Blog with MAE Capital

FHA Loans were born from the great depression in 1933.  The idea of the government insuring a Real Estate loan, at the time, was groundbreaking.   In today’s world, we expect the government to step in and try to fix things when the economy is sluggish or depressed.  Back then our government was far less a part of the ordinary citizen’s life.  So when the private sector was approached by the government to insure mortgages that were traditionally insured privately by large down payments was a groundbreaking concept.  At the time Banks and Brokers were the only way to get a home loan and they required that a potential home buyer put 25-50% or more down to buy a home.  So when the government said they would insure mortgages up to 95% of the value of the home, you can imagine how this changed the way Real Estate Loans were originated.   It was designed to stimulate housing growth to get the country out of the grips of the Great Depression.  It worked, along with a whole new age of people relying on the government to help them when things were tough.  Out of the Great Depression, we also got a welfare system, unemployment insurance that the government collected from employers to help with displaced workers and a whole litany of other programs that expanded the scope of the Government.  The Federal Housing Administration (FHA) was designed to be a short-term way to get the housing markets stimulated to get America out of the Depression.  The program still exists today, and you can take full advantage of it.  

Today FHA loans are still alive and well and are still used today to get people into a home with a small down payment of 3.5%.  FHA loans are still viable loans for those who have a small amount of money to purchase a home.  The way an FHA loan works is very similar to Conventional Loans in that a potential borrower must qualify for the loan with their income and current credit.  When we say qualify there are several factors that a lender must review in order for a client to “qualify” for any loan.  These factors are but not limited to having shown the ability to handle credit or in today’s word have a credit score that meets the criteria of an FHA loan (550 or better).  Generally speaking, FHA loans are more liberal when it comes to having a good credit score than that of its Conventional counterpart.  If a borrower has a low credit score due to circumstances out of his or her control and has shown that they are trying to take care of it and that is the only factor with regards to their financial situation they generally can get approved for an FHA Loan.  There are several other factors that must fall into line before that can happen, however.  For instance, a borrower’s house payment combined with their monthly bills should not exceed 43-50% of their gross monthly income.  This brings us to verifying income and what is required by FHA.   First, a potential borrower must have a two-year history of working which could be multiple jobs or a combination of school and a job and must be able to show that their income will be stable enough to maintain the mortgage payment. Next, a borrower has to be able to prove they have enough money for the 3.5% down payment.  This money can come from savings or can be a gift from a relative a close family friend, or an approved Down Payment Assistance Program.   

We talk about FHA loans being a federally insured loan, but what exactly does that mean when you have to pay the mortgage insurance on a FHA loan? Simply put there are two payments to the insurance fund a borrower will have to make; one the upfront insurance is 1.75% of the loan amount (Sales Price minus the 3.5% down payment requirement) this is added to the loan so you don’t have to come out of pocket for this; two the monthly payment of the mortgage insurance is a small percentage of the Loan amount every month.  These insurance payments go into pools that are designed to protect the lender’s yield on the loan if there is a foreclosure allowing for the lower down payment.  This insurance makes FHA loans more appealing to lenders and thus lenders have more flexible underwriting guidelines and can get more people into homes utilizing the FHA Loan.  

When talking about flexible Underwriting guidelines your eyes probably just rolled to the back of your head.  Not to worry I am here to help break it down to simple bullet points that you may not have heard of before.  Being evaluated for loan approval seems daunting but that is why we have a team of folks to walk you through the whole process.  Our highly qualified loan originators will walk you through the process.   The Loan Officer will gather your pay stubs, tax returns, bank statements, and W2’s and they will do the analysis for you.  Your loan officer will check your credit, check your debt-to-income ratio, and make sure you have enough money verified to close the transaction.  The loan officer’s job is to paint your financial picture with your financial information and present it to the underwriter, who will approve your loan.  Our Loan Officers do this every day, multiple times, so they are experts at what it takes to get an FHA loan approved, so when you are looking for expert advice and guidance please let us to walk you through this process.  

The benefits of using an FHA Loan are:

  1. You Only need 3.5% for a down payment and that can come from your savings, a gift from a family member or an employer, or a government institution, or an approved down payment assistance program.
  2. Your Credit Score can be as low as 550.
  3. Your Debt-to-Income Ratio can be as high as 50%
  4. Interest Rates are Lower
  5. You can take cash out of your home up to 85% of the value of the house.
  6. You can finance 1-4 units utilizing FHA.
  7. You can buy a house 2 years out of bankruptcy.
  8. You can utilize special down payment assistance programs with FHA where you can literally come into closing with only 1-2% of the price of the house.
  9. There are a few more technical advantages that are there but are a bit too confusing so know that FHA loans give you an advantage if you are not an A-1 borrower and still get great rates.

Now that we have explored the history and the benefits of using an FHA loan you may ask:  “How do I apply for an FHA Loan?”  At MAE Capital Real Estate and Loan, we have over 39 years of experience working FHA loans, so we should be your logical choice, not to mention our interest rates are better than the rest.  Simply click on this link and you can start the process or call us at 916-672-6130 and we can do it for you over the phone.     

Posted by Gregg Mower on May 6th, 2024 9:55 AM

By now you may have heard that things are changing in the Real Estate world with regards to commissions.   In a landmark decision, the National Association of Realtors (NAR) has lost a lawsuit that stated that Real Estate Buyers should be able to negotiate commissions with their agent and or Seller.  The lawsuit further states that Real Estate Buyers have the right to negotiate how their agent is paid and by whom.  We will discuss some of the pros and cons of this landmark case and how it will affect buying and selling real estate in the future.

Currently, Real Estate commissions have been paid by the seller of a property and is negotiated upfront prior to their property hitting the open market.  The traditional commission structure has been 5-6% of the sales price and if another Agent other than the agent who procured the listing called the buyer's agent generally splits that amount with the listing agent.  For example, if you are selling a home with a 5% commission in the listing agreement when another Agent brings a buyer to the home the commission to that buyer’s Agent has already been negotiated with the seller and that has traditionally been half of the total amount and in this case, it would be 2.5% to the Buyer’s Agent and 2.5% to the Listing Agent.  With the new ruling against the Real Estate industry, it now states that the buyer will have to pay for the commission when represented by an independent Agent.  It still can be asked that the seller pay this amount but now the Buyer has to be notified that it is their responsibility to pay their Agent.

One should know Real Estate law states that any Agent in a Real Estate transaction must take the seller’s best interests into account during the Real Estate transaction.  The exception is that if a Buyer contracts with an outside Agent to represent them their Agent can look after their best interests, not the seller's.   This is done with a contract between the Agent and the Buyers they choose to represent them, this is called a Buyer Broker Agreement and from this day forward this form will become mandatory for all Agents that represent home buyers.    Although this may seem like just another disclosure form in the already sea of forms a home buyer and seller must sign it and it has far-reaching consequences for the Buyer notwithstanding the cost of representation.  A potential home buyer may be forced to come out of pocket to pay for representation similar to an attorney-client relationship with a contract upfront stating how they will be paid to represent them.  If a potential home buyer chooses to use the listing Agent that buyer will not have the same representation as the Listing Agent has to look after the seller’s best interest before that of any potential home buyer.  This type of representation in California is called Duel Agency where the listing Agent represents both the buyer and the seller.  This is not legal in a lot of states so it will leave home buyers having to contract with another Agent.

The intent of the lawsuit other than the enrichment of attorneys was to allow potential home buyers to negotiate the commissions in the transaction.  This ruling missed the mark for home buyers as now they may have to come out of pocket with money for representation where before the seller has paid the buyer’s Agent.  In typical fashion, something that was spun to help home buyers will end up hurting them in the long run as it could dramatically raise the cost of buying a home.   A potential Home Buyer could now end up paying more for a home to get their Agent paid so they don’t have to come out of pocket to pay them.  If they go directly to the Agent who has the listing on the house and try to negotiate without an Agent representing them they too could pay more for the house without representation.  

All is not lost however, here at MAE Capital Real Estate and Loan, we have a solution to the problem of buyer representation.  We have been using this method to help our Home Buyers over the years and have been very successful and that is where we represent the home buyer and do the mortgage for them.   Yes, our Agents are licensed for both Real Estate and Mortgage which allows our Agent to negotiate with a home Seller for a commission which we also give a portion back to the Home Buyer for their mortgage.  In this scenario a home Buyer will not only get representation on their purchase, but they will get representation on the mortgage at the same time.  This method has proved to be far more convenient for a Home Buyer as they only have to make one call to their Agent to get information on the home as well as the progress of their mortgage as opposed to having to make 2 calls one to their Agent and One their Loan Officer.  Not only will this save them time it will also save them thousands in having to pay the new Buyer Broker it will save them on their costs of the mortgage and in some cases our Buyers get a lower interest rate as we have successfully negotiated all the fees to be paid by the Seller and we contribute some of the commission on the sale to the new loan.   In some other cases we have helped our clients Sell a home and Buy another home and we do their mortgage for them, in this case, we negotiate a far lower commission for our Seller and when they buy our contribution saves them  now on both brokerage fees as well as mortgage fees.  If you are considering Selling and buying another home this way will save you thousands and thousands of dollars when you work with MAE Capital Real Estate and Loan.  We call this service bundling which is similar to the way insurance companies work when you give them the opportunity to cover your house and cars.  Bundling Services in Real Estate now makes more sense than ever.  If you are looking for the best way save look no further than Mae Capital Real Estate and Loan.

Posted by Gregg Mower on March 21st, 2024 3:25 PM


Today’s topic might be a bit confusing to some, but rest assured if you know, you can make the right decisions with your money.  We are all seeing a tightening of money lately due to inflation which is where prices of goods and services go up faster than income does.  Inflation is the worst possible economic effect on any society as the people who are affected by inflation have less disposable income left over after they pay for housing, food, gas, and services.  In America, there is a significant amount of people that live paycheck to paycheck meaning that they spend every dollar they make on housing, food, fuel, and services every month.  When these prices go up and their income does not follow then people have to go to other sources to make those essential payments such as credit cards and this puts the average American in a deficit.  Although this is not good for the average American it is also not good for the banking system as the banks rely on the deposits of Americans so they can lend out that money to keep the banks in an income stream.  

This brings us to the banking system itself and most see the system as confusing and have no idea how banks actually work.  In America and other Western countries, the banking system is what is called a Fractionalized Banking system.  That is a big word that means that the banks can lend out most or all of the depositor’s money.  For example, if a bank has $100,000 in deposits from 5 customers ($20,000 each) and it pays 3% interest to those customers the bank then can lend out a good portion of that money at higher interest rates.  Remember that the banks have to keep cash on hand in case their customers need cash and in the past banks have held back about 10% of that money for cash.  The other 90% is lent out at a higher rate than they are paying the customers that have savings in their bank.  In our example, there is $100,000 from 5 people paying them a 3% return to keep their money in the bank.  The bank can lend out $90,000 and only keep $10,000 for cash reserves and when they lend out the money they collect say 6% on the money they lend out.  This process should leave the bank positive in income and has throughout the history of fractionalized banking.

Here is the problem with the system.  Banks currently have no reserve requirements meaning that in my example the banks can legally lend out every dollar of your savings.  This should not happen, and most banks will not lend out 100% of their customers’ deposits as they want to stay open in case there is a day when there is a heavy amount of withdrawal money.  Banks are in charge of regulating themselves based on their lending models and most banks do a good job of regulating this.  Here is the biggest problem facing the banking system today and that is inflation.  As we talked about earlier when prices go up faster than incomes the bank’s customers are spending more than they make and they do this with credit cards and equity loans.  There will come a point where the average American can no longer pay their debt due to inflation.  Human nature is to make sure they have food on the table first and foremost.  When the consumer can no longer pay their debt, they default.  This means that if Americans can’t pay their credit cards they go into default and the bank receives no money.  This holds for mortgages as well.   

This is where things start to get crazy so hang on.  Remember, that Banks will lend out around 90% of depositor’s money and if those loans start to go bad there is only 10% of cash left for banks to operate.  So, a bank’s reserves may get eaten up quickly if there is a high default rate.  Banks lend out money for Credit Cards, Residential Mortgages, and Commercial Real Estate loans and lend to other banks.  When customers start to default on their loans the income stream to the bank is greatly diminished and they still have to pay interest on the deposits they have for their customers.  If the bank has not held enough in reserves to account for this then the bank will fail.   Or as we saw in 2008 when this started to occur the government stepped in to save the larger banks not through the use of the Federal Deposit Insurance Corporation (FDIC) but actually printing money to put back into the system.  The smaller banks were bought up by the bigger banks.  In 2008 we had other factors going on to bail out the system as we were not in an inflationary time it was more of a recession meaning the economy was retracting with no inflation.  Real Estate values during this time went down the stock market sold back and there was high unemployment due to the recession.   Interest rates went down during this recession as there was no real inflation so with lower interest rates those who had the means bought homes and commercial real estate as the cost of money was cheap and this brought the economy back.  

Fast forward to 2020 when the COVID crisis hits.  This was a forced recession by the government telling people they could not work.  We had never seen anything like this in American history and the result was that the Government and the Banking system were faced with something they had never dealt with before.  The mistakes that were made have led us to where we are today.   The biggest mistake was to shut everything down that was not essential.  The next mistake was that the government did not take into consideration where we were in the business cycle with a healthy economy at the time before they shut the economy down.  The Government printed and sent out money to every American and it may have helped some in the short run the long run is what we are paying for today.   The Government also lowered interest rates to stimulate the economy and it sure did with people buying houses and freeing up equity to buy more stuff.    The money was flowing through the economy and people were buying things at a crazy rate until inflation hit people had to slow their buying habits and in addition to that the Federal Reserve saw the inflation and the only tool they had to slow inflation was to raise interest rates and they did.

Today all that stimulus money is gone, however, the government has continued to spend money by sending it overseas and starting foreign wars.  I can guess that the reason for the wars is to get the economy moving again as war requires a lot of money to flow.  We could go into the problems of this all day long, but this is not the forum for now.  The problem is, currently with the high interest rates and high inflation the more the government spends the less the dollar is worth on the world stage.   That coupled with the BRICS system that threatens to remove the Petrodollar on the world stage is further devaluing the dollar.  The banks are starting to see their default rate climb with inflation and this is diminishing the bank’s liquidity as this continues to happen, we see a tightening of the availability of money.  Today March 11, 2024, the Bank Term Funding Program (BTFP) which is a way for banks to secure funding from the Federal Reserve will be ending.  This will force the banks to go to the discount window to borrow short-term funds.   This will lead to money being tougher to borrow.  We are also beginning to see defaults start to rise and that coupled with the already tight money supply for Americans high interest rates and rising inflation it is a wonder why this is being done.  Is it being done so deliberately?  You can’t help but think there is some master plan to change the monetary system in America or to create a global currency minus Russia China, Brazil, India, South America, and countries in the Middle East (the BRICS nations).  But why?

I am beginning to think that all this stuff we have never seen before such as wide-open borders, money being sent to some foreign war nobody seems to want, money given to illegals, civil disruption, and propaganda being spread all over, is all part of a plan to make America weak.  The reason is to change the monetary system and move to more globalization that not many Americans want.  I see the UN helping in this destruction of America in that they are funding the illegal migration and to make it worse the US is the largest supporter of the UN.  I mention this not to scare you but to open your eyes to the great sellout of America and a move to the International Monetary Fund or something else, instead of the Central Banking system we currently use and enjoy independently of the rest of the world.  Before this can happen the Banking system in the US must collapse and it appears from someone who has watched and studied this for the last 45 years that this is what is happening.  I don’t want to scare people and I might be stating the obvious, but things are changing fast.  I am not holding out much hope for the Federal Reserve to lower interest rates any time soon as we still have inflation, and this is known not by the numbers the government feeds us but by simply going to the grocery store and filling up my car.  The mortgage business is the slowest I have ever seen, even worse than 2008.  This is also true for the Real Estate market and as things get tighter we should start to see more inventory hit the market as people are having a tough time paying their mortgages even if they have a 2 or 3% mortgage.  I am also seeing more people defaulting on their mortgages creating a higher foreclosure rate.  We as Americans can only do one thing to fix this crisis and that is to vote correctly, although I live in California and the system has been corrupt for decades it’s all we have to save our Constitutional Republic.  

Posted by Gregg Mower on March 15th, 2024 11:01 AM

What is going on with Real Estate and Interest rates?  This is a question that many are asking right now, including myself.  I started in the mortgage business while I was in college in the early 1980s, so I have seen a lot about the industry.  My father was in the mortgage business before me so you could say I grew up in the business.  I received my bachelor’s degree in economics and started full-time in the mortgage industry in 1986.  Things have changed over the years in the business, but the core of the business has remained the same.  When I started in the business there were no computers and everything that is now printed by a computer was hand typed and there were no fax machines or cell phones at that time either.  From a technological standpoint, there have been many changes but the way we qualify a potential home buyer for a home loan has not changed.   The Stock Market’s DOW Industrial average was around 2500 in the early 1980’s so things have changed there as we are over 38,000 today.  I have observed many changes, some for the good and some not so good but overall up to this point in my life I can say the business cycles have been pretty consistent.

What I am seeing now is something I have never seen, nor did I think I would see in my lifetime.  Like I said above the business cycles have been pretty consistent over the decades until now.   With all the economic data I see and more importantly, what I am observing is happening right now is scary.  I have always trusted the economic numbers that have been spoon-fed to us from the government until now.  Yes, I have lost confidence in the system I helped create throughout the years.  When the executive branch of our government stands in the public eye and lies directly to us I have to believe that everything that doesn’t fit their agenda is a lie and that is very sad for America.   When I hear the powers at be say that Bidenomics is working and America is thriving I have to call B.S.  We all know that things cost more than ever at the store, at the gas pump, and with housing so why is it that the powers at be say otherwise?  I try my hardest not to get into politics on this blog but is has gotten to the point that I have to bring it into the conversation as this is why the Real Estate markets are sluggish and interest rates remain high.  

My observations in the Real estate markets are that people want to buy but with prices so high and interest rates that are too high, they can’t buy.  Inflation has made the cost of everything go up and the value of the dollar goes down.  So, when prices of Real Estate should have gone down with higher interest rates and lower demand, we have seen Real Estate values stay the same and, in some markets, continue to go up.  The reason for this is that inflation has caused the dollar to go down so much that housing prices have stayed the same which means that they have gone down as inflation has eaten away the buying power of consumers.  To put in in other words as inflation makes the price of things increase it also devalues them in that fewer people can afford to buy them.   What higher interest rates should have done without inflation is to cause fewer people to be able to afford housing thus slowing the demand and making sellers of real estate have to lower prices in order to sell.  As we have observed with the higher interest rates over the last 2+ years Real Estate prices have not reduced as they should have or were intended to do.   They have stayed steady or have gone up and this is due to the inflation or the devaluing of the dollar which is the same thing.  

What is going on here, you ask?  It is pretty simple from my standpoint, but I am not sure our education system is actually teaching these concepts for the younger generation to fully understand.   To be clear, how the dollar devalues is simple economics.  The government is spending more money than ever, thus putting more dollars into the world economy.  When you have an oversupply of anything the value of that item will go down and that is what we are seeing with our US Dollar.  The national debt has risen over the last 3 years from $30 trillion to north of $34 trillion consumer debt (Revolving debt credit cards) has risen to historic highs of over $1 trillion in the US alone.  This means that every Citizen of the US bears the liability of government spending.  When we send Billions and Billions of US dollars overseas this becomes a double whammy in that there more dollars are in circulation but no benefit to the American Citizen.  Ironically a lot of the money the US is sending overseas is to protect the borders of other countries while our borders are wide open.  This poses many problems for our economy, the most obvious problem is that as more dollars are pumped into circulation the value will continue to decline, thus inflation.  You may have heard that” core inflation” has come down which we all know to be a lie, however, core inflation is the price of those goods that exclude energy (gas and fuel) and food prices which is what most middle-class Americans use the most.   When your cost of living goes up so high that you can only afford food and housing you have lost wealth and wealth potential.  

How do we get out of this cycle of lies and deception from those we used to trust to give us the truth and who are constantly lying to us?  I would say vote them out and start over, however, deception, lies, and corruption have taken over the media, social media, and the voting booth.  You see when the average citizen loses confidence in the voting system, we have lost our constitutional Republic.  When you hear that the United States is a democracy it is not, it is a Constitutional Republic, that is the kind of rhetoric we are hearing that is either a lie or something they want you to believe.  I am tired of people blindly believing everything they are told; we need some real changes quickly or our way of life we grew up with will be gone forever.  We as a nation are as close to a tipping point as ever before in our history and my fear is that with spending for foreign wars, out-of-control illegal immigration, and corrupt leadership we are very close to something we all should fear.   What we need to do is to come together to see what is happening right before our eyes and collectively do something about it.  If we don’t stand united, we will fall divided.  

To conclude, the Real Estate and Mortgage Markets are being drastically affected by the ridiculous monetary policies put forth by the current administration.  With out-of-control spending outside of our own country, cutting oil production in our country, and starting foreign wars we stand to be in this type of crazy economy for a long time without some significant changes.  My next big concern will be a crash of the stock market due to American companies not being able to profit like they have been able to in the past.  We must also watch the emergence of the BRICS monetary system that Russia and China are spearheading this could cause further inflation by the devaluing of the dollar on the world stage and if the BRICS system replaces the US Dollar as the world’s reserve currency, then we have more problems than I can write here.   This has not been covered in the media and is one of the biggest threats to the US Dollar in our lifetime.  This could also be one of the underlying reasons it seems we are marching into World War 3 to prop up the dollar.  To think how many people will die in a war so the US Dollar is protected when other moves could have been to avert this situation.   This is a very pivotal time in our history, and it seems that our media is more concerned about who’s feelings are getting hurt rather than the hard-hitting stuff we all know is going on and we should be concerned about.  So, if you are reading this I hope you understand the magnitude of what I have written and I pray it doesn’t get censored in our so-called free society.  



I fear we may have gone too far with out-of-control corruption to the point where the economy as a whole is suffering from incompetent leadership.  If we don’t get immigration under control we will have too many people trying to get the same jobs and the same housing that American-born people need.   As it is those same immigrants are getting government checks or taxpayer money to compete with natural Americans for housing, food, goods, and services not to mention that these people have not been investigated properly at the border so there may be bad people that could hurt Americans or damage property or worse we don’t know.  This is causing a higher demand for housing and the longer it goes on the more it will hurt the American people.  Crime is also rising in the cities where these migrants have gone and is getting worse every day.  

Posted by Gregg Mower on January 26th, 2024 3:14 PM

Here we are in the middle of 2023, had to believe.  This year has been one of the slowest Real Estate Markets we have seen since 2009.   We are experiencing record inflation for the 21st century of the like we have not seen since the early 1970s.  This tells us that the cost of goods and services has risen faster than most people’s income streams have.  What does this mean for Real Estate now and into the second half of 2023?

Based on the history of inflation you see the Stock markets go up due to the fact that the valuations of companies tend to go higher with inflation.  We have seen this throughout history and this time is no exception.   What you must be cautious of is when companies’ costs rise so high and the demand for those goods or services decreases thus income for those companies will also decline.  After this companies will have to lay off salary-based employees to keep up with the rising costs and when this starts to happen you will see the economy fall into a recession or worse depression.   

Inflation is such a killer of economies in many ways not just with the higher costs of goods and services but also with the availability of money with higher interest rates.  Over the last year and a half now we have seen interest rates move from historic lows for 30-year fixed-rate mortgages from the 2%-3% range to now a 7%-8% range.  What this has done is cut out a whole segment of the population’s ability to qualify for a new home loan.  In California, we have starter home prices hovering around $500,000 on average for the state.  What the higher interest rates have done is cut the people that could have qualified for this house.  For example, the payment on a $500,000 house with 5% down at a 3% interest rate is $2002.62 principal and interest at 7.5% Interest rate the payment would be $3,321.27.   At the 3% rate, an average borrower would have to make right about $7,000 a month to qualify for the mortgage.  At 7.5% the borrower will have to show around $11,500 a month.  This shows you the power of interest rates and buying power.  

That said you would assume that Real Estate prices would have to come down to accommodate the higher interest rates.  We saw this occur in some markets but not nearly enough to make up the difference. Today we see Real Estate prices staying relatively steady.  The reason for this is interesting.  Since so many people refinanced or purchased their homes with lower interest rates, they are reluctant to sell their homes as the can’t qualify for a move-up home, and in some cases, people couldn’t afford the house they are living in if they had to do it all over again.  So, we are seeing people holding on to the lower interest rates and not selling their homes as they would have to qualify for a new home under the higher interest rates.  With people not selling their homes, we are experiencing a supply shortage of homes on the market and with that low supply of available housing prices have remained steady even with the higher interest rates.  

The next hammer to fall, unfortunately, is going to be employment layoffs.  This is going to happen due to inflation and government spending that fuels inflation with an oversupply of money.  In the second half of 2023, I see consumers holding on to their hard-earned money as the average consumer feels that something is going to happen, they just don’t know what.  There are many factors that could fuel inflation, but the biggest unreported issue will be the worldwide devaluation of the dollar.  When the world drops the US Dollar as the worldwide reserve currency, all the goods we buy from overseas will cost more and more.  This is something that no generation of Americans has ever seen, the closest we got to this was the great depression.  The way America got out of that was World War 2 by producing Ships, Planes, Autos, Guns, Ammunition, and such.   The largest difference between then and now is that we produce very little in the US, we outsource to China and other countries.   History tends to repeat itself, so shouldn’t be preparing for a war?  If you are paying attention to the world and not preoccupied with all the social issues going on in our country, you will see how close we are to this prophecy coming true.  

I don’t like to be negative, and I truly believe in America and the American way of life, however, I must be a realist with what I know and have seen with history.   As the US Dollar becomes less valuable in the world markets this will cause further inflationary pressures on our economy.   The only way out of this at this point is to figure out a way to re-set America’s debt to the Central Bank or get rid of the Central Reserve Banking system altogether and start with something new.  How this could be done I would not know, but I do know it will be a very painful process to every American.  With the BRICS nations and a new world reserve currency on the horizon, America is going to have to do something fast, very fast as that is supposed to launch in August of this year, and over half of the world’s nations have agreed to sign on this new asset-backed currency.  Our central Bank is going to try and compete with this with a new Central Bank Digital Currency (CBDC).  The problem with this is that even our own citizens don’t like the idea of this as Americans don’t like the idea of being watched or controlled in the name of some made-up government issue like climate control.  For more on this please I urge you to do research on this as this CBDC is supposed to come out in July of 2023.

What will a CBDC do to interest rates, housing, and inflation?  This is something that remains to be seen but rest assured it will be a rocky ride going into the end of the year.  I always say if you can own Real Estate do so as Real Estate will have value.  I believe that once people see the changes happening there will be a flight to quality investments like real estate.  I will bet the Stock Markets will struggle, to say the least.  Interest rates will be dependent on how much inflation we have as interest rates will rise as inflation rises.  So, if you are looking for advice as to when to buy Real Estate my advice would be to buy as much as you can now, if you can find it, and hold those properties that you hold currently.  Keep an eye on the world and what is going on, and research other sources other than your mainstream media that most of us have grown up on as we are not being told the truth to keep the masses under control for as long as they can.   Not that one individual can do anything, but the power of the masses can make changes.  

Posted by Gregg Mower on June 1st, 2023 11:02 AM

We are now 4 months into this COVID-19 crisis and people are getting very restless. People that reside in US Cities are feeling a bit confined with their current living conditions. If you live in a city you know what I am talking about. From having to wear a mask literally everywhere even outside gets old after a while. Not to mention if you are one who lives in a high-rise Condo or Apartment complex you must wait for an empty elevator or take the stairs with your groceries. When sheltering in place in your space you are breathing other people’s recycled air in those high-rise complexes and people are worried for their health and the health of their family. Not to mention most big cities, especially in California, have large homeless populations and the city streets are dirty and unsafe. As more big cities move towards the idea of defunding the police this is also getting people extremely nervous as most big cities don’t have enough resources currently to keep their citizens safe. In addition, in California, the Governor is releasing dangerous prisoners into our cities at an alarming rate under the guise of protecting the prison population. At MAE Capital Mortgage Inc. for these reasons, we are seeing what we are calling "The Great Migration Out of Cities". 

That said people are heading to rural Northern California in droves.  MAE Capital Mortgage Inc. has offices in Rocklin and Roseville and since we do both Real Estate Sales and Mortgage Lending, we are seeing this very interesting dynamic with people able to work from home and embracing the fact that they can now live anywhere.   There are more people with the desire to move out to the country where there is room to move about freely and can have outdoor space for there kids to play.  My wife (Margie Mower) who is one of Rocklin’s top Agents is remarkably busy with buyers wanting the rural properties.  She specializes in rural properties in Rocklin, Roseville, Loomis, Penryn, Newcastle, and the foothills.  When she lists a property in a rural setting the price of these homes are between $650,000 and $1,500,000 and she is getting multiple offers as soon as they hit the market from people seeking shelter away from cities.  She is hearing that the restrictions and the unrest in the cities are driving people away from the cities.  With Politics running rampant in cities where large concentrations of people reside the average citizen has become scared of the movements to defund police and the encouraging of violent protests so much so that they are seeking a slower and easier way of life away from the unrest in the cities.  The Governor of California is even moving out from Sacramento to El Dorado Hills which resides in the foothills of California about 40 miles from Sacramento.  He is buying a $5.4 million on a Governor's salary during a time where his assets are allegedly all in a Blind Trust not for his use.  Whatever your politics are I will bet you too would rather live in a safe environment without homeless, violent protest, filth in streets, and closed businesses.    Schools in rural areas have been allowed to open as the Health Crisis is less concentrated in rural areas which is appealing to city dwellers with families.  

If you are wondering where the people in the rural areas are moving to, it might surprise you to know that the majority are headed out of state.  Yes, with the turmoil, and over-taxation, and an environment where businesses’ small and large are being looked at as part of the problem and not the solution it is no wonder people are leaving.  California has another misleading ballot measure that, if passed, would repeal Proposition 13 (The Howard Jarvis Bill) and property taxes could rise to an amount that will push down real estate values.  The Ballot measure is disguised as an education measure, but if this passes it would give the State an open opportunity to raise all property taxes on both residential homes and commercial property.  This could be disastrous and push Cities like San Francisco and Los Angeles into further decline and more people leaving to seek cheaper housing.  California is in a bad state currently with more people leaving than coming into California and it is all due to the current state of politics in the state that is running it's cities and businesses into bankruptcy and decline.   It is obvious to us the trend and the attitude of buyers and sellers as to what their motivations are with what is going on in the world. 

The world is an ever-changing place and with the health crisis that continues to give juice to the mainstream media and their fear machine, it is no wonder people want out of confined unsafe spaces like big cities.  RV sales are also hitting all-time highs as people look to escape the mismanaged cities in California.  Education and the thought of continuing to home school your kids is also playing a part in moving to rural areas in California where they are more apt to open schools first with smaller population sizes.   As rural Home specialists, we are here to help if you are looking to remove yourself from a City and move to the quiet rural areas of California.  We are also here for those that have been living rural and have found it time to leave the Golden State, we can help sell you home quickly.  If you are seeking to buy or sell a property with a well and septic system (common on rural homes) we know who to call to inspect these properties and how to educate you with the new country lifestyle.   We have many people that are making long-distance moves so if you or someone that you know needs our expertise give us a call.  www.maecapitalcom 916-672-6130. 

Posted by Gregg Mower on July 22nd, 2020 10:44 AM


When you need a home office but don’t have space for it, there are a few options you could consider: look for a larger home, build an addition, or increase your space by converting your garage. A garage conversion is the easiest and most affordable of these options, and it has the potential to become the workspace you’ve always dreamed of.

Picture Your Perfect Work Space

Whatever your garage may hold now, think of your garage conversion as a blank slate. You’ll have to empty your garage anyway to make the space livable, so go ahead and picture it as empty — but full of possibilities. If you do have a garage full of stuff, renting a storage unit is an affordable and easy way to store it all off-site. In Rocklin, the price for a self-storage unit over the last 180 days has been about $131.41 on average. When you consider the cost, think of it this way: renting a storage space takes the worry out of what to do with your stuff, and it’s way cheaper than renting a “traditional” office space.

With a clean space to work from, you can then come up with a plan to meet your needs. Ask yourself how you can maximize this space. Do you want it to be a multi-use space that can double as a guest retreat or family room? Or, do you need it to be a dedicated office space? Think about your work routine too, and in specific terms. For example, says to ask yourself what type of work you’ll be doing, whether you need space for guests, what kind of storage you’ll need, and whether you’ll do video conferences or conference calls. 

Along with the functionality you need, don’t hesitate to give your plans a personal touch. You aren’t in an industrial office building, so there’s no need to go all gray — unless gray is what you like!. We love these design ideas from House Beautiful, including decor that borrows from nature, bold colors, vintage and modern elements. This is your space, so it should inspire you.

Put Your Plan Into Action

Once you have a plan for how to set up your space, the next thing to consider is how to make it happen. Garages aren’t exactly built for comfort, so it will take some work to bring it up to livable standards. This part may require the help of a contractor because it will require construction and possibly also electrical work. Here’s what you need to consider.

  • Insulating Walls: If your garage is drafty, you may want to hang drywall and add insulation. Be sure to insulate the ceiling too so that heat doesn’t escape. You will also need to decide whether to keep the garage door or replace it to enclose the room. One option that’s ideal for letting more light into your office is to replace the garage door with floor-to-ceiling windows.

  • Heating and Cooling Systems: If you live anywhere other than a perfect climate, you’ll need a way to keep the room comfortable. According to the Spruce, if you have an attached garage, you may be able to extend your home’s HVAC system easily. Otherwise, you can consider independent systems, such as electric baseboards and a portable air conditioner, which you can find at retailers like Home Depot.

  • Flooring: Flooring is one element of your garage that’s more than just functional — you also want it to have a certain look and feel when you’re converting the garage into a room. An affordable and easy option is to lay laminate flooring. If you prefer carpet, the blog Garage Remodel Guides gives a word of caution about moisture, but choosing indoor/outdoor carpet can be a good solution. If you like wood floors, it’s recommended that you go with engineered flooring over solid hardwoods because engineered floors withstand moisture better.

The ultimate goal is to transform your garage from a space that’s cold and industrial into a room that feels warm and homey — and inspires productivity! After all, working from home gives you the opportunity to love where you work. So, why not make this space into exactly what you want for ultimate comfort and productivity?

Photo credit: Unsplash


Natalie Jones

Posted by Gregg Mower on January 14th, 2020 3:41 PM

What is the difference between the Large National Chain Real Estate Companies and the local mom and pop Real Estate brokerages?  The traditional thought is that if you list your home with a “Big Box” Real estate firm your home will have more exposure to more potential Agents that can sell your home.   But is this actually true anymore with the internet playing such a big role in real estate sales and marketing?  Can a small company compete with the “Big Box” real estate firm, or can they not only compete but beat them out in service and price?  The answer is not only can the small Local Firms compete but in most instances,  they can react faster to a changing markets and provide a better service at a more affordable price. 

 To prove this let’s first define what a Real Estate Agent’s responsibilities are.  There are 2 basic functions of a Real Estate Agent or Realtor (An Agent has to belong to the National Association of Realtors to be able to be called a Realtor) and those functions are representing buyers of real estate and or representing sellers of real estate.   When representing a Buyer an Agent must act in the buyer’s best interests and when working for a Seller the Agent must look after the Seller’s best interests.  It is possible to represent both but when doing so Real Estate law dictates that the Agent must look after the Seller’s best interests first. These functions have no relation to whether an Agent works for a large firm or a small firm, the law is the law.   

An Agent that works for the “Big Box” firm will generally be working there for one of three reasons and none of which benefit you the client.  One; they are new and work there to gain more information or are in constant training.  Two; they have a friend that works there. Or three; they believe that the name recognition will benefit them in their personal career.  I ask, does any one of those reasons benefit you the buyer or seller?  They will tell you that they can pitch your house to all of the Agents that work in their office and that might sound good to you but ask the Agent how often he or she is actually in the office and the answer might surprise you.  The Agent that works in the smaller firms actually gets more hands-on experience and has access to the Broker directly on a daily basis to get his or her situations handled quickly.

In today’s Real Estate world everything an Agent does revolves around the internet.  An Agent no longer has to go to the office to “pitch” their listings to their colleagues as their colleagues are all connected to the internet as well.  In fact, as an Agent today, we all have to go to the same internet source to see newly listed houses, and that is the Multiple Listing Service or (MLS) which is now done all on line.   The MLS is syndicated with many other internet Real Estate Search Platforms such as ,, Zillow, Redfin, Tulia, and many more.  In the “good ole days” the MLS was published in a book and Agents depended on other agents telling them what was on the market.  This is how the business was done for years until the internet came along and changed everything.  There is still this belief in the minds of many consumers today and that is why there are still “Big Box” Real Estate Firms.  An Agent working for a small Local firm will have all the same tools available to an Agent that works for a large firm but will be able to work for their clients more efficiently with less overhead.  In fact, all Agents that have access to the MLS are members of the Local Real Estate Board, the California Association of Realtors and the National Association of Realtors whether they work for a large or small firm.

Another aspect of Real Estate that has not changed is the commission rate charged to sell a house.  Astonishing enough the standard rate to sell a home is still 6% of the selling price of the home.  I am not downplaying what an Agent must do and maintain to be able to sell your home, I just think the concept of 6% is just a bit out of line.  If you are trying to sell a $600,000 house and you list it with a 6% commission with a Big Named Real Estate Firm you will have to pay $36,000 in commission.  What do you get for that you ask?  You get an Agent that will put your home in the computer (MLS) and put a sign in the ground and will hold your home open several weekends for potential buyers to see.  You also get the professionalism of a contract that will be written to a high legal standard.  Your Agent will have to go over any work requests of the buyer and work with an Escrow on your behalf.  This is what an Agent will do for your no matter if they work for a large or small firm.  Your 6% helps pay for that nice “Big Box” office that you will probably never go in.  A Small Frim will have the ability to make that number a whole lot less offering the same services and some cases the small firms have more local contacts as they have been local longer.  When you sell your house, it is all about exposure whether it is a Million dollar house or a fixer-upper, as a seller you need to look for experience and someone you can trust and hold accountable and knows the local market. 

As a Buyer of Real Estate, the commission your Agent gets doesn’t really matter to you, as it has been pre-determined prior to the house coming on the market, or does it?   When looking for an Agent to represent you as a buyer they need to know the local market, have knowledge of financing available, understand the local closing costs, and understand how to research properties.  Although, the commission that is paid to them is truly not your concern as the seller pays the Buyer’s Agent but what your agent does with commission is.  Most “Big Box” Agents have no say in what they can do with the money they receive when representing a buyer, an Agent working for a small firm can chose to give back some towards closing costs, work items, warranties and title costs.  At a minimum a good buyer’s Agent should pay for a home warranty, that insures the buyer if there are problems with any of the major systems of the house in the first year or 2, they have a warranty that will fix those issues with little or no cost to the new home owner.   This, however, is not legal for an Agent to advertise as is goes against the Real Estate Settlement and Procedure Act or RESPA to tell a potential client that.  So it is always a good idea to establish what they will pay for you, on your behalf upfront, but you have to ask them they can’t say “if you use me I will pay for X” that would be a violation.

The newest type of Brokerage is a Hybrid Real Estate Agency, a Real Estate Brokerage that also can arrange your Home Loan and bundle all the services into new low cost package.    Now the smaller local shops, like MAE Capital Real Estate and Loan, can offer all the same services as the their “Big Box” Competitors, but they also have the opportunity to offer more.  The listing and selling of homes is an art and you want a person that knows this and has the experience to do so on your side.  At MAE Capital Real Estate and Loan our Agents typically have far more experience than those in the “Big Box” shops.  This experience also allows us to provide multiple services to our clients such as standard financing options for homes as well as private money options.  We have found that being able to show the Sellers and the Buyers how they can save money by bundling the services they need to sell and buy homes proves to be invaluable to them.     At MAE Capital Real Estate and Loan your home is marketed on the MLS, on our site,, Zillow, Tulia, RedFin and 70 other sites along with social media, and if you request your home can have its own page with video and all the interactive bells and whistles.  As a Hybrid Real Estate Firm, we find homes for our buyers that fit their needs, and yes we are “Realtors” (belong to the National, the California, and the local Association of Realtors), in addition to that we can also qualify our clients for their mortgage and provide them financing.  We will also screen potential buyers in ways our competition cannot.  This ability to offer more services not only benefits our clients in the time they save to find out if they can sell their home and buy another home, it also saves them thousands of dollars.   Take a typical seller of a home, they have to find an Agent to list their home as well as find a Loan Officer to see if they qualify to purchase their next home.  As a smaller shop we can do all this at the same time for you with one call to one office to get multiple answers. 

Let’s talk about cost now, as that is the most important part of all this.  Remember the typical Commission on Real Estate is 5-6% (2.5%or 3% to the listing Agent and 2.5%or 3% to the Selling Agent respectfully).  What if you could get away with 3-4% or even less in some cases would you do that?  Of course you would, as you know you will get exactly the same service, or better in most cases, and reach the same or more people for far less money.  One more thing, the cost of your loan will be less as we don’t charge you any fees for your loan.  That’s right as a Broker we go and find you the best rates for your situation.  As a Mortgage Broker with a long history in the Mortgage Business MAE Capital Real Estate and Loan has sources across the country that can fund your loan.  Also a little known fact, as a Mortgage Broker, we are limited on the fees we can make, and we receive wholesale rates (lower than retail rates) and pass those low rates on to you.  In addition, our Agents must hold both a California Bureau of Real Estate license and the Nation Mortgage Licensing System license (NMLS).  So what you end up with for your loan is a lower interest rate and a no fee loan transaction.  As we are bundling these services we can lower your cost of all them, thus saving you thousands of dollars upfront and a lower monthly payment than you could get going to a Banker.

So let’s recap the differences between Large and Small Real Estate Firms.  A large firm has high overhead, Agents that are there for selfish reasons, and they don’t do the mortgage portion of the transaction, and expect higher commissions.  So a small Hybrid firm like MAE Capital Real Estate and Loan (selfish plug) has low overhead, Agents that value their customers, and sincerely want to help them with the costs, can do the mortgage portion, can bundle services to make the cost significantly cheaper for their clients, and generally have more years of experience, and hold both a BRE and a NMLS licenses.  It is still your choice on who you pick to help you with your real estate needs, but now you have the facts about the differences between a small real estate firm and a large one.   I don’t want you to be underserved and over charged as you can see this can happen quickly in the Real Estate world.  We would be happy to sit with you and show you how this works and the consultation is free, let’s get going today.  To talk with an Agent click here, For Employment inquires click here or Call us at 916-672-6130

PS.  Further proof of how Box Box Firms really are not in your best interests.  We had a listing that was priced really aggressively to get a bidding situation going at the seller's request.  We had one offer come in significantly over the listed price but upon inspections during the contingency period that buyer decided the house was not for them.  Then a hot- shot Agent from a Big Box Firm submitted the next best offer at a lower price with no contingencies (meaning that they were to take the house as it sits with the inspections we provided) and promised to have the earnest money deposit (EMD) in within 3 days of acceptance.  Every day for 10 days we were promised the Deposit would be in and that the clients were in Hawaii and would get to it when they could.  Then 10 days after the Deposit should have been in escrow we get a cancellation from the Agent from the "Big Box Firm" with no call back.  This goes against ethics in Real Estate, so we called the Agent's manager from the Big Box Firm at 3:00pm and left a message and no answer or callback.  Before that trying to get a name of a manager was a chore as it is not published on their site at all.   In addition, this particular Agent was part of a "team" within the Big Box structure which can be confusing to clients, so watch out for the "Team Concept" within a Big Box firm as it is an attempt to hide from accountability.  If you choose a an Agent from a Large firm see if you can find who their broker in charge is prior to engaging.  The "Big Box" firms and those Agents that work for them appear to be insulated from ethics (In some cases) of Real Estate, which I find appalling.  I believe that an Agent should have all parties interests not just their own, in fact, Real Estate law states specifically that the Agent's have to look after the seller's best interests first.  Just one recent example of many.    So Buyer Beware.   

Posted by Gregg Mower on March 14th, 2018 4:26 PM

Wow, the DOW Jones Industrial Average is over 23,000 and to think just 10 years ago it dipped to 8,000.  If you are invested in the Stock Market, chances are you have done pretty well.  So, when is the right time to take money out of a hot Stock Market and invest in Real Estate?  My contention is any time, as Real Estate over time has outperformed the Stock Market in many ways.   I know it is tough to give up those double digits gains in your stock investments year after year, but as you know there has not always been those gains and when you take out management fees on mutual funds and 401ks you might only have only had single digit gains or none at all.  Not to mention unless you are invested in income producing stocks (stocks that pay a dividend) you generally have just realized equity gains or value increases.  Real Estate has also seen double digit gains but the difference with Real Estate Investments are that you also receive rents, so you have appreciation as well rents received. 

Every Financial planner will tell you that you need to be diversified with your portfolio, but what exactly does that mean?  Well simply put you should have investments in the Stock Market, Real Estate, Gold, Bonds, etc..   When you find yourself too heavily invested in one area you should spread out your wealth.  If you can devise a way to sell some of your stocks that may have seen the bulk of their gains and are poised to have a correction and turn around and buy Real Estate, I think when the correction does come to the Stock Markets you will already have the hedge with Real Estate.  When the Stock market corrects money tends to move towards Real Estate.  If you are prudent and can see ahead, you will profit greatly when the correction does happen. 

So what type of Real Estate Investing is for you?  Most people know single family homes as they probably own one as the house they live in.  But there are many other types of Real Estate Investment.  Of course, you can invest in single family homes, but don’t throw out the possibility of investing in multi-family homes, Commercial property or even Notes.  Single family homes are pretty straight forward in that you have one home one renter pretty easy to take care of.  The only downfall is that when that renter moves out and you have the downtime to find another renter and fix up the damage from the previous renter.  With Multi-Family homes you will still have income, however, if one renter moves out you have others still paying so you are still receiving income.  In addition, with multi-family properties you generally get more rent per square foot over time.  The Percent of appreciation you receive will vary from location to location on any property.  With a commercial property you generally have better rents and better lease opportunities such as triple net leases where the renter(s) will pay their portion of taxes and expenses on their space.  With a commercial property you get a different kind of use than that of a single or multifamily dwelling.  You might have a retail building with shops that are only open during the day, or an office building that the tenants must keep up for their clients, or a warehouse, all of which bring in good rents but are very different in the up keep and maintenance and the ability to have the tenants pay for it.  

You have to ask yourself if you are getting all the return on your money that is possible.  If the answer is no then you should look towards Real Estate.  It is a fact that the wealth of the top wealthiest people  in the world have huge Real Estate holdings.  Starting your investing in Real Estate can easy, first you have to come up with a budget for purchasing Real Estate.  Unlike Socks (generally) you can leverage Real Estate to get the most for your money.  As an Investor you don’t have buy property outright you can get a loan against it allowing you to purchase more thus leveraging your investment dollars.  Investors should obtain an operating statement from the seller when purchasing commercial properties as you need to know what the income and expenses are of a property before purchasing.  Then you can apply your new tax base and your loan expenses and get an accurate income estimate of the property prior to purchasing.  This is far easier with a residential Single Family investment home as you will know what the expenses are prior to purchasing as the renter will pay for their own utilities and maintenance, you will have to pay taxes and insurance which you can estimate pretty close prior to purchasing.  One more thing you have to ask when placing investment dollars is when will the next correction be in the stock market and can you weather that storm before it comes back.  Here at MAE Capital Real Estate and loan we love to help investors obtain investment property as well as helping them finance those ventures. 


Posted by Gregg Mower on October 31st, 2017 3:35 PM

Most people think when you buy a new home in a brand-new subdivision you can’t use your Realtor.  This is a myth; most major builders will co-operate with outside agents to get their inventory sold.   This will help you as a buyer in that your Agent is driven to work for you not the builder, whereas the sales agent in the subdivision is looking out after the builder’s best interests not yours.   Having representation with your own Agent will not cost you anything as the builder will pay your Agent at the close of the sale.  It most cases, your Agent will be able to better represent your best interests in getting the best base price and will have the ability to negotiate on any improvements you might want. 

It is very tempting to just stop into a builder’s sales office and look at the model homes they have staged to view.  When or if you do this, you should tell them you are working with an Agent even if you are not.  This will allow you time to get representation to negotiate the best deal possible.  Communication with your own Agent will be far easier than trying to deal with the sales Agent that works for the builder as they don’t have the incentive that an Agent working for you would have to get the answers back to you in a timely manner.   Real Estate Law states that an Agent must look after the seller’s best interest first, except if a buyer designates an Agent to work exclusively for them. 

Your Agent can generally provide you with more information on the project than the sales Agent working for the build can or will.  A good Agent will be able to tell you the dynamics of the neighborhood and surrounding area better than the builder’s Agent as they don’t have any incentive to know what is going on around the builder’s project, they are there to move units like a car dealer.  If there is a Home Owner’s Association (HOA) your Agent should be able to get you good information on what it pays for and what the goals of the association are.  An Agent will also be able to take the time to research the schools and if there any new schools coming to the area and when they will be opening.   Your Agent will have the time to devote to you to research school bonds, Mello Roos,  and other items that may affect your payment when purchasing a new home. 

If you have never purchased a new home before you will notice that the model homes have tags on several items in the homes that may say “optional” or “upgraded item” these items are not included in the base price of the home.  Potential home buyers will sometimes miss these items and expect them to be in the home they purchased when it is completed.    Then when it becomes time to do the walk-though they are not in there and this can bring confusion and disappointments to new home buyers where if they had representation their Agent would have known to put those items in the initial contract.  These upgraded items can raise the price of a new home significantly so it is important that you know exactly what the end price will be with all the upgrades you want.  MAE Capital Real Estate and Loan’s Agents know how to negotiate for these items for you and you would be surprised how much money you can save by having that representation.

You will also see that when you are dealing with a builder’s sales Agent that they will steer you towards their lender in the form of giving you incentives to use their lender as opposed to an outside lender.  This is an illegal activity specifically called steering, however, they still do it.  At MAE Capital, we have a system that will be able to work around the builder’s lenders, in most cases, and still get you the best interest rate and the lowest costs even if the builder is offering $10,000 in incentives to use their lender.  This actually works in the form of “Bundling” our services.  We have proven this to work and save our client’s money and maintain control over their own transaction.  This helps our clients in that they only have to make one phone call to find out about the house and the loan.  This not only saves time but will save thousands of dollars.

To recap, when looking to purchase a New Home in a New Subdivision you should really try to have your own representation.  This will work in your advantage in many ways.  You will, generally get a better price with the upgrades you want, you will get more financing options, you will get more knowledge of the area and feel more comfortable that you have someone working for you towards the purchase of a new home.  Your Agent will go through the walk-through with you at the end and if anything is not up to your standards your Agent can deal with it for you with the builder directly.  This is a big undertaking so if you are looking to purchase a new home in a new subdivision you should get some advice from a professional Agent prior to making an offer to purchase and you could be saving thousands of dollars just by having a conversation that doesn’t cost you a thing.  Here at MAE Capital Real Estate and Loan we are here to help guide you through this process and save you money.  Give us a call today at 916-672-6130. 

Posted by Gregg Mower on July 24th, 2017 10:14 AM

After one of the rainiest winters on record the sun is finally shinning and you are thinking it is time to put your home on the market.  So you ask, Is it time to sell your home?  For everyone that realization comes at different times.  Maybe you just got married and its time to sell that bachelor or bachelorette pad.  Did you have another child and don’t have enough rooms.  Has your company decided to relocate you?  Do you just want to move up?  Kids out of the house and want to move down?  Whatever your reason is you have come to the conclusion that it is time to sell.  Now what? Can I sell it myself or do I need a Real Estate Agent to help me and how much that will cost me. 

 These are typical questions that most everyone has had when they decide it is time to sell their home.  So let’s discuss the purpose of using a Real Estate Agent and the cost of using one.  It has appeared to most sellers that they could probably put a post in the ground and put the listing in Zillow and sell their own home.  What they have not thought through is how to show the house when they are away, and do the legal paperwork for a potential buyer.  In addition, they may not have the ability to accurately figure a price to put on their home, and if they have come up with a price, will it appraise.   Then there is all the legal aspects of selling a home in today’s world, and are Sellers up to date on what they must provide to a potential buyer by law?  If these are questions you are having then you will naturally look to a Real Estate Professional for help, but who and how much will that cost?

A typical Real Estate commission is between 4-6% plus fees, you may ask yourself “what am I actually getting for that fee?”  The truth is, you are buying piece of mind that your will house will sell and you will not be liable for it once it is closed and you have good proceeds from the sale.  A good Agent will not only give you that piece of mind they will be able to map out how the transaction will go before you even put a post in the ground.  At Mae Capital Real Estate and Loan our Agents have the experience in both years in the business also in the volume of transactions seen in those years.  What our experienced Agents will bring to the table is a team of professionals that are proven in their field whether that is in lending, Title, appraising, or legal.   Not to mention we have been consistently selling home for at or higher than most seller’s expectations are.  

A good Agent will pay for themselves multiple times over in time savings and negotiations.  It starts with the initial marketing of your home or property.  It is like the difference between buying a used car from a dealer or a private party, which one do you feel would stand behind what they just sold you?  That’s right, a dealer, as they will stand behind their product and have a team of mechanics, lenders, and support staff, so you pay a little extra for that piece of mind.   The same applies in Real Estate, as most buyers will feel more comfortable with a team of professionals that will stand behind their work other than an unlicensed person trying to sell their home by themselves.  It is proven that a potential home buyer will pay a little extra for the peace of mind that comes with professional help.  Generally, a home buyer will pay up to 10% more for that peace of mind.   So when we say that “having an Agent represent you will pay for itself”, we are not kidding, it does.  So that covers the argument of an Agent costing the seller more, to add to that, if you were to have a lawyer draw up a contract it would cost you considerably more money, but an Agent covers that cost as well.  If you were to forgot to disclose something upfront and the buyer sued you after the sale that would cost you exponentially, an Agent will assure that you won’t bear that cost.  Your Agent also bears the costs of marketing your home.  At MAE Capital Real Estate and Loan we get your listing out to the MLS so other Agents see your home listed but we also get the house listed on Zillow, Redfin, and over 70 other search engines that potential buyers will be looking at. 

Now that we have rationalized why you should be represented by a licensed Real Estate Professional lets figure out what comes after that.  Your Agent will help you to prepare your house for sale, offering showing ideas and how to stage your home for sale.  If you are selling your primary residence you should have your home inspected by a licensed termite inspector before listing the home so you know what might come up from a potential buyer. Most buyers will ask to see a termite report when they make an offer to purchase your home, so if you have it done in advance your home will become more attractive to potential buyers.  Spruce up the yard, your Agent will tell you that “curb appeal” is important to buyers that may be driving around looking at houses.  Remember, if your home makes a good first impression to potential home buyers it will generally sell fast and at a higher price and it doesn’t take much to make your home appealing to others. 

The inside of your home should ready to show, as well.  This is a little trickier, as you are living in the home at the same time you are trying to sell it.   A good idea will be to ask your Agent what you should do to the inside of your home to make it more attractive and stage it for potential buyers.  This process may be a simple as de-cluttering your home of personal items or a complete make over.  If you are person that has collectables and like to display them for your family and friends you might want to pack those away to make the house look less busy.  You have to remember that you are not showing your house off with all your things, you are trying to sell it without your things in it.  Homes always look better without personal affects in plain view, so take down your family pictures and collectables and pack them away for your next home.  Look in the kitchen, all those appliances that you love to cook with that you leave on the counter, store them away, you probably don’t use them every day anyways.  Bedrooms, probably the hardest thing to keep show ready, but it is important.  You should get in the habit of putting your clothes away every day, go to the kid’s rooms and get those clothes of the floor every day.  Again, take down personal affects like pictures and fill in holes in the walls, paint them if necessary.  Potential home buyers want a “fresh” feeling when they walk into a home that they are planning to live in, so get rid of anything that is not essential, remember you already made the decision to move so start the process of packing your stuff you don’t need.  Clean the windows, that may sound obvious, but you would be surprised that is one of the most overlooked items.  People want to see though clean windows even if the view is of the house next door.  If you don’t feel comfortable “staging” your home, ask your Agent, or call in a professional stager and they can be honest with you on what you should do.  It won’t cost a lot of money preparing your house to sell, it will mostly take your time and energy.  It is worth it I have seen houses sell for top dollar by just cleaning up and make a house feel “fresh”.

Now when it comes to marketing your home, your Agent will most likely have that handled.  Your Agent will, at a minimum, put your home into the Multiple Listing Service (MLS) so other Agents can see it is for sale.  At MAE Capital Real Estate and Loan we will not only do that for you but we will build a personal website for your home and syndicate that website to over hundreds of different search engines like Zillow,,, Trulia, Redfin, and many others.  In addition to that, we will make sure that we have an open house schedule pre-set, if you want those.  Putting a plan together is very important to do upfront so you know what is happening at all times.  You should also be pre-approved for a price on your next home, so you can plan you transition smoothly.   You will also need to know what you will “net” from the sale of your home, so you know how much money you have to work with for the purchase of your next home.  These are the necessities to know when you are selling a home.  Without the proper guidance, your ignorance could cost you thousands of dollars.

This article may have brought up things that you may not have thought of and I hope this has helped you with the rationalization of having proper representation when selling a home.  Over the last 30 plus year I have been in this business I have seen sweeping changes to the industry.  In the last 7 years alone I have seen more changes than all the other years combined.  So if you have sold a home by yourself in the past and think you know how it is done, you may need some help to know the new laws.  There are also potential buyers out there in today’s world that would love to prey on unsuspecting sellers.  I have seen this happen too many times where I have had to come in and fix a big mess at the seller’s expense where that could have been avoided from the start and they potentially could have sold their home for more money and less costs.   So we would love the opportunity to give you a free value estimate of your home and show you how to sell your home.  If you are looking to sell your home please talk with one of our qualified Realtors.  Call us today at 916-672-6130 or click here to email us your questions.


Posted by Gregg Mower on March 15th, 2017 11:38 AM

Should I get a Home Inspection done on the home I am buying?  Should I get a roof inspection? Should I get the pool inspected? These are just a few common questions we get from our home buyers in this competitive Real Estate Market we are in.  My answer, as the Broker of record of MAE Capital Real Estate and Loan, is yes and in most cases a hell yes.  Although, we are in a market where there are more buyers than there are sellers, making it very comparative when making offers on homes. As a buyer you should do everything to make sure you are protected.  Your Agent may tell you that there are multiple offers on a house, and that the seller will only take “as is” offers.  That is good information, but unless you are prepared to do work on the home you are about to purchase you should make every effort to know all you can about the house you want to buy, before buying it.   The simple reason is; that if you waive your inspection rights and you buy the house, then find out that the only reason the house is still standing is because the termites are holding hands, at that point your investment may not only be gone but you may have to spend thousands upon thousands more to fix the house to make it livable.  There was a great movie that came out in the 80’s called the Money Pit with Tom Hanks and Shelly Long that comically illustrates this.  In the real world it is not really funny if you get stuck with a house like that. 

The minimum inspections I recommend my clients get when they are purchasing a home are; a termite report, a roof report/roof certification, a home inspection, and if they have a pool an inspection on the pool.  These basic inspections not only tell what is wrong with the home currently you will find out what could go wrong in the near future with the house.  As a Broker, I want to make sure my clients have all the information on the house prior to them closing escrow.  These inspections are referred to as transaction contingencies in the Contract.  We call them contingencies as the contract is contingent upon these inspections and escrow can't close until the buyer has completed and accepted all the inspections within a specific period of time.  We even have a contingency release form that we make the buyer sign if they have asked for the inspections and they have been done and are satisfactory for the buyer. 

If an Inspection comes back with work recommendations, we go over this with our clients to see if they can live with the problem(s) stated in the report, or if they wish to ask the seller to repair the items before the close of escrow or some combination of that.   When this is done during the contingency period the negotiations start all over again with regards to everything in the original contract, such as sales price and all the terms and conditions of the original contract.  So a buyer should be informed of all the circumstances when going back to a seller to ask for work to be done, such other offers and market conditions.  It is our job to help guide our clients through this maze so they can make informed decisions.   

If a home buyer decides to take the home “as is” they may not be entirely stuck, as the inspections will come with warranties, for lack of a better word.  For example, a Termite Report might be clear, but the Roof Inspections came back with a low life expectancy and they recommend that a new roof be installed.  This simply means that the roofer will not warrant the roof for the years we asked and if that is acceptable the buyer then may go ahead and release contignecies, as the Termite Report is warranting the structure to be clear from active infestation and dry rot.  But if all the reports come back with major work to be done before they would warrant the home, then unless you are prepared to fix the items yourself, at your own expense, you might want to back out or make another offer to purchase. 

If the home has items that you are not familiar with such as a pool, we recommend that you have this inspected by a professional that can stand behind their inspection by either a warranty or something similar.  Pools have useful lives like roofs where the plaster or pool bottom may need replacement, or the pumps, lights etc..  A good inspector can give recommendations of life and cost to fix if they were to go bad.  This information is good to know as a potential home buyer, as you know before you buy what it will cost to fix if something does go wrong.  These extra inspections cost the potential home buyer money prior to closing but they can save the buy thousands of dollars by simply knowing what things cost to fix. 

Buying a home without these basic inspections is like walking into a lion’s dens blindfolded. You just can’t know what you are getting yourself into unless you are a licensed contractor and even then most of the contractors I know get a basic termite report before buying as they don’t know about the bug side of a house.  As a Real Estate Broker here at MAE Capital Real Estate and Loan we make sure our clients know this before going out to look at homes.  If our clients wish to buy “as is” properties with no inspections, we still disclose everything we know and what the seller knows about the property prior to making an on offer on a house.  We also make the buyer sign a form that they have been told that we strongly recommend these basic inspections.

If you are contemplating not getting inspections on a home you are looking to purchase, I would strongly recommend against that. For many reasons as stated above, but if it is the costs that are hindering your decision I would say that a dollar spent today could save you a thousand dollars in the future.  As with anything left unattended to it will grow to be a bigger problem in the future.   If you had the opportunity to know that you had cancer today in the beginning of the problem and had all the chance to fight it, but it might cost you to find out would you?  Or would you let it grow and deal with it in the future when it has a real possibility of killing you.  The same thing applies to a house, if you have termites today and the cost to fix it is $1,000 but if you waited a year or two it might end up costing 10 times that amount.   If you would like more information on this or would like to discuss a problem, you are currently going through, I would be happy to discuss it with you.  Give us a call at 916-672-6130
Posted by Gregg Mower on May 5th, 2016 8:09 PM

It is that time of the year where the kids are out of school for summer vacation and Parents have the get-out-of-town blues.  This time of the year we have traditionally seen Real Estate Sales slow and this year is no exception.  If you are trying to sell a home and your home is currently on the market don’t get discouraged this is a typical market.  If you are trying to sell a commercial property this time of year is even worse.  The simple facts are that those that have money to buy Real Estate traditionally take their vacations when the weather is good and the kids are out of school.  The sellers I work with I have had to tell them that this is typical and although they don’t want to believe it, the facts are there. 

If you are in the market to purchase Real Estate, this time of year is great as you can usually catch a desperate seller and get a better than normal deal.  Your Agent (if you can find them not on vacation themselves) should know this if they are working for you as a buyer’s Agent.  A savvy Real Estate buyer, either Residential or Commercial, will look for good deals this time of year and smart ones will work their Agent to do so.   

So how do you know how to find the deals, and which sellers that are ripe for dealing?  This is where a great Agent that has been in the business for many years can spot sellers desperate to make a deal.  Some of the tricks we use to identify those desperate sellers are closely held secrets but others I fully intend to share as you can do the research yourself or with the help of your MAE Capital Real Estate and Loan Agent.  The first, and most obvious trick, is to look at how many days, the property, you are interested in, has been on the market.  You see, the longer the property has been on the market the more apt the seller is to make a deal to sell the property to you at a reduced price.  You will find the days on the market, or DOM, on the MLS listings sent to you by your Agent.  Generally, the online property searches do not have that information, so you should be working with an  MAE Capital Real Estate and Loan Agent sending you property to view on their drip system.  If you want a great deal I always recommend that you work with a qualified Agent simply because you don’t pay for their services the seller does. 

Another trick we use to determine if a seller is desperate to sell is to pull a property profile that shows all the information on the loans and deeds on the property.  Sometimes, you get lucky and see that they seller has a type of financing that is coming due.  This means that they may have taken a short term loan out, generally in hopes they could fix and flip the property quickly. If the property sits too long they may get stuck with late fees and additional interest charges so it is in their best interest to sell quickly.  We can also see if there are any notices of defaults on properties in the area you are looking in.  This would indicate that the seller needs to sell before a lender forecloses.  These tricks you can do as a buyer if you know how to find the information, but if you are working with an Agent (preferably a  MAE Capital Real Estate and Loan Agent) we can do the research for you.

You can also look for properties that have been recently reduced in price, this will generally show that a seller is desperate to sell as well.  The theory is that if the seller is willing to lower the price they may have to sell quickly and may take an even lower price.  To take advantage of this, you have to be watching the market every day and be the first to strike.  Again this should be your Agent’s job as you have life to live yourself. 

These are just some of the tricks we use in the business to get our buyer’s the best deals possible.  As you can see we are watching the market, the time of the year, and seller’s actions.  This is what a highly trained Agent will do for you.  We at MAE Capital Real Estate and Loan have several other tools up our sleeves, as you can well imagine, that can help you get the best deals possible.  I know some of you out there are reading this to get educated so you can just call the listing Agent and try to get the best deal for yourselves.  Problem with that is, when you deal directly with the Listing Agent their primary fiduciary responsibility is to get the Seller the best deal possible not you.  Remember you do not pay for the Agent that represents you the Seller pays your Agent.  If you think the commission and costs will be less dealing directly with the listing Agent you are wrong there again, the commission has been set when that Listing Agent takes the listing before you even knew the property was for sale.  So I hope this is a lesson for those that think they can find and negotiate a Real Estate deal themselves and get a good deal.  There is a little saying for those that represent themselves and that is “that if you represent yourself you have a fool for a client”.  True for representing yourself in the legal system as well as Real Estate.  We are here to help and we charge nothing upfront, all of our consultations are free.  So if you want to find the best deal this time of year call us (916) 672-6130 or complete one of our easy contact forms and we will be calling you get you started.  

Posted by Gregg Mower on June 25th, 2015 6:10 PM

Excellent, you have decided to pursue the American Dream of home ownership.  Now what do you do?  Well you need to know how much of a home you can afford with the income and bills you have.  This step is the single most important step to your process of obtaining a home.  This process is called getting pre-qualified or pre-approved.  Although, the thought of shopping for a home may be an appealing one you should not even look at homes until you know for sure what you can buy or if you can buy.  The Pre-Approval process is where you will gather all of your financial documents together and get them to a licensed Loan Officer so he or she run the numbers and your credit report and derive a number to which you can qualify for.  You can read more about this process on our Pre-Approval page or our Process Flow page.  Your Loan Officer will give you a loan amount, a loan program, and a sales price you qualify for based on your finances. 

Once you have the Pre-Approval letter in your hand with the terms and amounts you qualify for it is time to find a Realtor to look for homes with.  You may ask why you need a Realtor, and a simple answer will be it doesn’t cost you anything to be represented by one that knows the laws, the inspections requirements, contracts, and inventory.   Yes, it doesn’t cost anything for you, as a home buyer, to be represented by a licensed Real Estate Agent as the sellers pay the real estate commissions to both the listing Agent and the Selling Agent.   If the free service is not enough to convince you to contact an Agent to work for you how about the laws, unless you happen to be a Real Estate Attorney the laws with regards to real estate process and procedures are many.  If that doesn’t scare you enough to be represented, how about the contract itself, there are items in a professional Real Estate contract that, if missed, could cost you thousands of dollars.    Then there is the inventory, or shopping help an Agent can provide for you.  Again you might say I can find anything I need on the internet.  Again true, but, the problem with internet data is the updating of the data is old.  In some cases like Zillow it requires that the listing Agent actually input the data into the system in order for the world to see it.  Whereas the Multiple Listing Service or MLS is required to be used by licensed Realtors for every listing they have or they will be fined.

Now, that you are convinced to find an Agent to represent you, who do you use?  I would, of course, recommend one of our qualified Agents, but if you are out of our service area we can always screen Agents for you in the areas you are looking to buy.   This is a little know service, again its free to you as a buyer, that we offer to assure our clients are represented by an Agent who knows their stuff.  You see, if you go dialing for dollars, as we call it, you will undoubtedly end up with an un-experienced Agent.  This is because the experienced Agents are out working not sitting in the office waiting for the phone to ring, the Agents that are in the office waiting for the phone to ring are generally new to the business trying to get call in business.  Another pitfall buyers run into is calling the listing Agent on a house they wish to buy and have them represent you.  This is called dual Agency, and we as listing Agents love this as we get both sides of the commission, however, undenounced to the un-educated home buyer, the listing Agent’s allegiance is to the seller first, by law.  So it can really pay to be consulted first by one of our Agents to have them either represent you or screen other potential Agents to represent you and your needs. 

Shopping for the perfect home should not be taken lightly either.  You should have a list of items that are “must have” items in a home such as number of bedrooms and bathrooms, updated kitchen, new or existing home, and most importantly location.  Making this list is crucial for your Agent as they will be able to search for properties that fit your exact criteria, so you are not wasting your time looking at homes that don’t fit your needs.  In addition to the “must have” list you should do a “wish list” like granite counter tops, hardwood floors, a pool etc.  You should also do a list of items you absolutely do not want.  You Agent has the ability in the MLS system to put in exacting parameters that you can’t get on the consumer version on the internet.   Your Agent will put your parameters into the MLS system and put you on an automatic drip of homes in the area(s) you are looking in with the exacting parameters you have.  Your first email of homes will be the largest as the initial search will pull all the current listings that fit your parameters.  The emails you will get after that are “as they hit the market” emails, in other words you will be the first to see the properties come on the market.  This is great if you are in a competitive price range as you will be able to see properties as they come on the market with no delays.  This could be the difference of you getting the best home or not. 

A great strategy to look at homes is to drive the properties that look good in the listings that you have viewed on line.  Driving the properties will give you a real idea of where they are, what they really look like, and how they have been maintained.  When driving the properties you don’t have to include your Agent as you are simply doing your own diligence.  Make notes of the ones you would like to see and then call your Agent to make appointments to see the homes.  Never go up to the door and disturb the occupants it is not nice nor is it safe.  To see the homes your Agent will need to make appointments with the listing Agents or the owners directly for you to get inside.  Your Agent will put together “a tour” that will include your availability to see them and the seller’s availability to show them.  When you go to view the home take pictures and take notes so you can remember the ones you liked and disliked.  You may not find the perfect house after several showings, don’t get discouraged homes are coming on the market every day and with patience you will find what you are looking for. 

You did not expect to go looking for houses today and find the perfect one, but that is the way it happens, one minute you think you will never find the perfect house the next you find one you can’t live without.  You now need to get it tied up so no one else can have your perfect home.   Your Agent will write an offer for you and ask you to provide your pre-approval letter and a Ernest Money Deposit (EMD).  The offer will be on a 10 page form that has all terms in it from the offer price to the loan amount, to the items that need to be inspected, and it also spells out who pays what.   Remember you can ask for anything in the offer and your Agent will go over those details with you.  Once you have decided the price and terms you will be offering you will sign the offer and your Agent will then submit your offer to the listing Agent.  Within the offer you wrote a time period the seller has to get back to you with a response.  When the seller reviews your offer they will either accept it as is or they will counter offer your offer with different terms.  This is all part of the negotiation process.  Once you and the Seller have reached an agreement and both have signed and accepted the terms you are now officially in contract.

Once in contract you will have certain dates that you must adhere to in the contract such as inspection periods.  The inspection periods include your right to get a home inspection, appraisal and any other inspections you and your Agent deem fit.  Those inspections periods are about 2 weeks so you should be prepared to start paying for them right away.  Your Agent will know good inspectors to use so rely on them to guide you through this time period.  A special note about home inspections is that they cover everything from cracks in the driveway to mold in the attic and sometimes it is difficult to determine what items are important to have repaired or if they need repair.  You can talk with the inspector directly to determine this or talk with your Agent or both.  If you determine you require additional repairs in order to buy the house you will have your Agent prepare a repair addendum, and submit it to the seller.  The seller has the right to say that they will or will not do the repairs.  If the Seller says that they will not do the repairs you may need to make the decision to renegotiate price or back out altogether.  If you do back out during the inspection periods you are entitled to a refund of your deposit.  If you miss the time frames in the contract and decide to back out you could very well lose your deposit.  Your Agent will work with you to make all of this legal.  Another variable inspection is the appraisal.  If the appraisal comes in lower than the offering price your Agent will discuss your options with you.  Those options will be to give the seller a counter offer with the lower value as the price, or you could pay the difference in down payment if you are so inclined.  If you decide to pay the difference be prepared to make the down payment on the lower of the sales price or appraised value and pay the difference.  For example if the sales price is $250,000 and you are putting 10% down for a 90% loan to value (LTV) or $25,000, and the appraisal came in at $245,000 you will be required to put your $25,000 down and you will have to add an additional $5,000 for a total of $30,000 and you will still be at a 90% LTV. 

Once you have made it through the inspection periods and everything has passed your standards, we are full steam ahead to the closing of this transaction.  At this time I would suggest you get back with your MAE Capital Loan Officer and make sure they are on schedule to close and see if they need any more documentation from you or explanations.  By now the loan should be approved, and hopefully you are just waiting for the legal paperwork to be delivered to the escrow so you can sign and bring in the remainder of down payment and closing costs.  You can always refer to the closing diagram on our Process Flow page to see where you are at in the process.  There still may be a few weeks left in your escrow process so be prepared to provide more information for your Loan Officer.  Now would be a good time to start preparing to transfer your utilities so you have no interruption when you move.

OK, you signed brought your money in to the Escrow and are ready to close.  The lender must review everything before they release funds to Escrow to make sure all signatures are correct and the all the conditions the underwriter put on the file have been met.   Once everything is good the lender funds the loan to the Escrow and they then take the Deed to the county to record the transaction to make the house legally yours.   Congratulations you are now a home owner and you can move in and do anything to the home you wish.  Your first mortgage payment will be due the first of the following month and be sure to make that payment on time or it will affect your credit.  I hope this helped you with some basics to buying a home.  If you go to our Pre-Approval page and complete the form at the bottom of the page we will contact you are start your process or give us a call we would love to talk to you at (916) 672-6130.

Posted by Gregg Mower on April 29th, 2015 5:01 PM

Is it time to buy Real Estate? Is it time to invest in Notes?  These questions face investors every day.  With the Stock Markets hitting all-time highs you might be asking yourself if you should take your money out of those markets and buy real estate or focus your new investments in Real Estate and Real Estate related investments.  Great questions, so let’s explore what is going on to drive the Real Estate Markets upward over the next few years in California, and might just be the case for the entire Nation. 

Basic economic theory states that where there is a shortage of supply prices will go up.  So the question of supply in the Real Estate Markets comes to question here.  The supply of Real Estate is actually a ridiculous concept as there has always been a limited supply of Real Estate, as last I checked the world is not adding any new land.   That being said, we already know there is a limited supply of Real Estate and we also know that our population keeps growing, and the housing markets have to keep up with that demand.  Problem has always been to keep up with that demand and not over building while attempting to keep pace with demand. 

In 2005 we hit record highs in building new housing and commercial space.  It has taken until now to actually have demand catch supply in housing.     In economics we call this the equilibrium point.  Have we reached this equilibrium point or is it just a moving target.  As we know economics is very fluid and has several factors that affect the theory.  In housing there are far more factors that actually effect housing, such as jobs in the area, demographics, or the age of the population.  As an example of how jobs affect the Real Estate Market, take a look at the Silicon Valley in the San Francisco Bay area.  Here there are a limited supply of housing and high paying tech jobs in a concentrated area.  People tend to want to stay within a 20 mile radius of their jobs.  Thus, you have a limited supply of homes with a high demand for them with people making a higher than normal income.   The average price of a single family home in this region is over $900,000.  Prices in this region of California are so high that a worker with a normal paying job just can’t get in to the buying market in this area.  If you take this micro economy model and apply the basic theory to any Real Estate area you will be able to see what areas are poised to see increases in Real Estate Values.

Although, this sounds easy, people have been trying to do this with accuracy for decades.  We also have to take demographics into the big picture.  Yes, that age groups that are buying Real Estate and what has traditionally been their trends.   Traditionally, the average age of the first time home buyers have been in their mid-twenties, and we have seen this pretty consistently for the last 70 decades.  However, this trend has been bucked in last decade.  Yes, the traditional 20 something’s buying their first home has actually moved to the early thirties.  This is due largely to the economic rescission that started in 2005 through 2011.  When a formative child or teen see their parents go through the Real Estate hangover, or failure, they tend to stay away from what hurt their parents.  Another huge reason the 20 something’s have not entered the Real Estate Market has been the lack of good paying jobs.  The government has been telling us that the unemployment number has been declining, but what they have neglected to tell us is, the jobs created have only been in the low paying areas.  If you have low paying job that maybe you had to take to get started or survive with, those jobs don’t qualify you to buy a home but the unemployment numbers go down.  The number of better paying jobs has increased over the last few years allowing for more people to consider buying a home.

Now that your economic lesson is over we can apply what you have learned to the Real Estate Markets.  We now know that supply and demand affect the Real Estate Markets, and that good paying jobs or the lack of good paying jobs in a specific area will also affect the Real Estate Market.  We know that a certain group of traditional home buyers have stayed away from buying Real Estate longer than normal trends have been.  So what does all this mean and how do you apply this to your Real Estate Investing plan?  It means that we are starting to see those millennials enter the market several years later than they usually did and we also see that the next generation is right on their heels to buy at the same time.  We also know that new house building has not been active since 2005 due to the lack of demand from the recession.  We know that it will take time for builders to start building again as the demand heats up.   We know the job market is regional and some urban areas have better jobs than others with different pay scales in California.    

Looking at California there are areas that are more affordable areas than others due to these factors, but what areas are the best for investors?  A first time home buyer will buy in the area in which there income is produced in.  A Real Estate investor has to evaluate what their overall plan is, such as flipping, holding and creating rental income, or investing in Notes in a specific area.  The affordability has to be taken into consideration as well.  We know that places with high demand such as the Silicon Valley, and certain Beach communities in Southern California will always have a high demand.  These high demand areas are not really that good for investors as there is a high cost to enter those markets and they are not as liquid as they should be for an investor.  Most investors are looking for returns that will can be consistent and fairly liquid.  That being said, a stable job area is always a good for investors to be looking in.  Areas like Sacramento and surrounding communities have a high government job market which creates a stable job market.  Regions like the Los Angeles area have the entertainment industry, as well as a good mix of financial and manufacturing type jobs. 

Overall California has a good job market and is poised for growth.  The most affordable housing markets in California are located in the Central Valley, From Sacramento on the Northern end to Bakersfield on the Southern end of the Central Valley.  As we see more folks hitting the Real Estate Markets we are going to see supply of homes for sale dwindle and that will send prices rising again.  This makes now the best time to invest and hold in Real Estate that we have seen in over a decade.  Builders will start to enter the market but will not be able to keep up with demand for a year or two, keeping prices rising.  Knowing that builders were heavily hit by the last Real Estate Bubble, they will be hard pressed to build as fast as they did in the past, keeping supply limited during this new business cycle and prices up.  So all in all Real Estate Investors should be looking to invest now either in the Real Estate itself or by investing in Notes.  Notes are a great investment as you can get high yields with very low risk with rising Real Estate Values.  As Real Estate rises in value people are far less likely to let their house go to foreclosure, making investing in Real Estate a far safer risk than before.  At MAE Capital Real Estate and Loan we look forward to helping you with your Real Estate needs from buying and selling Real Estate to investing in private notes.  We look forward to assisting you with all of your Real estate needs.   

Posted by Gregg Mower on March 5th, 2015 1:41 PM



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