC qualifies for the deduction. This includes our Monthly, One-Time MI and Split Premium plans. There are varied opinions on the deductibility of lender-paid MI as the IRS has not yet clarified the deductibility. It is recommended that borrowers consult their tax advisors regarding the amount that is deductible. What types of mortgage loans qualify for the MI tax deduction? Loans used for “acquisition indebtedness” — that is, money borrowed to buy, build or substantially improve a residence — are eligible, as long as the debt is secured by the same residence. This includes purchase loans and refinance loans, up to the original acquisition indebtedness. (Money 28

February 2008

borrowed against the equity in a home or when refinancing a home for any reason other than to buy, build or substantially improve a residence is called “equity indebtedness.”) When refinancing a piggyback loan originally used to acquire a property, is the original loan amount considered the sum of the two mortgages or only the primary mortgage amount without the second lien included? The original acquisition indebtedness is considered to be the sum of the two mortgages. Is deductibility applicable for all loan types? There is no differentiation among loan types. What types of properties are eligible for tax deductibility? The deduction applies to “qualified residences,” as defined in the Internal Revenue Code. Generally, that includes the borrower’s primary residence and a nonrental second home. As with mortgage interest, borrowers can deduct mortgage insurance premiums paid on both their primary residence and one other qualified residence each year. Investor loans are not eligible. Who qualifies for this itemized deduction? Households with adjusted gross incomes of $100,000 or less will be able to deduct 100% of their MI premiums. The deduction is reduced by

10% for each additional $1,000 of adjusted gross household income, phasing out after $109,000. (Details below.) Married individuals filing separate returns who have adjusted gross incomes of $50,000 or less will be able to deduct 50% of their MI premiums. The deduction is reduced by 5% for each additional $500 of adjusted gross income, phasing out after $54,500. (Details below.) The deduction is not restricted to first-time homebuyers. Is adjusted gross income calculated before or after deductions? Adjusted gross income is calculated before itemized deductions, including the MI deduction. How does the MI tax deduction work? Borrowers who itemize deductions are able to reduce their overall taxable income in the same manner as mortgage interest. Are borrower-paid, single premiums, which are paid up front in a lump sum, eligible for the deduction? Yes, borrower-paid, single-premiums are eligible for the deduction under the new law. Borrowers should consult with a professional tax advisor to determine the amount of the MI premium eligible for the tax deduction. If the single premium is financed, are both the mortgage insurance premium and the interest taxdeductible? We believe that if the loan is for acquisition indebtedness, both the interest attributable to the entire loan balance as well as the allocated portion of the mortgage insurance premium are tax-deductible. How would a premium refund issued during the tax year affect eligibility and the amount of the MI deduction? Borrowers are only permitted to deduct that portion of their MI premium attributable to a tax year. If the MI is dropped, and a refund is paid, the amount refunded would reduce the amount of MI premium that could be attributable to that tax year and be deducted.

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CENTER STAGE

CENTER STAGE WITH A LA MODE A candid conversation with Brad Eaton, VP Mortgage Products. BY THE NICHE REPORT

his month The Niche Report brings you a company that’s helped mortgage professionals effectively market themselves for years. If you visit a loan originator’s website, more than likely that website is an XSite created by a la mode. a la Mode has developed a successful formula for BRAD EATON bringing together high quality site design and online marketing capabilities for many mortgage industry professionals. We sat down with Brad Eaton, VP Mortgage Products. Tell us a little bit about a la mode. We got our start in 1985 with our appraisal formfilling software TOTAL (now known as WinTOTAL). Since then, we’ve become a leader in three different real estate verticals by developing software, marketing tools, workflow management systems, and e-commerce technology for appraisers, mortgage brokers, home inspectors, and real estate agents and brokers. WinTOTAL, the appraisal management software that gave us our start, is now used by more than half of all the real estate appraisers in the U.S.. And obviously, mortgage brokers, loan officers, home inspectors and REALTORS® are now equally important business partners with us. Five years ago we began our development of XSites for those markets because we saw so many hard-to-use, generic website products popping up everywhere. Our response was to build a website product that actually does something for our clients. Not just an online brochure or business card. An XSite fits into a real estate professional’s overall marketing plan, enabling them to do productive business 32

February 2008

via the World Wide Web, and generate solid customer/ client leads at the same time. Tell us about the company culture. We believe in three things – working hard, having fun, and making money. And simply said, we hire the best, most talented individuals from all types of backgrounds that add to this overall philosophy. We don't just hire techie people, slap a headset on them and tell them to take as many calls as they can all day. We understand that we’ve got to make incredible products first. But we also understand that we’re in the people business, too. So we staff our customer support call center with highly-trained, well paid professionals twentyfour hours a day, every day of the year. Many of our senior managers have risen through the ranks of our customer support department, so the whole process is very important to us for multiple reasons. It's hard to find a technology company with this level of commitment in any industry, let alone in the real estate and mortgage industries. We've certainly not found one of our direct competitors with this level of access to help for their customers. We're privately held and our founder, David Biggers, has set this customer care example from day one. Our call center is located in Oklahoma City where you'll find some of the smartest and hardest working people anywhere, so we have a great labor pool to pull from. So, what is a la mode doing to proactively stay ahead of the rapidly changing real estate market? A lot of mortgage and real estate technology providers are finding themselves in a box right now. They either

CENTER STAGE

don't have multiple markets and revenue streams to rely on like we do, or, unlike us, their revenues rely strictly on transactions, which is a horrible place to be in a down market. Or, in some cases, their business model is relatively sound, but their company was perhaps venture backed during the market boom and now the financial backers are pulling out or their management team is freaking out since they've never navigated through rough times. One thing that seems consistent with all of them is the unwillingness to invest significantly, if at all, in new feature and product development. In a lot of industry press we've read, our competitors are cutting services, not releasing new ones. We're different. We've seen about three of these downturns in the 23 years we've been in business, so this isn't our management team's first rodeo. More importantly, we've never taken on any debt or outside investment, so our financial position is strong enough to take us through any market downturn. These two facts enable us to invest in the development of new products and new features to existing products while, frankly, our competitors are focused on keeping their doors open. It's a huge difference in philosophy and approach and you can bet our customers and prospects notice it. You released a free website product last summer. Was that a move to stay ahead of the change? Not really. The Originator level websites were born from the confidence we have in our own products. We know that a certain percentage of people who try out our XSites see how easy they are to set up and how great the workflow tools are will become longtime customers. So we just wanted to make it easy for people to do this without the time constraints of a typical demo. Anyone can set up a fully functional Originator site and try out the full Office Level features for 20 days. Many will upgrade to the full Office version. Some will decide that the free version provides all the functionality they need for right now, and that’s fine. Those who choose the free website product may upgrade to our full-featured, paid products down the road when it is right for them. So the original intent was to increase our market share and make money – that’s still the intent, actually. We think making money is a good thing. But with the downturn in the market, the free Originator level also became the perfect choice for LO’s

who can’t commit hundreds or thousands of dollars per year to a website right now. And we’re perfectly fine with that as well. The Originator level gives those customers the basic set of tools they need to do business on the web – a simple website, e-mail address, lead capture, and loan app. Those tools cost hundreds previously, and we’re proud to be the company with enough resources to deliver those necessities at no cost. And we know that when the market returns to whatever level is sustainable, we’ll have the customers who’ve weathered the storm because of our tools. And what products have you released more recently? Most of our development lately has been put into our XSites product. The reality is that typical websites are passive. They often present information to consumers in an anonymous and impersonal way. The clear advantages of that passivness are that customers can get information they need any time, day or night from the comfort of their own home or office without being “hounded” by a salesperson. The disadvantage, however, is that typical websites don’t give customers personal interactive service that a home loan requires. And in today’s climate, personal service could be the key differentiator in someone’s choosing one LO over another. To combat this, our XSites now include XSites Desktop – a simple program that constantly pushes information to the website’s owner. Now we’re working on different “Plugins” that will be released to the XSites Desktop over time. We currently have three Plugins for XSites Desktop for mortgage pro’s. Loan Application Plugin The Loan App Plugin shows a live view of all your loan apps either in-progress or completed on a Mortgage XSite. It also interfaces with your LOS – including Calyx Point® - to export loan apps and push status information back to the XSite where borrowers, agents, or anyone else in the process are notified through either e-mail, status login or both. Collaborator This one is in a free “public beta” until March this year. Collaborator puts you in complete control of the experience of visitors on your XSite. It alerts you instantly when a visitor arrives at your site, shows you exactly what pages they’re looking at, and even shows you their physical TheNicheReport.com

CENTER STAGE

location. It also enables a two way chat that can be initiated by either the XSite owner or the web visitor. The customer reaction to this one has been just incredible! Our customers are now capitalizing instantly on their web traffic. It’s really cool. Performance Index Plugin We built this Plugin because we understand that marketing (especially on the Web) is hard work. And it’s still uncharted territory for most LO’s. The Performance Index Plugin measures the overall effectiveness of an LO’s website and gives it a score. We then proactively make suggestions on ways our customers can improve their customer’s website experience, search engine rankings, and lead generation. Now instead of having to research and interpret website visitor statistics and formulate a plan, our customers just have to check their Performance Index score and follow the action plan we lay out for them.

February 2008

What can we expect to see from a la mode in the future? Simply said – more of the same. We will continue to push the envelope, develop products that anticipate market changes and answer to market demands. We pride ourselves on being able to turn on a dime and will continue to change and grow with our customers. To learn more about a la mode, and their products visit www.alamode.com. Brad Eaton is the VP Mortgage Products in charge of a la mode’s Mortgage XSites, SureDocs and all other mortgage products. He’s been with a la mode for over 6 years during which time he’s been involved in all aspects of our appraisal, agent and mortgage products. Brad is a regular presence at NAMB, MBA, MBA Tech and FAMB where you many have met him at our trade show booth. He lives in Oklahoma City with his wife and two children and enjoys fly fishing, 4 wheeling in his Jeep and of course computers and technology.

TIP OF THE MONTH

TIP OF THE MONTH Should I Stay or Should I Go? BY STEWART MEDNICK

uring this period of an eco nomic recession poking its ugly head into this country’s fiscal wellbeing, the real estate market has slowed down to the point of the mortgage industry nearly being in a coma. Many mortgage professionals are still writing loans, but at a diminished capacity. Many mortgage professionals have chosen the road of greater means and left the industry for simple survival reasons. Yet few are still struggling financially, morally, or emotionally over the decision of, “should I stay in the mortgage business or should I find a new or temporary career?” Let’s explore this decision process. The first thing to consider is the state(s) in which you are licensed to originate. The country as a whole is nearing a recession. The state I live in just declared a recession. The rate of loan closings has slowed down considerably. More people call about refinancing their home with no equity available than people who want to buy a new home. Other states are worse off with declining home values and an abundant amount of foreclosures. It seems all doom and gloom. Perhaps not. The next thing to consider is your own resources: financial savings, professional network, and other portable skills. Financially, you must be able to pay the bills and put food on the table. If you are suffering due to lack of closings, then can your savings embellish your living? Do you have savings? Have you built and maintained a professional network to get business? On the flip side of the decision process, do you have a skill set or prior experience that can be applied in another industry? Can your network help you with finding a new source of income in another line of work? 36

February 2008

Finally, how stable is your mental wellbeing? The stress of finding loans, clearing the loan to close and getting paid in time to meet your financial requirements can be very stressful. Anxiety, depression, rage, excessive drinking or smoking, and strained relationships are all signs of mental and emotional stress. Perhaps finding a new line of work may eliminate these issues. I am not a psychiatrist or a career counselor, but I go through the same issues any of you go through. So I suggest you make a list of strengths and weaknesses about yourself and your industry. Look at the issues I mentioned above and others you may find relevant. If the strengths of staying in the business out weigh the weaknesses, then stay in. If not, then consider a new career. Many of you may even find a compromise and pursue part time work to make ends meet. Maybe even find a line of work that can compliment the mortgage industry or even help find referrals such as a home improvement sales person, working as a personal banker, or customer service in a “big box” department store such as Home Depot or Best Buy. Going back to school to pursue a career in technology or healthcare may not be so bad either, just keep your origination license active. Bottom line is simple: whatever it takes to survive. I mean survive financially and mentally. There is great opportunity in the mortgage business now with reverse mortgages, foreclosure bail outs, and investment property to name a few. You need to decide. Send me an email with your thoughts on the topic; we can all use some good advice. Stewart Mednick is a seasoned mortgage banker and published author. His writing focuses on relationship development, customer satisfaction, marketing and sales techniques. Mednick is also a business coach and consults on these topics. Send emails to Stewart Mednick at smednick1@netzero.net or call 651-895-5122.

NICHE REPORTS

PRIME Gateway Mortgage Group 817.545.6153 A.E. is Jerry Lair

"Best in Business" Technology giving you 24/7 access to the industry leading rates and service you should expect from an Inc. 500 organization.

Gateway Mortgage Group

To SISA - EAII-VA-Manual FHA Available to 570 Credit-Broker Packet on Rate Page www.nonprimewholesale.com.

817.545.6153 A.E. is Jerry Lair

Indymac Bank

Agency Conforming and Fannie Mae programs available, including MyCommunityMortgage™, Flexible 97™, Flexible 100®

866.690.2242

Indymac Bank

Reverse Mortgage products available for FHA- and Non-FHAapproved customers. Flexible lending limits for higher-value homes

866.690.2242

Irwin Home Equity 888.524.7946

World Alliance Financial

Combo programs; 100% First with 125% Second for complete financing with no PMI, Full Doc, Cash Back up to $100K Reverse Mortgage opportunity for non-FHA licensed brokers

877.692.7762 ext. 404

ALT–A Emigrant Mortgage Company, Inc. 1.800.EMIGRANT (364.4726) x Mid-Atlantic

Emigrant Mortgage Company, Inc. 1.800.EMIGRANT (364.4726) x Mid-Atlantic

True Portfolio Lender offering NINA Loan Programs, Max LTV of 75%, Loan Amounts up to $1MM+ considered. Don't forget to mention this ad when calling for special service response! NINA financing for applicants with Ficos below 600, max LTV 60%, Loan Amounts up to $1mm+ considered. LowDoc (Income Verification) financing for foreclosure bailouts also available up to Max LTV of 60%

Financing may not be available in all states. The above summaries are intended for Mortgage Professionals only, and not intended for distribution to consumers, as defined by Section 226.2 of Regulation Z, which implements the Truth-In-Lending Act. Information is subject to change without notice. Refer to each lender’s information on products, program, procedures, representations, and warranties for details.

TheNicheReport.com

NICHE REPORTS

Griffin Capital Funding 800.710.6782

Indymac Bank

Full Doc and Stated income commercial loans. 3% YSP +2 points paid to brokers 3/1, 5/1, 7/1, and 10/1 LIBOR ARMs; 15- and 30-year Fixed; 10-year I/O period available for ARMs and 30-year; temporary buydowns and long-term locks also available

866.690.2242

Indymac Bank 866.690.2242

Full Doc up to 97% LTV with a minimum 660 Decision Credit Score (DCS); Stated Income up to 90% LTV with a minimum 660 DCS; DTI as high as 55%

Real Estate Capital

Money for down payments and closing costs. Make deals happen that otherwise would not

877.366.6114 ext. 4001 Dave

NONPRIME EquiFirst Corporation 800.232.3477

EquiFirst Corporation 800.232.3477

Griffin Capital Funding 800.710.6782

Real Estate Capital 877.366.6114 ext. 4001 Dave

The Helvetica Group 888.866.3426

Up to 95% LTV with a 660 Score, Full Doc Purchase. Up to 90% LTV with a 580 Score, Full Doc Refinance Loan amounts up to $750,000 Full Doc Core Product. Loan amounts up to $1.5 million Full Doc Jumbo Product Full Doc and Stated income commercial loans. 3% YSP +2 points paid to brokers Money for down payments and closing costs. Make deals happen that otherwise would not No FICOÂŽ underwriting, foreclosure bailouts, BK buyouts, no seasoning, unlimited cashout, unlimited mortgage lates; Up to 65% LTV. Stated income, flex DTI, interest only programs available. Super Jumbo loans to $7M+. CA, AZ, CO, NV, OR, WA

Financing may not be available in all states. The above summaries are intended for Mortgage Professionals only, and not intended for distribution to consumers, as defined by Section 226.2 of Regulation Z, which implements the Truth-In-Lending Act. Information is subject to change without notice. Refer to each lenderâ&#x20AC;&#x2122;s information on products, program, procedures, representations, and warranties for details.

February 2008

NICHE REPORTS

HARD MONEY 888.333.9923

Specializing in commercial real estate bridge loans from $3 M to $100 Million. All property types. 24-Hour commitments. Close in as little as 5 days. Great low rates. No upfront fees beyond out-ofpocket expenses on qualified loans. www.24capital.com

Anglo-American Financial, LLC

DIP (Debtor-in-Possession) Financing Available

24 Capital

434.981.1017

Anglo-American Financial, LLC 434.981.1017

Avatar Financial Group 888.896.0083

Blue Water Funding, LLC 301.656.6566 or toll free 866.561.Blue

Commercial Lending, LLC

Asset-based lending on real estate, consumer receivables and other readily marketable assets No-prepayment penalty bridge loans starting at 9.99% on existing commercial. Including churches, gas stations and SFRâ&#x20AC;&#x2122;s Apply online at www.BlueWaterFundingLLC.com, Immediate Response, Brokers Protected and Respected Direct Lender, 65% Loan to Value, No Pre-Payment Penalty, Lending Throughout the Mid-Atlantic Region

800.755.7310 ext. 201

Asset-based lending on real estate, consumer receivables and other readily marketable assets

Crown Valley Group, Inc.

Fast turn around, Brokers paid at closing

770.642.8140

Fairview Commercial Lending 866.634.1270

First Mount Vernon 866.908.FMV1 (3681)

No minimum credit score, foreclosure bailouts, Quick Closings nationwide, commitments in 24 hours No seasoning requirements, No upfront commitment or processing fees, Minimum credit score 400

Financing may not be available in all states. The above summaries are intended for Mortgage Professionals only, and not intended for distribution to consumers, as defined by Section 226.2 of Regulation Z, which implements the Truth-In-Lending Act. Information is subject to change without notice. Refer to each lenderâ&#x20AC;&#x2122;s information on products, program, procedures, representations, and warranties for details.

TheNicheReport.com

NICHE REPORTS

First Mount Vernon

Minimal documentation required, Combined Loan-to-Values to 105%

866.908.FMV1 (3681)

The Helvetica Group 888.866.3426

Manaseh, Epharim & Associates 678.387.3230

Value Home Loan, Inc. 877.782.2274

No FICO® underwriting, foreclosure bailouts, BK buyouts, no seasoning, unlimited cashout, unlimited mortgage lates; Up to 65% LTV. Stated income, flex DTI, interest only programs available. Super Jumbo loans to $7M+. CA, AZ, CO, NV, OR, WA Commercial Private Equity Lending: No FICO® underwriting, foreclosure bailouts, BK buyouts. Multi-family and Commercial loans from $300K to $10.0M+ Up to 60% LTV. Fast flexible underwriting and creative solutions. Nationwide, metro areas Private hard money financing for commercial real estate investments Brokers paid up to 10 points on HELOC’s; Neg-am option for all loans; no FICO requirements, Foreclosure bailouts; Stated income/ Stated Asset

COMMERCIAL 24 Capital 888.333.9923

Specializing in commercial real estate bridge loans from $3 M to $100 Million. All property types. 24-Hour commitments Close in as little as 5 days. Great low rates. No upfront fees beyond out-ofpocket expenses on qualified loans. www.24capital.com

AcuPen Financial

High LTVs, and low debt coverage ratio requirements

305.666.1879

Avatar Financial Group

20 & 25 year fully amortizing on existing commercial properties

888.896.0083

Crown Valley Group

Fast turn around, Brokers paid at closing

770.642.8140

February 2008

NICHE REPORTS

Equitable Commercial Lender, Inc. 213.249.9113

Nationwide Wholesale Commercial Lender. Stated Income, Full Doc & SBA programs available. Loan amounts from $100k - 5 Million. Easy Broker Approval Process

Fairview Commercial Lending

No minimum credit score, foreclosure bailouts, Quick Closings nationwide, commitments in 24 hours

866.634.1270

Griffin Capital Funding 800.710.1270

The Helvetica Group 888.866.3426

Imperial Capital Bank 888.886.3580

Indymac Bank 866.908.3279

Ocean Capital 877.337.3757

Manaseh, Epharim & Associates

YSP Commercial Loans, Full doc and Stated income. Earn up to 3% YSP + 2 points. Commercial Private Equity Lending: No FICOÂŽ underwriting, foreclosure bailouts, BK buyouts. Multi-family and Commercial loans from $300K to $10.0M+ Up to 60% LTV. Fast flexible underwriting and creative solutions. Nationwide, metro areas Adjustable & fixed perm programs up to 80% LTV. Hybrid & Bridge loans available for most income property types. Flexible structures to meet the needs of the brokers and borrower Up to $5 million; purchase and refinance (including cash out); 5, 7, and 10 year Hybrid ARMs (30 year fully amortized with Interest Only option); 7, 10, 15, and 30 year Fixed (30 year fully amortized with Interest Only option on 10 and 30 for up to two years) Loans for: Multifamily / Apartment Complexes (5+ units); Mixed Use (if Commercial is less than 35%); Mobile Home Parks We're the real deal for subprime owner-occupied commercial mortgages to $2M. Credit scores to 500. Up to 90% financing. Low debt-service coverage. Stated & investment programs. Difficult-tofinance industries welcome Fast, flexible funding for all your commercial financing needs

678.387.3230

Metro Funding Corp 866.302.6360

Real Estate Capital 877.366.6114 ext. 4001 Dave

Fast closing, no points upfront, all commercial properties including land, acquisitions, refis, and development loans Money for down payments and closing costs. Make deals happen that otherwise would not

Financing may not be available in all states. The above summaries are intended for Mortgage Professionals only, and not intended for distribution to consumers, as defined by Section 226.2 of Regulation Z, which implements the Truth-In-Lending Act. Information is subject to change without notice. Refer to each lenderâ&#x20AC;&#x2122;s information on products, program, procedures, representations, and warranties for details.

TheNicheReport.com

NICHE REPORTS

CONSTRUCTION 24 Capital

888.333.9923

Bismark Mortgage 503.741.7334

Commercial Lending, LLC 800.755.7310 ext. 201

Indymac Bank

Residential construction loans for custom, owner-builder, spec and construction completion projects. All programs Stated Income/ Stated Asset. Nationwide lender. Equity Based, No Prepayment, No Minumum Credit Score, 6 month and 12 month programs, No pay and interest only pay programs, Up to 70% LTV, Online Broker Portal

866.913.3863

Construction-to-Permanent (CTP) Loans up to $5,000,000, Ownerbuilder program; 24/7 Online Draw Requests; Full Doc and Stated Income; dedicated construction support

Manaseh, Epharim & Associates

Private lender specializing in commercial real estate loans nationwide and internationally

678.387.3230

Meecorp Capital Markets 201.944.9330

Commercial lender providing fast, creative funding solutions nationwide. Bridge loans, mezzanine debt, construction financing (including land development) and occasionally equity participation

ADVERTISE YOUR NICHES HERE WITHIN Financing may not be available in all states. The above summaries are intended for Mortgage Professionals only, and not intended for distribution to consumers, as defined by Section 226.2 of Regulation Z, which implements the Truth-In-Lending Act. Information is subject to change without notice. Refer to each lenderâ&#x20AC;&#x2122;s information on products, program, procedures, representations, and warranties for details.

February 2008

LENDER & RESOURCE DIRECTORY

24 Capital Corp. www.24capital.com Two University Plaza, Suite 206 Hackensack, NJ 07601 [phone] 888.333.9923 [fax] 201.881.7221 [e] info@24capital.com

AcuPen FINANCIAL, LLC The Premier One-Stop Commercial Mortgage HUB www.acupenfinancial.com Anglo-American Financial www.anglofinancial.com 675 Berkmar Court Charlottesville, VA 22901 Gardy Bloemers: 434.981.1017 [e] gardybloemers@anglofinancial.com Tom Finnegan: 512.657.9310 [e] tomfinnegan@gmail.com AppraiserLoft www.appraiserloft.com [phone] 877.229.7799 [fax] 877.797.0280

ASCENT HOME LOANS, INC. www.ascenthomeloans.com 6465 S. Greenwood Plaza Blvd. Englewood, CO 80111 [phone] 866.467.3157 ext. 2605

AVATAR financial group www.avatarfinancial.com 100 Wall Street Seattle, WA 98121 Contact: Allison Payne, Loan Analyst [phone] 888.896.0083 [fax] 206.728.5993 [e] loans@avatarfinancial.com BISMARK MORTGAGE www.bismarkmortgage.com 10500 NE 8th St. Suite 700

Bellevue, WA 98004 Contact: Ron Maes [phone] 503.741.7334 [fax] 425.283.5005 [e] ron@bismarkmortgage.com

BlueWater Funding, LLC www.bluewaterfundingllc.com 4925 St. Elmo Avenue Bethesda, Maryland 20814 [phone] 301.656.6566 [fax] 240.766.0609 [e] info@bluewaterfundingllc.com

THEBOARDNETWORK.COM www.mortgageboard.com www.titleboard.com www.bankingboard.com www.creditunionboard.com www.escrowboard.com 101 Continental Blvd. 16 Floor, Suite 1657 [phone] 866.452.8800 [fax] 866.452.8799 Contact: Julie Messina or Jodie Messina [e] info@theboardnetwork.com

COMMERCIAL LENDING, LLC www.commericallendingllc.com 7603 Maple Branch Road Clifton, VA 20124 [phone] 800.755.7310 ext. 201 [fax] 703.852.7933 Contact: Will Lansing [e] wlansing@commerciallendingll.com

credit plus inc. www.creditplus.com 31550 Winterplace Pkwy Salisbury, MD 21804 [phone] 800.258.3488 [fax] 800.258.3287 [e] beyondbundled@creditplus.com

Crown valley group, inc. www.crownvalleygroup.com 1405 Old Alabama Rd. Roswell, GA 30076 Contact: Robert Pick [phone] 770.642.8140 [fax] 770.518.0823 [e] rpick@crownvalleygroup.com

direct marketing associates www.dmaleads.com 5215 NW 33rd Avenue Ft. Lauderdale, FL 33309 [phone] 561.807.6909 [fax] 877.984.9401 Contact: Jim Gilbert [e] jgilbert@dmaleads.com

DOUBLE POSITIVE MARKETING www.doublepositive.com Corporate Headquarters Tide Point - Cascade Building 1030 Hull Street Suite 300 Baltimore, MD 21230 [phone] 888.dpositive (888.376.7484) [fax] 410.332.1059

emigrant mortgage company www.emigrantmortgage.com 7 Westchester Plaza Elmsford, NY 10523 [phone] 1.800.emigrant ext "mid-atlantic" Contact: Terry Auth [e] uthT@emigrantmortgage.com

equifirst corporation www.equifirst.com 500 Forest Point Circle Charlotte, NC 28273 [phone] 800.232.3477 [e] results@equifirst.com continued on next page TheNicheReport.com

LENDER & RESOURCE DIRECTORY CONT.

EQUITABLE COMMERCIAL LENDER, INC 3250 Wilshire Blvd Suite 1001 Los Angeles, CA 90010 [phone] 213.249.9113 [fax] 213.249.9116

Fairview Commercial Lending www.fairviewlending.com 1932 North Druid Hills Road Suite 250 Atlanta, GA 30319 [phone] 866.634.1270 [fax] 404.634.0319

first fINANCIAL mortgage service, LLC www.ffmloans.com [phone] 703.989.2293 [fax] 703.991.2362 [e] kristen@ffmloans.com First Mount Vernon I.L.A. www.FMV1.com 6019 Tower Court Alexandria, VA 22304 [phone] 703.823.6800 [fax] 703.997.2499

GATEWAY MORTGAGE GROUP www.nonprimewholesale.com 3820 Laurel Lane Bedford, Texas 76021 [e] weirdloans@nonprimewholesale.com AE: Jerry Lair [phone] 817.545.6153 [fax] 918.392.8364 griffin capital funding www.ysploans.com 1135 Heatherstone Dr. Suite 102 Fredericksburg, VA 22407 Contact: Mike Brewer [e] mbrewer@gcfunding.com [phone] 540.548.1001 ext. 105 [fax] 540.548.1117

February 2008

Guaranteed Rate, Inc. www.griwholesale.com 3940 N. Ravenswood Chicago, IL 60613 Contact: Tim Dooley [e] tim@teamdooley.com [phone] 877.377.4067 [fax] 877.377.4970 the helvetica group www.helveticagroup.com 11620 Wilshire Blvd., Suite 890 Los Angeles, CA 90025 Contact: Johnny Camarena [e] loans@helveticagroup.com [phone] 888.866.3426 [fax] 866.844.3295

imperial capital bank www.imperialcapitalbank.com [phone] 888.886.3580 IndyMac Bank www.indymacb2b.com 3465 East Foothill Boulevard Pasadena, CA 91107 [phone] 866.419.4639

irwin home equity www.ihepartners.com 12677 Alcosta Blvd., Suite 500 [e] wholesalelending@ihe.com [phone] 888.524.7946 manaseh, epharim & associates www.meandassociates.com 5932 Hugh Howell Rd. Suite 109 Stone Mountain, GA 30087 Contact: R.D. Walker [e] info@meandassociates.com [phone] 678.387.3230 [fax] 678.302.6444

meecorp capital markets www.meecorp.com 2115 Linwood Avenue, Suite 301 Fort Lee, NJ 07024 Contact: Daniel Edrei [e] principal@meecorp.com [phone] 201.944.9330 [fax] 201.944.9332

metro funding corp www.metrofundingcorp.com One Kalisa Way, Suite 310 Paramus, NJ 07652 Contact: Jennifer Smith [e] jennifer@metrofundingcorp.com [phone] 866.302.6360 [fax] 201.262.6910 money tree [phone] 818.449.960 Contact: Sarkis hart

ocean capital www.oceancapitalonline.com 2 Altieri Way Warwick, RI 02886 [e] information@oceancapitalonline.com [phone] 877.337.3757 [fax] 401.739.9711 Real estate capital www.quickrealtyfunding.com 3 Bala Plaza East, Suite 117 Bala Cynwyd, PA 19004 Contact: David Brown [phone] 877.366.6114 ext. 4001 [e] dbrown@tcfinancialgroup.com

Searchmyloan.com "It's All About The Search!" www.searchmyloan.com 921 Port Washington Blvd. Suite 2 Port Washington, NY 11050 Contact: Jay Black [phone] 516.767.9292 ext. 304 [fax] 516.767.9218 [e] jay@searchmyloan.com value home loans inc. 5959 Topanga Canyon Blvd. #201 Woodland Hills, CA 91367 [phone] 877.782.2274 [fax] 818.742.0015 world alliance financial www.worldalliancefinancial.com 3 Huntington Quadrangle, Suite 303N Melville, NY 11747

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