Like most things in our world now, most people have their heads in the sand about our current financial crisis.  I think many people believe that it really is over even though unemployment is still hovering around 10% nationwide and is even higher in some cities like Detroit, MI.

I’m concerned about this mindset but not surprised.  I guess most people feel like there is nothing they can do about it so why worry.  Others are just clueless that it is even still an issue.

The bottom line is, the banks are still under extraordinary pressure to tighten up there books and get their balance sheets in order.  I don’t have all of the answers, but I do know that some are forcing, (maybe “Persuading” is a better word) many of their best customers, large performing commercial property owners, to refinance their loans with another institution.

Why in the world would a bank want to do this?
They need performing loans right?  I mean, that IS their job right?

Find worthy borrowers and projects that they can lend their investors’ money to.

Yes, that is their primary objective in normal times.  These are not normal times though.  In order for a bank to stay off the radar of the federal and state regulators, they need to have a large amount of cash reserves on their balance sheet.  That amount increases when they have troubled loans.  They have to sock more money away when people stop paying on their loans.

That my friend is why the banks call commercial performing notes due.  This allows the bank to raise the maximum amount of capital for one of their assets.

If you thought we were out of the “Banking Crisis”, check this out.

On Friday, Sept. 17th, there were 6 more FDIC Insured institutions shut down by federal and state regulators.

We have now reached 125 total closed banking institutions for 2010.

Apparently, these institutions were all NOT “Too Big To Fail”.

According to the FDIC website.

Maritime Savings Bank of Wisconsin had approximately $350 MM in assets.

Bramble Savings Bank of Milford, OH (Suburb of Cincinnati) had approximately $47 MM in assets.

In Georgia, three institutions were shut down and all three ended up going to the same acquiring institution.

Bank of Elijay, Elijay, Ga – $168.8 MM, in assets

First Commerce Community Bank, $248.8 MM in assets

The Peoples Bank, $447.2 MM in assets

The other bank that closed Friday was in New Jersey.

ISN Bank, Cherry Hill, NJ -$81.6 MM in assets

My question to you, are we just creating a larger number of midsize banks that may become “Too Big To Fail” themselves?
Or, are we in the middle of “Right Sizing’ the banking industry?

What should be done about the really big banks that were classified as “Too Big To Fail”?

Leave your thoughts below.

(If no comments section is below, click the title of the post up above and you will see the comments section).

How many more failed banks will we see this year?

Technorati Tags: Bank negotiation, Failed Banks

According to Bloomberg News,  Warren Buffett just predicted we will NOT see a double dip recession in the U.S. economy.

Berkshire Hathaway is up approximately 25% for this year while most companies are still down or only seeing single digit increases in stock prices.
Do you think Buffet’s comments are just him trying to have a “Self-fulfilling prophecy” due to the large stake he has in Wells Fargo or are we really on a solid path to recovery?

One thing is for sure, real estate is still hurting badly, both commercial real estate and residential.    Banks are still taking a beating and will be for quite some time.  Also, our unemployment numbers are still around 10%.  Hardly a recovery if you ask me… but I’m not an economist…

Some banks are still lending though.  Also, Fannie and Freddie are apparently doing basically 100% financing again for first time homebuyers.  This is very interesting.  I wish they’d do that for Commercial Real Estate. 

Also, there are a few hedge funds that are lending or purchasing Commercial Real Estate.  They are taking advantage of these low prices and you should too.  You need a down payment or an equity partner to use them to fund your deal… about 30% down, but they will generally do it if you or your team have experience and if the deal is big enough.

Want to know how to give  yourself the best chance of getting your commercial real estate deal or small business loan funded?

Go download my free report on ‘How to Virtually Guarantee Your Commercial Loan Gets Approved”

Make it a GREAT week!

Marshall

P.S.  If you have a great commercial property to sell, we might be interested.  Looking for Multi-Family, Student housing and Commercial Real Estate Performing Notes.  Notice, we are not looking for residential right now.

$3 Million to -$10 Million range.  Cap rate of 10-12+  Leave a comment below if you have something and I will contact you with more specifics.

Technorati Tags: commercial real estate, real estate investing

====> http://www.cnbc.com/id/35800892

According to this CNBC article, they are using non-payment as a business decision/tactic to try to save money.

I can’t say I blame them, but really, why did they insure the loans? Seriously, this brings up another question I have written about in the past.

Where were all of the “wise” and seasoned bankers when the frothy market was starting to peak? I really don’t understand this.
What do YOU think?

Leave some feedback.

Technorati Tags: real estate

I do not understand this logic at all.
We already have programs in place to help with affordable housing.
The banks already have loan modification/workout groups and loss mitigation departments.
The banks will already do a short sale which, many times is a better solution for the homeowner than a loan modification. (This is not legal advice either, but the options are there).

See the article below.
http://cli.gs/zgjTyz

The administration and the government as a whole need to focus 100% of their attention on how they can spur the private sector to expand and create more jobs.
The clues are right there in the article folks.
(Hint, it’s not going to happen if you increase taxes)

It is all about jobs, JOBS JOBS!!!!!

We can’t spend our way out of this by throwing money at more government programs and handouts!

The private sector can get the economy going again if they have access to funding.
Right now, they can’t get the funding they need so they are not hiring.
Thus, no one is producing anything and since 10% of the country is not working (Actually much higher if you take into account the number of people that are not looking for work right now), no one is buying anything.

Look at the housing sector. The only reason that housing has had an increase in anything is because of the tax credit for home buyers. Without that incentive (A tax reduction incentive) the housing numbers would be abysmal.

How is dumping more money to save someone’s underwater mortgage going to help the private sector?
The only people that will help in the long run are the government workers (Which we keep getting more and more of) and the BANKS!!!

The big banks all made money last year right?
What did the banks do to actually help the economy though? Nothing.
They did not lend any money out.
We the people forcibly loaned the banks money and they turned around and horded it and bought smaller banks to get more access to your money.

The government needs to help small businesses get more funding and then step back and get their hands off the economy. Don’t increase taxes, don’t overhaul our insurance programs which will increase taxes and greatly expand government. They just need to back off. Spending tax payer money just so you can say we are doing SOMETHING is just plain stupid. Obviously, the stimulus program has not helped. Over the last year, what has happened? Has the economy gotten better? Unemployment numbers haven’t.

One thing the government is doing that I support is they do have some programs to help investors supply affordable housing and to rehabilitate commercial properties. Why do I support this? Because it puts construction crews to work and it creates safe, affordable housing. This helps spur the private sector.

If you want to join me for a webinar on some of the available Government Funding Options for Real Estate Investors, enter your name and e-mail address below.
I’ll be holding an encore call on Tuesday night, Feb. 23 at 9:00 PM EST.

Technorati Tags: Build my IRA, commercial real estate, funding solutions, government funding, investing education, real estate, real estate financing, real estate investing, real estate riches

http://rapidreiresults.com/wordpress/?p=553

This latest post explains how to get the special report on funding commercial real estate deals with hedge funds, both for your own deals and for finding funding for other investors.
________________________________________
Thursday Feb 11th at 9pm eastern time. You MUST register
and I’d do it RIGHT NOW:

Check out this video from Marcus and Millichap president Harry Green where he weighs in on the state of commercial real estate.

Back to our webinar info:

Here’s what you’ll learn:
UPDATE: **************************
Sign up now and get access to the replay webinar.
You will be automatically sent the information to get to the replay, plus the special report will be sent to you.
*********************************

* How to enter the secretive realm of the
hedge funds, to connect them with money making
opportunities right in your neighborhood right now

* How to benefit from the commercial real estate
crash, without investing a dime in buying or selling
properties

* How to find deals with almost no work, so you
simply introduce someone to a private equity
fund or hedge fund and get a guaranteed
commission that can be enormous

* How to find a lender as opposed to yet another broker.
The difference? You’ll have access to the direct
decision-makers on the loans you want funded. And
they’ll have access to private equity and hedge fund
investors because everyone is participating in the
loans, not brokering them to someone else

* How to submit a deal so that there is no further work
required on your part

* A simple “back of the envelope” way to know
that a deal is likely to fly, and when it’s not.

* What makes a good deal or a bad deal

* How to go to networking meetings and find deals
right and left

* How to connect applicants with lenders with a simple
two page form guaranteeing you will get paid, so that
is ALL you have to do, you’re done, and someone else
makes you money while you move on or pursue your hobbies
and spend time with family.

* How to make the big money in “commercial
loan modifications” and “workouts”

Register for the webinar here:

BTW. This training webinar alone is easily worth thousands to a
person who is willing to take the action steps and there MAY not
be ANY replay:

Full Disclosure: While Richard and I are covering a ton of great
stuff on the call, he can’t possibly teach you everything you
need to know in a 1-2 hour webinar.
There is an offer at the end to get further training and support
from Richard and his team. If you decide to purchase his program,
my company will be compensated and you’ll be helping me feed the
children (The Moreland Children, 4 with a 5th one on the way .

Get this though, if you decide to purchase the program, I’m going
to include a very special bonus to help you with your online
marketing as well. You’ll be able to apply this bonus to ANY
type of business you are doing online.
Remember though, there is no obligation to purchase anything
and the webinar alone is going to be worth some serious money.

Technorati Tags: Bank negotiation, commercial real estate, government funding, investing education, real estate investing

Unless you get direct updates from the FDIC, you probably haven’t heard this yet. SIX (6) banks went belly up on Friday. That is a total of 15 for the year!! Last year, we only lost 140. Yeah right, ONLY 140. That was a HUGE number. This year is going to be an even bigger year of banks closing. I’ll bet that we see between 200-250 banks get shutdown.

So… WHO do you think is the most motivated seller out there right now? They don’t want you to know it and they put up a great front, but the banks and other lenders are the MOST motivated sellers for today and likely for the next 2-3 years. Why are they so motivated?

It’s simple actually, but not intuitive. The banks are getting hammered by the FDIC right now, so much so, the FDIC can not even keep up with the numbers of banks that they need to close. If the FDIC had the manpower and a way to handle it all, they would likely get it all over with quickly like ripping off a band-aid… but they can NOT handle all of the volume.

The Office of Thrift Supervision is one of the agencies that goes in and examines the banks’ books. If the bank is found to be out of compliance in the number of performing loans to non-performing loans and the amount of cash on hand, they have serious consequences.
So serious in fact, if the deficiencies are not corrected quickly, they come in and close down the bank. That is why you can bank on at least 2-5 banks closing on any given Friday right now.

What’s even worse, to help correct the issue, banks are calling commercial loans due to build up their cash reserves. The strange thing is, they are calling the PERFORMING LOANS due!!! They are then taking significant discounts on even performing loans just to raise cash. The reason the call commercial loans due is because they CAN. It is written into most of the commercial loans out there that the bank can call them due.

So, how can YOU take advantage of this situation?

If not more importantly, how can you HELP in this situation? Well, you and I are not going to fix this problem ourselves, it is just too big. However, there are several ways to help sellers, the banks and your own wallet in this economy. First, you need to arm yourself with the knowledge and the capital to get it done.

Good news!! If you are already dabbling with commercial real estate, or you think you’d like to, there are many ways to get involved. I suggest start small, learn the language and get relationships.
I will be hosting some webinars over the next several weeks to help you in that education process.

Also, if you missed my webinar on Thursday night, go below for the encore call.
You’ll see why once you get a chance to see it.

My guest has a way to accelerate your involvement in commercial real estate by hooking you up with funding straight from Government agencies that MUST lend this money out. In fact, they added an additional $4.5 Billion to this amount in 2009… Tons of it is still available.

If you tried to get on the call Thursday and couldn’t get connected, I would like to apologize. We had an issue with the original webinar link so we had to create a new meeting. A few people e-mailed me to let me know they connected but only saw a blank screen. So, I’m very sorry about the issue. To make up for it, Tuesday night I’m hosting an encore webinar.

Anyway, enter your name and e-mail address below for the replay.

***************************************************
Enter your name and e-mail address here for access to the encore of our webinar on Government Funding Solutions for Investors and Developers. It happens Tuesday, February 23rd at 9:00 PM EST, 6:00 PM PT.

***************************************************

We covered a TON of the questions that everyone sent in during the registration, and some of mine, too.

Of note, Sean went over:
• Low Income Housing Tax Credits
• HUD Programs
• Section 8
• The effect of the economic stimulus bill on us investors
• What the foreclosure bill has done to the market
• How much government money is available to us
• Soft financing programs
• Real live case studies
• And so much more

Full Disclosure: While Sean covered some great content on the call and there is no charge for the webinar, he can’t possibly teach you everything you need to know in a 1 hour webinar. There is an offer at the end to get further training and support from Sean.
If you decide to purchase his program, my company will be compensated and you’ll be helping me feed our children.
Just need to let you know that.

Technorati Tags: Bank negotiation, funding solutions, government funding, real estate, real estate financing, real estate investing

You have found your perfect deal. Now you are looking for a government grant or program to help you out.

This all requires a great team. Who is on your side?

My most common response to many who ask the question is that make sure you have a lawyer and accountant who know more than you.

Don’t get into a position where you need to educate your vendors.

Having a quality lawyer can get your deal closed that much quicker, while having a quality accountant can make sure your finances are in order.

A few questions for your potential staff:

Are you familiar with Government Financing?
Have you closed any subsidized transactions?
Do you know anyone from the allocating agency?
At least 2 of the three questions should be “yes” and should help you to make an informed decision. You may also want to inquire about the program you are seeking as well.

Count it as a bonus question!

–

Sean Carpenter is the nation’s leading expert on Government Deal Funding for Real Estate Investors and Developers and has spent the last 12 years both consulting and getting funding for his own deals. I’ll be offering an encore webinar of a special interview with Sean coming up on Wednesday, February 24th at 9:00 PM EST, 6 PM PT where I’ll be asking him about what’s involved in getting funding for your deals courtesy of Uncle Sam.

Find out more and pre-register for the call by entering your name and e-mail address below:

______________________________
Material Connection Disclosure: If you click on a link on this website, you may be using an affiliate link. This means I may be compensated if you purchase something from the company on the other end of the link.

Disclaimer: This is not legal advice or even financial advice. The opinions and information here are written to entertain and inform you of my experiences from Real Estate Investing. I can’t possibly know your financial situation or whether you will have the ability, motivation or determination to put forth the effort that is required to put a system or idea in motion to profit from it.

Before embarking on any business venture, you should consult with your financial advisor, accountant, lawyer and other professionals to help you determine if it is a worthwhile venture and to discuss the risks. I make no claims about how much money YOU will make with any of the information shared here on this site or any other website or e-mail that I may send you.

As in ANY business, your results will vary based on your own knowledge, determination, motivation and financial resources available to you.
____________________________________

Technorati Tags: Foreclosure, funding solutions, government funding, investing education, Loan Mod, real estate investing, realestate, tax credit, Wholesale real estate

Are you finding deals are getting tougher to close with the new restrictions banks are pushing on applicants?

Is it taking longer to get a deal done? Have you stopped looking for new projects to acquire?

The last year has been a very difficult period in real estate history. Some markets have declined upwards of 50% in value with no light at the end of the tunnel. Not very good news if you started your “buy and hold” in 2007, but will certainly work better for you now in 2010 as you pick properties up for a fraction of their price two years ago.

Not to mention cap rates are heading into the two digits in larger metropolitan areas. For some, this is an area of the market they have never experienced.

So what can we do to get some of these declining assets?

The banks that were lending up to 125% a few years back have either left the market or cap an acquisition at 70% loan to value. The remaining 30% is up to the investor. But raising the 30% slows down transactions and your friends in Congress have attempted to help.

In July 2008, the President signed the Housing & Economic Recovery Act (HERA), which among other things, provided $4.5B to all 50 states, some territories like Puerto Rico and the Virgin Islands, and the District of Columbia, to combat neighborhood declination by foreclosure.

These funds, known as the Neighborhood Stabilization program, were supposed to help investors, both for and non-profits, buy and rehabilitate foreclosed buildings in order to prevent the stable households from losing too much value. In February 2009, Congress added an additional $4.5B to the program, now known as NSP II, to further carry out the NSP mission.

This is nothing new. The federal government has been investing in real estate for years, at least since HUD was conceived during the Johnson administration in 1965 as part of the Great Society initiative.

HUD allocates through the individual States and territories upwards of $20B per year to facilitate economic development and housing activities. Additionally, many states have programs of their own that can match federal funds in addition to over $5B in tax credit programs available to stimulate acquisition, rehabilitation and new construction of real estate projects.

Buying and holding certainly isn’t what it used to be, but now the government wants to help you out more than ever. You just have to know WHERE to find the money and HOW to get the funds.
–

Sean Carpenter is the nation’s leading expert on Government Deal Funding for Real Estate Investors and Developers and has spent the last 12 years both consulting and getting funding for his own deals. I’ll be hosting a special interview with Sean coming up on Wednesday, February 24th, 9:00 PM EST. Find out more and pre-register for the call by entering your name and e-mail address below:

UPDATE: Since this webinar was a few weeks ago, if you register below, I will send you the encore webinar information as soon as you confirm your e-mail address.

______________________________
Disclosure: If you click on a link on this website, you may be using an affiliate link. This means I may be compensated if you purchase something from the company on the other end of the link.

Disclaimer: This is not legal advice or even financial advice. The opinions and information here are written to entertain and inform you of my experiences from Real Estate Investing. I can’t possibly know your financial situation or whether you will have the ability, motivation or determination to put forth the effort that is required to put a system or idea in motion to profit from it.

Before embarking on any business venture, you should consult with your financial advisor, accountant, lawyer and other professionals to help you determine if it is a worthwhile venture and to discuss the risks. I make no claims about how much money YOU will make with any of the information shared here on this site or any other website or e-mail that I may send you.

As in ANY business, your results will vary based on your own knowledge, determination, motivation and financial resources available to you.
____________________________________

Technorati Tags: Build my IRA, Cincinnati Real Estate, First Time Home Buyer Tax Credit, first time homebuyer, funding solutions, government funding, Home prices, investing, investing education, Loan Mod, Out Of Area Owners, private investors, private lenders, private lending, private money, Property Inspection, Property Values, real estate, real estate financing, real estate investing, realestate, Retirement Savings, Short Sale, short sale invest, short sale investing, short sales, shortsale, tax credit, Virtual Investing, webinars, Wholesale real estate, Wholesaling Real Estate

When you do, I will also send you a 100 Page E-book titled “Beginners Guide to Internet Marketing”. While it is not Real Estate Industry specific, it will give you a great overview of how to use the Internet to market your business.

It is geared more for someone that wants to start making money online, but the concepts translate very well to Real Estate or any business that is not getting enough traffic from their online efforts.

So, sign up below and I will rush that 100 Page E-Book over to you…It’s free, at least check it out.

Technorati Tags: Finding Buyers, Foreclosure, Foreclosure prevention, government funding, Hiring Contractors, Internet Marketing, investing, investing education, Marketing for Buyers, Marketing Properties, Online Marketing, private investors, private lenders, private money, Property Inspection, Property Values, real estate, real estate investing, Retirement Savings, Short Sale, short sale investing, short sales, shortsale, Virtual Investing, webinars, Wholesale real estate, Wholesaling Real Estate

http://www.hud.gov/offices/hsg/sfh/waivpropflip2010.pdf

The 90 day seasoning rule was instituted to try to keep “Illegal flips” from occuring. I have “illegal” in quotes because it is only illegal if someone is committing fraud by getting an appraiser to appraise the property for MUCH higher than the real value of the property.

This is totally illegal and I’m pretty sure you can be put in jail for that. Again, I’m not an attorney so don’t take my word for that.

However, the way most of these transactions are happening is this. An investor purchases a property either from a bank or from a homeowner in distress at a substantial discount because of the distressed situation.

Banks do NOT want to spend money to fix up foreclosed homes.

Homeowners that are having trouble making house payments do not want to make repairs either. They are struggling just to pay their bills.

Why would they continue to repair a home they are likely going to lose in foreclosure anyway?

So these properties NEED an investor buyer to step in and buy the home and rehab the home back to move-in ready condition.

Well, in these times of tight credit, it’s next to IMPOSSIBLE to get a decent rate on a long term loan for an investor. So, rather than holding the property as a rental, the investor fixes up the home using high interest loans.

The investor then turns around the property and finds an end buyer that wants to live there. Typically, the end buyer still gets a really good deal on now an updated home rather than a distressed property.

Well, when FHA decided to implement the 90 seasoning rule, that eliminated a TON of buyers, especially first time home buyers that typically rely on FHA programs to get in with low down payments.

They don’t typically have extra money to fix up a home.

So, I welcome this change for everyone involved. It is going to speed up the acquisition of these distressed properties because now the investor will have an easier time finding a buyer.

What do you think of this plan?
Leave some feedback below.

Technorati Tags: Bank negotiation, Build my IRA, Bulk Real Estate, Bulk REO, Cincinnati Real Estate, Determining Property Values, First Time Home Buyer Tax Credit, first time homebuyer, forbearance, Foreclosure, Foreclosure prevention, funding solutions, government funding, Hiring Contractors, Home prices, investing, investing education, lender Negotiation, preforeclosure, private investors, private lenders, private lending, private money, Property Inspection, Property Values, real estate financing, real estate investing, realestate, Retirement Savings, Short Sale, short sale invest, short sale investing, short sales, shortsale, tax credit, Virtual Investing, webinars, Wholesale real estate, Wholesaling Real Estate