Think Outside the Box

After enduring a year of fluctuating interest rates and mortgage industry trends, current and potential homeowners are opting to think outside the box, the 'big box' that is. They are relying on their local lending agent, instead of online big box lenders, to provide the best mortgage products and interest rates to fit their needs.

Over the next year, industry experts predict that each home purchase and mortgage arrangement will be as unique as the people purchasing the home. Home buyers are seeking out their local mortgage brokers in order to ensure they obtain a variety of lending options that will fit their lifestyle and budget. These unique buying and lending options not only allow home buyers to take advantage of the rates and products that match their current and future financial situations, but it also provides a level of flexibility that might not be available through an online-only lender.

Below are a few advantages to consider when purchasing loans from your local lending agent:

Competitive Rates
A couple of years ago interest rates were at an all time low, meaning home buyers could receive the best loan rates from just about anyone in the mortgage business. Now that local and big box lending agents share the same pool of wholesale lenders, both are able to offer the same mortgage products and rates. But, unlike big box brokers, local brokers have the ability to offer an additional set of geographic specific lending options which may better fit a borrower's niche market.

Easy Access
In order to ensure a speedy lending process, it is important to work with a broker who is accessible. By using a local mortgage broker instead of an online big box lending agent you can ensure you have personal first-hand access to the people underwriting your loan. Having the ability to phone or meet your broker and underwriter will help keep your loan on track towards quick approval.

Customer Service
Home buyers often find it comforting to know that their broker can meet with them in person as they guide them through one of the largest and most important purchases of their lives. This level of personalization allows the local broker to accurately evaluate the borrower's financial situation and provide superior loan options and customer service. A local mortgage broker's knowledge of the surrounding real estate and their dedication to offering flexible, innovative loan and payment options ensure you receive a loan that fits your specific needs.

Understand the Market –Shop With Confidence

Rates go up rates go down. In case you haven't been paying attention, the market has been very volatile lately. Every day it seems as if it's an absolute crapshoot as to where rates will be for that day. The good news is that rates are still low by historical standards.

Over time, small changes can add up to thousands of dollars so it's important to have at least a basic understanding of what drives interest rates and how the market works. My goal for my clients is that they know the answers to some basic questions so that they can understand how the market works and they can be armed with the right questions when they go shop for a loan. Unlike a lot of my competition I actually encourage shopping.

Here are some of the questions we give our clients:

1) What are mortgage interest rates based on?
The only correct answer is Mortgage Backed Securities or Mortgage Bonds, NOT the 10-year Treasury Note. While the 10-year Treasury Note sometimes trends in the same direction as Mortgage Bonds, it is not unusual to see them move in completely opposite directions. DO NOT work with a lender who has their eyes on the wrong indicators.

2) What is the next Economic Report or event that could cause interest rate movement?
A professional lender will have this at their fingertips. For an up-to-date calendar of weekly economic reports and events that may cause rates to fluctuate, visit www.suewoodard.com and hit the green MMG Weekly banner - this is a copy of our weekly newsletter, let us know if you want to be added to my weekly distribution list.

3) When Bernanke and the Fed "change rates", what does this mean. and what impact does this have on mortgage interest rates?
The answer may surprise you. When the Fed makes a move, they can change a rate called the "Fed Funds Rate" or "Discount Rate". These are both very short- term rates that impact credit cards, Home Equity credit lines, auto loans and the like. On the day of the Fed move, Mortgage rates most often will actually move in the opposite direction as the Fed change. This is due to the dynamics within the financial markets in response to inflation. For more information and explanation, just give us a call.

4) Do you have access to live, real time, mortgage bond quotes?
If a lender cannot explain how Mortgage Bonds and interest rates are moving in real time and warn you in advance of a costly intra-day price change, you are talking with someone who is still reading yesterday's newspaper, and probably not a professional with whom to entrust your home mortgage financing. Would you work with a stockbroker who is only able to grab yesterday's paper to tell you how a stock traded yesterday, but had no idea what the movement looks like at the present time and what market conditions could cause changes in the near future? No way!

Be smart... Ask questions. Get answers!
More than likely, this is one of the largest and most important financial transactions you will ever make. You might do this only four or five times in your entire life. but we do this every single day. It's your home and your future. It's our profession and our passion. We're ready to work for your best interest. www.jeffnunley.com    

America's Balance Sheet Moving Again as House Equity Falls – Todd Ballenger

The net worth of U.S. households hit a record high $58.6 trillion in the third quarter of 2007 according to the Fed's Flow of Funds report. This is surprising, when you consider that net equity in homes declined in the third quarter for the first time in 16 years. Growth is at further risk in the current quarter. We often speak about managing assets and liabilities and how they tend to move in different uncorrelated cycles.  As house prices drop, growth in stock and mutual fund holdings drove the gain in wealth this past quarter for most Americans.

Net Wealth

Borrowing grew 7.9% from last year - the slowest growth in borrowing since the start of 2001.

Asset grew 7.4% last year. While borrowing is growing faster than assets, the level of assets is larger than borrowing, so there was still a balance sheet increase in wealth.

Household assets continued to grow at a rate of about $5 trillion per year.  Growth in the total value of stock and mutual fund holdings by consumers increased by more than the net equity in real estate for the fourth consecutive quarter and by the largest amount since the first quarter of 2004.

Shifting Demand For Money

Consumers are shifting the nature of their borrowing. As standards have tightend for mortgages, overall borrowing by consumers using credit grew by over a percentage point over the last year to 5.3%. If consumer continue this trend of moving to harder money, they'll increase their debt and lose tax benefits associated with most mortgage borrowing, further creating their own version of the current credit crunch.

Real Wealth May Drop

Housing wealth is likely to decline further. Many believe that the OFHEO 1.8% growth for the year through the third quarter is off, as they use lower priced homes and exclude jumbo properties, which according to NAR and Case-Shiller studies were much lower in the same quarter.

Time To Think Different

Equities are expected to slow in the shorter term, and a decrease in real house values will continue to put pressure on cash flow and spending habits as loan reset to higher interest rates.  A shift is possible as people see housing stall, investment slow, and find the only way to really impact their savings may be to actually save more (meaning spend less).  While this isn't appealing to most, it may be a simple fact of the forces that are lining up... and as we say the timing for good financial education of spending and savings habits around the consumer assets and liabilities will be more valuable than ever.

 

Annual Mortgage Reviews Bring Borrowers Closer to Achieving Financial Goals

 

Yearly reviews are a great way to keep on track with your financial goals. You're probably already meeting with your financial advisor and other asset manager for quarterly or annual reviews, and you should do the same with your Mortgage Planner as well. An annual mortgage check-up is an ideal way to make sure your mortgage is still having the maximum positive impact on your overall financial plan.

 

A lot can happen in one year. The market can take turns that can open up new opportunities, such as reduced interest rates, new loan products or changes in home values. Furthermore, your personal and financial situation could be mildly to radically different than it was just 12 months prior. Perhaps one or more of the income earners got a raise or lost a job. Maybe you received an inheritance. Even a minor, one-year change in one of your kids' college plans could impact your financial situation in a way that would benefit from an adjustment in your mortgage strategy.

 

Periodic reviews serve several purposes. First, they establish a consistent path toward achieving your financial goals. Secondly, they ensure that you stay on track with your goals. Sometimes plans need minor adjustments, but without the knowledge that comes from a thorough evaluation, those minor adjustments may go unnoticed. Often, by the time an adjustment becomes apparent, you may have already lost valuable time and/or resources that could have been spared with a few minor modifications along the way. Finally, periodic reviews help to keep you accountable toward your commitment to achieve your objectives. Without accountability, it's very easy to let your savings and investment actions fall by the wayside, especially when unexpected expenses arise. Knowing that you'll be discussing your action steps will help to keep you committed to your goals.

 

Consider scheduling a periodic review with your Mortgage Planner in conjunction with your asset manager's review. In addition to saving time, you'll also gain the advantage of your own personal management team for your financial asset-building program.

 

Remember that getting clarity on your financial situation is never a waste of time. If you find that your current financing is more desirable than the financing that is available in today's market, you'll know that your Mortgage Planner did a great job advising you last time. If you find that your changing circumstances have dictated that a new loan will better suit your new situation, your Mortgage Planner can bring you one step closer to achieving your financial goals. Call us for a free mortgage planning review.

 

 

Know Thy Credit Score

 

Benjamin Franklin once said "credit is

money". Although he was referring to actually

having credit with a store to purchase things, his

quote still rings true today. Whether renting a new

apartment, applying for a credit card, a mortgage

or even homeowners insurance (yes, homeowner's

insurance), your credit score will determine the

particular interest rate or premium you are

quoted. In essence it has become the filter many

industries use to decide if they want to do

business with you and at what price. This article

explains what a credit score is, what it is based

on, and how it should be maintained.

The most common credit score is the FICO

score, created by the Fair Isaac Corporation. It is

the standard for the mortgage industry as well as

many others, and it can range from a low of 350

to a high of 850. The higher the score, the lower

the interest rate you will be offered, potentially

saving you hundreds if not thousands of dollars a

year. You want to remain above 720. About half of

the country maintains a score above this magic

number. As you begin to move below this number,

interest rates may begin to rise. Fall below 500

and you may not be able to take out a mortgage

even if you currently have one. How the score is

determined is one of the most common questions

we get from clients trying to improve their credit

score? While we do not know the exact formulas

used by the three biggest credit agencies using

FICO's standard of scoring, here is what we do

know.

There are five key elements that make

up your score

Your payment history, or how you pay your

bills, makes up 35% of your score. How much you

owe is 30% and how long you have had credit is

another 15%. The type of credit you have and any

new credit issued make up 10% each. Factors that

are NOT considered in this formula are your

income, savings, age, race, geographic location or

marital status. Basically the score indicates your

track record of making payments to companies

you owe money to including your utility bills.

Although it seems it should be an exact formula it

is more of an art form in knowing what affects

each component.

The largest factor is "do you pay your bills on

time". While it is best to always pay your bills on

or before the date that they are due, paying a bill

a few days late and incurring a late charge will not

necessarily go on your credit report. Having a

"late" on your credit report means that the bill is

30 days or more past its due date. The more

"lates" you have, the lower your score will go. If

you have a bill that is 60, 90 or even 120 days

late your score will rapidly decrease. But even if

you already have a "late" on your report, the

more time you gain between that date and the

current date the more your score will improve.

The mortgage industry has two major thresholds

when looking at any late payments on your

report: Are they older than 12 months and older

than 24 months. Each milestone will provide you

with better financing solutions as your late

payments fade with time. In addition, a mortgage

© 2007 Forgotten Equity. All rights reserved.

"late" is much more serious than a credit card

"late". So if it comes down to a choice "which bill

should I pay?" always choose your mortgage

payment and never miss paying this one. The

consequences are far too great.

How much you owe combined with what types

of credit you have available, make up the "art"

side of the calculation. You might think that if you

owe less you will have a better score.

Unfortunately that is not always true. This portion

of your score is determined by a delicate 3-way

dance between the types (mortgage, car loans

and credit cards), how much you owe, and how

much you have available to you. Having too many

credit cards can be a negative and so can having

only one. Having a credit card with a large limit

can be a good thing, as long as you are not near

that limit. Same with a second mortgage or a

home equity line of credit. When you have lots of

credit available you want to make sure you "use"

that credit but do not maintain a high balance.

The closer your balance is to the maximum credit

available to you, the lower your score will go.

The last two components of your score are the

length of your history and new accounts. Of

course the longer you have a credit history the

longer your track record will be, but another

important factor is how long you have had a

particular account. The longer an account is open

and active the better your score will be. Opening

up a bunch of new accounts and playing the credit

card-switching balances game does not look good.

So now you know what a FICO score is and how it

is calculated. The big question is now: how do you

maintain it?

As the saying goes, most people don't plan to

fail, they simply fail to plan. It happens all too

often in our business, but if clients regularly

monitored their credit scores we would be able to

save them thousands of dollars on their

mortgages. What this means is, if you are

planning to buy a home, don't just go look at

houses, make an offer and then get a mortgage.

You may not like what you are offered as a result

of your FICO score. Our suggestion is to plan for

this event. The same holds true if you are thinking

about refinancing.

Improving your credit score is kind of

like getting ready to run a marathon

You can't just sign up today and expect to run

tomorrow. If you have a poor credit history or if

there is inaccurate information on your report it

can take months to repair and correct. We have a

saying that we have been using years, Make Life

Happen! Don't sit back and let it happen to you.

Being proactive with your credit scores (like many

other areas of your life) will improve the results

and your experiences. Some of you reading this

will be thinking you don't have to worry about this

because you have never missed a payment and

have excellent credit. Well, so thought a client

when we were in the process of obtaining a loan

for him.

This client, we will call Mark, was referred to us

by an attorney and was only 30 days away from

his purchase closing date. Mark advised us that

his credit was perfect. However, when we ran it as

part of his application, it turned out that it was

not. One of the student loans that Mark co-signed

on behalf of his daughter indicated several missed

payments despite the fact she was still in school

and the first payment was not due for another 2

years. We still got the mortgage approved at a

rate and payment Mark could live with but had

Mark proactively monitored his credit scores he

would have had a better interest rate. Mark did

contact the student loan provider and they agreed

that it was a mistake but the damage was done. It

took three months to reflect the corrected

information on his report, too late to affect that

mortgage.

In that example "life happened to Mark" and

had he been proactive about his credit score he

would have been better off. This is not a hard

thing to do – it is just like going to the gym, you

have to do it regularly. While we are not

suggesting that you monitor your scores daily or

even weekly, we are suggesting that you institute

a bi-annual credit review to ensure your credit is

the best it can be so you are not caught off guard

like Mark.

If you would like to read more in-depth

information about what you need to know to take

control of your finances simply go to

www.MyFICO.com and download a FREE 20-page

booklet entitled "Understanding Your FICO Score".

They also have a paid service to alert you anytime

there is a change to your score and/or credit

history. In today's world of stolen identity this

could prove to be a prudent investment. Not only

will you save money by ensuring you have good

credit but you may be able to prevent any

fraudulent charges against your name as well as

the accruing interest and legal fees should you be

an unfortunate victim. You can also obtain free

credit report by visiting

www.annualcreditreport.com. At the very least,

monitor your credit twice a year and you will be

happy you did. Make Life Happen!

“Buy When There’s Blood in the Streets”—Baron Rothchild

Over the next 2 years there will be great opportunities to invest in real estate for those people positioned to take advantage of this down turn. The time to buy is when everyone is wants to or is "forced" to sell. Here are two great opportunities to learn more about if you're serious about investing in real estate.

Number 1: Short Sales—A Win/Win/Win situation
A short sale involves a complex transaction on a property where the owner is in default on the loan payments and has received a Notice of Default, and where the market value of the property is less than the amount owed. The 'short' refers to obtaining a discount on one or more of the notes on the property. Investors will usually turn the property quickly for a nice profit.

There are many factors to consider in a short sale even to determine whether it's a deal worth pursuing. The investor must understand all title issues, have complete knowledge of all outstanding notes and liens against the property, and have a good sense of what the Brokers Price Opinion is likely to be. Even after finding a good candidate, the investor needs to be knowledgeable in negotiations, in how to put together a complete and professional offer packet for the banks and in how to obtain the best possible BPO. As well, it is always best to have buyers lined up before hand.

We've selected this strategy as one of our top two because there are so many opportunities in today's market. Many homeowners are in serious trouble out there, with some researchers estimating that foreclosure sales may account for up to 10% of the properties in many markets in California. The recent flat and down market combined with too many 100% financing deals with adjustable rate mortgages has created an opportunity for savvy investors. A typical short sale in California can net the investor $25,000-$40,000.

If you don't know EXACTLY what you are doing, you should not be entering this arena. However, if you DO have the knowledge to systematize this strategy, it can be lucrative in today's market, not to mention it's a win/win/win situation: homeowners may be able to prevent foreclosure and can move on with their lives, the bank gets the bad debt off their books, and YOU pocket a nice piece of change!

Number 2: Multi-tenant—The Opportunity Behind the Opportunity
If you know what you're doing, opportunities to cash in on the current market are everywhere. Case in point is the multi-tenant market, or what we see as the opportunity behind the short sales opportunity.
Think about all those people facing foreclosure leaving their homes to become renters…and rents are lagging far behind property values…

So, will there be upward pressure on the rental market over the next few years? We think so. Where would you go with your investments to take advantage of this situation? Perhaps it's time to consider multi-tenant situations. Remember, though, that you are now entering the world of commercial real estate. These are the higher stakes tables. Before you sit down at one of them, you really need to have 'game.' If you'd like more information on how to take advantage of these opportunities contact us.

The 212 Degree Experience

"At 211 degrees water is hot. At 212 degrees, it boils. And with boiling water, comes steam. And steam can power a locomotive."

    -212 The Extra Degree by Sam Parker and Mac Anderson

This past week I had the opportunity to go down to Palms Springs to an event named "Sales Mastery". The focus of this event was all in going that extra degree in life, business and relationships. I believe that once we embrace this truth we can accomplish amazing things. It was great to spend three days with the top mortgage professionals from all over the country all of us looking to improve our business and our life.

Out of nearly 250,000 people who call themselves loan officers only 1400 people attended. Sadly, I think this says a lot about our professions. Just a short two years ago there were over 450,000 people who called themselves "loan officers". That number has dropped significantly but even with that drop in numbers 60% of all loan officers have less than 5 yrs experience and have never experienced a down real estate market. What this tells me is that today, more than ever it's crucial to work with an experienced loan professional. I feel fortunate to say that here at Evergreen Pacific I am the newest Mortgage Advisor and still have nearly 13 years with the company.

Over the next several months we will be implementing the 212 philosophy into our business. Good things will be coming down as a result of the new outrageously high goal we are setting for our customer experience. During the event I had the opportunity to meet Horce Schultze. Mr. Schultze is one of the founders of the Ritz-Carlton luxury hotel chain. In case you don't know much about his company the Ritz is considered to be the best luxury hotel chain bar none. They've earned that distinction by offering customer service that makes any other business you have ever dealt with look mediocre at best. They work outrageously hard every single day to exceed the expectations of their visitors and have put systems in place to make that happen. It is my new passion to see that Evergreen is known by it's clients and the community to offer that same "Ritz-Carlton experience to its clients. Watch over the next several months and you'll see what I mean.

How to Determine Whether Your Loan Officer is Reputable

In slower markets, some loan officers may feel pressured to close deals that aren't in the homeowner's best interest. In order to avoid getting into difficult and financially compromised positions with their mortgages, borrowers are well advised to be acutely aware of the signs of a responsible loan officer when selecting a mortgage professional.

 

First, look for a Mortgage Planner whose values are focused on helping individuals to achieve their financial goals in both the fastest and the safest way possible. A reputable Mortgage Planner will show you the numbers associated with the proposed loan and provide you with concrete information that backs up his or her claims. Review all of the numbers. If they don't add up, ask for clarification. If your loan officer can't or won't answer your questions, move on--without the loan.

 

Secondly, a responsible Mortgage Planner will present you with financial information that goes beyond the point of the transaction, and will illustrate the total cost of the loan over time. If your loan officer is focusing only on rates and fees, you may be working with someone who's looking out for his or her own best interests, not yours.

 

Responsible Mortgage Planners will also tailor their strategies to fit your unique situation. In other words, they always take your personal financial goals into account. No one should try to place you into a loan without knowing the intricacies of your personal financial situation.

 

Finally, if your loan officer is advising you on issues other than mortgages, you could be working with someone who is compromising your best interests. Issues like investment rates of return and real estate appreciation aren't the areas of expertise for the vast majority of mortgage professionals and should be left to the professionals who have training and direct experience in those areas.

 

When seeking a loan officer, look for someone who specializes in mortgage planning, which is the process of evaluating a borrower's unique financial situation and advising the borrower on a loan that best suits his or her individual needs and goals. If your loan officer is trying to put you into a loan without evaluating how that loan will effect your entire financial situation--including debt management, tax benefits, investment goals and net worth--it's quite possible that you're only getting half of the picture.

 

The bottom line is that your mortgage representative should always be looking out for your best interests, regardless of market conditions. If you have any questions about any offer you've been presented by a lender feel free to call my office, we'll be glad to give you a fair and honest assessment.

What is Your Money Blueprint?

 

by T. Harv Eker


All of us have a personal money blueprint ingrained in our subconscious minds that will determine our financial lives. Have you ever wondered why some people seem to get rich easily, while others are destined for a life of financial struggle? Is the difference found in their education, intelligence, skills, timing, work habits, contacts, luck, or their choice of jobs, businesses or investments?

The Shocking Answer is None of the Above!
No doubt you've read other books, listened to tapes or CDs, gone to courses and learned about numerous money systems, be they in real estate, stocks or business. But what happened? For most people, not much! They get a short blast of energy and then it's back to the status quo.

Finally, there's an answer. It's simple, it's law, and you're not going to circumvent it. It all comes down to this: If your subconscious "financial blueprint" is not set for success, nothing you learn, nothing you know and nothing you do will make much of a difference. I'll explain more about this later.

My Obsession with Becoming a Success
Like many of you, I supposedly had a lot of potential but had little to show for it. I read all the books, listened to all the tapes and went to all the seminars. I really, really, really wanted to be successful. I don't know whether it was the money, the freedom, the sense of achievement or just to prove I was good enough in my parents' eyes, but I was almost obsessed with becoming a success.

I left college after my first year and spent the next 12 years trying to make ends meet. Any money I made, I lost. I really couldn't rub two nickels together. I thought that I was fairly intelligent and a good person so I couldn't understand why the one thing that I wanted, financial success, completely eluded me.

Then, as luck would have it, I got some advice from a rich friend of my father, a wealthy man in many ways. He was a strongly principled person who had a really big heart. He said to me, "Harv, if you want to be successful at business, you need to do what successful business people do. Rich people think the same thoughts and take similar actions, albeit in different vehicles. So by reading, studying and modeling them you can pick up what they do."

It was time to put what I learned to the test. I opened my next business, which was one of the first retail fitness stores in all of North America. And using the principles I learned, I became a millionaire in only two and a half years. The business was so successful that I opened 10 stores.

After selling the company, I took a few years off to refine my strategies and began doing one-on-one business consulting. And today, my sole mission is to teach these same principles to people throughout North America.

I would like to share with you a little about how each of us is conditioned to think and act about money. I'll help demystify for you why some people are destined to be rich and others are destined for a life of struggle. You'll understand the root causes of success, mediocrity or financial failure and begin changing your financial future for the better.

What is Your Money Blueprint?
Give me five minutes with anyone and I can predict their financial future for the rest of their life. How? By identifying their money blueprint.
Each of us has a personal money blueprint already ingrained in our subconscious mind that will determine our financial life. What that means is you can know everything about business, marketing, communications, negotiation or real estate, for example, but if your subconscious money blueprint isn't preset to a high level of success, you will never amass a large amount of money.
We've all heard of Donald Trump and what he has accomplished. Here is this multibillionaire who at one point lost everything, and within two years he's got it all back and more. Why? His money blueprint is set for "high." On the other side of the coin we have lottery winners. They win millions of dollars and within five years virtually half of them are back where they started. Why? Their money blueprint is set for "low."

How Your Money Blueprint is Formed
What people have to realize is that we are all taught and conditioned in how to deal with money. Unfortunately, many of us were taught by people who didn't have a lot of money, so their way of thinking about money became our natural and automatic way to think.

Your mind is nothing more than a big and spacious storage cabinet. In this mental file cabinet you file and store information. Where does this information come from? It comes from your past programming. That determines every thought that forms in your mind.

So the questions becomes, "How are we conditioned?" We are conditioned in three primary ways in every arena of life, including money:

• The first influence - Verbal programming: What did you hear when you were young?
  
• The second influence - Modeling: What did you see when you were young?
  
• The third influence - Specific incidents: What did you experience about money, success and rich people when you were young?
  

The First Influence: Verbal Programming
Did you ever hear phrases like, "Money is the root of all evil;" "Save your money for a rainy day;" "Rich people are greedy;" "Rich people are criminals;" "filthy riches;" "You have to work hard to make money?" In my household, every time I asked my father for any money I'd hear him scream, "What am I made of...money?"

Every statement you heard about money when you were young remains lodged in your subconscious mind as part of the blueprint that is running your financial life. Naturally, you don't even have to think about it. You don't even see it. You go to your money file, pick it out and do what you're supposed to do with it. That's because your subconscious conditioning determines your thinking. Your thinking determines your decisions and your decisions determine your actions, which eventually determine your outcomes.

The Second Influence: Modeling
The second way we are conditioned is called modeling. There is a saying, "Monkey see, monkey do." And, of course, human beings are not far behind. Generally, we tend to be exactly like one or a combination of both of our parents in the arena of money.

So the question is, what were your parents like around money when you were growing up? Did they manage money well or did they mismanage it? Were they spenders or were they savers? Were they shrewd investors or were they non-investors? Was money always a struggle in your home or was it a source of joy and ease? Whatever your answers, you will be very similar to that. Although most of us would hate to admit it, there's more than a grain of truth in the old saying, "The apple doesn't fall far from the tree."

On the other side of the coin, some of us are exactly the opposite of one or both parents when it comes to money. Many people who come from poor families become angry and rebellious about it. Often they either go out and get rich or at least have the motivation to do so. But there's one little hiccup. Whether such people get rich or work very hard trying to become successful, they usually aren't happy. Why? Money and anger become linked in their minds, and the more money such individuals have or strive for, the angrier they get.

The reason or motivation you have for making money or creating success is vital. If your motivation for acquiring money or success comes from a non-supportive root such as fear, anger or the need to prove yourself, your money will never bring you happiness.

The Third Influence: Specific Incidents
The primary way we are conditioned is by specific incidents. What did you experience when you were young about money, wealth and rich people? These experiences are extremely important because they shape the beliefs - or rather, the illusions - you now live by.

Let me give you an example. A woman who was an operating room nurse attended the Millionaire Mind Intensive seminar. "Josey" had an excellent income, but somehow she always spent all of her money. When we dug a little deeper, she revealed she remembers when she was 11 being at a Chinese restaurant with her parents and sister. Her mom and dad were having yet another bitter argument about money. Her dad was standing up, screaming and slamming his fist on the table. She remembers him turning red, then blue, and then falling to the floor from a heart attack. She was on the swim team at school and had CPR training, which she administered, but to no avail. Her father died in her arms.

Since that day, Josey's mind linked money with pain. It's no wonder, then, that as an adult, she subconsciously got rid of all of her money in an effort to get rid of her pain. It's also interesting to note that she became a nurse. Why? Is it possible she was still trying to save her dad?

What is Your Money Blueprint Set For?
Now it's time to answer the million-dollar question: "what is your current money and success blueprint, and what results is it subconsciously moving you toward? Are you set for success, mediocrity or financial failure? Are you programmed for struggle or for ease around money? Are you set for working hard for your money or working in balance? Are you set for having a high income, a moderate income or low income? Are you programmed for saving money or for spending money? Are you programmed for managing your money well or mismanaging it?

As I stated earlier, your money blueprint will determine your financial life - and even your personal life. If you're a woman whose money blueprint is set for low, chances are you'll attract a man who is also set for low so you can stay in your financial comfort zone and validate your blueprint. If you're a man who is set for low, chances are you'll attract a woman who is a spender and gets rid of all your money, so you can stay in your financial comfort zone and validate your blueprint.

So again, how can you tell what your money blueprint is set for? One of the most obvious ways is to look at your results. Look at your bank account. Look at your income. Look at your net worth. Look at your success with investments. Look at your business success. Your blueprint is like a thermostat. If the temperature of the room is 72 degrees, chances are good that the thermostat is set for 72 degrees.

The Roots Create the Fruits
The only way to significantly change the temperature in the room is to reset the thermostat. In the same way, the only way to change your level of financial success permanently is to reset your financial thermostat, otherwise known as your money blueprint.

In life, our fruits are called our results. So what do we tend to do? Most of us focus even more attention on the fruits, our results. But what is it that actually creates those fruits? The seeds and the roots, that's what.

What's under the ground creates what's above the ground. What's invisible creates what's visible. So what does that mean? It means if you want to change the fruits, you will first have to change the roots. If you want to change the visible, you must first change the invisible.

In every forest, on every farm, in every orchard on Earth, what's under the ground creates what's above the ground. That's why focusing your attention on the fruits you've already grown is futile. You cannot change the fruits already hanging on the tree. You can, however, change tomorrow's fruits. But to do so, you'll have to dig below the ground and strengthen the roots.?

Mark Victor Hanson’s Relationship Building Tips

 

 

 

Positive relationships are at the heart of every successful business. Yet few people take the time to really understand how successful relationships are cultivated and maintained.

 

In a recent issue of Mortgage Planner Magazine, Mark Victor Hansen, co-author of "The One-Minute Millionaire"
and "Chicken Soup for the Soul", provided his tips for building and maintaining successful relationships.

 

When relationships thrive for a while, but then fall apart, Hansen suggests evaluating what went right when things were thriving as well as what went wrong as things began to fall apart. Understanding the factors leading to the success--or difficulties--of the relationship will help you to repeat the positive while avoiding the negative.

 

Secondly, Hansen suggests learning to nourish your most valuable relationships in a win-win atmosphere. Many people are so focused on what they want, that they forget all about the other person in the relationship. "In business, win-win means having a genuine concern for the other person," writes Hansen. "That they win as much as you do." When people focus solely on squeezing every last penny out of a business situation, it creates distrust, cynicism, anxiety and questionable ethics. This doesn't mean to cave in and give away the farm, either. Win-lose, whether you're the winner or loser, will never work in the long run. Focus on creating a positive outcome for everyone involved. This will serve you well in the duration of the relationship.

 

You should also remember to invest your time wisely. There will be clients that want to dominate your time, yet give you little in return. It's a good idea to limit your time there. Balance things out by putting more time in with your core clients. Take the time to learn as much as you can about them, including their likes and dislikes, favorite restaurants, hobbies, sports and pastimes and your business reap the rewards. If you find that you have toxic people around you, Hansen advises getting away from them immediately. They'll drain your time, your energy and your resources, which are far too valuable to sacrifice.

 

Finally, be willing to go the extra mile. Remember, it takes time to cultivate successful relationships, but as you focus more and more on win-win relationships, behaviors like going the extra mile will become more like second nature to you. And as your relationships flourish, Hansen advises, you'll find yourself becoming richer, and not just financially.

 

 

 

 

In Praise Of A "Toxic" Loan

The loan with the worst reputation these days may be the pay-option ARM. Monthly payments for this adjustable-rate mortgage go up when interest rates rise. And borrowers can sink deeper into debt because they're permitted to pay less than the minimum interest due each month, with the balance added to the principal. If homeowners hit the maximum they're allowed to borrow, their monthly minimum shoots up, which can force them into default (BW—Sept. 11, 2006).

A new academic study concludes that this most toxic of all mortgages is, in a perfect world, the best. How can that be? Because if borrowers have erratic incomes but perfect self-control, they can make small payments in lean months and catch-up payments in good times. That flexibility lessens the risk of default caused by a hiccup in income, a benefit to both borrowers and lenders.

The authors of the National Bureau of Economic Research working paper, Tomasz Piskorski of Columbia Business School and Alexei Tchistyi of New York University's Stern School of Business, say that rather than banning the loans, as some have advocated, the U.S. should educate consumers about their hazards and how to use them properly. Piskorski calculates that the ARMs' total potential benefit to borrowers and lenders combined is at least $50 billion, so even hefty spending on education would be worthwhile.

The public reaction to the study findings has been mixed. One comment on BusinessWeek.com's Hot Property blog: "Experts shouldn't be promoting this type of product for the general population, even just in theory."

By Peter Coy

How to Manage Home Equity to Build Wealth

How the Affluent Manage Home Equity to
How to Safely and Conservatively Build Wealth

 

If you had enough money to pay off your mortgage right now, would you? Many people would. In fact, the 'American Dream' is to own your own home, and to own it outright, with no mortgage. If the American Dream is so wonderful, how can we explain the fact that thousands of financially successful people, who have more than enough money to pay off their mortgage, refuse to do so.

The answer? Most of what we believe about mortgages and home equity, which we learned from our parents and grandparents, is wrong. They taught us to make a big down payment, get a fixed rate mortgage, and make extra principle payments in order to pay off your loan as early as you can. Mortgages, they said, are a necessary evil at best.

The problem with this rationale is it has become outdated. The rules of money have changed. Unlike our grandparents, we will no longer have the same job for 30 years. In many cases people will switch careers five or six times. Also, unlike our grandparents, we will no longer live in the same home for 30 years. Statistics show that the average homeowner lives in their home for only seven years. And unlike our grandparents, we will no longer keep the same mortgage for 30 years. According to the Federal National Mortgage Association, or Fannie Mae, the average American mortgage lasts 4.2 years.

 

Given these statistics, more middle class homeowners are choosing to use their mortgage as a tool just like the wealthy -- those with the ability to pay off their mortgage but refuse to do so. Will you be one of those who create a new, liquid, financially secure dream?