If you have a beef with a broker ... if your broker does a lousy job that fails to meet the baseline standards for licensed professionals ... who do you call?

The usual and traditional answer is that you pick up the phone or send a letter to state or provincial regulators. They can investigate the matter, obtain books, papers and testimony, and if they find wrong-doing fine a broker or suspend or terminate a license.

This is serious stuff because a broker without a license is a broker without a livelihood.

Given that a real estate transaction is a major life decision, it follows that the rules related to brokerage should be both clear and enforceable. In the case of real estate there is a substantial body of laws, regulations, court decisions and ethical standards which govern the field. Brokers, in turn, should know what the standards are and the rules should apply equally to all licensees.

With this background in mind, the federal agencies that regulate national banks are now seeking to define real estate brokerage as an "activity" which is financial in nature, incidental to financial activities, or that complements a financial activity. In other words, real estate brokerage is simply another service bankers should be able to offer.

The definition of banking under the Gramm-Leach-Bliley Financial Services Modernization Act of 1999 is so broad that it seems to include every event where money is exchanged. After all, is not buying a car a "financial activity"? What about the purchase of balloons, soap or lemonade?

For consumers the issue is different. If national banks are allowed to provide real estate services under the authority of federal regulators, it means that state laws will be preempted. A national bank need not match the standards required of state-licensed brokers and salespeople. In effect, there would two sets of real estate regulation, one for national banks and a second for all other brokers.

The ability of banks to offer real estate brokerage services also means something else. If consumers have a complaint or problem with a broker, where do they go? Today they can go to nearby state regulators and if those regulators are not responsive they can make their feelings known to state officials, politicians who would like to stay elected.

But with national banks in real estate the complaint process would be different: A consumer with a beef would have to go to un-elected federal regulators in Washington, a place where access and satisfaction by individual consumers without substantial PAC money is hardly assured. Even the Federal Trade Commission, the huge agency that's supposed to protect the public against unfair business practices; is literally barred from examining bank abuses. As the Federal Reserve Bank of New York explains, the "enforcement of federal consumer regulations is generally left to the FTC when the institution is not a federally insured depository institution." That's scarcely a good omen for a consumers.

The Association of Real Estate License Law Officials (ARELLO) issued a statement last week opposing the expansion of national banks into real estate brokerage. This is not a narrow matter of turf and territory, rather at its core it concerns the right of consumers to hold local politicians responsible for the acts of regulators and thus the regulators themselves.

To this point Congress has prevented federal regulators from expanding national bank powers, but this is a matter needs to be finally resolved.

Buying and selling residential real estate is typically the most significant economic event we each experience. Everyone should be able to deal with local real estate brokers with the assurance that if something goes wrong, if the broker is at fault, consumers will not have to look far for satisfaction and remedies. That's a standard that cannot be met by bureaucrats a thousand miles away.

STATEMENT ON OCC OPINIONS EXPANDING AUTHORITY OF BANKS TO DEVELOP REAL ESTATE

The Association of Real Estate License Law Officials (ARELLO) comprises real estate regulators from U.S. states, the District of Columbia, Puerto Rico, Guam, and the Virgin Islands, as well as numerous countries and territories on almost every continent in the world. Our mission is to support regulatory agencies in the administration and enforcement of real estate license laws put in place to protect the public interest.

In December 2005, the U.S. Office of the Comptroller of the Currency (OCC) issued legal opinions that gave one national bank the authority to build a luxury hotel and gave another the authority to build a multi-use project that includes office and retail space, a hotel, and residential condominiums to be sold to make the remainder of the project economically feasible. ARELLO is concerned that expanding the authority of banks to develop real estate could lead to banks being given authority to broker their own properties and, as the next step, being given authority to broker real estate for others. If that happens, it will place the regulatory structure of the state-regulated real estate industry at risk.

The extremely broad preemption authority asserted by the OCC in its 2004 regulations could permit banks and their operating subsidiaries to broker real estate without having to become licensed under, or otherwise comply with, state/territory real estate law. These laws, administered by our members, regulate real estate transactions in every jurisdiction, provide for licensing of qualified real estate brokers and agents, and protect consumers. These laws authorize real estate regulatory agencies in each state and territory to monitor their licensees and investigate allegations of illegal or fraudulent real estate practices.

As we explained in our statement issued in May 2004 about our concerns about potential preemption of state and territorial real estate laws:

Any federal legislation or regulation which exempts national banks from the jurisdiction of state real estate licensing authorities is directly threatening to the integrity of the real estate transaction process, to the detriment of the individual buyer and seller to the consumer.

ARELLO believes the OCC should take no action that would give banks authority that could result in preemption of state and territorial laws under which real estate consumers are protected.

Adopted by majority vote of the ARELLO Board of Directors April 8, 2006
posted by Rick at 4/19/2006 01:43:00 AM

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Tuesday, April 18, 2006 4/18/2006 08:08:00 PM

It's a Bird, It’s a Plane, It’s a Realtor?

A few forward thinking Realtors are using the wow factor of being transformed into a superhero character as a smart and effective way to market themselves.

(PRWEB) April 18, 2006 -- In Arizona for instance, a Reality Estate "Pilot" soars above the desert in a Sopwith Camel emblazoned with her company name. In Tennessee, another Realtor flies - without an airplane mind you - above the Nashville skyline carrying a residential home in his hand. How is that for conveying the fact that you can really "Move Property"?

Since opening their doors in mid 2005, ShowOffCards.com has been helping Realtors (and insurance reps, and charities and builders and more) Be Unforgettable.

So where do these larger than life business card concepts originate? According to Scott Jones who is the ShowOffCards.com founder and CSO (Chief Show Officer), "Sometimes, after browsing the ShowOffCards.com gallery, the client may be inspired with their own unique Show-Off idea but in most cases they rely on the somewhat twisted creative team at ShowOffCards.com to come up with several concepts from which to choose. During the on-line sign up process the client completes a short questionnaire that helps the ShowOff team get a direction for their concepts.

The fully customized superhero illustration on the front of the Show Off Business Card typically shows the client in hyper muscled and/or super sized proportions in a setting appropriate to their line of work. A custom homebuilder wielding a screw gun like an assassin’s pistol emerging from a construction site labyrinth or a "James Bond" style Realtor standing in front of a SOLD sign holding a phone with one hand, and of course a martini glass in the other. ShowOffCards can create an illustration as wild (or as mild) as you desire.

At some point in everyone's life they secretly wished that they could be an illustrated character of some sort. It may have been Spiderman swinging through the New York skyline or Cinderella dancing with the Prince but these types of illustrations always evokes smiles.

Once the superhero illustration on the front of a ShowOffCard grabs the recipient’s attention and burns your superhero image into their memory bank it's time to turn the card over and get personal. In addition to a headshot and traditional contact information, the back of a ShowOffCard can include a few personal tidbits such as pets, hobbies, hometown, favorite quote or basically anything you want to share that will make you more approachable and "real".

According to the Chief Show Officer "Handing out a ShowOffCard is always exciting because the cards never fail to elicit a reaction. You may get a smile, a laugh or in rare instances, stunned silence, but you just became unforgettable and that is the ultimate goal of any marketing campaign."

Brandon Wiegand, ShowOffCards client and "Solutions Superhero" confirms the effectiveness of ShowOffCards. "Every single person I have given my Show Off Business Card to can't help but laugh or chuckle or make some sort of comment about it. Most importantly, when I meet them again for a follow up appointment, they still have my card (usually in a prominent location on their desk) and remember me because of it."

Wiegand goes on to say that "After clients read my "Vital Statistics" it is usually much easier to find a common point of interest. Through my Show Off Business Card and the use of humor I have been able to make more of a personal connection, even though I have not been doing or saying anything differently."

posted by Rick at 4/18/2006 08:08:00 PM

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4/18/2006 01:16:00 AM

Buying Your First Home??

There are few things as rewarding as buying your first home. The sense of pride you feel can be enormous. When you make the decision to go from renting to owning, you are taking a step in the right direction. Home ownership can offer tax benefits, freedom to make decisions about your home, and investment benefits.

There are some benefits to renting; such as, short-term obligation, no commitment to maintenance, and no responsibility to other financial costs associated with ownership. But renting should be viewed as a temporary lifestyle. There are no long-term financial gains to renting. In some cases, monthly mortgage payments can be as low as renting. And by owning, you have an investment you can use as collateral.

Homes appreciate in value, especially in steadily growing communities. And, you can actually reduce your house payment when interest rates fall, by refinancing. You can't say that about renting! In fact you can count on your rent increasing annually and in some cases semi-annually.

Home ownership is a highly leveraged investment that can yield substantial profit on a nominal front-end investment. However, there can be costs incurred in ownership versus renting. Such as the down payment, maintenance costs and yearly tax payments. But again, these costs are being applied to an investment. At the end of the day, if you rent, you pay until your lease ends with nothing to sell. In ownership, the money you spend goes towards your profits from appreciation in the value of your home.

Did you ever wonder how some people afford such expensive homes? Chances are that may be their second, third, or even fourth home! Don't be discouraged if you can't afford the house you want the first time you buy. Make sure the area is right and you buy a house that fits your needs and budget. Buying at or below your price range allows you to use the extra money to do home improvements. Then in a few years time you can put the house up for sale, sometimes at a ten to thirty percent profit. You can then take that profit and put it towards your next home -- bigger, newer and so on.

As for evaluating the risk in buying a home, do your homework. Take some time to investigate the communities you are interested in, at least a few months in advance to buying. Make sure you look at the growth of residential and commercial building. Look into the school systems to make sure they are right for your children. By spending time in your desired communities before hand, you can make an informed decision regarding whether or not the community is right for you and your family. Don't make the mistake of buying in an area where the housing and property are more expensive in hopes of increasing your profit. More money spent on a property up front does not guarantee you an increase in property value over less expensive communities. Don't be in a hurry to just buy a house. Buy the right house; remember you may be there a very long time. By utilizing your real estate agent's expertise and experience, you can find the house that is perfect for you.

posted by Rick at 4/18/2006 01:16:00 AM

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Monday, April 17, 2006 4/17/2006 09:27:00 PM

Typical Closing Costs

Closing costs are the expenses associated with buying reality. You'll pay a large chunk of the closing costs the day the trasaction is complete, when the property becomes yours, but some closing costs are nearly always paid before that day.
Even though your downpayment might be a high percentage of the funds you bring to closing it is not regarded as a closing cost. It's a payment that increases the equity in your home, not an expense.

The Real Estate Procedures Closing Act, RESPA, requires lenders and mortgage brokers to give you a Good Faith Estimate of the loan-related expenses that are due at closing, but the amounts are just that--estimates, not guarantees of your actual closing costs.

Loan origination can be called a loan origination fee or a point and covers the lender's costs of processing the loan. The fee is usually a percentage of the loan amount and the percentage varies among lenders.

A loan discount is called point or discount point and refers to a one-time charge imposed by the lender or broker to lower the interest rate. Each point costs 1 percent of the loan amount and typically lowers the rate by 0.125%. Do a few calculations before you buy discount points to determine if the purchase will really save you money.

The appraisal fee pays for the appraisal report the bank requires to evaluate the property's worth before lending you the money to buy it.

A credit report fee pays for the reports that banks use to study your credit history. Credit reports and scores are one of the items that help the bank determine if you are a good credit risk, how much they can lend you, and what interest rate they should offer.

A lender's inspection fee is often charged when you build or buy home that's under construction. It pays for routine inspections the lender requires to monitor construction and release funds as work progresses.

A mortgage insurance application fee might be charged if your downpayment isn't enough percentage to allow the loan to be approved without private mortgage insurance, called PMI for short.

You might pay an assumption fee if you assume, or take over, the responsbilities of paying the seller's existing mortgage.

Closing costs paid in advance cover expenses that occur after closing. Prepaid interest covers the interest due on the loan from the day of closing until your first monthly payment.

If you are obtaining PMI the lender will require you to pay some portion of the premium at closing.

You'll probably pay for a year of hazard insurance at or before closing to protect you and the lender against loss from fire, windstorm, and some other hazards. If your new home is at risk of flooding the lender will require that you purchase flood insurance. Your lender might require other types of insurance for homes in your area.

Most people start funding their escrow, or impound, accounts at closing by paying multiple monthly payments for each bill the lender pays for them annually, such as property taxes and hazard insurance. Lenders jump start the accounts at closing to make sure there's plenty of money on hand when the bills arrive next year.
RESPA puts limits on the amounts your lender can require you to pay in advance.

Your home inspection is a closing cost, even if you pay it before your settlement date. So are radon tests, pest inspections and other specialized inspections you perform at the property.

Payments for home warranties are another common closing cost.

Arrangements for closings vary. In some states you will pay an attorney to do a title search, apply for title insurance for both you and your lender and perform the actual closing. In other states the title work is handled by specialty companies and closings take place in varied locations.

Your closing agent might charge you a notary fee to have loan documents notarized. You'll pay a recording fee to have the new deed and other documents recorded in public records. You might also pay an overnight fee to send documents to the lender and a wire transfer fee for incoming or outgoing funds.

You might pay a one-time impact fee, sometimes called a transfer fee, if you are buying a home or condo in a housing development. You'll also pay your share of the development's annual association fees.

You probably won't pay all of the closing costs I've mentioned, but there might be additional fees that you will need to plan for, so ask your lender, your reality agent and your closing agent for an estimate of expenses you can expect to pay when you buy real estate in your area.

posted by Rick at 4/17/2006 09:27:00 PM

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Sunday, April 16, 2006 4/16/2006 09:44:00 PM

FavoriteAgent.com Exceeds Ninety Agents

FavoriteAgent.com, an Internet-based reality company headquartered in Fayetteville, NC, has accomplished another major expansion. Already the largest brokerage in the Fayetteville market after less than two years in existence, FavoriteAgent now includes more than ninety agents on its local team. In addition, its customer-acquisition technology is part of a nationwide revolution in the reality industry.

Fayetteville, NC (PRWEB) April 16, 2006 -- Matt Jones, Founder, CEO, and Broker-in-Charge of FavoriteAgent.com, an Internet-based reality company headquartered in Fayetteville, NC, announces another major expansion for his company.

Already the largest brokerage in the Fayetteville market after less than two years in existence, FavoriteAgent has recently added the following names to its local team:

• Grant Edwards, who is a native of Fayetteville, is a broker and reality agent with FavoriteAgent.com. A graduate of the University of North Carolina at Chapel Hill with a Bachelor’s degree in Business, he was a partner in Edwards’ Music Store for more than twenty years.

• Jennifer Oberosler, an Army veteran from Long Island, NY, has a broker’s license, as well as a degree in Communications Science from the University of South Florida. At FavoriteAgent.com, she serves as Assistant Director of National Relocation Services under Director Mike Crawford. Other Relocation Team members include Chris Kwiecien and Barbara Mounts.

• Chris Kwiechen, a reality agent and Army veteran from Texas, has a background in sales and financial planning and was previously a mortgage loan officer.

• Barbara Mounts, of Gilbert, WV, and Raeford, NC, earned her reality license in November 2005 after a fifteen-year career as owner of the Rockfish Café.

• Sandra Tejada, a native of Albany, NY, is a graduate of the J.Y. Monk School of Real Estate and is completing course work for a degree in Business Administration from Fayetteville Technical Community College.

• Tim Thompson, a reality agent originally from Cairo, GA, is also a sales support representative for Novar Controls Corporation.

• Becky Cameron, a Fayetteville native, was a Civil Service employee for twenty-one years, in Health Systems Management. She has joined Doug Nunnally’s team at FavoriteAgent.

• Dave Hurt of Tucson, AZ, has been stationed for fourteen years at Fort Bragg as a Special Forces engineer but is also an instructor at Camp McCall. SFC Hurt has served four tours of duty in Afghanistan. He is a member of Julie Stamper’s Freedom Realty Team.

• Linda Martinson of Staten Island, NY, is a Licensed Practical Nurse and a reality agent for FavoriteAgent.

• Gisela Martinez, a native of Mexico City, Mexico, was a Human Resources Specialist stationed with the Army at Fort Bragg. She became a reality agent because of the personal independence that the job offers.

• Gerrie Currie, of Martinsville, VA, and Raleigh, NC, moved to Fayetteville to join family members and has recently become a reality agent.

• Shanica Jones, a New Orleans native and Staff Sergeant currently stationed at Pope Air Force Base, is pursuing a degree in Psychology from Campbell University. SSgt. Jones served a tour of duty at Osan Air Base in Korea before returning home to become a licensed reality agent.

• Valencia Applewhite, of New York, NY, retired from the US Air Force after twenty years as a communications specialist and was working as an active-duty civilian at the Pentagon on September 11, 2001. She is a reality agent.

• Kenneth Hwang, a broker and reality agent with FavoriteAgent.com, is a native of Seoul, Korea, and recent resident of Northern Virginia. A graduate of Penn State University with a BA degree in Psychology, he sold real estate in Virginia and Maryland before entering into a Master’s program in Marriage and Family Therapy with Capela University.

• Mickey Phillips is a Fayetteville native who studied computers at Fayetteville Technical Community College and spent fifteen years in the computer business before earning his reality license and joining FavoriteAgent’s local team.

• Tristan Pan, a new reality broker originally from California, is a naval aviator and member of Mensa.

• Jamie Satterwaite, a Michigan native, served with the US Army before becoming a reality broker with FavoriteAgent.

• Kristina Montgomery moved from Eugene, Oregon, to join relatives in Raeford, NC, then became a reality broker with FavoriteAgent.com.

• Megan Cox, originally from New York, earned a Bachelor’s degree in Communications from Mercy College and a Masters in Mass Communications from Iona College and is now an adjunct professor teaching communications at Embry Riddle College. She is new to real estate and to FavoriteAgent’s local team.

• Janice Elliott, a Fayetteville native, received her reality license twelve years ago and has recently earned a broker’s certification as well. She is a nursing instructor at Fayetteville Technical Community College, having been awarded a Bachelor’s degree in Nursing from Fayetteville State University and a Master’s degree from the University of Phoenix.

About FavoriteAgent.com:

FavoriteAgent.com, an Internet-based real estate company that has signed 800 agent partners in all fifty states and Canada, specializes in real estate lead capture. Its customer-acquisition technology is part of a nationwide revolution in the real estate industry.

posted by Rick at 4/16/2006 09:44:00 PM

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4/16/2006 05:58:00 PM

Loan Officers Secret Weapon

A good loan officer is hard to find. You can get all the referrals you can handle, but they don't count until the "rubber meets the road." Or your lock registration reaches the lock desk.

Face it, you won't really know how good your loan officer is until you're stuck with them. For better or for worse. But do you want to know a secret?

The best loan experience out there may not rest solely on your loan officer. It might very well be reliant on someone you've never heard of ... your loan processor.

The loan processor is the single most important support person a loan officer has, and they can carry a lot of weight in a mortgage company. It's the loan processor that does all the heavy lifting during your loan approval. Your loan officer is out getting more loans or taking your Realtor to lunch or "whatever."

Great loan officers can't be great loan officers without great processors. In fact, I wager that a prerequisite of being a great loan officer is in fact having a great processor. Just as a loan officer can completely screw up a mortgage deal, so too can a bad loan processor kill a loan.

Why would you want the best processor? The processor is the one you have to rely on to take care of problems. Great processors know how to take care of day to day problems that the loan officers or sometimes even the borrowers themselves never even know about.

Great processors can take a loan application from start to finish and make it look easy. But trust me, being a loan processor is difficult. It can be stressful. Processors take all the various elements of loan approval, put them together, in order and at the right time to make sure everything is done when and how it's supposed to be done.

They can get yelled at by people they'll never meet over things that are completely out of their hands.

It's the loan processor that deals directly with attorneys, insurance agents, appraisers, inspectors, underwriters, title companies, closers and, oh yeah, the borrowers and the loan officer.

The way to find the best loan officer is to find the best loan processor. So how can you do that? Do you call all the mortgage companies and ask to speak with all their loan processors? No, but you can come close.

When talking to a potential loan officer about their rates, fees and programs, you should also be asking about that loan officer's experience in the industry. How long have you been in the business? Do you have any referrals from people I might know that can attest to your experience? Good questions to ask.

But ask one more. How long have you been working with your loan processor and how long has he or she been processing mortgage loans?

If your potential loan processor is brand new or the loan officer doesn't have a choice on which processor to use, it's more likely you'll have a bumpy experience.

If however, your loan officer has not only been in the business for ten years but has also worked with a particular loan processor for a long, long time, then you've found your ticket. Your loan officer and processor work as a team. The longer they've been working together, the better off you'll be.

I'll bet you didn't know that, did you?

posted by Rick at 4/16/2006 05:58:00 PM

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