Category: Manny Kagan

Unfortunately (or fortunately for my waistline), she cannot ship them because she doesn’t use any preservatives and the shell is very fragile.

Mary was at the location for 15 years, when suddenly she was informed that the building was going to unexpectedly be sold for $930,000. She wanted to buy the building, and to do this I was able to secure her an SBA (Small Business Administration) loan with only 10% or $93,000 as a down payment.

Whom do you know that might benefit from creative mortgage solutions?

Do not keep me as a secret.

Our reason (or excuse) to visit Venice was La Biennale di Venezia. Our daughter Alona, who is an art dealer in Paris, was at the opening and strongly encouraged us to come. It is a biannual art exhibition, which has taken place in Venice since 1895. There are two enormous general pavilions, plus small ones for the different countries in two different locations, in addition to many other exhibitions throughout the town.

This year, the show exhibited works of over 150 artists from 37 countries and was dedicated to the subject of the inner and outer world of humans and exhibited works of many unknown, yet remarkably talented artists. Some were self-taught. 

There were very interesting works of the famous psychoanalyst Carl Jung, who started painting to overcome depression. There were other artists, who discovered their talent after having physical illnesses or disabilities. We saw a video of artists, blind from birth, who created incredible images.

There were a few artists, who claimed that they started creating art after receiving instructions from the outer world. It is impossible to comprehend what inspired them for years, day after day, to work on their remarkable craft.

What inspired great musicians and other artists to bring their work for our enjoyment?

The word inspired means—“of extraordinary quality, as if arising from some external creative impulse”. (Webster Dictionary) The root of the word inspiration stems from Latin in + spirare—meaning “to breath in spirit”. What is a spirit? When we say a spiritual person, what do we mean? Aren’t we all made from flesh and spirit? In the Torah, the first sentence contains the word spirit:

“When the earth was astonishingly empty with darkness upon the surface of the deep, and the Divine Presence hovered upon the surface of the waters.”—Genesis 1/2

The way it is written in Hebrew Ruach Elohim—means God’s spirit (which translates to Divine Presence). We say that a gifted person has a divine spark, but there is another name of the spirit, which we call soul.

“And Hashem God formed the man of dust from the ground, and the blew into his nostrils the soul of life; and man becomes a living being.”—Genesis 2/7

There, God’s spirit appears in Hebrew as Neshama, which means breath.  To confuse us even more, the next chapter called “Noah”, named after the person whom God saved from the flood, and from whose children the rest of the world was populated, describes God smelling a burnt-offering.

“Hashem smelled the pleasing aroma, and He said in His heart”—Genesis 8/21

Whom do you know that might benefit from creative mortgage solutions?

 “A moustache is what we see on the face of a man. 

*The interest rate is fixed for 30 years for 4 units. Interest rates are subject to change without notice and do not constitute a commitment to make any loan at any specific rate.

Iris is a widow. She owns a condominium and works as an engineer. Her cousin, Nora, is divorced with a child and works as a nurse. As a result of the divorce, she not only lost her husband, but also a house which sold through a short sale.

Both of them have good income and together they decided to buy a two-unit building. Though the amount of money both of them have is enough to secure a loan with 85% LTV (loan to value), Nora’s credit restricts their options.

The solution is an FHA loan, which allows borrowers who had a short sale to get new financing three years later.

First, Iris decided to refinance her condo, which she was going to rent to lower her mortgage payments by $300/month. Meanwhile, Nora simultaneously started the credit correction process.

Increasing Nora’s credit score to 740 would allow them to get a better loan AND to avoid paying mortgage insurance on an FHA loan.

Whom do you know who might benefit from creative mortgage solutions?

“To vote or not to vote is not the question…VOTE!” 

*The interest rate is fixed for 30 years and the credit score is a minimum of 620. Interest rates are subject to change without notice and do not constitute a commitment to make any loan at any specific rate.

Two weeks ago in my writing about the government shutdown, I made a reference to an article in the SF Chronicle.  One of the issues that the article brought up was that Wells Fargo needed the 4506T form to close mortgages; while, Citibank claimed that they did not need it. This little detail had become a huge issue in the mortgage industry during the shutdown. The 4506T is one of the forms that borrowers sign when they apply for a mortgage. This form authorizes lenders to request a copy of the borrowers’ tax returns from the IRS, to confirm that the 1040 on file has the correct information.

Because the IRS was closed during the government shut down, it literally stopped the process of loan approvals, or funding, since mortgages cannot be sold to the government owned Fannie Mae, Freddie Mac, FHA, and VA without confirmation from the IRS. It is unimaginable what effect this has on everything related to the real estate industry.

The reason that Citibank claimed that they did not require the form is because they offer portfolio loans (i.e. adjustable loans fixed for 3, 5, 7, or 10 years and NOT 30 or 15 year fixed loans), which are sold to the government owned agencies. The shutdown clearly marked the dramatic line in the banking industry, which started after the meltdown when the government had chosen to save Banks too big to fail, which as a result became even bigger. Those banks do not need to finance mortgages to generate profits anymore. They only offer mortgages to attract more depositors with their interest free money.

But the shift has already started. There are a number of articles like the one in the Wall Street Journal on September 3^rd—“At Small Banks, Loans Rising Faster” and in the latest Consumer Reports magazine with the provocative article titled—“Dump Your Big Bank and Save”.

I am a strong proponent of smaller community and regional banks. We bank at the First National Bank of Northern California. After years of working with Wells Fargo and giving them millions over the years, they cut our business line of credit at a critical moment of our business. I refer my clients to Comerica Bank, where Leanne Gueco offers excellent service and good interest rates for lines of credit.

Though Government regulators come up with more and more consumer protection measures which affect the ability to secure the mortgage, it seems that somehow we always find solutions. We do work with a number of lenders who offer loans without the need for a 4506T form, and many other creative solutions, which I write about in my weekly “Today’s Special”.

P.S.

I used the images of the animals to bring smiles to your faces while I am writing about such a boring subject. Although big Banks earn enormous profits on Wall Street and do not care very much about you and me, the small banks are still very vulnerable. Most of the mortgage industry is blinded by the government regulations and is grateful for whatever food (mortgages) we can generate through government owned agencies. And I, with my little voice, try to bring you good news and joy when your mortgage is funded.

Do not keep me as a secret.

 SMILE AND PLEASE SHARE IT WITH A FRIEND

* Loan is amortized over 30 years. Interest rate is fixed for 5 years. Credit score is 720. (Credit score can be as low as 660 with an increase in closing costs.) Interest rates are subject to change without notice and do not constitute a commitment to make any loan at any specific rate.

* Based on a loan amount up to $417,000 for the owner occupied single-family residence with a 15/15 term. Interest rates are subject to change without notice and does not constitute a commitment to make any loan at any specific rate.