“Attack of the Killer Bubbles!”

April 15, 2008 at 10:38 am · Filed under Poulsbo Real Estate, Real Estate Bites, Sparks from Sparky, Bite Me Blogs

As many of you may know, I am a Community Builder with ActiveRain, a very large real estate network and blogging platform. It’s a start-up based out of Bellevue WA, and has over 80,000 members throughout the US and Canada.

Part of my role is to simply monitor the network, make sure the members are behaving, and to field questions.

Earlier today, I received an e-mail from a fairly new member out on the East coast. She’s in her in late 20’s, is relatively new to the real estate profession (she didn’t pick the best time to enter the fray!), and is working through the challenges of establishing her business in a slow market.

She recently wrote an article about real estate commissions and the portion that actually ends up in the agent’s bank account. It was a well-written article. However, no sooner had she published it, than a swarm of bubble bloggers descended upon her post and unleashed their commenting fury.

The first volley of comments were fairly typical of most bubble bloggers, but as the discussion slowly devolved, they became increasingly base and personally degrading towards the young author.

(For my regular readers, please forgive the following uncensored re-publishing of a few of these comments. I don’t usually allow this kind of language within the confines of SoundBiteBlog, but I felt it necessary to include them here)

One of the Bubble Bloggers made this degrading comment:

After reading the various posts on this subject, I think that everyone involved is failing to see the big picture here which is that —– is one hot mamma jamma MILF and I can tell that she is a jackal in the sack.

In fact, I would like to bone her very much if she is ever open and willing to fulfill my naughty realtor mom who will do anything to close the deal fantasy.

Most of you are so caught up in your evil realtor nonsense that you can not appreciate a fine cougar when you see one.

 —–,  love you long time.  You are the bomb in my book.  You can flip my house any day.

 Call me.

-Dave

 P.S: Post more pictures.

And another example of this senseless filthy attack:

I’ll pay you 6%. You have proven your worth. I just have one question:

Does that 6% get me some “alone time” in the VIP room and a guaranteed happy ending?

Because I think it’s only fair that I can do to you what your commission would be doing to me.

-L. Flynt

We’ve had a few Seattle area Bubble Bloggers frequent SoundBiteBlog. Most of these individuals are extremely sharp. They’re very articulate and can discuss intricate economic indicators on a equal or better footing than most investment professionals. One in particular has become somewhat of a regular around here. Last time he stopped by, he actually gave me a compliment!

Many Bubble Bloggers tend to be rather argumentative and abrasive by nature, but rarely do they descend to this level of vicious attack. I was able to trace one of the perputraitors back to their blogspot site, and left a few choice comments of my own, along with the charge that he and his blog thugs didn’t reflect or represent the majority of Bubble Bloggers I had encountered.

No doubt they’ll hunt me down now and make me their next target….oh goody!

Bookmark this article to:

Comments (10)

C-STOCK’s “Damn Yankees!” a Damn Good Musical!

September 19, 2007 at 1:00 pm · Filed under Bites of Washington, Bites of Kitsap, Sparks from Sparky, Bite Me Blogs

I figured since we can never seem to get a fair shake or a reasonable review of our shows, that I would offer up my own critique.

Last weekend saw the opening ‘homerun’ performances of C-STOCK’s “Damn Yankees!” a spirited team effort by local kids and adults alike, under the skilled direction of Chris Borer. This was Chris’s 2nd time at the theatre’s helm, having had his directorial debut with “1940’s Radio Hour” in 2005.

As usual, Chris has a really great eye for talent and did a great job of casting people in just the right parts. He is also a great visionary, and sees the BIG picture of a production. But more than anything else, Chris creates a wonderfully fun, creative, and encouraging environment for everyone involved. “1940’s” was my first show with C-STOCK, and so I was thrilled to be re-united with Chris.

If you’re not familiar with the musical comedy “Damn Yankees!” it made its Broadway run back in 1955 with over 1,000 performances. It’s based on a novel by Douglass Wallop entitled, “The Year the Yankees Lost the Pennant.” Music & Lyrics were provided by Richard Adler and Jerry Ross, the same team that brought us “The Pajama Game.” It’s an updated version of the classic Faust story, set in Washington, D.C., during a time when the New York Yankees dominated Major League Baseball.

A middle-aged real estate agent, Joe Boyd (gee, that sounds familiar!) is an avid Washington Senators fan and wants nothing more than to see his beloved team win the pennant. Unfortunately, the team is full of mis-mananaged misfits, and sits at the bottom the division. Joe privately confesses that he would sell his soul if the team could only capture the title, and naturally, the Devil shows up on cue to fulfill his wish. The rest of the show follows Joe as he propels his team to victory and enjoys all the spoils of celebrity status. Will he truly sell his soul for fame & fortune, or will he realize that his old life wasn’t so bad after all? You’ll have to come and see the show to find out!

My two younger sons, Luke and Elliot, and I auditioned back in July, and have been rehearsing diligently with the rest of the cast & crew since then. The final month was especially difficult. School started for my boys, and Luke made the starting quarterback position at CK Junior High. So, in addition to their daily homework, and football practice for Luke, both boys went to play practices every night from 6:30pm until 10-10:30pm. By time opening weekend arrived, their feet were dragging!

Both of them are involved in nearly all of the musical and dance numbers. I have several smaller walk-on roles and also play the Baseball Commissioner. Being involved in this production has been a great way for the 3 of us to connect and bond together. There are quite a few other families that are involved in the production as well. C-STOCK has a rich history and tradition of presenting quality family entertainment, and creating valued opportunities for kids and adults to develop their talents.

The show was reviewed this week by Michael Moore from the Kitsap Sun. Mr. Moore rarely has anything pleasant or encouraging to say about C-STOCK productions. And if he does, it’s usually just some obligatory remark to help make the more painful comments go down easier. Too many times, his barbs are aimed at things outside the control of the performers. We have a small, cramped theatre and not the best acoustics. The orchestra usually overpowers the vocals. We do the best we can with what we have. With such tight quarters, set changes are always challenging. It’s hard not to make noise during scenes. We simply do our best. And sorry, Mr. Moore, but we didn’t write the musical, so we can’t control the dialogue or the order of songs.

“Damn Yankees!” truly is great family entertainment, performed by families. It’s hard to find fun, enjoyable venues these days where you can take the entire family, without fear of questionable content.

From the opening number, ”Six Months,” and other notable favorites like ”Shoeless Joe,” “The Game,” and “Heart,” this show offers some really solid and endearing performances.

So grab the wife and kids, or make it a date night with your significant other, and run down to the Silverdale Community Center the next three weekends and root for the Senators!

Who: Central Stage Theatre of County Kitsap (CSTOCK)

What: “Damn Yankees!” a musical comedy by Jerry Ross, Richard Adler, George Abbot and Douglass Wallop

Where: CSTOCK playhouse, Silverdale Community Center, 9729 Silverdale Way NW, Silverdale, WA

When: Through Oct. 7; 7:30 p.m. Fridays and Saturdays, 6 p.m. Sundays

Tickets: $12 to $10 and available at the door or in advance at the Information Kiosk at Kitsap Mall.

For more information: (360) 692-9940, www.cstock.org

Bookmark this article to:

Comments (1)

Equity Acceleration Programs - Are they better for the borrower or the bank?

July 4, 2007 at 3:00 am · Filed under Bites of Buckwheat, Bremerton Real Estate, Silverdale Real Estate, Port Orchard Real Estate, Bainbridge Island Real Estate, Poulsbo Real Estate, Mortgage Bites, Bite Me Blogs, Gig Harbor Real Estate

This is America where the Need for Speed is ingrained from childhood. As children, we want faster bikes and faster Playstations. In our teen years, it’s faster cars and faster computers. And, as adults we want faster promotions, quicker increases in our credit limits and quicker pay raises. Eventually, we all have a day when we decide what we want more than anything else is Faster Equity Accumulation in our home!

The Good

Enter Equity Acceleration Programs. These programs are a masterpiece of marketing. They target the American need for speed promising to shave years off your mortgage and saving you tens of thousands of dollars in the meantime. Both of these goals are worthwhile. And there is nothing wrong with effective advertising. This article is not meant to imply that Equity Acceleration Programs are all bad. They are not all bad. They are poorly explained and even more poorly understood. As with many of the articles on SoundBiteBlog, this article’s intent is to explain the risks (yes, there are significant risks) and expose that the average consumer can accomplish the same goals in the same amount of time, for less money by avoiding the most heavily promoted Acceleration Programs available today. In short, the goals are worthy, the sales pitch is suspect.

The Bad

Equity Acceleration Programs are often explained in a misleading fashion. Rarely is a consumer told boldly that they are trading their nice, safe fixed rate first mortgage for an Adjustable Rate Line of Credit! The reason for this deception is obvious. It’s old news that interest rates are rising. It’s old news that they are expected to continue to rise in the near future. This old news causes anxiety in many borrowers and because of that anxiety, many loan originators are glossing over the part about an Adjustable Rate, preferring to concentrate most of their explanation on the exciting prospect of paying off a loan in a shorter period of time regardless of how it is done.

Fuzzy math seems to play a big part in an Equity Acceleration presentation. I have listened to two of these presentations in the last couple of months. The more aggressive presentation spent considerable time attempting to convince me that my (imaginary) 6.125% Fixed Rate Mortgage, was actually costing me 65%! My questions about interest rates vs. A.P.R. and how RESPA regulations affect us all, were quickly bypassed and never answered. Shock tactics are normal from what I can see.

The realities of these programs are these. You are going to trade your current mortgage (often an attractive fixed rate) for a new Line of Credit (also a mortgage) with an adjustable rate. You will then “deposit” your entire pay check into this “account” each pay period. Payment of all your normal bills is made from the “account” as you would normally pay them. Presto, abracadabra and your new mortgage will pay off years earlier than it would have! This mathematical magic was explained to me as follows. When you deposit your paycheck, you are temporarily reducing your mortgage balance. This temporary reduction reduces the amount of interest that is charged thereby making a drastic change in the overall amount of interest that accumulates on the loan.

The first flaw in the sales presentation for Equity Acceleration Programs is the fact they ignore how most of us pay our bills. Like my mother taught me to years ago, I pay my bills first on payday along with making my deposit to savings. The result of paying my bills immediately is that my new mortgage is only “temporarily reduced” for a very temporary time indeed. The amount of interest saved by reducing my mortgage balance by a few thousand dollars for 2 days is pretty insignificant. AND I had to trade my fixed rate mortgage for an adjustable rate to do it! The positive effect is more than offset by that fact as soon as interest rates rise and my new mortgage rises with them.

Another flaw is that because this is not an actual depository account, you will never be able to earn interest on your deposits. Remember, it’s a line of credit (a debt) not a savings account or a checking account that pays interest. Therefore, money that you could have accumulated by using the same theory with your existing accounts will be lost.

And the final flaw in these presentations becomes apparent when you consider how long it will take to recapture the cost of the new loan itself. You didn’t think these were loans without fees did you? No, like every other mortgage you have applied for, there are fees involved. Someone will need to appraise the home. Someone will need to do a Title Search and approve Title Insurance. And the list goes on. Each service includes a fee. All the normal mortgage fees will apply and they will add up to thousands of dollars. It will take a long time to save enough with the new mortgage to simply break even after these fees.

The Ugly

The biggest advantage to many Equity Acceleration Programs is to the Lender and the Loan Officer. Let’s be pragmatic for a moment. When was the last time you saw anyone advertising anything they were not going to profit from? These programs are no different. The Lender will be make a profit on each and every one and the Loan Originator will be paid for finding another client. There is nothing inherently wrong with that. Each time I have applied for a new mortgage, I knew that Loan Officer would get paid and the Lender would make a profit. Don’t forget, this is just another mortgage and it works like all the others. Loan Originators do not work for free. Lenders work for a profit. The market has gotten very difficult for Loan Originators and many are looking for new, creative ways to generate new loans. Lenders are rolling out “new” creative loan programs and dusting off old ones.

Caveat Emptor, “let the buyer beware”, is a phrase to keep in mind if you are tempted by a good sales pitch. Remember, you are buying a product. You may have just heard about the best product, or you may have just heard the best sales presentation.

The Do-It-Yourself Equity Accelaration Program

If you spend lots of time with a calculator in your hand like I do (occupational hazard), you get in the habit of running “What If” scenarios. It can be addicting to look at how much money we can save by tweaking the numbers in our personal finances. What if I move $2500 to this credit card account over here? What if I send an additional $125 each month in on my mortgage. What if I send that same $125 in on my car payment? You get the picture. This kind of thinking will drive some people to visions of Tequila and others chase the possibilities with all the fascination of a new video game.

What you will find running “What If” scenarios is that there are ways to shave years off your mortgage and save thousand of dollars without having to create a budjet that leaves you depressed for lack of fun money.

Here’s just one idea of many. Rather than opting for an Equity Acceleration Program that will cost you money, open a savings account or a checking account that pays interest. The last time I checked, Boeing Employees Credit Union was open to anyone living in Washington State and had a savings account that paid 5.5%. Now that makes all kinds of sense! Keep your nice, low interest rate, fixed rate mortgage alone. Open a high yield savings or checking account and follow the same principals as the Equity Programs. Deposit your paycheck into it and pay your bills out of it. Make some interest for yourself.

But don’t trade your fixed rate loan for an adjustable rate line of credit without understanding the risk you are taking. Very few Equity Acceleration Programs benefit the borrower as much as they benefit the Lender and the Loan Officer.

Bookmark this article to:

Comments (9)

Do you have trouble steering? Home Builders don’t !

March 17, 2007 at 3:00 am · Filed under Bites of Buckwheat, Real Estate Bites, Buyers, Mortgage Bites, Bite Me Blogs

There is a very questionable practice on the increase in WA Real Estate communities. Potential buyers of Condominiums, Manufactured Homes, Modular Homes and Stick-Built Homes are finding themselves in an uncomfortable position created by the seller. The discomfort occurs when the buyer finds that they will be penalized if they try to use a Realtor® or Lender of their own choice. This practice is called steering.

Unfortunately, at the moment, gray areas in the law and RESPA (Real Estate Settlement Procedures Act) are being abused by builders and developers intent on improving their profit at any cost.

Steering is the practice of guiding a potential buyer towards an affiliated or related Lender, Title Company or Insurance Company. Steering reduces a buyers access to fair representation. Many home buyers have an existing relationship with a Realtor® they trust, or a Loan Officer they trust. Yet, when the buyers attempts to pruchase the property of their dreams, they are confronted with the information that, if the do not use the builder’s chosen Real Estate Company or Lender, they may be penalized in the form of Higher Earnest Money requirements and additional pre-qualification demands.

An example of the deceptive way this begins.

If you are a buyer interested in one of the new Condominium projects in Downtown Bremerton WA, you will be forced to fill out a “Registration Form” before you can view any of the units. While there is nothing wrong with this in itself, what happens later is, at the very least, questionable. Should you decide that you would like to buy one of these condos, you will find that, in the Condominum’s view, you already agreed to use the Listing Agent as your representative! Not only that, if you insist on using your own Agent, your agent will be given a reduced commission. The last person I want representing me when I purchase property, is the Listing Agent. The Listing Agent is legally required to protect the seller’s interest. In my mind, there is no way an Agent can represent my best interests at the same time that Agent is protecting the seller.

An example of the pressure you can expect.

If you are a buyer looking at property in Port Orchard WA, and you decide to pursue the purchase of a home in one of the new develpments, you will have to agree to disclose all of your personal financial information to a Lender that the developer chooses. In other words, even if you walk into the office with a Pre-Approval Letter and Proof of Sufficient Funds to Close, this developer will insist that you cannot make an offer on the home unless you get pre-qualified by his Lender!

An example of the financial penalties to watch for.

If you are a buyer interested in one of King County’s new condo projects, you can expect to be informed that if you insist on using your own Lender, your Earnest Money Deposit will be increased by $5000! No, you didn’t mis-read that. This is currently happening to a member of my own family. This buyer is prepared to put up a normal Earnest Money deposit. She has $2500 set aside for just that purpose. That’s just not good enough for this condo development, unless the buyer uses the seller’s Lender. If the buyer is determined to use her own choice of Lenders, she must come up with $7500! Does that sound like a financial penalty to you? It did to this buyer. She was incensed and furious. The sellers response? “Other buyers haven’t had a problem with it”. This form of coersion is happening with increasing frequency at the moment. I think a more accurate response from the seller would be “We have forced others to do it this way, and we’ll force you too!”

These are not fictitious examples. Each of these situations has happened this year. They happened right here in Washington State. Your Realtor® did not gain your trust by accident. Your Realtor® gained your trust by proving to you he or she is worthy of it. The seller has not proven that you can trust them. On the contrary, didn’t the seller, by practicing these business techniques prove beyond a doubt, that you had better be very careful around them?

As a buyer, you have a right to representation of your choosing! You may have to fight for this right. Your Trusted Realtor® and Loan Officer are the people you can count on. Don’t let yourself be manipulated this way. Eventually, the government will put a stop to these practices. For now, you must protect yourself. And if a seller tries to tell you that these are acceptable practices, you may want to ask them why there is a current lawsuit in progress.

Bookmark this article to:

Comments (1)

Planned obsolescence in new home construction?

March 12, 2007 at 3:00 am · Filed under Bites of Buckwheat, Bites of Washington, Bites of Kitsap, Real Estate Bites, Buyers, Bite Me Blogs

The between-the-lines message in Mike Crowley’s statement in the Tacoma News Tribune appears to  be that new home construction is expected to fall apart in a few short years!

Wait a moment. Let me back up a bit and give you some details first.

• Mike Crowley is the executive vice president of the Master Builders Association of Pierce County.
• Senator Weinstein D-Mercer Island has proposed a bill; SB-5550 
• Senate Bill 5550 is a very simple bill which would make warranties mandatory on new home construction.
• Mike Crowley thinks this is a bad idea.

Mr. Crowley apparently made the following statement (as reported by the News Tribune) concerning the Senator’s bill:

“It’s one more thing that will raise the price of housing”

Senator Weinstein’s bill, SB-5550, if passed by the House, would require that new homes in Washington State be warranteed against the following ;

• any defects in materials or workmanship - 2years
• any defects in electrical, heating, plumbing, cooling and ventilating systems (with some exclusions) - 3 years
• defects leading to water penetration - 5 years
• any structural defects - 10 years

Unless I am missing something crucial here, the only way this bill can lead to any significant increase in the cost of New Home Construction is if these types of defects are common. After reading the bill through several times, I am impressed with it’s simplicity. This bill is designed with one purpose. It will give protection to consumers from builders of shoddy homes. None of the items in Senator Weinstein’s list is unreasonable.

If you are anything like me, you don’t expect your home to fall down in the first 10 years. If you are anything like me, you don’t expect it to spring water leaks in the first 5 years. And if you are anything like me, the other two items on SB-5550 seem to be reasonable expectations for the purchaser of a New Home. Clearly, Mr. Crowley is not like you and me!

Bookmark this article to:

Comments (4)

A reverse mortgage stole my inheritance

March 8, 2007 at 5:30 am · Filed under Bites of Buckwheat, Mortgage Bites, Bite Me Blogs

“But mom, you’re spending my inheritance!”

I was dumbfounded and shocked to hear my client’s daughter almost shout this at her mother in my office. I had to struggle to regain my professional demeanor. It took me several moments. The mother said nothing. The daughter sat back grumbling about her mother’s insensitivity with no apparent embarrassment. My client was in my office to apply for a Reverse Mortgage.

There is a curious and distasteful dynamic that sometimes happens when an elderly couple or individual attempts to get a reverse mortgage. A loan officer is often witness to the greedy side of human nature. The adult children of elderly parents can be cruel and grasping. They view reverse mortgages as something being stolen from them. They treat their own parents as the thieves.

I learned a long time ago that it is better to keep my mouth shut when my temper is up. And with my loan officer hat on, I don’t feel that I have the luxury of making remarks about a person’s personal set of values. So today, because this is my blog, I will use it to try and rid myself of the unpleasant aftertaste this meeting left in my mouth. With that in mind, here’s a piece of my mind.

The equity in a home does not belong to the heirs while the parents are alive. It may be a gift after they die; it may not be.  The equity in the house is something the parents worked for; not the children. The parents’ quality of life when they are elderly, is often reduced because of rising costs and falling incomes. Often, the only asset the parents have left to work with, is the home. The children can either support them now financially, hoping to get the house afterwards, or use a reverse mortgage to make life easier for everyone. The parents are often trying to not become a financial burden on their children. The parents are not trying to spend or give away anything, they are trying to survive with some small comforts.

It must be very difficult to maintain any sense of dignity while getting older with family members who behave this way. My client is a nice, older lady with clean clothes that are not new. She smells of soap. Her grooming is tidy but there is no hint of makeup or hair color. I doubt she can afford those things. She has a soft voice and soft hands. Her husband is gone. She gazes at the floor alot.

My client brought me cookies today and stated “You’re a nice young man.” I grinned at her, I’m 48. We chatted about her garden and the gardener’s spring ritual. She said she would bring me some bulbs she needs to divide this year. We did not speak of her daughter’s outburst. My client has decided not to pursue a reverse mortgage.

Writing can be therapeutic. But this time, I know that the visitors who would benefit the most from this article, are the ones least likely to finish reading it. Sometimes I don’t like my job very much.

Bookmark this article to: