Wuthering Eff-ing Heights

My good friend Chris Hahn sent me this Blackberry snapshot from his new hometown across the pond---the big Pond, as in London...as in England. (please note the ironic, digital, photojournalistic humor: sign, motorbikes, disobedience,etc...we taught the young lad well.)

He's without wheels so he's walking everywhere and eating Indian food like crazy, or at least, like a Brit. His pre-arranged, semi-furnished 'Flat' fell through so he and Nicole are holed up in temp housing for the time being. She's working 2 million hours a week at her new job. He's watching a lot of soccer. The man needs a cheeseburger.

His depression hasn't hit Bronte sister level yet but just between us Chicago real estate folks, I get the feeling our flyboy and former favorite Mortgage Guru is a little homesick. He had a soul patch, recent Mexican tan, and a two day beard growth when I last left him at the bar on Lasalle last month so.... hopefully he can remain cool. To avoid profiling at Airport Security, I advised him to remove all Brooks Brothers neckwear, wing tip shoes, and button down collars from his carry on baggage. Suspected Bankers are fleeing the country in droves these days, I warned him.

Anyway, Chip, chip, cheerio...time to go.

ps...remember Mr Hahn, a Yankee is one who visits. A damn Yankee is one who visits and stays.

Geno Petro


photo courtesy of chris hahn walking around London with nothing to do.

Big, Hungry Beast

Ding Dong (the doorbell)

...And immediately all hell breaks loose in the house. My 125 pound hound starts baying, and woofing, and snorting. toenails clicking and sliding sideways on the hardwood floors while his too short legs lose traction, and he barrels head down, straight ahead--like the slowest guard on the football team-toward the front door to protect us from the FedEx guy.

"Dude," I say, grasping his choker collar with one hand and wiping the slobber from his jowels with the side of my jeans. "Act that way when they don't ring the doorbell." Like when they come through the basement window I want to say, but there is no need to expound. He's just a hound with a three or four track mind.

He's a big guy and needs fed a lot. When I cut back on his portions, eliminate the table scraps, or forbid the bisquits until he drops a pound or two, he's very put off. He's come to expect a lot of food on a regular basis. He expects a lot of attention. He's just like my bank. Just like them...

Them

Maybe they got a little too fat, too quick. Maybe they made some wrong choices off the menu. Maybe they liked the restaurant so much (when they were flush with dough) that they bought and staffed it--the whole chain, perhaps. An entire sector.

They found investors overseas and lured them into the business model. They spent billions on land acquisitions, brick and mortar. They increased their payrolls, cut their rates and flooded the airwaves and web with promotion. They experimented with new, low-fat, low-interest cuisine. They found a way to feed anyone. They thought they could service everyone.

Then the media stuck their snouts into the soup and found that there were just too many cooks in the Kitchen. Hell, there were just too many kitchens. They discovered that a few Chefs (Chiefs?) at the top of the food chain were skimming the cream off the top of the vat. Customers began sending their meals back, skipping out on the bill, cancelling reservations, staying at home...Perhaps the cooks and busboys were here illegally and scattered into the gangways and alleys leaving their houses (and promissary notes) behind. What about E-coli, non-smoking sections, and foie gras? The investors overseas demanded a raincheck. The tougher ones demanded a refund. The banks looked into the mirror, studied the ugly sight, and went on a crash diet. They pledged to starve themselves back into shape.

Us

Now even the best customers have to pay more. There's a shortage of product. "The credit is a little crunchy this month, don't you think?" we say to our Loan Originators as they stand before us, still willing to serve, and a little hungry themselves.

We asked for the check but our credit card was denied. We stopped making even our minimum payments. We stopped even looking for a parking space. The red coat valets and attendants fail to even show up. There are no cars to park. Things are lean. We start eating our young...

Hunger

...But for how long? How long can a big, hungry beast like my dog go without food? Eventually he will find a way to settle his stomach. Same with the banks. They are a huge part of the GDP and it is only a matter of time before the purging stops and the yo-yo begins to sail up into the opposite direction. And just like all failed dieters, they will actually end up a little heavier than before the whole cycle started. You just wait and see. You can say 'I told you so' if, in 5 years, total reported banking profits, and the number of loans originated, aren't significantly higher than they are today.

There are a few weblogs on the subject of Lending I read with great frequency. One is Dan Green's The Mortgage Reports out of Cincinnati. The other is Brian Brady's Mortgage Rates Reports out of San Diego. And of course, I communicate on a weekly basis with the Mortgage Guru here in Chicago, Chris Hahn. And we all have a different take on the subject.

But hey, from a realtor's point of view, this is how I see it. And as I sit here at my desk watching my dog asleep on the floor, snoring and twitching and chasing rabbits off in doggie dream land, I know the peace is not for long. His belly is full now and he is content. But if he goes too long between meals, and no one pats him on the head, and the door bell rings...well, I just wouldn't want to be the FedEx guy. Like I said, 'He's a big, hungry beast and he needs to be fed...'

the image is not my dog

Send Lawyers, Guns and Money...

When I attended my very first Closing of my very first deal with my very first client I sat at the Title Company table feeling a little like a simple house cat trying to wrap his mind around calculus. Honestly, I never paid much attention to what I was signing for the six or seven properties I bought and sold as a consumer before I was an actual Realtor. I just always assumed that my agent and mortgage guy 'had my back' and figured that they wanted to get paid as much as I wanted to move in or out. If I learned one thing in my pre-Realtor Fortune 500 career it was the concept of 'Recruit and Delegate' and there was no reason to believe it shouldn't spill over into my personal affairs, as well.

I discovered during my 15 years in a suit and wingtips that a person can recruit, if not delegate himself into and out of almost any business situation. I was even going to write a book about it once but only got about as far as I've communicated to you here before I began looking for someone else to write it for me. I'm not sure how many words per minute I type these days but I've already been at work on this for 20 minutes so you can do the math if you like. An IBM Selectric typewriter was my weapon of choice in those days so without the technology that now rests at my fingertips (and that would be exactly two with my typing technique) the man hours involved in such an endeavor would be have been brutal. And as usual, I have digressed...

So at my first Closing as a licensed Realtor I was like that actor in that dream about to go on stage with a pretty good idea of what the play is about but not the slightest idea of what the exact lines are--a cross between that, and the calculus curious cat I mentioned above. I watched and listened in amazement as the real estate Attorney went through the scores of pages in both packets--first the loan and then the title. He explained in detail what each form meant; where to initial, where to sign, and what to expect if too many late payments occured or how to make an extra payment every now and then to reduce the principle and accelerate the mortgage.

"This goes to the city. This goes to the state. This goes to your broker," glancing my way with a nod and a wink. His voice and the occasional sigh from my client were the only sounds in the room besides the furious scratching of ink on shuffling paper. Like I just said, I didn't know my lines back then so I wasn't saying a thing although I did want to interject the fact that whatever was coming to me was actually coming to my brokerage office instead and I would receive but my mere cut of the proceeds. Whatever. I just looked on in silence as I've learned to do at every Closing since.

My point here is that a Real Estate Attorney is a 'must have' for any transaction in Chicagoland. Rarely do they come into the picture before an Offer is accepted but they certainly earn every cent of their flat fee, in my opinion, from the Review Period onward. And an FYI to those of you from neighboring states or places far beyond the boundries of Cook County; Title Companies here only record and check the paperwork and distribute the funds. It is the Attorney who does all the explaining. Even after witnessing a hundred or so of such escrow closing ceremonies myself, I would be remiss in thinking I could accurately guide a trusted client through 200 pages of legal documents. And since my transaction activity spans the entire gamut of six and seven figure properties, there are just too many zeros and virtually no room for error in these scenarios for this cat.

Same holds true with the banking end of my deals. I defer to my Mortgage Guru almost 100% of the time I write an Offer. He's helping one of my clients out of a jam even as we speak, as her 'low interest rate internet loan' suicide bombed itself a week before Closing. Recruit and delegate, I'm telling you.

So okay...maybe it's not enough subject matter for an entire book but if you are still reading this by now then I am happy I guess. As I often tell people requesting my advice in real estate legal matters, "I purposely didn't go to law school because I purposely didn't want to be a Lawyer. Besides, have you ever tried to explain the Pythagorean Theorem to any of your family pets? Sure, they will listen but it's pretty obvious from the look on their faces that they are really quite content not knowing what they already don't know. What they do know is how to get fed and watered at regular intervals and I'm pretty sure that's a form of delegation, even if at the lowest of intellectual levels.

Anyway, that would be me. I'm real good at stalking down and retrieving property in Chicago and will even mix it up with the opposing licensed tomcats in the alley if necessary. But my suggestion to you when I show back up with the goods is, if you havent already surmized...call my Guru then get a Lawyer.

Geno Petro