Thanksgiving is a holiday which centers around re-uniting with family and friends, and giving thanks for all your many blessings. I hope all of my friends out there have a fantastic Thanksgiving holiday, and create some wonderful new memories. May the Lions win the game today, but if not, may everyone have a great time anyway! Happy Thanksgiving!
If you have ever wondered where your equity went in your home, the answers lie in a book written by Michael Lewis entitled ‘The Big Short: Inside the Doomsday Machine’.
Sparked by policies created during the Clinton administration in the White House, when the sub-prime loan was introduced to loan money to the poor for housing, this type of lending was exposed in as early as 1997 and several companies engaging in these practices went bankrupt at that time. However, the model was continued and used as an instrument that evolved into what amounts to a massive Ponzi scheme of the mortgage industry that lasted over a decade, and ultimately crashed the economy.
This book is very enlightening, and is well worth the read. In March of 2010, when the book was released, the New York Times had this to say about it: “When the crash of the U. S. stock market became public knowledge in the fall of 2008, it was already old news.
The real crash, the silent crash, had taken place over the previous year, in bizarre feeder markets where the sun doesn’t shine, and the SEC doesn’t dare, or bother, to tread: the bond and real estate derivative markets where geeks invent impenetrable securities to profit from the misery of lower- and middle-class Americans who can’t pay their debts. The smart people who understood what was or might be happening were paralyzed by hope and fear; in any case, they weren’t talking.”
Buying a house is easy in Battle Creek, Michigan. Many first time home buyers come to
me with the look of utter uncertainty about how they would ever go about it. Becoming a home owner seems to consist of so many unknowns, that they do not know where to begin.
A recent example of a young lady that contacted me through my website at: www.michaeldelaware.com was of the same idea. She filled out one of my information forms on the website, and forwarded it to me. I received it and called her within a half hour of her having sent it to me. After a short conversation with me, she soon began to believe that buying a house is easy in Battle Creek, Michigan.
Here is the timeline on how I worked with her to make her see that buying a house is easy in Battle Creek. She contacted me through the website on August 20th, I called her. I connected her up with a local lender, after assessing her needs. She was pre-approved for a loan by August 23rd, and we went looking for homes.
We wrote a total of three separate offers, and were not successful on the first two, but the third we were successful. We just got the home completed and under contract on September 5th, and she will likely close on the loan and be able to move in sometime between the end of September and mid October.
As a Realtor, I not only helped her see that buying a house is easy in Battle Creek, Michigan, but she also is realizing that it does not have to take a long time to find the perfect house for her and her family!
So, it is true that buying a house is easy in Battle Creek, Michigan, and as a local Realtor, I would like to offer my services to you and your family too. Just take a minute to visit my website: www.michaeldelaware.com and see for yourself.
A week ago I went out to the Forst Custer Recreation area and did some hiking to get a little exercise. The leaves are beginning to turn color, and there are many colors to enjoy wherever you walk.
The trails are of all types of grades, and many people go mountain biking there, as well as running in addition to hiking. The entrance to the Fort Custer Recreation area is off of Dickman Road, just over the Kalamazoo County line before you arrive at Augusta, Michigan.
Getting ready for the Thanksgiving holiday in Southwest Michigan should always include at least one November visit to Turkeyville just outside of Marshall, Michigan. The Turkeyville farm is a facility perfect for families with children, as they get to experience hay rides, pumpkin picking, pet some farm animals, have ice cream and even see some real turkeys!
As one of the local attractions in the area for family members, Turkeyville is always one I try to mention this time of the year as many people moving into the area do not know about it right away. Turkeyville even has family theatre where they serve dinner on certain days of the week, as well as outdoor festivals on weekends during the spring, summer and fall. There is always something happening at Turkeyville, but the autumn is one of the best time to go visit.
If you like eating Turkey, their restaurant has a wide selection of turkey dishes and other great foods. It is perfect for lunch, or dinner. They even are open for turkey dinner on Thanskgiving, so you do not have to cook if you do not want to. All in all, Turkeyville is a fun place to go for an excursion, and you will always find something fun to do there as a getaway.
Cornwell’s Turkeyville Farm and Restaurant is the official name of the facility, and it is located at the corner of N Drive and 15 ½ Mile Rd, about a mile from I-69 off Exit 42. It has an interesting history. Originally a farm held by the Hawkins family, established in 1836, Asahel Hawkins who had emigrated from Vermont, began with 80 acres of government land and eventually increased his holdings to 240 acres.
After his death in 1881, his son Asahel Myron Hawkins took over the farmstead. He grew
a variety of crops, and held several Convis township civic offices including supervisor, clerk, highway commissioner and justice of the peace. His son Schubail Hawkins ran the farm until 1933. In 1942 the farm was converted to Turkey production and in 1968 the Fourth, Fifth and Sixth Generations of Asahel Hawkins opened a restaurant. Today, Cornwell’s Turkeyville Farm and Restaurant still raises live turkeys, and has expanded the facility to include many other attractions as you can see here. A great place to visit!
The impact of rising student loans on the new home buyer market has grown to be a huge
issue, particularly with the rising rate of default. Student loans which are federal government loans do not fall off a credit report. The debt cannot be settles in bankruptcy, and will follow you until you pay or die. Because of this, the education system in the U.S. today has grown to become a prosperous venture for colleges. Students can receive government loans, the school gets paid, and they do not have to deal with collections. The students then are burdened with paying back the loan, regardless if the education they gained launched them into a career that enabled them to pay back the debt or not.
I am somewhat critical of this system, as I have seen too many young people walk into the trap. The old adage of ‘Go to school, earn a degree, get a better job because of that degree, etc.’ was what used to be true for our parents. Today, so many of the college and university students obtain a degree or diploma at huge expense, and the education is meaningless to employers and offers the student no long term benefit, much less a career in the field they hoped to go into.
The sales pitch to ‘go to college’ and ‘get a degree’ starts in elementary school and high school. Even recently the schools have been pitching people in the workforce to return to college to ‘earn a degree’ leading these prospective students to believe that the degree is going to enable them to achieve higher earnings in the outcome. It becomes a fool’s game if you have no real direction.
According to a recent article written by a USA Today writer, the total sum of annual student loans taken out last year was $100 Billion dollars. Outstanding student loans will cross the $1 Trillion mark later this year for the first time in history. The amount of students in default of over 9 months on their student loans rose from 6.7% in 2007 to 8.8% in 2009 according to the most recent federal data.
Over 300,000 students across the country are in default according to this article, and that number is rising. What does this say about the education system? Are they really getting the product of an educated student that has value to the society? Is the education they are selling these students of any value? These are all important questions to ask, considering the government loans are provided with tax payer dollars, and there is little or no accountability for the colleges required in this program. Nor does there appear to be any limit to what a college can charge for their programs.
Universities and Community colleges across the country seem to have no shortage of funds to expand their buildings, and their campuses. Not that this is a bad thing for a community, but if the student is not getting that promised career based on the education provided, it has a greater impact on the future of our country.
If I were to offer advice to a student considering going to college, here are a few common sense ideas I would suggest:
1) Do not go to college to ‘find out what you want to do’. That is like going to a clothing store with an open-ended credit card and buying everything in the store to see if you like it, regardless of size, color or usefulness. You will run up a huge tab quickly with no return. Go to college with a plan for a specific career as the outcome, or do not go until you have this plan.
2) Choose a degree program that offers a career in a proven profession that is always in high demand in society, regardless of economic condition. Examples of this might be a medical doctor, attorney, an engineer or an accountant. These professions are just some examples of ones that seem to endure, as well as offer remuneration and employment which will enable you to pay back the money you borrowed for the education in the first five to seven years working in the field.
3) If the cost of the education is going to be more than 1/3rd of the annual income expected from the median annual salary of that profession over a 5 year period, then you will be underwater with choosing that degree program and it will not be sustainable. I would recommend choosing another field or method to obtain the education you will need to work in that profession.
4) Be practical in your approach. Is the training or degree in high demand? Are people who have completed the training or degree finding immediate employment? Do not ask the college who is selling you this program. Ask people actually practicing in the profession. You might even consider approaching a company that hires people with that training and talk to their personnel department. Even see if you can make contacts within, giving you a place to go to once you have finished your training.
5) Do not buy into new things untried or unproven as of yet, especially if the training required takes four years to complete. Example: A caller once called a radio talk show I was listening to that embarked on a four year degree program in ‘Green Energy Conservation’ because he listened to a politician that said this was the ‘wave of the future’ in 2006. When he completed his degree, he could find no employment and is now bagging groceries trying to pay for a $50,000+ student loan. A sad tale resulting from a poor choice of a yet unproven, untested career.
I am writing this article because often as a Realtor I sit down with some young person who
wants to buy a house, and when they meet with a lender they are denied because of a default on a student loan, or their income ratios are out of whack because of huge student loan debt. Or I meet with someone who is not in default, but is struggling to make ends meet in a job that is radically different from the degree they paid for, and career they hoped to have now. So an ambitious person seeking higher education in the modern day needs to consider a more practical approach before signing or committing to a long term student loan that will follow them for years to come.
Colleges and universities are businesses, and they will sell you a program if you reach for it. The government backed student loan programs make it easy for them to do this. An approach to obtaining an education with a proven plan is the best way to avoid being an economic slave to a government loan program.
Home inspections are an important part of the home buying process. When a new
homeowner is looking to buy a home, and has an accepted offer on a home, there is usually an inspection period worked into the contract.
This inspection period in Michigan is usually 10 days, but can vary in time range depending on what is negotiated into the contract.
Working with a Realtor that can help guide you through this process is important. Some of the essential home inspections you might want to consider is:
1) A general overall inspection which covers structural, mechanical, electrical and plumbing. These are the services general home inspectors usually cover.
2) A pest inspecton for wood destroying insects. This inspection will reveal if there are termites, carpenter ants, etc. infesting the home.
3) A well and septic inspection. If the home is on a well or septic or both, you will want to have the systems inspected to verify they are in working order and the well water is free of contaminates.
4) A radon inspection. Radon gas is an invisible gas that long term exposure can cause severe health problems.
5) Other specialty inspections for individual items in the home, such as the roof, mechanicals, swimming pool, etc.
Home inspections are an important part of the process of homebuying, and can reveal a great deal of information about the home. Usually a home inspection offers a thorough orientation to the condition of the home for a buyer, but in some cases can reveal hidden defects which might need to be resolved in the contract negotiations before closing. So it is always a good idea to arrange for these to be done.
I still find myself taking photos of the fall colors currently on display in Southwest Michigan right now. They will not be here for too much longer, so I thought I would share a new photo I took at Bailey Park in Battle Creek, Michigan this past weekend.
Selling your home in Michigan today can require some adjustment in thinking. In previous years when one bought a home, they improved the home in the time they lived there, real
estate values increased year to year, and when it came time to sell, there was a profit. Additionally the home sold in a relatively short marketing time, and one moved on with a down payment for their next home, wherever that may be.
Today, in Michigan, when real estate values have fallen consistently for over a 5 year period or more to a drop of over 40% in some areas, this changes the playing field dramatically. Selling a home becomes an entirely different game, and requires a different mindset. If you need to sell for relocation purposes, then you need to sell, period. To sell quickly, one may need to confront the harsh reality that there most likely will be no profit in the sale. Additionally, you might be bringing money to the table. Scary, but true.
Many homeowners who cannot bring money to the table, and cannot sell, are faced with essentially three undesirable options.
1) Do not sell, and wait a few more years and see if the market returns where you can sell
and break even or make a little return on your investment.
2) Sell your home as a short sale, and hope your lender will accept a shorter payoff of your mortgage so you can settle this debt and move on. This can damage your credit, but might be an option if you can endure the long timelines associated with approval on this process.
3) Walk away and let your home go into foreclosure. This will leave a damaging mark on your credit for over seven years, and place you in a position where you are not likely to qualify for a mortgage again for several years into the future. Even then, your next mortgage years down the road may have a much higher interest rate due to this mark.
These unfortunately are the cold hard facts of the Michigan marketplace right now. The price of your home is the driving index as buyers compare your home with others. Improvements have some value, but spending large sums on improvements will often never return any additional sales value. Improvements for a home should be regarded as for your enjoyment only while you live there, and not as a potential additional return on the homes value.
Defaulting on a Federal Student loan can scar your credit, which can impact your ability to borrow money again in the future. Many students do not realize that when they sign up for a Federal Student loan, it does not leave their credit report until it is paid. Federal Student Loans are immune to bankruptcy proceedings, so even if you declare bankruptcy, the loan remains on your credit bureaus.
It is important for young people to know this information, so I have taken time to write a lot about it recently. I am of the personal opinion that one should never sign up for a Federal Student loan unless they are going to recieve an marketable skill in society after graduation with their degree. Persuing a degree that is obscure or narrow in demand in the market place is too risky an endeavor to incur a sizeable student loan.
One should only, in my opinion, utilize a the Federal Student Loan program if the career one is going into is in high demand and pays well, and offers one readily marketable employment right after graduation. Examples of such careers might be a Medical Doctor, Lawyer, Accountant or Engineer.
Taking on a four year program for a degree in ‘Green Energy Conservation’ as an example
may sound good on paper, but despite the rheteric in the media, it is not a wide open and high demand field providing immediate employment for those with such a degree.
One could probably list many degrees some students end up pursuing in this category, such as ‘Eastern Philosophy’ and ‘Political Science’. Unless you have gauranteed employment upon graduation, it is not advisable to roll up a high dollar student loan debt on an obscure career choice.
When one is attempting to buy a home in later years, your unpaid or negative marks from a defaulted student loan can damage your credit scores and place this out of reach. Too many times I run into young people in their mid 20′s who have $50,000+ in Federal Student loan debt that is eating up all their monthly earnings, and usually they are in a job that has no relation to the degree or education they obtained in school.
This is a sad future for millions of American students, and it wise to step back and let your practical side of the decision guide you. Follow this basic rule: Pursue an education that is going to offer you a readily marketable skill immediately upon graduation, and one that will give you a large enough salary even at an entry level position to pay back the loan within 5 years, and you will do well.