LIVING OFF DIVIDENDS & PASSIVE INCOME

Spoke to a mortgage broker last night. He says business is down but not too bad. Apparently he specialized in sub-prime loans and it wasn’t uncommon for him to make 6 points off a loan. thats $24,000 commission off a $300,000 loan. If that isn’t obscene profiteering I don’t know what is.

WSJ online ran an article that shows how much money some brokers make. $120,000 is average, $1 million is possible and $10 million isn’t unheard of. All this money to do computerised loan processing and underwritting which doesn’t take too long. They predict that this business will do the way off the discount real estate broker offering fixed price servics regardless of the size of the loan. Here’s a snippet from the article.

Mortgage Brokers Benefit From a Refinancing Boom

By JOHN HECHINGER
Staff Reporter of The Wall Street Journal

From The Wall Street Journal Online

WALPOLE, Mass. — Tom Digan doesn’t have to make a hard sell these days to cash in on the mortgage boom. He just needs to pick up the phone.

In his small office, overlooking an auto-repair shop, the 44-year-old mortgage broker returns a call from a customer who wants a $240,000 loan — one of 50 to 150 daily calls that jam his voice mail. Mr. Digan checks a sheet on his desk, calls up an online credit report and offers a great rate: 5.5% on a 15-year mortgage. “I’ll write it up right now,” he says, scribbling financial information on an application.

Once the loan closes, Mr. Digan and his employer will split a fee that might make a corporate lawyer do a double take: $2,800. “I know what you’re thinking,” Mr. Digan says. “He made $1,400 in 15 minutes.”

• How To Pay Off Your House In 3 Years! Previously, I had complained about the content in CNN's Money's Millionaires in the Making. Its always a rehash of rich people who're saving their extra money and are going to be rich.Well after some research I think I've found something thats a whole lot better - but it comes from......
• How To Avoid Foreclosure You must have read the recent post about the New York Times economics reporter who is facing foreclosure himself. Edmund Andrews covered the US economy and Alan Greenspan for over six years, but despite his financial accumen still got suckered into a loan he couldn't really afford. He hasn't made......
• When Is Enough, Enough? UCLA Alumni, Andrew Lahde, announced last week that after making an astounding 866% last year, he was closing down his hedge fund and returning all the money back to his investors. While it's not certain how much money he's made, it has been speculated that he's worth around $30 million......

• Wachovia's Bad Day?: A Lesson in Reading Between the Lines A little disclaimer before you read on. This post is kind of lengthy. The point of this post is not to recommend an undervalued stock. This is a detailed look at how earnings are reported vs the way Wall Street interprets those earnings. It might get a little heavy......
• Introduction to Mortgages pt 5 of 5 This is part five in a five part series on what you need to know about mortgages before you buy a home. The housing market is an interesting beast, because it comes and goes, rises and falls, allows some people to flourish and brings others to ruins. If you want......
• Own A Home? You're On Welfare. Well, at least that's what a columnist in Time magazine thinks. (It is in the current paper issue, so it's not available online yet.) I never really thought about it that way, but he is kinda right - owning a home does provide the homeowner with a kind of welfare......

[All content is copyright of Living Off Dividends & Passive Income]

Random Posts

• March 26, 2008 -- Understanding The Subprime Mess
• January 6, 2009 -- Will 2009 Be A Good Year For Stocks?
• November 17, 2007 -- Quick, Hide Your Ron Paul Dollars!
• October 13, 2006 -- Bank of America Announces Free Online Trading
• November 7, 2006 -- Its Carnival Time
• April 21, 2008 -- 1st Carnvial of Dividends & Passive Income
• September 15, 2006 -- Trust But Verify