Wednesday, September 21, 2011

Great Time To Avoid Buying A House

Well this post should prove to make a lot of Real Estate professionals very upset with us. You are being sold everywhere that now is the best time ever to buy a house. Interest rates have never been lower. I would rather pay higher interest rates on a property that I know will appreciate than to pay a lower interest rate on a property that will continue to depreciate especially in light of the next market bubble burst that only so called experts will tell you they saw coming after the fact. Yes there will be another bubble burst. It's already under way but gets little to no press coverage at all. After all, everyone still wants your cash.

On average, homes have fallen fifty percent of their value of a 2006 high price point. That's the national average. Prices have yet to fully fall here in this area. Don't fool yourself into thinking they won't despite stories in the press otherwise. Rental prices are at all time highs and continuing to go up as more people continue to get kicked out of their homes. There will be market adjustments in a few years here as well. Most people these days are upside down in their mortgages on their houses. Jobs are still being lost and not replaced at an alarming rate with no fix in site.

Many people are walking away from their houses and letting the banks take the eat the negative balance. Problem here is that the banks are making a profit on these homes and on foreclosures. So it's no nothing to them that you walk away. It's just your credit that takes the bath. The banks can sell these newly acquired homes in the red and still make a profit from them as you the tax payer are already paying these bailout costs. Your crying because of presently proposed tax increases? Who do you think is footing all these bills? They are coming one way or another like it or not.

Smart investors are picking up these houses for pennies on the dollar that is well below a fifty percent reduction in present prices. How long do you think this can go on before it hits the value of your home? It is without question a buyers market and a buyer can easily walk away from any deal or make offers that dramatically call into question the present value of your home and it is. You just do not know it yet. County assessments are artificially inflated to maintain the present tax base otherwise you would be screaming at the new hikes in taxes you are paying now anyway based on the real value of your home.

Want to have some real fun? Challenge your assessment with the county on your present home value. If enough people do this, values will be re done to reflect the actual value of your home and tax hikes will kick in to maintain present levels. Opps, no one else is explaining any of this to you now are they? So again, you must look at all the market forces that make up a homes value, an important one is people with enough income to pay what you are asking. Something that no longer exists as it once did. Jobs that allow enough people to make enough money to buy a home have gone into major decline with no new ones to replace them. So how long do you think it will be before a market correction on present over inflated prices hits and your home value crashes? Well Alice, you can live in dreamland for as long as you want, but you can't escape what is going on around you.

The only way we can see buying a home in the present economy is if one pays cash for it and buys it with the intent on living there and it is a dream house. Otherwise you are going to end up upside down in the home with no hope in sight. This of course is not the news that the real estate brokers want you to read, and they will do everything they can to disprove this storyline or show you the flaws. Use your own common sense and look at the economy around you asking the tough questions, then ignore what the broker has to say unless the broker is retired and has no financial interests in selling you anything.

Free $200.00 Dinner

If you think it's really free then we need to talk

Today's investment climate is sure to make you poor
Chuck Thompson of TTC Media

You are invited to a free dinner at Crystal's Diamond Palace. The catch, you must own your home or must at least be actively and presently looking to buy your first home. Plus you must have an asset portfolio of one hundred thousand dollars and have an additional thirty thousand in cash conversion equivalents. (How else do you expect to pay our fees?) Welcome to the money store jingles raging across the nation. Self proclaimed financial experts implying they know money better than you do. Well at least they know how to get their hands on other people's money better than you do anyway.

If you are a sucker enough to buy into the storyline, you can expect a great night of constant low pressure sales techniques designed to show you how dumb you are and how smart they are. You will be sold on concepts that show you how to part with your money under the guise of making and keeping more of your money and building a sounder nest egg for when you retire. Good luck on that. One recent person we heard was advocating taking your 15 year mortgage and turning it into a thirty year one to free up monthly cash flow. Wait there is more. If you roll your high interest credit card debt and even your car payments that is not tax deductible into the new 30 year mortgage and it now becomes partially tax deductible, you will save a fortune.

Sounds smart huh? Wait there is more, but you have to come to the free dinner to get the entire scoop. Have you figured out the con yet or are you hungry for more? If you are hungry for more, go git yer free dinner. We have freed up over $500.00 monthly cash for one of our clients using this technique alone. (Costing that poor sap a huge fortune). Let's break this down just where we are now and see how you will loose a ton of money on what sounds like a very smart idea. First off, re structuring your mortgage is going to cost money. I don't have to have any financial interests in any mortgage company to make a big fat fee from steering you towards them.

Second, extending any credit, even at longer and lower terms costs more than paying them off sooner. You think buying a house is a wise investment? You bought that house thirty years ago for fifty thousand dollars and now it's worth two hundred and fifty thousand dollars? Smart investment huh? Until you add up all the monthly payments you paid during the lifetime of that mortgage and found out that you paid three hundred and twenty thousand dollars for that two hundred and fifty thousand dollar house. What? You didn't think the bank understood appreciation of assets when they wrote that loan thirty years ago? So you are still upside down in your smart investment. You would have been better off buying that corvette.

A fifteen year loan does not carry as much of an interest bearing burden as a thirty year fixed lower interest loan does. The sooner you get rid of any loan, the better off you are going to be. What is more profitable, a four year twenty five percent loan or a thirty year four percent loan? Answer, a thirty year 4 percent loan is more profitable to the bank and more expensive to you. Higher interests rates are charged for depreciating assets. Lower interest rates are charged for appreciating assets. So rolling over a depreciating asset and refinancing it into an appreciating asset insures the bank against loss while you pay more.

But hey, after paying those refinance fees that just put you deeper into debt, you have more cash to play around with. So now these financial experts are going to show you how to make money with your new found money. (Ah, more finders fees paid to them). You are shown the way to financial freedom and are instructed to cut up all but maybe one of your credit cards. Smart no matter what your situation is. I recommend cutting them all up and not even saving the one. So now you are directed into the investment market. Account setup fees and transaction fees abound. But you are building your nest egg now in sound financial instruments. How smart you have become and how good it's been for you to listen to these folks.

And the choices. Not one when truly researched sound no matter how good they look on paper. Let's look at market portfolios that invest in everything from pork bellies to stocks to bonds. All spread out over an entire array of fields. Cuts the risk. Well, it cuts the risk of the managers, not yours. These portfolios may make a huge amount of money, but by the time everything is cut up and their fees taken out and costs divided up, you are lucky if you stayed just below inflation. Turns out what is on paper is not what actually comes down to you. But now you have more fees to pay that are not covered by your meager profits that eat further at what you are trying to build. Those fees are your account fees and have nothing to do with your investments except where your investments are held. But hey, next years market will be better. And remember, your investment friends can not be held responsible for market corrections that are going to wipe you out next year before you pay more administrative fees to your broker along with account fees.

Your new mortgage in the mean time has been sold several times to other companies that have created derivatives out of it. Your last payment as it turns out went to the wrong company and now you are a month behind on your mortgage and your credit takes a hit. More fees and higher rates because of this. But hey, your investments will pick up the difference. Now that you are in the hole deeper than ever before, at least you had more spending money and still have some of it left over even though you have gotten even deeper into credit debt and are now potentially facing being laid off as your company moves operations overseas. But hey, your a smart perso0n and these strategies came along at a great time, so maybe there is hope for some new strategies. Well I have just the perfect opportunity for you. Turns out there is this bridge in Brooklyn for sale.

So let me just finish by saying that I am more than happy to spend two hundred dollars up front to show you that I am smarter than you with the use of charts and knowing that by the end of the night I have you hooked into bringing me about two thousand dollars in fees all the while selling out your future. Yup, your a pretty smart person for buying into this. By the way, that two hundred dollar dinner only costs me thirty five dollars and I have just structured a deal to pull an additional eight hundred dollars out of one in five that I get on board. Cheers.

Monday, September 19, 2011

Scott Petty With The US Coast Guard Update

We have just learned that Scott Petty with the US Coast Guard, a division of Homeland Security, works in the legal department in Norfolk, Virginia. This is the guy we have been reporting about with all the illegal fireworks and the way he uses them as well as our last report where he tried to pick a fist fight with a female neighbor. Here is a guy that should obviously know better based on the fact he works in the legal department. Apparently this guy thinks he is above the law? This is frightening.