Thursday, December 20, 2007

Real Estate: Negotiating

You may be saying to yourself that the part on mentoring on my previous blog posting is very self serving, because I happen to specialize in One-on-One Mentoring - let me address that for a moment.

I have always said that creative real estate isn't rocket science, you could figure it out on your own, but how many failures are you willing to accept before success?

There is an old saying that "time is money", and nothing could be a greater truth. There is a learning curve to everything in life, especially in real estate, but after that is accomplished it comes down to knowing how to negotiate, Negotiating is a "million dollar skill" few have grasped it fully. I have seen numerous investors leave far too much money on the table, or negotiate a deal that leaves them 1 vacancy from financial disaster. The moral of the story is this- find a mentor to take all your deals to the next level for maximum leverage and profit.

I would like to end this entry by giving you 3 negotiating tips!

  1. Never need a deal that bad that you are willing to compromise your invest plan! So many investors will do a deal just for the sake of doing one; they pull the trigger with the shot gun blast mentality, hoping to hit the perfect deal.
  2. Be Prepared: Know what you’re talking about. Do your comps, fix up estimates, estimate down side potential, know the players, know what you going to do with the property ( know your exit, before you go in the entrance ) – this is essential before you start negotiating.
  3. Never loose control of the negotiations. If you find yourself loosing control, excuse yourself for a bathroom break, if you’re on a phone negotiation put them on hold with the excuse that you need to find vital documents that will impact the subject matter. Of course, this is just a stall tactic for you to gather your thoughts and get back in control.

Hope this helps and till next time – be well.

James Gage

Saturday, December 15, 2007

Why Real Estate Investors Don't Use Lease Options

I have been using lease options effectively for over 20 years and found there is little competition from my fellow investors. Why you ask? I believe it's a 2 fold reason.
First, with all the cable programs on flipping homes for huge profits ( which I question ), most investors are caught up in the moment. No, I don't doubt there is money to be made in flips, but along with it comes great risk. In fact, in my early days of investing I did a few myself for a nice profit, but at the end of the day the frustration and possible down side exposure was not worth it for me.

Which brings me to reason 2. Most investors do not have the proper information to do a successful lease option and mitigate their exposure, A.K.A. cross your t (s), and dot your I (s). Some believe all you have to do is read a book or listen to an audio presentation and your off to the races. Nothing could be further from the truth. What you need to perform a successful lease option or any other real estate transaction for that matter is : 1. Specialized Contracts ( never use generic contracts), 2. Iron Clad Disclosures (prevent regret and litigation ), 3. Someone who will take you by the hand and walk you through the first couple of deals to insure maximum profit and leverage!

Imagine a strategy that allows all the benefits of ownership without owning the property - what else could one ask for? Please explore lease options as a tool for your real estate investing arsenal. Until next time, may all your deals be profitable.

Wednesday, December 12, 2007

Tip of The Week : Short Sales

Short Sales are the buzz in most real estate arenas today, but do you know how to profit from them?
One of the most important components of any successful short sale is what should you initial offer be or counter offer. Did you know most short sales fail and no counter offer is offered by the bank or mortgage company because the initial offer was much to low!
So what do you do? Do you just pick a number out of the air and pray that things work out, and that your offer is accepted? Why no! If you have been a reader of my tips and newsletter over the years, than you know I have a formula I use to make my initial offer or counter offer, if the bank has prepared a price ahead of your offer based on their BPO (Brokers Price Opinion).

Here is the formula that I have been using over the past 4 months which has served me very well and increased my equity position:

Here it is...

Step 1: I take the estimated or actual BPO amount or the value of the house, based on the comps then multiply that number by 65%.


$175,000 (Estimated BPO value) X 65% = $113,750

Step 2: I then take the number I got and multiply it by 92%


$113,750 X 92% = $104,650 INTIAL or COUNTER OFFER

Hope this helps.

PS: Don't forget our Holiday sale of 35% off of all our products. Just visit our website below, click on "Products" and enter promo code 777 at the check out form - Happy Shopping.

Be well,

James Gage

Friday, December 7, 2007

Gage Consulting Group Holiday Sale

The whole team at Gage Consulting firmly believes one of
the best gifts you can give your loved ones, acquaintances
or even yourself, is the gift of education.
We are delighted at the stories we receive daily by email,
fax, letter and phone, telling us of successes clients
have had with the products we make available.

In keeping with our Holiday Specials tradition, this year
we are offering incentives on all of our educational
items, including our unique One-on-One Mentoring program.
As our Holiday Specials this year, we are offering 2
great deals. First, take a whopping 35% off any of
our Home Study Courses, CDs, DVDs or Package deals.
Secondly, we are offering a $1,000.00 discount on our
3 month,6 month or 1 year mentoring programs, which
includes all our valuable resources, contracts, manuals
and software!

These specials are available until the end of the year.
Please note that on our on-line order form, the standard
prices will show, but until December 31, 2007,the
discounts will automatically apply by entering:
Coupon Code 777 and you will be charged the lesser
So, you have until the end of the year to make use of
these deep discounts - order today !

On behalf of myself and Gage Consulting Group have a
Happy, Safe and Prosperous Holiday Season.

If you have any questions please do not hesitate to call
me at 508-595-9567.

To your success,

James A. Gage

Is The President Helping The Sub Prime Industry?

Hello All:

Yesterday President Bush unveiled a plan to control the hemorrhaging in the sub prime loan industry, but truth be told it's just another example of smoke and mirrors! There are so many hoops for people to jump through that at the end of the day only 15% of the loans will be rescued, and that will only postpone the inevitable for 5 years down the road.

So the moral of story is that the melt down will continue with a second push of defaults scheduled for 5 years from now. How can we rebound and find a bottom to this market if we have scheduled another down turn 5 years into the future? I have posted the article below for your review.

Be well,

James Gage
PS: Now is a great time to start investing, if you are a leveraged investor - find out how by requesting our FREE newsletter.

No Quick Fix for Subprime Mortgages

Posted: 2007-12-07 12:23:14
WASHINGTON (AP) - Be ready to wait if you want to get information from a toll-free hot line about freezing the interest rate on your subprime mortgage.

Minutes after President Bush outlined a plan to help strapped homeowners, callers were told to have patience until a counselor could answer their questions and "devote as much time to you as necessary."

But, once they do get through, homeowners may not find the answers they sought.

One caller to the hot line (1-888-995-HOPE) was told there would be "lots of hoops to jump through" to obtain the five-year freeze. The rate hold goes to the heart of the relief effort for people with subprime mortgages, which are loans offered to borrowers with tarnished credit or low incomes.

Even President Bush acknowledged the plan is "no perfect solution." Treasury Secretary Henry Paulson said it was not a "silver bullet."

Only a fraction of the homeowners who face huge jumps in their mortgage payments appear likely to be helped by the plan, negotiated by the Bush administration, to freeze the low introductory rates on their subprime loans for five years. After that, they could be in the same position again.

Homeowners dialing up their mortgage company to get their current rate frozen could be disappointed. The White House plan does not force mortgage companies to give eligible homeowners a break. It is voluntary.

The White House on Friday defended the system and its eligibility requirements.

"I wouldn't call them `hoops,"' White House deputy press secretary Tony Fratto said. "I think we are trying to make sure, as we outlined yesterday, that we're getting at the right population that can best be served by this program."

Bush promoted the initiative Friday for the second day in a row, using his weekly radio address to call it "an example of the government bringing together members of the private sector to voluntarily address a national challenge - without taxpayer subsidies or government mandates." The president taped his address for Saturday airing, and the White House released the transcript on Friday.

In first announcing the initiative on Thursday, Bush said 1.2 million people could be eligible for relief. Aid includes the rate freeze and helping people refinance into more affordable mortgages. The Center for Responsible Lending, a group that promotes homeownership and works to curb predatory lending, estimates that just 145,000 families will qualify for the rate freeze. The criteria are too strict, it says.

The White House plan is aimed at stemming foreclosures, which have shot up to record highs as the housing market has gone from boom to bust.

Subprime borrowers have been hardest hit by the meltdown. Initially low interest rates that reset to much higher rates have clobbered those borrowers. Nearly 2 million adjustable-rate subprime mortgages will reset from introductory rates of around 7 percent to 8 percent to much higher rates this year and next. That raises the specter of even more people being forced out of their homes because they cannot keep up with their monthly payments.

Rising home foreclosures are a headache for politicians and a danger for the economy.

Bush tried to shift blame for the crisis to the Democratic-led Congress.

"The Congress has not sent me a single bill to help homeowners," Bush said.

One measure would give the Federal Housing Administration more flexibility; a second would change the tax laws temporarily to help people who have a portion of their mortgage forgiven by banks.

Sen. Charles Schumer, D-N.Y., complained the criteria for Bush's mortgage freeze are too narrow to help most distressed homeowners and worried that legal challenges by investors might stall the effort.

"While we certainly all hope this will be a shot in the arm for the housing slump, it is hardly a panacea," Schumer said. "There are too many families who may be left out, too much left up to the voluntary willingness of the private sector and too little disclosure and transparency to ensure families who do qualify are being helped."

Under the plan outlined Thursday, the rate freeze offer would be available only to people who have not missed any mortgage payments at their introductory interest rate. It also only would apply to loans taken out between 2005 and this past July 31 and scheduled to rise to higher rates in Jan. 1, 2008, and July 31, 2010. To make sure speculators don't get the break, the rate freeze offer applies only to people living in their homes.

The idea behind the administration-negotiated plan is that the five-year freeze will buy time for the housing sales and prices to start rising again. Such a rebound would enable homeowners to refinance their current adjustable rate mortgages into fixed-rate loans with more affordable monthly payments. But some people who want to buy homes and have been priced out of the market are upset that there's no help in sight for them.

Of the nearly 3 million subprime adjustable-rate loans surveyed by the Mortgage Bankers Association in the third quarter, a record, 18.81 percent of them were past due. A record, 4.72 percent of the loans entered into the foreclosure process during that period.

Meanwhile, there still is the possibility that investors, who were counting on bigger returns from the higher rate resets, will balk at extending the duration of the lower rate.

George Miller, executive director of the American Securitization Forum, whose members include investors, ratings agencies and other financial players, backed the White House's effort and developed streamlined procedures for lenders to follow when sorting through borrowers' requests for relief. He was hopeful lawsuits could be avoided, but he struck a note of caution.

"Certainly, there is no complete insulation from legal exposure," Miller said.

Wednesday, December 5, 2007

Another Bright Idea !

Hello All :

I was going through a list of articles today and I couldn't believe my eyes! Yes, it's true our national financial gurus/advice givers have come up with another brain storm - "use your credit cards to pay your rent" ! As sited in the article below the premise is to charge your rent to your card and pay it off each month if you are in good financial shape, and capture the rewards points.

There is a number of flaws in this thinking: 1. Most people who are in good financial shape do not rent, but rather own property, 2. When you run up your credit, even if you pay it off at the end of the month affects your FICO score, 3. Most people do not have the discipline to pay off their card each month, so aren't we creating another financial tsunami, or it least adding to the coming credit one?

As most of you know, who have been a reader of this blog, I called this sub-prime tsunami 12 months before it happened. I am now forecasting 2 more I see on the not to distant horizon:
1. Credit & Credit Card Collapse: When people have to pay the mortgage to keep their homes, they live off their credit cards for food, clothing, utilities etc. Eventually the money runs out and not only due they default on credit obligations, but the home loan is not far behind, so be on the look out for another down turning in housing.

2. The US Dollar: We are in deep trouble folks! Not only are super models asking to be paid in Euros, but for the first time in history the Canadian Dollar is at parody with the US Dollar. I read recently that Canadians are traveling to the Northeast US for vacations because they get more for their dollar! Unfortunately we are part of a global economy losing our sovereignty bit by bit each day. The Chinese have threatened to blow up our economy by pulling out of the US Dollar, the Arabs are talking about switching from the US Dollar to the Euro has their stand for oil trading, and the icing on the cake- the Federal Reserve is posturing to cut interest rates again. You my be saying, Jim, that's great cutting interest rates will help the economy right? Wrong! It will further weaken the dollar, and cause our resources to become a "K-Mart blue light special" for foreign investors.
Finally, to illustrate how the dollar has lost much of its value ponder this. In 2002 the Euro was worth .88 to the US Dollar, 5 years later the Euro hit a high of $1.50 against our dollar.

So as you can see in order for you and your family to survive this unwanted restructuring of our
countries finances, you must become a leveraged investor through short term investing. Please visit my web site and learn about these exciting avenues of financial security.

Be well & to your success,

James Gage

Financial tip of the day: Charge the rent to your credit card?

Charging the rent to your credit card sounds insane -- it seems like it would be the eighth deadly sin, tied with going to a payday lender to get gambling money.

But as the New York Times points out, the strategy can be great if you're in good financial shape: If you pay off the balance each month you pay no interest, and you can rack up rewards on your credit card -- possibly round-trip airfare anywhere in the country each year if you have high rent!

Tuesday, October 30, 2007

Reasons to Use a Land Trust

31 Reasons to Use a Land Trust

1. Avoids property being probated (out of court transfer upon death of beneficiary)

2. Ease of Transferability

3. Judgments do not attach to the beneficiary

4. No Partition (avoids spouse’s “forced share” sale buyout upon divorce)

5. Easier management with multiple owners (multiple owner do not have to sign docs)

6. No costs upon transferring beneficiary

7. No registered agent needed

8. Legal and Equitable property interest in trustee’s name (never be in the "chain of title")

9. Income and Expense conduit, not a business with tax consequences

10. Trustee has no personal liability

11. No annual fees like other entities, if trustee is an individual or friend

12. Estate planning benefits – automatic successor beneficiaries

13. Less expense with grantor creating the trust entity

14. Avoids the due on sale clause (lenders never know what happened)

15. Privacy of ownership (no recordation of the Trust Agreement) Helps avoid Identity Theft of your name

16. Keep sales price private

17. Able to fracture interests of multiple owners without being "partners"

18. Ease of linkage to other asset protection entities

19. Non-judicial repossessions of real estate sold on installment contract

20. 1099 not required for transfers (personal property not subject to real estate regulations)

21. Ease of operating across state lines

22. Lots of case law to support land trust administration

23. Many attorneys do not study this section of the law – not profitable for them (yields a competitive advantage)

24. No recordation of the Trust Agreement

25. No tax return to file (pass through entity)

26. To avoid “seasoning” problems (secondary market rules of ownership)

27. To save title insurance premiums (Trustee-insured-remains the same)

28. Good negotiating technique in the sale or purchase of property (Disney World used land trusts to acquire its property prior to avoid price escalation)

29. To provide non-recourse financing

30. Lowering of real estate taxes (prevents re-assessment)

31. Avoids state regulations that apply to corporations and LLC’s

As you can see, Land Trusts are a wonderful tool for you to use to hide your assets, avoid real estate tax increases, privatize your sales transactions, avoid probate and use for many other benefits. Now that you have a basic understanding of why
people use Land Trusts, please consider acquiring our Land Trusts Made Easy Home Study Course.

You will be amazed at the logic behind how to structure your Trust Agreement so no one but YOU understands what is going on. At the end of the course we give you all of the forms needed to create and maintain your own Land Trusts.

This is available by going to: clicking on “Investing Tools” then clicking on one of the “Package Deals” tabs.

Are you working hard to acquire your assets? You will spend a life time building your financial estate…spend a little time and money learning how to protect your net worth from the deadbeats and their contingency fee lawyers!

Please visit our website at You can read even more about Land Trusts and how they benefit you.


Monday, October 22, 2007

Tomorrow Nights' Webinar

Hello All:

Just a quick reminder to let you know we only have a few lines remaining for our webinar tomorrow night - hope to see you there...

Tuesday, October 23, 2007 - Special Webinar with

Time: 9:00 PM EST

Topic: "How to Use Lease Options with Foreclosures!"


* Only 200 lines available- Register NOW !

Friday, October 19, 2007

As I Predicted in June

Hello All:

As predicted this past June by me, while speaking in VA:

Dow Plunges Nearly 375 on Recession Fears- AP Stocks pulled back sharply Friday as lackluster profit reports, record high oil prices and a warning from Caterpillar that the housing downturn was spreading to other parts of the economy raised fears about the economy’s long-term strength.

Again fellow investors this is a great opportunity to invest with lease options, short sales and Probates. Drop by my website to sign up for a free newsletter and other valuable tips.

Monday, October 15, 2007

Upcoming 1 Day Training

Saturday, November 10, 2007 : 8:00 AM -5:00PM- Worcester, MA

Massachusetts Real Estate Investors & Apartment Owners Association

Topic : 1 Day Training On : Lease Options, Short Sales & Probate Investing

Where: Crown Plaza, Central Street, Worcester, MA

Friday, October 12, 2007

Short Sale: Tip of The Week

Hello All :

When doing short sales, always ask the bank or mortgage company for their short sales package. Never assume that you know what they are looking for, even though you may be correct.
You want to deal with their process and their format, so things will going smoothly - remember pick and choose your fights carefully, and never use generic templates.

Also, please visit my website and click on investing tools for the latest and best aids to help you in your investing.

Blog you later.

James Gage

Sunday, October 7, 2007

Upcoming Training Event

Hello All :

Hope this finds you and yours well. I'm back from enjoying a little snook fishing in NE Florida, so I thought I would post my next training event with the folks at before its' back to mentoring and investing.

Blog you later.

James Gage

Tuesday, October 23, 2007 - Special Webinar with

Time: 9:00 PM EST

Topic: "How to Use Lease Options with Foreclosures!"


* Only 200 lines available- Register NOW !

Thursday, September 20, 2007

Mr. Bernanke - Thanks A lot !

In previous articles, I stated how my research suggests the Fed’s interest rate cut this past Tuesday will likely do little to stimulate economic growth and will serve only to increase inflationary pressures. The truth is that the rate cut will help make mortgages cheaper to get , but it won't do any good because underwriting guidelines are still going to be unbelievably tight for most applicants.

Another example of smoke and mirrors.

Blog you later.

James Gage

Tuesday, August 21, 2007

U.S. Foreclosures Rise Sharply in July


AP -

Foreclosure filings rose 9 percent from June to July and surged 93 percent over the same period last year, with Nevada, Georgia and Michigan accounting for the highest foreclosure rates nationwide, a research firm said Tuesday

Friday, August 17, 2007

Lease Options: The Answer to A Mortgage Emergency!

Hello All:

Well, here we are in the thick of what I have been warning for over 15 months- the sub-prime meltdown. Many have said that this would not spread into the rest of the economy. Guess what? It has; what's my evidence to prove this assertion? The Federal Reserve has been burning the midnight oil to print 37 billion dollars to infuse into the market; Country Wide is on the verge of bankruptcy the dollar is weak against all major currencies.

This is a perfect opportunity to put Lease Options to work! If people can't sell their homes and can't afford mortgage payments, they will only have 2 alternatives: 1. fall into foreclosure or 2. do a lease option. Sounds too simplistic to you? Sign up for my newsletter, or give me a call and I will explain this strategy in detail.

Be well,

James Gage

Friday, August 3, 2007

Lease Options: Latest News On Financing

Hello All:

Did you see the latest news on financing? It seems that a majority of lenders are clamping down on mortgage underwriting causing individuals seeking mortgages to be turned away in droves! Case in point Wells Fargo : Lenders are tightening standards and "raising rates like crazy." Wells Fargo & Co. is charging 8 percent for a prime jumbo 30-year fixed-rate loan that carried a 6 7/8 percent rate late last week.

This a great opportunity for those of us that invest with lease options; we can tap into this market for maximum profit. You see, I believe it will take about a year or so for the mortgage market to shake off and forget about this sub-prime melt down; when they see that their profits have taken a hit because of tightening practices- they will ease.
At that point individuals we have in lease options will be able to exercise their options and get financing.

Until next time be well and let's get out there and make some money!

James Gage

Wednesday, August 1, 2007

Real Estate : Russ Whitney & Robert T. Kiyosaki Want You To Be Rich!

We are enjoying the summer days this week at Cape Cod, Massachusetts before returning to NE Florida for some snook fishing at the end of the month. I love Summer mornings. I take my early morning walk, shower, drink freshly ground coffee and watch CNBC.
This morning, there was a special real estate magazine section with tons of glossy ads in my regions newspaper from Donald Trump on condos for sale. I usually go through this stuff pretty fast, but then my brown eyes came upon a major article entitled “Russ Whitney wants you to be Rich”© by Randall Patterson.
The article had the usual stuff you read in the blogs about Russ Whitney and his rags to riches story as well as his friendship with Rich Dad Poor Dad author Robert T. Kiyosaki. The article then begins to describe Russ Whitney’s introductory seminars (4700 per year) which start out free and then move the clientele up the pyramid from $4995.00 to $54,000.00 in program costs. The article also stated that 280,000 people attend per year and 22,000 enroll in the advanced courses. Even though I still use my fingers and toes to count , this is a great deal of money!
.On one hand, the organization boasts having “helped thousands of people become wealthy”, yet it took the reporter several weeks to get the company to provide 1 students to speak with him. When they provided the contact, the reporter discovered they were all employees or doing business with the Russ Whitney organization. With this volume of training which Russ Whitney has accomplished, I wonder why he just didn’t provide a few students who could vouch for his veracity? Easy enough to do.
I find it strange that my real estate competition always has problems in this area, I also advertise the following “Call me, I will be very happy to speak with you”.
No big deal, go to my web site read my e-Books and articles. If you have interest in working with a Mentor, then give me a call at (508) 595-9567 and see if you feel that I can part of your One-On-One Success.

To your success,
James Gage

P.S. I just read an interesting news release on Google stating that the Russ Whitney Organization signed a six-year lease on a 32,646 square foot building in Utah for 200 employees and $700,000.00 in furnishings for student coaching. The news release also stated that Rich Dad Poor Dad author Robert T. Kiyosaki and others attended the ribbon cutting ceremony. What’s the quote from Alice in Wonderland “Curiouser and Curiouser”

Tuesday, July 31, 2007

Foreclosures: Stocks Lose Steam on Subprime Worries

Stocks Lose Steam on Subprime Worries
Tuesday July 31, 2:35 pm ET
By Madlen Read, AP Business Writer

Wall Street Rally Fizzles As American Home Mortgage Problems Revive Subprime Anxiety

NEW YORK (AP) -- Renewed concerns about soured home loans and the financial solvency of some lenders shot down a continued recovery rally on Wall Street Tuesday, causing stocks to pare sharp gains.

Earlier in the session, stocks had soared following strong earnings from General Motors Corp. and Sun Microsystems Inc. and amid somewhat mixed economic data.

But stocks pulled back after American Home Mortgage Investment Corp. said Tuesday afternoon it hasn't been able to tap into its credit lines and has hired advisers to consider its options, including the sale of its assets. Wall Street has been concerned about tightening credit after some loans made to borrowers with poor credit have gone bad, and that anxiety contributed to the market's big plunge last week.

This further illustrates my point that our economy along with the stock market is nothing more then smoke and mirrors. Yesterday all the fear was out of the market, CNBC had all the regulars on saying happy days are here again because of corporate profits; indeed they are rising, but not due to American investing, but rather foreign investing! Which by the way does nothing to help are national or local economy. Remember, we are part of a global economy; therefore a strong stock market is a mute issue with a weak dollar. How weak? In 2002 the Euro was at .82, today 1.3688- in 5 years the dollar has devalued by approximately 38% !!!
For the first time , in my life time at least, Canadians are vacationing in large numbers here in the US because they are getting more bang for their buck!

This is just a taste of what is to come my friends! Tell me, where are these companies going to turn to? This is definitely going to effect every aspect of our economy and the only ones that will come out on the right side of the stick is savvy investors. Now more than ever is the time for us as investors to learn everything we can on foreclosures and the short sale process.

Stay tuned for helpful strategies and tips.

Monday, July 30, 2007

Here We Go!

Hello All:

Just thought I would let you know what's going on since my last post. It seems the people over at Dave Ramsey's organization didn't like my post! I don't think I was bashing anyone, rather just writing the truth, in fact I did include that Ramsey apologized for the error and reimbursed the papers for payment.

Since the posting I have had several e-mails from the Ramsey organization requesting that I allow then to post to my blog a retort. I sent back a e-mail asking if what I had reported was true, they said yes, but it wasn't Dave, but rather an ex employee who had been guilty of the error.
Believe me I don't want to make a big deal out of this, but I think this is a good example of damage control. I wanted to be fair and balanced, so I sent 2 e-mails asking them to either call me or I would call them to find out their side and if I felt their explanation was valid I would post it for all to see.

Instead I received this e-mail:

James, I don't need/want/have time to carry on a conversation with you
on this issue. I simply asked if you would make your comments open to
all people so I could leave a comment of my own. If you don't want to
do that, that's fine, but please don't try to force a conversation with
me after I told you I would only discuss it publicly on your blog.

Chris Thomas
Director of National Advertising

What's the saying if it looks like a duck, walks like a duck etc.....

I will not be silent on issues I believe to be factual and truthful; besides this organization claims to be a "Christian" one, which I believe needs to hold a higher standard then any other organization.

Be well.

Sunday, July 29, 2007

Who Can You Trust?

This has been a crusade of mine for several years; the abuse of the information and financial advice giving industry. We have all seen so called experts on television or radio peddling their systems and advice, but what qualifies them to be experts? In the real estate industry most are nothing more than information pushers who have not done a real estate deal in 20 years, but are going to tell you how to do it.

Even in the financial advice world, many so called experts have been placed under the microscope, and found that they are not what they seem, case in point Dave Ramsey ( who is a nationally known talk radio host) ...

In 2004 Dave Ramsey's column was dropped from The Tennessean and four other newspapers owned by Gannett, Co. after it was discovered that the identities of those seeking help were falsified in several of his columns. Ramsey accepted responsibility for the error and offered refunds to the newspapers affected by the error.

Believe me, I don't like to throw stones, but these so called experts are the same individuals throwing stones at everyone else, claiming they are the only ones with true in site.

That being said, what should you look for when taking advice about real estate or financial matters?

1. Make sure the individual is active in the industry that he or she is giving advice.
2. Make sure you can personally speak with them; if you can't don't do business with them or take their advice.

Hope this helps in your quest for top quality information and advice.

To your success.

Friday, July 27, 2007

Foreclosure: Preparing to Make calls to Sellers

First you have to go through your newspapers, preferably 2 weeks old. Start with the houses for sale by owner, cross out any by Realtors (at least for now). Next go through the houses for rent. Go up on line to the major FSBO sites and pull down homes in your area. Remember, with some of the changes these sites have made, to save time, just take down the telephone number.

Now you are ready to organize your calling. Go through the above lists, be sure you don't have any duplications.

Check your database to be sure there are no duplications. Now you are ready to call. Get your yellow pad and make up your headings of: telephone number, type of property, price, and notes. Pull out your telephone calling script and start calling. If you get an answering machine, leave your message script for the appropriate type of property. When you get to speak to the seller, ask all of the questions in the script. Remember, you want to build rapport with the seller.
In addition, by using your script you will get all your questions answered before you leave your home office to view the property. If not, you don't leave your home office. Remember, your time, knowledge and energy are valuable commodities, you will not squander them.

Wednesday, July 25, 2007

Short Sales: Special Webinar on Short Sales

Hello All:

Just a quick reminder about tomorrow nights webinar on Short Sales; lines are filling up fast! We are down to 25 lines available - so don't delay in signing up. I promise you that you marketing efforts will increase by 40% with just one of the secrets I will reveal!

I will be sharing real world short sale strategies and techniques such as :

* Getting past the "Gate Keeper".

* Getting the bank to say Yes!

* What needs to be in your short sale package to overcome the BPO.

and much more...

Below you will find the sign up information, register Now! Limited Lines Available...

I hope to meet you on line.

To your success,

James Gage

Thursday, July 26, 2007 - Special Webinar with

Time: 9:00PM EST

Topic: The Art of The Short Sale


* Only 25 lines remaining- Register NOW !

Foreclosures: More Bad News!

Hello All:

As I predicted over a year ago, this housing meltdown will spill over into the main stream America. This is why you should look into becoming a short term real estate investor. Look what the media and mortgage institutions are finally realizing; so with that being said, how long will it take to hit a bottom? My prediction is 24-28 months. I guess I should place an addendum on that statement; as long as we don't have another 911, sustain a flu pandemic or if the dollar is not devalued even further against foreign currencies, then a rebound should happen.

Be well and may all your deals be profitable.

James Gage

Mortgage Fears
by Yahoo! Finance and The Week
Countrywide Financial says that the subprime mortgage has spread to borrowers with good credit.

Thursday, July 19, 2007

Real Estate:The House has passed the Section 8 Voucher Reform

Hello All:

James Gage here to inform you on the Washington real estate news.

JULY 18, 2007 -- Washington, D.C. -- The House has passed the Section
8 Voucher Reform Act of 2007 (SEVRA) that will change aspects of the
apartment unit inspection process to result in faster move-in of new

The National Association of Home Builders (NAHB) said it is "very
pleased" that the bill passed, by an overwhelming bipartisan vote of
383-83. "NAHB has been supportive of efforts to reform the Section 8
voucher program, particularly in areas such as unit inspections," NAHB
stated. The organization said Section 8 reform is one of its highest
priorities for its multifamily members.

The Section 8 Housing Choice Voucher program provides rental subsidies
to approximately two million very-low income households for obtaining
housing in the private market. The program is meant to broaden the
range of housing choices for families seeking affordable housing.

Claudia Kedda, director of multifamily finance at NAHB, said of top
concern to the organization's members is the provision to streamline
the unit inspection process.

The inspection process under existing laws currently requires the
Public Housing Authority (PHA) to inspect a unit when it is vacated
before a new resident using a Section 8 voucher can move in. Problem
is, units can sit empty for weeks while the unit is waiting to be

Under the new bill, the unit still has to be inspected before it is
reoccupied, but if there is an issue and it is not life-threatening, a
new tenant can move in. And the PHA pays the owner the rent
retroactive to the date of the lease. Consequently, both the owner can
cut down on the rent lost and the resident can find a home quicker.

The new bill also allows PHAs to inspect units ever other year rather
than every year, Kedda explained. And if the unit has already been
inspected in the past year under another federal program--for example,
under the Low Income Housing Tax Credit or HOME programs--and meets
quality housing standards, then under the legislation an additional
inspection for the Section 8 program is not required, she said.

Other provisions under SEVRA require HUD to translate official HUD
documents commonly used by property managers that are considered
"vital," and to set up an 800 hotline number for oral interpretations.

And the legislation provides for changes to the project-based voucher
program to, according to NAHB, ensure its flexibility as a tool for
preserving or expanding the supply of affordable apartments especially
those with a tight housing market.

NAHB is currently working with the Senate to introduce a companion
bill. The group said it appreciates the leadership of Chairman Frank,
Chairwoman Waters and Ranking Member Biggert, "who worked so hard to
bring the bill to the House floor."

Seems like it's geared towards inspections!

Tuesday, July 17, 2007

Short Sales: Special Webinar on Short Sales

Hello All:

I'm excited to post my next webinar with the folks at I will be sharing real world short sale strategies and techniques such as :

* Getting past the "Gate Keeper".

* Getting the bank to say Yes!

* What needs to be in your short sale package to overcome the BPO.

and much more...

Below you will find the sign up information, register Now! Limited Lines Available...

I hope to meet you on line.

To your success,

James Gage

Thursday, July 26, 2007 - Special Webinar with

Time: 9:00PM EST

Topic: The Art of The Short Sale


* Only 200 lines available- Register NOW !

Lease Options: Index for New Home Market Sentiment Sinks to Lowest Level in More Than 16 Years

Hello All:

Just another example of what I have been saying for the last 12 months - it's here! Now is the time to start investing in lease options, what are you waiting for? Give me a call anytime.

To your success,

James Gage

New Home Sentiment Index Sinks
Tuesday July 17, 6:36 pm ET

AP Business Writer

Index for New Home Market Sentiment Sinks to Lowest Level in More Than 16 Years, Group Says

WASHINGTON (AP) -- A key measure of industry sentiment on the U.S. market for new homes fell to its lowest point in more than 16 years, a trade group said Tuesday, as builders struggled with rising inventories of unsold houses a

The National Association of Home Builders/Wells Fargo housing market index, which tracks builders' perceptions of current market conditions and expectations for home sales over the next six months, fell to 24 this month, the lowest reading since January 1991, the NAHB said.

cross the country.

Saturday, July 7, 2007

Is Foreclosure & Short Sale Regulation Coming to Your State?

I have been Fielding a lot of phone calls from my office about the rash of state mandatory regulation that have come down the pike recently concerning foreclosures and short sales. I have attached an article of the recent 90 day stay that AG of Massachusetts just recently put in place.

Massachusetts, like many other states have placed stays or regulations in place to protect the home owner from predatory lending. This does not effect the investor or should I say the ethical investor; risky bail out schemes and equity stripping is what these governmental organizations are targeting. Another no no is getting the the deed at the kitchen table, if your worried about the owner disappearing, have the deed held in escrow by an attorney!

As you can plainly see this will not effect us as investors as long as you cross your ts and dot your I (s).



June 1, 2007

(617) 727-2543

BOSTON - Attorney General Martha Coakley has formulated a multi-faceted plan to address the current foreclosure crisis in Massachusetts. The Attorney General’s office has issued emergency regulations under the Consumer Protection Act (Massachusetts General Laws Chapter 93A) to address the problem of so-called foreclosure rescue schemes, which have plagued the Commonwealth amid the current foreclosure crisis. The regulations will go into effect immediately and are valid for 90 days, at which point they may be permanently promulgated after public hearings. The Attorney General’s Office is also considering further amendments to current mortgage broker and mortgage lender regulations which would address widespread unfair and deceptive tactics used by some in the mortgage lending and brokering business, and is soliciting written comments from industry leaders, consumer advocates, and the public. In addition to the emergency regulations and other possible amendments to current regulations, the Attorney General’s Office is in the process of establishing a group of private attorneys who are willing to work pro bono to assist homeowners who are facing foreclosure.


“Our office has brought cases against several lenders, brokers, and lawyers who have carried out foreclosure rescue schemes, involving several versions of foreclosure rescue transactions. All are rife with fraud, and prey on vulnerable homeowners. These “rescuers” take a bad situation—foreclosure—and make it worse by liquidating any remaining equity in the homes to their own advantage and the homeowners’ detriment,” said Attorney General Coakley. “This practice has become widespread, and a new regulation under our Consumer Protection Act is the best way to quickly and proactively combat this problem and to prevent further harm to distressed homeowners.”

Attorney General Coakley announced emergency regulations, effective immediately, to prohibit unfair and deceptive foreclosure rescue schemes. As foreclosure proceedings have become more prevalent in Massachusetts, the Attorney General’s Office has seen an increase in unfair and deceptive foreclosure rescue transactions in the Commonwealth. These schemes are typically initiated when businesses or professionals claim to assist consumers who are facing foreclosure by convincing them to convey their property to straw purchasers. The straw purchasers then obtain mortgage loans, permitting the individuals facing foreclosure to continue living in their property for a limited time, and promising the individuals that they will be able to later reacquire their homes. In the enforcement matters litigated by the Attorney General, the promises of maintaining home ownership are illusory and homeowners lose their home to the so-called “rescuer.”

The Massachusetts Consumer Protection Act authorizes the Attorney General to promulgate regulations to identify unfair or deceptive conduct that violates the act. The emergency regulation prohibits foreclosure rescue transactions that are carried out for profit. It does not prohibit such transactions if they are not carried out for profit, such as transactions between family members or arranged by a non-profit community or housing organization. The regulation defines a “foreclosure rescue” transaction as a transaction (a) that is designed to avoid or delay foreclosure, and (b) where the homeowner transferring the home maintains a legal or equitable interest in the home, such as a lease interest or right to reacquire the property.


In addition to these emergency foreclosure rescue regulations, the Attorney General’s Office is also considering the proposal of further regulations aimed at preventing other problematic practices in the mortgage industry, all of which have contributed to the current foreclosure crisis in Massachusetts. During the course of enforcement investigations and litigation, the Attorney General’s Consumer Protection Division has identified several unfair and deceptive practices used by some mortgage brokers and lenders to process or make mortgage loans to Massachusetts borrowers. The problematic practices occur in purchase money mortgage loan transactions, as well as in those where the borrowers are refinancing an existing loan. The practices often result in consumers having mortgage loans they cannot afford, and thus contribute to the rise in foreclosures in the Commonwealth. These practices include:

• Mortgage brokers and lenders inflating the income of borrowers on application forms and misstating the source of the borrowers’ income;

• Mortgage brokers making mortgage loans which are not in the borrowers’ interests;

• Mortgage brokers and lenders processing and making mortgage loans without considering whether the borrowers can repay them;

• Mortgage lenders making mortgage loans which are not suited to the borrowers by evaluating criteria other than credit and bona fide credit qualification criteria; and

• Businesses being assigned predatory loans without allowing the borrowers the means of asserting claims against the assignees.

In order to address these problems, the Attorney General is considering amendments to existing Mortgage Brokers and Mortgage Lenders Regulations. Before doing so, the Attorney General’s Office is soliciting written comments from all interested parties. In particular, the Attorney General’s Office welcomes comments on the following issues:

• Whether the existing regulations should be expanded in scope to apply to purchase money mortgage loans, as well as loans that refinance an existing loan;

• Whether mortgage brokers and lenders should be prohibited from processing or making mortgage loans unless they reasonably believe that the borrower can repay the loan;

• Whether mortgage loans which are processed on a “no documentation” or limited documentation basis should be prohibited or restricted;

• Whether there should be a fiduciary duty standard, or similar standard, on mortgage brokers who arrange mortgage loans for clients;

• Whether lenders should be required to ensure that the loans they are providing to borrowers are suitable for the borrowers;

• Whether there should be assignee liability for all loans, or for certain types of loans, beyond the current standard applying only to “high cost” loans.

Both the Foreclosure Rescue Scheme emergency regulations and the Request for Comments concerning proposed amendments to the Mortgage Brokers and Mortgage Lenders Regulations, including a comment form, are available on the Attorney General’s web site,

The Attorney General’s Office will accept written comments concerning potential amendments to the Mortgage Brokers and Mortgage Lenders Regulations on or before June 28, 2007. Following the comment period, the Attorney General’s Office anticipates that any filing of proposed amendments to the Mortgage Brokers and Lenders Regulations will be followed by public hearings on those proposals.

The Foreclosure Rescue Scheme regulations are effective immediately as emergency regulations, and may remain in effect for 90 days. The Attorney General’s Office anticipates that those regulations also will be promulgated to take permanent effect. That process, including a public hearing, will likely occur during the summer. If homeowners or professionals have questions about the emergency foreclosure rescue regulations, they may call the Attorney General’s Consumer Protection Division during business hours at (617) 727-2200 extension 2574.

Tuesday, July 3, 2007

Lease Options: More Good News for Lease Option Investors!

Pending Home Sales Near a 6-Year Low

AP -

Pending sales of existing homes dropped to their lowest level in almost six years, a real estate trade group said Tuesday, demonstrating the persistence of the housing slump.

What are you waiting for? Start investing today!

Wednesday, June 27, 2007

Lease Option: How do lease options work and what are the benefits?

How do lease options work and what are the benefits?

Answer: A lease option is an arrangement with you and a seller to exercise the option to buy a piece of real estate property after you have rented it for a specific period. A portion of your rent would be applied toward the purchase if the option is exercised. This is referred to as rent credit, which most institutional lenders will accept as part of the down payment if rental payments exceed the market rent and if a valid lease-purchase agreement is in effect, a copy of which must be attached to the loan application.

If you are a seller, lease options can give you several advantages, especially in a slow market. These include a monthly rent higher than market rent, top-market value for the property and tax-free use of the option consideration until the option expires or is exercised. Also, the renter is more likely to treat the property like an owner, tax-free use of option consideration until the option expires or is exercised.

Read any lease-option arrangement carefully for details on transferring the option and other important concerns. If you have any questions feel free to contact me via e-mail or give me a call @ 508-595-9567.

Tuesday, June 26, 2007

Real Estate Investing: More Evidence...

New Home Sales Fall in May for 4th Month

AP -

Sales of new homes fell in May for the fourth time in the past five months, providing further evidence of a continued slump in housing.

Just FYI.....

Get started investing today!

Monday, June 25, 2007

Lease Option: Another Reason to Start Using Lease Options

Home Sales Hit Slowest Pace in Four Years

Reflecting further housing troubles, sales of existing homes in the United States fell in May to the lowest level in four years while the median home price dropped for a record 10th consecutive month.

Do you see a trend forming here?

Friday, June 22, 2007

Lease Options: Will Real Estate Agents Do Lease Options?

Lease Option Tip of The Week

The simple answer- absolutely! Contrary to popular belief, real estate agents will do lease options as long as they get paid!
In most states a listing or co-broke piece of property can not generate a commission for real estate professional unless a closing happens; as always there is an exception to every rule. In this case the listing agent would have to go to their broker and get permission to do some kind of fee agreement in place of their commission structure.

As you can plainly see it would be much easier to have this understanding prior to finding a potential deal.

Hope this helps; my all your deals be profitable.

James Gage

Tuesday, June 19, 2007

Lease Options: Are Lease Options Illegal?

Hello All:

I received a very interesting phone call today from a real estate investor who was exploring lease option investing. He had talked to a few local investors who told him that lease options are illegal and risky! He called me because he found me on the net ( and wanted to find out the straight scoop.

I began to explain that lease options are illegal if they are done wrong, which by the way 95% are implemented wrong. You see I continued, most people believe they can read a book or listen to a tape and then it's off to the races. Truth be told, very few people in our society (me included) can take a book and implemented without any help or direction. - that's why I developed my One-on-One Mentoring Program.

As our conversation concluded he asked me what the first thing he should due before getting involved in any real estate strategy? I told him to check with his states guidelines for investors, the Dos and Don'ts can be obtained at that states Attorney Generals Office (which can be fund online). The second part of the answer I don't think he was ready for! You need to get a mentor, whether it's me or someone else - don't go it alone!

Hopefully, this brief post will guide those of you who are trying to go it alone to re-examine your game plan/business model.

To your success,
James Gage

Mark Twain said: "Keep away from people who try to belittle your ambitions.
Small people always do that, but the really great make you feel that you too can become great."

Thursday, June 14, 2007

Lease Options: Rates on 30-Year Mortgages Jump to the Highest Level in 11 Months

Hello All:

I hate to tell you I told you so, but I told you so! Interest rates are are the move and those of us that invest with lease options are positioned to profit heavily! Why?

1. People will be priced out of the home buying market, thus seller's will be extremley opened minded- more than usual.

2. People who can't buy will have 2 choices: 1. traditional rent situation or 2. Lease Options.

Now is the time to get involved in lease options! Enjoy the article.

James Gage

Rates on 30-Year Mortgages Jump
Thursday June 14, 11:42 am ET
By Martin Crutsinger, AP Economics Writer

Rates on 30-Year Mortgages Jump to the Highest Level in 11 Months

WASHINGTON (AP) -- Rates on 30-year mortgages rose for a fifth straight week, hitting the highest level in 11 months as prospects dimmed further for possible rate cuts from the Federal Reserve.

Mortgage giant Freddie Mac reported Thursday that 30-year, fixed-rate mortgages averaged 6.74 percent this week. That was up from 6.53 percent last week and marked the biggest one-week rise in 30-year rates in more than three years.

The five consecutive increases have pushed 30-year mortgages to their highest level since they were at 6.80 percent for the week ending July 20, 2006.

"Mortgage rates moved sharply upward this week," said Frank Nothaft, Freddie Mac's chief economist. "These moves parallel rising yields on Treasury securities as concerns about inflation pressures and continuing strength of consumer and business spending have dimmed hopes for an interest rate cut."

The benchmark 10-year Treasury bond hit a five-year high of 5.295 percent on Tuesday, sending tremors through Wall Street as investors worried that rising interest rates could further depress the housing sector and also harm corporate profits.

All mortgage rates tracked by Freddie Mac showed increases this week.

Rates on 15-year, fixed-rate mortgages, a popular choice for refinancing, rose to 6.43 percent, up from 6.22 percent last week.

Five-year, adjustable-rate mortgages averaged 6.37 percent, up from 6.24 percent.

One-year, adjustable mortgages rose to 5.75 percent, up from 5.65 percent last week.

The mortgage rates do not include add-on fees known as points. Thirty-year and 15-year mortgages each carried a nationwide average fee of 0.4 point. Five-year, adjustable mortgages carried a fee of 0.5 point while one-year ARMs had a fee of 0.7 point.

A year ago, rates on 30-year mortgages stood at 6.63 percent, 15-year mortgages were at 6.25 percent, five-year adjustable-rate mortgages averaged 6.23 percent and one-year ARMs were at 5.66 percent.

Short Sales: Fact of The Day

More than 30 subprime lenders, including New Century, have gone bankrupt this year!

Wednesday, June 13, 2007

Foreclosures: Foreclosures Jump 90 Percent Since Last Year

Hello All:

I'm getting to be a broken record, but in the pursuit to provide you my loyal readership, I believe I have a responsibility to provide any and all information from multiple resources to prove that my take and advice on real estate investing is correct. As you can see by this article, it's time to do some short sales.....

Be well,

James Gage

By Julie Haviv


NEW YORK (June 13) - U.S. home foreclosures in May jumped 90 percent from a year earlier, reflecting a poor spring housing market and foreshadowing even higher levels later in 2007, real estate data firm RealtyTrac said on Tuesday.

RealtyTrac said there was a national foreclosure rate of one foreclosure filing for every 656 U.S. households during May.

The May foreclosures -- a sum of default notices, auction sale notices and bank repossessions -- totaled 176,137, up 19 percent from April, the firm said in its May 2007 U.S. Foreclosure Market Report.

The number of filings in May was the largest amount since RealtyTrac started tracking foreclosure activity in January 2005.

"After a barely perceptible dip in April, foreclosure activity roared back with a vengeance in May," James Saccacio, chief executive officer of RealtyTrac, said in a statement.

"Such strong activity in the midst of the typical spring buying season could foreshadow even higher foreclosure levels later in the year," said Saccacio. "Certainly not every community nationwide is seeing an increase in foreclosures, but foreclosed properties are becoming more commonplace and adding to the downward pressure on home prices in many areas."

RealtyTrac said there was a national foreclosure rate of one foreclosure filing for every 656 U.S. households during May.

The default rates in the subprime segment of the U.S. mortgage market, which caters to borrowers with poor credit histories, have jumped in recent months as the housing industry has slowed and prices have fallen.

More than two dozen lenders in the subprime mortgage sector have collapsed as rising defaults drove them out of business during a downturn in the housing market.

Market observers are keeping a watchful eye on the subprime crisis because it has triggered broader concerns that the fallout may spread to mainstream lenders and damage the economy.

Nevada, once one of the hottest real estate markets and a favorite among investors, led the nation in May with one foreclosure filing for every 166 households, which was the nation's highest for the fifth month in a row and nearly four times the national average.

Nevada's foreclosure activity, at 5,235 foreclosure filings during the month, rose 40 percent from April and was nearly five times the number reported in May of 2006.

Colorado came in second with one foreclosure filing for every 290 households, which was 2.3 times the national average. Colorado's foreclosure activity, at 6,231 foreclosure filings in May, rose 9 percent from the previous month and was an increase of more than 50 percent from May 2006

The state's foreclosure total was the eighth highest among the states.

California, the largest state, reported foreclosure activity increasing by 30 percent from the previous month and more than 350 percent from May 2006, which boosted the state's foreclosure rate to the third highest in the country.

California documented one foreclosure filing for every 308 households, which as more than twice the the national average.

Florida, Ohio, Arizona, Georgia, Michigan, Indiana and Connecticut were some of the other states with foreclosures rates ranking among the nation's 10 highest in May.

The cities with the nation's top three metropolitan foreclosure rates were all located in California, and three other California cities also documented foreclosure rates among the top 10.

A 49 percent increase in foreclosure activity ensured that Stockton, Cali., would register the nation's highest metropolitan foreclosure rate at one filing for every 88 households, which was nearly 7.5 times the national a average.

Merced, Cali., documented the second highest metro foreclosure rate, one foreclosure filing for every 100 households, followed by Modesto, Cali., with one foreclosure filing for every 118 households. Other California metros in the top 10 were Riverside-San Bernardino at No. 5, Vallejo-Fairfield at No. 6, and Sacramento at No. 7.

Las Vegas at No. 4, Denver at No. 7, Detroit and No. 8, and Miami at No. 10 were other top 10 cities.

Tuesday, June 12, 2007

Short Sales: Wannabe Buyers Welcome Housing Market Slump, but Lenders Tighten Mortgage Standards

Hello All. Here is just another example of what tough times lie ahead for the housing market; can you see the great opportunity for investors' who implement short sale and lease option strategies? Please read the below article and let me know what you think!

Be well.
James Gage

Wannabe Buyers Welcome Housing Slump
Sunday June 10, 2:16 pm ET
By Alex Veiga, AP Business Writer

Wannabe Buyers Welcome Housing Market Slump, but Lenders Tighten Mortgage Standards

LOS ANGELES (AP) -- Kurt Montufar isn't stressing over the housing slump. He's actually hoping things get worse. Like many wannabe homebuyers who were priced out of the market during the last boom, Montufar spends time these days scanning real estate ads and news reports to determine if it's time to take the plunge and buy.

Foreclosures rising? Great. Cash-strapped sellers pressured into lowering prices because they can't find buyers? Even better.

"Somebody else's misfortune could be my happy ending," said Montufar, 27, a resident of suburban Los Angeles.

Indeed, the advantage is shifting to buyers in many previously high-flying housing markets, as homes take longer to sell and prices level off or begin to fall.

Modest annual declines have been seen in cities such as San Diego, Boston, Las Vegas, Phoenix and Honolulu, according to first-quarter data on existing single-family homes compiled by the National Association of Realtors.

Meanwhile, price gains of just 1.4 percent or less were reported in New York, Chicago and Washington, D.C.

Those numbers have left many people trying to "time" the market to take advantage of the slump. But experts said that can be risky because there is little consensus on how long the current doldrums might last.

In addition, the market forces that helped drive the housing boom -- affordable financing and the alluring prospect of escalating home values -- are no longer a given. Potential price breaks could be wiped out if interest rates rise any higher.

"In general, it is very difficult to time the market," said Raphael Bostic, associate director of the University of Southern California's Lusk Center for Real Estate.

"The real problem with that is you don't know when the floor is until after it's passed. If the floor is right now, you missed it," he said.

Montufar, an asset manager and part-time real estate agent, has little choice about waiting for prices to fall further.

He would like to pay about $500,000 for a home in the San Fernando Valley. However, the properties he has been eying are still priced at about $650,000.

"At this point, I've got no choice but to wait and see ... how low they get so that it gets to a point where I can afford it," he said.

Others have already seized opportunities to buy.

Melanie Scalice, 36, a seventh-grade teacher living in the Boston suburb of Arlington, Mass., saved for years for a home. She decided to jump into the market when local housing prices began to dip after years of double-digit percentage increases.

"The timing has been great," Scalice said. "With prices going down, there's so much for sale that I had a lot to choose from."

Still, she had to go to Fitchburg, some 40 miles from Arlington, to find a home that suited her budget and need for space. She settled on a $199,000 condominium.

Areas outside big markets may still represent the best option for finding an affordable home.

"There are areas where prices will, at worst, stay flat, but probably continue to go up," said Patrick Lashinsky, CEO and president of Emeryville, Calif.-based ZipRealty Inc.

Home prices haven't lost much steam in the Northwest. Seattle's metro area, for example, saw its median price soar 12.3 percent during the first quarter.

In California, where home values more than tripled since 1995, sales have been lagging and price appreciation has slowed or fallen in major metro areas.

Prices have declined sharply in regions that saw major home or condo construction in recent years, such as Riverside, San Bernardino and San Diego counties.

Even if prices fall further, it could be tough for buyers to find affordable financing if interest rates increase much more.

The Federal Reserve raised the federal funds rate from 1 percent to 5.25 percent between June 2004 and June 2006. The rate, which can affect mortgages, has held steady since then.

Meanwhile, the monthly average interest rate for a 30-year fixed mortgage crept from a low of 5.23 percent in June 2003 to 6.26 percent last month, according to mortgage giant Freddie Mac.

In addition, lenders have tightened standards in response to a surge in defaults by subprime borrowers, and a number of subprime lenders have gone out of business altogether.

A number of wannabe buyers are pinning their hopes on foreclosures, which some studies predict will explode during the next two years as adjustable mortgages reset to higher interest rates.

Foreclosure activity jumped 62 percent nationwide in April from the year-ago period, according to Irvine-based RealtyTrac Inc. Among the states with the highest foreclosure rates were Nevada, Colorado, Connecticut, Florida and California.

Gino Barragan of La Puente, Calif., a lifelong renter, was among the hundreds of people who attended a recent auction looking for a good deal on a foreclosed home.

Barragan, 34, was hoping to find a condo costing less than $300,000. He found only one that he liked within his price range.

"I am willing to wait, but I'm keeping my eyes open," said Barragan, a teacher.

Bruce Norris, president of The Norris Group, a real estate investment company, said now might be the best time to purchase a home, if the buyer plans to live there for 10 years.

"I'm not sure that I wouldn't rather pay today's price with today's interest rate than count on a big discount and the wild card that interest rates might be very different," Norris said.

"It would not shock me to have a 10 percent interest rate by the end of this negative cycle," he said.

Sunday, June 10, 2007

Urgent : FLASH: PIMCO's bond guru Bill Gross predicts US housing market to be "decimated"

Hello all, James Gage here; when I read this I had to immediately post for your review and consideration. If this is true, it opens up a tremendous opportunity for us as investors; there will be 2 options (forgive the pun) for most people: 1. Become a renter or 2. Lease Option a property. That being said please read the rest of the comments by Bill Gross, and if you have any questions please do not hesitate to contact me.

“These increases in rates over the past few days have placed the 30-year mortgage market at close to 7% in conventional terms,” said Gross, chief investment officer for Pacific Investment Management Co. and manager of the world's largest bond fund.

“This will decimate the housing market if it wasn’t already decimated before, and certainly put the Fed on hold, and maybe allow the Fed to reduce rates…six to nine months from now.”

Friday, June 8, 2007

Lease Option : How To Protect Yourself In A Lease Purchase Deal

by James Gage

First The Good News:

You’re holding a cashier's check made out to you for $5000.00. You also hold in your entrepreneurial hands a contract that will generate $250.00 per month Positive Cash Flow. The deal even gets better it's someone else's property and you have minimal liability with no Tenant & Toilet problems. You call home and tell your significant other to get ready you're going to do the town and he/she is really proud of you! Yes, life is good! You have just created, negotiated and achieved your first Lease Purchase deal of your real estate investor career and now you can envision many more deals of the same kind.

How did you do it ?

You got with the program, worked hard and went out and found a nice 3 bedroom / 2 Bath Home, you know the one with the white fence around it. You have Negotiated the deal so you make money at the beginning of the deal, the middle and at the end. You now control it for the next two years with just one month rent out of your pocket. A Tenant Buyer will be renting to own from you in a Sandwich Lease and placing $5000.00 as non refundable Option considerationin to your pocket. A Sandwich Lease is simply when you rent and control another's property for a specific period of time with all the terms of the purchase pre-negotiated. If you have quality contracts with a specialized assignment clause you may rent this property to another. You should always profit immediately or upfront with what we call option money (a non refundable amount of money paid at the initiation of the deal), have positive monthly cash flow and a possible note or cash when the option is exercised (purchased) !,/p>

Congratulations, you now control the property without the title changing hands and you can sublet, assign, transfer or convey any rights which you have to a third party. Not bad, huh ? Only here comes Murphy's Law...................

The Bad News.

There are many ways your Lease Purchase deal can go wrong UNLESS you take some of the following steps to protect yourself and the deal.

1. Option Money: Always get enough non refundable Option consideration upfront. Nothing beats making money upfront, but better yet getting a substantial financial commitment from your tenant/buyer reduces the likelihood of a problem. Don’t do a Lease Purchase with a Tenant/ Buyer unless they can commit a minimum of Option Money (3 to 5 months rent or more). Remember we want to finance like a tenant and invest like a investor.

2. Contracts: Don’t use generic real estate office or stationary store Lease Purchase contracts. Have a good contract drafted by a competent real estate investor or attorney. It should contain the verbiage that will protect you. I use 7 different and specific Lease Purchase Contracts in my transactions depending on my strategy or position in the deal.

3. Memorandum: Record a Memorandum of Option. This document can be recorded simply and inexpensively and can offer tremendous protection for your rights in the property. You can file these documents at your local Registry of Deeds where the mortgage has been recorded.

Example: The seller tries to sell the same property to another person without you being notified. The memorandum clouds the title and the owner is not able to sell the property without dealing with you first.

4. Credit Check on Tenant/Buyer & Owner: Check the credit of the buyer and the seller. Know as much as possible about the people you're doing business with - knowledge is power.

5. Preliminary Title Check: Do your homework and check out the owner and the property with one of the commercial property on-line services available or better yet contact your local Title company or a professional researcher for information. Do your due diligence.

6. Open Escrow: Open escrow and have escrow instructions issued at the onset of the transaction. It will create a paper trail and show the intent of the parties in the event of a legal challenge.

Special Tip: Try to always use your Escrow/Title Company or Attorney in these matters. It just makes sense to work with people with whom you have established a business relationship. They might just look out for you.

7. Deed: Have the owner place the deed into escrow as soon as possible. In the event you or your Tenant/Buyer wish to close, there will be one less delay.

8. Payment Account: Set up a direct payment account with an escrow company, title company or a bonded/established accountant or firm to pay the bank, taxes, etc.

9. Insurance:

A. Have the Seller make you the loss payee on the insurance policy (if you can).

B. Require the Tenant/Buyer to have renter’s insurance.

10. Property Inspection: Do a property inspection/walk-thru with the Tenant/Buyer and use a complete inspection form that the Tenant/Buyer can sign.,/p>

Note: Take a camcorder video of the property with the Tenant/Buyer and have them sign and date the tape.

11. Honesty: Be upfront and honest in your dealings with all the parties. Hopefully, in turn, they will reciprocate and you will all enjoy a Win/Win deal. Let the seller know that you will be subletting the property to qualified Tenant/ Buyers.

Final Thought: The best way to protect yourself in any Lease Purchase is to deal with all the possible problems before they occur, this is part of the Negotiating process whether with the Seller or the Tenant Buyer. Most real estate investors fail not because of lack of knowledge concerning a strategy, but rather they do not know how to Negotiate. Negotiating is a "Million Dollar Skill" and most people do not know how to do it on a consistent basis, but if you ask most people they have convinced themselves that they are a top notch Negotiator is every avenue of their life. My challenge to you is to take account of your life, success leaves clues if your business/investing is not successful or your just trending water- you do not how to Negotiate adequately. Don't loose your upside potential to anyone or anything.

Hindsight is 50/50, but Foresight is 100%!

James A. Gage. is a best-selling author and internationally-known expert in Lease Purchase, AKA Rent To Own Real Estate Investing and Negotiating. He Mentors One-On-One throughout the U.S. and across the world. James is also director of the Gage Consulting Group, LCC , 800 Main Street, Suite 104 Holden, MA 01520 .