Push To Consolidate Personal Debt Sparks Mortgage Refinancing Boom

Home sales activity and prices in Spokane are flat, continuing the basic pattern of the past 18 months.

Refinancing, however, has picked up sharply.

“The action is nowhere near as hectic as in 1993, when we went through our last refinancing craze,” reports Kip Clark, president of Family Home Mortgage Co. of Spokane. “But we’re seeing a lot of refinancing - not so much to reduce the interest rate on existing mortgages but more to take advantage of low-rate equity loans to consolidate personal debt.

With home mortgage rates hovering around 7.5 percent, Clark says, consumers are seizing the chance to wipe out credit card and installment loan balances on which they are paying up to 21 percent. “So even if you don’t feel a need to refinance your house at 7.5 percent,” Clark says,”you may want to refinance your overall debt at a reduced rate and strengthen your cash flow.”

Other homeowners are switching from variable rate to fixed-rate loans.

“We saw people get into various types of adjustable-rate mortgages a few years ago that make it worthwhile to convert to a low fixed-rate now,” says Clark. “If they lock in a new fixed-rate a point or so above the original variable-rate, they can pat themselves on the back for now doing the smart thing back then. But if they don’t act now, who knows?”

It’s unlikely much lower rates are in the offing, he believes.

Meantime, other real estate activity “has been maybe a little better than flat for the past 18 months or so, in Spokane. But on the other side of the Cascades, real estate is booming,” Clark says.

“Seattle, along with Portland, are identified by mortgage insurance companies as some of the stronger markets in the nation,” Clark adds.

This is good news for Spokane, says Clark, immediate past president of the state mortgage lenders association and active on several national committees in the industry.

A few years ago, when Spokane’s red hot home market posted some of the biggest percentage price increases in the nation month after month, many in the industry worried about a crash when the price spiral collapsed. But the crash never came. Prices gradually plateaued at a new higher level, just keeping up with inflation.

“This is the soft landing we were all hoping for,” says Clark. “We couldn’t be more fortunate.”

Now with Seattle and Portland housing going berserk again, can Spokane be far behind. “We generally lag those cities by a couple years,” observes Clark. “My anticipation is that we can look for more postive developments in local real estate if not late this year, then sometime in 1998.”

Coaching gains popularity

If team building is today’s business management mantra, then consultant Reed Daugherity of Spokane is a coach, which is how he describes himself.

“Today, more and more people … are choosing to work with coaches,” says the founder of Daugherity Development Resources Inc. “They have found the necessary support to achieve focus and freedom in every aspect of their lives.”

Coaching, as Daugherity sees it, is a form of consulting that is “transformational,” as distinguished from motivational. “Together, you’ll discuss limitations and opportunities. Your coach will support you and help you make your own changes.”

Coaching focuses on every aspect of the client’s life, from health concerns to career advancement, from family and friends to finances. The coach helps the client sort out which priorities to pursue.

“As a coach, I don’t have the answers for someone else,” says Daugherity. “I ask probing questions, and they come up with the answers within themselves.”

Daugherity holds a master’s degree in counseling from Arizona State University and is an adjunct faculty member of both Eastern Washington and Western Washington universities.

He says with business teams, as with individuals, building the vision is a necessary first part of the process of realizing the team’s or individual’s potential.

“I don’t tell managers how to run the company. As a coach, I tell team members: This is what I see happening within the team. How does that serve where you are going or where you want to go with the company?”

To work at an optimum level, a team must include the right mix of talent, skills and experience, says the coach. Equally important, management must ensure that others who work better independently can contribute their best efforts.

Starnes to address local chamber

U.S. Chamber of Commerce Chairman Michael Starnes will address the Spokane Area Chamber of Commerce next month.

Starnes is chairman and chief executive officer of M.S. Carrier of Memphis, Tenn., a truckload carrier throughout the United States, Canada and Mexico.

Starnes, who grew his transportation empire from a home-based business operated by just himself and his wife into a company that now employs 3,300, will speak at a Good Morning Spokane Area breakfast Oct. 10 at the Doubletree Hotel-Valley.

, DataTimes MEMO: Associate Editor Frank Bartel writes a notes column each Wednesday. If you have business items of regional interest for future columns, call 459-5467 or fax 459-5482.

The following fields overflowed: CREDIT = Frank Bartel The Spokesman-Review