Category: Manny Kagan

We own a few weeks in various timeshares. We purchased our first timeshare in 1984 in a place called Arnold, located in the foothills of Calaveres County. We have only stayed in that timeshare two times–the rest of the years we’ve exchanged it through the RCI System. Someone recently asked me if it was a good investment. For our family–it was. We have traveled the world, visiting places we would probably never get to if not for this “mandatory” timeshare vacation. On each trip to a new location, promoters try to sell us yet another resort or another deal. And through the years, some of them were successful. My wife Elfa became an expert in finding our next vacation through the timeshare websites. Internationally, we have traveled to various parts of England, Germany, Austria, Whales, the South of France, Holland, and many beautiful locations in Canada…not to mention Hawaii and Mexico. And we have travelled throughout the United States as well. Each resort has a different charge for the yearly maintenance fee. Extra weeks can be banked for future use. We have used our weeks in the bank to get additional units to allow our family to join us. When we weren’t going to use our weeks, Elfa has sold the extra week for the cost of the maintenance.

At the end of March, I had a marketing conference in Phoenix, Arizona. On the spur of the moment, Elfa asked me if I can have a week off. I knew that I needed a rest, besides I had to work on my book, “Mortgage Solutions for Smart People: 5 Easy Ways to Get Your Mortgage Approved”. Luckily, she was able to find us a timeshare in Sedona, which is about a two hour drive from Phoenix.  We’ve been to Sedona before. It is a secret ground for Native Americans, known for its’ energy vortexes in the red cliffs around the area. I wrote for eight hours a day, only going out for a few hours in the afternoon. The result–a finished book and only a few photos. In between, I had to put out a few “fires” with some closing loans for sales transactions.

What prompted me to write about this subject was a very unusual email my office received a week ago from one of our lenders. After we refinanced a mortgage for a client, his loan was, as it is customarily done, sold to an investor–who could be Fannie Mae, Freddie Mac, or another bank. Two months later, our lender was notified that after the quality control procedure, the investor found some missing information in our clients’ file. If this information is not provided on time, the file is returned to the lender. If (God forbid) this happens, it is a very big problem for everyone. The investor claimed that apparently our client owns a co-op in San Francisco, which he did not disclose. I refinanced for this client a number of times, and I did not remember him ever mentioning any other properties (usually clients tell me everything).

What turned out was that this co-op building was transferred many years ago into a timeshare project. Our client owned a week of time not physical space. Though there is a yearly maintenance fee, which included a prorated tax, it is basically a prepaid vacation plan. The solution to this “big” discovery was very simple–to write an explanation letter. But what it demonstrated to us was that when lenders require so many documents or verifications, which takes our extra time and drives everyone crazy, it is not so much the lenders, but the Government owned investors. After losing billions in the reckless lending before 2008, the screws are getting tighter and tighter.

In spite of this, we close most of our loans and most importantly get clientsVERY LOW INTEREST RATES.

P.S.

I just had a few images to share with you where I usually showcase my artistic interpretation. Hope you like them…let me know. You can see more beautiful Sedona images (not mine)–right here.

When we stepped out from our hotel on the streets of Havana, we were greeted with a smile. Young people walked toward us with a genuine grin on their face. They did not notice us, and the smile was not for us…just for themselves.

We spoke with an American guide, who lives in Havana, and asked him , “Are Cubans happy?”

His answer was “Yes… are they content? No.”

People have very little, materially. Life there can be tough with much fewer resources and opportunities than we have here in the US.  So, what makes them happy?

As I wrote before, the reason I want to go back to Cuba in December is because I would like to be in the presence of these people and their smiles. I’ve provided more examples of what I’m talking about in these images. I decided to write about “Stress-Busting Smiles”, after reading the article with this title, which appeared in the Wall Street Journal on February 26, 2013. We went to Cuba with a US Treasury Department permit for travel with the “People to People” exchange. We were supposed to bring them ideas of the US way of life. I am sure Cubans can learn a thing or two from us, but what I’ve learned from them is to be happy in any adversary situation.

After reading the Wall Street Journal article, I try to remember to smile whenever I can. According to the article, this is not only beneficial for your health; but also, the physical act of smiling actually lifts your mood. Next time, try to smile and be angry, or depressed at the same time. Mission impossible.

Read the article to live a healthier life.

P.S.

The mortgage business is plagued with a lot of new government regulators imposing changes. In my humble opinion, these new regulations–while they are called Consumer Protection–have an anti-consumer reality. But what can I do about it? After a trip to Cuba and reading the article, I found a solution.

I smile.

Actually, I have a lot of compassion for those hard working regulators, who also have children in private schools, have to pay mortgages, and are simply lucky to have a job in today’s economy. As far as mortgages are actually concerned, we need to find solutions in the given circumstances, like the one I describe below.

We just closed a mortgage for a client, who bought a pre-foreclosure property. We had very limited time, and our client had a number of personal issues and problems–solutions for which I describe in my forth-coming book, “Mortgage Solutions for Smart People: 5 Easy Ways to Get a Loan”. We submitted the loan to a bank, but because of the date of a possible foreclosure, (which was actually postponed), the lender declined the loan. We only had three weeks to close the loan. As it often happens in my life, at the last moment, I found a bank that could close a mortgage in three weeks on a no income (remember the ol’ good days?) loan. Where there is a will, there is a way.

P.P.S.

If you want to meet smiling people, join us in December for a trip to the Havana Jazz Festival.

“The gem cannot be polished without friction, nor man be perfected without trials.”—Danish Proverb

In the Torah, the process of creationis divided into six days with the seventh as a day of rest. By the end of the sixth day, all the creation was completed.

“And God saw all that He had made, and behold it was very good. And there was evening and there was morning, the sixth day.“—Genesis 1:31

According to the Jewish calendar, the daily count starts on Sunday, so Friday is the sixth day, which in God’s view was very good. In the King James version of the Bible, the word “Good”, meaning “joy and pleasure”, appears 809 times. How then is it possible to call the day when Jesus, the Son of God, who was crucified by Romans “Good Friday”? Christianity, like any other religion is full of the controversies. There is a belief that the original name for this day was “God’s Friday”, which over the years became its present name. According to Wikipedia, this day is also called “Holy Friday”, “Great Friday”, “Black Friday”, or “Easter Friday”.

After Jesus died on the cross and the Roman centurion (soldier) pierced his body with a lance and blood and water came out, he was proclaimed dead and was buried in the cave. Three days later (i.e.  on Sunday), his body disappeared from his grave and there were some witnesses who claimed that they saw Jesus alive. Thus the story of the resurrection was born, which is now celebrated on Easter Sunday, which is probably the most celebrated Christian holiday. But what do bunnies and hard boiled painted eggs have to do with the resurrection?

According to GotQuestions.org, ancient Roman Catholic church authorities mixed this event with the pagan celebration of the goddess of spring called “Eastre”, whose earthly symbol was a rabbit, which was also known as a symbol of fertility, in attempt to attract non-believers.

In religion, like in other aspects of our lives, marketing and packaging sells. My concept of marketing, which coincides with Good Friday is to “Find good in any adversity”.

P.S.

On March 13, 2013, Catholic Christians learned of their next spiritual leader, The New Pope, Jorge Mario Bergoglio (Pope Francis) is Spanish speaking from Argentina. Cuba, which was occupied by Spain for many years as well, not only adopted the Spanish language, but also the Catholic faith, which often blends with some Caribbean influence.  For the last 53 years, Cuba has been a socialist country which follows Karl Marx’s doctrine that the “Religion is Opium for the masses”.

On our trip to Havana, we saw many dilapidated, old and beautiful buildings. But when we visited two cathedrals, we were shocked by their beauty and opulence and perfect condition. Miracles do happen.

You can discover for yourself how beautiful these places of worship are by joining us on our next trip to Cuba in December. Meanwhile, enjoy some of the images I photographed.

P.P.S.

I do not want to spoil your Holiday spirit, therefore I will write about what is good in getting a new mortgage next week.

Happy Easter!

When I came closer to the small farmhouse, a little dog with a heavy chain ran toward me loudly barking. We were exploring different areas about an hour drive from Havana, and stopped for lunch in an off the road farm area. The “restaurant” was an old building with a large porch in front and a long communal table. While everyone settled down, placed their order, and photographed a chicken with her chicks that came to feast on the scraps from the table, I ventured into the farm. An older man alerted by the dogs barking came out from the house. I greeted him and he showed that there is more to photograph in the backyard. The scenery could have been similar to any farm anywhere in the world. The rotten shed with the chain on the wall, laundry outside with a Nike t-shirt hung over a broken motorcycle. There was a barn with a locked door and its content revealed through the gap by my curious camera lens; a ladder leaning on the small house, and a rooster proudly checking his territory.  When I turned around, I saw the owner in front of a red VW minibus without wheels. When he came closer, I photographed his close-up portrait.

Then, I heard an angry woman’s voice. There, in a small window at the back of the house, was a woman with only two teeth sticking out from her mouth. For me, it was a perfect photo opportunity, but despite my requests she refused to be photographed. Since I can only say a few words in Spanish, it did not help much. So I decided to bribe her. I ran back to our group where I had some give-away goodies in my bag. But when I returned with a bar of soap, she refused to take it. Meanwhile, everyone gathered on the little porch and the dog started to bark again.

There I did something which was natural for me, but probably not expected. I sat down on the ground in front of the dog. One of the rules of photography is to get on the same level when photographing animals and children and to always focus on their eyes. The dog calmed down and went back to his barrel.

But something else happened. I no longer saw an old woman, but a beautiful person. This energy transformed both of us. I turned around and had no problem photographing her. She allowed me to create her portrait, wanted to be photographed with her husband, and then asked him to photograph me and her together.

I had to go to eat my lunch and promised to come back with the interpreter. After we returned, the woman told my friend, who spoke Spanish, about her life and said that she loves me and asked her husband to give me their address requesting that I mail them the photos I took. We continued our journey. After the encounter, I photographed hundreds of other people, but when I reviewed the photos from my trip on my computer and saw the woman, a warm feeling filled my heart and I wanted to share this story with you.

Now I would like to interpret how these photos relate to my book “The Mortgage Game: The 5 C’s and How to Connect Them”, where I share my life and my clients’ stories. To see the connection, just follow my photos:

Clients anxious about their ability to get a loan complain about their circumstances, lenders,  and appraisers–(bark like this little dog).

Borrowers (chicks) rush to get mortgages with low rates brought to us by the Federal Reserve (the chicken), under the watchful gaze of the government regulators (the rooster, ready to step in at any moment).

“A woman is the full circle. Within her is the power to create, nurture, and transform.”–Diane Mariechild

It is pure coincidence that this email appears on March 8^th–the International Day of Women celebrated in the former Soviet Union. When we were in Cuba, we heard that there were going to be elections on the following day. Since we did not watch local TV, or read Cuban newspapers, we had no clue that this was happening. Some tourists we met commented that not much is expected to change. I promptly forgot about this until on February 13^th when I was back in San Francisco, and read an interview with retired Cuban President Fidel Castro in the S.F. Chronicle. Castro is 86 and ailing. In the article I read, “…he applauds the Cuban People for electing more women than men in the 612-sect National Assembly”. This really struck me. How much would have changed?

The former Guerilla leader is applauding that women have gotten more power in the government. The change is not only in Cuba. There are 97 women currently serving in the 113th US Congress compared to the 90 that served during the 112^th US Congress. I feel that these changes will help shift the overall energy to making the world a less aggressive with a more consolatory female touch. Nevertheless, according to the article in the S.F. Chronicle on March 1st , Carly Fiorina, who was CEO of Hewlett-Packard in 1999 and the first woman to run a Fortune 20 company, sees a double standard.

When it comes to the mortgage business, it seems it is still run and controlled by the rigid standards set by men. Many of my female clients have been challenged to refinance their mortgages primarily because of a lack of verifiable income–despite the fact that they consistently make their mortgage payments. Some, who are self-employed, like beauty professionals or consultants, were able to get stated income loans in the past. Those programs are mostly gone. Some borrowers try to modify their loans to lower the rate. What borrowers do not know is that banks cannot modify existing loans until borrowers stop their mortgage payments. Some loan originators in the banks give borrowers unofficial advice to stop payments to enable a modification.

First of all, there is no guarantee that the modification will take place; meanwhile, there is a risk that the bank will foreclose, (though there is a new rule that forbids banks to start a foreclosure during the application for a modification). In any event, the real problem is that if borrowers will have late mortgage payments, and their credit score will be affected. Since not only mortgage companies, but also many other entities like insurance companies, car loans, home rental agencies, and even employers check consumers credit, a low credit score can be a big liability.

Unfortunately, the only solution is to have a paying salary high enough to qualify for a loan, which is obviously a “Catch 22” with the high unemployment rate in California and the effects it has on women, as was explained in “Job cuts hitting women harder“, which appeared in the S.F. Chronicle on March 1st. Sometimes co-signers can help to get qualified for a loan. However, in some cases it is better to sell a home if it is possible and rent instead for lower monthly payments.

I write more about this situation and the solutions in my forthcoming book,“Mortgage Solutions for Smart People: 5 Easy Way to Get a Loan”. If you need assistance, I know two powerful women who can help you–Ildiko Pali, who is a realtor and a short sale specialist, who can be reached at 415-923-7628 /[email protected]

If you are seeking a good person to help you with your tax issues, I recommend contacting Elizabeth Shwiff. She is the head of the CPA firm, Shwiff, Levy & Polo, LLP and can be reached at (415)291-8600 /[email protected]

P.S.

I travelled to Cuba with my “power woman”, my wife Elfa. We have been married for over 45 years and are partners in our business as well. She is also a talented artist and primarily paints and draws portraits. While she never expressed a strong interest in practicing the art of photography herself, through the years she has helped me work on my images with my photography software. Before our trip, I gave her a crash course and with my small pocket camera, she bravely followed me on our journey. In our past travels, she did not enjoy my frequent stops to take photos wherever we went.

Now…I had to wait for her.

Not only has she overcome her shyness and started asking people to photograph them, she was taking close-ups! After a few days, she told me that this year I will not have difficulty to find her a birthday present. A new photographer is born. Other than the one below when I caught Elfa in action, the great portraits in this email were taken by her.

P.P.S.

Are you coming with us to the Havana Jazz Festival on December 15-23^rd of this year? Our group is growing. There is a limited number of participants. Last year, it was sold out. There are many other trips every month you can find on Cubaexplorer.com Those trips require specific legal documents and preparation. Please let me know if you cannot join us in December, but want to go a different month. I can help you with the paperwork. If you want to get great travel photos, I will teach you how–just join us on the trip to Cuba in December.

Seek for seeds of victory in every defeat.”–Chinese Proverb

At the end of my last email, I wrote about our next trip to Cuba and invited you to join us. What has happened is that you received the draft before the final version–thus you discovered the secret of my “Good News” email production.

Usually, I pick up an idea or read about something that I think might interest you. Then I write it by hand on the back of recycled paper (to save trees). Sometimes, I do it after work at home, or in a coffee shop, or even when I get inspired on the napkins in restaurants. Sometimes, I rewrite it with more current ideas, especially related to mortgages.  My assistant, Samantha, types out my scribbles, I check and make corrections, and it is emailed to my daughter Tamar who lives in L.A. She is a good writer and makes stylish grammar recommendations. Then, I choose photos to support the weekly theme. Samantha puts everything together and every Friday morning you are sent my “Good News”.  

Since I wanted to bring your attention to our trip to Cuba, this gives me an opportunity to email you again with the corrected revision:

After browsing through the Smithsonian magazine, my wife Elfa, asked me if I want to go to Cuba again and I immediately said, “Yes!”, but it is pricey.  I also remembered that awhile ago I saw a website talking about jazz trips to Cuba. On the web, I found cubaexplorer.com, an organization located in Vancouver, Canada that offers educational tours to Cuba and has many monthly trips including one for 9 days this year, on December 15-23. You can find more information at jazzcuba.com.

Will you join us? My list is growing. I already have 10 referrals and each has their significant other and friends. Let’s have fun together!

Now let’s talk about mortgages.

Let me share with you how we recently helped Rachel refinance her loan and the screw-ups we had to deal with. Mistakes are often a result of misinformation. Rachel worked for a non-profit organization that helps sick people whom she visits during the day. In 2010 and 2011, she was able to use her job related expenses to lower her taxable income by filing an IRS 2106 form. In 2012, she changed companies and her new employer reimburses her for the expenses, which then increases her take home income.

When we submitted her loan to a lender, it was turned down because of the “losses”–deductions based on the IRS 2103 in the previous two years. Her new paystub showed that she received reimbursements, but we did not yet have her 2012 tax returns. In my book, “The Mortgage Game: The 5 C’s and How to Connect Them”, I write that the mortgage industry lost the 6^th C–Common Sense. Knowing the problem, we discussed it with another bank and were assured that it would not be a problem. Guess what? The loan was declined again. We did not despair and since as mortgage brokers, we can work with many different banks, the loan was submitted to a third one–and this time it went through. I describe many stories and solutions like that in my new forthcoming book “Mortgage Solutions for Smart People: 5 Easy Ways to Get Your Loan Approved”.

P.S.

Someone asked me if there are many bicyclists in Havana. I did see and photographed a few but not as many as in some other countries. But there are many three-wheel, two seater taxis, pedaled by very friendly tricyclists.

P.P.S

I am not sure if you care very much, but I misspelled the name of the Venezuelan president, his name is Hugo Chavez. Since my email, he has returned to Cuba, and still has difficulty to talk; but, it was also reported that he requested his diplomats to seek the ways to improve the relationship with the United States.

Is Cuba next?

“The slower you drive, the farther you get.”–Russian Proverb

Last week, I wrote about life in Cuba, which as I’ve noted, is “complicated”, as well as how getting loan approval in the U.S. can be complicated as well. By law, Cubans cannot buy a new car, or have a mortgage. There is a shortage of housing, and many people in Havana live in challenging conditions. Many families share old, beautiful, but dilapidated buildings, each occupying one room with very few amenities. This reminds me of the way we lived in Riga, Latvia during the former Soviet Union.

The majority of people work for government owned enterprises and are paid in local currency, the National Peso, which they can use in stores with limited supplies and empty shelves. There is also the Convertible Peso, known as the CUC and commonly referred to as “kooks, to tourists. The US Treasury department doesn’t allow Americans to buy anything in Cuba, but tourists from other countries do not have these restrictions. There are better stores, which sell products and merchandise in CUC, which are also used by foreigners in the hotels and restaurants. There are 24 pesos to a CUC. Our travel guide told us that her monthly salary is enough to buy food for a week. Thanks to the tips that she receives in CUCs, she can afford more.

Cubans also get subsidized vouchers for special rationing stores which exchange vouchers for meat, fish, and bags of rice. Hugo Shaves, president of Venezuela, who is currently hospitalized in Cuba, is considered a friend and benefactor. I photographed his poster in one of those stores. There is also a popular barter system. A ballpoint pen that a person might receive as a gift from a tourist, can be exchanged for something else, and after a number of transactions, that person might end up as a piece of chicken for dinner.

On the streets of Havana, one can see many newer cars that are owned by various government agencies, each with differently colored license plates to distinguish who is who, as well as old American ones, some in very good condition. Those cars are privately owned since they were purchased before 1959. They have yellow license plates and often serve as taxis. To get around, Cubans and tourists can hire a two-seater motorcar or rickshaw-like bicycles. The problem with owning a car in Cuba is the same as it was in the former Soviet Union–the lack of spare parts. In my book, “The Mortgage Game: The 5 C’s and How to Connect Them”, I wrote that car owners in the Soviet Union, as well as home owners in the US have two joys in their life–when they get a new car/mortgage and when they get rid of it.

Cubans are very clever at fixing those old beauties with parts from other cars. Cuban life can be really complicated. Seeing their challenges brings to mind the saying “One cries for the lack of shoes, until meeting the person who does not have legs.” If next time you want to complain about anything in your life, just find a group traveling to Cuba.

American car owners might have different problems. In my new e-book that I am currently writing, titled “Mortgage Solutions for Smart People: 5 Simple Ways to Get Your Loan”, I discuss an issue of how to lower high qualifying ratios.

Car payments, like student loans and mortgages are called installment debts and are part of the second qualifying ratio, and in most cases cannot exceed 45% of one’s income, which also includes other obligations resolving debts like credit card payments. What most borrowers do not realize, is that if the ratio is over 45%, the loan request is going to be declined. In my book, I offer different ways on how to improve the chances and at the loan approval, steps to eliminate a lot of unnecessary headaches. One piece of advice that I give–never co-sign for other people’s car loans, unless you are willing to make the monthly payments yourself. One of my clients learned this lesson the hard way. After the son of his girlfriend to whom he helped buy a car, missed two payments, my client’s credit score dropped over 50 points and I could not help him lower monthly payments by $250. Car owners’ life in the United States can be complicated as well.

P.S.

Before my trip to Cuba, a friend asked me to photograph American cars on my trip. You can see some of them in this email. Since I do not photograph objects but life on the street, these images might give you an additional view of Havana. When I have time to put together a website dedicated to Cuba, you will be able to see more images including more cars.

P.P.S.

A few days ago, we received the Smithsonian Travel Magazine in the mail. They offer many great trips including a new one to Cuba. We met tourists at our hotel who were visiting Havana on a National Geographic Tour. Our trip through the Santa Fe Photographic Workshop was the best way to travel to Cuba for those interested in photography. (The one in April is sold-out.) The cost of those three companies (including a flight from Miami, FL) varies between about $4,000 to $6,500 per person.

After browsing through the Smithsonian magazine, my wife Elfa, asked me if I want to go to Cuba again and I immediately said, “Yes!”, but it is pricey.  I also remembered about the website talking about Cuba and jazz trips. On the web, I found cubaexplorer.com, an organization located in Vancouver, Canada that offers “Cuba Educational Tours” and has many monthly trips including one for 9 days on December 15-23, as part of the Havana Jazz Festival. The cost (including air fare from Cancun, Mexico) can be about $2,100 per person. Check out jazzcuba.com.

We Are Going.

I joined their Club Cubano and for each referred guest, they offer $150 discount. After 10 of my friends will join, my daughter can come for free. When we will have a group of 25, we can have our own bus and travel together. Are you joining us?