The Lyons Den

First things first, do a Financial Statement / Budget Worksheet (see attached or call your lender’s loss mitigation / loan modification department and request their loan modification package.) You are going to want to fill this out so you can calculate your DTI now. This will save you a lot of time up front and will enable you to make a decision as to whether you should do a short sale or attempt to do a loan modification. If you get denied you can always do a short sale as your backup plan to prevent foreclosure.

You want to make sure your DTI is not too high or not too low but, just right. Banks ideally want everyone to be at 32%. If you are already close or less than that they most likely won’t do anything. If you are way too high 70%+ then they most likely won’t do anything because they will think you’re a lost cause.

Housing Ratio or Front End DTI is mortgage payments, taxes, insurance, mortgage insurance, and HOA.

So on the attached example:

$2,645.49(1st)+$500(taxes)+$873.24(2nd)+$50(insurance)=$4,068.73

Divide the $4,068.73 into your gross income. i.e. $4,134.30 / $8,076.94 equals a 50% housing ratio or front end DTI. (Which is perfect!) We want it to be between 50-70% now and end up at 32-40% after the modification.

Then take all your other expenses it is asking for. i.e. gas/elect, car, child care, gas, food, etc. and add that to the housing expenses. You will then get your backend DTI.

For example $4,068.73+$2,372.29(other exp)=$6,441.02 divided into gross of $8,076.94 = 79% DTI

So in this example your DTI would be 50/79 (50 over 79) (50 front end and 79% back end or total DTI)

It is always a good idea to do everything off of gross income as well as net income (take home). When you illustrate both out on the financial worksheet it leaves little guesswork by the bank and makes things a little clearer. 100% Backend DTI based on NET Income shows that you have no disposable income and something must change.

DTI Summary:

If your housing ratio is already at 40% or less your lender will most likely say “sorry this is not our problem…the problem is because of your rental properties, your credit cards etc.” Solution = Short Sale Rental Properties and look into Debt Management Options for the unsecured debt. If those are not an option look into CH. 7 Bankruptcy.

If your housing ratio is 70%+ then they are most likely going to say “you are in a house you can’t afford and we need to get you out of the McMansion and into something that you can afford.” Solution = Short Sale Property and look into Debt Management Options for the unsecured debt. If those are not an option look into CH. 7 Bankruptcy.

If you are in an option arm aka negative amortization loan, the lender most likely cannot and will not give you a 1% modification. If the lender were to grant a modification for a fixed rate of 5-6% see if your housing ratio would stay under 40%. You can calculate your new payment here. If you can’t even afford the payment at 1% or if you will not be able to afford the higher fixed rate. You either abused the product or got slammed into it. Solution = Stay in the home and continue to make payments. 3-6 months before the loan recasts list your home for sale with a short sale expert and look into Debt Management Options for the unsecured debt.

By the way, another way you can lower your payment is to lower your property taxes. Here is the link to apply for a reassessment in San Diego. Don’t pay anyone for this service just find your counties property tax website online through a Google search and DIY.

#2 LTV (Loan-to-Value)

OK if you passed the first test in qualification move on to the second test, LTV. Does the lender have any collateral left? In other words, are you upside down? While this is not the most important qualification it is important to see if the lender has more incentive to foreclose on you or keep you on the hamster-wheel. Zillow seems to be pretty accurate lately to check your value.

If you want to get really analytical you can calculate what the lenders losses will be and illustrate to them that giving you a modification or approving you for a short sale will save them X.

#3 Adjustable Rate or a Fixed Rate Higher than 7%

We all know that we are going to have to pay back China someday and to do so we are going to have to hike interest rates. I hope you got a chance to read The Wall Street Journal’s article titled: “Official Sees Aggressive Rate Boosts in the Offing” In my opinion rates are going to go up quick especially if we come close to defaulting on one of our interest payments.

#4 Hardship

It is not necessary to go late on your payments in order to obtain a loan modification. If you are late it does however prove your hardship. Hardships can be any or all of the following: family emergency (medical, divorce, death, tragedy), increase in expenses (child, economy, etc) and/or decrease in income (layoff, loss of job, loss of overtime, loss of tips, economy). I recommend putting your outcome in your hardship letter so it is clear as to what will work for you.

We are all meant to grow, when we feel as though we are in limbo we can get stressed. We don’t sleep until we experience enough pain or enough pleasure to take action and do something about it. Like the old story about Cecil. Cecil was a hound-dog that laid down on the porch of a gas station in a small town in Texas, passer-byers would ask “why is Cecil always howling” and the gas station attendant would always reply, in his Texas accent “well, ya know, Cecil’s like most Americans, he sitting on a nail and too lazy to get up.” Knowing the next step in your life gives you that growth and freedom. If you are late one thing that helps is knowing your timeline. Most American’s believe if they are one month late the sheriff going to knock on the door the next day.

I hope this post helps educate you on the options that are available to you.

WARNING: Do not pay an upfront fee to loan modification SCAM. You can do it yourself for FREE!

This post has been dedicated to all of the loan mod scams out there and to putting you out of business for good!

How to Use a Short Sale to Prevent Foreclosure

thelyonsden — Thu, 24 Sep 2009 19:20:24 +0000

Here is a book I found today on Short Sales. I am sure it will be a good educational read. If you are going to do a short sale I recommend you get as educated as possible and utilize a true expert/professional. Why? – Because it is free to you! The bank pays your agents commissions!

According to Wikipedia a short sale is defined as the following:

“A short sale is a sale of real estate in which the proceeds from the sale fall short of the balance owed on a loan secured by the property sold.”

No Easy Way Out

thelyonsden — Sat, 19 Sep 2009 21:06:26 +0000

I love Doctor Housing bubble! The data he compiles is great!

-$1 Trillion in CA mortgages are underwater & swimming in the Pacific Ocean.

-42% have Negative Equity.

-$3Trillion total in US

-$1Trillion in Alt-A (Interest Only etc.)

-$182Billion in Option Arms

*50%+ are in Cali

*$20Billion~ BOA (CW)

*$42Billion~ Wells (World)

*$40Billion~ Chase (WAMU)

Short Sale a home you can’t afford and buy one for a deal that you can afford

Even though there were mortgage brokers that sold the option arm correctly by providing the proper education and disclosures most borrowers abused the product and did not save or invest the difference. If you haven’t been doing this start doing it NOW so you are prepared for your recast and if you can’t, get ahead of the game and do a short sale now.

While 88% have not yet recasted most borrowers are enjoying a 1% payment and a current interest rate of around 4%~ most commonly (MTA+Margin) or (LIBOR+Margin) Margin is fixed and usually ranges between 2-4%. (Review your loan docs or mortgage statement to obtain this information)

The problem lies when the option arm recasts and homeowners no longer have the OPTION of the minimum payment.

Well, I guess that wont be that big of a deal if the payment quadruples to 4%, right? 4% is a pretty low interest rate!

Oh, but wait! What about China? One would have to believe they want to start getting paid back their money by 2012, 2013 and that the LIBOR followed by the MTA will hit at least 4%.

Meaning (4%MTA+3%Margin) =7% septuple - octuple the payment!

Here is the ALT-A recasting schedule:

2009-2010 $6 Billion~/mo

2010-2011 $8 Billion~/mo

2011 $33 Billion~ /mo

“There’s No Easy Way Out There’s No Short Cut Home…”

…only a short sale

or will Lex Luthor – The Great Evil Mastermind of our time, be right?

Will someone nuke the San Andreas fault or will we have a big earthquake making California fall into the sea suddenly creating valuable beach-front property of the once barren desert? [shouting] ”Miss Teschmaacher”

I don’t know which chart below is more scary…either way we are going to need superman

Bruce Lee

thelyonsden — Wed, 19 Aug 2009 20:01:07 +0000

Bruce’s philosophy I believe would say something like this…

@bill_lyons Defeating an opponent is not fighting fire w/ fire, it’s harnessing, utilizing, deflecting and transfering their energy into your power10:20 PM Aug 10th from Twitterrific

Accidental Billionaires (Facebook Story)

thelyonsden — Tue, 11 Aug 2009 19:54:01 +0000

What a great book! Ben even gave a shout out to me on twitter!

benmezrich@bill_lyons I love that picture. Thanks! hope my book went well with the beer. I used to write while drinking Red Stripe. Now it’s Red Bull.10:13 AM Aug 10th from web in reply to bill_lyons

Having a landshark Jimmy buffet beer while reading @benmezrich http://twitpic.com/dbfth2:09 PM Aug 9th from Twitterrific

@benmezrich just picked up accidental billionaires. Look fwd to the read! I loved rigged!4:04 PM Aug 8th from Twitterrific in reply to benmezric

Doing Business in Today’s Economy

thelyonsden — Sat, 08 Aug 2009 19:46:23 +0000

Out of the who, what, when, where, why & how of business…

WHO you do business with in this economy is THE most important!

Intellichoice

thelyonsden — Sat, 01 Aug 2009 19:32:12 +0000

Before you get preyed upon for a loan modification by a Mantis aka Intellichoice, Intellichoice Mortgage Services LLC, Intellichoice Realty Services Inc and/or any other names or fictitious names make sure you read this desist and refrain order from the California Department Of Real Estate mentioning Intellichoice, Dieter Gable, Steve Walker and Shannon Bard.

Do an internet search and look at their customer reviews and complaints.

Type in “intellichoice loan modification scam” to google before you do business with them and see what happens

Especially look at Intellichoice’s F Rating on their BBB report that contains 36 complaints (and counting) over the past 12 months – all in regards to their loan modification operation.

Homeowner Beware!

Bill Lyons Interviews Jordan Adler

thelyonsden — Mon, 06 Jul 2009 16:19:32 +0000

I interviewed best selling author & entrepreneur Jordan Adler on a “new divide” between Sedona and Flagstaff Arizona. We talk about overcoming challenges, razor sharp focus, The Go-Giver, leaders deal with adversity differently, beach money, and send out cards. Jordan is wearing his alien transformer sunglasses. His EtchASketch analogy is true stoicism.

EtchASketch

Everytime I get the opportunity to spend time with Jordan it proves to be very valuable. When you are around him your mind opens and you become a limitless thinker.

Tony Robbins talks about how one action or one magic moment can create a processional effect like a stone that is dropped in a pond. Tony best describes this example with the story of Chris Hendrickson. “And then the story doesn’t end there…” It is a perfect example about how one thing or event can be created or gifted and attract amazing things that keep leading to more amazing things – All changing the course of time forever like the movie “Sliding Doors” or “Mr. Destiny.” Over the fourth of July weekend I can count at least three times where we just happened to run into someone because of something good being given out to the universe. These encountered weren’t happenstance or coincidence they were created and attracted.

Next interview I am going to discuss the above along with who Jordan’s 3 most influential mentors are and the 3 most influential events that had the biggest shift.

Send a card out in the mail to someone you love today, on me. Tell them how much you appreciate them and include a fun/cool picture of you so it makes them smile.

What if?

Karma and The Truth

thelyonsden — Sun, 19 Apr 2009 19:14:15 +0000

They say if you are going to have a blog you better have a good one. So far, this blog hasn’t been very good! I mostly have been using twitter. If you’d like you can follow me here or here.

Almost anybody can write anything about anybody online these days and unfortunately Quint Cobb has written something bad about me (Bill Lyons) .

I just wanted to ignore it but it is now starting to affect my business and my livelihood. I am losing business and everytime a client does a search on me it shows up! So what should I do? Should I tell the truth about who Quint Cobb really is or should I just create more positive energy?

I actually think it is quite funny and I never knew that I was only 5′6″! ha! Someone actually took the time to do a rebuttal on their and I really appreciate the kind words:

“This is a blatant LIE! Bill Lyons is a wonderful person to work for

After reading that load of crap I felt compelled to respond. That was the most ridiculous twisting of facts I have ever heard in my life. I worked for Bill for many years, and let me tell you that his employees’ success was always his number one goal. He gave people coming out of minimum wage jobs the opportunity to make $10,000; $20,000 even as much as $50,000 a month. He took his loan officers on trips to the Phoenician in Scottsdale and had weekend long Christmas parties in Palm Springs where he showered his employees with awards, praise, gratitude and encouragement for the year ahead. I doubt that the greedy person described above would spend all that money showing his employees his appreciation.

It was not Bill who was greedy, but his loan officers. Thinking they could do it better themselves, a group of money hungry, ungrateful liars betrayed and stole from Bill, and they were the ones to sneak out in the middle of the night. Unfortunately for them, they didn’t realize what they were leaving behind and I think that most of them are back parking cars while Bill continues to provide opportunity, even in this tough market.

Bill has always operated his business with the utmost integrity. That’s just his approach to business as well as to life. It’s who he is. Trust and honesty are two of his top values.

I happen to know that Bill and Judy Dunham are still friends. After he left American Mortgage Express to start LEI, he squared everything away with her and paid her every penny he owed her. I’m sure if you asked her, she would only have good things to say about him. In fact, if you ask around the mortgage and real estate industry, you will find that everyone has wonderful things to say about Bill. He is very highly respected by many of the top people in the industry.

Bill is a brilliant businessman and entrepreneur. He has an amazing energy that makes his company a fun place to work. He is extremely generous and if an employee, family member, friend, or anyone ever comes to him for help, he doesn’t even have to think twice before pulling out his check book or doing whatever it takes to help them out. The guy would literally give you the shirt off his back.

I am so grateful for my time at LEI and Bill is by far the most amazing person I have ever worked for. I can’t wait to see what he does next and I know beyond a shadow of a doubt that whatever it is, success will always find him. Surely, he will create great things.

Unfortunately, often times bitterness and jealousy follow greatness. This report was posted by a bitter ex employee who can only deal with his own failure and bad choices by maliciously attacking Bill with blatant fabrications. It is true that Bill received 150k from a friend and employee as an investment, however that person did not write that report. He and Bill are still friends and he is being paid back. That report was written by a liar posing to be someone he is not. But when you put out negative things, that is what you will eventually get back. I hope Bill stays focused and clear and doesn’t allow these people to get him down. You can’t believe everything you read, and this is definitely one of those times.”

Someone else, even wrote a nice blog post about my story. While I could care less about what people think, I do care what my clients think, and I do care about the truth. While both posts/replys were not 100% accurate the original attack was 99% lies. Since Quint has fraudulently told his clients about his past I have decided to include the truth:

Quint Cobb’s REAL resume
Quint Cobb’s fraudulent resumes. (Can you believe that he actually tells people this and they believe him?)
Quint Cobb’s wonderful track record of happy clients (complaints)

I hope this doesn’t fuel the fire even more but the truth must be told. I am sure a few small minded, ungrateful disgrunteled people will write a few more lies but that is the risk I take for the truth. There are also a lot of great people out there whos lives we were able to make a positive impact on – Who were able to learn, grow and have great memories and magic moments.

Yes, we built one of the largest mortgage companies in San Diego and the country by helping thousands of homeowners with their financing and offering opportunity to well over 250 employees.

Yes, we had challenges that every company does. We listened, we learned, and we acted with integrity. No apologies, and I know I am a stronger, better person because of them. Am I saying I am perfect? NO! Did I make mistakes? YES!

The market crashed! We were unable to close $100million in loans because the lenders went out of business, we lost $2million and I reinvested ALL of my assets back into the company to the tune of $1million! I thought that was the “right thing to do.” So I ask anybody to look me in the eye and tell me that I didn’t do EVERYTHING in my power and that I didn’t sacrifice EVERYTHING and more! Would you have done the same or would you be on the beach sipping mai tais?

Does this sound familiar? This happened to many good people across the country.

There are others out there like Quint. ..

James Nave an x-con who stole our customer database. His entire business at Apollo Funding is to call our past clients and tell them lies about me and the company for self gain. They even made it on 3 on your side.

Tim Hutchinson at People’s First – I have never met the guy but he loves to talk s%it about me for some reason. I think he took on a few old disgruntled employees/bad apples. Well Karma always wins. Tim and his bad apples were recently featured on ABC’s 20/20

Let the past be the past! Let’s learn from it and move on! Are some people really that bored? We live in very different times now and it is time for everyone to help eachother and work together.

I hope that you can help me get some positive things about me to the top of the search engines so, if inclined, please leave a positive comment below.

I started/created LEI in order to offer opportunity, and make a positive change in others lives…and when the market crashed it became exactly the opposite of what I first intended – we saw peoples true colors. Scared people got scared, Evil people got evil (but still managed to be wolf in sheeps clothing), sociopaths became real, bad apples became rotten, good people became better people. It is my hope the good people will not let those times taint their overall experience but rather let it propel them onto their next successful endeavor.

I will eventually start something new and better. The right way – not relying on others (as we have recently done since then). It will be even more successful than before and we will not make the same mistakes. Everyone deserves to start over and sometimes in order to begin you must start over with nothing but your experience (not any accomplishments or lorals from the past.) I must get clear about my vision (razor sharp focus), eliminate all my baggage, and get 110% committed.

Yes, losing all of your life savings can take a toll on you – you can even become a negative/acidic person that you used to laugh at – not someone with limitless thinking and explosive energy!

In the meantime we are offering and coaching clients with their real estate and financial needs and still standing tall (not 5′6″) with integrity! We are a small group but we help others and make a living. When the timing is right we will do big things again and I hope to see you there! “Success is not final, failure is not fatal; it is the courage to continue that counts.” -Winston Churchill

Thank You for your support!

Bill Lyons