Brian Diez talks about why ARM mortgages are still so popular.  Despite the problems mortgagees are running into, many ARMs or any other exotic names they might come under.  He basically believes lenders are spewing the same rhetoric they were taught.  They’ve repeated the pitch so often they believe it?

We are very far from when our forefathers created this country as a place to live free.  Owning a shelter is part of the American dream, as well as prosper in business through free trade. Imagine a man and woman trying to start a family nowadays.  They typically work 2 jobs each, struggle and sacrifice several years until they have enough to put down maybe 5 or 10% for their dream home.  Using a typical 30 year fixed mortgage, they would like retire and have their home paid off.  Now someone whispers in their ear that an Option Arm is a great program that gives them 4 different payment options. With a minimum , interest only of 15 year, and 30 year payment.  They are lead to believe with the minimum payment they’ll lose a some equity but with houses appreciating as they have in the past, and this is the key flawed argument, they’ll recoup.

Most people are not well coached and are hit with expenses they weren’t expecting, such as furniture, repairs, electric, oil or gas, water, landscaping, telephone, cable, internet, etc. Credit cards might come in handy and are tempting. But now, a year later, they notice their balances on their mortgage statements. Their first mortgage, the option arm which started at $320,000.00 is now $340,000.00. The second (line of credit) still show s the original balance of $40,000.00.

They might have expected this and wanted to catch up before too late, but now the real estate market is adjusting with downward prices.  They now owe more than they paid.

Indeed a borrower must have the discipline to make extra payments and reinvest their money.  Unfortunately, it isn’t always the case.  People are stressed to work hard, make money, raise children, pay more money and taxes.  They might not fully be aware of what it entails as far as discipline and financial guidelines.  Surely, it isn’t a Lender’s business to educate either but I feel it takes two to tango.  But why not take a slightly more expensive 30 year fixed if it saves you hassles in the short run?  Surely floating interest rate cannot be better than a fixed one for most people?

Shop around, educate yourself, ask questions, go online and hear what others have to say.  Start reading the Dummy’s books first and don’t forget to check out Brian’s blog.

One thing that always makes me smile when I hear people talk about Robert Weil Associates is: "Oh, you guys deal in up-scale homes."  It makes me smile because it’s not true.  I guess we are victims of our own success.

Looking at our inventory on a yearly base, the bulk of our homes are in the $700,000, seconded by $500,000 and finally third in the above $1,500,000 homes bracket.  In fact we sell more homes in the median price for Long Beach than in the high bracket. 

But what makes our homes so special?  We present them like no other companies in town do.  The Robert Weil Associate touch when presenting a home for sale is legendary and with good reasons.  We really go out of our ways to represent your home in the best possible manner, enhancing the interior of your home.  Our merchandising is above the competition.  This is what makes any of our homes stand out, from the $25,000 one bedroom we sold to the over $2,000,000 golf course view ones.

When I hear people talk about their experiences with real estate I am happy to be working with a team of amazing, ethical professionals who love their work.  After all, real estate is not a job, it is a vocation, a love of homes very few people have.