Inmates learn new skills as part of their rehabilitation. It is a wise societal investment to give thieves training in something other than thievery so they can have an opportunity to begin a new productive life -- if they choose to live differently after prison. Unfortunately, many skills taught in prison give criminals new skills to be even better criminals.
While I was in Edgefield Federal Prison Camp, many of us white-collar felons taught classes to the other inmates. Most of the classes involved helping inmates get their high school diploma (GED). Like other inmates who had the opportunity to teach, I felt good to find a way to give back.
Other classes helped inmates prepare for a career after prison. Hair cutting was a popular skill to learn, though many states prohibit felons from cutting hair….must have something to do with scissors. Tattoo art was also popular but the shortage of clean needles kept the enrollment for that particular class to a minimum.
So what was the most popular class during my time in Edgefield during 2001-2002, “How to be a Mortgage Broker”. The class was taught by an inmate, Eric, who was doing 3 years for mortgage fraud. So I guess that made him an expert. Each semester (a 2-hour class met 3 days a week for a month) the enrollment prompted a waiting list for the class. The waiting list resulted because the prison would only allow 25 copies to be made of the various forms that were a part of the curriculum (about 20+ pages of forms, work sheets and exemplar credit reports). Those with more time left on their sentence were pushed off to another semester to make room for those that would hit the streets in a few months. If you were doing 5+ years, you didn’t have a chance. Even prison classes are selective in their enrollment.
Mortgage Brokering was a great career because institutions did not care whether you were a felon or not, as long as you had a legitimate deal. And in 2002-2006 they were all legitimate. There was no licensing requirement and the inmate would return home with dreams of home-ownership to a host of friends and family. Testimonials to the success of the program flowed back to the instructor and he shared these with the next class.
Professor Eric probably meant well. The would-be brokers that he fed into the market were just trying to make a living in a business that seemed more lucrative and easier than selling the drugs that had put them in prison to begin with. Professor Eric did not do too bad either. He received $30 in commissary goods per inmate ($750 per session). Not bad for a place where the legitimate wage is about $0.15/hour for a prison job. Granted, there were only 4 sessions a year, but Eric also offered private lessons not sanctioned by the prison.
When I left prison, Professor Eric had turned his energy toward his own career once he secured his release, and it wasn’t Mortgage Brokering. He had created a business plan for a mutual fund that bet on NBA games with a guaranteed return of 12%. I told him that it sounded like a Ponzi Scheme, and I’ll never forget his reply, “What’s that?”
The entire housing market in California is a Ponzi Scheme. The newly released felons will be completely comfortable originating loans here in California. The question is, will you be comfortable having a convicted felon get a loan for you?
A private Ponzi prison
Perhaps we should make all the Ponzis who stripped the equity from small condos live in them until they pay the money back.... Actually, that is occurring to those who continue to make their payments. I wonder if they feel like they are in prison?
Today's featured property was purchased on 3/17/2003 for $279,000. The owner used a $223,200 first mortgage, a $41,850 second mortgage, a $13,950 third mortgage, and a $0 down payment.
On 11/10/2004 he refinanced with a $336,000 first mortgage.
On 12/27/2005 he refinanced again with a $360,000 first mortgage and a $40,000 second mortgage.
Total property debt is $400,000.
Total mortgage equity withdrawal is $121,000. Not bad for a small condo.
Total squatting time is 17 months so far.
Foreclosure Record Recording Date: 11/09/2009 Document Type: Notice of Sale
Foreclosure Record Recording Date: 07/31/2009 Document Type: Notice of Default
Home Purchase Price … $279,000 Home Purchase Date .... 3/17/2003
Net Gain (Loss) .......... $3,000 Percent Change .......... 1.1% Annual Appreciation … 0.9%
Cost of Ownership ------------------------------------------------- $300,000 .......... Asking Price $10,500 .......... 3.5% Down FHA Financing 4.31% ............... Mortgage Interest Rate $289,500 .......... 30-Year Mortgage $57,332 .......... Income Requirement
$1,434 .......... Monthly Mortgage Payment
$260 .......... Property Tax $0 .......... Special Taxes and Levies (Mello Roos) $25 .......... Homeowners Insurance $328 .......... Homeowners Association Fees ============================================ $2,047 .......... Monthly Cash Outlays
-$130 .......... Tax Savings (% of Interest and Property Tax) -$395 .......... Equity Hidden in Payment $16 .......... Lost Income to Down Payment (net of taxes) $38 .......... Maintenance and Replacement Reserves ============================================ $1,577 .......... Monthly Cost of Ownership
Cash Acquisition Demands ------------------------------------------------------------------------------ $3,000 .......... Furnishing and Move In @1% $3,000 .......... Closing Costs @1% $2,895 ............ Interest Points @1% of Loan $10,500 .......... Down Payment ============================================ $19,395 .......... Total Cash Costs $24,100 ............ Emergency Cash Reserves ============================================ $43,495 .......... Total Savings Needed
Property Details for 90 BRIARWOOD #105 Irvine, CA 92604 ------------------------------------------------------------------------------ Beds: 2 Baths: 1 full 1 part baths Home size: 1,125 sq ft ($267 / sq ft) Lot Size: n/a Year Built: 1978 Days on Market: 4 Listing Updated: 40443 MLS Number: P753437 Property Type: Condominium, Residential Community: Woodbridge Tract: Wbrs ------------------------------------------------------------------------------ According to the listing agent, this listing may be a pre-foreclosure or short sale.
Quite Inside Loop Location, 2 Huge Bedrooms, One with Walk-In Closet, Large Laundry Room.
Quite Inside Loop Location? I think he meant "quiet."
Last week I was in Austin Texas for a few days. It was the Keller Williams Realty “Mega-Agent” Camp. Two intense days of the newest ideas, technologies, applications, and methods to better serve our clients. Much of the techie geeky stuff was way over my head, but I did learn a lot, and am intent on implementing what I did get. No One could ever put all of it into practice, so I’m just going to do the things that make sense.
One of the things that I learned is that I could upgrade the MLS SEARCH feature that we use for our clients. I had previously picked the “IDX” from Wolfnet because you could search by subdivision name. For example in the top navigation bar you can choose “subdivision” and type in McNeil or Paradise Palms or Rancho Nevada. Those are big subdivisions with well known names. The “Downtown Area” on the other hand, is made up of dozens of smaller subdivisions and neighborhoods. Some of the custom home pockets don’t have a subdivision name at all. We needed a better way, so I’ve upgraded the system.
NOW, you can also do a “MAP SEARCH” to better isolate the Vintage Homes and Mid Century Modern Neighborhoods of Las Vegas. I set it up to automatically center on the middle of the Downtown Area. The maps are built using MapQuest, and function as they would if you were directly on MapQuest, in terms of panning, zooming etc.
You can further refine the search under the map, just as you used to be able to.
Using the map search is a quick and easy way to find out about the house down the street that just got listed.
My experience is that most buyers spend a month or a few looking at properties online before they ever contact an agent. You can save the searches if you like, or start over each time.
If you click and hold on the map, you can draw a box, which will automatically zoom in on the box you’ve drawn.
Once you have the search result properties that you want, showing on the map, you can scroll over each little property icon to see the first picture and basic information.
Clicking anywhere in the highlighted property will take you to all the pictures and the full listing.
When you’re looking at an individual property listing, you can click on “MAP IT”.
Since the maps are tied directly into MapQuest, you can then see what’s going on in the surroundings, find the schools, shopping, churches, parks and whatever.
I hope you’ll like this new mapping feature. Feel free to use it whenever you like, and for whatever purpose it’s useful to you.
ALL THE GRAPHICS ARE CLICKABLE THUMBNAILS if you want to see them in an expanded version.
Of course, if you’ve found a home you’re interested in, or want to talk about the property you’re thinking of selling –
As we head to the end of the 2010 election cycle, Republican’s are announcing in their Pledge to America that they want an end to the government takeover of Freddie Mac and Fannie Mae.
Democrat’s meanwhile like the idea of the home lending industry being under government control so that it can influence housing policy from a fiscal level.
Yet we all know that dismantling these programs will create even more uncertainty in the housing and mortgage markets. The most likely result is lower housing prices and higher interest rates. Something I think no politician is really eager to see happen, and no one in the real estate industry can cope with right now.
So what is the answer. David Reilly at the Wall Street Journal thinks the ultimate goal is gridlock and fingerpointing. If the Republicans take over Congress with the Democrat Obama in the White House everyone can blame each other, rally their bases, and blame each other in full voice.
While doing absolutely nothing but take the lobbyist’s money every step of the way.
You know, the Washington Way.
Personally I would love to see a 5 year plan for unwinding the housing industry from the Federal Government. We are not going to change the landscape overnight without adding even more pain into an already beat up industry. However, a prudent plan for banks to start adding solid and prudent loans to their balance sheets while allowing the glut of bad loans to slowly work their way out of the system would be beneficial.
It is like an antibiotic treating an infection. You do not lop off the limb that has the infection. Modern medicine has progressed beyond that point. But a 10 day session of antibiotics could just make everything heal correctly.
Let’s hope prudent minds and not political hyperbole address the big issues in the housing market in the coming year.
For all the talk, paralysis may be more likely, especially if elections change control in Congress. And secretly, this may be just what politicians from both parties prefer.
Necessary changes to the mortgage-finance system will be disruptive. Consider that Fannie and Freddie between them guarantee or own $5.4 trillion in mortgages. It would be a tall order for the banking system suddenly to step up and take on the risk on all new mortgages.
Scrapping guarantees would likely send mortgage rates up and house prices down. That would ultimately help set a clearing price for housing. But it would hardly score political points, given that housing accounts for 25% of U.S. households’ assets, according to the Federal Reserve.
Granting full government backing to mortgages, on the other hand, would add to already excessive U.S. debt and result in even greater distortion of housing markets, possibly paving the way for worse crises. via the WSJ
Thanks for reading this post. If you would like to see more articles like this, please come visit The Real Estate Bloggers. where it was originally published.
This sustainable work pod was designed by Thomas Biggs and Tony Carr. It was hoped to be an eco-friendly work place that can be placed everywhere.
This curvy pod is designed as a modular pod, completed with several functions, like a desk, a bench that can be pulled out to become a futon bed, overhead, Murphy Table unit that provide additional workspace, etc. The Murphy Table is inspired with furniture in a sail boat. The table can be folded at the wall. Lift-open cabinets, whose doors continue the curved contour of the ceiling, are available.
Murphy Table
The interestiong features are the sustainable features provided for this pod. This top is completed with rooftop solar, R30 insulation, and made from eco-friendly materials. The design is different to create a work environment that is not usual than ordinary cubical pod. This pod is sold on the price of USD 10,000.
You can further refine the search under the map, just as you used to be able to. 
If you click and hold on the map, you can draw a box, which will automatically zoom in on the box you’ve drawn. 
Once you have the search result properties that you want, showing on the map, you can scroll over each little property icon to see the first picture and basic information. 
When you’re looking at an individual property listing, you can click on “MAP IT”. 
Since the maps are tied directly into MapQuest, you can then see what’s going on in the surroundings, find the schools, shopping, churches, parks and whatever.
