Inman Blog

No More NetBank

GlennR — Fri, 28 Sep 2007 16:08:24 -0700

NetBank, an Internet bank based in Alpharetta, Ga., goes belly-up (see Inman News.)

From the Office of Thrift Supervision: "NetBank sustained significant losses in 2006 primarily due to early payment defaults on loans sold, weak underwriting, poor documentation, a lack of proper controls, and failed business strategies. As a result, the OTS executed a formal enforcement action with NetBank in 2006 directing the institution to correct its operating deficiencies and enhance its capital position. While the institution continued to operate in excess of minimum capital standards, the actions taken to address these problems were unsuccessful and it became clear that high operating expenses combined with continuing losses were jeopardizing the institution’s viability."

It is the second FDIC-insured bank to fail this year, and the first in Georgia to fail since AmTrade International Bank in Atlanta closed on Sept. 30, 2002, according to the FDIC. More details at this FDIC Web site.

Majoring in foreclosures

Matt_Carter — Wed, 26 Sep 2007 17:03:29 -0700

Got $375? "Dr. Dani" wants to teach you the ins and outs of foreclosures. While get rich foreclosure seminars are a dime a dozen, what's a little surprising about this one is who's offering it -- the University of California, Irvine Extension.

The six-week course is taught by Danielle Babb, whose latest book, "Finding Foreclosures," is required reading for the course (along with a subscription to RealtyTrac).

According to a press release from the university, the course is perfect for families whether they "simply want to move into a better neighborhood at the same price, or are looking to invest in a market known for being more stable than playing the stocks – buying in at today’s low foreclosure prices can be very lucrative and exciting.”

The class description says Babb is the author of four books, "focusing on the use of technology in various industries." One of those books is "Make Money Teaching Online: How to Land Your First Academic Job, Build Credibility, and Earn a Six-Figure Salary." According to her faculty bio at "American Sentinel University" -- one of those online schools presumably providing that six-figure salary -- Babb earned her PhD at Capella University, another virtual institution of higher learning.

Get a free taste of Dr. Dani's foreclosure wisdom at the blog she maintains with Finding Foreclosures co-author Bill Nazur.

Market claims NJ broker, Foxtons

Matt_Carter — Wed, 26 Sep 2007 17:37:20 -0700

Foxtons -- the London-based discount real estate brokerage that in a little more than seven years grew to 500 employees serving New Jersey, New York and Connecticut -- issued a press release late Wednesday saying it was laying off 350 of its 380 remaining employees and may file for bankruptcy protection.

A finalist for the 2007 Inman News Innovator Award, Foxtons blamed the decision on a "sharp decline" in the real estate market.

"Foxtons is well run, very efficient, has a great team and has pioneered a new model in the real estate business – a model which has proven itself and, we believe, will have lasting influence on our sector," John D. Blomquist, Foxtons’ senior vice president and general counsel, said in a statement.

Blomquist said Foxtons has "been battling against a real estate market that recently has turned into a sharp decline, and the company no longer has the liquidity to operate as a going concern.”

Foxtons said intends to "preserve the value" of its 4,400 current listings, while minimizing customer disruption and dedicating anticipated revenues to pay creditors.

We'll Miss You Bob

Luxury Clues — Wed, 26 Sep 2007 21:45:29 -0700

I first remember reading Bob Bruss back in the 1980's. Those of us who were agents read his weekly Sunday column with both dread and anticipation. Would this be the week that he said something that helped us with our business or would we be fielding even more objections because he said something contrary to what we believed to be true? Bob never had trouble throwing a curve ball at those of us who were brokers. As I look back at his amazing body of work, however, there is no doubt that he wanted only the best for the real estate consumer. His columns were always about how buyers and sellers could make the best decisions possible when it came to real estate.

I had the privilege of meeting Bob in person at the Inman conferences. He was a true gentleman in every respect. Bob also was extremely generous in terms of helping other writers. He regularly reviewed new real estate books, always with an eye for how the book would help the industry or the consumer.

I remember when I first started writing for Inman News and receiving a note from Bob telling me I had written the best real estate column ever. The column was about the worst experience I ever had with an escrow that included two foreclosure proceedings, tax liens, a short sale, coupled with the Malibu fire and the 1994 Northridge Quake. We closed the transaction by working hand in hand with the lender, the tax assessor, as well as the seller and buyers. To me, that's perhaps the greatest legacy that Bob leaves behind--a vision of a business where we work together to do what is in the best interest of the people we serve.

Bob, you served us well. May those of us left behind be worthy to pick up the mantle and follow in your footsteps.

Posted by Bernice Ross, www.RealEstateCoach.com

When I met Bob Bruss

Ilyce_Glink — Thu, 27 Sep 2007 06:42:35 -0700

When I heard the news yesterday about Bob, I found myself thinking back to when I first met him.

I was a young reporter, just starting out, writing freelance stories for the Chicago Tribune, Washington Post, and a bunch of the Crain's trade publications. Most of my stories were for the Chicago Tribune's real estate sections which, back in the late 1980s, were fat with ads and had editors scrambling for copy.

One of my colleagues there suggested I might want to join the National Association of Real Estate Editors, more commonly referred to as "NAREE," because it would help me meet other real estate writers (there weren't all that many of us back then), network with prospective sources, and learn about the business in general.

I can't remember where the first meeting was, or exactly when (sometime in the late 1980s), but I remember walking into a media room and meeting Bob Bruss. He was wearing a jacket with an open shirt, trousers and dressier shoes, which was standard dress for him.

He was a perfect gentleman then, and every time I saw him after that.

As my first book, 100 Questions Every First-Time Home Buyer Should Ask, was being published in 1994, Brad Inman invited me to join Bob on the stage at the Los Angeles Times Home Buyer and Seller Fair, and a similar one held in San Francisco.

Watching Bob on a stage in front of thousands of first-time home buyers was riveting. He was courteous to everyone, answered many questions and clearly had legions of fans. I learned so much from him at events like those, and NAREE events over the years. He was kind in his reviews of my books (I even got a 12 out of 10 on one or two titles), and my work in general.

And in turn, I continued to marvel that he could produce 7 solid columns each week, no matter what.

I last saw Bob at a cocktail party at the Palace Hotel at the most recent Inman Connect. Although he was walking slowly, recovering from a recent surgery, he insisted he was fine and would see me in New York.

Family was important to Bob and he frequently mentioned his family back home, particularly his niece and nephew. But to many real estate writers, Bob was part of a family of long-time real estate writers, a true leader of the pack. He brought warmth and familiarity to a trade organization, believed in being polite to everyone, helped countless home buyers, sellers, owners and investors, and was a gentleman to the end.

He will be sorely missed.

-- Ilyce Glink, ThinkGlink.com

Title exec likes wine and cheeseburgers

Matt_Carter — Thu, 27 Sep 2007 11:24:12 -0700

When the going gets tough in the title insurance industry, the tough ... diversify -- into vineyards and fast food.

Fidelity National Financial Chairman William P. Foley II -- who's recently been buying up vineyards around California -- has FNF maneuvering with some private-equity firms to buy the fast food chain Wendy's, the Wall Street Journal reports. The story notes that Foley used to be the chairman and CEO of the parent company of Carl's Jr. and Hardee's.

In FNF's last quarterly report to investors, the company said second quarter profits fell 36 percent, to $84.8 million, thanks to higher interest rates and a slowdown n mortgage lending and housing markets. The company is nonetheless on an acquisition kick that's included closing services provider ATM Holdings Inc. and Property Insight LLC, a company that manages and maintains FNF's title insurance plants.

Although a successful bid for Wendy's would give FNF a stake in the company, Foley's wine ventures are his own. He's the founder and managing partner of LinCourt Vineyards and Foley Estates Vineyard and Winery.

Downturn ad spending: Zig or zag?

Matt_Carter — Thu, 27 Sep 2007 13:20:17 -0700

With the latest numbers from HUD and the Census Bureau showing home sales continue to slow, will realtors, mortgage lenders and others in the industry reduce spending on online advertising and leads, or jack it up in a bid to claim a share of the dwindling number of buyers?

Joel Burslem has been following the issue for some time on Future of Real Estate Marketing. His last post on the topic rounds up several media reports suggesting that Internet ad spending will go down.

Others -- such as Eric Bader of MediaVest, quoted in a recent Financial Times article -- say online advertising will continue to grow as Web sites take market share from TV, newspapers and radio, where return on investment is harder to measure.

Another recent piece in SmartMoney, "Bankrate thrives in mortgage mayhem" notes the provider of mortgage and bank rates raised its hyperlink ad rates between 15 percent and 25 percent this summer. While mortgage accounted for a amaller percentage of total traffic to the company's site, "mortgage and refinance activity was still strong," the story said, while traffic to pages providing rates on deposits grew.

It would be interesting to hear from other Web destinations about what's happening to your real estate ad revenue.

Chuck Norris vs. Credit Crunch

GlennR — Thu, 27 Sep 2007 14:48:54 -0700

Bloomberg's Mark Gilbert considers the credit crunch and asks, "What would Chuck Norris do?"

Gilbert notes some popular sayings about actor and martial artist Chuck Norris, such as "Guns don't kill people, Chuck Norris Kills people" ... and adds a few more along the lines of the U.S. credit crisis.

He offers: "Here, then, is the world of money recast in Chuck Norris terms":

"Chuck Norris doesn't target inflation. He roundhouse-kicks it until it begs for mercy."
"The tears of Chuck Norris would supply enough liquidity to solve the credit crisis. Too bad he never cries."
"Chuck Norris doesn't borrow at the Fed's discount window. Chuck Norris LENDS at the Fed's discount window."
"Chuck Norris Asset Management made 50 percent on its subprime mortgage-backed bond fund last month."
"Chuck Norris has a trade surplus with China."

The list goes on, this is just a sampling.

Honoring Bob Bruss

Inman_News — Thu, 27 Sep 2007 14:52:35 -0700

Many readers, friends and colleagues have asked for details about a memorial service for Robert Bruss. A memorial service for family and friends will be held on Wednesday, October 3 at 6 p.m. at Crosby N. Gray & Co. in Burlingame, Calif.

In lieu of flowers, donations in Bruss' memory may be sent to: Edina Educational Fund, 5701 Normandale Road, Edina, MN 55424. More information about the Edina Educational Fund is at www.edinaedfund.com.

Truth and reconciliation

Matt_Carter — Wed, 26 Sep 2007 10:05:42 -0700

Channel surfing last night I stumbled on a LendingTree ad starring none other than the company's CEO, C.D. Davies. The gist of the spot was that it's a confusing time in the mortgage lending industry and that LendingTree is there to help you figure out your best options -- even if the best option is not to take out a loan right now.

A quick search at YouTube shows Davies is also the public face of a LendingTree Web video campaign. LendingTree has its own YouTube "channel" and Davies -- still in his rookie year as CEO after the unexpected resignation of Tom Reddin in May -- stars in seven shorts with titles like "What's going on in the mortgage industry?" and "Why are loans harder to get?" My personal favorite: "How do you refinance an ARM?" (above).

LendingTree's YouTube channel links to a "Smart Borrower Center" at the company's Web site where consumers can get more advice.

LendingTree is raising the fees it charges for leads next month, in an apparent effort to weed out lenders who leave customers dissatisfied with the process of shopping for a loan online (see Inman News story).

Today Inman News looks at two online loan brokers, LoanInsights and BuySide Mortgage, who say they're also focused on customer satisfaction. Putting their clients into the best loan for them -- rather than the one that's most profitable for the lender -- will generate repeat and referral business, they say (see story).

With all the stories in the media about rising delinquencies and foreclosures (and some of the more questionable practices of some loan originators during the boom) many prospective borrowers are naturally going to be more wary. So pitching yourself as consumer-friendly makes sense.

Not that many borrowers were under the illusion that mortgage originators were always looking out for their best interests during the boom. With home prices soaring, many were just looking to finance deals as quickly as possible, regardless of whether they were getting the best loan terms.

Now, with tightened underwriting standards and the virtual disappearance of "affordability products" like 2/28 hybrid ARM loans, some borrowers may just be hoping to find somebody who can get them into a loan -- any loan.