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   ARTICLE   |   From Scotsman Guide Residential Edition   |   February 2005

There Still is Hope

Remember when you used to be able to open the white pages, close your eyes, point to a phone number, and by the time you opened your eyes, another loan was added to your pipeline? Well, with the evil invention of the do-not-call list combined with the slight rise in interest rates in the last six months, those days are long gone. Loan officers are left with an empty feeling in their stomachs and Monster.com permanently added to their favorites list. Those who just simply love the business and are willing to go through the hard times are left scrambling to find the best leads money can buy or hoping their real estate agent comes through this month.

First, here’s the bad news. There are no truly good leads that will save your career, and the purchase market itself is going through a slump. So, you try marketing. You come up with a one-ofa-kind idea that will bring in so many incoming calls you might have to hire another loan officer. Exciting, right? Until you search the Internet and find a hundred other loan officers doing the same thing. And then, you drive home to find six creatively marketed letters in your mailbox telling you to refinance at low rates. You know this can be a great business, but where are the answers? What will help you pay the bills?

Here’s the good news. Only you and your hard work will pay the bills. Right now, you’re the broker who can do it all: prime, subprime, super subprime, and anything that any other broker can’t do. Here’s a trick I learned years ago: Learn to say “no” and get a niche. That niche is your key to success in the mortgage business. Rise above the competition and give your clients

something unique. Teach them how to make money. That’s your niche.

About a year ago, I ran into a real estate agent in California. He sells houses in Bakersfield and Fresno, two of the top nine cities with the highest house-price growth in the country. This past fall, they grew 31 percent and 29 percent respectively, and demand says they will stay near that pace this year. For his clients, a real estate agent finds houses in those cities, then rents them out and even manages the property. The buyers only have to come up with financing for this great investment opportunity.

This is where you come in. Any real estate investor, savvy or not, knows about the fortunes made in California real estate. They just don’t know where to begin, and it’s up to you to show them. You find the client and the financing, and a real estate agent will do the rest. And the best part is that your client will need minimal cash out of his/her pocket to get into this investment. There are lenders out there that will do 100 percent investment financing with a 660 score and 95 percent investment no doc with a 680 score.

Here’s a scenario to sell. Seven months ago, one of my clients bought a house in Bakersfield for $163,000. Before he signed the papers, it was rented. With 5 percent down and the sellers paying for closing costs, my investor paid only $8,150. Today, the house is still rented, and he could sell it for at least $220,000. That’s an investment that gained 453 percent in seven months! And my client never even had to go out to California. The house was found for him, the renter was found for him, and he closed here in Michigan.

I know you can sell that. It’s a great niche. Your clients will really appreciate you, and you will get a ton of referrals. Remember, it’s OK to go out on a limb; that’s where the fruit is.


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