With Halloween out of the way, Thanksgiving and Christmas are right around the corner. Many people are experiencing difficult times with job loss and foreclosures still on the rise. Sometimes, I think that Real Estate Professionals see more hardship than other professions, especially here in Riverside County, and other areas that have a large amount of foreclosures.
I was inspired by this piece and wanted to pass it on. I will definitely be trying to be on the lookout for someone that needs me to be their angel:
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This was written by a Metro Denver Hospice Physician: I was driving home from a meeting this evening about 5, stuck in traffic on Colorado Blvd., and the car started to choke and splutter and die - I barely managed to coast into a gas station, glad only that I would not be blocking traffic and would have a somewhat warm spot to wait for the tow truck. It wouldn't even turn over.. Before I could make the call, I saw a woman walking out of the quickie mart building, and it looked like she slipped on some ice and fell into a gas pump, so I got out to see if she was okay When I got there, it looked more like she had been overcome by sobs than that she had fallen; she was a young woman who looked really haggard with dark circles under her eyes. She dropped something as I helped her up, and I picked it up to give it to her.. It was a nickel.
At that moment, everything came into focus for me: the crying woman, the ancient Suburban crammed full of stuff with 3 kids in the back (1 in a car seat) , and the gas pump reading $4.95.
I asked her if she was okay and if she needed help, and she just kept saying 'I don't want my kids to see me crying! ,' so we stood on the other side of the pump from her car. She said she was driving to California and that things were very hard for her right now. So I asked, 'And you were praying?' That made her back aw ay from me a little, but I assured her I was not a crazy person and said, 'He heard you, and He sent me.'
I took out my card and swiped it through the card reader on the pump so she could fill up her car completely, and while it was fueling, walked to the next door McDonald's and bought 2 big bags of food, some gift certificates for more, and a big cup of coffee. She gave the food to the kids in the car, who attacked it like wolves, and we stood by the pump eating fries and talking a little.
She told me her name, and that she lived in Kansas City Her boyfriend left 2 months ago and she had not been able to make ends meet. She knew she wouldn't have money to pay rent Jan. 1, and finally, in desperation, had called her parents, with whom she had not spok en in about 5 years. They lived in California and said she could come live with them and try to get on her feet there.
So she packed up everything she owned in the car. She told the kids they were going to California for Christmas, but not that they were going to live there. I gave her my gloves, a little hug and said a quick prayer with her for safety on the road. As I was walking over to my car, sh e said, 'So, are you like an angel or something?'
This definitely made me cry. I said, 'Sweetie, at this time of year angels are really busy, so sometimes God uses regular people.'
It was so incredible to be a part of someone else's mira cle. And of course, you guessed it, when I got in my car it started right away and got me home with no problem. I'll put it in the shop tomorrow to check, but I suspect the mechanic won't find anything wrong.
Sometimes the angels fly close enough to you that you can hear the flutter of their wings...
This is important information that should not be ignored. I am sure we will hear more about this in the future: Thanks Greg: Please post comments directly to Greg Cook:
In the movie classic Network, Howard Beal, played by Peter Finch in one of the iconic moments in movie history gives us the classic line: "I'm mad as hell and I'm not going to take this anymore!"
I'm wondering when we as Realtors and our clients as consumers are "not going to take this anymore!"
Those of you who believe that the banks/lenders who control the REO properties are going to negotiate fairly and protect your client's interest, can probably stop reading here.
If you think, your job is to protect your client's best interest and negotiate the best possible terms for them, might want to read on.
If you haven't heard about it yet, you will. Chase Bank in a memo to its Asset Managers, announced the Chase Finance Initiative. In an attempt to capture more of the loans that are being done on their REO properties, Chase is encouraging their asset managers to promote Chase financing.
Problem is, they are in violation of RESPA and FTC guidelines and more importantly putting your clients at a serious disadvantage in the negotiation process.
I'm going to quote directly from RESPA Section 9 and FTC Guidelines for Antitrust Laws, so bear with me if it's a little dry. I'm also going to quote directly from the Chase memo that outlines their Chase Finance Initiative.
RESPA Section 9 - "Section 9 prohibits home sellers from requiring home buyers to purchase their settlement services from a particular company either directly or indirectly, as a condition of sale. Buyers may sue a seller who violates this provision for an amount equal to three times for all charges made for the title insurance." "Settlement service means any serive provided in connection with a prospective or actual settlement including but not limited to any one of the following: Origination of a federally related mortgage loan...Rendering of services by a mortgage broker..."
FTC Guide to the Antitrust Laws - "For competitive purposes, a monopolist may use forced buying, or "tie-in" sales to gain sales in other markets where it is not dominant and to make it more difficult for rivals in those markets to obtain sales. This may limit consumer choices for buyers wanting to purchase one ("tying") product by forcing them to also buy a second ("tied") product as well. Typically, the "tied product may be a less desirable one that the buyer might not purchase unless required to do so, or may prefer to get them from a different seller. If the seller offering the tied products has sufficient market power in the "tying" product, these arrangements can violate the antitrust laws."
Refusal to Deal - Sometimes the refusal to deal is with customers or supplier, with the effect of preventing them from dealing with a rival: "I refuse to deal with you if you deal with my competitor".
Chase's plan?"3. Sell the fact that buyers are more likely to receive seller assistance with closing costs by using Chase financing""8. In multiple offer situations, advise the agent that the seller will generally put more weight" on an offer with Chase financing than any other offer."
As a Realtor, you're really going to like this section from the Chase Finance initiative: "With Chase as our primary client, (asset manager name withheld) must work with Realtors who understand the importance of Chase financing on Chase owned properties and we will begin to limit our relationships to those who can adhere to these guidelines."
I'm sure there are more examples but here are three brief ones, that amplify the disadvantage your clients would have when negotiating with Chase:
1) The lender selected by your client has a more favorable interest rate than Chase, but in order to get their offer accepted, they will have to take the higher rate by using Chase.
2) Your client asks for closing costs to be paid by Chase, but in reviewing your client's financials determines your client has the ability to pay them, and Chase counters accordingly.
3) Your client makes an offer on a Chase home that is priced below the maximum amount for which they qualify. Even though your buyers are making a prudent financial decision, Chase can counter to a higher amount solely because they know your buyer can qualify for the higher price. Think your buyers might accept the higher price if they've already written 20 offers?
This probably isn't something that can be won in a court of law, but perhaps it can be won in "the court of public opinion".
Pass the word, reblog, protest, make t-shirts, just do something. As other banks follow this lead it will be more difficult for us to best represent your client's interest.
As Howard Beal said: "I want you to get up right now! and go to the window, open it, stick your head out and yell I'M MAD AS HELL AND I'M NOT GOING TO TAKE THIS ANYMORE!
If you missed this, regarding the Home Valuation Code of Conduct, HVCC, here's all the news about it from the beginning. Read this and you will see why Realtors should care about HVCC:
Here's the link to the petition. hvccpetition.com Even if your only concern is costly appraisals or lessening the wait time for appraisals you should sign it, but there is so much more to know about this bill that is on it's way to being phased out. The National Association of Realtors has done a great job for us in getting this bill (HR 3126) ammended and improved so that licensed loan originators can choose their appraisers directly.
Here's why you should care:
According to the NAR, the HVCC increases the costs for appraisals and limits the buyer's choice and ability in obtaining an accurate appraisal. They further state that the HVCC puts home buyers at an increased risk by mandating the use of unregulated Appraisal Management Companies (AMCs) for appraisals. The HVCC will also increase the time that it takes for buyers to get loans. This will lead to higher rates and costs for borrowers. If a home owner finds a better interest rate or needs to change mortgage companies, he or she will be responsible for purchasing a new HVCC compliant appraisal.
The House Financial Services Committee has just passed an amendment to the Consumer Financial Protection Agency Act to phase it out, and allow all loan originators, licensed or registered in accordance with the SAFE Mortgage Licensing Act, to order appraisals directly. H.R. 3126 is the number of this bill. Although this is just a committee vote, and still has a long way to go, it is a "first step" the Consumer Financial Protection Agency Act is expected to be merged with a number of other regulatory reform bills before moving to the House floor for a vote, and any differences must be ironed out within the House and then with any Senate versions before going to the President.
We have HVCC on the ropes so we need your help more than ever!
On Wednesday, October 21st, the National Association of Mortgage Brokers used this petition hvccpetition.comto help convince the House Financial Services Committee to pass an amendment that will finally put an end the mess that HVCC has been making of the real estate and lending industries. More than the 102,000 signatures on the petition, it was the pace at which the petition is growing and the HVCC horror stories signers included with their electronic signatures. Now more than ever we need everyone to rally behind this cause to make absolutely certain it continues to gain the momentum necessary to make it through the House and Senate votes that are forthcoming. Please, please, Please, sign this petition if you haven't done so already and more importantly, send it to everyone you knowin any sector of the real estate and lending industry as well as to all the current, past and future clients in your database. The new petition website makes it abundantly clear how all homeowners are losing equity and being harmed directly by HVCC as well as how it is blocking any chance at the real estate recovery our economy needs so desperately. Everyone you send to hvccpetition.com will be indebted to you for looking out for their best interest. We won the first of three battles which is more than anybody thought could happen and if we get serious and rally together now for one last massive push we should be able to put HVCC behind us forever. Thank you for your time, effort and support.
Frank Garay and Brian Stevens Co-Hosts of the TBWSDaily.com real estate news program tbwsdaily.com "Concerned advocates for a better real estate industry"
How HVCC Affects the Appraisal Process
REALTORS® and mortgage brokers are prohibited from selecting appraisers. Lenders are may use "in house" staff appraisers to conduct appraisals. However, the loan production staff is prohibited from:
selecting, retaining, recommending, or influencing the selection of an appraiser; and,
conducting any substantive conversation with an appraiser or appraisal management company regarding the appraisal assignment.
For the consumer, the appraisal process has remained largely intact. However, consumers may find the process takes longer than and may be more costly than it has been in the past.
A client called me and told me about a home he wanted to write an offer on. He found the home on the Redfin website. Problem was, I could not find the listing anywhere except Redfin....Redfin is showing this home as a listing that was posted only two days ago. No listing agent to present the offer to either.
Riverside County Tax Records showed it as being in "pre-foreclosure" status. The "source", of the Redfin data said it was pulled from SANDICOR, which is the MLS for San Diego County. That's funny, I thought unless some out of area agent posted it in their MLS system only. This was a dilemma so I decided to go to the home in person and check it out.
Here are the current day pictures taken today 10/24/09, next to the Redfin photos that are from at least 10 years ago.
Here's the backyard: Present day and Redfin's posting.
Same Patio but now it has rusted nails and is coming apart.
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Next, is a picture of the inside all furnished and pristine along with my photo that I had to take through the window because the home is vacant and abandoned.
Here are some more of the current day pictures:
This is the back fence that has been broken into!
Notice the mold and graffitibelow and mold going up the chimney.
Here's the proof, looking out the front door the tree is huge now and was much smaller in the Redfin photos.
I am so tired of false information causing me to have to investigate these kinds of old
and outdated properties with ancient information.
I will continue to post about this and educate my clients not to depend on Redfin, Trulia, Realty Trac, Zillow or their agents for accurate information!
Only the MLS has "Pure MLS" information.
All of these free Internet sites have recorded information such as, quit claim deeds, Trustee's deeds, Mechanics liens, Tax Liens mixed in with listings. To make matters worse they have a trigger response that pulls pictures from our MLS even from closed listings that have long been sold, and makes it look like a current listing.
This should be a violation of providing false facts.
*****
If I, as a Realtor...
posted old pictures like this and did not disclose the present condition of the property....
I would be held responsible by the DRE for providing false information. There have been lawsuits against Realtors for posting false pictures...Why does Redfin get away with it?
Schwarzenegger Signed SB 94 on October 12, 2009. This new version of the bill will do much to protect consumers from loan modification companies who are taking advantage of hopeful consumers in trouble.
We should all begin to see a lot less advertisements from dishonest loan modification companies now that they cannot charge their ridiculous upfront fees.
The Department of Real Estate has received massive complaints from consumers being asked to pay upfront fees as much as $4,000 for companies to negotiate a loan modification for their delinquent loans.
Senate Bill 94 goes into effect immediately and does not expire until January 1, 2013
Here are the fine points of the bill:
•· Any firm, be it lender or lawyer, yes, I said lawyer, must tell potential clients that they can get the same services for free from government-approved nonprofit mortgage counselors. I'm sure this will be in the form of a disclosure.
•· No payment can be received until the loan modification company including lawyers has performed all services promised in a contract with the borrower.
•· Borrowers are still obligated to pay the loan modification firm for services provided, even if the firm can't get the loan modified.
•· No more negative amortization loans
•· Limits the amount of pre-payment penalties a lender can charge
Why attorneys don't like the new version of SB94: I just read an interesting article that went on and on about how homeowner's will not be able to secure legal advice now due to the fact that loan modification attorney ask for retainers whenever they assist a consumer with a legal matter. The author went on and on about how this is hurting consumers.
Actually, they are worried about it hurting their practices of collecting retainers in advance of doing anything, which has always bothered me. Let the attorneys collect their fees after they do their work for a change.
Here's one quote from a blog circulating around the internet....author unknown:
(SB 94 prevents loan modification companies, brokers, individuals... and even lawyers... from receiving fees or any other form of compensation until after the contracted services have been rendered. What loan modification company in their right mind would go through 120 days of work negotiating a loan modification with their client's lender only to have the client say, sorry we don't have the money to pay you for your services.)
Personally, I think it's about time that lawyers were held accountable for their work. Lawyers are the only professionals who are allowed to collect very large advance fees before they do anything.
First time Real Estate Investors are plentiful right now, but they want large and immediate returns that are unrealistic. Yesterday, I got an investor from Trulia who wanted a 15% return, immediately. Not possible, I told her. And I gave her the reasons why she could not get an immediate return like she wanted.
There are no homes that a buyer can flip and make an immediate 15% return, here is Southwest Riverside County. Unless, you buy them at a court auction.
In order to make at least $20,000, you would have to purchase a home at $200,000 and turn right around and sell it for $260,000 minimum. This is taking into consideration all expenses, commission, escrow fees.
It's just not possible to flip properties in our current market, here in Southwest Riverside County. Prices are not going up in a matter of weeks. The buy and hold strategy is the only strategy that makes sense.
Investors who use the "Buy and Hold Strategy", are the only ones buying right now.
"Don't wait to buy Real Estate, Buy Real Estate and wait, I told her.
Investors who can wait it out will benefit a great deal by buying now and waiting to sell when the market improves. Problem is most don't want to wait. There are so many great Real Estate books out that explain this theory: Here's a great book by David Schumacher.
Here's a model I gave one investor for a quick $20,000 gain. He thought it was fair but still wanted me to guarantee him this return on a property before he purchased:
Model for a quick $20,000 return:
Purchase Price $175,000
Includes all fees, escrow, transfer tax, notary – paid for by Investor* - these fees are minimal to you when using cash.
*(Title policy and commissions are paid for in initial purchase by the bank, for bank owned properties).
Costs you will incur to sell property
5% of original price you paid for improvements – $8,750.00
1.5% of sales price to new buyer for Title and Escrow Fees- $ 3,375.00 (Based on Purchase Price of $225,000)
3.5% Commissions- $7,875 (Based on Purchase Price of $225,000)
4% of Closing costs paid for FHA or VA Buyer – (Based on Purchase price of $225,000)$9000.00
Subtotal…….. $204,000
$225,000(Sales price when you market and sell the home the home)
-$204,000- less all costs
$21,000 - profit to you
New List Price to new FHA buyer$230,000 - Let new buyer offer as little as $225,000 because everyone likes to feel they are getting a deal!
Sales price can be as low as $224,000 for you to make at least $20,000
Quick Calculation: Multiply your original purchase price by 130 percent to get the new approximate listing price required to make at least $20,000.
Temecula has so many wonderful and picturesque spots along Rancho California Road . The wineries are lovely, the grapevines are plentiful and if you are wanting to know the best ones then stay tuned as I have plenty to tell and write about.
Wilson Creek winery is well known for it's "Almond Champaigne", but if that wasn't enough, it also has many other attributes. Like the Creekside Grill that's celebrating it's 1 year anniversary this month. Plus, there are exciting, upcoming holiday events. Here's a handful but to view all, visit their site.
I love living and working in Temecula, there's no other place in Southwest Riverside County that has such lovely and picturesque scenery only minutes from shopping and the freeway!
"I'm a great believer in luck and I find the harder I work, the more I have of it". - Thomas Jefferson
Hmmmmm.........I guess I need to keep telling my teenagers, how lucky they are whenever they are working!!! Reverse psychology, maybe? I'll try anything!!!
Redfin just came out with the IPhone application showing all kinds of information. The problem is that it is showing all of the recorded documents, (liens, Notices of Default, Quit Claim Deeds), that have recently been recorded at the individual County Recorder's offices across our nation, as "Sales and or Sold properties".
My clients were riding around with me checking sold properties as well as active, just to see if the asking prices were in line with the current asking prices. Checking recent sold comparables is always a useful thing to do, right???
Here's an example of the problem that some internet sites are creating: This property located at 29045 Via Norte is showing as a sold property that sold for $27,272 dollars on August 20, 2009.
By investigating this recording, I was able to find out that this amount showing as sold was actually quit claim deed between two family members. It was not a recorded sale of a property between a buyer and a seller and cannot be used as a comparable as comparable properties that are actual sales are going for much more. Approximately $275,000 more!
*****
Redfin, Zillow, Trulia, and all of the other Real Estate sites that consumers use to search for properties are the same as far as where they get their data. They all get it from the County Recorder's office and label it all together as a property that is either sold or for sale.
Consumers need to be aware that when all of the information is mixed together it cannot be relied upon as "Pure MLS".
The same is true when searching for active listings. They are all mixed together and cannot be separated out from properties that have been sold between a buyer and a seller.
Other recordings that are picked up as for sale or sold properties are:
Notices of Default
Mechanics liens
Tax liens
Refinances
Home Equity Lines of Credit
There is still no Real Estate Search capability as accurate as Multiple Listing Services that are used by professionals who pay for and are registered to use the MLS.
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Want more proof?
Here it is! While researching today I found this exchange between a consumer and one of the Redfin Czar's.
Here's another:
This is the answer from the Redfin CZar, actually admitting there are issues with the search capabliities: He mentions in his explanation that they get information, "from a third party and that they do not distinguish from actual sales and other types of transactions. (Like I mentioned in the billeted items above).
Again, there is still no Real Estate Search capability as accurate as Multiple Listing Services that are used by professionals who pay for and are registered to use the MLS.
Use Redfin, Trulia, Zillow or a site similar to these if you want to play and experiment with real estate information but call a Realtor who belongs to a "Multiple Listing Service",if you would like complete and accurate Real Estate Information for the area you are serious about making a purchase in!
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.
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With Halloween out of the way, Thanksgiving and Christmas are right around the corner. Many people are experiencing difficult times with job loss and foreclosures still on the rise. Sometimes, I think that Real Estate Professionals see more hardship than other professions, especially here in Riverside County, and other areas that have a large amount of foreclosures.
Schwarzenegger Signed SB 94 on October 12, 2009. This new version of the bill will do much to protect consumers from loan modification companies who are taking advantage of hopeful consumers in trouble. 
Redfin just came out with the IPhone application showing all kinds of information. The problem is that it is showing all of the recorded documents, (liens, Notices of Default, Quit Claim Deeds), that have recently been recorded at the individual County Recorder's offices across our nation, as "Sales and or Sold properties".
