[Steve Beebo]

“Stonewood’s attorney acknowledged that many of the clients paid more for the houses than buyers of surrounding properties, but said the prices —- and the resulting mortgages —- were supported by third-party appraisals, including several arranged by the lending institutions.”

This is a lie. The appraisals had to have been fraudulent. The appraisals were ordered by Stonewoods’ mortgage broker. I would love to see some of the appraisals.

I have seen and done some research on some of the properties, and have seen a list of hundreds of the properties in question, and most were sold at prices around $100,000 above fair market value, and in many cases, $100,000 above their active list prices. No lender would loan on a purchase of a property that is $100,000 over list price in a stable to declining market. The appraisals had to have been fraudulently prepared.

[Steve Beebo]

It’s not too surprising that California is #1, since about half of all million dollar homes in the country are located in this state.

[Steve Beebo]

The commute from Escondido to San Diego is not easy right now at rush hour, but in a year or two, it will be much better.

Currently there are two reversible car pool lanes from Highway 56 to 163 in Miramar, but there are going to be four car pool lanes from Escondido to 56 by the end of the year, and Caltrans is going to make it four lanes from 56 to 163 also. There will be 3 lanes going south in the AM, and one lane going north, and for the afternoon rush hour, the lanes will be reversed.

Single riders will be able to purchase Fastrak so they can get in the car pool lanes also. When the four additional lanes are completed from Escondido to 163, the commute should be very easy.

[Steve Beebo]

When Al gets up to 300 pounds, (probably by around next weekend), he’ll tell us that we eat too much, too.

BIG, BIG phoney.

[Steve Beebo]

I have seen a list of several hundred properties involved in the case. There are a couple of loans in SD County, a couple in Orange County, and a couple in Arizona, but 98% of the properties in this list are in Murrieta, Temecula, or areas very nearby, like Wildomar and Lake Elsinore.

[Steve Beebo]

This property sold new from Davidson 7-04 for $999,500.

The owners re-fi’d in May 2005, with a first mortgage of $1,169,000 and a 2nd of $331,000 – the total loan balance was around $1,500,000. So the lender (Countrywide), must have had an appraisal for at least that much.

The transfer 12-06 was indeed a foreclosure, and the house was just listed for sale at $1,349,000.

[Steve Beebo]

Why would anyone want to live in Dallas, Arlington, or San Antonio when they could live in beautiful El Paso?

[Steve Beebo]

ranjan –

A realtor, appraiser, or someone else with MLS access can pull up the property profile / tax record for any property, (listed or not), and can tell you the amount and dates of all loans taken out on the property. It won’t show the type or terms of the loan, though.

[Steve Beebo]

Update on story:

http://www.nctimes.com/articles/2007/02/10/news/californian/22_50_212_9_07.txt

[Steve Beebo]

The North County Times is supposed to have an article about the scam either tomorrow or Sunday. I don’t think the number of homes is anything close to 5000, but the resulting foreclosures in Murrieta and Temecula are going to do more damage to the already weak market in that area.

[Steve Beebo]

$1.2 Billion lawsuit filed:

http://www.emediawire.com/releases/2007/1/emw497285.htm

[Steve Beebo]

FormerOwner –

Do you know for sure that there were 2400 houses involved? Has that figure ever been in print? If not, I have a hard time believing that 2400 houses were involved. I have seen the figure of 400+ investors in the news. Are a husband and wife couple counted as two investors?

I don’t think the Temecula / Murrietta population is much more than 200,000. Even if there are 1000 short sales and/or future REOs created out of this scam, the negative effect on the market in that area would be devastating. The market already blows up there. Every street I drive down in that area seems to have a lot of active listings.

[Steve Beebo]

“What is a fair value for a four plex that is producing $6,500 per month in rent?”

Nobody can give you an intelligent answer without knowing where the property is located.

A gross rent multiplier may not be the best way to value a 4-plex, but if you do use it, you’ll have to know what the GRM is for similar properties listed and sold in that particular neighborhood. A fair GRM in La Jolla may be double a fair GRM in North Park.

[Steve Beebo]

I don’t know who the buyers are in general, but there are nearly 4000 SFRs and condos in escrow in SD County right now. I would say that there are very few investors in the market, though.

I will say that people buying now in San Diego, especially first-time buyers, are in a better position than those that bought 12 months ago. Although prices will almost certainly continue downward, at least to some extent, buyers today are paying up to 5-10% less than they would have last year, depending on the area, and whether they’re buying SFRs or condos. So at least they’ve got that going for them.

[Steve Beebo]

 

According to this article in the Press-Enterprise,

 

http://www.pe.com/localnews/inland/stories/PE_News_Local_D_suit06.379821a.html

 

there are several hundred loans affected.  I think the attorney or the reporter misplaced a decimal point when they quoted the figure of $1.2 Billion.  Still, even a few hundred more possible REOs could do a lot more damage to the already weak market in that area.

[Author]

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