Answer To Joe

Joe wrote:

joe here. Awright! Three free questions. i couldn't find a "post" button so i assume they go here? Ooops, does that count as one of my free questions? Ooops there's two? ;-(

i'm a "newbie". Since rates are still pretty good i'm searching for a few refi's while i try to put together a purchase business. For now i do property searches on people who bought between 1998 and 2002, when rates were high-ish, on the hopes that one or two might have missed out on earlier rifi opportunities. Is there an easier way to do this? And, what i'd *really* like to do is search out people who are living under b/c paper loans but i haven't a clue how to go about this?

And, regarding refi's, since these would be mostly rate/tem refi's i'd like to do a quick 'n' dirty "break-even", etc. for them so i wrote a little spreadsheet routine. My mentor (and every one else in the office) disagrees with my methodology.

What i try for is an "apples to apples" comparison so i
* take a look at their original terms (say 30F and $100,000).

* take a look at how long they've held the mortgage (say 5 years) and calculate their current balance (about $95,000).

* then i run a new payment based on that balance plus finance charges ($95,000 plus say $3,500) as amortized over *25!* years. This is where everyone disagrees with me. They say it should be for 30 years since that was the original term. i say it should be 25 since that what's left and i want "apples to apples". They say it makes us look crappy (compared to the other guys). i say being able to surface the truth (if it is the truth?) is our competitive advantage.

Help?

* Anyway, i then divide the costs of refi by the difference between the two payment rates to come up w/ a roughly right number of months to BE (recover fincance costs) and, no, i don't bother to figure in tax benefits/consequences (after all i am a newbie!)

Joe,

I think you only asked two questions. :)

1. In certain states like Florida there are services (in FL the name is ISC) that provide date from public records. You can search for date of loan, rate, lender name, etc. If you have a service like this great. Or if there is a b/c lender that is big in your area you can search their records.

Or run an ad in the paper "If you are paying more than 9% for your mortgage I can save you X thousand dollars a year regardless of your credit"

Homeownership is public records. So you can also get a name of everyone that owns a home. But what you need is a person who owns a home and that has bad credit. That is what you say to the listbroker you will approach.

Who is the person you are targeting:
homeowner
bankruptcy
multiple collections
maybe a foreclosure
secured credit cards
judgements
tax liens
low credit score
zip codes
professions
maybe he has bought a how to fix your credit product by mail.

Look for a list broker in your yellow pages or online, and see how many of the above they can help with. And add anything else you think might affiliate with your target.

as for your apples to apples idea. It's good if you don't want business.
Apples to oranges is better. The general public doesn't understand the math anyway, so why are you making it harder for yourself to get a loan?

I say try it. See how people respond. If you don't get any business, try it the other way and compare. And just because your mentor or anyone else says so doesn't mean it is right. Test everything. Cause you never know.