Far Out From Mainstream
It never ceases to amaze me... I'm catching up on my readings, as I do on a daily basis, and if by chance I can lend a helping hand and give my two cents of advice to spark the creativity of another, I will - in good intent!
Then you happen upon reading words and advice that let you know exactly how far "out there" you really are. Being one who has a hard time following in the footsteps of others and being told numerous times that it can't be done... I'm here to tell you - It can be done!
On the subject of submitting an offer through a Realtor, with the use of submitting earnest money, I actually read these words from a self proclaimed "Financial Expert" in the mortgage industry.
Please remember these are not my words - they are a quote from a "Financial Expert" in the Mortgage Business.
"Remember not to make a fool out of yourself by asking for rediculous terms. Remember the more far out you get from mainstream finance, the trickier, costlier and more involved it will be to do just one deal."
Read it again. I can't help but disagree with this statement to the furthest degree. Now, I'm not a "Financial Expert". I'm a proud self-proclaimed Creative Real Estate Investor! I also happen to be a Formerly Licensed Realtor and Loan Officer. I've got the basics and the gest of the two industries that go hand in hand.
Not once have I ever paid more than the Appraised Vaule for a property. Not One Time!
If I were to have used Mainstream Financing, It would be costly. What are all those fees they charge all about any way? Making Money! Charged to the borrower! Go to the table and find out the rate got bumped by an 1/8th or 1/4 point... because they want a back end bonus from the lender...they tell you they couldn't get it locked in on time. Doc fees, Points, etc... You've been there!
A phrase like that is Powerful if you think about...
For the general public and the retail dollar, I say go for it... create more deals for me and the other Creative Real Estate Investors. Loan full value Plus 3 tp 6% in fees. I can Pick up on a L/O or Sub 2 or Short Sale... In time... Overlend, overcharge and stack up the fees. REO's - Foreclosures.
I will stick to my simplistic no fees, no hassle, way of Creative Financing and Terms that make me money.
I don't know about youself, but I intent to keep an open and Creative mind about Real Estate Investing and not be told how it's gonna be....
Invest Creatively...
Dave
Michael Milken singlehandedly remade the U.S. market for corporate bonds (before engaging in the corruption that rightly brought him down). If you have even 1% of his creativity, you can run rings around the realtors and lenders who know only how to color inside the lines--without doing anything illegal, immoral or even financially dangerous.
It's just a question of identifying which interests are key to the other party in the transaction and how they can dovetail with your own (or someone else's who will be involved in the deal).
Not everybody is well-served by the list-with-a-realtor and the-buyer-marches-down-to-his-bank-and-gets-a-conventional-loan buying/selling process.
Good realtors and mortgage brokers know this, and realize that they provide an important service that not everyone needs in every transaction. They're ready to serve when needed and don't try to hog the limelight when they're not.
The other ones will have a lot to say about anyone doing anything by a method that doesn't put cash in their own pockets.
Michael Milken was a financial genius. He had a lot of great ideas, which were profitable for a lto of people adn himself. He went too far when he violated teh securities insider trading laws. But I agree, one could learn a lot from his approach to solving financial problems, and funding needs. Just remember to do within the legal guidelines.
Michael Milken was a financial genius. The darling of Wall Street. He helped put many megabuck deals together. He virtually invented the use of "junk bonds" to fund new enterprises. His fall was tragic. He now spends his time doing philentropic work.
Most loan agents have minimal training. You can learn to fill out a 1003 in a couple of hours. The new integrated software makes process very simple. I don't know of any mortgage agents (I'm sure there are some) who have a real grasp of creative real estate. To most of them that's an 80/20 deal.
Milken,
Interesting man. He failed because he refused to accept advice. He was told by the greatest Accountant in all Christindom, to cool it and stop spouting all over the place. He was told where was the line, and not to cross. But he had a lot of contempt for the "little people" The only problem was that after a few insults, the little people left and those that remained were into an ego trip that we have not seen since Sammy Insull, played his little oil game so many years ago. I am always amused how saint like people get as they leave the Joint for civilian life. As if it will all balance out. A few good deeds, get rid of the bad hairpiece and all will come right.
The problem of Real Estate Brokers and Mortgage Brokers is that they get into patterns and they hate to break out. Also they hate to inform you of any deviations that are possible from quoted prices and conditions.
Inasmuch as I fit both the above job descriptions, I view them in the following relationships.
Real Estate Broker, thats your BA degree you notice I did not use BS. Mortgage Broker that is a MA degree. Real Estate Investor, now that is your PhD.
I know most of you talented types went direct. You followed "Good Will Hunting" and went to the library and got educated. I hate it when you show up in bars and beat me out of my pickup attempts.
The true essence of Real Estate Investing is to put your mind in the receptive mode, and listen and observe, then make your plans and efforts based on true present time information and observation.
I had an architect noh builder come to me some years ago who had been turned down by every bank and mortgage company in town. The guy was fantastic, had a feel for woody designs. Wanted to build for a client a restaurant on Sunset Blvd.
I loved the plans, but when I asked all over town nada reception. Soooo, I went down on Wilshire Blvd to a little private investment company nammed S----. I showed them the plans, the appraisal of the area, the study I made of the project. They took my one point commission away from me but I got the loan and it was built and was beautiful. Frankly if the prior Mortgage Broker would have been willing to lose the one point commission the deal could have been done.
Sounds like commonsense. It is, but you have to look beyond the so called rules. And thats why all the rulers in my one man office are made of steel, so they will bend.
The End.
Cheers Lucius
With regards to being made of steel;
I lived the american dream of becoming a business success, having the big house, and the wife and kids. Then due to ignorance I lost it all. The house , the business, the wife, and worse the kids. I was a mortgage/investor pro and then got killed career wise because I believed all the rules that we learned to live by in school. In others words I played by the book. The problem is that the book was made by those with other motives. I went through unholy hell in my past , so I can say from experience to all you wanna be types that there are only the rules you accept, not those they give to you. I do not accept what Milken did but I do not condem him either. Be made of steel for yourself ( and God ) alone but bend for no one else. Thank you.
Ivan
Dear Ivan,
In my book you did not loose. You are merely on a plateau. I await your next move. Perhaps the prior slid was a necessary learning experience. Hurts, but wot the hell thats life. Just don't get bitter, as to Mr. Milken, prior to his fall when he was the winner of all time, he was very arogant, sort of had a put down to everybody he met. Not necessary. He recognized the true value of junk bond issues. What he did is now in common usage, they just do not publish it as much.
There was another genius about that time who went to jail for insurance fraud. He invented the one premium life insurance policy. Well he got out, and guess what California gave him back his insurance license. Not too expensive either. Ah life in the modern day. I do enjoy this mercantile society, and, I think you do toooo.
Cheers Lucius
This forum is becoming a pissing contest and it is becoming boring and an ego contest. College, degrees, etc, lets stick to the topic coys and girls!!!!! Who needs to know about pickups in bars any ways? We are trying to learn. I have a lot of money to invest and not one of you so far has interested me one bit. Is there any one out there that is legal and serious?
I hear ya. Remember you can moderate the topics in this forum by selecting the pulldown menu that is next to every post and clicking the 'moderate' button at the bottom.
The flames, and offtopic posts will drop off the page.