Of all the delays that REO buyers must endure, this tends to be the most difficult to swallow. After you've crossed the finish line, the loan funded, and you've waited the additional day for the transaction to record, NO KEYS! I've had this happen about 3 times, but it is beginning to be a trend on REO purchases that buyers cannot get the keys to their new home until the day AFTER the transaction closes. Banks centralize their escrow and title work on foreclosures, so you are almost always dealing with an out-of-town escrow company that is overburdened with work and often doesn't care about your individual transaction. The usual practice is for the escrow company to record the transaction, and then confirm the recordation. In a "normal" sale, using a local escrow company, the new deed is recorded and confirmed on the same day many times before 10am. However, as with anything else on an REO purchase, this now takes longer.
I was actually getting used to the fact that on most REOs, confirmation is generally not available until the very end of the day. However it appears that, rather than hire a few more people, escrow companies handling REOs are contracting out recording documents and also confirmation of recording to third party companies. So, now buyers are being told that their transaction cannot be confirmed, and keys cannot be handed out until the following day. And it seems to me that the time these escrow companies spend fending off irate buyer's agents, could easily be spent making phone calls to confirm recording. When discussing the lack of customer service at these escrow companies, one of my buyers asked me recently "am I really paying for people to treat me this way?" My answer could only be - "unfortunately you are."
My first two experiences with this happened on the same Friday when buyers were rightfully expecting keys. I called one of the escrow companies right before close of business expecting confirmation, and they claimed that confirmation was generally not available in Santa Barbara County until the following day. Needless to say, no one appreciates being lied to, but especially not on Friday at 5pm. What is unusual is that the local offices of these same escrow companies function in a completely different way. Unfortunately, it is impossible to direct the transaction to a local office. There is some controversy surrounding this point, as I am told the law in California requires that buyers have choice about their escrow company - and REO buyers effectively have none. Like almost all of the other terms of the REO contract, if buyers do not agree, they are passed over for another buyer.
I do believe that this issue of late confirmation will ultimately be resolved either by a statement from a regulating agency, or by litigation. It is beginning to get out of hand. It is not hard to imagine that a buyer would incur damages from this, and my past experience as an attorney tells me that with damages comes litigation. Many times, boxes are packed, moving trucks are in motion, and painters are scheduled. Not to mention the simple fact that the buyer is paying for a property they can't access. Because of this and other possible delays, I try not to schedule REO closings for Fridays; however, many times the REO seller chooses the closing date in their addendum. Also, I advise buyers that REOs often close late due to seller and escrow delays. This is just another delay to watch out for when buying an REO.
I specialize in helping people navigate the process of purchasing foreclosed properties here on the Central Coast. If you would like a list of bank owned properties (REOs) in the Santa Maria, Lompoc, or surrounding areas, send an email request to me at tni@mintprop.com. Or give me a buzz at (805) 878-9879 and I will set up a personalized tour of homes for you.
*Based on the information from the Central Coast Regional MLS. The Association, the Multiple Listing Service, nor Mint Properties guarantees or is in any way responsible for its accuracy. Data maintained by the Association or its MLS may not reflect all real estate activity in the market. Buyers are advised to consult with their own attorney for legal advice - this blog does not offer legal advice.
I would like to announce a new foreclosure property search on my website: www.BuyCentralCoastForeclosures.com. Potential buyers can search for pre-foreclosure, auction, and bank owned properties. So, you can find information on properties throughout California once they have a Notice of Default (the first step in foreclosure) filed. Some of these properties are already listed as short sales on the local MLS. In some of the cases, the owners are still trying to work out terms for a deed in lieu of foreclosure, catch up on payments, or get a loan modification from the lender. And, if they are successful in working out a loan modification those properties will not hit the retail market for homes. Those that complete the foreclosure process at auction (trustee's sale) will come back as bank owned properties.
I specialize in helping people buy short sales and foreclosed properties. If you would like a list of foreclosure properties currently offered for sale, or are interested in listing your home as a short sale, send me an email at tni@mintprop.com, or give me a call at (805) 878-9879.
Based on the information from the Central Coast Regional MLS. Neither the Association, the Multiple Listing Service, or Mint Properties guarantees or is in any way responsible for its accuracy. Data maintained by the Association or its MLS may not reflect all real estate activity in the market.
I just received a counter offer back on a Bank of America property (formerly Countrywide) with a new twist that I haven't seen before in REO contracts. Countrywide officially became Bank of America Home Loans about two weeks ago. I've sold quite a few Countrywide REOs and was used to how they did things. However, it appears that the switch over to Bank of America has changed some things.
This counter offer indicated that an "over list price offer shall not be contingent upon property appraising at purchase price." So, if you bid over the purchase price, you must be able to and willing to pay that price regardless of what the property appraises for. On the one hand, this may discourage buyers from overbidding properties and then hoping that the appraiser will save them from their own bad judgment. Also, some buyers bid way over what is reasonable as a strategy and then use the appraisal to end up paying a price that other bidders most certainly would have been willing to pay. A clause like this may cut down on that type of behavior.
However, where buyers bid up a property $5,000 or $10,000 over current values in an effort to win a bid in this competitive market, their fate may rest on that particular appraiser's viewpoint of whether our market has stabilized or is still declining. For buyers who are not cash heavy, and cannot make up the difference, this can place yet another obstacle in front of them.
REO contracts are notoriously one sided in favor of the bank, but I had not seen this particular term in another REO contract until now. Ideas in the REO world tend to spread like wildfire; once the bank's in house counsel learns that another bank is writing in a particular term they many times want to toss it into their standard agreement as well - after all why not? So, if this catches on, we may unfortunately see more and more of it. I hope it is not a sign of more to come.
I specialize in helping people buy foreclosed properties here on the Central Coast. If you would like a list of bank owned properties (REOs) in the Santa Maria, Lompoc, or surrounding areas, send an email request to me at tni@mintprop.com. Or give me a buzz at (805) 878-9879 and I will set up a personalized tour of homes for you.
*Based on the information from the Central Coast Regional MLS. Neither the Association, the Multiple Listing Service, or Mint Properties guarantees or is in any way responsible for its accuracy. Data maintained by the Association or its MLS may not reflect all real estate activity in the market. Buyers and sellers are advised to consult with their own attorney for legal advice - this blog does not offer legal advice.
Currently, there is intense competition among buyers in the Santa Maria market. If this is a buyer's market, it sure doesn't feel like it anymore. Indeed, with the banks calling almost all the shots in the under $300,000 market (short sales and foreclosures), it certainly feels like a sellers market.
There are 442 active or contingent listings in Santa Maria and Orcutt. However, over half of those listings (248) are contingent short sales, and only 35 are active REO listings. The contingent short sales are in the waiting stage, i.e., waiting on bank approval of their terms. The REO (bank owned) listing inventory appears to have shrunk in the last couple of months, with buyers waiting on the sidelines to pounce on the next bank owned listing.
It is not unusual to find that a foreclosure listing has received 15 offers. As a result, buyers are also heavily concentrating on short sale inventory. Multiple offers on the first day are also quite common for short sales. 271 units are pending, 49 of those are short sales, and 128 of them are REOs. In the past 30 days, 128 single family residences were sold in the Santa Maria - Orcutt market; 68 of them were REOs, and 31 were short sales.
In this fast moving market, emailed property listing alerts are a must. If you would like email alerts or a list of available homes in the Santa Maria or Orcutt area, send an email to me at tni@MintProp.com. You can also search for properties on my websites: www.iLoveSantaMaria.com, www.SantaMariaRealEstateSearch.com, & www.BuySantaMariaForeclosures.com (map based search). If you have questions about a specific property, or would like to set up an appointment to consult about a possible short sale of your property, I can be reached at (805) 878-9879.
Based on the information from the Central Coast Regional MLS. Neither the Association, the Multiple Listing Service, or Mint Properties guarantees or is in any way responsible for its accuracy. Data maintained by the Association or its MLS may not reflect all real estate activity in the market.
Home sellers often ask what they can do to make their home sell quickly for the price they want. I believe that this is a great market for realistic sellers. Realistic meaning sellers who do not expect to get housing boom era pricing for their homes. There is actually a shortage of easy to buy homes on the market in the Santa Maria, Orcutt, and Lompoc markets. The market is clogged with short sales that often sit stagnant waiting on bank approval. Homes and condos that are priced right are receiving multiple offers. That being said, time and time again I see sellers make critical mistakes when trying to sell their home.
1) Don't make your home difficult to be shown. Some home buyers give their agents a lot of notice about viewing homes. But I've found that many if not most give very little notice. Or, by the time they arrive in a real estate agent's office they may have completely changed their mind about what type of house they want to buy. As a consequence, homes that are easy to show with very little notice get shown more often and receive offers quicker than the home that can only be shown with 24 hours notice, with the listing agent present, on Saturdays between 1pm and 1:30pm. If you have to make some showing restrictions, try to make your home available when most buyers want to see homes, on weekends and after work.
2) Don't stick around and make conversation with potential buyers. You are not a salesperson, that's why you hired an agent! Most buyers will feel obliged to listen and follow you around the home, but leave feeling that they didin't get a chance to truly experience the home. They want an opportunity to envision themselves in the home. The seller's presence weighs heavily on the mind of the buyer and most are distracted by it. I've found that often buyers will ask to see the home again, hoping that the next time the seller will not be present. If you have to be home, try to stay out of the way and let the agent do the showing, and only answer questions that are directed to you.
3) Don't price your home too high and risk riding the market down. Pricing your home too high in this market is a dangerous bet. If there haven't been any foreclosures in your neighborhood, or there are none currently listed, you may feel that you can try out a higher price. However, the moment a foreclosure hits the market in a comparable neighborhood, it will likely determine what you can ask for your home. It is better to begin with a reasonable price than to be hammered by a foreclosure that pops up. Timing is very critical in this market, if you price your home at $400,000 when it should be priced at $350,000 and wait, a comparable foreclosure may pop up at $320,000, and now $350,000 isn't even so appealing to a buyer. This happens often as foreclosures are deliberately priced below market in order to sell fast.
If you would like a market analysis of your Santa Maria or Orcutt home, send an inquiry to me at www.SellMySantaMariaHome.com. If you owe more on your mortgage than your home is worth, you may be able to short sale your home, if you would like to set up a short sale consultation, please contact me at (805) 878-9879.
Based on the information from the Central Coast Regional MLS. Neither the Association, the Multiple Listing Service, or Mint Properties guarantees or is in any way responsible for its accuracy. Data maintained by the Association or its MLS may not reflect all real estate activity in the market.
For those looking to buy your first rental property, or pick up an extra one now that prices make sense again, be aware that lenders have rolled back the down payment requirements for investment property. Most lenders I polled recently say that a 20% down payment is required for an investment property. Many of us remember when lenders required a 30% down payment for investment property, and I wonder how long it will be until we are back to those days. Lenders slowly but surely decreased the down payment requirement for investors during the housing boom and have slowly but surely increased that obstacle again. So, many would be investors who were waiting for prices to drop are now locked out of the market by down payment requirements. It is an interesting phenomena as prices drop lower and borrowed money becomes harder and harder to obtain.
Hidden Pines is a lovely little gated community located in northwest Santa Maria. It boasts a private park and streets, and borders the Santa Maria Riverbed walking trail. The homes were built approximately 15 years ago and feature tile roofs and 2 car garages. The development is surrounded by other popular developments, Cherry Blossom Ranch, Essex at Willow Creek, and the gated community of Regency Estates. Hidden Pines offers convenient access to Highway 101 and is walking distance to Presiker Park. The association fee is about $65 - $75 per month. The last resale I found for the development was a bank owned 3 bedroom, 2 bath, 1400 square foot home which sold for $200,000 on January 30, 2009.
Hidden Pines
If you would like information or a list of available homes in the Hidden Pines development or in the Santa Maria or Orcutt area, send an email to me at tni@MintProp.com. You can also search for properties on my websites: www.iLoveSantaMaria.com, www.SantaMariaRealEstateSearch.com, & www.BuySantaMariaForeclosures.com (map based search). If you have questions about a specific property, or would like to set up an appointment to consult about a possible short sale of your property, I can be reached at (805) 878-9879.
*Based on the information from the Central Coast Regional MLS. Neither the Association, the Multiple Listing Service, or Mint Properties guarantees or is in any way responsible for its accuracy. Data maintained by the Association or its MLS may not reflect all real estate activity in the market.
I know the media is saying that the real estate market is in the dumps. And I guess if you were hoping to get housing boom era prices for your home, it is. But if you are a Santa Maria or Orcutt home owner who needs to sell your home, you should know that the Santa Maria real estate market is hot! Why do I say that? Because homes that are priced in line with today's market that are not short sales, sell in less than a week. I feel as if this is a hidden secret in today's market place. Everyone believes that it is hard to sell your home right now, but even short sales that are well priced are receiving multiple offers. What does this mean if you need to sell your home? Don't despair, even if you owe more than it is worth. Current inventory is not meeting demand. I have plenty of buyers who are waiting for the right home to be listed.
If you would like information or a list of available homes in the Santa Maria or Orcutt area, send an email to me at tni@MintProp.com. You can also search for properties on my websites: www.iLoveSantaMaria.com, www.SantaMariaRealEstateSearch.com, & www.BuySantaMariaForeclosures.com (map based search). If you have questions about a specific property, or would like to set up an appointment to consult about a possible short sale of your property, I can be reached at (805) 878-9879.
*Based on the information from the Central Coast Regional MLS. Neither the Association, the Multiple Listing Service, or Mint Properties guarantees or is in any way responsible for its accuracy. Data maintained by the Association or its MLS may not reflect all real estate activity in the market.
In the past couple of weeks, I have had two clients shop for mortgages online after securing a contract on a home. Both came back with inaccurate information. My advice to both was to use a local lender. It is good practice and natural to shop your loan rate and terms, and online shopping is very appealing because you can do it at your convenience. But, I highly advise my clients to shop their loan with local lenders for several reasons inspired by experience:
1) Responsiveness. Local lenders tend to respond quickly. Even if you are considering using a national company, I find you get a quicker response by approaching a local agent of that company rather than filling out a form on a website and waiting for a call back. Recently, a client of mine wanted to use a lender that he had a long established relationship with who was out of Tennessee, but due to time zone differences and a total inability to reach them on weekends, he could never get what he needed when he needed it. He ended up switching to a local lender.
2) Accuracy of information . In my example noted at the start of this post, both my clients were given bad information. One was told by an online lender that they could offer a 5% conventional loan in our market. However, I cautioned my client about this and advised further inquiry. When he pressed the issue with the lender, they did the research and acknowledged that the product was not available in our market - something that a local loan officer would have know right off the bat. The other client was told he could avoid the FHA upfront mortgage premium if he put 5% down. This information turned out to be totally off the mark and probably the result of an inexperienced loan agent answering the company's toll free number.
3) Transaction delays. Most of my clients are buying bank owned properties right now. In these transactions you are dealing with delays because the seller and sometimes the listing agent are not local. In addition, bank sellers almost always demand that an out of town escrow company be used as well. This inevitably adds to delays in a transaction. Adding an out of town lender to the mix can make an already difficult process more complicated with regard to timelines.
Approximately 25% of the 500 active single family listings in the Santa Maria California market are "contingent." Buyers run up against this time and time again, and often wonder, "what exactly is a contingent listing?" Before the housing bust, "contingent" was primarily used when a seller accepted a contract that was contingent upon another home selling. For example, if I offered to buy your home but I needed to sell my own home to make that happen, I could make an offer contingent upon my home sale. The seller could then accept that offer and continue to offer their home as available, and if they received a better, or non-contingent offer before I removed that contingency, they could serve notice upon me (the first buyer) to either remove that contingency or walk away from the deal.
Now that the foreclosure driven markets are dominated by short sales (almost half of the Santa Maria and Orcutt market is short saled), contingent usually means contingent upon bank approval, i.e., the seller has received at least one offer that they have accepted and presented to the bank for approval. It does make sense to shop contingent listings because buyers are playing quite a musical chairs game right now. Since there is not much available that can be bought easily, buyers shop short sales and REOs at the same time. Many times when an approval comes in the original buyer is no longer interested. Also sometimes a short sale listing that is marked active really is contingent but the broker has instructed the seller not to sign any offers until they have bank approval - so they continue to market they property as active even though they have at least one offer on it.
If you would like a list of Central Coast short sale properties, send me an email at tni@MintProp.com. Also, keep in mind that contingent listings from the Central Coast Regional MLS do not show up on Realtor.com, but they are displayed on my website CentralCoastRealEstateSearch.com. If you would like to consult about a possible short sale of your property, I can be reached at (805) 878-9879.
*Based on the information from the Central Coast Regional MLS. Neither the Association, the Multiple Listing Service, or Mint Properties guarantees or is in any way responsible for its accuracy. Data maintained by the Association or its MLS may not reflect all real estate activity in the market. Not intended to solicit listings currently under contract with another broker.
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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