May 2011

Issue 046

May 2011

TheNicheReport.com

Yes — Intended Consequenses!Will they eliminate what is left of our industry?

10 Bringing Up The RearBryan Moynihan, CEO, Bank of America

582716 What are Realtors@

Demanding in Today's Market?Realtors seek those they know, like, trust and who deliver results.

FEATURE ARTICLE! InflationFact or fiction? You decide.

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6 May 2011

NICHE REPORTSCONTENTS Issue 046 May 2011

FOUNDER & PRESIDENT Robert Pegg [email protected]

CO-FOUNDER & PRESIDENT David Pegg [email protected]

MANAGING EDITOR Stewart Mednick [email protected]

EDITORIAL / CONTENT MANAGER Kristen Moser [email protected]

ACCOUNTING MANAGER Shawna Ingram [email protected]

ADvERTISING DIRECTOR Jessica Grizzle [email protected]

ADvERTISING SALES Heather Bopp [email protected]

PRODUCTION MANAGER Henry Suchman [email protected]

PRODUCTION ASSISTANT Dawn Exner [email protected]

CARTOONIST Martin Bradford

COLUMNISTS & CONTRIbUTING AUTHORS Martin Andelman Casey Cunningham Karen Deis Neill Fendly Thomas E. Jandt Victor Lund Stewart Mednick Bernie Navarro Marc Savitt Dennis Yu

Yes — Intended Consequenses!NEILL FENDLyNAMB

Will they eliminate what's left of our industry?

10

What are Realtors@ Demanding in Today's Market?CASEy CUNNINGHAMpresideNt, XiNNiX

Realtors seek those they know, like, and trust and who deliver results.

27

National Association of Realtors@ 2010 Survey ResultskAREN DEISloANofficertrAiNiNg.coMFirst time home buyers.

30

The Fed's LO Compensation Rule: Now What?THE NICHE REPORT

42

Seizing Control of Your RetirementbERNIE NAvARROpresideNt ANd fouNder,BeNworth cApitAl pArtNers Plan by investing in mortgages: Part V

24 DEPARTMENTS

09 FROM THE EDITOR'S DESk

37 MAN ON THE HILL

39 APPRAISER SOUND OFF

46 WHAT'S yOUR MORTGAGE IQ?

44 TIP OF THE MONTH

34 ONLINE LEAD GENERATION

54 LENDER & RESOURCE DIRECTORy

58 bRINGING UP THE REAR

AGENCy & FHA pg 49

COMMERCIAL pg 49

HARD MONEy & REHAb pg 50

JUMbO pg 50

REvERSE MORTGAGE pg 50

SERvICE PROvIDERS pg 51

16 Inflation: Fact or Fiction?THOMAS E. JANDT

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Published monthly by BODA Publishing, LLC PO Box 494, Bentonville, AR 72712 Phone: 866.964.2695 Fax: 703.991.2362 Email: [email protected] www.TheNicheReport.com

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The budget seems to be the hot topic this time of year. “The” can be a reference to national, state, county, municipal, business or household. Budget is budget, and it all is in the red. Origin of the word “budget” stems from a Middle English word bowgett; roughly from 1400 to 1450. This word is a deriva-tive of the Middle French word bougette; bouge meaning bag. The Latin origin is bulga, literally trans-lated as bulge. Back during the 1200s to 1500s when these word roots were derived, money was coin. Coins were carried in small sacks with strings that secure the opening and these were typically tied to one’s belt or hidden in one’s pocket. Either way, a small bulge was visible. The suffix “ette” is a reference to insignificant; small. Budget is, therefore, literally translated as a small bulge of money. Over the years, the balance and retention of these coins in one’s possession is how budget evolved to be the reference to balancing the “goes into’s” and the “goes out of ’s.” The goal is to retain a “bulge;” less coin, less bulge.

As ownership of the budget’s entity increases in size, the budget increases respectively. A household’s budget is miniscule in compari-son to a state budget. The “bulge” on a national level is monumental and beyond, in comparison to when the word was originated six hundred years ago. Today, however, the national level, state level, county level, municipal level and even some household levels of budget is negative; not only no coin in purse, but owing coin! Beholding coin to someone without payment in the Middle Ages, resulted in many gruesome penalties; physical maiming, sexual slavery, servitude, and forced possession acquisition. To live in deficit was unacceptable and frowned upon greatly. Kingdoms, states and lordships in debt would be defeated in battle because money could not fund necessary campaigns or defenses. No such thing as credit.

Fast forward to the twenty-first century and here we are; debt on every level in amounts unfathomable in relative comparison to six hundred years ago. And the punishment? Maiming, servitude and possession acquisition of this country. Our country owes to other countries. We have lost business to other countries. We fund battle campaigns against other countries we can not afford. We provide services to other countries without monetary compensation. We are in debt!

However, we change the rules to keep pushing forward. The treasury simply prints more money, inflating the economy. The govern-ment pushes budget cuts over ten or more years so the budget is balanced on paper. Our debt is carried over to the next fiscal year. The reality is that we have no bulge of coin tied to the belt of our nation. We literally have no budget. We balance debt, not budget, and threaten to shut down the government over what we do not have; coin. And again, we shirk the government shut down by only shutting down the non-critical functions; state parks, research facilities, administrative functions, etc. Law enforcement, emergent care, federal courts, military, social services, disability benefits and others would remain operational. How is this a threat of shut down? Basically, the blue collar working class functions would close, but the higher educated, skilled functions would still operate. Is this a prelude to repeat the history of over throwing England as King Richard I crusades in the Middle East in the 1100s? Or the beginning of the French Revolution against Louis XVI in 1791? Or the Russian Revolution of 1917? History has many similar anecdotes that parallel the potential situation in which this country is headed.

The bulge of coin is negative; actually a vacuum sucking the essence of livelihood out of our country. The standing of the political party that represents your lobbyist seems to have more clout to law-makers than the homeless veterans, foreclosed homeowner, and struggling mortgage professional. Imagine how well our country would be functioning if politicians, business owners and commu-nity leaders all operated under the basic principal of six hundred years ago: having and maintaining a proverbial bulge of coin on their belt as a mandatory requisite to holding a leadership position. We, then, would truly have a budget.

Cheers!

Stewart MednickManaging Editor

FROM THE EDITOR'S DESk

9TheNicheReport.com

MEMBEROfficial

As we all know the FED rule, after the recent Appellate Court ruling, goes into ef-

fect today. I have been significantly involved in this industry, working for NAMB and the Mortgage Broker for over 26 years. I spent many years, along with countless others, to turn

back the first HUD proposed rule, be an industry advo-cate and have some grasp of the DC process.

I have read the initial judge’s opinion which, in my opinion, is atrocious. Every claim made by NAIHP and NAMB was acknowledged and then dismissed in favor of the FED for the greater good. The fact that the Appellate Court upheld the judge’s decision speaks volumes about our industry.

The past mortgage meltdown which devastated the entire financial industry happened on the FED’s watch and they did nothing to stop any of it. NAMB made repeated efforts over the past 2 decades to get someone’s

attention about the lack of enforcement of the rules and regulations to no avail. I was honored to testify before congress many times on behalf of NAMB and if you look at those transcripts you will find our constant request for enforcement of the existing laws and thus, purging the crooks out of our industry. Obviously NAMB was ignored despite the fact we had nearly 38,000 members at the time and controlled well over 50% of the market. Nothing was done and instead a number of consumer oriented groups, regulators and members of congress worked on trying to pass even more regulation for the industry. I have no idea of their rational to proceed down that path when the current regulations were not being enforced.

The FED was going to make someone pay and the mortgage brokers were the target. Our industry has been blamed unfairly for the entire mortgage meltdown, has become very small in numbers and has few resources. In other words, we were a very soft target ready to be skewered.

by NEILL FENDLy

yES – INTENDED CONSEQUENCES! Will they eliminate what is left of our industry?

10 May 2011

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May 2011

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