Bill James, Jr.

by Bill James, CMC
Residential Bancorp
Canton, Ohio

June 2006

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JUNE 2007

POTPOURRI by W H James, Jr., CMC, Board Chairman-Residential Bancorp, Canton, Ohio,  May 10^th, 2007.

OVER THE LAST FEW MONTHS I have had the occasion to hear from (or about) members and prospective members of OAMB who actually BLAME the Association for failing to stop SB 185!  Let me quickly stat a fact of life…even if the OAMB had Jesus as our lobbyist 185 was gonna happen!  The time, mood, and circumstance for 185’s implementation was a TSUNAMI…a perfect storm.  We all know laws are enacted by politicians, politicians are elected, and the only interests many politicians serve are their own.  From the moment they are elected their main thrust and efforts are geared toward re-election.  Any politician who “fought” SB 185 might just as well have chug-a-lugged a large Jim Jones Kool-Aid!  What you should know is how much effort and how many hours were spent by your OAMB in successfully extracting onerous parts of the bill…the efforts were huge (little things like removing fiduciary responsibility etc.)  Rob McGeorge and Kevin Patterson seemed like they were working full time fighting (successfully on many onerous parts) for at least some sanity on the bill.  Erick Parker, Jim Nabors and Mike Farrell spent many hours testifying before Senate Committees and along with McGeorge & Patterson negotiating as best they could under impossible odds.  Ric Baird (Government Edge) gave their all in this uphill battle…they are excellent partners.  Many other OAMB members gave of their time & expertise in the flight.  While 185 was hurtful to many brokers, the fact is many of the Sub Prime mortgage products were about to self destruct on their own.  A trend back to responsible lending was on the march.  We will soon see Federal Legislation called the “Borrowers Protection Act of 2007 “that will mirror (or worse) Ohio’s SB 185 and make it a moot point (if it happens).  Incredibly the Fed law will also exempt National Charter Lenders and their subsidiaries! Insane!  There are new tests our industry will be facing…if you have the guts, join us in the trenches.  Membership in OAMB says you are a professional and you will fight for your industry.  If you must express your discontent by verbal urination, come under the OAMB tent and aim OUTWARD!  Call or email me, I’ll get you started!

NEWT GINGRICH—you remember Newt he’s the politician that started the Republican Party on the road to ruin…Well he’s back!  On national television he announced he had an answer to stopping the Virginia Tech type college disasters in the future.  Yep, Mr. Gingrich says the answer is to ARM OUR COLLEGE STUDENTS!  He says if students carried guns they could stop the lunatics…Well Newt it would also create some very interesting Saturday nights at the pubs!  Probably make the OK Corral look like childs play.  Now I better understand why we are at war in Iraq.

LOOKING FOR new lending possibilities?  Pick up the phone and call Vince Paumier at USDA Dept. of Rural Development, 614-255-2404.  Vince runs this program for purchase of homes and the program is a throw back to “common sense” lending.  100% LTV and reasonable underwriting guidelines.  NO computerized, credit score stuff.  Vince looks at the whole picture and all circumstances.  At a recent seminar Vince told the story of an applicant Bill James III (President of Residential Bancorp) had sent him.  After reviewing the file he felt he was not quite strong enough in income to qualify, so he advised Bill the loan was declined.  Vince went on with the story.  “Bill called me back and asked me if I knew what the applicant did for a living.  Vince said yes, he works at a poultry farm:  Bill said, “No, what does he do?  Vince said no…Well, Bill went on “he is a chicken catcher.”  When he made application I noticed his arms were all cut and scarred.  When I asked what the injury came from, he said he had to catch and crate chickens and in doing this the chickens cut him up every day.  Bill asked Vince if he didn’t think maybe this guy deserved a chance?  Vince approved the loan on the spot.  It’s a good program, Vince is great to work with and Brokers are welcome…Call him.  This USDA program gives 100% insurance on the loan and your lender buys it just like FHA.

I AM WATCHING…an increasingly familiar scenario.  Over the last 4-6 weeks I am getting a great many e-mail offers of COMMERCIAL MORTGAGE loan programs.  The programs offered are now starting to look like the old conventional non conforming & sub prime residential mortgage programs that put our industry in the toilet, economically and politically.  Let’s hope the commercial mortgage industry doesn’t emulate the mindless mortgage programs of the residential sub prime mortgages of the recent past.

AH THE BROWNS…Great use of their 1-#3 pick in the draft.  Joe Thomas is a football player…He will get the job done.  How can you go wrong with a guy like Thomas?  While all the other potential 1^st rounders were partying at the hotels, clubs, homes, and lining up the stretch limo’s…where was Joe Thomas?  Mr. Thomas was out on Wisconsin lake fishing with his dad!  Equally important they caught lots of large fish…I love this guy.  Now comes round #1 pick #22 belonging to the Cleveland Browns.  They take Brady Quinn.  Here in a typical Cleveland Browns mentality statement, Savage yells “I can’t believe our luck to have Brady not taken before #22”.  Well Mr. Savage the reason he was still available at 22 is

NONE OF THE OTHER 21 WANTED HIM!  Actually taking Brady as their second choice was a superb move.  Taking Brady @ 22 might be looked back on as a “BROWNS SAVING”!  Brady Quinn has the tools and ability from being a 4 year starter on a pressure packed program and coached (the last 2 years) by one of the best.  The problem?  Cleveland must have a butt kicking, fire breather at QB leading the Browns.  They sure as hell have nothing from the “Deer in the head lights” coaching staff…If Quinn can contract a serious case of “mean” he could be the man…my guess—NO… With any other team Jamal Lewis has 2 good years left…with Cleveland he’ll be wasted.  At Baltimore he averaged 20 carries per game.  With Cleveland’s offensive mentality he’ll be lucky to average 12 per game.  He needs 25+ carries per game.  2007 predication w/Frye 5-11. With a “mean” Brady, 8-8.

THEN THERE ARE THE CAVS…Great ownership, good coaching, excellent talent…Maybe not this year but soon!

Bill James is Board Chairman of Residential Bancorp in Canton, Ohio and can be reached @ 330-495-6041.  Want to comment on Potpourri?  Email me Bill James, Jr.

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