A Small World

Small World
(image via The New Wage Truth)

“Never doubt that a small group of thoughtful, committed, citizens can change the world. Indeed, it is the only thing that ever has.”
Margaret Mead

I received an email from a friend (who often refers me new clients), asking me if we do commercial loans. Our company is very unique. We are experts in every type of real estate loans. This week, we are working on a loan for the acquisition of a retail showroom, purchase/construction for two residential spec buildings, a refi loan for a hotel, a purchase of an industrial building, and a refi for a number of apartment and mixed use buildings.

One of the new referrals came from my corporate/real estate attorney, who has a client who needed to refinance an owner occupied industrial building. His loan had a balloon after five years, and the bank refused to renew his mortgage. When I inquired for the reason, he did not know, but informed me that he had short sales on two of his residential properties. My first reaction and obvious solution was to apply for an SBA loan. When I called my friend Bill Hand, who helps me with SBA loans, not only did he know the building, five years ago he helped the borrower to get financing for it. Bill also warned me that the client does not report enough income to qualify for a bank loan and because the borrower had a short sale, he cannot get an SBA loan.

The next step was to try to get a private loan to save the client from foreclosure. To accomplish this, the value of the loan had to be $1,500,000, while the bank appraised it for only $1,200,000. I questioned this value since I recently arranged financing for another building in the same neighborhood in downtown San Francisco and knew that the value had to be higher. To support my point of view, I needed an opinion from an experienced real estate agent, so I called my friend Rick O’Neil. (I wrote about him in my newsletter from last week.)

As it happened, Rick knew the building since only a week ago he found a tenant for the vacant space in the back of the building. While I was doing my research, the owner called his real estate agent Art, who works with Rick, to discuss the possibility to list the building for $1,500,000. Only a week later, Art had a buyer, who agreed to the full price. The buyer needed to get a mortgage. He contacted Wells Fargo Bank and Bill Hand. Bill used to work at Wells Fargo and knew that they would have a problem to approve the loan, but it would take them 60 days to realize it.

Meanwhile, Bill was leaving the bank he was working for. He called me, and there was a simple decision. We agreed to work together since I had sources to find fast solutions.

What a very small world we live in.

Mortgage Game Book

You may purchase my book on Amazon (paperback and kindle editions) or at Barnes & Noble (paperback and nook editions).

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Best Wishes,

Manny<br />

Manny’s Story and the Five Cs

From his childhood of factory work in communist Latvia to his current life as one of the Bay Area’s most respected and successful mortgage industry professionals, Manny Kagan has enjoyed a colorful journey to the top. In this fascinating new book, The Mortgage Game, Manny shares not only his amazing life story but also his secrets to finding the best mortgages possible. It all boils down to his trademark “Five Cs”—Collateral, Capacity, Credit, Capital and Character.

Using real-life examples, Manny shows how he was able to overcome the “minuses” of some of his mortgage- or refinance-seeking clients (and most clients have some minuses) and turn them into “pluses.” Just about every mortgage lender working today talks about the Four Cs, but Kagan takes it a step further and includes his own signature fifth C—character. This is the one that often makes the difference – and it’s the one that helped him become a leader in the industry.

In this book Kagan pulls back the curtain and shares details of his own real estate transactions—from the very first house he and his wife bought for their family, to subsequent refinance deals he was able to close on a basket of rental properties. The Mortgage Game is a valuable tool for anyone who’s thinking of investing in real estate or refinancing an existing loan.

The Mortgage Game offers up-to-date information on the current marketplace, along with clear explanations of how the market got itself into so much trouble. But this valuable book also offers more – it’s the one reference guide every home-buyer needs.