Leadpile’s Blog

Unless you have been living under a rock, you know all about what has been going on in the U.S housing market. With houses being foreclosed left and right, it has put house values at an all time low. Most believe that this was due to large mortgage companies writing bad home loans and giving loans to individuals who clearly could not afford to own a home (or at least the one that they wanted to purchase).
Now until March the U.K government will be offering “A No Money Down Mortgage”. It basically is exactly what it says it is. People who normally could not afford to buy a house because of the down payment, now can. There has been a very split reaction on whether this is going to help or hurt the U.K economy. People are going to be buying houses, putting house sales and values on the rise, and the housing market will be booming. But what happens when the home owners realize that they are in over their heads and can not pay the payments? First they miss one payment, then two, until before they know it their house is being foreclosed.
It almost seems that somehow people do not listen to the world news over there. The same effect that happened to the U.S is going to happen to the U.K. You think that they would have learned from our mistakes. What is almost more shocking is that people think that the government is actually trying to help them. According to Alastair Stewart “Every scheme in history the government has tried to implement in the housing market has gone completely toes up,”. I don’t know why people think that this is going to be any different. All I know is that I hope the U.K does not come to us asking for money when they are in our position two years from now.

Companies working with consumers to modify their mortgages has been going on for almost a year now. However, Ocwen Financial Corp (a servicer of sub-prime mortgage) is one of the first mortgage servicers to begin modifying mortgages under the U.S. Department of Treasury’s Home Affordable Modification Program. The new government program was rolled out in an effort to help mortgage holders who are potentially going to fall behind on their mortgages.
According to Business Journal,”For a loan modification, lenders would have to reduce the mortgage payments to no more than 38 percent of the borrower’s income. The Treasury Department would share the cost for lenders to cut that debt-to-income ratio to 31 percent.
Loans could be extended to up to 40 years. Those lenders who do participate would have to modify all loans, not just the worst ones. Loans originated before Jan. 1 are eligible for the program, which runs through 2012. Homeowners who have an unpaid principal balance of as much as $729,750 can participate. There are also incentives for firms such as Ocwen (NYSE: OCN) that service these loans.
They will receive an upfront fee of $1,000 for each eligible modification meeting guidelines established created by the initiative. They will also receive “pay for success” monthly fees – as long as the borrower stays current on the loan – of up to $1,000 a year for three years.”
Leadpile Lead Exchange has seen the loan modification lead type go through periods of high demand to not much demand. Maybe this lead type has some more life in itself in our marketplace. There still seems to be consumers that will want to be a part of this new government plan. We shall see…..

In recent conversations with many of my affiliates, the conversations about the economy and the housing market have been very popular. The housing market as we all know has impacted those around us in a very dramatic way. There are short sales, foreclosures, and home sale conversations going on with those on the internet, and with those in our every day lives. If you are one that is in the market to buy a house, this is certainly the time to do that. However, knowing what a short sale , foreclosure and FSBO (for sale by owner) are is very important. To help with finding homes to purchase AND becoming educated on these terms, there is a list of websites that Hitwise.com considers the highest ranked real estate websites ending the week of 3/21/2009:

1. Realtor.com
2. Yahoo! Real Estate
3. Zillow
4. ZipRealty
5. RE/MAX Real Estate
6. US Department of Housing and Urban Development
7. Rent.com
8. Homegain
9. Trulia.com
10. ServiceMagic
11. Homes.com
12. Apartments.com
13. Century 21 Real Estate
14. Foreclosure Store
15. Foreclosure.com
16. Reply!
17. RealtyTrac
18. Coldwell Banker Real Estate
19. RealEstate.com
20. MyNewPlace

Leadpile Lead Exchange is always looking for new partnerships with websites such as these, and any other websites that are looking to be monetized. However, we are also looking for those sites that are great resources for consumers to learn information from, such as the ones listed above. Being educated on a large transaction, such as buying a home, is key to making that transaction that much more successful. These listed websites can certainly help with accomplishing that, so you might want to take a look!

Interest rates have gone down, and now many are wondering if it is really that time to refinance their home. The answer is YES. Not all situations are ideal to do a refinance, however there are things to look at with regards to entertaining the idea of refinancing your home right now.

According to ABC news, here are some common questions consumers might want to know before trying to refinance their home.

1. How much will a refinance cost?
2. Will a refinance save you money?
3. What kinds of loans are out there?
4. What are some common pitfalls?
5. What is the difference between a loan modification and a refinance?
6. If I have a prepayment penalty, should I still refinance?
7. If everyone wants to refinance, is the lending industry able to handle this rush?

Leadpile Lead Exchange generates a large volume of refinance (homeowner), loan modification, debt and home purchase leads. These are all consumers that are in this process of trying to determine what their best option is. No matter what the decision is, asking questions is key to knowing what is the best option for you and YOUR situation.

Remember those days when you could pick out all the items you want, and then pay for them each week at your local store?  Okay, maybe not everyone did that, but I remember doing this sort of thing when wanting to buy some “big” ticket items.  Those days seem to be back.  Sears announced it is rolling out layaway!  You shop for what you want and then make a small down payment, then you are done.  Layaway is not a common thing these days, however with the economy retailers are doing whatever it is they can do to get consumers in their stores for the holidays

What happened to layaway and why did it pretty much disappear?  According to creditcards.com, the rise in credit cards being issued erased the high demand for layaway.  Now with consumers having maxed out credit cards, delinquent mortgages, and jobs disappearing, retailers are trying to come up with ideas on how to get that limited amount of consumers in THEIR stores.  Other stores that I found offer layaway are:  Burlington Coat Factory, TJ Maxx, and also take a look at elayaway.com, because this website offers a layaway service.
So, why would Leadpile Lead Exchange be writing about “layaway”? As I have stated in previous posts, we see consumers that are in all sorts of financial situations. Seeing stories such as retailers rolling out an old idea in this tough economy, gives me optimism that there is possibly some light at the end of the tunnel. Every little piece will help those consumers and the economy get headed in the right direction!

Recently, while researching the loan modification lead type, I came across some very interesting (and helpful) information about loan modification. This is something that Leadpile Lead Exchange currently is not generating, however we are currently doing the much needed research to roll out this new lead type.
After speaking with a representative (Souban Houn) who is working in the industry, here is what she informed me that are some “events” that would make a consumer potentially eligible for loan modification.
Generally, loan modifications are considered by the lenders under the premise that the borrowers experiences some sort of hardship that resulted in their falling behind on payments. For instance:

Adjustable Rate Mortgage Reset- Payment (uncommon, but we will see more lenders accept this in the future)
Illness
Loss of Job
Reduced Income
Failed Business
Job Relocation
Death of Spouse or Co-Borrower
Death
Incarceration
Divorce
Marital Separation
Military Duty
Reduced Income
Medical Bills
Damage to Property (natural disaster or unnatural)
Overall, these are “events” that could happen to anyone unexpectedly. Therefore, this seems like a good alternative to going into foreclosure. The unfortunate thing is, some went into these mortgages already in a very tight situation financially, and nothing major has happened to them. However, now the rate is about to adjust and that just makes the difference between paycheck to paycheck TO falling months behind on the mortgage. Tough situation for both lenders and consumers.
Stay tuned for this lead type to be rolled out in our marketplace. There are a lot of consumers needing this assistance, and a lot of people like Ms. Houn looking to assist these customers (if they can).

In recent months with all the foreclosures happening around the world, there is unfortunately some that are trying to capitalize on this. According to MSNBC, one in eleven consumers are facing foreclosure or behind on their mortgage payments. Therefore, consumers are trying to get out of this situation in any way they can. However, there are those scam artist that are trying to take advantage of these consumers trying to get out of their tough situation.
There are two types of scams going on right now with home owners. There are the scams where the consumers are asked to put up some upfront fees to pay for the “assistance”, but then the scam artist disappear with their money. “But the more lucrative scam involves seducing homeowners into complicated transactions that allow con artists to steal equity in the house or walk away from the closing table after netting thousands in phony payouts,” according to MSNBC.
This is a huge problem for home owners that are already in a bad situation. Before allowing anyone to assist in “helping”, all consumers need to really know who it is that they are working with. Asking questions and checking out specifics of these companies/individuals can hopefully prevent some from getting scammed. Unfortunately, peoples hardship is another person’s gain. Our home is one of the largest investments we will ever have, and we can’t allow those criminals to take that away. This can not happen if we are all aware and educated on the different types of scams.

Leadpile Lead Exchange does not currently generate a lot of foreclosure leads, however if there is a company out there that is truly wanting to help consumers from going through this sort of situation, we are certainly able to look at generating more leads. Matching up consumers with legitimate companies to help them is also our goal.

I am not sure how you could have missed what is going on with the economy, however each day there is new news. The latest news involves the government bailing out IAG Insurance Company with a 85 billion dollar loan. Last week the government was bailing out Fannie May and Freddie Mac. We are in a position of having to have our government save these mega giants. These bailouts show what kind of situation we are in now, but what could happen next?
The unfortunate side of this is that none of this has caused any major “positive” changes with our housing crisis. However, the Freddie Mac and Fannie Mae bailout has allowed rates to go down and maybe have a few more people go out and get a new mortgage loan. The latest news is the possibility of changes with Washington Mutual. Hurricanes, takeovers, bailouts, high gas prices, loss of jobs, foreclosures… is there something good going out there? There has to be! Let’s find the positive.
No matter what happens with the economy, Leadpile Lead Exchange will be right there trying to connect consumers needing services with advertisers that can provide that service to them.

Companies in all industries are experiencing the pressure of having to come up with new ways to get consumers attention. Online lead generation has been a tool for helping companies find consumers needing a new home, a new car, or various types of loans. However, with the economy the way it is now, companies are working on trying to attract online customers to “new” types of products.
Gone are the days of focusing all your marketing efforts on high profit margin items such as home sales, new car sales and other high price ticket items. According to leadmarketwatch,“The time between major purchases is growing larger due to market pressures as well as improved quality and higher prices. Therefore, marketers need to capture the client in between purchases and it is through micro-needs like chrome wheels, new tires, paint jobs, etc.” This means that companies such as GM are focusing on bringing in leads of consumers wanting new tires and accessories, versus getting the new car. This is also in line with Leadpile Lead Exchange and the need for lead types such as car warranty, car refinance, and home security system leads that are becoming more and more in demand. Service providers could be the ones reaping the rewards of the slower economy… don’t buy a new car or house… fix up the one you already have!

In a continuing effort to research all the options consumers have available to them, I came across a type of loan that I have never seen before. The newest and latest way for consumers to get cash is by taking out a cash advance from their home. Currently, consumers that are age 65 and older have often looked at the option of doing a reverse mortgage. This is basically the consumer taking out a loan on their home, but the loan not being paid back till after they pass away. However, it appears there might be another option available to them.
Something new that lenders are looking at is offering consumers cash advances on their home. According to The New York Times, “Owners 65 to 85 with good credit who live in homes valued above $400,000 (above $500,000 in New York and California) can receive a payment of up to 15 percent of a home’s equity.” Something like this costs the consumer no closing costs unlike a reverse mortgage. There are certain stipulations the consumer has regarding the sale of the home, however the simplicity seems to be there compared to doing a reverse mortgage or other lending options. Yet is this a logical choice for consumers? Not everyone has a home valued above $400,000 either.

The options that homeowners now have are:
1. Refinancing
2. 2nd mortgage or lines of credit
3. Reverse mortgage
4. Home cash advance
5. Loan modification

and what’s next?…………………………….

Consumers are looking for anything and everything they can do to survive. Does this mean a potential new lead type for Leadpile Lead Exchange? Let’s wait and learn some more about this new option available.

Today I was not surprised to read that CNNMONEY.COM reported that due to the housing markdowns, and the effects of the mortgage industry, GMAC Financial will close 200 retail offices and lay off about 5,000 employees.  According to the article, they anticipate the lay off to be about 3,000 employees by the end of this month, and another 2,000 by the end of the year.
Layoffs like this one, is one of the reasons why the unemployment rate is at the highest peak ever. More and more Americans are loosing their jobs and finding themselves more in debt.  The mortgage industry is facing a downturn, however at the same time I know there are still many companies that are doing well. These companies are trying to take advantage of the new “creative” programs to close loans.  Mortgages will always exist, therefore certain companies will make it through this period with a bumpy road and then be around another 20 years!

What do you think in regards to the Market?  How long do you anticipate it being before it gets better?

In the last year many mortgage lenders have been closing their doors. Auto lenders are getting “selective” on who they lend to. Payday lenders are getting put under a microscope because of various features of their loans. There is not one consumer that is not somehow being affected by this credit crunch. Is any of this happening because of the side effects of predatory lending?
In recent years, industry regulators have had an eye on every sort of lender in regards to potential predatory lending. According to Payday Loan Industry Blog, predatory loans are those that were given out to consumers with deceit or misleading information. This could be related to the terms of the loan, the type of loan or anything else related to the loan and what is conveyed to the consumer. In addition, predatory lending could be where a lender is taking full advantage of the consumer. Predatory lending is not necessarily because the interest rates are high or the cost of doing the loan is expensive. Some try to refer to payday lending as predatory lending.
Payday loans are a loan that many need for a temporary loan to get through a unforeseen situation that has occurred. These loans are usually about $500 and secured by a person’s paycheck. Payday loans being a part of the predatory lending arena should not necessarily be the case, because consumers are conveyed the rates and the cost of doing the loan. However, if a lender does not do this or misleads the consumer, then that could be considered predatory lending.
The bottom line is no matter what kind of loan you look at taking out, you need to ask a lot of questions. Understand fully the cost of doing the loan. The more you try to find out, the better chance you have of not becoming a victim of predatory lending-it’s everywhere, not just with one type of loan.
Leadpile Lead Exchange works a lot with payday loan leads, refinance leads, auto finance leads and other types of lending leads. However, predatory lending or misleading consumers is not something that we promote in our marketplace.