Will You Trade in Your Calculator for a Thermometer?
March 29, 2008
Nursing: The Recession-Proof Job Market
Former finance workers are switching careers to answer the huge demand for new nurses.
NEW YORK (CNNMoney.com) — When Heidi Sadowsky quit the finance sector, she abandoned a job market on the verge of collapse for one that may be air-tight: nursing.
“I was never happy in my life in finance,” said Sadowsky, 39, a former liaison for institutional investors and money managers at Citibank and Invesco. “I always felt like a square peg in a round hole. I decided I had to get out of this business. I was never cut out for this.”
Inspired by the compassion of nurses who cared for her terminally ill father, Sadowsky took up training last year at New York University’s College of Nursing. Since she already had an undergraduate degree, she was accepted into the nursing school’s accelerated 15-month bachelors program and she expects to graduate in May. At $64,000, the NYU tuition is far from cheap, but starting pay for graduates is up to $70,000 a year in New York City. Nationwide, the average pay is about $56,000.
Most importantly, the job security is iron-clad. When Sadowsky graduates in May, she will enter one of the few areas of the job market that’s showing significant growth.
“People are always going to be sick, and the nurses are the front line in the hospitals,” said Sadowsky, who believes there will “always be jobs” in the nursing profession.
Timing is everything
Sadowsky picked the right time to switch careers. The finance sector has shed 124,000 jobs since the beginning of 2007, according to the Department of Labor, including 22,000 jobs in the first two months of this year. Major firms like Bear Stearns (BSC, Fortune 500), Merrill Lynch (MRL) and Sadowsky’s old employer Citigroup (C, Fortune 500) have been hard-hit by the subprime collapse, and analysts expect up to 30,000 more job cuts in finance by the end of the year.
Meanwhile, hospitals, clinics and nursing schools are scrambling to fill vacant positions for nurses and teaching staff. The Department of Labor estimates the number of vacancies for registered nurses will expand to 800,000 in 2020, from its 2005 tally of 125,000.
“No other occupation is seeing a higher ratio of job postings to seeker-resumes,” said Hugo Sellert, head of economic research at the employment Web site Monster.com.
Sellert said there’s been a 15% increase in nursing jobs posted on Monster.com over the last year, compared to a 15% decrease in finance and insurance jobs, and a 5% decline overall.
“We know that the demand for nursing is going to grow,” said Cheryl Peterson, senior policy fellow at the American Nurses Association. “We’ve got an aging baby boomer population which is only going to drive the demand.” Many nurses are themselves boomers who will be retiring soon, further increasing the need.
Claire Young, chief nursing officer at the Cleveland Clinic, one of the nation’s top-ranked hospitals, said she’s looking for 300 new nurses to add to her current staff of 3,800. Many of these nurses would be working in expanded facilities to meet “enormous” demand from a growing patient population, she said.
In order to woo new nurses, the clinic is offering thousands of dollars in tuition reimbursement, as well as free uniforms and flexible schedules.
It’s also trying to convince workers who’ve been laid off from other professions, like manufacturing and computer technology, to move into nursing. “The shortage is something we’ll be living with for a long time, but we can’t stop offering care,” said Young. “Unfortunately, one of the strategies is capitalizing on this recession.”
NYU’s College of Nursing has doubled enrollment since 2001, to 1,180 students. Terry Fulmer, dean of the college, said the school doubled the size of its facility since 2002, and doubled its full-time faculty to 52.
“We’re turning away students because the demand is tremendous,” said Fulmer, whose school accepted only 200 students out of 908 applicants for the fall semester. To meet demand, she said the college is getting ready to build a new facility that’s twice the size of the current one.
Nine women to every man
To help fill the ranks, the nursing profession is trying to convince men, not just women, to become nurses. The profession is currently 90% female.
“Tradition holds that a guy’s going to be a doctor, and the female is going to be a nurse,” Neville Lewis, 40, an NYU nursing student who is married to an RN.
Like Sadowsky, Lewis abandoned finance to take up nursing. Since he already had a bachelor’s, he qualified for NYU’s accelerated 15-month program. Lewis said he majored in political science and mass communications at Midwestern State University in Texas, and then embarked on a 15-year career in the bond and IPO sector at the investment firms Equiserve (now Computershare) and Fidelity Investments.
“I kind of fell into finance after graduation,” said Lewis, who had felt the lucrative pull of the finance sector. “You make a lot of money, but do you enjoy it? I was not happy.”
After getting laid off from Equiserve in 2002, Lewis took a job at Fidelity and considered going back to school to pursue tax law. But he changed his mind, quit Fidelity in 2007, and started at NYU’s nursing school in January, 2008. He expects to graduate in 2009.
“I felt like I could accomplish more by working to heal people, then by helping people fight over money,” he said. And as he watched his former sector collapse, Lewis realized that altruism wasn’t the only motive to get into nursing.
“Seeing what’s happening now, I have no regrets in leaving finance,” he said. “People are always going to be sick. We live in an aging society.”
Bargains: The sunny side of the housing slump
March 25, 2008
Despite the downturn, some people are still managing to make money off real estate. Here’s how they’re doing it.
By Judi Hasson, MSN Real Estate
Yes, there’s gloom and doom in the housing market. Prices are plummeting, sales are stalled and foreclosures are rising. But for some, the hard times are an opportunity.
“There’s always someone selling. There is always someone buying,” says Steven Brown, an investor who buys houses in Mobile, Ala., does a face lift and makes money on the resale.
Houses too burdensome for their previous owners have become ways for new owners to build nest eggs for retirement and college. While the market for foreclosed and distressed homes is tough to master, rock-bottom prices in some areas have tempted renters and investors out of the woodwork.
Some buy a single house and flip it for a profit. Some buy in hopes of becoming a landlord. And some buy because it’s now cheaper than renting.
Renters turn homeowners
One of those renters was Morganne Teseniar, 26, of Mesquite, Texas, a suburb of Dallas, who says she wanted to buy a house last fall despite the touch-if-you-dare market.estate agent. She found her dream house for $64,000, bid $50,000 on the foreclosed property and moved in this past November.
The previous owner walked away from the house when he got a new job in California, couldn’t sell it and wouldn’t pay the mortgage, she says. Left behind was a perfectly fine house with redone floors, wrought-iron fixtures and granite countertops.
“It was gorgeous. I couldn’t breathe when I got it. It was so cool,” says Teseniar, who is divorced and has a 4-year-old daughter. The price was right, too. She now pays $586 a month for her mortgage, taxes and insurance, $200 less than what she had been paying for rent. And she qualified for a 30-year Federal Housing Administration mortgage to buy it.
Then there are buyers like Lymaris Roman, a Tampa, Fla., pharmacist, and her husband. They saw opportunity, too, in a one-story home with four bedrooms in suburban Lutz, Fla. They bought it for $270,000, far less than its $400,000 appraised value. They moved in on Christmas Day.
Roman’s husband, a self-employed contractor, had plenty of time on his hands because of the housing downturn. He spent less than $10,000 upgrading the house, pulling up the carpeting and installing hardwood floors.
They took out an interest-only mortgage and are renting their old house until the market “comes back up.”
“Hopefully, the economy will be up and running again. If we can rent it out for longer, great,” Roman says.
Opportunity for the little guy
For the smaller entrepreneur, the deal is the thing.
Alex Szalay, a software writer from Pittsburgh, has redone two houses in the past 18 months. He says it’s profitable to buy foreclosed homes that are in reasonably good shape. He bought one house for $72,000 and sold it for $117,000 a few months later in Sharon, Pa., about 30 miles north of Pittsburgh.
“You have to be willing to sit on a down market,” Szalay says. “I have been fortunate in finding good deals. When I started doing properties, I would buy one fixer-upper at a time. Now, I am able to do a couple at a time.”
Tom Cook, an Arlington, Va., contractor, bought a ranch house in January for $500,000. He didn’t think that was too risky. He plans to sell the renovated home in this Washington, D.C., suburb for $1.2 million after a complete renovation that will include five bedrooms, 4½ baths and a two-car garage.
“The market is flat in Arlington but not as flat as outside the Beltway,” Cook says. “Arlington is resilient. People work in the government and defense industries. In the long run, we feel we can move it in 60 days.”
While Cook and others see openings in the short term, Stephen Crawford of Richmond, Va., is looking for long-term opportunity.
The father of four children, Crawford recently bought three investment properties in Atlanta at reduced prices in hopes they will help finance his kids’ college educations. He’s still looking for a fourth nest egg for his 6-year-old.
Crawford has no problem sitting on the houses, betting that the property values will rise as the market regains its footing. In the meantime, he’s renting out these homes to pay down the mortgages.
“Once the market takes a turn, these properties will be worth it,” says Crawford, who works for a health-care company. “Real estate has always been a good investment.”
Flipping on a grand scale
While mortgage rates have been dropping, it is still tough for some people to get a mortgage as a result of the subprime scandal, where buyers were signing up for badly crafted loans. Plenty of mortgage money has dried up, and banks are extremely cautious about making sure buyers are qualified to make their monthly payments.
Still, there are plenty of people willing to take a chance if they can. Brown, the Alabama entrepreneur, sold 85 houses through his company last year. He expects at least that many sales this year, banking on the construction of a ThyssenKrupp Steel USA carbon and stainless-steel processing plant that will bring many new jobs and home buyers to his region.
He usually spends less than $20,000 on rehab, adding new fixtures, upgrading the flooring and installing central heat and air conditioning in houses built 50 years ago.
Florida investor Cody Loughlin is another of the hard-times risk-takers, expressing confidence that the market will do well for him even in a state that has one of the highest foreclosure rates in the country.
Unlike big builders who constructed giant homes at top dollar and are stuck, Loughlin says he makes money by buying properties at 50 cents on the dollar and selling them for 75 cents on the dollar.
Loughlin’s company, Florida Property Club, is attracting buyers from all over the United States and as far away as South Korea.
He recently bought a four-bedroom, three-bathroom home in Lakeland, Fla., for $240,000, made $30,000 in repairs and sold it for $365,000 within three months.
“When people tell you, ‘Don’t buy real estate,’ well, you should buy real estate,” Loughlin says. “People aren’t going to stop retiring. Kids aren’t going to stop graduating from colleges. This lag will catch itself, and there will be more demand than supply.”
And there are plenty of people such as Loughlin still willing to take a chance to make money on real estate. Sandy Muff, 31, an office manager in Tampa, Fla., decided to buy a bungalow last year for $70,000.
She’s renting it out at $950 a month and paying a $900 monthly mortgage. She eventually hopes to sell the 950-square-foot home for $135,000, its current appraisal.
“You have to spend money to make money,” Muff says. “You’re not going to be in a slump forever.”
It’s not all sawdust and profit
Experts caution the housing market has not reached bottom, and it may be another year before the economic realities shake out. Lehman Brothers has reported that the number of foreclosed homes is expected to quadruple this year, adding 1 million properties to the market in 2008 and another million in 2009.
One economist warns that people can still “lose their shirts” with high-stakes gambles.
”There are certainly places where the market is going to be good and growing. But you still could be making a bad move,” says Dean Baker, co-director of the Center for Economic and Policy Research in Washington, D.C.
Yet plenty of investors are willing to take that chance.
Foreclosure auctions can pit a small investor against well-schooled experts who know how to calculate a property’s real value. In addition, many properties are mortgaged so steeply that banks often ask for bids that are higher than what the properties are worth. On top of that, an increasingly stringent credit market means fewer buyers can qualify for a mortgage.
Thriving in the chaos
Despite the pitfalls, many say they can beat and have beaten the system by seizing opportunity while remaining flexible.
In Tacoma, Wash., Steven Ling is making money off foreclosures or on houses that are on the verge of being put on the auction block. He buys them at a steep discount, adds granite countertops and maple kitchen cabinets, and gives them a bit of curb appeal.
Right now, he’s working on a house originally listed at $300,000. He bought it for $175,000 because the owner wanted to avoid having a foreclosure listed on his credit record. Ling is adding some updates and a fresh coat of paint, and getting it ready for an “average Joe.”
Ling says it takes maneuvering to get some potential homeowners qualified for a mortgage. That occasionally means renting them a house on a lease-purchase deal and helping them straighten out any credit mess to qualify for a mortgage.
“We make sure the income they make is feasible to handle the house. And if that is the case and credit is messed up, we let them buy the house on a lease option,” Ling says.
Still, skeptics remain.
Mike Meredith from Washington, D.C., renovated and sold 75 properties in the past two years, but has decided to sit it out for a while.
“I am waiting until next winter, when the prices will drop more,” Meredith says.
Fannie, Freddie cleared to pump $200 billion into market
March 19, 2008
By Patrick Rucker
WASHINGTON (Reuters) - The regulator of Fannie Mae and Freddie Mac on Wednesday eased capital requirements for the two biggest housing finance agencies, allowing them to pump up to $200 billion into the distressed U.S. mortgage market.
The regulator, the Office of Federal Housing Enterprise Oversight, said it was lowering to 20 percent from 30 percent the amount of extra capital the companies are required to hold. It will also consider further reductions. The 30 percent requirement had been imposed after the discovery of lax accounting and risk controls earlier this decade.
In addition, the companies will begin to raise “significant capital,” OFHEO said in a joint statement with Fannie Mae and Freddie Mac. Last year, the companies sold nearly $14 billion in preferred stock.
The extra $200 billion would allow Fannie Mae and Freddie Mac to purchase both existing mortgage-backed securities and new home loans originated by banks. It could also enable them to increase their business of guaranteeing mortgages, a key to helping pull the U.S. housing market out of its funk.
“It’s good news,” said Chris Rupkey, chief financial economist at Bank of Tokyo/Mitsubishi in New York. “A lot of mortgage originators have left the business, so it’s a good thing that mortgage money will be made more available.”
The move is a shift for the Bush administration, which has long argued the combined $1.4 trillion portfolio of the companies represents more of a risk to the U.S. financial system than a help to homeowners. The new policy comes as falling home prices and increasingly jittery financial markets have pushed the U.S. economy to the verge of recession.
After the announcement, shares of Fannie Mae and Freddie Mac rose sharply for a second day. Fannie Mae stock rose 10.5 percent to $31.17, a five-week high, while Freddie Mac jumped 8.3 percent to $28.18, the highest since February 20.
FULL COMPLIANCE
The regulator said Fannie Mae was in “full compliance” with government restrictions placed on the company for accounting violations, while Freddie Mac had to clear one more hurdle relating to the separation of the roles of the chairman and chief executive.
Freddie Mac has already said it is splitting what had been a co-chief executive/chairman job and was currently searching for a new chief executive.
The regulator said it expects to remove special regulatory constraints placed on the companies after the book-keeping scandals, which came to light for Freddie Mac in mid-2003 and in 2004 for Fannie Mae.
Increased investment by Fannie Mae and Freddie Mac is expected to bolster confidence in a secondary mortgage market shaken by a wave of failing home loans. Cratering prices and a sell-off of mortgage-related assets this year have fueled an escalating credit crunch that may have already tipped the U.S. economy into recession.
Mortgage-backed securities issued by Fannie Mae and Freddie Mac rallied, pushing their yield spreads to government debt to their tightest since February — indicating a perception of falling risk. Fannie Mae and Freddie Mac are the biggest buyers in the $4.5 trillion “agency” mortgage-backed securities market.
The government-sponsored enterprises have been surprised by the magnitude of the housing slump, raising questions of how much risk they can take with the capital, analysts said. Both companies boosted forecasts for credit-related losses through 2009 after reporting combined net losses of more than $6 billion for the fourth quarter.
(Additional reporting by Mark Felsenthal in Washington and Al Yoon in New York, Editing by Frank McGurty) - Full Article
FHA Mortgage Limits - All States/Counties
March 18, 2008
The New FHA loan limits for other states have not been released. 
Although, you can always check here.
Bear Market Blues for Bear Sterns
March 17, 2008
Bear Stearns dramatic plunge stuns Wall Street 
Posted: March 17, 2008 03:31 PM PDT
INDIANAPOLIS (WISH) - The stock market finished the day on an upward note after a dramatic turn of events this weekend. Bear Stearns, the country’s leading overnight lender, fell at breathtaking speed.
In the end, the Federal Reserve stepped in to try to avert what it believed could be a global financial crisis.
“The old run on the banks is when people would go to take their money out of the bank. That’s not what’s happening with Bear Stearns. With Bear Stearns people are not putting their money into the bank and Bear Sterns is the number one provider of overnight loans. They don’t have any money to lend,” said
Bear Stearns securities, backed by home loans made investors nervous.
So, they wouldn’t buy Bear Stearns stock and the stock price plunge was dizzying.
$57 a share on Thursday, $30 on Friday, and finally on Sunday JP Morgan Chase bought the 85-year-old investment firm for the bargain basement price of $2 a share.
“The engine of the economy is slowing down. It is slowing down to the point that companies are not investing, their not building parts, their not buying equipment, they’re not hiring people as a result,” said Matt Will of the University of Indianapolis.
And that’s when Wall Street affects Main Street.
The fed cut the rate it lends money to banks a quarter point.
Some analysts criticize the move.
“They’re fueling inflation. The biggest fear in this economy should be inflation,” said
So, the result of Bear Stearns’ monumental fall and the fed’s unprecidented actions to fix it could directly affect your wallet.
“It’s very likely that inflation this coming year could be between 5 and 10 percent. That’s scary because inflation represents a paycut for every one of us,” said
Investors are now looking for profit reports from Lehman Brothers, Goldman Sachs and others to see if they could suffer the same fate as Bear Stearns.
No Mortgage Candidates Need Apply???
March 11, 2008
Update on March 10: the words “NO MORTGAGE CANDIDATES” have been taken 
down from AppleOne’s job posting (see link below).
posted by Andrew Galvin
Angela Camacho of AppleOne told me it never should have happened: she made a mistake when she cut and pasted the client’s wording into the online posting. “I do wholeheartedly apologize for that,” she said.
I’ll write more about this soon. In the meantime, my original blog post follows:
I’ve been hearing rumors about this kind of thing, but now somebody has finally shown me the evidence:
Some companies are specifically stating that they don’t want any job applications from former mortgage workers.
For example, take this online posting by AppleOne, a staffing company, on Gadball.com, a job-search site:
I am looking for candidates for the following PERMANENT job orders. This company is the number one sales and training company within their industry. It’s located in San Juan Capistrano. They grow 37% each year!
Here are the 4 job orders they currently have open:
Customer Service- Candidates must be fun, upbeat, professional appearance, 3-5 years of customer service experience, good personality. Pay is $18-$20 per hour. NO MORTGAGE CANDIDATES.
No mortgage candidates? This lends credence to complaints by former mortgage workers that they are being stigmatized and discriminated against.
FHA Mortgage Limits in California by County
March 6, 2008
Oven fresh FHA loan limit stats! (Please check back later for other states as more information is made public.) 
County Name Median Home Price FHA Limit
Alameda County $995,000 $729,750
Alpine County 438,000 547,500
Amador County 355,000 443,750
Butte County 320,000 400,000
Calaveras County 370,000 462,500
Colusa County 318,000 397,500
Contra Costa County 995,000 729,750
Del Norte County 249,000 311,250
El Dorado County 464,000 580,000
Fresno County 305,000 381,250
Glenn County 230,000 287,500
Humboldt County 315,000 393,750
Imperial County 260,000 325,000
Inyo County 350,000 437,500
Kern County 295,000 368,750
Kings County 260,000 325,000
Lake County 321,000 401,250
Lassen County 200,000 271,050
Los Angeles County 710,000 729,750
Madera County 340,000 425,000
Marin County 995,000 729,750
Mariposa County 330,000 412,500
Mendocino County 410,000 512,500
Merced County 378,000 472,500
Modoc County 125,000 271,050
Mono County 370,000 462,500
Monterey County 599,000 729,750
Napa County 615,000 729,750
Nevada County 450,000 562,500
Orange County 710,000 729,750
Placer County 464,000 580,000
Plumas County 328,000 410,000
Riverside County 400,000 500,000
Sacramento County 464,000 580,000
San Benito County 790,000 729,750
San Bernardino County 400,000 500,000
San Diego County 558,000 697,500
San Francisco County 995,000 729,750
San Joaquin County 391,000 488,750
San Luis Obispo County 550,000 687,500
San Mateo County 995,000 729,750
Santa Barbara County 615,000 729,750
Santa Clara County 790,000 72,9750
Santa Cruz County 719,000 729,750
Shasta County 339,000 423,750
Sierra County 228,000 285,000
Siskiyou County 235,000 293,750
Solano County 446,000 557,500
Sonoma County 530,000 662,500
Stanislaus County 339,000 423,750
Sutter County 340,000 425,000
Tehama County 250,000 312,500
Trinity County 200,000 271,050
Tulare County 260,000 325,000
Tuolumne County 350,000 437,500
Ventura County 599,000 729,750
Yolo County 464,000 580,000
Yuba County 340,000 425,000
14 Calif. counties get maximum FHA limit
March 5, 2008
By Marcy Gordon - Washington
The government on Wednesday raised the mortgage limits for loans guaranteed by the Federal Housing Administration in 14 high-cost California counties.
The Department of Housing and Urban Development released the new loan limits for California — a hotbed during the housing boom that now is suffering the worst home-price declines in the nation. The limits, with the maximum at $729,750, are derived from median home prices in each county.
HUD is expected to raise the limits in other counties nationwide in the coming days.
The economic stimulus package includes a temporary increase in the limit on FHA-backed loans, from $362,790 to as high as $729,750 in expensive areas, to let more homeowners with high-rate subprime mortgages refinance into federally insured loans.
The package also includes a temporary increase in the cap on mortgages that the government-sponsored mortgage companies Fannie Mae and Freddie Mac can buy or guarantee from $417,000 to $729,750.
The idea is to stoke investor demand for securities made up of more expensive mortgages — so-called jumbo loans — backed by Fannie and Freddie, the two biggest mortgage financers in the country. That would drive interest rates lower and spur home buying and refinancing.
Roughly half of all jumbo mortgages are in California, according to federal regulators.
California Gov. Arnold Schwarzenegger said the new limits will “help California’s housing market rebound.”
“No other state has been more impacted by the ongoing mortgage crisis than California, and the announcement today … will help more working Californians achieve the American dream of homeownership through less expensive and more secure loans,” he said in a statement.
Schwarzenegger has pressed Congress to make the increased limits — which expire at year’s end — permanent.
The Federal Housing Administration, a Depression-era agency within HUD, insures mortgages for low- and middle-income borrowers.
Counties that get the $729,750 maximum for FHA loans are likely to get that same level for Fannie and Freddie mortgages, experts said. HUD is expected to designate new Freddie and Fannie limits for other parts of the country too.
In California, the counties at the maximum level for FHA loans are Alameda, Contra Costa, Los Angeles, Marin, Monterey, Napa, Orange, San Benito, San Francisco, San Mateo, Santa Barbara, Santa Clara, Santa Cruz and Ventura. At the other end, Lassen, Modoc and Trinity counties are subject to a loan cap of $271,050 — a standard amount in an area with normal home prices.
HUD Secretary Alphonso Jackson said Wednesday the new limits will make FHA-backed loans available to as many as 30,000 Californians and 250,000 homeowners nationwide.
The new limits “will allow for greater economic stability for our communities,” Jackson said in a speech in Los Angeles. A text of his remarks was distributed by HUD.
“We confront an emergency, a crisis,” Jackson said. “Los Angeles has been hard hit.”
He noted that home foreclosures in southern California soared 433 percent in January from a year earlier.
The number of U.S. homes facing foreclosure rose 57 percent in January.
