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Mar 2012 Dean Vlamis Newsletter

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DEAN VLAMIS

1) Getting a mortgage today requires more documentation and scrutiny of finances than in the past when lending standards were more lax. 2) There is a perception that the "dream of homeownership" is no longer attainable due to these stricter standards, but the reality is that standards were made looser in the past, contributing to the financial crisis. 3) While the process is more difficult now, interest rates remain low, so the tradeoff is that homeowners will save money in the long run through lower rates even if qualifying requires more disclosure and verification of finances upfront.

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deanvlamis MARKET NEWS 2936 W. Belmont Avenue Chicago 60618 773.612.2666 | dean@perlmortgage.com www.deanvlamis.com True or false: it is harder to get a mortgage enough. In fact, big banks like Chase and reality is good or not is a different issue. today than it is to actually get a girlfriend CitiMortgage were sued by the Federal Sometimes it is good to live in your as a freshman in high school. (Answer government for not “lending enough” in illusions or innocence. Facing reality can later.) certain areas. be a tough thing. This is actually a legitimate question, and Now of course these same intellectual Here we go… from my end I hear a lot of frustration elitists, who refuse to live by the same rules from clients going through the process. that they impose on us, are demonizing and The Harlem Globetrotters come to mind. Yes, it is much more difficult to get a actually suing banks, mortgage companies As a child we used to adore them and were loan these days, and requires a lot more and lenders for their reckless and unethical amazed at their incredible talent. I mean, documentation. On top of this, everything practices of lending to people who could they could play a ball game, goof around, in the file is scrutinized like it never not afford their homes. Their term for this mock the other team and still pull off the has been before. I can understand this is “predatory lending.” win! Amazing, right? I remember watching frustration. For the past thirty years the them on ABC’s Wide World of Sports higher-ups in government – you know, the If you can see a bit of contradiction and with my friends; laughing hysterically at people who are so smart that they tell us hypocrisy in this, well, welcome to the real their antics. Meadowlark Lemon would how to live our lives, but actually do not world. pull pranks on the referee while Curly live by the same rules that they impose on Neal would dribble the ball endlessly us – have claimed that home ownership is So, it appears that the illusion of home without being touched. True Masters. the dream and right of every American… ownership is not what it used to be; that On many occasions I would find myself or for that matter anyone who happens to the dream is gone. nervous near the end of the game as the live in this country. Washington Generals would be making This really isn’t the case. Basically, we have their run. I would think that they would They wanted to make this a reality so been hit with a dose of reality. Whether have to win at least one game, they were badly that they created laws, guidelines and parameters that made it easy for almost anyone to get a mortgage and buy a home. • Debt ratios in order to determine if a borrower can pay back a loan – Ahh let’s expand those, or get rid of them altogether. • Verify someone’s income – Nuisance, don’t need it. • How about at least verify they have money for a down payment? – Get rid of that, too. • Before you ask, let’s just get rid of the down payment altogether. • Let’s just make this easy – Sign here please. These very same people who instituted these guidelines (you know, the ones who are smarter than everyone else) during this “heyday” of our industry would constantly harass large banks and mortgage companies for not lending The best there ever was? www.deanvlamis.com | www.perlmortgage.com
Dean Vlamis | 773.612.2666 page 2 due! But no, the Globetrotters found a way and well into my senior year in college I There are also those naysayers, the spoilers. to win and remain undefeated. proudly and stubbornly sported this look. The young kids in 1st grade who claim (This one was a tough one to learn.) there was no Santa Claus. The NBA; who needed that when the Globetrotter’s were the best team in the Some people (me) just learn things the hard Even today we have people claiming that world? way. Bono from U2 sported the ponytail professional wrestling is fake. Now, I used look in the late 80’s. So I was about ten to go to these events for years, and when Do you remember Flipper the dolphin? years late on this, I though it looked good! you have seen Andre the Giant body slam The greatest shark killer of all! For that But hey, I started the new decade up on someone then you will know this is legit. matter, all dolphins can kill all sharks and things. dolphins were as smart as people!!! So, has the illusion of home ownership been shattered? Not at all; in today’s world, We all liked fast cars when we were younger if you are looking to borrow money for a and no one was faster than Speed Racer’s home the bank simply wants you to prove Mach 5. But in reality we all found Speed a you have the ability to pay it back. You bit whiney and annoying to say the least. have to keep in mind that the banks are getting scrutinized by those very smart But back to fast cars. Since Speed Racer people who refuse to live by the standards was a cartoon we knew it wasn’t real. But imposed on the real world, and trying Herbie the Love Bug from the Disney to satisfy them is often a double edged movies was a real car, a Volkswagen Beetle, It was tough giving this up. sword. Therefore, moving forward, they and in Herbie Rides Again he annihilated are scrutinizing everything so that all loans in their portfolio can be accounted for. The good thing is that interest rates are still near historic lows, so you may have to go through a process where full disclosure is required, but in the long run you will be saving a lot of money. So, is it harder to get a mortgage these days than to get a girlfriend as a freshman in high school? It depends. In high school, you could always use the excuse that your girlfriend “lives in Wisconsin,” you know, just to save face. (Honest, I never claimed this!) But yes, that was another shattered illusion as I entered my teen years… No car was faster! the competition and in our minds was the fastest car on the street. So in everyday life whenever we would see a Beetle on the street, we were in awe at its mighty potential. When the sitcom Happy Days hit the airwaves, there was no one cooler than Fonzie. (The rumor that I had my Fonzie poster well into high school is simply not true!) Back in 4th grade we all believed that he did indeed have over 100 girlfriends as he claimed. What hurt so much about this is that I truly believed this was normal and that when my teen years were to come I too would easily achieve this feat. This “innocence” did not just happen in my youth. I was convinced back in the day that the mullet haircut was here to stay, So I was a bit late to this one. www.deanvlamis.com | www.perlmortgage.com Illinois Residential Mortgage Licensee MB0004358 and Equal Housing Lender. Licensed by Department of Corporations under the California Residential Mortgage Lending Act. NMLS #19186, 194442 (IL, MI, WI), 31.0007455 (IL), 16882 (IN).

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Mar 2012 Dean Vlamis Newsletter

  • 1. deanvlamis MARKET NEWS 2936 W. Belmont Avenue Chicago 60618 773.612.2666 | dean@perlmortgage.com www.deanvlamis.com True or false: it is harder to get a mortgage enough. In fact, big banks like Chase and reality is good or not is a different issue. today than it is to actually get a girlfriend CitiMortgage were sued by the Federal Sometimes it is good to live in your as a freshman in high school. (Answer government for not “lending enough” in illusions or innocence. Facing reality can later.) certain areas. be a tough thing. This is actually a legitimate question, and Now of course these same intellectual Here we go… from my end I hear a lot of frustration elitists, who refuse to live by the same rules from clients going through the process. that they impose on us, are demonizing and The Harlem Globetrotters come to mind. Yes, it is much more difficult to get a actually suing banks, mortgage companies As a child we used to adore them and were loan these days, and requires a lot more and lenders for their reckless and unethical amazed at their incredible talent. I mean, documentation. On top of this, everything practices of lending to people who could they could play a ball game, goof around, in the file is scrutinized like it never not afford their homes. Their term for this mock the other team and still pull off the has been before. I can understand this is “predatory lending.” win! Amazing, right? I remember watching frustration. For the past thirty years the them on ABC’s Wide World of Sports higher-ups in government – you know, the If you can see a bit of contradiction and with my friends; laughing hysterically at people who are so smart that they tell us hypocrisy in this, well, welcome to the real their antics. Meadowlark Lemon would how to live our lives, but actually do not world. pull pranks on the referee while Curly live by the same rules that they impose on Neal would dribble the ball endlessly us – have claimed that home ownership is So, it appears that the illusion of home without being touched. True Masters. the dream and right of every American… ownership is not what it used to be; that On many occasions I would find myself or for that matter anyone who happens to the dream is gone. nervous near the end of the game as the live in this country. Washington Generals would be making This really isn’t the case. Basically, we have their run. I would think that they would They wanted to make this a reality so been hit with a dose of reality. Whether have to win at least one game, they were badly that they created laws, guidelines and parameters that made it easy for almost anyone to get a mortgage and buy a home. • Debt ratios in order to determine if a borrower can pay back a loan – Ahh let’s expand those, or get rid of them altogether. • Verify someone’s income – Nuisance, don’t need it. • How about at least verify they have money for a down payment? – Get rid of that, too. • Before you ask, let’s just get rid of the down payment altogether. • Let’s just make this easy – Sign here please. These very same people who instituted these guidelines (you know, the ones who are smarter than everyone else) during this “heyday” of our industry would constantly harass large banks and mortgage companies for not lending The best there ever was? www.deanvlamis.com | www.perlmortgage.com
  • 2. Dean Vlamis | 773.612.2666 page 2 due! But no, the Globetrotters found a way and well into my senior year in college I There are also those naysayers, the spoilers. to win and remain undefeated. proudly and stubbornly sported this look. The young kids in 1st grade who claim (This one was a tough one to learn.) there was no Santa Claus. The NBA; who needed that when the Globetrotter’s were the best team in the Some people (me) just learn things the hard Even today we have people claiming that world? way. Bono from U2 sported the ponytail professional wrestling is fake. Now, I used look in the late 80’s. So I was about ten to go to these events for years, and when Do you remember Flipper the dolphin? years late on this, I though it looked good! you have seen Andre the Giant body slam The greatest shark killer of all! For that But hey, I started the new decade up on someone then you will know this is legit. matter, all dolphins can kill all sharks and things. dolphins were as smart as people!!! So, has the illusion of home ownership been shattered? Not at all; in today’s world, We all liked fast cars when we were younger if you are looking to borrow money for a and no one was faster than Speed Racer’s home the bank simply wants you to prove Mach 5. But in reality we all found Speed a you have the ability to pay it back. You bit whiney and annoying to say the least. have to keep in mind that the banks are getting scrutinized by those very smart But back to fast cars. Since Speed Racer people who refuse to live by the standards was a cartoon we knew it wasn’t real. But imposed on the real world, and trying Herbie the Love Bug from the Disney to satisfy them is often a double edged movies was a real car, a Volkswagen Beetle, It was tough giving this up. sword. Therefore, moving forward, they and in Herbie Rides Again he annihilated are scrutinizing everything so that all loans in their portfolio can be accounted for. The good thing is that interest rates are still near historic lows, so you may have to go through a process where full disclosure is required, but in the long run you will be saving a lot of money. So, is it harder to get a mortgage these days than to get a girlfriend as a freshman in high school? It depends. In high school, you could always use the excuse that your girlfriend “lives in Wisconsin,” you know, just to save face. (Honest, I never claimed this!) But yes, that was another shattered illusion as I entered my teen years… No car was faster! the competition and in our minds was the fastest car on the street. So in everyday life whenever we would see a Beetle on the street, we were in awe at its mighty potential. When the sitcom Happy Days hit the airwaves, there was no one cooler than Fonzie. (The rumor that I had my Fonzie poster well into high school is simply not true!) Back in 4th grade we all believed that he did indeed have over 100 girlfriends as he claimed. What hurt so much about this is that I truly believed this was normal and that when my teen years were to come I too would easily achieve this feat. This “innocence” did not just happen in my youth. I was convinced back in the day that the mullet haircut was here to stay, So I was a bit late to this one. www.deanvlamis.com | www.perlmortgage.com Illinois Residential Mortgage Licensee MB0004358 and Equal Housing Lender. Licensed by Department of Corporations under the California Residential Mortgage Lending Act. NMLS #19186, 194442 (IL, MI, WI), 31.0007455 (IL), 16882 (IN).