It bothers me now, the amount of people that call me, ask why talk about the pain to others. They are curious enough to hear me rant and they are intelligent enough to make good decisions on their own. For sure, the things I say are not for everyone and should not be taken as legal advice, but I say things that lawyers can't say. I get calls now daily from people you know and don't know, people I did not know and I find a few things are almost always true: The denial is wide spread. Everyone is scared in their own way, has their own timeline for destruction and EVERYONE says they are not like us. Yeah, I get that. I heard that from some of those who have perished by now. No one is like us, but everyone is burning cash one way or the other. Either you are out of cash, and burning the banks money, or you have cash and are still burning yours. This, I don't care how much we are not alike, is truth. I heard from a pretty smart, grey haired guy the other day, he is going to get a credit line at his bank, take the last bit of equity he has in a piece of collateral and use the 400k he gets to pay to keep his interest current. LET me get this straight....IF a bank will give you a credit line on your last asset of 400k, it must have money to lend under different guidelines than I am used to. This is a person who builds, has not sold a home in a while, has bought their own inventory as a defense method to gambling and not selling. Use the last bit of good credit and loans you can get to buy your own real estate at more than it is worth. Newsflash: I can buy down the street from you cheaper than you can build. His plan, although sound in his mind, is disturbing. He owes more than his home is worth, and that is in the low 1.something millions. ZERO equity, has drained to nothing in the bank, does not sell any homes now, and has many finished and unfinished lots in a pipeline of what was a
good business and plan in the good days. He wants to borrow so his bank will continue to like him. He is a fool.
There are 2 types of builders that have inventory right now that was built between 07 and now. If it is standing and not sold, it is on ground that was overpriced, which was good for the
good business and plan in the good days. He wants to borrow so his bank will continue to like him. He is a fool.
There are 2 types of builders that have inventory right now that was built between 07 and now. If it is standing and not sold, it is on ground that was overpriced, which was good for the
developer. It was appraised at a time the appraisers thought it was worth more than it is. The banks, LIKE IT OR NOT, hired that appraiser, collected their fees, cashed them and the interest they used to pad their balance sheets and grow their stocks and companies during better times. The subs worked on these homes and got paid at top dollar and either are paid now and don't care or are not paid and wanting 100 pennies of what they are due, plus their collection efforts. The suppliers are the same, all of these people got paid on the way up with the vision that made sense, WHEN FINANCIAL TIMES MADE SENSE. We are dealing with a FINANCIAL MELTDOWN OF APOLOCALYPTIC PROPORTION for some of the companies and how they/we were set up for 08 and 09. Back to the new construction. If the home is not sold now, there is a realtor that is expecting to get paid, who does not have the money to market any longer, and hey, what is the message he would pay to market anyway? Nice home, quality finishes? Uh, nope it looks like now it is, nice home, priced just at what the bank is owed PLUS MY COMMISSION....Hows that working for ya? So, let me get this straight, pricing on the home must be tailored so that everyone gets paid 100% for their efforts to construct it but the builder? The very necessity that it took to create the vehicle to get paid? You gotta be shitting me. I created GIVE BACK as a message to get people in the mindset that they do not get 100% back or the homes will travel the eventual path. Those of us that ran out of money first will show you the way. Checkthe paper, it has been graced with a few to start. IF YOU DO NOT DO SOMETHING WITH YOUR REAL ESTATE NOW SOMEONE WILL TAKE IT FROM YOU AND DO IT FOR YOU. Liquidate the damn houses. They are not worth dying over. Your banks are sick and do not have enough cash to loan right now. If they did have enough cash, at audit time the truth will come out for them. They don't have enough cash to stay afloat much longer EITHER. They are lying to you, and they are lying to the share holders about how sick they are. They are spending hundreds of dollars an hour to send hundreds of reminders to builders right now that they want some money or else.....OR ELSE WHAT. Are you kidding me? They will take the houses, then re-hire another realtor that does not have the money to market them? And magically the home will sell. BRILLIANT. We should have thought of that before?
Think about this, the money lent during the good times on homes that are not sold today is your biggest concern. Your homes, our homes that are not sold were not required to have cash down, so we borrowed at 80% of the value of the good times. Now those homes have ridden the market down, to what we owe plus...yup, you got it a big ole paycheck from that person that is powerless to assist you much further. The homes are over leveraged and you can admit it now, or sometime after that home is taken from you. If it is overleveraged, and you are too busy pointing at us or others and whispering you are not like us, and you have an agent that is not selling, then you are meant to perish. YOU ARE LIKE US BECAUSE YOU BORROWED LIKE US AND PAID FOR LAND LIKE US AND HIRED SUBS LIKE US AND ARE STUCK IN THE SAME FRIGGING MARKET WE ARE STUCK IN...Just exactly what about us is not the same? If we can fast forward now past the micro picture of one at a time, and just assume for arguments sake I am right, we are alike, we are sick together and we have the cancer. The financial cancer of overleveraged assets. We are in the same market. That we must fix. What makes some of us different is that some of us are out of resources and do not, cannot pay our banks their life support any longer. This is ground zero. Cant lose much more. Even if we could borrow, we refuse to throw good money after bad. Save the relations for later. WE will need them. What makes some of you different is you may still have resource. My guess is that the more successful you were before the APOCOLYPSE you have more dough in the bank, and the more dough you have, you are burning it faster than ever as sales have slowed. Your absorption is the direct result of the current market we all share in common. Not like us? Nope, you are losing your cash, we have lost ours. Beauty is, I can do math. Once you run out of your cash, because you are not like us and you still have it, you will see just how much you are like us. Once you get to ground zero you will call. Once you get there I will remind you that you should have called sooner. And once you get there you will finally wake up and realize that we all share in the same big problem...
Do the rest of us a favor, get off your high horse and push. Did I say that? PUSH BACK. Don't run yourself out of resources giving a local bank money to operate. Do you know that we have one bank that spends over 500$ per hour kicking our financial ass? ONE GUY. The result? UNFORTOLD. What I want to know is what the hell do the shareholders think? The bank is
not giving them up to date information so they are hoping their community bank is still healthy. Wrong, they cant afford to hire that guy so they are borrowing now to kick our ass. That's funny. We switched a long time ago to a FEE BASED lending environment. Some banks were formed with the sole intent to do construction or FULL arms of lending were extended to construction loans. They got paid. Now there is no money to loan, no fees to collect, and as soon as those of you that are NOT LIKE US run out of money, they will not have interest any longer. Let me ask, what is a builder that cannot borrow or sell? Broken. What is a bank that cannot lend for fees and is not getting income from loans that are not performing? Broken. And what happens to the real estate if someone does not figure out another way to deal with it? Class......? It gets taken from you and sold anyway. To who??? Class???? A bottom feeder. Yup, in November I mentioned them, they are the eventual cleanup process either way. Now or after the banks get more broke. Embrace them, for they are real and they are out there. Some better than others. Know which vulture to pair up with. They don't mind waiting til you are dead. And let me tell you something, I talk to enough people now, just like the Bruce Willis movie, I SEE DEAD PEOPLE. They are walking, but financially dead. The vultures are very patient. Eat the dead meat off your bones. WE did the repulsive act of letting them eat off our bones while still alive. IN hopes to get the cancer off the body and in hopes of surviving. Weather we survive or not, a survivors club is being formed. Those that make it through, will have lost their hair and taken the poison in the fight for financial life. They will be given PUSH BACK survival bracelets, which will be made at the end of the year and distributed. Once a survivor, you would be asked to help just one, more if you can, but just one sick person. WE all do that, and we can get to healing.
Think about this, the money lent during the good times on homes that are not sold today is your biggest concern. Your homes, our homes that are not sold were not required to have cash down, so we borrowed at 80% of the value of the good times. Now those homes have ridden the market down, to what we owe plus...yup, you got it a big ole paycheck from that person that is powerless to assist you much further. The homes are over leveraged and you can admit it now, or sometime after that home is taken from you. If it is overleveraged, and you are too busy pointing at us or others and whispering you are not like us, and you have an agent that is not selling, then you are meant to perish. YOU ARE LIKE US BECAUSE YOU BORROWED LIKE US AND PAID FOR LAND LIKE US AND HIRED SUBS LIKE US AND ARE STUCK IN THE SAME FRIGGING MARKET WE ARE STUCK IN...Just exactly what about us is not the same? If we can fast forward now past the micro picture of one at a time, and just assume for arguments sake I am right, we are alike, we are sick together and we have the cancer. The financial cancer of overleveraged assets. We are in the same market. That we must fix. What makes some of us different is that some of us are out of resources and do not, cannot pay our banks their life support any longer. This is ground zero. Cant lose much more. Even if we could borrow, we refuse to throw good money after bad. Save the relations for later. WE will need them. What makes some of you different is you may still have resource. My guess is that the more successful you were before the APOCOLYPSE you have more dough in the bank, and the more dough you have, you are burning it faster than ever as sales have slowed. Your absorption is the direct result of the current market we all share in common. Not like us? Nope, you are losing your cash, we have lost ours. Beauty is, I can do math. Once you run out of your cash, because you are not like us and you still have it, you will see just how much you are like us. Once you get to ground zero you will call. Once you get there I will remind you that you should have called sooner. And once you get there you will finally wake up and realize that we all share in the same big problem...
Do the rest of us a favor, get off your high horse and push. Did I say that? PUSH BACK. Don't run yourself out of resources giving a local bank money to operate. Do you know that we have one bank that spends over 500$ per hour kicking our financial ass? ONE GUY. The result? UNFORTOLD. What I want to know is what the hell do the shareholders think? The bank is
not giving them up to date information so they are hoping their community bank is still healthy. Wrong, they cant afford to hire that guy so they are borrowing now to kick our ass. That's funny. We switched a long time ago to a FEE BASED lending environment. Some banks were formed with the sole intent to do construction or FULL arms of lending were extended to construction loans. They got paid. Now there is no money to loan, no fees to collect, and as soon as those of you that are NOT LIKE US run out of money, they will not have interest any longer. Let me ask, what is a builder that cannot borrow or sell? Broken. What is a bank that cannot lend for fees and is not getting income from loans that are not performing? Broken. And what happens to the real estate if someone does not figure out another way to deal with it? Class......? It gets taken from you and sold anyway. To who??? Class???? A bottom feeder. Yup, in November I mentioned them, they are the eventual cleanup process either way. Now or after the banks get more broke. Embrace them, for they are real and they are out there. Some better than others. Know which vulture to pair up with. They don't mind waiting til you are dead. And let me tell you something, I talk to enough people now, just like the Bruce Willis movie, I SEE DEAD PEOPLE. They are walking, but financially dead. The vultures are very patient. Eat the dead meat off your bones. WE did the repulsive act of letting them eat off our bones while still alive. IN hopes to get the cancer off the body and in hopes of surviving. Weather we survive or not, a survivors club is being formed. Those that make it through, will have lost their hair and taken the poison in the fight for financial life. They will be given PUSH BACK survival bracelets, which will be made at the end of the year and distributed. Once a survivor, you would be asked to help just one, more if you can, but just one sick person. WE all do that, and we can get to healing.
Remember, this is a cycle. How many cycles you see will often depend on your degree of gray hairs. Many means you may see one more, none yet, a few. One thing for certain, we are gamblers. We created lives we were comfortable with, we don't conform to day jobs, we are a bit off and work best seeing our own efforts flourish. AND WE LIKE NICE THINGS. I cant tell you how many of the people are not like us that I talk to still have the old lifestyle. I see liens connected to names, lawsuits, inventory reports, and the level of sickness is evident. Then I get the call...."not like you", ran out of cash. But still has that muscle car in the garage, the boat, the dual SUV, typically the Escalade or slammed out Denali, you know the one with the low profile wheels and tires...The nice house, second house at the beach or somewhere, trips, nice ones too. And the real one, this one kills me. GOLF anyone? Are you kidding me? Your name all over telling us that it hurts and you have the money to golf? Are you kidding me? And not just cheap stick, spendy golf. The kind you used to let your banker pay for, you know the one who sold you loans? Where is he now? Most of ours got whacked. Or the title guy that is now gone. Or the supply guy who sold lots of overpriced shit and wooed you to play. And the time it takes to golf? Wait til you become like us. We don't golf anymore.
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