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May 21, 2007 at 9:15 AM in reply to: Question for sdr, jim, rustico, bugs or other realtors and appraisers #54081
NotCranky
ParticipantAlex,regardless of the loan you get you are not going to have much equity to draw on for a long time. This is true for two reasons, First you barely make a dent in your principal at all in the first several years of a mortgage. Second unless you find that one in a million house that is actually appreciating right now you will be upside down on the house faster than the ink dries on the loan documents. If you buy and you probably should not, I would suggest going with the loan that affects your cash flow the least that also does not leave you at risk of unpredictable trends in mortgage rates going forward. If you already have 10% down and the market keeps falling on the house you want, every day you have a higher percentage down! Why don’t you keep saving? Maybe you will have 20% down sooner than you think!At that point you could chose to put 5%-10% down if you want and won’t have to rely on the questionalble possibility of appreciation for your emergency fund.
Best wishesParticipantAlex,regardless of the loan you get you are not going to have much equity to draw on for a long time. This is true for two reasons, First you barely make a dent in your principal at all in the first several years of a mortgage. Second unless you find that one in a million house that is actually appreciating right now you will be upside down on the house faster than the ink dries on the loan documents. If you buy and you probably should not, I would suggest going with the loan that affects your cash flow the least that also does not leave you at risk of unpredictable trends in mortgage rates going forward. If you already have 10% down and the market keeps falling on the house you want, every day you have a higher percentage down! Why don’t you keep saving? Maybe you will have 20% down sooner than you think!At that point you could chose to put 5%-10% down if you want and won’t have to rely on the questionalble possibility of appreciation for your emergency fund.
Best wishesParticipantVery good point gn. I wonder if the listing agent at least tried to get back-up offers? I also feel guilty of playing a game of armchair quarterback!
ParticipantVery good point gn. I wonder if the listing agent at least tried to get back-up offers? I also feel guilty of playing a game of armchair quarterback!
ParticipantSDR, I don’t agree that it is time to try to submit any threats or demands yet. As far as I understand the failure to perform is hypothetical still.
TONE: Escrows often get scary at the end but close anyway.
Just be glad that your buyer isn’t checking in to this blog!ParticipantSDR, I don’t agree that it is time to try to submit any threats or demands yet. As far as I understand the failure to perform is hypothetical still.
TONE: Escrows often get scary at the end but close anyway.
Just be glad that your buyer isn’t checking in to this blog!ParticipantI feel bad for you. Keep in mind you don’t have a very good pool of buyers, be assertive but carefully.If you want to get tough you could demand an increased deposit and actually anything reasonable that you want. If you don’t need to make too many demands It might be better just to chalk it up to experience and go on assuming that your deal is going to close.You should at the very least get it back on the market if the buyer is holding things up but then just continue to be nice and patient. Demanding occupancy after the sale could kill the deal if the buyer is as weak as the one SD Realtor is describing above.I don’t recommend calling the Mortgage people unless both agents seem completely incompetent and then you should go your agents broker and ask that person to work with the buyer’s agents broker.Your remedy after that and you absloutely don’t need to worry about it yet, is to go to the local Realtors Board. Best wishes.
ParticipantI feel bad for you. Keep in mind you don’t have a very good pool of buyers, be assertive but carefully.If you want to get tough you could demand an increased deposit and actually anything reasonable that you want. If you don’t need to make too many demands It might be better just to chalk it up to experience and go on assuming that your deal is going to close.You should at the very least get it back on the market if the buyer is holding things up but then just continue to be nice and patient. Demanding occupancy after the sale could kill the deal if the buyer is as weak as the one SD Realtor is describing above.I don’t recommend calling the Mortgage people unless both agents seem completely incompetent and then you should go your agents broker and ask that person to work with the buyer’s agents broker.Your remedy after that and you absloutely don’t need to worry about it yet, is to go to the local Realtors Board. Best wishes.
Participantjwm & Latesummer,
Your bearishness doesn’t bother me at all. I can find you a residential property that sold for 440k in 2005 that is now listed for 312k and I could probably have for 275k or less today. I don’t feel comfortable dragging MLS data over here. I think it will go to 200k a buyer or two from now. I think it is quite possible this scenario is going to become common place. I am trying to get at where you two think the bottom will be in terms that we piggingtonians can actually have a discussion about?
I think we actually had two bubbles, one caused by the strength of the economy in the second half of the 90’s and early 2000’s which drove the market until the funny money came in about 2002 and proceeded to get crazier. Thats why I tend to agree with you both about the macaroni really hitting the fan. Perhaps time has mitigated half or the first bubble and none of the second. I think we have 1 1/2 bubbles from peak or 2001-2002 prices at worst case scenario unless we are going into a depression, which I really don’t see as long as the US is the world’s superpower.That said I think a BIG WAR is a slim possibilty and all bets would be off for that too. That is about as scientific as I care to get. I am not really putting my pride on the line though with these predictions.I’ll start buying when it makes sense compared to other opportunities and I get a beter feel for the strength of the recession at hand.
Again what do you “super bears” think will stop the market from falling regardless of where that is?Participantjwm & Latesummer,
Your bearishness doesn’t bother me at all. I can find you a residential property that sold for 440k in 2005 that is now listed for 312k and I could probably have for 275k or less today. I don’t feel comfortable dragging MLS data over here. I think it will go to 200k a buyer or two from now. I think it is quite possible this scenario is going to become common place. I am trying to get at where you two think the bottom will be in terms that we piggingtonians can actually have a discussion about?
I think we actually had two bubbles, one caused by the strength of the economy in the second half of the 90’s and early 2000’s which drove the market until the funny money came in about 2002 and proceeded to get crazier. Thats why I tend to agree with you both about the macaroni really hitting the fan. Perhaps time has mitigated half or the first bubble and none of the second. I think we have 1 1/2 bubbles from peak or 2001-2002 prices at worst case scenario unless we are going into a depression, which I really don’t see as long as the US is the world’s superpower.That said I think a BIG WAR is a slim possibilty and all bets would be off for that too. That is about as scientific as I care to get. I am not really putting my pride on the line though with these predictions.I’ll start buying when it makes sense compared to other opportunities and I get a beter feel for the strength of the recession at hand.
Again what do you “super bears” think will stop the market from falling regardless of where that is?ParticipantTone if your buyer does not perform on time that is the chance to put new items into the contract or keep the earnest money. Lets hope everything goes well but if it doesn’t, think about demanding things that protect your interests better….like some period of occupancy for you after escrow closes and get the 72 hour clause put into effect if it isn’t already. After that you have your agent put the house fully back on the market for offers.
Good Luck.ParticipantTone if your buyer does not perform on time that is the chance to put new items into the contract or keep the earnest money. Lets hope everything goes well but if it doesn’t, think about demanding things that protect your interests better….like some period of occupancy for you after escrow closes and get the 72 hour clause put into effect if it isn’t already. After that you have your agent put the house fully back on the market for offers.
Good Luck.ParticipantSD R,
What do you suggest Tone do at the stage in the game that he/she is in? Something that a self respecting landlord would work with that gives the security Tone is looking for?
I like to see that the agent for the buyer in your case took proper responsibility for the error. It is amazing that a person who can’t pay a few weeks PITI and furniture rental for a house in lemon grove is getting a loan at all!
There is our proof that money isn’t that hard to come by still.I don’t envy your position.ParticipantSD R,
What do you suggest Tone do at the stage in the game that he/she is in? Something that a self respecting landlord would work with that gives the security Tone is looking for?
I like to see that the agent for the buyer in your case took proper responsibility for the error. It is amazing that a person who can’t pay a few weeks PITI and furniture rental for a house in lemon grove is getting a loan at all!
There is our proof that money isn’t that hard to come by still.I don’t envy your position. -
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