Landmark State Decision in RE Agency and Disclosure Law

[bearishgurl]

[quote=pabloesqobar]Way to ignore most of my post. Even the appeals court would disagree with your characterization of a listing agent being allowed to withhold material facts. Existing law already takes care of that. The appeals court relied on existing case law when reaching their decision. [/quote]

No one’s “ignoring” your post, pablo. Prior to Holmes, “existing law” regarding RE “disclosure” only covered a property’s physical condition, status of existing permits, etc, environmental hazards, its known history and anything else which would prevent a buyer from his/her “quiet enjoyment” of said property, NOT the “condition of the title.” This is what the preliminary title report (“PR” or “PTR” is supposed to do). But to order one of these, there needs to be an escrow opened and a subsequent title order opened corresponding to that escrow. Otherwise a person would have to pay anywhere from $175 to $350 for one (such as a potential buyer of a trustee’s deed on the steps).

Why do you think this particular opinion was “Certified for Publication,” pablo? Could it be because it set a precedent in that it is now time for the condition of the TITLE to be disclosed early on (before escrow is opened), since so many titles now seem to be “clouded” or otherwise difficult or impossible to convey given their current “condition?”

[quote=pabloesqobar]I agree it’s a good ruling for buyers. But again, like everyone has repeatedly pointed out, this is not a scenario that is rampant in the industry, and therefore will have little effect – no matter how much you scream it from the rooftops or bore us with it. [/quote]

If you are “bored” with the subject matter here, pablo, you are free to move on to another thread. Seriously, it wouldn’t bother me a bit.

[quote=pabloesqobar]I don’t need to scour the internet to read random legal opinions. You do. Come talk to me after you pass law school, pass the bar exam, and actively represent buyers, sellers, agents and brokers in court in failure to disclose cases as I have. [/quote]

I guess I didn’t make myself very clear. “Opinion” is not the right word. “Commentary” is. There was plenty of “legal (and business) commentary” on this case online LONG before it was citable.

***********************************************

Good morning/afternoon/evening, pablo! For your Sunday reading enjoyment, I attach:

http://firsttuesdayjournal.com/november-article-of-the-month-holmes-v-summer-dilatory-disclosures-and-the-damage-done/
http://firsttuesdayjournal.com/dilatory-home-sales-disclosures-and-the-damage-done-holmes-v-summer-press-version/
http://www.krbecheklaw.com/2010/10/17/holmes-v-summer-fiduciary-duties-of-real-estate-broker/
http://www.zulpc.com/news/139-holmes-v-summer
http://www.airea.com/memberinfo/arbitrationcasestudy.pdf
http://www.trulia.com/voices/Home_Buying/Holmes_v_Summer_dilatory_disclosures_and_the_dam-257806
http://www.lexisnexis.com/COMMUNITY/REALESTATELAW/blogs/topcases/archive/2010/11/02/ca-court-imposes-duty-upon-seller-s-broker-to-disclose-to-buyer-that-property-is-so-over-encumbered-that-clear-title-cannot-be-conveyed-for-the-price-holmes-v-summer-10-6-2010.aspx
http://www.sellarlaw.com/2010/10/07/real-estate-brokers-and-agents-must-disclose-property-overencumbered-by-debt/
http://www.sierrasun.com/article/20101014/NEWS/101019949
http://www.cwclaw.com/publications/alertDetail.aspx?id=513
see below from http://rogerbernhardt.com/November_2010.html

3. When It Is the Seller’s Broker Who Did Not Inform the Buyers

This would have been a considerably easier case had the defendant—who was apparently the only broker in the picture—designated herself as a dual agent rather than solely agent for the sellers. That way, she would have had fiduciary duties to the buyers and made it much easier to impose disclosure duties on her. Instead, her status made the court of appeal feel compelled to go through the classic six-factor privity analysis before imposing such duties on her.

(emphasis added)

btw: I’ve also worked on more than a few broker/seller “failure to disclose” cases in my day.

[quote=pabloesqobar]Conning people out of $600 a pop to help them avoid foreclosure does not make you an expert. By the way, do you ever feel bad about that? You did it for several years and never once prevented a foreclosure, correct? [/quote]

I didn’t need to “con” anyone, pablo. I sought no “business” at all in this type of work. Like it or not, these delinquent borrowers all came crawling to me, utterly desperate, a couple of them years AFTER I told them NOT to go thru with their exotic, NINA and/or “stated income” refis with “shady” mortgage brokers, after they brought me their “Reg Z’s” (GFE’s) showing blatantly usurious rates and terms.

art of the reason why I required the borrower be present with me when we talked with their lender(s) on speakerphone is because I wanted them to SEE for themselves and KNOW what they were up against and how their lender’s collection/loss mit depts thought about their case. Since a few were “friends,” I didn’t want them later accusing me of “botching” their HAMP/Deed in Lieu and tell others that they “lost” their homes due to MY negligence or incompetence. I also wanted them to SEE how much work I was doing and how much paper it generated, etc. I wanted them HEAR me TALK to their lenders on their behalf. This enabled them, over a matter of 8-30 mos, to come down to a fairly “soft” landing off their “2005-2007 fantasy billowing cloud in the sky” and realize they had to give it up. ALL thanked me (even after moving out) and ALL are grateful they did not go to shark attorneys and get robbed for MUCH more $$. NONE wanted to sell short. All but one still had minor children living at home and wanted to live in their properties as long as humanly possible. Their years of ownership spanned 5-23 years. Only TWO were “bubble purchasers.”

FWIW, I never collected as much as “$600” from ANYONE who was behind in their payments and sought my help. In TWO of the cases I tried to help, I BARTERED with the borrowers for services. I performed at least 12 hrs work for another 2-3 borrowers who sought HAMP and took NOTHING from them and told them I could do NOTHING for them, as soon as practicable.

Assuming arguendo that I made about $3500 over 30 months assisting delinquent borrowers and given my knowledge and experience, how much do you think my time is worth, pablo? How much is YOUR time worth? Would you do this kind of work for a handful of delinquent borrowers for this sum? Is $3500 enough for you to “run and jump over??”

Compare my former $400-$500 charge and dozens of hours of work to the thousands of dollars those members of the bar charged for the same work while “not guaranteeing a particular result” (roughly over 10x times what I charged).

See: http://piggington.com/ot_funniest_foreclosure_story

and its underlying article: http://mcsweeneys.net/links/panoramaexcerpts/Ali.html as told by CA Attorney Wajahat Ali:

… “This frickin’ guy!” Carl exploded. “I gave him sixty-five hundred dollars! And you know what he did? You know what I got for sixty-five hundred dollars? He foreclosed my home! He did nothing. He wouldn’t even return my calls! Not one call!”

By this time, Carl began eyeballing me with suspicion.

“Hey… do you know what you’re doing?” he asked. “I mean, are you just going to take our money and do nothing?”

My paranoid and terrified mind went into fight-or-flight mode. I pictured Carl lunging for my jugular, his mind clouded by berserker rage as he imagined me as the attorney who had defrauded him. I scanned my friend’s office for a weapon I could use to defend myself, but noticed only a bowl of wasabi peas. I thought perhaps I could quickly fling a pea into his eye, temporarily blinding him, if he took the offensive.

Thankfully, his wife calmed him down, and the pea ended up in my mouth…

Sadly, though, the Lipkins’ tale of being thoroughly screwed by unethical attorneys preying on desperate clients is all too common. The State Bar of California has released several “ethics alerts” reminding attorneys of their professional responsibilities and of the appropriate way to deal with clients in default. The Recorder, a legal newspaper, had a cover feature on the most notorious offenders, who bilked clients out of millions and did nothing as their homes went into default, were foreclosed, and then sold on the steps of their local courthouse…

SB 94 will, though, impede certain types of fraud. The law would have prevented the Lipkins’ trouble with Rodis Law Group, the lawyers the family retained before they found Wajahat. Ron Rodis was disbarred October 15, and Rodis Law Group is under Federal Trade Commission investigation.

(emphasis added)

I’m only mentioning one name here that has tarnished your good and noble profession, pablo. You know there are many more.

In hindsight, I really probably made less than minimum wage trying to iron out these people’s intractable problems that were, 75% of the time, self-made. It really wasn’t worth it to me but I feel I helped them to get into the right mindset to move forward with their lives. And learned a few things along the way, as well. Mostly, that the persons hired or contracted by these banks as “collectors” or to administer newly-minted government “programs” geared for their delinquent borrowers, were, for the most part, supremely incompetent . . . literally . . . bumping into one another . . .

[quote=pabloesqobar]Why don’t you answer my question re the dual agency? Upon what do you base your assertion that the buyers were represented by the sellers agent? You’re very detail oriented, so I’m sure you can find it for us.[/quote]

pablo, I’m going to take that statement as a “pseudo-compliment.” Actually, “detail” is my middle name and I pride myself on my skills in this area. Thank you for your support!

As a matter of fact, I’ve recently loaded my “bestest and brightest” flashlight with fresh batteries, lol and I would hope that you do same.

(Op. p. 3) Summer is a licensed real estate broker who represented the seller of certain residential real property located in Huntington Beach, California. Summer was employed by Beneficial Services, Inc., which operated a Re/Max office in Huntington Beach.

The brokers listed the property for sale on a multiple listing service, advertising a price of $749,000 to $799,000. The listing noted that the seller was motivated and that Summer would receive a 3 percent commission for the sale. The buyers saw the listing on the multiple listing service Web site and became interested in the property. Summer showed them the property, and made no mention of any encumbrances on the property that might affect the ability of the seller to sell at the advertised price…

(Op. p 14) Turning now to moral blame, we observe that California cases recognize a fundamental duty on the part of a realtor to deal honestly and fairly with all parties in the sale transaction. Surely a sense of rudimentary fairness would dictate that buyers in a case such as this should be informed before they open escrow and position themselves to consummate the same that there is a substantial risk that title cannot be conveyed to them . . .

(Op. p. 15) Both the policy of preventing future harm and considerations of moral blame compel the imposition of a duty on the part of a realtor never to allow a desire to consummate a deal or collect a commission to take precedence over his fundamental obligation of honesty, fairness and full disclosure toward all parties…

(emphasis added)

see: http://www.courtinfo.ca.gov/opinions/documents/G041906.PDF

Any attorney representing brokers should advise them to communicate the fact that the seller’s property is underwater (i.e., the debts against the property exceed its fair market value) to potential buyers right at the start—along with any and all other possibly relevant facts. That is common sense as well as good conduct…

The court noted that Buyers were not in a position to protect themselves because it is not typical in a residential purchase for the buyer to perform a title search before making an offer. The California Association of Realtors standard form purchase contract states that the buyer will receive a preliminary title report after escrow is opened…

Even if a title search would have divulged deeds of trust, it would not have disclosed the balance owing on the promissory notes. Further, when a seller agrees to sell a property free and clear of all liens and encumbrances, the seller impliedly represents that he will be in a position to deliver title free and clear. The court also noted that even if Buyers had been on constructive notice of the liens, the seller still would have had a duty to disclose…

Brokers argued that the court’s ruling would require them to divine when a seller may have breached agreements and to disclose that to the buyer. However, the court noted that the seller’s financial situation was clear to Brokers at the time the purchase agreement was signed. When an agent or broker is aware that either a short sale requiring the cooperation of a lender or the deposit of cash by the seller will be required to release monetary liens, the agent has a duty to disclose those facts to the buyer so that the buyer can investigate further regarding the risk that the transaction will fail.

Brokers also argued that imposing this duty to disclose would require them to breach their duty of confidentiality to the seller. The court noted, however, that brokers have a duty, under CC §2079.16, to disclose confidential matters if they materially affect the desirability of entering into the transaction. Brokers also have a duty of honest and fair dealing and good faith. CC §2079.16(b).

(emphasis added)

See: http://www.krbecheklaw.com/2010/10/17/holmes-v-summer-fiduciary-duties-of-real-estate-broker/

As per Summer’s DRE license record: (current office address: 301 Main St. Huntington Beach, CA 92649)
see: http://www2.dre.ca.gov/PublicASP/pplinfo.asp?License_id=00428643

For ReMax Office located at 301 Main St. Huntington Beach, CA 92649
see: http://www.stockteam.com/remax-real-estate-huntington.html

Any person a “notch above a dimwit “ (SDR’s words) could “infer” from the information provided here plus 1.5 mins “surfing the net” that Summer was acting as a dual agent as, from the opinion, she appears to also be the “procuring” agent/broker in this case.

pablo, as an aside, can I just inquire, what do you mean by “marionesque?” Does it have to do with “puppets??” I’m a “dimwit” about these things, so . . . just wondering . . . why don’t you “enlighten” me?

[urbanrealtor]

Okay.
That’s it.
I have had enough.

1: Preliminary title reports (PR’s) are easy to get.

You totally don’t have to have an active transaction for a PR. I get them all the time for my short sale listings before I have a buyer.

2: A PR is not an authoritative statement of encumbrance.

A PR will generally show trust deeds and liens but not demands. Since you never know how much a place is encumbered without a demand, the PR is not much better than just the public records (or Realist). Generally a demand is lower than the full value (in my experience) showing on the PR. Further, if there were other non-liened obligations (eg: a year of back HOA dues) they might not even show up on a PR. Fail.

3: Banks can add stuff in that is not known to anyone.

I just closed a buyer’s purchase in Murrieta. The seller had $50k of equity. They had lost some of their income and could not keep up. Wells put them through no less than 5 different modifcation programs (all the while telling them not to pay). Eventually, the sellers got frustrated and gave up. When they sold to my clients, the bank added in over $40k in fees for non-payment (non-payment which was done at the bank’s direction). Those fees were in excess of liened amounts and did not show on any PR or public record. It meant the sellers walked with $5k instead of $50k.

4: The duty does not change.

The agent’s duty is still to show all the warts of which he is aware. Even if he was banging both the buyer and seller simultaneously, he still failed utterly to disclose a known material fact. Specifically, he concealed major negative equity to a client.

[urbanrealtor]

Okay.
That’s it.
I have had enough.

1: Preliminary title reports (PR’s) are easy to get.

You totally don’t have to have an active transaction for a PR. I get them all the time for my short sale listings before I have a buyer.

2: A PR is not an authoritative statement of encumbrance.

A PR will generally show trust deeds and liens but not demands. Since you never know how much a place is encumbered without a demand, the PR is not much better than just the public records (or Realist). Generally a demand is lower than the full value (in my experience) showing on the PR. Further, if there were other non-liened obligations (eg: a year of back HOA dues) they might not even show up on a PR. Fail.

3: Banks can add stuff in that is not known to anyone.

I just closed a buyer’s purchase in Murrieta. The seller had $50k of equity. They had lost some of their income and could not keep up. Wells put them through no less than 5 different modifcation programs (all the while telling them not to pay). Eventually, the sellers got frustrated and gave up. When they sold to my clients, the bank added in over $40k in fees for non-payment (non-payment which was done at the bank’s direction). Those fees were in excess of liened amounts and did not show on any PR or public record. It meant the sellers walked with $5k instead of $50k.

4: The duty does not change.

The agent’s duty is still to show all the warts of which he is aware. Even if he was banging both the buyer and seller simultaneously, he still failed utterly to disclose a known material fact. Specifically, he concealed major negative equity to a client.

[urbanrealtor]

Okay.
That’s it.
I have had enough.

1: Preliminary title reports (PR’s) are easy to get.

You totally don’t have to have an active transaction for a PR. I get them all the time for my short sale listings before I have a buyer.

2: A PR is not an authoritative statement of encumbrance.

A PR will generally show trust deeds and liens but not demands. Since you never know how much a place is encumbered without a demand, the PR is not much better than just the public records (or Realist). Generally a demand is lower than the full value (in my experience) showing on the PR. Further, if there were other non-liened obligations (eg: a year of back HOA dues) they might not even show up on a PR. Fail.

3: Banks can add stuff in that is not known to anyone.

I just closed a buyer’s purchase in Murrieta. The seller had $50k of equity. They had lost some of their income and could not keep up. Wells put them through no less than 5 different modifcation programs (all the while telling them not to pay). Eventually, the sellers got frustrated and gave up. When they sold to my clients, the bank added in over $40k in fees for non-payment (non-payment which was done at the bank’s direction). Those fees were in excess of liened amounts and did not show on any PR or public record. It meant the sellers walked with $5k instead of $50k.

4: The duty does not change.

The agent’s duty is still to show all the warts of which he is aware. Even if he was banging both the buyer and seller simultaneously, he still failed utterly to disclose a known material fact. Specifically, he concealed major negative equity to a client.

[urbanrealtor]

Okay.
That’s it.
I have had enough.

1: Preliminary title reports (PR’s) are easy to get.

You totally don’t have to have an active transaction for a PR. I get them all the time for my short sale listings before I have a buyer.

2: A PR is not an authoritative statement of encumbrance.

A PR will generally show trust deeds and liens but not demands. Since you never know how much a place is encumbered without a demand, the PR is not much better than just the public records (or Realist). Generally a demand is lower than the full value (in my experience) showing on the PR. Further, if there were other non-liened obligations (eg: a year of back HOA dues) they might not even show up on a PR. Fail.

3: Banks can add stuff in that is not known to anyone.

I just closed a buyer’s purchase in Murrieta. The seller had $50k of equity. They had lost some of their income and could not keep up. Wells put them through no less than 5 different modifcation programs (all the while telling them not to pay). Eventually, the sellers got frustrated and gave up. When they sold to my clients, the bank added in over $40k in fees for non-payment (non-payment which was done at the bank’s direction). Those fees were in excess of liened amounts and did not show on any PR or public record. It meant the sellers walked with $5k instead of $50k.

4: The duty does not change.

The agent’s duty is still to show all the warts of which he is aware. Even if he was banging both the buyer and seller simultaneously, he still failed utterly to disclose a known material fact. Specifically, he concealed major negative equity to a client.

[urbanrealtor]

Okay.
That’s it.
I have had enough.

1: Preliminary title reports (PR’s) are easy to get.

You totally don’t have to have an active transaction for a PR. I get them all the time for my short sale listings before I have a buyer.

2: A PR is not an authoritative statement of encumbrance.

A PR will generally show trust deeds and liens but not demands. Since you never know how much a place is encumbered without a demand, the PR is not much better than just the public records (or Realist). Generally a demand is lower than the full value (in my experience) showing on the PR. Further, if there were other non-liened obligations (eg: a year of back HOA dues) they might not even show up on a PR. Fail.

3: Banks can add stuff in that is not known to anyone.

I just closed a buyer’s purchase in Murrieta. The seller had $50k of equity. They had lost some of their income and could not keep up. Wells put them through no less than 5 different modifcation programs (all the while telling them not to pay). Eventually, the sellers got frustrated and gave up. When they sold to my clients, the bank added in over $40k in fees for non-payment (non-payment which was done at the bank’s direction). Those fees were in excess of liened amounts and did not show on any PR or public record. It meant the sellers walked with $5k instead of $50k.

4: The duty does not change.

The agent’s duty is still to show all the warts of which he is aware. Even if he was banging both the buyer and seller simultaneously, he still failed utterly to disclose a known material fact. Specifically, he concealed major negative equity to a client.

[bearishgurl]

[quote=SD Realtor]Tell us all, since you have been licensed so long, when exactly was your last transaction? In fact when was your last short sale?[/quote]

My last “transaction” was in late 2002. My last “short sale” was in 1993. It took approx 153 days to close. Even with the thousands of bureaucratic know-nothing paper pushers that “big banks” have hired today (with their “govm’t bailout money”) to administer “borrower assistance” programs and the extra HUD and CAR form(s) more recently invented for “short sales,” I’m not hearing that these transactions close much, if ANY sooner than they did in ’92 – ’93. Buyers DID submit earnest $$ checks with their offers to purchase and they WERE deposited into escrow back then. However, the “short” that lenders were asked to take in ’93 was relatively small compared to what they are typically asked to accept today.

[quote=SDRealtor]. . . The entire premise of your rants have been that buyers spend lots of money before they find out about liens. This is a blatant falsehood. All I am asserting is that what you are saying is not true. The court case is fine and I hope that agent gets what is coming to them.

I am attacking you for making statements about buyers putting out alot of money before being able to find out liens in a short sale.[/quote]

SDR, WHERE have I stated here that “buyers” are “putting out alot of money?” Am I missing something?? Sure, I have no doubt that current “buyers” and their agents are wasting their time on short sales that never materialize when they COULD be engaged in a sale transaction that the seller has the power to close. I don’t think that the “convenience factor” amounts to “damages” however. In Holmes, above, I “assumed” the Holmeses deposited earnest money because the property was not marketed as a “short sale.” Presumably, escrow was opened a “regular” or “traditional” sale. The Holmeses did not learn their escrow was to be a “short-sale” until well into it. Perhaps, in an effort to provide some sort of “headnote” (when one didn’t yet exist), I improperly stated that the Holmeses “lost their earnest $$.” In fact, the opinion is not clear as to how much, if any, earnest money they deposited and when (or if) they received a refund. Unless we go up to the OC and watch the trial, we will never know. (If ReMax/Summer were smart, they’d settle this thing in a dark conference room, fast and put it behind them, lol.) For this “assumption,” it appears I may have “jumped the gun” here and apologize. In my experience, buyers who terminated escrows engaged in arbitration with the seller when they believed they should have received a refund of 100% of their earnest money deposit and did not.

Do any Piggs have access to Westlaw/Lexis? If so, can you post the headnote describing the “holding” of Holmes v Summer (2010) 188 Cal.App.4th 1510. Thanks for any contribution.

[quote=SDRealtor]Just because an escrow is opened doesn’t mean a thing. The buyer does not have to spend a penny. Contingencies have not started in a short sale until written approval is obtained from the lender/lenders involved. Everything can be found out (and usually is found out) weeks and even months before the approval is completed.[/quote]

This is entirely the point of this thread and my point as well. Many sellers and their agents today are taking escrow “too lightly,” often due to recalcitrant lenders whom they are “hopeful” will take voluntary “haircuts” at some point in the near future.

10+ years ago, when each purchase offer packet of CAR forms (legal size, in NCR quadruplicate) was $7.50, as agents, we didn’t waste time and money making a bunch of “random offers” at once to see if they stick and then tell our clients to keep looking while they are presumably “in escrow.” Being “in escrow” meant you were in contract to purchase property. The “shopping” was over. Your earnest money check was deposited. Sellers/buyers had a duty to perform.

I know that CAR forms, including the purchase offer, counter offer and the Exclusive Authorization and Right to Sell packet are in software pkgs now, because I am a subscriber. I know an agent can just type in the blanks and submit offers randomly, at no cost. I know they can now transmit these offers electronically. I know that original signatures are no longer needed right away. I know agents don’t have to visit mail drops around town at 10:00 pm to submit offers anymore. I am aware that current buyers don’t post an earnest $$ money deposit on short sales (and then listing agents complain they walk too much, lol). What do they expect?? Are all these machinations a “streamlined” way to do business today or does it invite “breach” and “walking?” Does the current “system” work, SDR??

[quote=SD Realtor]Your assertions that buyers are putting out money because they cannot find out this information are false. You are telling a lie. Your other allegations about short sales falling through because of your litany of judgements and other reasons… well I will ask you AGAIN…you said you were going to talk to realtors and find out about how many transactions this occurred in? Well? I am still waiting.[/quote]

I’m still working on this and will post what I learn here on this thread.

[quote=SDRealtor]I am not taking anything personally. I am one of a few people who can call you out on this. The bottom line is you know deep down that buyers can find out all of this information and instead of saying, “yes buyers can find out about this” you would rather do anything you can to not say that.[/quote]

Yes, a buyer can find out about liens prior to making an offer IF the seller’s name is not too common, IF they have proper middle initials and IF they have other personal info about the seller at their disposal to assist them (esp if the seller has a common name) and IF they or their agent know how to properly search the title at the recorder’s office or thru a subscription service. Many buyers and agents don’t. This “talent” (and it is a talent, btw), is not required to be an agent or even a broker in CA. That is why we have title companies. If buyers knew of the liens in advance they could structure their offers as to those liens and demand that they be cured/removed as a condition of sale. This IS easier to do for a buyer now that the last 29 years of ARCC records are available online. This didn’t used to be the case. Microfilm and cloth binders, anyone?? Got an extra week to “train?” If so, break out the running shoes.

However, here in SD County, ARCC doesn’t tell the WHOLE story about a delinquent seller. Sellers who are behind in their mtg payments quite often have other problems with debt. They (and non-property owners) are often sued and never respond. Unbeknownst to these seller-defendants, these collectors get default judgments against them, sometimes to the tune of several per day per courthouse. When defendant-debtors are mailed the entry of judgment by the clerk, they often don’t know what it is so they bring it to someone like me and ask. They often have no $$ to pay them, anyway. These creditors have to wait to get their judgment entered. Then they have to wait a longer period to get an abstract issued. While they are waiting, they are often trying to work out a payment plan with the judgment debtor, sometimes discounting the debt. All of this may be going on in the “back room” simultaneous to these sellers’ short-sale escrow with bona-fide buyers. These debts would NOT show up on a PR as “encumbrances to real property” but could scotch a deal at the 11th hour if the seller is uncooperative with their judgment creditors and/or the short-sale escrow drags on long enough. When a judgment creditor becomes pissed and/or loses contact with the judgment debtor, they file their already-issued abstract with no further ado, as is their right. They may or may not know that the debtor’s property is in escrow, they may not care and it doesn’t matter. This “deadbeat” seller may not understand that this judgment creditor has the power to shut their escrow down. They may not have even told their listing agent about the debt.

In light of the current market, I feel today’s buyer’s motto should be, “When a seller can no longer make their payments and want a buyer to `rescue’ them from foreclosure via a `short sale,’ DIG DEEPER.”

It COULD be a “race against time” with some of these “short sale” sellers to close before more “creditors” enter the mix.

SDR, as a buyer, would YOU want to enter a “short-sale” transaction without knowing everything possible about the seller relative to the current or future marketability of their title?? I certainly wouldn’t.

[bearishgurl]

[quote=SD Realtor]Tell us all, since you have been licensed so long, when exactly was your last transaction? In fact when was your last short sale?[/quote]

My last “transaction” was in late 2002. My last “short sale” was in 1993. It took approx 153 days to close. Even with the thousands of bureaucratic know-nothing paper pushers that “big banks” have hired today (with their “govm’t bailout money”) to administer “borrower assistance” programs and the extra HUD and CAR form(s) more recently invented for “short sales,” I’m not hearing that these transactions close much, if ANY sooner than they did in ’92 – ’93. Buyers DID submit earnest $$ checks with their offers to purchase and they WERE deposited into escrow back then. However, the “short” that lenders were asked to take in ’93 was relatively small compared to what they are typically asked to accept today.

[quote=SDRealtor]. . . The entire premise of your rants have been that buyers spend lots of money before they find out about liens. This is a blatant falsehood. All I am asserting is that what you are saying is not true. The court case is fine and I hope that agent gets what is coming to them.

I am attacking you for making statements about buyers putting out alot of money before being able to find out liens in a short sale.[/quote]

SDR, WHERE have I stated here that “buyers” are “putting out alot of money?” Am I missing something?? Sure, I have no doubt that current “buyers” and their agents are wasting their time on short sales that never materialize when they COULD be engaged in a sale transaction that the seller has the power to close. I don’t think that the “convenience factor” amounts to “damages” however. In Holmes, above, I “assumed” the Holmeses deposited earnest money because the property was not marketed as a “short sale.” Presumably, escrow was opened a “regular” or “traditional” sale. The Holmeses did not learn their escrow was to be a “short-sale” until well into it. Perhaps, in an effort to provide some sort of “headnote” (when one didn’t yet exist), I improperly stated that the Holmeses “lost their earnest $$.” In fact, the opinion is not clear as to how much, if any, earnest money they deposited and when (or if) they received a refund. Unless we go up to the OC and watch the trial, we will never know. (If ReMax/Summer were smart, they’d settle this thing in a dark conference room, fast and put it behind them, lol.) For this “assumption,” it appears I may have “jumped the gun” here and apologize. In my experience, buyers who terminated escrows engaged in arbitration with the seller when they believed they should have received a refund of 100% of their earnest money deposit and did not.

Do any Piggs have access to Westlaw/Lexis? If so, can you post the headnote describing the “holding” of Holmes v Summer (2010) 188 Cal.App.4th 1510. Thanks for any contribution.

[quote=SDRealtor]Just because an escrow is opened doesn’t mean a thing. The buyer does not have to spend a penny. Contingencies have not started in a short sale until written approval is obtained from the lender/lenders involved. Everything can be found out (and usually is found out) weeks and even months before the approval is completed.[/quote]

This is entirely the point of this thread and my point as well. Many sellers and their agents today are taking escrow “too lightly,” often due to recalcitrant lenders whom they are “hopeful” will take voluntary “haircuts” at some point in the near future.

10+ years ago, when each purchase offer packet of CAR forms (legal size, in NCR quadruplicate) was $7.50, as agents, we didn’t waste time and money making a bunch of “random offers” at once to see if they stick and then tell our clients to keep looking while they are presumably “in escrow.” Being “in escrow” meant you were in contract to purchase property. The “shopping” was over. Your earnest money check was deposited. Sellers/buyers had a duty to perform.

I know that CAR forms, including the purchase offer, counter offer and the Exclusive Authorization and Right to Sell packet are in software pkgs now, because I am a subscriber. I know an agent can just type in the blanks and submit offers randomly, at no cost. I know they can now transmit these offers electronically. I know that original signatures are no longer needed right away. I know agents don’t have to visit mail drops around town at 10:00 pm to submit offers anymore. I am aware that current buyers don’t post an earnest $$ money deposit on short sales (and then listing agents complain they walk too much, lol). What do they expect?? Are all these machinations a “streamlined” way to do business today or does it invite “breach” and “walking?” Does the current “system” work, SDR??

[quote=SD Realtor]Your assertions that buyers are putting out money because they cannot find out this information are false. You are telling a lie. Your other allegations about short sales falling through because of your litany of judgements and other reasons… well I will ask you AGAIN…you said you were going to talk to realtors and find out about how many transactions this occurred in? Well? I am still waiting.[/quote]

I’m still working on this and will post what I learn here on this thread.

[quote=SDRealtor]I am not taking anything personally. I am one of a few people who can call you out on this. The bottom line is you know deep down that buyers can find out all of this information and instead of saying, “yes buyers can find out about this” you would rather do anything you can to not say that.[/quote]

Yes, a buyer can find out about liens prior to making an offer IF the seller’s name is not too common, IF they have proper middle initials and IF they have other personal info about the seller at their disposal to assist them (esp if the seller has a common name) and IF they or their agent know how to properly search the title at the recorder’s office or thru a subscription service. Many buyers and agents don’t. This “talent” (and it is a talent, btw), is not required to be an agent or even a broker in CA. That is why we have title companies. If buyers knew of the liens in advance they could structure their offers as to those liens and demand that they be cured/removed as a condition of sale. This IS easier to do for a buyer now that the last 29 years of ARCC records are available online. This didn’t used to be the case. Microfilm and cloth binders, anyone?? Got an extra week to “train?” If so, break out the running shoes.

However, here in SD County, ARCC doesn’t tell the WHOLE story about a delinquent seller. Sellers who are behind in their mtg payments quite often have other problems with debt. They (and non-property owners) are often sued and never respond. Unbeknownst to these seller-defendants, these collectors get default judgments against them, sometimes to the tune of several per day per courthouse. When defendant-debtors are mailed the entry of judgment by the clerk, they often don’t know what it is so they bring it to someone like me and ask. They often have no $$ to pay them, anyway. These creditors have to wait to get their judgment entered. Then they have to wait a longer period to get an abstract issued. While they are waiting, they are often trying to work out a payment plan with the judgment debtor, sometimes discounting the debt. All of this may be going on in the “back room” simultaneous to these sellers’ short-sale escrow with bona-fide buyers. These debts would NOT show up on a PR as “encumbrances to real property” but could scotch a deal at the 11th hour if the seller is uncooperative with their judgment creditors and/or the short-sale escrow drags on long enough. When a judgment creditor becomes pissed and/or loses contact with the judgment debtor, they file their already-issued abstract with no further ado, as is their right. They may or may not know that the debtor’s property is in escrow, they may not care and it doesn’t matter. This “deadbeat” seller may not understand that this judgment creditor has the power to shut their escrow down. They may not have even told their listing agent about the debt.

In light of the current market, I feel today’s buyer’s motto should be, “When a seller can no longer make their payments and want a buyer to `rescue’ them from foreclosure via a `short sale,’ DIG DEEPER.”

It COULD be a “race against time” with some of these “short sale” sellers to close before more “creditors” enter the mix.

SDR, as a buyer, would YOU want to enter a “short-sale” transaction without knowing everything possible about the seller relative to the current or future marketability of their title?? I certainly wouldn’t.

[bearishgurl]

[quote=SD Realtor]Tell us all, since you have been licensed so long, when exactly was your last transaction? In fact when was your last short sale?[/quote]

My last “transaction” was in late 2002. My last “short sale” was in 1993. It took approx 153 days to close. Even with the thousands of bureaucratic know-nothing paper pushers that “big banks” have hired today (with their “govm’t bailout money”) to administer “borrower assistance” programs and the extra HUD and CAR form(s) more recently invented for “short sales,” I’m not hearing that these transactions close much, if ANY sooner than they did in ’92 – ’93. Buyers DID submit earnest $$ checks with their offers to purchase and they WERE deposited into escrow back then. However, the “short” that lenders were asked to take in ’93 was relatively small compared to what they are typically asked to accept today.

[quote=SDRealtor]. . . The entire premise of your rants have been that buyers spend lots of money before they find out about liens. This is a blatant falsehood. All I am asserting is that what you are saying is not true. The court case is fine and I hope that agent gets what is coming to them.

I am attacking you for making statements about buyers putting out alot of money before being able to find out liens in a short sale.[/quote]

SDR, WHERE have I stated here that “buyers” are “putting out alot of money?” Am I missing something?? Sure, I have no doubt that current “buyers” and their agents are wasting their time on short sales that never materialize when they COULD be engaged in a sale transaction that the seller has the power to close. I don’t think that the “convenience factor” amounts to “damages” however. In Holmes, above, I “assumed” the Holmeses deposited earnest money because the property was not marketed as a “short sale.” Presumably, escrow was opened a “regular” or “traditional” sale. The Holmeses did not learn their escrow was to be a “short-sale” until well into it. Perhaps, in an effort to provide some sort of “headnote” (when one didn’t yet exist), I improperly stated that the Holmeses “lost their earnest $$.” In fact, the opinion is not clear as to how much, if any, earnest money they deposited and when (or if) they received a refund. Unless we go up to the OC and watch the trial, we will never know. (If ReMax/Summer were smart, they’d settle this thing in a dark conference room, fast and put it behind them, lol.) For this “assumption,” it appears I may have “jumped the gun” here and apologize. In my experience, buyers who terminated escrows engaged in arbitration with the seller when they believed they should have received a refund of 100% of their earnest money deposit and did not.

Do any Piggs have access to Westlaw/Lexis? If so, can you post the headnote describing the “holding” of Holmes v Summer (2010) 188 Cal.App.4th 1510. Thanks for any contribution.

[quote=SDRealtor]Just because an escrow is opened doesn’t mean a thing. The buyer does not have to spend a penny. Contingencies have not started in a short sale until written approval is obtained from the lender/lenders involved. Everything can be found out (and usually is found out) weeks and even months before the approval is completed.[/quote]

This is entirely the point of this thread and my point as well. Many sellers and their agents today are taking escrow “too lightly,” often due to recalcitrant lenders whom they are “hopeful” will take voluntary “haircuts” at some point in the near future.

10+ years ago, when each purchase offer packet of CAR forms (legal size, in NCR quadruplicate) was $7.50, as agents, we didn’t waste time and money making a bunch of “random offers” at once to see if they stick and then tell our clients to keep looking while they are presumably “in escrow.” Being “in escrow” meant you were in contract to purchase property. The “shopping” was over. Your earnest money check was deposited. Sellers/buyers had a duty to perform.

I know that CAR forms, including the purchase offer, counter offer and the Exclusive Authorization and Right to Sell packet are in software pkgs now, because I am a subscriber. I know an agent can just type in the blanks and submit offers randomly, at no cost. I know they can now transmit these offers electronically. I know that original signatures are no longer needed right away. I know agents don’t have to visit mail drops around town at 10:00 pm to submit offers anymore. I am aware that current buyers don’t post an earnest $$ money deposit on short sales (and then listing agents complain they walk too much, lol). What do they expect?? Are all these machinations a “streamlined” way to do business today or does it invite “breach” and “walking?” Does the current “system” work, SDR??

[quote=SD Realtor]Your assertions that buyers are putting out money because they cannot find out this information are false. You are telling a lie. Your other allegations about short sales falling through because of your litany of judgements and other reasons… well I will ask you AGAIN…you said you were going to talk to realtors and find out about how many transactions this occurred in? Well? I am still waiting.[/quote]

I’m still working on this and will post what I learn here on this thread.

[quote=SDRealtor]I am not taking anything personally. I am one of a few people who can call you out on this. The bottom line is you know deep down that buyers can find out all of this information and instead of saying, “yes buyers can find out about this” you would rather do anything you can to not say that.[/quote]

Yes, a buyer can find out about liens prior to making an offer IF the seller’s name is not too common, IF they have proper middle initials and IF they have other personal info about the seller at their disposal to assist them (esp if the seller has a common name) and IF they or their agent know how to properly search the title at the recorder’s office or thru a subscription service. Many buyers and agents don’t. This “talent” (and it is a talent, btw), is not required to be an agent or even a broker in CA. That is why we have title companies. If buyers knew of the liens in advance they could structure their offers as to those liens and demand that they be cured/removed as a condition of sale. This IS easier to do for a buyer now that the last 29 years of ARCC records are available online. This didn’t used to be the case. Microfilm and cloth binders, anyone?? Got an extra week to “train?” If so, break out the running shoes.

However, here in SD County, ARCC doesn’t tell the WHOLE story about a delinquent seller. Sellers who are behind in their mtg payments quite often have other problems with debt. They (and non-property owners) are often sued and never respond. Unbeknownst to these seller-defendants, these collectors get default judgments against them, sometimes to the tune of several per day per courthouse. When defendant-debtors are mailed the entry of judgment by the clerk, they often don’t know what it is so they bring it to someone like me and ask. They often have no $$ to pay them, anyway. These creditors have to wait to get their judgment entered. Then they have to wait a longer period to get an abstract issued. While they are waiting, they are often trying to work out a payment plan with the judgment debtor, sometimes discounting the debt. All of this may be going on in the “back room” simultaneous to these sellers’ short-sale escrow with bona-fide buyers. These debts would NOT show up on a PR as “encumbrances to real property” but could scotch a deal at the 11th hour if the seller is uncooperative with their judgment creditors and/or the short-sale escrow drags on long enough. When a judgment creditor becomes pissed and/or loses contact with the judgment debtor, they file their already-issued abstract with no further ado, as is their right. They may or may not know that the debtor’s property is in escrow, they may not care and it doesn’t matter. This “deadbeat” seller may not understand that this judgment creditor has the power to shut their escrow down. They may not have even told their listing agent about the debt.

In light of the current market, I feel today’s buyer’s motto should be, “When a seller can no longer make their payments and want a buyer to `rescue’ them from foreclosure via a `short sale,’ DIG DEEPER.”

It COULD be a “race against time” with some of these “short sale” sellers to close before more “creditors” enter the mix.

SDR, as a buyer, would YOU want to enter a “short-sale” transaction without knowing everything possible about the seller relative to the current or future marketability of their title?? I certainly wouldn’t.

[bearishgurl]

[quote=SD Realtor]Tell us all, since you have been licensed so long, when exactly was your last transaction? In fact when was your last short sale?[/quote]

My last “transaction” was in late 2002. My last “short sale” was in 1993. It took approx 153 days to close. Even with the thousands of bureaucratic know-nothing paper pushers that “big banks” have hired today (with their “govm’t bailout money”) to administer “borrower assistance” programs and the extra HUD and CAR form(s) more recently invented for “short sales,” I’m not hearing that these transactions close much, if ANY sooner than they did in ’92 – ’93. Buyers DID submit earnest $$ checks with their offers to purchase and they WERE deposited into escrow back then. However, the “short” that lenders were asked to take in ’93 was relatively small compared to what they are typically asked to accept today.

[quote=SDRealtor]. . . The entire premise of your rants have been that buyers spend lots of money before they find out about liens. This is a blatant falsehood. All I am asserting is that what you are saying is not true. The court case is fine and I hope that agent gets what is coming to them.

I am attacking you for making statements about buyers putting out alot of money before being able to find out liens in a short sale.[/quote]

SDR, WHERE have I stated here that “buyers” are “putting out alot of money?” Am I missing something?? Sure, I have no doubt that current “buyers” and their agents are wasting their time on short sales that never materialize when they COULD be engaged in a sale transaction that the seller has the power to close. I don’t think that the “convenience factor” amounts to “damages” however. In Holmes, above, I “assumed” the Holmeses deposited earnest money because the property was not marketed as a “short sale.” Presumably, escrow was opened a “regular” or “traditional” sale. The Holmeses did not learn their escrow was to be a “short-sale” until well into it. Perhaps, in an effort to provide some sort of “headnote” (when one didn’t yet exist), I improperly stated that the Holmeses “lost their earnest $$.” In fact, the opinion is not clear as to how much, if any, earnest money they deposited and when (or if) they received a refund. Unless we go up to the OC and watch the trial, we will never know. (If ReMax/Summer were smart, they’d settle this thing in a dark conference room, fast and put it behind them, lol.) For this “assumption,” it appears I may have “jumped the gun” here and apologize. In my experience, buyers who terminated escrows engaged in arbitration with the seller when they believed they should have received a refund of 100% of their earnest money deposit and did not.

Do any Piggs have access to Westlaw/Lexis? If so, can you post the headnote describing the “holding” of Holmes v Summer (2010) 188 Cal.App.4th 1510. Thanks for any contribution.

[quote=SDRealtor]Just because an escrow is opened doesn’t mean a thing. The buyer does not have to spend a penny. Contingencies have not started in a short sale until written approval is obtained from the lender/lenders involved. Everything can be found out (and usually is found out) weeks and even months before the approval is completed.[/quote]

This is entirely the point of this thread and my point as well. Many sellers and their agents today are taking escrow “too lightly,” often due to recalcitrant lenders whom they are “hopeful” will take voluntary “haircuts” at some point in the near future.

10+ years ago, when each purchase offer packet of CAR forms (legal size, in NCR quadruplicate) was $7.50, as agents, we didn’t waste time and money making a bunch of “random offers” at once to see if they stick and then tell our clients to keep looking while they are presumably “in escrow.” Being “in escrow” meant you were in contract to purchase property. The “shopping” was over. Your earnest money check was deposited. Sellers/buyers had a duty to perform.

I know that CAR forms, including the purchase offer, counter offer and the Exclusive Authorization and Right to Sell packet are in software pkgs now, because I am a subscriber. I know an agent can just type in the blanks and submit offers randomly, at no cost. I know they can now transmit these offers electronically. I know that original signatures are no longer needed right away. I know agents don’t have to visit mail drops around town at 10:00 pm to submit offers anymore. I am aware that current buyers don’t post an earnest $$ money deposit on short sales (and then listing agents complain they walk too much, lol). What do they expect?? Are all these machinations a “streamlined” way to do business today or does it invite “breach” and “walking?” Does the current “system” work, SDR??

[quote=SD Realtor]Your assertions that buyers are putting out money because they cannot find out this information are false. You are telling a lie. Your other allegations about short sales falling through because of your litany of judgements and other reasons… well I will ask you AGAIN…you said you were going to talk to realtors and find out about how many transactions this occurred in? Well? I am still waiting.[/quote]

I’m still working on this and will post what I learn here on this thread.

[quote=SDRealtor]I am not taking anything personally. I am one of a few people who can call you out on this. The bottom line is you know deep down that buyers can find out all of this information and instead of saying, “yes buyers can find out about this” you would rather do anything you can to not say that.[/quote]

Yes, a buyer can find out about liens prior to making an offer IF the seller’s name is not too common, IF they have proper middle initials and IF they have other personal info about the seller at their disposal to assist them (esp if the seller has a common name) and IF they or their agent know how to properly search the title at the recorder’s office or thru a subscription service. Many buyers and agents don’t. This “talent” (and it is a talent, btw), is not required to be an agent or even a broker in CA. That is why we have title companies. If buyers knew of the liens in advance they could structure their offers as to those liens and demand that they be cured/removed as a condition of sale. This IS easier to do for a buyer now that the last 29 years of ARCC records are available online. This didn’t used to be the case. Microfilm and cloth binders, anyone?? Got an extra week to “train?” If so, break out the running shoes.

However, here in SD County, ARCC doesn’t tell the WHOLE story about a delinquent seller. Sellers who are behind in their mtg payments quite often have other problems with debt. They (and non-property owners) are often sued and never respond. Unbeknownst to these seller-defendants, these collectors get default judgments against them, sometimes to the tune of several per day per courthouse. When defendant-debtors are mailed the entry of judgment by the clerk, they often don’t know what it is so they bring it to someone like me and ask. They often have no $$ to pay them, anyway. These creditors have to wait to get their judgment entered. Then they have to wait a longer period to get an abstract issued. While they are waiting, they are often trying to work out a payment plan with the judgment debtor, sometimes discounting the debt. All of this may be going on in the “back room” simultaneous to these sellers’ short-sale escrow with bona-fide buyers. These debts would NOT show up on a PR as “encumbrances to real property” but could scotch a deal at the 11th hour if the seller is uncooperative with their judgment creditors and/or the short-sale escrow drags on long enough. When a judgment creditor becomes pissed and/or loses contact with the judgment debtor, they file their already-issued abstract with no further ado, as is their right. They may or may not know that the debtor’s property is in escrow, they may not care and it doesn’t matter. This “deadbeat” seller may not understand that this judgment creditor has the power to shut their escrow down. They may not have even told their listing agent about the debt.

In light of the current market, I feel today’s buyer’s motto should be, “When a seller can no longer make their payments and want a buyer to `rescue’ them from foreclosure via a `short sale,’ DIG DEEPER.”

It COULD be a “race against time” with some of these “short sale” sellers to close before more “creditors” enter the mix.

SDR, as a buyer, would YOU want to enter a “short-sale” transaction without knowing everything possible about the seller relative to the current or future marketability of their title?? I certainly wouldn’t.

[bearishgurl]

[quote=SD Realtor]Tell us all, since you have been licensed so long, when exactly was your last transaction? In fact when was your last short sale?[/quote]

My last “transaction” was in late 2002. My last “short sale” was in 1993. It took approx 153 days to close. Even with the thousands of bureaucratic know-nothing paper pushers that “big banks” have hired today (with their “govm’t bailout money”) to administer “borrower assistance” programs and the extra HUD and CAR form(s) more recently invented for “short sales,” I’m not hearing that these transactions close much, if ANY sooner than they did in ’92 – ’93. Buyers DID submit earnest $$ checks with their offers to purchase and they WERE deposited into escrow back then. However, the “short” that lenders were asked to take in ’93 was relatively small compared to what they are typically asked to accept today.

[quote=SDRealtor]. . . The entire premise of your rants have been that buyers spend lots of money before they find out about liens. This is a blatant falsehood. All I am asserting is that what you are saying is not true. The court case is fine and I hope that agent gets what is coming to them.

I am attacking you for making statements about buyers putting out alot of money before being able to find out liens in a short sale.[/quote]

SDR, WHERE have I stated here that “buyers” are “putting out alot of money?” Am I missing something?? Sure, I have no doubt that current “buyers” and their agents are wasting their time on short sales that never materialize when they COULD be engaged in a sale transaction that the seller has the power to close. I don’t think that the “convenience factor” amounts to “damages” however. In Holmes, above, I “assumed” the Holmeses deposited earnest money because the property was not marketed as a “short sale.” Presumably, escrow was opened a “regular” or “traditional” sale. The Holmeses did not learn their escrow was to be a “short-sale” until well into it. Perhaps, in an effort to provide some sort of “headnote” (when one didn’t yet exist), I improperly stated that the Holmeses “lost their earnest $$.” In fact, the opinion is not clear as to how much, if any, earnest money they deposited and when (or if) they received a refund. Unless we go up to the OC and watch the trial, we will never know. (If ReMax/Summer were smart, they’d settle this thing in a dark conference room, fast and put it behind them, lol.) For this “assumption,” it appears I may have “jumped the gun” here and apologize. In my experience, buyers who terminated escrows engaged in arbitration with the seller when they believed they should have received a refund of 100% of their earnest money deposit and did not.

Do any Piggs have access to Westlaw/Lexis? If so, can you post the headnote describing the “holding” of Holmes v Summer (2010) 188 Cal.App.4th 1510. Thanks for any contribution.

[quote=SDRealtor]Just because an escrow is opened doesn’t mean a thing. The buyer does not have to spend a penny. Contingencies have not started in a short sale until written approval is obtained from the lender/lenders involved. Everything can be found out (and usually is found out) weeks and even months before the approval is completed.[/quote]

This is entirely the point of this thread and my point as well. Many sellers and their agents today are taking escrow “too lightly,” often due to recalcitrant lenders whom they are “hopeful” will take voluntary “haircuts” at some point in the near future.

10+ years ago, when each purchase offer packet of CAR forms (legal size, in NCR quadruplicate) was $7.50, as agents, we didn’t waste time and money making a bunch of “random offers” at once to see if they stick and then tell our clients to keep looking while they are presumably “in escrow.” Being “in escrow” meant you were in contract to purchase property. The “shopping” was over. Your earnest money check was deposited. Sellers/buyers had a duty to perform.

I know that CAR forms, including the purchase offer, counter offer and the Exclusive Authorization and Right to Sell packet are in software pkgs now, because I am a subscriber. I know an agent can just type in the blanks and submit offers randomly, at no cost. I know they can now transmit these offers electronically. I know that original signatures are no longer needed right away. I know agents don’t have to visit mail drops around town at 10:00 pm to submit offers anymore. I am aware that current buyers don’t post an earnest $$ money deposit on short sales (and then listing agents complain they walk too much, lol). What do they expect?? Are all these machinations a “streamlined” way to do business today or does it invite “breach” and “walking?” Does the current “system” work, SDR??

[quote=SD Realtor]Your assertions that buyers are putting out money because they cannot find out this information are false. You are telling a lie. Your other allegations about short sales falling through because of your litany of judgements and other reasons… well I will ask you AGAIN…you said you were going to talk to realtors and find out about how many transactions this occurred in? Well? I am still waiting.[/quote]

I’m still working on this and will post what I learn here on this thread.

[quote=SDRealtor]I am not taking anything personally. I am one of a few people who can call you out on this. The bottom line is you know deep down that buyers can find out all of this information and instead of saying, “yes buyers can find out about this” you would rather do anything you can to not say that.[/quote]

Yes, a buyer can find out about liens prior to making an offer IF the seller’s name is not too common, IF they have proper middle initials and IF they have other personal info about the seller at their disposal to assist them (esp if the seller has a common name) and IF they or their agent know how to properly search the title at the recorder’s office or thru a subscription service. Many buyers and agents don’t. This “talent” (and it is a talent, btw), is not required to be an agent or even a broker in CA. That is why we have title companies. If buyers knew of the liens in advance they could structure their offers as to those liens and demand that they be cured/removed as a condition of sale. This IS easier to do for a buyer now that the last 29 years of ARCC records are available online. This didn’t used to be the case. Microfilm and cloth binders, anyone?? Got an extra week to “train?” If so, break out the running shoes.

However, here in SD County, ARCC doesn’t tell the WHOLE story about a delinquent seller. Sellers who are behind in their mtg payments quite often have other problems with debt. They (and non-property owners) are often sued and never respond. Unbeknownst to these seller-defendants, these collectors get default judgments against them, sometimes to the tune of several per day per courthouse. When defendant-debtors are mailed the entry of judgment by the clerk, they often don’t know what it is so they bring it to someone like me and ask. They often have no $$ to pay them, anyway. These creditors have to wait to get their judgment entered. Then they have to wait a longer period to get an abstract issued. While they are waiting, they are often trying to work out a payment plan with the judgment debtor, sometimes discounting the debt. All of this may be going on in the “back room” simultaneous to these sellers’ short-sale escrow with bona-fide buyers. These debts would NOT show up on a PR as “encumbrances to real property” but could scotch a deal at the 11th hour if the seller is uncooperative with their judgment creditors and/or the short-sale escrow drags on long enough. When a judgment creditor becomes pissed and/or loses contact with the judgment debtor, they file their already-issued abstract with no further ado, as is their right. They may or may not know that the debtor’s property is in escrow, they may not care and it doesn’t matter. This “deadbeat” seller may not understand that this judgment creditor has the power to shut their escrow down. They may not have even told their listing agent about the debt.

In light of the current market, I feel today’s buyer’s motto should be, “When a seller can no longer make their payments and want a buyer to `rescue’ them from foreclosure via a `short sale,’ DIG DEEPER.”

It COULD be a “race against time” with some of these “short sale” sellers to close before more “creditors” enter the mix.

SDR, as a buyer, would YOU want to enter a “short-sale” transaction without knowing everything possible about the seller relative to the current or future marketability of their title?? I certainly wouldn’t.

[bearishgurl]

[quote=urbanrealtor]Okay.
That’s it.
I have had enough.

1: Preliminary title reports (PR’s) are easy to get.

You totally don’t have to have an active transaction for a PR. I get them all the time for my short sale listings before I have a buyer.

2: A PR is not an authoritative statement of encumbrance.

A PR will generally show trust deeds and liens but not demands. Since you never know how much a place is encumbered without a demand, the PR is not much better than just the public records (or Realist). Generally a demand is lower than the full value (in my experience) showing on the PR. Further, if there were other non-liened obligations (eg: a year of back HOA dues) they might not even show up on a PR. Fail.

3: Banks can add stuff in that is not known to anyone.

I just closed a buyer’s purchase in Murrieta. The seller had $50k of equity. They had lost some of their income and could not keep up. Wells put them through no less than 5 different modifcation programs (all the while telling them not to pay). Eventually, the sellers got frustrated and gave up. When they sold to my clients, the bank added in over $40k in fees for non-payment (non-payment which was done at the bank’s direction). Those fees were in excess of liened amounts and did not show on any PR or public record. It meant the sellers walked with $5k instead of $50k.

4: The duty does not change.

The agent’s duty is still to show all the warts of which he is aware. Even if he was banging both the buyer and seller simultaneously, he still failed utterly to disclose a known material fact. Specifically, he concealed major negative equity to a client.[/quote]

Good post, UR. Agree wholeheartedly with what you are saying here. I’ve been trying to say same. You must have an “account” with a title company for discounted PR’s. You are giving your “short-sale” buyers excellent service!

FWIW, I have run across mtg statements from stated-income (neg am) loans taken out in 2006-2007 where the borrower owes MORE today than the amt shown on the face of their filed trust deed. And the borrower was NOT behind in their payments.

UR, would you say the Holmes ruling is a step in the right direction for consumers of real estate?

[bearishgurl]

[quote=urbanrealtor]Okay.
That’s it.
I have had enough.

1: Preliminary title reports (PR’s) are easy to get.

You totally don’t have to have an active transaction for a PR. I get them all the time for my short sale listings before I have a buyer.

2: A PR is not an authoritative statement of encumbrance.

A PR will generally show trust deeds and liens but not demands. Since you never know how much a place is encumbered without a demand, the PR is not much better than just the public records (or Realist). Generally a demand is lower than the full value (in my experience) showing on the PR. Further, if there were other non-liened obligations (eg: a year of back HOA dues) they might not even show up on a PR. Fail.

3: Banks can add stuff in that is not known to anyone.

I just closed a buyer’s purchase in Murrieta. The seller had $50k of equity. They had lost some of their income and could not keep up. Wells put them through no less than 5 different modifcation programs (all the while telling them not to pay). Eventually, the sellers got frustrated and gave up. When they sold to my clients, the bank added in over $40k in fees for non-payment (non-payment which was done at the bank’s direction). Those fees were in excess of liened amounts and did not show on any PR or public record. It meant the sellers walked with $5k instead of $50k.

4: The duty does not change.

The agent’s duty is still to show all the warts of which he is aware. Even if he was banging both the buyer and seller simultaneously, he still failed utterly to disclose a known material fact. Specifically, he concealed major negative equity to a client.[/quote]

Good post, UR. Agree wholeheartedly with what you are saying here. I’ve been trying to say same. You must have an “account” with a title company for discounted PR’s. You are giving your “short-sale” buyers excellent service!

FWIW, I have run across mtg statements from stated-income (neg am) loans taken out in 2006-2007 where the borrower owes MORE today than the amt shown on the face of their filed trust deed. And the borrower was NOT behind in their payments.

UR, would you say the Holmes ruling is a step in the right direction for consumers of real estate?

[bearishgurl]

[quote=urbanrealtor]Okay.
That’s it.
I have had enough.

1: Preliminary title reports (PR’s) are easy to get.

You totally don’t have to have an active transaction for a PR. I get them all the time for my short sale listings before I have a buyer.

2: A PR is not an authoritative statement of encumbrance.

A PR will generally show trust deeds and liens but not demands. Since you never know how much a place is encumbered without a demand, the PR is not much better than just the public records (or Realist). Generally a demand is lower than the full value (in my experience) showing on the PR. Further, if there were other non-liened obligations (eg: a year of back HOA dues) they might not even show up on a PR. Fail.

3: Banks can add stuff in that is not known to anyone.

I just closed a buyer’s purchase in Murrieta. The seller had $50k of equity. They had lost some of their income and could not keep up. Wells put them through no less than 5 different modifcation programs (all the while telling them not to pay). Eventually, the sellers got frustrated and gave up. When they sold to my clients, the bank added in over $40k in fees for non-payment (non-payment which was done at the bank’s direction). Those fees were in excess of liened amounts and did not show on any PR or public record. It meant the sellers walked with $5k instead of $50k.

4: The duty does not change.

The agent’s duty is still to show all the warts of which he is aware. Even if he was banging both the buyer and seller simultaneously, he still failed utterly to disclose a known material fact. Specifically, he concealed major negative equity to a client.[/quote]

Good post, UR. Agree wholeheartedly with what you are saying here. I’ve been trying to say same. You must have an “account” with a title company for discounted PR’s. You are giving your “short-sale” buyers excellent service!

FWIW, I have run across mtg statements from stated-income (neg am) loans taken out in 2006-2007 where the borrower owes MORE today than the amt shown on the face of their filed trust deed. And the borrower was NOT behind in their payments.

UR, would you say the Holmes ruling is a step in the right direction for consumers of real estate?

[bearishgurl]

[quote=urbanrealtor]Okay.
That’s it.
I have had enough.

1: Preliminary title reports (PR’s) are easy to get.

You totally don’t have to have an active transaction for a PR. I get them all the time for my short sale listings before I have a buyer.

2: A PR is not an authoritative statement of encumbrance.

A PR will generally show trust deeds and liens but not demands. Since you never know how much a place is encumbered without a demand, the PR is not much better than just the public records (or Realist). Generally a demand is lower than the full value (in my experience) showing on the PR. Further, if there were other non-liened obligations (eg: a year of back HOA dues) they might not even show up on a PR. Fail.

3: Banks can add stuff in that is not known to anyone.

I just closed a buyer’s purchase in Murrieta. The seller had $50k of equity. They had lost some of their income and could not keep up. Wells put them through no less than 5 different modifcation programs (all the while telling them not to pay). Eventually, the sellers got frustrated and gave up. When they sold to my clients, the bank added in over $40k in fees for non-payment (non-payment which was done at the bank’s direction). Those fees were in excess of liened amounts and did not show on any PR or public record. It meant the sellers walked with $5k instead of $50k.

4: The duty does not change.

The agent’s duty is still to show all the warts of which he is aware. Even if he was banging both the buyer and seller simultaneously, he still failed utterly to disclose a known material fact. Specifically, he concealed major negative equity to a client.[/quote]

Good post, UR. Agree wholeheartedly with what you are saying here. I’ve been trying to say same. You must have an “account” with a title company for discounted PR’s. You are giving your “short-sale” buyers excellent service!

FWIW, I have run across mtg statements from stated-income (neg am) loans taken out in 2006-2007 where the borrower owes MORE today than the amt shown on the face of their filed trust deed. And the borrower was NOT behind in their payments.

UR, would you say the Holmes ruling is a step in the right direction for consumers of real estate?

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