NYT: “How a financial pro lost his house”

[bearishgurl]

[quote=Jacarandoso]Thanks BG, it is going out in the next mail drop.[/quote]

Rus, I erred in that what you will actually be appealing by 11/30/11 is the F/Y 12/13 assessment. This bill will be mailed the 3rd week of September 2012.

You must pay your F/Y 11/12 tax bill as the appeal period ran out for that one on 11/30/10.

[bearishgurl]

[quote=AN]It always amazes me how judgmental and vile some people can be, especially when they don’t have all the details. All I can say is “Let he who is without sin cast the first stone”.[/quote]

AN, the writer here listed all his details and even wrote a book he’s pandering online which lays out his problems in even more lurid detail!

I “have a problem” with strategic defaulters who took cash out and then expect to be able to have their debts “forgiven” thru a “short sale.”

I don’t feel a 150 pt? reduction in FICO score is enough penalty for withdrawing equity and then having it “discharged” without even having to file a Chapter 7 BK (350 pt+ reduction).

I feel persons who withdrew equity and now wish to rid themselves of the debt from that withdrawn equity should have no choice but foreclosure (300 pt reduction).

If the Richards’ credit can now “recover” in 2-3 years enough to purchase another property, that means the $200K they already withdrew (and probably spent) seems like a very small price to pay for being able to buy RE again in 2013. We can look at it as $66,666 per year as “compensation” for their 3-year waiting period and $100K annual compensation for a 2-year waiting period.

What about those who extracted $500K from their properties and now wish to short their HELOC/2nd TD holders at an effective 94% “discount?”

Nice gig if you can get it. But where does it end? With a publisher actually giving this individual a platform, it could encourage many more people who can afford their mortgages to default so they can render themselves eligible to “sell short.” And while they’re still working and/or bringing in income (no “hardships” in this group) they’re living “mortgage free” while their lender(s) sit on their hands and allow them to.

I guess the last sentence (above) most aptly describes the crux of the problem….:={

[NotCranky]

[quote=bearishgurl][quote=Jacarandoso]Thanks BG, it is going out in the next mail drop.[/quote]

Rus, I erred in that what you will actually be appealing by 11/30/11 is the F/Y 12/13 assessment. This bill will be mailed the 3rd week of September 2012.

You must pay your F/Y 11/12 tax bill as the appeal period ran out for that one on 11/30/10.[/quote]

No problem, BG. Thanks for taking the time to post. Either way I’ll get the application in. I already paid the first installment on the 2011/2012. NDFA, right?

The “Application for Changed Assessment” indicates that I am Appealing the value as of January 1 of the current year. That means 2012/2013 tax year? Because of filing period arrangements?

The application has a section that asks.
“Do you want to designate this application as a claim for refund?” does that apply to 2011-2012 which I am paying as billed, or to the 12/13 period, yet unpaid. Should I check this box?(doesn’t sound like it could hurt).I know this is a redundant question to the one in the paragraph above. It just doesn’t make sense to ask for a refund on what won’t be paid until this time next year?

What do you know about the ” written finding of facts”, should we ask for that?(It sounds like something one would want)

When you said “hg” in earlier posts, you meant the actual hearing? So the home owner can submit the application and the appeals board has the option of lowering the assessment without a hearing. They did that for you at one point, so you withdrew your application for that period? How often do the do it. Can I just call and ask them to do it, or is an application the only way to get the question on the table?

It’s o.k if you don’t want to answer any of that. I can go look for the instructions, and will. The stuff doesn’t make sense to me without further discussion. It seems like the counter people are trained to not make it more understandable. It’s something for which other people’s recent experience can be very helpful.

I agree that you are not offering tax advice with any input to my questions :).

[an]

[quote=flu][quote=AN]It always amazes me how judgmental and vile some people can be, especially when they don’t have all the details. All I can say is “Let he who is without sin cast the first stone”.[/quote]

I don’t have an issue with him personally. My beef is with this financial planning/advisor “business”. I guess most of us here probably can tell when so a titled “financial advisor” can’t manage finances, let alone advise, and wouldn’t be put into a mess

… But have you considered that a majority of people in this country, who have very little financial competency, depend on so called financial “advisors”, who likewise most likely have very little financial competency too? It’s pretty sad imho.

Perhaps it’s harsh thing to say. But I’m a firm believer that you definitely don’t want to “advise” or “teach” something that you can’t do yourself. AN, I think it would be like one of us releasing a piece of software to production or to a customer that won’t work because you didn’t know what you were doing…[/quote]
flu, I don’t disagree with you. Which is why I’m managing my own money. A lot of them are salesmen at best. It is sad that people depend on others to manage their money. However, I know I’m not perfect, so I won’t go and attack people personally by calling them names and making judgment without knowing the whole story and all of its details. Some people can’t get off their high horse and are too quickly to resort to personal attacks.

[an]

[quote=walterwhite]The Bible doesn’t say anything about second and subsequent stones being thrown, even assuming ghe first stone was wrongfully thrown. Let he who is without sin throw the first stone, and, if the first stone is thrown contrary to this rule, let no subsequent stones be thrown.

Not sure if that covers it.[/quote]
No it doesn’t, but then you can’t have a 2nd stone if you don’t have a 1st. Karma will get you sooner or later for casting stones at others.

[an]

BG, again, “Let he who is without sin cast the first stone”. Sure you can “have a problem” with these type of situation. Everyone is entitled to their own opinion. I have a problem with a lot of things, but I don’t go around and make personal attacks on people, especially when that person is not around to defend themselves. Also, you only know the details he revealed. Is that all the details? I don’t know, do you?

[bearishgurl]

[quote=AN]BG, again, “Let he who is without sin cast the first stone”. Sure you can “have a problem” with these type of situation. Everyone is entitled to their own opinion. I have a problem with a lot of things, but I don’t go around and make personal attacks on people, especially when that person is not around to defend themselves. Also, you only know the details he revealed. Is that all the details? I don’t know, do you?[/quote]

FWIW, AN, I never called Richards names or attacked him. I attacked his ability to be eligible to “sell short” after taking nearly $200K “cash out” and then deliberately squatting because it was convenient for him. Obviously he and his family lived off of and took vacations on that $200K. Who’s paying for this?? I attacked his claiming he “had to move” when he really didn’t have to. His claiming he “had to be closer to his clients” was BS. That was the story he told to his lender so they would accept his short-sale offer. He’d been servicing those same clients for all the years he lived in NV! He deliberately moved AWAY from them because he stated that he and his spouse “wanted a different experience.”

When someone writes an article for a major media outlet and then publishes a book (esp an autobiography or personal experience), they put themselves out there to be “critiqued.” If you think I’m judging him too harshly, why don’t you read the 559 comments posted on the NYT website in reference to his article?

Richards is a published “writer” now, lol. In this biz, if you can’t take the heat, get out of the kitchen!

[an]

BG, if you never called him names, good for you. I don’t like ANY short sale. I believe people should either foreclose or stick with the contract. I don’t like loan mod either. But I try to not get on my high horse. It’s your prerogative to judge him however you see fit. I was just saying it amazes me how vile people can be. Another saying I try to live by is, “if you don’t have anything nice to say, don’t say anything at all”. Sometimes I fail to live up to it, but I do try. I also believe in karma and “what goes around, comes around”.

[bearishgurl]

Rus, check your pms tonight or tomorrow.

[sdrealtor]

[quote=bearishgurl][quote=sdrealtor]Sure I’ll answer. I went back to grad school in the 90’s so thats where the student loans came from. There wasnt much and I could have paid them off but the rates on home equity loans were too attractive to do so….[/quote]

Understand.

I know we’re in the middle of a “recession” and all but, I just have to ask, “Why are you working as a PT “Realtor” when you have a “graduate degree.”

Are there no jobs avail in your field? You can tell me to MYOB but I was just wondering …[/quote]

Just saw this post. Actually I have two masters degrees. I worked in my field, helped build a company and sold it for a nice profit. Working in real estate was a lifestyle choice I made because I afford to do so. I love where I live and got tired of traveling for work. I made that decision pre 9/11 and couldnt image how tough it must be now. I wanted to see and be a part of everything my kids did when they still cared enough to hang out with dad. It has been one of the best decisions of my life and one I’ll never regret regardless fo what it cost me financially.

BTW, going back and looking at your numbers a few things are clear. You never refi’d so you must have a straight adjustable loan as you never would have held on otherwise. So you took on alot of risk when you made that decision. The payment is probably lower today and your taxes are as well so your payment when you bought had to be well above the cost of rent. Reading your post the only real reason you gave for buying was you had pets. Really? Did you buy a house for your dog? You criticize this guys wife for not working and you put your family at risk for a dog? Please tell me its not so????

[bearishgurl]

[quote=sdrealtor] . . . You never refi’d so you must have a straight adjustable loan as you never would have held on otherwise. So you took on alot of risk when you made that decision. The payment is probably lower today and your taxes are as well so your payment when you bought had to be well above the cost of rent. Reading your post the only real reason you gave for buying was you had pets. Really? Did you buy a house for your dog? You criticize this guys wife for not working and you put your family at risk for a dog? Please tell me its not so????[/quote]

sdr, let me ask you, when YOU bought your principal residence (pre-9/11?) did you consider it to be a “risky investment?” I don’t recall many multiple-bid situations or people lining up to get into an open houses back then, do you? Did you know pre-911 that the RE market was going to come tumbling down in 2007?

Since you have been a homeowner all this time, would you now sell and RENT here in SD County if you had kids/pets living with you? I had been a homeowner all of my life. Why would I want to rent? Renting wasn’t cheaper. Do you know what a pet deposit is for 3 pets? Do you know any landlords who will accept all three of them? My adj rate mortgage started out at $1100 and has been as high as $1500 over the years and is now $1200. At all times it was cheaper than rent, bigger than a rental and has a lg backyard. I didn’t feel that I took an undue risk and still don’t. I’ve had this type of mtg since the ’80’s and have had very good experiences with it.

It’s too bad that so many ignorant people took out Option ARMS in recent years who never should have borrowed in the first place. This gave them an (undeserved) bad rap. They are excellent mortgages and I would get one again, if I could. However, there is likely zero chance I will be able to get the deals I obtained in the past as they are no longer “floating” with their respective indexes and the margins are now higher (likely due to prolonged low interest rates). They now have +/- (7.5% ?) annual backstops built into them after the 60th month (to avoid payment shocks?) but they threw out the baby with the bathwater in doing that. That’s what annual caps are for. The borrower must accept the bad with the good.

I must admit I’ve enjoyed the best interest rate climate in my life to be holding this sweet mtg!

The “professional financial planner” here and his spouse were obviously poor money managers in their personal lives. He stated SHE found the house and liked it so they bought it. He also stated HE wanted to spend $350K on a house. He wouldn’t be the first spouse to agree to overspend on a home to please his spouse. They BOTH knew they were going down when they were dipping into their cc’s and HELOC? just to exist month to month. She knew they would lose health coverage when he decided to work for himself.

Many, many families who live in LV work various shifts so that they have minimal or zero child care expense.

As I previously posted, they could have easily kept that house if they just had a little more income and didn’t extract so much cash out of it (which they partly used to live b/c SHE wasn’t bringing in income). Their lifestyles went up (vacations, etc) when they began extracting equity.

As you can see from the photos, this couple came back to the house just last month to gaze at it from the street and be photographed in front of it. Obviously, they miss it but they did it to themselves.

The days of the ’50’s “Stepford wives” are long gone. As a parent (male or female), I believe you have a moral and legal obligation to do what it takes to financially support your kids. She was falling down in this category when his biz started to falter. She stood idly by while he was struggling to pay I/O (or even less) on their “pick-a-pay” ARM (which had probably reached the 125% threshold). I guess we won’t know WHY, with his supposed, “credentials,” he signed up for this disastrous mtg (for them) unless we shell out $24.95 to read his book.

I won’t buy it because I don’t want to help the Richards pay for their annual two-week winter vacations in Beaver Creek that they’ve gotten “accustomed to” now. I’d rather just save my pennies and send myself :=]

[sdrealtor]

I bought new construction and thought is was risk free. I identified the community when it was being built as a sure thing to end up the most desireable neighborhood in my neck of the woods and its exceeded my expectations. We put 20% down and the mortgage was less than 2 times HH income. If I had to liquidate investments I could have paid cash. I didnt expect the market to skyrocket but expected steady appreciation for the market and well above the market average for my community. Again both have exceeded my expectations. I dont take the kind of chances you did.

So you did essentially buy a house for your dogs. LOL. I got a secret for you. You dont have to have dogs. You made a choice based upon the pets that could easily have blown up in your face even worse than it has. You say the loan you have is great and you would do it again but you got lucky. If interest rates were where they should be you probably would be sitting on a mortgage you couldnt afford right now. Its easy to cast stones at others decisions but dissected yours could be also.

BTW stop saying you P&I is less than rent. There are other costs you are conveniently ignoring again and again. You pay taxes, insurance and maintenance that renters dont.

[bearishgurl]

[quote=sdrealtor]I bought new construction and thought is was risk free. I identified the community when it was being built as a sure thing to end up the most desireable neighborhood in my neck of the woods and its exceeded my expectations. We put 20% down and the mortgage was less than 2 times HH income. If I had to liquidate investments I could have paid cash. I didnt expect the market to skyrocket but expected steady appreciation for the market and well above the market average for my community. Again both have exceeded my expectations. I dont take the kind of chances you did.

So you did essentially buy a house for your dogs. LOL. I got a secret for you. You dont have to have dogs. You made a choice based upon the pets that could easily have blown up in your face even worse than it has. You say the loan you have is great and you would do it again but you got lucky. If interest rates were where they should be you probably would be sitting on a mortgage you couldnt afford right now. Its easy to cast stones at others decisions but dissected yours could be also.

BTW stop saying you P&I is less than rent. There are other costs you are conveniently ignoring again and again. You pay taxes, insurance and maintenance that renters dont.[/quote]

Lol, there is no way you could have known how a new construction tract would turn out. IMO, you took a HUGE risk in buying in an unproven, unseasoned CFD/HOA-encumbered area without nearby sales comps to support your purchase price!

For the record, my FICO score is now 851. It’s hovered between 804 and 851 since the nineties.

I don’t have more than one dog. I essentially bought the home for my kids. Hey, I thought I read somewhere that you had a dog – can’t remember…

My PITI is currently just under $1500.

I have plenty of equity and probably enough income to refinance to a low 15 or 30 yr rate. At all times since I owned I could have easily refinanced but chose not to because I don’t want to pay closing costs or wrap them into the loan. It is beginning to amortize quickly now and I want to sell it in a few years, anyway, and keep the assumable feature with the low assumption fee intact. How many Piggs have this as a selling point??

Let me ask you…would you refinance to a 4% fixed rate if you were currently paying a 4% adj rate and had been for many months? Isn’t your HELOC adjustable? (I’ve never met one that was fixed, lol.) Why would you take a risk like that with your children’s home?

Aren’t you an “expert?” Do you see mtg interest rates climbing thru the roof in the next 3 years??

You state “we” bought the home and that you qualified for it with two incomes. Does this mean you are only 50% owner??

[briansd1]

[quote=AN]BG, if you never called him names, good for you. I don’t like ANY short sale. I believe people should either foreclose or stick with the contract. I don’t like loan mod either. But I try to not get on my high horse. It’s your prerogative to judge him however you see fit. I was just saying it amazes me how vile people can be. Another saying I try to live by is, “if you don’t have anything nice to say, don’t say anything at all”. Sometimes I fail to live up to it, but I do try. I also believe in karma and “what goes around, comes around”.[/quote]

Are you getting soft, AN?

Some people think we should bring back debtors’ jail.

Or should we not have some kind of financial 3-strike-and-you’re-out type rule?

I do agree with BG, that if someone publishes and makes himself public with the idea to benefit or profit from the exposure, he becomes public domain and opens himself up to scrutiny and criticism. BTW, the criticism he engenders might bring him more notoriety, sell even more books and benefit him more.

[sdrealtor]

I knew exactly how the new construction tract would turn out. The area was booming and about to take giant leap forward in desireability which it has. There had been little to no new construction in this range in my area in almost 2 decades. There was huge pent up demand for newer homes between 2000 and 3000 sq ft which was obvious to me. When I bought the price of a 20 yr old resale less a mile away in dire need of updating was selling for the about same price. those homes were smaller and bordering on functional obselescence. Those sales comps more than justified our price. We got the nicest recreational amenities in Coastal North County for about the same HOA fees that the older neighhborhoods paid for minimal facilities. We had a brand new elementary school being built in a neighborhood that was sure to be a magnet for young professional families. That school now ranks among the top 10 in the county.

As for the asumable feature it doesnt seem to be worth much anymore. The buyer still has to qualify to assume it. Why would a buyer want an adjustable loan when they can get a fixed loan for the same rate and minimize risk. Assuming yours they would have to have a big down if you have equity and/or take out a 2nd loan at a higher rate also. It doesnt make sense unless rates skyrocket which i dont think they will.

I keep my HELOC because I earn a higher return on the assets I have to pay it off. If that changed I would liquidate those assets and pay it off. Sorry, no risk there at all.

If you are certain you are moving in a few years why not go for 5/1 or 3/1 arm with rates in the low 2% range? You could make additional princincipal payments with the savings and pay your balance down even faster. I think I know why. You have stated many times you cant qualify to refinance because you cant document income. Why are you singing another tune now?

[Author]

Posts