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SD Realtor
Participantocr I saw that. unreal man. I like the part about how all the other socal utilities saw what sdge did and now they are considering it as well.
ParticipantYes the buyer did get the home which was good. On the flip side the broker for the short sale negotiator was a slimeball.
ParticipantWhen we were doing our flips the most dicey thing was dealing with tenants who occupied properties that we purchased at auction. The laws that protect the tenants are pretty straightforward and are exactly as you stated.
You can correct me if I am wrong, but if I recall correctly, if the tenants have a copy of the previous lease, the new owners are indeed bound by that lease assuming it is a bona fide lease. There are several caviots defining that, primarly when the lease was generated in relation to the notice of trustee sale, as well as if the rent is market rate.
As you said, the general way to go about an eviction, (and if the lease is bona fide, and the tenants pay you the new landlord then you cannot evict until the lease term is up) is to go about it through the formal process as you explained above… Many newbee types in the flip game don’t understand the rules and try to bully tenants when in reality the tenants have alot of power if they know how to use it and can get a nice payout if they are positioned well by a pre-existing lease.
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I do have a great ethical story for you as well but it was not my transaction. Knew of a guy in a short sale. He had crappy representation. There were two loans… the second wanted 2500 from the buyer PRIOR to sending formal acceptance. Realtor didn’t know better and allowed him to do it however they waited until the last minute, sent the money in and the home went to foreclosure… that is not even the bad part…
The listing agent was using a third party short sale processor who worked for a broker. Another agent for THAT broker ended up buying the home at trustee sale. The original buyer who lost the 2500 ended up buying the home from the realtor who bought it at trustee sale for a little more then what they had it for during the short sale.
Unreal man…
ParticipantDoes this really surprise you? The only thing odd about it is the timing…. why now instead of not a year or two ago? hmmmmm
ParticipantThere have been many posts on this topic. I am sure someone will post links.
Many people who have had some real estate experience swear by this method. The primary reason is because they feel in a competitive situation with many other offers, this puts you in a better position because the listing agent will double end the deal and get both commissions. This could have some merit, it just depends on the integrity of the listing agent.
Other thoughts are that you as the buyer should go to the listing agent and tell them that you know they are going to double end the deal and that allows you to submit a lower offer. Alternately they can accept a lower commission (not the full double ended amount) along with your lower offer so the seller will accept the lower offer.
Again there is a possibility of this as well.
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So if you look at the two above possibilites as pros then the cons would be with regards to your representation. Will that agent be as hard nosed as a buyers agent that has worked with you only? Will they advise you accordingly with regards to inspections, concerns etc? If you ask yourself honest questions, the overwhelming probability of a lower degree of representation is high.
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So I would take it on a case by case basis. If the home you are looking at has several offers and it is a highly competitive situation, then yeah you could probably justify it, (make sure you have a third party who can be an advocate for you) but if that is not the situation I am not sure if I would do it. I would add that it also depends on your knowledge, and experience on real estate in general as well as the home/area you are buying in.
ParticipantAuctioned was postponed on 9/23/11. The listing agent was coy and would not tell me when the next scheduled date is but you can easily find out the next auction date using LPS or any other trustee sale calendars. Sounds like the bank is gonna take it back shortly unless they get a decent short sale offer. It is currently active on the MLS.
October 25, 2011 at 12:43 PM in reply to: Low Mortgage Interest Rates For Everyone!!!: U.S. May Back Refinance Plan for Mortgages #731295ParticipantOne other thing… it seems like if the real goal was to put more money into j6p pockets then why is this deal limited to only those who are underwater? Wouldn’t it make more sense to expand the refi opportunity to EVERYONE who owns a mortgage and who can show a good payment history of 6 months? To me that would pull a hell of alot more money into the wallets of everyday homeowners.
Of course they cannot do this because then the investors who own all that paper would see a loss of interest income.
October 25, 2011 at 7:08 AM in reply to: Low Mortgage Interest Rates For Everyone!!!: U.S. May Back Refinance Plan for Mortgages #731278ParticipantYes CAR origination charges will be lower because the hefty increases that were put in place by the GSEs are now going to be removed.
At least that is my understanding.
Like I said I am on the fence about the program. I understand the goal. Put more money in the pockets of people who have had a 6 month good payment history, (which is not much by the way) and hope that this money stimulates the economy.
Honestly I am not sure if that happens. I think an economy is stimulated with jobs. I think that people are trying to save money, not spend money that they save.
Again, I am trying to wrap my arms around a better solution that will actually help SOLVE the problem, not just push the problem down the road. In order to do that the asset HAS TO BE LIQUIDATED. So perhaps you actually liquidate the asset and let it go for sale. The current owners actually get first right of refusal of some sorts. That is, under an open bid, whatever that highest bid is, the owners get to match or top it. This would be a short sale of course. The only hitch is the equity problem. For this issue the owners may be granted some sort of leniency, perhaps due to their good payment history they only need to come up with 3% down or something like that. So what is the end result? Well the end result is that the bad loan comes off the books and is the new loan now reflects the current market value of the home. The owners who stayed got to keep the home and now have a lower payment. Alternately if they chose not to stay they then moved into a home and rented and now most likely have a lower payment and can live within their means.
In this manner the liquidation that needs to happen has happened. The “reward” for the original owners is that they got to stay in the home. Also they did not have to go through a default process so they are not affected credit wise. One may argue that they “lost” the equity but the equity was lost due to market depreciation anyways. The loser would be the investors because the loan did not get fully paid off however they did not wash out completely, they at least got back 50%, 60% or more on the loan.
To me a program like this is much more of a solution to the problem.
October 24, 2011 at 5:36 PM in reply to: Low Mortgage Interest Rates For Everyone!!!: U.S. May Back Refinance Plan for Mortgages #731248ParticipantConfusing the mortgage problem with an insolvency problem is incorrect Brian.
I am somewhat torn about this proposal. I do see merit in putting money in homeowners pockets by lowering the rate at which they are paying which essentially is what this proposal is doing for qualified homeowners who are underwater.
However this by no means is solving the problem. In fact it is more then likely perpetuating it. The solution is actually rolling back safegaurds that were put in place because of the bubble. Mortgage originators now can no longer be held responsible for an incorrect appraisal. In fact, I do not believe they will even be appraising properties that are going to be refinanced under this program. Thus a loan is being made on an asset that we know is much less valuable then the loan.
Doesnt that seem wrong to anybody?
Furthermore the GSEs are going to back the loans. Ultimately that is taxpayer money.
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What else is happening here? Well we are now going tens or hundreds of thousands of refinances, maybe even millions to people.
Guess who makes money on refinances? Those evil banks if I recall… Is that correct? CAR care to chime in?
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Finally, we are once more promoting a society of consumption and strapping people to debt. The debt has not shrunk, the overvalued asset is still highly overvalued, and the loans on the books although they are at a lower rate, in no way do they represent the value of the asset. So essentially instead of trying to encourage the society to live within their means we are doing the opposite.
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The problem is a solvency problem and until liquidation occurs, the problem will persist. In fact, the real solution would be to do the opposite which would be to let the foreclosures run their course, and perhaps not punish people for indeed walking away. If all that time and money we have put into bailouts, affordability programs, shams and backroom deals, and all the other things we don’t even know about, was rather put into a focus of figuring out how to perform an orderly liquidation then THAT is how you build a foundation of a strong real estate market. This would be a monumental task and perhaps it is impossible.
However swallowing the bitter pill involves liquidation.
Again I am not saying this proposal is entirely bad… It has some merit but in reality the underlying asset is overvalued and the banks will make a killing off of the refinances. That doesnt sit well with me.
ParticipantAgreed Paramount… The worst case (and probably most realistic) assumption that the poster should realize is that the lender will use BOTH homes (mortgages, property taxes and insurance) to calculate what the poster will be approved for.
As sdr said above, most mortgage brokers will promise the world but it is the underwriters who make the decisions so be prudent when seeking out advice on this.
ParticipantI would agree with sdr to talk to some home loan people. However my advice would be that you worst case it. That is, presume that the lender will treat your purchase as an investment property purchase no matter how much you tell them it is not going to be that way. If this is the case you will not get the same rate as an owner occupied rate. You can even go so far as to literally put your home on the market for sale and many lenders still will not take the bait.
With regards to your ratios that the lender will use for your approval process, it doesn’t really matter how much equity you have in the home, they will more then likely count both mortgage payments, insurance and property taxes in the calculation because you do not have a tenant in place. Again, this is my speculative answer and it is a worst case answer. As sdr said talk to some lenders or mortgage brokers and see what they say.
If you had some time, then moving out, renting a place and getting some tenants in your home with s a little bit of seasoning would help mitigate the situation.
ParticipantPoint well taken jst. Good post and something I did not consider due to my lack of reading history.
You are especially correct about the govt having more influence and the growth of all levels of govt and the taxes we pay to support all of them… (which may be needed due to population growth) Note this is an assumption by me and I could be wrong.
ParticipantI am sorry I thought you had posted something about being in favor of wealth redistribution so I apologize for being incorrect about that.
I guess that we can agree to disagree about the value of labor. I think that capital and technology and research also play a far greater role in the production of goods and services then labor does with regards to private enterprise. You did once again refer to the exploitation of employees in other nations when in reality those exploited people probably have it a hell of alot better then their native citizens who do not have the jobs that they have. Once again, you view them as exploited simply because they get paid much less and have a much lower standard of living then the American counterpart who does the exact same job.
If the output of the two laborers is the same then isn’t the value of the product the same as well?
So your answer is to force the jobs to be in America simply to support an artificially high lifestyle?
Doesnt that seem peculiar to you?
I think the answer that you and I and everyone else knows to be true is the one we don’t want to face which is we have an incredibly high standard of living which is really not possible to maintain in the era of globalization. You can have as many isolationist policies as you like but eventually it will catch up. It really is not sustainable. A car is a car, a computer is a computer, they do not become more valuable because you paid an American 20x more to work on the line then you paid the Malaysian.
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It seems to me that perhaps one single possibility is to end all lobbying. No union contributions, no private contributions, no individual competitions. I thing ending political careers is good as well. There is no reason that anyone needs to be in congress or the senate for 30 years. A one or two term limit on any office seems to make sense to me. Perhaps a limit on advertising and campaining as well… At least some limitation such that the guy with the most money cannot win an election by bombarding the public with appearances and/or advertising.
The govt doesnt serve the people, it stopped doing that long ago.
ParticipantCAR the problem that I have with theories of equal distribution at any level is that it is not natural.
If you look at natural life it is random and it is far from equal. Where creatures exist in the food chain is where they exist and in nature there could and will never be equality. Thus we see an adaptation of creatures to exist and they naturally mutate over millions of years to thrive in their niche rather then make all niches equal.
Theories of equality for all workers rubs me wrong because the ruling class still exists. There can never be a society where everyone is equal, where all living conditions are the same. It is simple impossible. So to me theories such as his are not just pollyanish (if there is such a word) but entirely rubbish.
Now if you are espousing creating societies that try to emulate nature then that is something I can embrace. Sadly though numbers (and this is where the pragmatic side of me takes over) indicate that it will be challenging if not impossible to do because of finite problems and the matter that we simply have to many people in the world.
Again, don’t know the answers… however I know in my heart a Marxist society is simply a smoothing out of the working class but that evil ruling class still exists. Don’t try to say for a minute that it doesnt. I believe shooting for improving what we have over embracing a nonexistent utopia is a better path. I just am struggling to figure out the improving what we have part. Being hypocritical and complaing about the evil corporate empire while thoroughly immersed in their products and way of life seems….. odd to me.
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