Why is it that every real estate person that I’ve talked to does not know what Fixed income means?
Princess Myfaeia
2008-01-30 12:21:09 UTC
Why is it that every real estate person that I’ve talked to does not know what Fixed income means?
25 answers:
2008-01-30 14:22:57 UTC
i think they just play dumb because they don,t want to deal with people on a fixxed income because they couldn,t get their comisson ,people on a fixxed income or poor people are third rate citizens in this country and if government and big business had their way all fixxed income and poor folks would be put to death
2008-01-30 12:49:05 UTC
How many have you talked to, usually fixed income is lower than will qualify for a loan. Some banks won't except fixed income because it can not be garnished. They probably wanted to know if you had any other source of income. Fixed income usually means retirement or some special assistance, usually neither is enough to qualify, depending on area.

Wake up and spell the coffee. Don't worry about adding more info, just proof-read what you have already written.

Myfaeia C: don't email and whine and moan about my comment.
2008-01-30 12:30:38 UTC
First, you didn't say how many "every" is . . . two? three? five? ten?

Second, you didn't say why you are speaking to real estate agents. Are you buying or selling or renting?

Third, you didn't say why the topic of income came up.

Fourth, it's more likely that you misunderstood their reaction and/or question. For example, they might have asked what you meant by that (i.e., are you a lottery winner? social security only? rental income? royalties? etc).

Regardless, you should not discuss your income or any other personal information until you have decided on a home to buy. The bank and/or mortgage company is the only one that needs to know your financial situation. If they ask for anything other than your ID to see a home, tell them you do not wish to give that information at "this time" (avoid giving any ID that has your Social Security or similar numbers on them).
2016-04-08 10:43:52 UTC
The most normal property we sell in our area is about $150,000. Other areas withing 100 miles of me the most normal property sale may be $300,000 to $400,000. In other areas around here it would be less than $100,000. Of course this affects the commission. Also some agents I know only work when they "need" money. Others work very hard all the time. A third thing can be how people count things. An agent that is trying to brag can find a way to count things truthfully but in a way that sounds as high as possible- for instance if I have a team of people working for me (that I have to pay) and we all together bring in $500,000 in commission before any of them are paid for their work- I might say I make $500,000. So there is no meaningful number anyone can give you.
2008-01-30 12:32:29 UTC
They pretend to not know what it is because in real estate, they base the cost of a house that you want to buy upon your earnings. They look at 2 things: your credit and your income-earned income to be precise. They are trying to let you know in a subtle way that there is no hope for home-buyers if home-buyers are on a fixed income.
livin the dream
2008-01-30 12:25:11 UTC
A lot of people in real estate are just there for the commision sales and they don't really get educated unless it is by experiance. Maybe instead of using the terminology of Fixed Income, just explain that the ONLY source of income is X per month.
2008-01-30 16:41:16 UTC
I have 2, 7 yr old's that know what a fixed income is,its the same thing every month poor. people that want to sell u something are most likely working on commission and don't care as long as they can make a buck.
2008-01-30 12:26:39 UTC
I believe everyone knows what fixed income means. Perhaps you’re looking at a home that is beyond what your income can buy?
Pam H
2008-01-30 12:25:01 UTC
They work on commission. People with fixed incomes usually don't have enough to buy houses so they don't talk to real estate agents. Or because they are a bunch of dumb *sses. Take your pick.
2008-01-30 12:24:35 UTC
They know, but their job is to sell you a house. So they don't want to acknowledge the idea of a fixed income.

Most 10 year olds know what a fixed income is.

So if you believe they don't know, you are mistaken.
2008-01-30 12:25:51 UTC
I suggest you start talking to those who DO know what a fixed income means because you are obviously talking to someone(s) who are ignorant or you are misrepreseting their abilities.
2008-01-30 14:35:38 UTC
They work on commission so they sell you more than you can afford they don't care if you can make the payments or not just as long as they get their commission. That is why the housing market is in such terrible trouble
2008-01-30 15:24:10 UTC
Maybe tey no fixed income as something else.Most ppl dont say that, they just say their income, and go from there. Just say you have a set income.
2008-01-30 13:50:51 UTC
Fixed income refers to any type of investment that yields a regular (or fixed) return.

For example, if you borrow money and have to pay interest once a month, you have issued a fixed-income security. When a company does this, it is often called a bond or corporate bank debt (although 'preferred stock' is also sometimes considered to be fixed income). Sometimes people misspeak when they talk about fixed income, bonds actually have higher risk, while notes and bills have less risk because these are issued by Government agencies.

The term fixed income is also applied to a person's income that does not vary with each period. This can include income derived from fixed-income investments such as bonds and preferred stocks or pensions that guarantee a fixed income. When pensioners or retirees are dependent on their pension as their dominant source of income, the term "fixed income" can also carry the implication that they have relatively limited discretionary income or have little financial freedom to make large expenditures.

Fixed-income securities can be contrasted with variable return securities such as stocks. To understand the difference between stocks and bonds, you have to understand a company's motivation. A company wants to raise money, and it doesn't want to wait until it has earned enough through ongoing operations (selling products or providing services). In order for a company to grow as a business, it often must raise money; to finance an acquisition, buy equipment or land or invest in new product development. Investors will only give money to the company if they believe that they will be given something in return commensurate with the risk profile of the company. The company can either pledge a part of itself, by giving equity in the company (stock), or the company can give a promise to pay regular interest and repay principal on the loan (bond) (bank loan) or (preferred stock).

While a bond is simply a promise to pay interest on borrowed money, there is some important terminology used by the fixed-income industry:

The principal of a bond is the amount that is being lent.

The coupon is the interest that will be paid.

The maturity is the end of the bond, the date that the amount must be returned.

The issuer is the entity (company or govt.) who is borrowing the money (issuing the bond) and paying the interest (the coupon).

The issue is another term for the bond itself.

The indenture is the contract that states all of the terms of the bond.

People who invest in fixed-income securities are typically looking for a constant and secure return on their investment. For example, a retired person might like to receive a regular dependable payment to live on, but not consume principal. This person can buy a bond with their money, and use the coupon payment (the interest) as that regular dependable payment. When the bond matures or is refinanced, the person will have their money returned to them.

Interest rates change over time, based on a variety of factors, particularly rates set by the Federal Reserve. For example, if a company wants to raise $1 million and not a lot of people in the market have free cash to lend, the company will have to offer a high rate of interest (coupon) to get people to buy their bond. If there are a lot of people in the market trying to get a return on their money, the company can offer a lower coupon.

To complicate matters further, fixed income securities are actually traded on the open market, just like stocks. To understand this, first realize that bonds are usually created in round face values, for example $100,000. If the current yield (interest rate) of newly issued similar bonds is 6% per year, and you are buying a bond with a coupon rate below 6%, then you can get the bond at a discount (below face value of $100,000), which brings your rate of return on that bond to 6%. Similarly, if the coupon rate of the bond you are buying is greater than 6% you will have to pay a premium for the bond to bring the rate of return down to 6%.

There are also index-linked, fixed-income securities. The most common and an example of the highest rated variety of this kind could include Treasury Inflation Protected Securities (TIPS). This type of fixed income is adjusted to the Consumer Price Index for all urban consumers (CPI-U), and then a real yield is applied to the adjusted principal. This means that the US Treasury issues fixed income that is backed by the full faith and credit of the US Gov to outperform the CPI (e.g. to outperform the inflation rate). This allows investors of all sizes to not lose the purchasing power of their money due to inflation, which can be very uncertain at times. For example, assuming 3.88% inflation over the course of 1 year (just about the 56 year average inflation rate, through most of 2006), and a real yield of 2.61% (the fixed US Treasury real yield on October 19, 2006, for a 5 yr TIPS), the adjusted principal of the fixed income would rise from 100 to 103.88 and then the real yield would be applied to the adjusted principal, meaning 103.88 x 1.0261, which equals 106.5913; giving a total return of 6.5913%. TIPS moderately outperform conventional US Treasuries, which yield just 5.05% for a 1 yr bill on October 19, 2006. By investing in such fixed income, index linked fixed income securities, consumers can exceed the pace of inflation, and gain value in real terms.

All fixed income securities from any entity have risks including but not limited to:

inflationary risk

interest rate risk

currency risk

default risk

repayment of principal risk

reinvestment risk

liquidity risk

maturity risk

streaming income payment risk

duration risk

convexity risk

credit quality risk

political risk

tax adjustment risk

market risk
2008-01-30 12:25:51 UTC
You mean a fixed interest rate?

Because that is why everyone is losing their homes right now!

If you don't get a fixed mortgage rate your payments will surely skyrocket in the next few years.

Demand a fixed rate.
sundaizie ♥~♥
2008-01-30 12:24:24 UTC
it's hard to imagine any thinking adult type person that doesn't understand what it means to live on a fixed income...da ♥
Saudi Geoff
2008-01-30 14:10:07 UTC
Everyone? How many have you talked to? Perhaps the American educational system is not so hot after all?
Sandy B
2008-01-30 12:51:36 UTC
They tend to try to make whatever it is work...fixed is not anything they want to hear so they ignore it. They work on commission
2008-01-30 12:24:37 UTC
Most of them have never been to school and just get certified to sell houses. So they missed out on common sense 101.
2008-01-30 12:23:30 UTC
cuz they took the home tesst to become one. Most days now its so easy to get a fake real estate person. Take some home courses and Wala...
2008-01-30 12:23:30 UTC
Because they don't want to have one?
2008-01-30 12:25:22 UTC
And your point is what?
2008-01-30 19:31:40 UTC
They are just plain stupid
2008-01-30 12:23:36 UTC
Don't let them kid you, they know.
Victor A
2008-01-30 12:23:47 UTC
they are idiots, that's why.

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