From the OC Register.com comes another story on the rise and fall of a real estate mogul. Be sure to read the comments at the end of the story:
Daniel Sadek played Orange County's subprime lending boom like a card shark dealt the ace and jack of spades.
Just five years ago he was selling cars.
Then, in January 2002, he anted up $250 for a state lender license and started selling home loans through his company, Quick Loan Funding.
Over the next five years, Quick Loan wrote $3.8 billion in mortgages, lending money fast – and often on onerous terms – to people with shaky credit.
Boosted by high fees and interest rates – high even for the subprime industry – Quick Loan's after-tax profits averaged 29 percent of revenue. In 2005, Quick Loan's biggest year, profit topped $37 million.
Sadek used the earnings to live the high life, buying a fleet of Ferraris, Lamborghinis and Porsches, dating a soap opera starlet and producing movies. He flew private jets to Las Vegas, where he gambled with high rollers at the Bellagio Resort.
He cultivated a rebel image, wearing a beard and hair to his shoulders, dressing in T-shirts and flip-flops, eschewing the typical mortgage banker's pinstripes.
"How many thieves are wearing a suit?" he asks, sitting in the kitchen of his $4 million Newport Coast mansion.
Quick Loan Funding's name still crowns a Costa Mesa office tower. But Sadek, like the subprime lending industry, is holding a bad hand.
His staff, once 700 strong, has shriveled to about 125. Monthly loan volume plunged to $30 million from a record $218 million in December 2005.
Sadek says Quick Loan had to buy back $29 million in loans that defaulted in the first two months. That's a number that's likely to grow.
Today he is $16 million in debt, he says. Sadek says he raised $13 million for Quick Loan by selling his cars and refinancing his Newport Coast mansion, an Irvine penthouse and a Las Vegas condo.
He believes the company is a good bet.
"Tough times don't last," he says. "Tough people do."
Sunday, May 20, 2007
High roller of home loans
Subscribe to:
Post Comments (Atom)
9 comments:
His story sounds similar to the dot-com nonsense here in Silicon Valley--a carnival-like atmosphere in the work-place. And you know something, you don't read squat about foosball, ping-pong, pinball, pool, pets-at-work, etc, anymore. All the idiot twenty-somethings were delusional. Actually, a lot them probably latched onto the real estate fiasco. What's next Gen-dumb?
Next dumb? Foreclosure profiteering!
Just bring them on, New ERA Repos $$$$$$ (every dog has his Day)
"How many thieves are wearing a suit?"
Or a murse?
Seroiusly, there is soooo much liquidity floating around that the people who buy the first rounds of foreclosures are going to have to BK before there are any deals.
Not necessarily, there are still plenty of foreclosure deals out there currently, with ridiculous profit margins.
Some foreclosures, a couple which I have purchase have already been sold to first time homebuyers, picked them up for $100.00 per square foot and sold them for $120.00 per square foot, everyone made out. Sure there was only about $8,000.00 in profit, but I was used to that number in 1998-2000. You do not have to be greedy in order to profit from the foreclosure market.
I have not seen anything under $115 per sq ft, I need to start looking harder. :)
However, all the "high-end" stuff is still $200+ per sq ft. Lots of dreaming going on there.
Yeah, Sadek from QuickLoan Funding seems to be another 'rags to riches' story: 5 years ago, he was a used car salesman. $250 later, and he's registered wih California to start a brokerage (as the article points out, it takes less effort to become a broker than to become a licensed barber, manicurist, or even a dog clipper).
FWIW, Sadek also produced that "Redline" movie where actor Eddie Griffin crashed the broker's $1 mil Ferrari during a promotional stunt for the movie (remember the footage of the actor running into a concrete barrier that hit the news?)
I guess I'm too cynical to be wondering if the crash was intentionally staged? He spent $55 million on the movie, so what's a million more on a crash?
laoplklBuy / Sell / Rent / Lease Properties in India Online!!
Visit http://www.placidhomes.com
The Elegantly Smart Real Estate Search Engine in Bangalore / Hyderabad / Mysore / Coimbatore / Hosur and all cities in India.
Celina Jones
Real Estate Consultant
http://www.placidhomes.com
Hey your article is quite interesting and providing valuable information with regards to Bad credit even i do have similar kind of website which is giving valuable information on......
Bad credit real estate loan
Post a Comment