Thread: Tekno's Jekyll Island

agree with pyriel here.....arms have become a great tool for the real estate investor.

flipping the property inside the fixed timed frame is the cats meow!!

right now both the stock market and this tropical storm are kicking my tail......hope to dry out soon:P

I wonder if this has anything to do with Charles Givens, the info-commercial guy I watch when I can't sleep?

pyriel wrote:

I do feel that there are alot of people that got sucked into this. But for now, I don't foresee it damaging the economy. If the FED continue to increase rates and trust me they will, they are going to be in alot of hurt.

I bought a property using 7 yr fixed and automatically converts to ARM. Ifigure that in 7 years, I canget equity from the property, received cash flow for it, deduct as much as I can to lower down my income, and all along let my tenants pay for my mortgage. Yeah... I'll jump in any ARMS rate if the deal is right...

The problem with real estate investors like me is cash on hand. Our cash is always tied up and good deals comes in spurts. Jumping in to a 1 year fixed and ARMS afterward is not a bad deal at all since we can remortgage it once our cash is freed up from our investments...



First off, I wish you success in your endeavors.

Yet Greenspan encouraged many to finance their property or properties via ARM. But did or does he expect those who did or do not either have a very good credit rating or a sizable downpayment to change their behaviorswithin 2, 3, or 5 years and become financially prudent? After all their lifestyle and spending habits required most of them to pursue unconventional financing.

Also, there is a difference between investing and speculating: the real estate market is large and diverse. Yet most would agree that property appreciation in real estateover thepast few years is not sustainable. If a particular property appreciates 14% a year over 7 years, well that's close to 100% -- minus 66% interest paid over that time frame -- that which is not tax deductable. Inflation would make one's payments in cheaper dollars as well.

Refinancing is a benefit as well, but that comes at an upfront cost too.

I hope your endeavors are successful.

Question. I didn't pay any attention to, nor did I know anything about, the market in 2000-2002. I'm sure a lot of us here didn't either. Can someone tell us what the main reason was for the market bottoming out? Inflation, deflation, recession, taxation, manipulation? I think it might help all of us if weknew what started it all. Me anyway.

Forgive me for my ignorance........

I'd also like to hear from a "regular Joe" who was going through it and not some analysts opinion who got paid to talk about it. I think we get a better idea from someone who has been through it instead of someone who "reports" it. Any chance we areheaded that way again? Tom?

Thanks,

M_M

BTW, Lindsay Lohan wasn't driving this time, but apparently the papparazzi was the reason again..........

http://quote.bloomberg.com/apps/news...d=a2WnQ1aK8zBg

The columnist mentions inflation is more a matter of the money supply than anything else, i.e. oil prices, labor market, etc.

It would be interesting to know what percentage of income mortgage loans account for, and then what percentage of that are ARM.

Some would say ARM may be similar to other "high yield" bonds. There are exceptions to the rule, but it generallyassociationis of higher risk... and so a greater chance of default.

MM....I was paying alot of attention to the market at that time and it just played out....the Reagan push and Bush push was left with the Clinton legacy....which didn't push and it opened the door for a final'e.....I remember telling some people at the golfcourse in June July timeframe before the election that when Clinton loses, and Bush wins, the economy was going to go south.....as a matter of fact it started to go south that summer......the information and communication tech was maturing and that was driving the economy at that time....they had reached their peak for the time being and there was no where else to expand to in great strides....the auto industry which at that time had benefited from the computer technology was going gangbusters from the new technology and accuracy that computers were bringing to their designs.....

The economy had expanded and then it quit.....we are now in the aftermath of that expansion and we are waiting for the next great market idea to come along which will be another 10 or so years .....until then, we are robbing the land to gain wealth, taking houses and such, or we are investing in new lands to gain wealth....producing needed goods and services at high prices to pay for our high bills that are ever so often are going up ......strange how the government hasn't recognized this for years.....when all along they started the inflation thing with the massive influx of the M3 money supply.....

So lets all plug along together shall we....or shall I say "lets all slip slid away together"!!!
:dude: