Cash is King – Upside Down Mortgage Solutions

April 24, 2008

3 Signs the California Real Estate Market Has Hit Bottom!

In a Real Estate market such as this most people think that the doom and gloom will last forever.  The Media puts the permanent spin on things and wants the average person to buy into an upside down Real Estate market and the Media is often 60 days late on most information.

I have 3 charts that will show the basics of a Real Estate Market focusing on the Sacramento, CA area but this information can be used across the US as California has been hit the hardest.

Sacramento Real Estate Number CHART HEREwaynes-4-9-08

  1. Chart #1 Market Dynamics: Supply & Demand- The sheer volume of open escrows month over month for the first part of 2008 has really shown had an impact on home prices.  Ask an active Real Estate Agent and you will find that most properties have multiple offers and are going for more than the listed price.  March has shows you that 2944 homes were put into contract and that we should expect the number of closed transactions in the month of April to skyrocket. 
  2. Chart #2 Market Dynamics: Median Price (sold)- January of 2008 was the obvious bottom of the market in the Sacramento, CA area for Real Estate.  You can see how the average price of a home from January to March of 2008 has risen showing strength in the market and the exact increase isn’t represented here but we can see that it was significant.  Chart #1 supports this with an increasing level of volume (demand).
  3. Chart #3 Market Dynamics: Months Supply of Inventory- I think this graph is telling as it goes to prove that demand is up and supply is decreasing.  With only 4 months supply available in March we can expect home prices to increase if we don’t have an influx of new REO homes to keep prices the same.

I always get asked if this is a good time to buy and I tell people a variety of answers based upon what they plan on doing with their properties.  Investors, step it up, now is your opportunity but be prepared to find financing (traditionally speaking) harder to come by these days.  Move up buyers, You can find a steal of a deal out there in this market, high priced home sellers are desperate but bring on your cash because financing can be challenging here too!  First time homebuyers, this is the market you dream of, financing is out there and focused on your segment of buyer.  

By trade I do loans and help many people find solutions to their financing needs.  I can help with a variety of topic so feel free to contact me at


April 17, 2008

Stop Foreclosure: Filing Chapter 13 Bankruptcy may help.

Before you dive in and read to information below I want to share a few things with you.

This post has been up here a while and in that time I have found an even better way to provide information to those people facing foreclosure.  

After you have read through this article you will need more help!  To get that help read this EBook and you will be well on your way to making the best decisions possible.

In bankruptcy Chapter 13 mortgage foreclosure is either stopped or at least temporarily avoided. Here’s how.

First, just in case you are not familiar with a Chapter 13 bankruptcy, it is a bankruptcy court approved payment plan where the debtor (the person filing bankruptcy) pays a bankruptcy trustee each month and then the trustee pays the debtor’s creditors.

There are several aspects of a Chapter 13 bankruptcy that work to help people facing mortgage foreclosure. The first aspect is actually applicable to all bankruptcies. It is called the “automatic stay”.

By law, whenever anyone files bankruptcy, regardless of the type of bankruptcy, there is an immediate “automatic stay” (automatic temporary stopping) of most civil proceedings against the person filing bankruptcy. What this means is that if someone is facing mortgage foreclosure and the person files bankruptcy, the mortgage lender has to immediately stop its’ foreclosure action until it gets permission for the bankruptcy court to proceed.

In a Chapter 13, the bankruptcy court will not lift the “automatic stay” and grant the mortgage lender permission to proceed with a foreclosure until the debtor (the person filing bankruptcy) fails to make his payments to the bankruptcy trustee. As long as the debtor pays the monthly payments to the trustee and pays his regular mortgage payments, the “automatic stay” will remain in force and the mortgage lender can not do anything.

The second aspect of a Chapter 13 that works in favor of people facing foreclosure is that it allows a debtor to pay mortgage arrearage over time, normally 3 to 5 years. In most foreclosure cases, a person has not paid his monthly mortgage payment for several months and the mortgage lender demands full payment of the delinquent monthly payments (arrearage) in lump sum before the lender will consider stopping foreclosure. Most people cannot pay the lump sum.

In a Chapter 13 bankruptcy, a debtor can pay the arrearage over time. He does not have to pay it all at one time. Spreading the lump sum over time means paying smaller monthly payments until the total arrearage is paid. A creditor can object to the amount to be paid each month towards the arrearage, but once the bankruptcy court approves the payment plan, the creditor can not do anything except take the payments.

A third aspect of a Chapter 13 bankruptcy that helps people facing mortgage foreclosure is that unsecured creditors may be paid a portion or all of what is owed to them. What this is really doing is reducing the amount of debt that a person has to pay back each month. By paying unsecured creditors less each month, there is more money available with which to pay a secured creditor such as a mortgage lender. Therefore, it should be easier for a debtor to pay his monthly mortgage payment.

This is general information. If you need specific information or have any questions of any nature whatsoever, talk with a lawyer licensed in your state.


 “Refinancing SECRETS for an Upside Down Loan that Banks Don’t Want You To Know because it will Cost them THOUSANDS of Dollars!”

JUST SEND ME AN EMAIL with “Refi Secrets for Upside Down Loans!” as the subject to

Stop! Did you know that bankruptcy was created to give people a fresh start? Find out more at bankruptcy information. And click here for more insights on Chapter 13 bankruptcy.

April 6, 2008

Upside Down Mortgage:Getting Your Bank to Work with You

Listen in on a Interview I did on Loan Modifications and the

Fannie Mae and Freddie Mac Streamline Loan Modification Program


See my New Post

Refinancing Upside Down Mortgage

“Refinancing SECRETS for an Upside Down Home Loan that Banks Don’t Want You To Know because it will Cost them THOUSANDS of Dollars!”

Follow the Link here “Refi Secrets for Upside Down Loans!” 

It is estimated that 1 in 10 homeowners with mortgages are upside down in their homes, as of March, 2008.

As alarming as that is, the projection is that as home values continue to plummet, 1 in 3 home owners will be upside down by the end of this year, 2008. Let me just take a moment to explain exactly what I mean when I say upside down. It means that you owe more than your home is worth. Another term for this situation is “underwater.”

A good example would be a friend of mine who has a house he built in Tampa, Florida, and has just moved into it from Long Island, NY. He owes $295,000 on it and the builder is now selling similar houses for $185,000. My friend is seriously underwater.

Not only that, his mortgage will adjust in a year to a number that will probably push him into foreclosure. He no longer wants the house. What he doesn’t know, is that neither does the bank! They do not want a house that is worth less than the financing on it sitting on their books.

Loss Mitigation can be his solution.

This is the process of mitigating or lessening the losses associated with assets, in this case homes.

It is a department in a bank and it is also the process of negotiating a solution that will mitigate losses for both the bank and the homeowner, typically allowing him to stay in the house so that it does not drag down the bank’s balance sheet.

Could my friend negotiate his own loss mitigation deal? Yes, he could also remove his own appendix, but the outcome in both cases would probably be disaster. Were he to call the bank, he would be ill prepared for what he will likely encounter.

First, he will have difficulty finding the right person to help him.

Second, if he eventually stumbled upon the loss mitigation department, they would probably not talk to him because he is not delinquent or in foreclosure and he would not get anywhere.

His best chance is to be represented by a loss mitigation professional negotiator.

This is someone, usually a former banking insider or mortgage broker, who is now working on the other side of the desk, helping those who are in trouble with their loans. He will know where the bodies are buried in the bank and will be familiar in many cases with the specific personnel in the bank’s loss mit department.

If the homeowner can show that his DTI, Debt to Income ratio, is under 50% now, and he has proved that he can make his present payments but would go to a 60% or higher DTI upon the reset of the loan; the loss mitigator is in a good position to negotiate a loan modification that would recast the loan without the scheduled increase.

Although the homeowner’s DTI is simply calculated by dividing his income by his total monthly debt load, the homeowner may include or exclude items or report them in a manner that will quickly get his proposal shot down by the bank.

Say he is paid weekly, bringing home $1,000/wk. He puts his monthly income down as $4,000/Mo.

In reality, there are 4.3 weeks in a month, so he is short changing himself by $300/mo. Not a big deal?

What about something as simple as reporting the cost of food for a family of four, for instance? The homeowner may report their actual figure of say, $800 month. He has no way of knowing that the bank is satisfied with a pro forma, $100/person/month figure for food. So now, he has short changed his income by $300/mo and overstated his expenses by $400/mo. Such a net swing of $700 month could easily push his DTI into the rejection zone.

The loss mitigator, on the other hand speaks the bank’s language, knows and understands their criteria and procedures, allowing him to help the homeowner tailor his situation to satisfactorily meet them.

The alternative to the bank is not a positive one.

The homeowner stops paying. They bring a foreclosure. The house does not sell at auction so they have to continue it on their books as a non performing asset which is a black mark on their finances.

It has been observed that the total cost to the bank to take a house back, in terms of lost interest payments, legal fees, administrative fees, maintenance, repairs, taxes, insurance, broker fees, etc; including the loss on the house when it is eventually dumped on the market at a fire sale price, could easily total $50,000 or more!

It just makes more dollars and sense to have the homeowner in the house, making payments he can afford while keeping a non performing loan off their books. That is the outcome of a successful loss mitigation.



Copyright 2008 Bill Young
Bill is the Director of a nationwide loss mitigation network. If you are a real estate professional looking to augment or replace your regular income, the loss mitigation industry could be your answer. More information Click here: http://Loss-Mitigation.Info or call Bill at 646-961-3818

November 6, 2006

Simple Credit Questions and Answers to Improve your Score

It’s always good to share the information you have with anyone who needs it because you may never know the impact you have on their lives.  Here are some questions and answers to some very common credit inquiries.

 A Client wrote:

 Hey Brent!  Hope all is going well.  I have a credit question and-thought you’d be able to help on my quest to better my credit scores.  On the credit report/scores that I obtained on-line – the
suggestions to improving your credit scores section – it suggests that I open
another account(credit card).
        Question 1:
        Is it bad to pay off a small credit card of $300 with another credit card?
        Question 2:
        Will opening another credit card increase my credit scores only if there
        are major purchases and then I pay them off immediately?
        Question 3

        Is it bad to keep the $300 credit card open with no activity?

Appreciate any assistance or if you of know of a website that will talk more about credit do and don’t.  Happy Holidays to you!! See you in the Spring.

My Answer:

I can help you with your questions.

#1.  It’s never bad to pay off a credit card unless the account is a
collection account or charge off or anything of that type.  If you want
to pay a card off of that type be sure to know that it will have a
negative effect of the credit.

#2.  If you open a new card and it reports to the credit bureau then you
are in better credit shape.  You don’t have to make any purchases to
have an immediate bump in credit score BUT if you go out and use it all
it will bring down your scores lower than before.  Rule of thumb- keep
credit usage to 30% of balances or if you have a $1000 credit limit keep
the balance under $300 unless you plan to pay it off immediately.

#3.  No activity has a little to do with decreased scores but know this,
limiting usage is a good thing because you are controlling your spending.
Use it from time to time but do what is comfortable.  If you let it sit
there for a very long time then the company could discontinue you line
of credit.

I have a detailed book that I will send you going over all aspects of
credit and how to best use it and I will send you a CD with this
information as well.

I hope things are going well and I let me know if you have more

Be in Touch!

Brent Lane

It’s important to have all your questions answered so you know what to expect as you make changes to your credit because any change can show up in your score either good or bad.  I just want to be sure it’s good! 

To get your copy of my Credit Workbook please email me with your address and I would be happy to send it to you, unfortunately it only comes in hard copy.  Also if you have anything to add, ask or delete please feel free to leave a comment.

October 17, 2006

Help! I’m Getting Divorced! What About our Credit?

When a marriage ends in divorce, the lives of those involved are changed forever. During this time of upheaval, one thing that shouldn’t have to change is the credit status you’ve worked so hard to achieve. Unfortunately, for many, the experience is the exact opposite. Unfulfilled promises to pay bills, the maxing out of credit cards, and a total breakdown in communication frequently lead to the annihilation of at least one spouse’s credit. Depending upon how finances are structured, it can sometimes have a negative impact on both parties.

The good news is it doesn’t have to be this way. By taking a proactive approach and creating a specific plan to maintain one’s credit status, anyone can ensure that “starting over” doesn’t have to mean rebuilding credit. The first step for anyone going through a divorce is to obtain copies of your credit report from the 3 major agencies: Equifax, Experian®, and TransUnion®. It’s impossible to formulate a plan without having a complete understanding of the situation. (Once a year, you may obtain a free credit report by visiting 

Once you’ve gathered the facts, you can begin to address what’s most important. Create a spreadsheet, and list all of the accounts that are currently open. For each entry, fill in columns with the following information: creditor name, contact number, the account number, type of account (e.g. credit card, car loan, etc.), account status (e.g. current, past due), account balance, minimum monthly payment amount, and who is vested in the account (joint/individual/authorized signer). Now that you have this information at your fingertips, it’s time to make a plan.  There are two types of credit accounts, and each is handled differently during a divorce.

The first type is a secured account, meaning it’s attached to an asset. The most common secured accounts are car loans and home mortgages. The second type is an unsecured account. These accounts are typically credit cards and charge cards, and they have no assets attached. When it comes to a secured account, your best option is to sell the asset. This way the loan is paid off and your name is no longer attached. The next best option is to refinance the loan. In other words, one spouse buys out the other. This only works, however, if the purchasing spouse can qualify for a loan by themselves and can assume payments on their own. Your last option is to keep your name on the loan. This is the most risky option because if you’re not the one making the payment, your credit is truly vulnerable. If you decide to keep your name on the loan, make sure your name is also kept on the title. The worst case scenario is being stuck paying for something that you do not legally own.  In the case of a mortgage, enlisting the aid of a qualified mortgage professional is extremely important. (I might know one of those) This individual will review your existing home loan along with the equity you’ve built up and help you to determine the best course of action. 

When it comes to unsecured accounts, you will need to act quickly. It’s important to know which spouse (if not both) is vested. If you are merely a signer on the account, have your name removed immediately. If you are the vested party and your spouse is a signer, have their name removed. Any joint accounts (both parties vested) that do not carry a balance should be closed immediately.  If there are jointly vested accounts which carry a balance, your best option is to have them frozen. This will ensure that no future charges can be made to the accounts. When an account is frozen, however, it is frozen for both parties. If you do not have any credit cards in your name, it is recommended you obtain one before freezing all of your jointly vested accounts. By having a card in your own name, you now have the option of transferring any joint balances into your account, guaranteeing they’ll get paid. 

Ensuring payment on a debt which carries your name is paramount when it comes to preserving credit. Keep in mind that one 30-day late payment can drop your credit score as much as 75 points. It is also important to know that a divorce decree does not override any agreement you have with a creditor. So, regardless of which spouse is ordered to pay by the judge, not doing so will affect the credit score of both parties. The message here is to not only eliminate all joint accounts, but to do it quickly. 

Divorce is difficult for everyone involved. By taking these steps, you can ensure that your credit remains intact.  If you need some further assistance, I am here to help.  You can email me at and apply for a loan at  See what others are saying about me here.

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