Okay, I admit it - after the week I have had, from the bizarre to the just oh my gosh, get me out of here, I am feeling a tad worn.........this business used to be so easy!

I got a phone call - yes, another phone call - from what I thought was a principal! Whooohoooo - love those calls - and better yet, the seller would like to sell for approximately $5,000,000! WOW! It's gonna be a great week!

During the course of the conversation, however, my bubble certainly deflated..........this wasnt a principal at all - this was some young couple trying to break into the luxury home market - and they need my help.

But wait - are you licensed I ask? Well, no..........

And that's where it started to go downhill.

Turns out they are approaching home owners and offering to sell their homes for a certain price and if they obtain said price - they receive a commission - if they get above said price, they get the difference. If the owner in this case receives 6,200,000 for her home, this couple receives 1,200,000 in commissions. And if I help them bring in a buyer, I get 35% of their commission!

Sounds great - but it aint legal!

I mean seriously, do these folks think they were the first ever to think of this? Nope, I am certain many have come up with this one before - and dealt with the $50,000 fine, too! (Because they are an LLC, they have a 50k fine versus an individual who faces up to a 10k fine - both however, can also face up to 6 months in county jail!).

As I told them, there is a very good reason for a seller to hire a Realtor; not just anyone can sell a home and having done it once or twice does not an expert make!

Do I have an obligation to notify the DA's office? The seller? This is my own personal gray area and I am not sure what I will, wont, can or cannot do. I do not want to hurt anyone but I personally am tired of having to deal with fraud, fakes, flakes and all other sorts of F words I can come up with. I am tired of flaky agents reflecting negatively on the rest of us as well.

I did explain a little to this couple that with disclosures - to which they are not privy - they not only cover the sellers' interests, but their own. They werent sure what I meant - how scary is that?

They did tell me that there are a ton of agents interested in helping them - I bet! However, the agents cannot list the property in the MLS! The agents can't take a listing agreement on the home, either. So, what would an agent be able to do for these folks? Not much!

What I told them was simple:

It is ILLEGAL to sell real estate without a license in the state of CA. The DRE states - CODE 10130 - It is unlawful for any person to engage in the business, act in the capacity of, advertise, or assume to act as a real estate broker or a real estate salesman within this state without first obtaining a real estate license from the DRE. If you are caught, you will be fined and possibly jailed.  

The code is further broken down: (2) sells or offers to sell, buys or offers to buy, solicits prospective sellers or purchasers of, solicit or obtains listings of, or negotiates the purchase, sale or exchange of real property or a business opportunity. The same laws apply for leasing as well.   It also states (e) Sells or offers to sell, buys or offers to buy, or exchanges or offers to exchange a real property sales contract or a promissory note secured directly or collaterally by a lien on real property or on a business opportunity, and performs services for the holders thereof.  

The website they designed for this home? Right now, the websites, etc, are illegal; you cannot post them - you cannot advertise on behalf of the seller without your real estate license number on all ads, websites, emails, etc.

The legal homeowner is the only one who can sell by owner and if they hire a representative is must either be an attorney or a licensed realtor.   Code 10137 states: It is unlawful for any licensed real estate broker to employ or compensate, directly or indirectly, any person for performing any of the acts within the scope of the above described acts, who is not a real estate licensee; no real estate salesman shall be employed by or accept compensation from any person other than the broker under whom he is at the time licensed. It is unlawful for any licensed real estate salesman to pay any compensation for performing any of the acts within the scope as described above   Code 1017.1 Provided every partner through who the partnership so acts is a licensed real estate broker...............   Code 10139: Any person acting as a real estate sales person without a license or who advertises using words indicating he or she is licensed without being so licensed shall be guilty of a public offense punishable by a fine not to exceed $10,000 or imprisonment in the county jail not to exceed 6 months; if a corporation - such as your LLC, it is a fine of $50,000.  

I didnt bother to go into the details such as when an escrow company gets involved - the escrow company cannot pay a commission to a non-licensed individual; yes, the seller can pay them or even instruct escrow to do so, and label it something else I am sure. But, legally, this appears to be a gray area.  

I dont know what they plan to do, if anything; like I said, I dont know what I will do - if anything. I would love your comments and advice - as sometimes it is hard to see the forest for the trees.

I do know that I will NOT be assisting them in anyway - not unless the seller approaches me directly; as I explained above and to them, I cannot give them any sort of compensation if this happens - unless they have a license! 

Well, Mercury is definitely Retrograde..........here's to another adventurous week in real estate!

It's that time of year again, Mercury is in Retrograde!  Bringing about those time-eating traffic jams, snafus related to communication, computers and technology that just doesn't seem to be wired right, and a tendency to forget that which we already know, are just some of the many annoyances that occur during this period of September 7 to 29.

Funnily enough, that doesnt appear to be all that's happening! Now as a local agent, I get calls all the time from clients or potential clients, complaining about the market, the buyers, the sellers, etc, but rarely do I get a call like one which I received yesterday.

Now let me preface this by saying first and foremost, all I did was listen - all I am legally allowed to do is listen. I did not comment, advise (except to say to the caller, speak to your attorney) or offer any solutions whatsoever. Although, I wish I could have done so and in fact, my blood is still boiling from this conversation!

Let me back up! A few weeks ago I received a call from a family looking to sell their lovely home in Chatsworth*; it is in a desirable neighborhood and tract and because they were not upside-down, an easy and fast sales potential for me. I was excited to say the least as I am tired of the sad stories associated with short pays, although I have no qualms handling them, the sadness associated with them can be a little rough.

I digress.

So I met with them and was pretty confident I had the listing; both of the sellers were present (a newly married husband and husband, cute as can be!) and we all had a lot in common, they loved my "style" as well as what I was offering to do to get their home sold.

Needless to say, I was STUNNED when I received the call that I did not get the listing and instead they had gone with another agent; I asked why, although at this point I didn't really care - was choking back tears, thus not wanting to be the one doing the talking - I just wanted to take the pressure off myself for a moment, gather my composure (I am typically not quite so emotional but I am sure a lot of you agents will agree with me that in these times, a blow can be hard to take!), and I proceeded to take a few, albeit silent, deep breaths! Ahhhh breathe.............

What I heard next rocked my socks off; the agent they chose was charging them a flat fee of $1,700 to sell their home! WHAT THE (you can fill in your own blanks here)?????

Seriously? Seriously? Seriously!

What an INSULT to those of us busting our bums to get some business! I informed the seller that I cannot nor will I be able to beat that! But, I warned them, be careful as you typically get what you pay for.

My words have haunted them for weeks.......

The home came on the market approximately $150,000 LESS than TODAY's current market value - and $150,000 less than I would have listed it for - now I of course planned to show it right away as I had a few buyers looking for steals within that area. I figured the agent who listed it was trying to get a ton of offers and create a frenzy as well as sell it as quickly as possible because we all know you cannot afford to sell homes for that cheap and have them linger on the market for months on end! 

However, as you know,  there was NO WAY a buyer who was looking in this price range could afford to go up $150,000! So the seller was for sure going to lose money........by the time I got to the home the property's price had increased twice - going up about $50,000 -  and as I later found out, all without the seller's knowledge or acknowledgment. They were never told the price changed/increased nor did they sign anything advising them of the increase or give verbal or written permission for the increase. Hmmmm.....

You get what you pay for.

So, let's fast-forward a few weeks and the phone call I mentioned above that I received. The owners have now of course realized they are in jeopardy and are seriously regretting their decision. What can they do? My advice? Simple - call your attorney as I cannot interfere with another agents contract - but I can certainly listen!

And listen I did; I am shocked, appalled, embarrassed, angry and frustrated and the only way I can relieve some of this frustration is to write about it!

First of all, the agent does not have a fully-executed listing agreement; nowhere on the contract does it state the address of the property nor the APN. Only one seller signed, which in the state of CA is okay for list, but must be signed by all parties prior to the close. Neither did the seller EVER receive a copy of their listing agreement until they asked for it yesterday (yes, this resulted in a second phone call to me.....).

The BIGGEST issue I have, though, is that the agent changed the commission! Yes, I said it - yes, the agent changed the commission - so instead of $1,700 it now reads $3,700 (the 1 was changed to a 3) AND the agent is charging them a referral fee of 27%! WHAT THE (you can fill in the blank here)???? No, the agent did NOT have the seller initial these changes (the original contract was typed but the changes are handwritten) nor did the seller have any idea until they received their escrow instructions in the mail (and they did get a call from the agent prior to receiving them stating that they will notice a change on the escrow instructions but just ignore it). HUH??? The agent also changed the selling agents commission from 2.5% to 3%, again, making this change AFTER the seller signed the listing agreement! However, on the MLS it shows the commission at 2.5%! Can you say, funny business?Oh, just slightly!

The owner told me they asked him about the commission change; he said that it has ALWAYS been on the MLS at 3% (which is not true as it is listed at 2.5%) and that the selling agent agreed to give up .5% because the selling agent "doesn't know how to do anything" and the listing agent is "having to do all the work" (ya, I bet it takes a lot of hard work to figure out the best way to commit all sorts of fraud....) The agent then went on to tell the sellers that this is an agreement between agents and the seller doesn't need to know the details nor is it any of their business or concern. So, it's none of their concern that their agent is fraudulently obtaining more money? Their agent is jeopardizing a purchase? Nope, guess it's none of their concern!

Okay, so wait a minute; when I add up all these numbers the seller has just rattled off to me, the commission now actually exceeds 6%!! WOW! The seller went from signing a contract at a discounted rate of $1,700 and is now paying more than 6%!

UNBELIEVABLE! And this agent is allowed to walk the streets, taking business from you and I. Charming thought, isnt it?

And yet, sadly,  there's more!

The counter offer the agent sent to the buyer states that all contingencies are; for those of you who may not know what this means, it simply means come day 17 (or whatever day they agreed upon) the buyer doesn't have to sign a contingency release form - they are just released at the contracted time! HUH?

According to CAR and the DRE: The term "active removal" used when talking about a contingency means that a party must do something to remove a contingency.  Typically this means removing the contingency in writing.  For "passive removal" of a contingency, the party need do nothing and the contingency is automatically removed with the passage of time. 

HOWEVER, The RPA-CA as well as all the other C.A.R. purchase contracts require active removal of the buyer's contingencies.

So, in other-words, the seller signed this but it isn't even acknowledged or VALID in the state of CA! What this means for the seller is that the buyer can essentially have all of their contingencies in place, walk the day of closing, with ZERO repercussions! How scary is that?

And this agent is walking around taking business from you and I (yep, I said it again!)!!!!!!!

For those of you shrugging your shoulders or not feeling as outraged as I am, let me point out a few facts here (and forgive me my emotion, but I am very frustrated by this chain of events and more frustrated that I lost the listing due to fraud!).

I am acknowledging the errors to the best of my abilities and from state-to-state, these errors may be erroneous:

1. Ideally, an enforceable real estate purchase contract should include the identity of the parties, clear description of the property being sold, the price, the terms of payment, and the time for performance; their listing agreement contained none of these items, with the exception of the fraudulently adjusted commission. There are no seller names, address, etc.

2. A contract is valid only if the parties voluntarily consent to its creation. If a party to a contract can prove that his or her consent was not freely given, the contract can be avoided (is voidable). Consent is not freely given when it is obtained through fraud, mistake, or as a result of duress or undue influence imposed by the other party.

3. State of CA only allows for active removal of contingencies; the RPA-CA as well as all the other C.A.R. purchase contracts require active removal of the buyer's contingencies.

4. Now the issue as to the seller paying a referral fee to the listing agent isnt covered in the DRE or CAR rules or laws and is an ethical issue. However, if anyone does have info on this I would be curious to see it. Those of us who have ethical practices know this is wrong - why would the seller pay a referral fee when the agent wasnt referred first of all, and secondly - and most importantly - ANY referral fee of this nature (which I am not describing due to the nature and protection of all involved) is strictly the agents fee to pay, not the sellers.

5. 10176. The commissioner may suspend or revoke a RE license if the licensee is guilty of the following: Obtaining a signature of a prospective purchaser to an agreement without having first obtained the written authorization of the owner of the property. Demonstrated negligence or incompetence in performing any act for which he or she is required to hold a license. Engaged in any other conduct which constitutes fraud or dishonest dealing. Ya, there's this in spades.............

6. An agent has a duty to disclose to his/her client all material facts in a transaction unless it is disclosed to and approved by the client.  Per NAR Code of Ethics: When entering into listing contracts, REALTORS^® must advise sellers/landlords of: the REALTOR^®'s company policies regarding cooperation and the amount(s) of any compensation that will be offered to subagents, buyer/tenant agents, and/or brokers acting in legally recognized non-agency capacities. Article 6
REALTORS^® shall not accept any commission, rebate, or profit on expenditures made for their client, without the client's knowledge and consent. REALTORS^®, for the protection of all parties, shall assure whenever possible that all agreements related to real estate transactions including, but not limited to, listing and representation agreements, purchase contracts, and leases are in writing in clear and understandable language expressing the specific terms, conditions, obligations and commitments of the parties. A copy of each agreement shall be furnished to each party to such agreements upon their signing or initialing. REALTORS^® shall not offer for sale/lease or advertise property without authority. When acting as listing brokers or as subagents, REALTORS^® shall not quote a price different from that agreed upon with the seller/landlord.

Yes, I am upset, angry, mad, frustrated but ultimately, I am not affected by this accept guilty by association - agents like this give all agents a bad rap. When agents make these decisions, they affect ALL of us. These choices leave a bad taste in the mouth of the consumer - ultimately, we all just look bad.

What can we do? Nothing. The seller has a decision to make and it isn't an easy one, that's for sure. In my opinion, I am sure their attorney will advise them to either continue on and cut their losses or fight for their home back and lose their buyer. The issue at hand though, is the seller isn't truly free to re-list their home with another agent, unless the current agent agrees to this in writing; his fraudulent behavior will ultimately go unpunished because the seller needs to sell and most likely will not want to rock the boat. Or their attorney can call the agent, threaten everything under the Sun, and we can hope that he quietly walks away and goes back under the rock from under which he crawled.

I again want to stress here that although difficult, all I did was listen. I wanted to yell, laugh, cry and mostly just scream I TOLD YOU SO, YOU GET WHAT YOU PAY FOR - but I held my tongue because, although not fair at times, I have to.

If the seller chooses to share more information with me, I will keep you updated on what happens next - I, too, am curious.

But ultimately, there is only ONE winner here - the rest of us lose. The winner is this agent, who signed a contract for $1,700 and ended up making more than 3% - and yes, he obtained his commission fraudulently, but he's in a contract, he is protected by the law - and the home owner is just plain old out of luck!

Don't get me wrong - I know there are "ways" the seller can most likely get out of the listing agreement - but what of the buyer? The seller signed a purchase agreement - even though they do not have a legal listing agreement, accepting the offer is as good as saying you agree - even though they never got a copy of it, signing the purchase contract says they did.

What a mess!

I wish I could blame this on Mercury in Retrograde but I can't.

 *changed to protect identities.............cuz you know who you are!

Having friends and neighbors who've been scammed as well as seeing advertisements ALL over the place for companies offering loan modification, debt consolidation, etc, all noted that their "team of lawyers (please note that the State Bar of CA is asking licensed attorneys NOT to affiliate themselves in any way with these "teams") will be working on the mod.

That said, I have decided to print a top 10 list of warning signs for loan modification scams - and if ANY of these have happened to you, please report the company you are working with to the Better Business Bureau (you can also look up their rating online as well) and CALL the bank yourself or hire a real estate professional or loan officer to help you - there are also organizations who will help you for FREE! I help my clients for free as a courtesy and I will disclose upfront that if the client cannot afford what the bank is offering, my suggestion is a short sale! Now keep in mind that a lot of these companies will only make money if they (1) charge you up front (#1 sign it is a scam) OR (2) sell your home as a short sale - so what is their motivation to help you????? The only thing they want is a short sale - otherwise they work for free! And folks, as we all know - nothing is FREE in this world...........

TOP 10 Warnings are as follows:

1. "Pay us $2,500, and we'll save your home and get you a VERY low monthly payment." Some legitimate housing counselors may charge small fees, but fees that amount to thousands of dollars are likely a sign of potential fraud - especially if they are charged up-front, before the "counselor" has done any work for you. Be VERY cautious of companies that require you to provide a credit card,  cashier's check or wire transfer before they take any action on your behalf.

2. "Sign over your home, and we'll let you stay in it." Be very suspicious of someone who offers to pay your mortgage and rent your home back to you in exchange for transferring title to your home. Signing over the deed to another person gives that person the power to evict you, raise your rent, or sell the house. Although you will no longer own your home, you will still be legally responsible for paying the mortgage on it - all you have done is give the home away - not the financial responsibility for it.

3. "Stop paying your mortgage." Do not trust anyone EVER who tells you to stop making payments to your lender, even if that person says it will be done for you. Think really carefully about this - if you stop making your payments, what typically happens?

4. "If your lender calls, don't talk to them or refer them to us." Your lender should be your first point of contact for negotiating a repayment plan, modification, or short sale. It is vital that you stay in close communication with your lender, so they understand your circumstances - who better than you truly does understand what your circumstances are?

5. "We guarantee we will save your home." Be VERY CAUTIOUS of guarantees that a person or company can stop a foreclosure and allow you to remain in your house. Unrealistic promises are a sign that the person making them will not consider your particular circumstances and are unlikely to provide services that will actually help you.

6. "Your lender never had the legal authority to make a loan." Do not listen to anyone who claims that they know of secret laws that can be used to eliminate your debt and have your mortgage contract declared invalid. These scammers use sham legal arguments to claim that you are not obligated to pay your mortgage. These arguments don't work, they are fraudulent and waste precious time that you may not have!

7. "Just sign this now; we'll fill in the blanks later." NEVER EVER EVER sign a contract without making sure all of the information is filled out and complete and be sure to take the time to read and understand everything you sign. Never let anyone else fill out paperwork for you. NEVER let anyone pressure you into signing anything that you don't agree with or understand.

8. "Call 1-800-Fed-Loan." This may be a scam. Some companies fool the home owner into believing that they are affiliated with the government. Some will also tell you that you must pay them high fees to qualify for government loan modification programs. REMEMBER that you do not have to pay to participate in legitimate government programs. All you need to do is contact your lender to find out if you qualify as there are certain restrictions for loan modifications. As some may have read today, it is not always in the banks best interests to do a loan modification and thus they would prefer to foreclose.

9. "File for bankruptcy and keep your home." Filing bankruptcy MAY temporarily stop foreclosure. If your mortgage payments are not made, the bankruptcy court will allow your lender to foreclose on your home. Be aware that some scammers will file bankruptcy in your name, without your knowledge, to temporarily stop foreclosure and make it seem as though they have negotiated a new payment agreement with your lender. It is a temporary measure that may give you another 3 to 6 months in the home - a home that is no longer yours!

10. "Why haven't you replied to our offer? Do you want to lose your home?" Some companies will use high-pressure tactics which is a red flag. If someone continually contacts you and pressures you to work with them to stop foreclosure, do not work with that person, do not provide them any of your information 0 hang up the phone!  Legitimate counselors do not conduct business in a threatening manner. Be sure to look up the company at the BBB OR any of the scam sites available online.

To save someone else the trouble, please be sure to report ANY suspicious activity to the federal agencies, such as the Federal Trade Commission, and to your state and local consumer protection agencies. Reporting con artists and suspicious schemes helps prevent others from becoming victims.

If you have any questions on the above information or need help with your loan modification or short sale, please call or email me. I'd be more than happy to help - for free!

There are a lot of articles hitting the blogs questioning the ethics of today's challenging market. In my area, we face a housing shortage, esp in some price ranges, and it appears as though many are not listing the homes on the MLS as directed - and as a result are selling the homes themselves. While double-ending a listing is legal in CA, is it ethical? One may think of the multitude of fiduciary duties owed to a seller - whether the seller is a bank or an individual - and challenge just whose interests are being protected.

If a seller hires an agent - again whether it be a corporate listing or an individual - you are charged with the duty to obtain the best price for your customer as well as the best buyer. Can you do this ethically? Can you effectively due your duty? In my experience, the only one who wins is the agent. It seems to be happening more and more where the agents are withholding the listing from the MLS or putting that there are no showings until further notice (typically due to repairs) yet the home pops up as pending/sold either before or on the date the home is advertised as available. Another issue is the agents will post a sign in front of the property yet not put it in the MLS - when a call is made to see when the home will be available for showings, we are given a non-commital reply. Again, the home is NOT in the MLS - but when it is finally listed at some point in the future it is listed as pending/sold...........so the agent is putting it in the MLS as per the rules but tends to sell the home themselves before reaching the market place, effectively, in this agents opinion, of stealing from the seller.

The AM's I work with require me to prove that it is in the MLS for 5 days before they will even look at any of the offers and in my experience, wont pay me both ends if I bring in the buyer - in effect, they are discouraging this from happening. I know there are some who side-step this rule by "referring" the buyer to another agent, thus obtaining a referral fee on top of their half of the commission. Legal? Yes! Ethical? That's up to you to decide............

I could go on and on due to the fact that I have cultivated relationships with both buyers and sellers who wish to purchase/sell in this market. However, I refuse to be dragged into the quagmire of greed.

Another month of ups and downs in the real estate world! What is going on? Interestingly enough, we do actually have a really good housing market here in Ventura County and I will tell you more about why I say this and why I feel this way.

 According to what I have seen or experienced as well as articles I found online housing prices are climbing, albeit only by 1 and 2 percent in most areas, but some of the states ( are seeing prices increase by more than 10 - and in some cases, more than 14%! What? Wait a minute? Haven't we been hearing about our declining market? Huh? Sorry, I agree that there is no need for sarcasm, but I am sure you can understand my frustration! We are not talking about a car you are purchasing, it is a HOME! This is the largest, most important financial transaction you will EVER make - and yet some obscure writer has managed to create such a ruckus over our housing market!? Who are these people who write these articles? Where are they living? Do they have crystal balls? If so, I want one!

As you are aware, our government is working on programs to help those facing foreclosure or those whose mortgages adjusted, in order to lessen the number of foreclosures hitting the marketplace and most importantly, enable those whose loans have adjusted to keep their piece of the American dream. If this program comes to fruition - and they can manage to make it work for Californians - the foreclosures will end or slow down significantly, the huge price drops will cease, with the exception of those who are totally over-priced to begin with, and short pays will once again be a thing of the past! In fact, personally, I'd say we are already experiencing this!

If you look at current lists of homes with a notice of default filed (pre-foreclosures) you will see how short that list actually is - down from 20 pages to single digits - and it is continuing to decline. Banks are helping - in fact, without even asking, our bank sent us a letter and offered us an amazing refinance - FREE! Banks who used to turn down short pay offers are now accepting them - and buyers have come out of the woodwork - swinging - with CASH!

Just this week - I showed two homes - two different cities - two very different price ranges - and both have offers upwards of 10 on each! Most are cash buyers as well. One of the homes is well over a million - and people still think there is an on-going decline here? Not so - not any longer unfortunately.

In the real estate industry we have a term for buyers who wont buy - fence sitters. Guess what? You may have sat just a little too long - cuz homes are selling so swiftly, even I am stunned! Me, who has been a HUGE proponent of BUY NOW BEFORE IT'S TOO LATE! If you are waiting for bottom - it's been and gone.

Values are still expected to remain at these all-time lows - but not for much longer if this week was any indication of where the housing market is expected to go.

As of March 21st, the FHA made it a little harder to qualify for a loan, raising the credit score minimum from 580 to 621; this caught some buyers' unaware although the FHA made an announcement close to a year ago that this was going to happen. So, the ideal in this situation is to review your credit report and see what you can do to increase your score. In the case of one client of mine, it was paying down about $300 on one credit card - and they are now safely over the 621 score! Whew!

Personally I believe we are once again experiencing a SELLER'S MARKET - yep, you read that right - a seller's market! How else do you explain the average well-priced home or foreclosure having multiple offers? It is a feeding-frenzy out there on some of these homes! Even the reviled short sales have tons of offers - how can it not be a seller's market? In a lot of cases, I am hearing about buyers writing offers on multiple homes to ensure they get one of them. How crazy is that? Totally reminiscent of 2005!

Anyway, the point I am trying to make is this; thinking of buying?  Get pre-qualified with a reputable loan officer or bank. Once you have done that, start looking - and plan on it taking a few months - the inventory is low in my area and there are so many buyers that competition is stiff. Hurry before the prices go up again!

Now if you are an investor - be wary of others jacking up the prices on homes for fun and games and then walking away - I am seeing it happen and the seller is then losing their other potential buyers! All need to be wary - all markets have their crack pots and this market is no exception!  

All of the above are my opinions; I find myself to be one of those Realtors who study the market, as well as study the trends; I read everything I can get my hands on, and honestly, I just love what I do!

 

Bottom line? You love the home and can qualify AND afford the loan? BUY IT!

 

I know a lot of buyers may beg to differ, but honestly, there are so many good deals out there, I am personally frothing at the mouth - okay, that's a little gross - but seriously, I have to pass on those great buys day after day after day - due to the same reasons buyers today are struggling - affordability!

However, the media reports of homes in CA now reaching an all-time high of affordability are actually true! In Thousand Oaks - and surrounding communities - we are seeing homes priced - and selling - for 2003 prices! Whodathunkit?? Not me, that's for sure!

However, short sales and foreclosures have essentially set a new price for our market - and it is a great place to be - if you are a buyer of course!

So, how do we capture these steals? Well, that's the tough, million dollar question. There is a ton of competition - a lot of people pulled their cash out of the stock market - and are now investing it in the best possible place - the real estate market! Where else can you earn approx. 6% a year at minimum? Most banks arent certainly offering that type of an ROI!

Now we know that most of the buyers today tend to be investors - you as a buyer are competing with an all cash buyer who doesnt tend to care about the carpet and paint; they will sink a few grand into the home, stick a tenant in for a year and make a great deal of money the next time around - which a lot of those financial wizards are predicting will happen by the end of this year or very early in 2010.

What can I do you ask? Well, first, having an agent who knows the market is just one part of it; having an agent who lives in the area is also essential. Okay, so your neighbor, your brother in law's cousin, etc, are all agents - you have lots of advice coming at you, right?

The key is simple- you need to look at the home and see the value in it at the listing price - or in most cases lately, 10 or 15k higher than the listing price. I also supply my clients with comparables from different time periods - 2001 through 2003 as well as 2004 through 2006 - you as a buyer need to see where the homes value was, where it went and I then help you calculate the math at where it will go. Once you see this, you can then determine what the right price is for you. I can guide you of course, but ultimately, you are the one writing the check each month, and sending it to the bank, not me.

Another important factor is to get your pre-approval from a well known financial institution or loan officer in writing. Make sure they have reviewed your credit, your income, assets as well as sourced all of the money you have; too many times - even in this market which is maddening - loan officers dont want to take the time to fully review a buyer - and you find out while you are in escrow and could loose your deposit, that your loan officer didnt quite do all of his/her homework. That's very frustrating - don't worry I have some amazing loan brokers I can refer to you - and it slows down the entire process.

It is extremely important to know - prior to going out and even looking - what you are qualified for! If you have credit issues, let's figure out what those are NOW - not when you are under a contract. Keep in mind as well that if you are looking to purchase a home at $350k, you can purchase using FHA or Conventionall - rates fluxuate on both - and the costs also differ greatly - you put down either 3.5% for FHA or 5% for Conventional - but the credit score requirements are very different. If you are being gifted funds, we need to know - via a letter - where they are coming from and so much more! Bottom line? Get your ducks in a row - FIRST - so that you dont have your dream home taken back from you!

Again, there is so much advice I would love to share with you; please feel free to call or email, anytime! And don't forget - I also assist with loan modifications and short sales - there is hope! If you know of anyone in distress, please have them call or email me.

Best,

Suzanne Grace

That's not an easy question to answer! However, as an experienced agent - specializing in negotiating - and CLOSING - short sales, as well as bank owned homes, I have the knowledge and the tools available to me to successful help today's distressed home owner!

I am not asking to strictly list - and sell - your home. If you want to stay in your home, yet you cannot afford the payments any longer, allow me to help! I take my job as a realtor very seriously - and it's not just about selling homes! I am very experienced in helping home owners work out loan modifications with the bank and I am more than happy to help you.

As far as I am concerned, selling your home as a short sale is a last resort. If you are a seller or an agent with a short sale you have no interest in working on, please call or email me; I truly want to help - and truly care! There are answers out there - and I would love the opportunity to assist you!

Best!

Suzanne Grace 

As you may be aware, on Wednesday President Bush signed the Stimulus Bill; besides the tax benefit of this bill, there is also the portion that is designed to jump-start the housing market as well as ward off a recession.

For our area (Ventura and Los Angeles Counties) we were granted the maximum for the conforming loan limit of $729,750, which allows consumers to purchase more home without the rates typically associated with a jumbo loan. However, there are still quite a few details that need to be ironed out, such as how to find the median price. This increase applies only to loans originated between July 2007 and December 2008, but there is a possibility that it could be extended.

Wall Street is still working out whether investors will want to bundle securitized loans above $417,000 with loans below that level or if they will invest in them separately. Rates for these loans may be higher due to the fact that banks may fear that the larger loans are riskier but they are more than likely going to be lower than the current jumbo loans (what would be the point of this if they weren't?). While the proposal does not apply to loans made before July 2007, borrowers with old mortgages can refinance into new loans that would then be sold to Frannie and Freddie, as these would then be considered new loans.

One thing to keep in mind is the value of your home today versus what you currently owe; while the Stimulus package is fantastic and will continue to assist in stabilizing the market, for those who owe more than their home is worth, it doesn't have any impact at all (however, see below regarding the "Project Lifeline" initiative unveiled this week) and some may find themselves in the same position. There are many who purchased in 2005 and 2006, and did so without putting any money down and thus now find themselves in the position of owing more than the current market value.

Project Lifeline - Stalling the Foreclosure Process?

Many buyers today are waiting for foreclosures to come on the market in order to get a "deal". However, with the new Project Lifeline initiative that was unveiled this week (6 mortgage lenders are participating), that wait may just have gotten a little longer. Under this new initiative, banks will "freeze" the foreclosure process for 30 days in order to help the homeowner work out alternatives. The program is targeting homeowners who are 90 or more days late on payments; they will receive a letter offering a "pause" in the foreclosure process to try to work out a repayment schedule. In the past, those who are delinquent have always had the option of calling their lender for help but the foreclosure process continued during these talks; however, under this plan, there will be a 30-day freeze in the process. Unlike the government-endorsed rescue effort announced last year, this new program is not just limited to subprime mortgage (loans given to those with weak credit), but it now also includes foreclosures triggered by home-equity loans, prime loans and second liens. Of course, modifications to loans are made on a case-by-case basis and not all eligible loans are expected to be salvageable. Homeowners in bankruptcy will not be eligible for the program, which also excludes vacant and investment properties. The offer also doesn't apply to those whose homes are scheduled for foreclosure sale within 30 days.

The program also won't help borrowers who put down little or no money and who don't want to continue to live in the house.

Countrywide Financial, Bank of America, Citigroup, J.P. Morgan Chase, Washington Mutual and Wells Fargo are participating in Project Lifeline. They are also members of the Hope Now Alliance, the industry-financed nonprofit group that has been coordinating efforts to reach struggling subprime mortgage borrowers.  

Critics say that the plan will probably assist only a small percentage of the estimated 425,000 homeowners who are 90 days or more delinquent on their loans. These homeowners are already under stress, and lenders would have to be willing to make significant changes, including reducing mortgage balances substantially in order for this program to be of any help. The mortgage industry has been fighting the perception that it is not doing enough to help troubled homeowners, pointing out that the number of loans modified, including freezing and lowering interest rates, has doubled in the past year. During the fourth quarter of last year, lenders modified 141,000 loans, up from 76,000 in the previous three months, according to the Hope Now Alliance. (Keep in mind that these numbers are nationwide and not for Ventura or LA Counties)

Those numbers are likely to increase as lenders implement the program announced last year to freeze the interest rates of qualified subprime borrowers, industry officials said yesterday.

More Industry News

Beginning this week and continuing through September, HUD's Federal Housing Administration (FHA) is mailing 850,000  letters to at-risk borrowers who have already faced or are experiencing the first reset of their adjustable rate mortgages, and live within geographic locations that are currently subject to FHA loan limits nationwide. If this has the intended effect of keeping those at risk out of foreclosure, it could help shore up the housing market and the state's economy.

It is more important than ever for potential home buyers to have a good credit score. Consumers should obtain a credit report and take care of any outstanding issues that can be fixed or improved prior to applying for a loan. According to a recent Federal Reserve survey, some 53% of lenders tightened requirements for prime-quality borrowers, 72% for subprime borrowers, and 85% for non-traditional mortgage borrowers, including PayOption ARMs, loans with interest-only payment structures, and other such products.

Whether or not they have children, consumers may want to consider a home in a neighborhood with excellent schools. Homes in good school districts typically are a bit more "recession proof" and appreciate faster than homes near weaker schools, according to MSN Money. Both the Conejo Unified as well as the Las Virgenes School Districts have the highest API scores in the nation! This is why our communities have not seen the dip in prices that most other areas have seen and is another reason why we are seeing properties selling with multiple offers once again.

Rates on 30-year mortgages dipped slightly last week, the fifth decline in the past six weeks. Fixed-rate mortgages averaged 5.67 percent last week, down from 5.68 percent the week before.

For more information on the programs discussed in this article and for current rates, I have been referring my clients to Francesco Foggia at CS Financial; he can be reached 24/7 on his cell phone 310-922-3363 or via email FFoggia@CSFinancial.com. Please feel free to visit http://www.thousandoaksdreamhomes.com/ for more information on our lending partner and the programs he has been designing for those who are in the process of refinancing or purchasing a new home. Based on the volume at CS Financial, you can be guaranteed a rate that is extremely competitive with programs to meet your every need.

Please feel free to call or email me as well; 805-341-4644 or csgrace@verizon.net. I, too, am here to help in any way that I can. Keep in mind that I offer a free Market Analysis for your home and this will let us know where you stand in today's market; if you are not in the market to buy or sell, remember to pass our information along to your friends and family who are - the highest compliment you can pay is to refer us and we thank you in advance for your trust and faith in our abilities!  

*the information and opinions in this article are the opinions of Suzanne Grace only and in no way imply that Prudential agents/brokers are of the same. Information was given as interpreted by Suzanne Grace and any errors are her own and in no way is this information intended to be misconstrued as advice and all buyers and sellers today should seek legal counsel if considering foreclosure and/or short sale options.

Another month of ups and downs in the real estate world! Unbelievably, an article was printed on the front page of the NY Times last weekend, accusing the Nation's largest lender of fraud, and now this weekend it is about the unemployment rates that are expected to skyrocket, due to the housing market decline and so on. What is going on? Interestingly enough, we do actually have a really good housing market here in Ventura County and I will tell you more about why I say this and why I feel this way.

 

According to what I have seen or experienced as well as articles I found online (MSNBC.com was one source of some great information) housing prices are climbing, albeit only by 1 and 2 percent in most areas, but some of the states (Utah, Colorado and Nevada to name a few) are seeing prices increase by more than 10 - and in some cases, more than 14%! What? Wait a minute? Haven't we been hearing about our declining market? Huh? Sorry, I agree that there is no need for sarcasm, but I am sure you can understand my frustration! We are not talking about a car you are purchasing, it is a HOME! This is the largest, most important financial transaction you will EVER make - and yet some obscure writer has managed to create such a ruckus over our housing market!? Who are these people who write these articles? Where are they living? Do they have crystal balls? If so, I want one!

 

As we speak President Bush and Congress are working on a program now to help those facing foreclosure or those whose mortgages adjusted, in order to lessen the number of foreclosures hitting the marketplace and most importantly, enable those whose loans have adjusted to keep their piece of the American dream. If this program comes to fruition - and they can manage to make it work for Californians - the foreclosures will end or slow down significantly, the huge price drops will cease, with the exception of those who are totally over-priced to begin with, and short pays will once again be a thing of the past!

 

Bush's proposals unveiled this past Friday are designed to help combat those in default. It would make it easier for borrowers now holding adjustable rate mortgages that are resetting to higher monthly payments to refinance those loans using the resources of the Federal Housing Administration (FHA). The FHA is a Depression-era agency created to help low and moderate-income Americans afford homes.

 

Under the Bush proposal, which FHA officials said would take effect immediately, an estimated 60,000 homeowners who have fallen behind on payments because their mortgages have reset, would be able to refinance with FHA-insured loans. That marks a significant change because FHA does not now insure refinanced loans from borrowers who are currently delinquent. To qualify for the new program, being called FHA Secure, a borrower will have to prove the original loan was being repaid until it reset to a higher rate and they must have 3 percent equity in the home. The FHA does not supply the mortgage loan but it guarantees loans extended by banks and other lenders.

 

Federal Reserve Chairman Ben Bernanke has also pledged to do everything necessary to bring our housing market the stability it so desperately needs; with that comment, one can only assume that the interest rates will go back down. Hopefully, sellers will realize that while this will help curb the slowing market, it does not mean housing prices can go back to skyrocketing numbers; it simply means you can sell your home for the price that the market can carry - basically, a home is worth what a seller will sell if for - and what a buyer will pay for it. And let's not forget what the appraiser will appraise it for!

 

Let me be real here for a moment; none of us want to see what has been going on over the last few years where people are paying whatever they have to in order to get into a home. 99% of the foreclosures I have come across are from people who had no business buying in the first place! With than said, I am certain that the NEW lending regulations will stay tight and in place no matter if the market adjustment works in the buyers favor - i.e., interest rate decrease; a HUGE lesson was learned over the last 12 to 18 months - and that lesson is do not sell a home to someone just because they want one - make sure they can actually afford it and that they are qualified to purchase it!

 

In my opinion, I feel that a lot of the responsibility for our current market rests on the mortgage brokers (brokers are those who broker loans to different banks, not loan officers who work for only one financial institution) who sold these loans to the banks, in a lot of cases, borrowers were allowed to stretch the truth using stated income!  From what I know, 90% of the loans that Countrywide owns, for example, were sold to the buyer from an independent source, not an internal Countrywide loan officer, OR Countrywide purchased the loan in the secondary market. I have seen with my own eyes individuals who have purchased homes who had no means in which to pay for them! How can that be? How can the mortgage brokers get away with that, and get paid for doing it - and yet who is TRULY paying for it now? YOU and I are! We are the ones who now have to deal with price adjustments, higher interest rates as well as the exorbitant cost of money!

 

The bottom line is this: in our lovely communities - Agoura Hills, Calabasas, Moorpark, Newbury Park, Oak Park, Simi Valley, Thousand Oaks, Westlake Village, as well as Northern Ventura County as well as Northern LA County - we DO have a great market! We have great weather (okay, the 110 in Calabasas today wasn't so great, but you know what I mean!), excellent schools, near to beaches and LA proper, excellent sources of industry, friendly communities, amazing health care (doctors, hospitals) available, as well as great sources of entertainment - and people want to live here! I know I meet AT MINIMUM 10 to 20 individuals and families per week looking to move from the city or outside of our state, into our area!  This is great news for both buyers and sellers as we all want to know that one day our homes will sell.

 

Think of it this way:  if you are buying a home to live in for the next 5 years - or more - if you are paying $600,000 (or more or less, it doesn't matter for this writers opinion), honestly, what is the difference if you pay $25,000 or $50,000 more today than you could next week, next month or next year, when our market is cyclical - and no matter what, your home's value will rise (and maybe fall!) in the next 5 years! I am by no means suggesting that anyone EVER overpay for a home! However, if the home you are considering purchasing appears to be a good value, you like it - love it even - and can happily live in it for the next 5 years or more - what good is it to wait? All that is happening to you by waiting is that the lending market is getting tighter, it is harder to get a loan, it is certainly more costly, notwithstanding the interest rate increases! So by waiting for prices to (MAYBE) drop, by listening to the media fodder about housing prices falling like crazy (not here they aren't) all you have done is cost yourself more money in closing costs as well as a higher monthly payment, due to the interest rate hikes. And that's if you can even afford a loan or obtain one with today's stringent underwriting guidelines. So you want to save $100 or $200 per month? (again that's assuming prices DO drop another $25,000 or $50,000) -- Guess what? You might cost yourself more than that due to the increased interest rates or the guideline changes that force you to put more money down than you had planned on!

 

All of the above are my opinions; I find myself to be one of those Realtors who study the market, as well as study the trends; I read everything I can get my hands on, and honestly, I just love what I do!

 

Bottom line? You love the home and can qualify AND afford the loan? BUY IT!

 

 

Though blogging isn't my typical forum for writing about the state of our real estate market, since I also send monthly newsletters, I figured the more I can get my word out there, the better educated my potential buyers and sellers will be - and this enables me to work with you on a much more realistic level - your expectations for what you can get for your home aren't way out there, and as a buyer you will understand what the current market looks like - and you can spend accordingly and feel good about it!

I offer a few really amazing tools on my website; one is the market snap shot tool. If you visit http://www.thousandoaksdreamhomes.com/ and click on the market snap shot link, it will take you to a SHORT FORM that asks for a little bit of information you will need to enter, such as your criteria, and by doing this you are essentially subscribing to the market report for your specific zip code (buyer) or address (seller). I have to say that this report puts all other information available (such as the always inaccurate Zillow) to shame.

My website itself is also a tool, in that it provides tons of information necessary for first time buyers to understand the process, reminders and updates for buyers making their 2nd and 3rd trips down buyer's lane, tips for sellers on selling their home as well as posting current homes available throughout Ventura and Northern LA Counties.

The market in the Conejo Valley for the most part is stable; while we have been hit with foreclosures and short pays, it is not at all like the other cities throughout the state (or the nation) as we are insulated from what affects others - lack of employment, bad schools, gang activity, proximity to major cities, beaches, etc. We do have a few amazing companies here such as Amgen, Blue Cross, Dole, Baxter to name just a few, and while everyone has heard about the Amgen lay-offs, in my opinion, this is a temporary blip and will correct itself in time - as we all know they are an amazing company and their support of Thousand Oaks and surrounding areas has been immeasurable.Besides the local businesses and industry, we also have excellent, top rated schools throughout our community.

Oak Park, for example,  has experienced, overall, an increase in home prices since 2005 - not the decrease other areas are experiencing. I believe that this is due to the school system and people who can afford to, will pay whatever it takes to be able to live there. Agoura also has an amazing school system and I have not seen a decrease in prices there either - again, overall - and as with
Oak Park, since 2005, we have also experienced a slight increase!Other areas, however, have not been quite as lucky, such as Dos Vientos and Wood Ranch/Long Canyon; to be perfectly honest, I am not sure why this is happening in these lovely, newer communities! Dos Vientos has long been the type of community boasting the highest prices and the fewest homes on the market but that all has changed in 2007. With the sales experiences I have had in Dos Vientos this year, divorce seems to be the primary reason for selling; one can also assume that the divorce was due to financial stress - lay-offs, etc - and thus we are seeing a larger number of homes for sale.

I have not seen the same pattern in Wood Ranch, however, and am truly at a loss for why homes that are priced well below market are not selling. Well, that is not exactly true; I do have a feeling of what is going on and that is that the interest rate increase, as well as the decline of the secondary market - and get this, now BofA and others are doing away with stated income loans - is truly what is having the biggest impact of all - well, now that I think about it - the media doesn't help either, with their biased opinions of what is going on in the real estate world, comparing CA to other depressed areas, and spreading their scare tactics across the nation! One would assume that these so-called journalists may also own a home and have a financial stake in the real estate market as well and rather than cause paranoia among homeowners and buyers alike, maybe instead they should be pointing out the benefits of owning a home, the fact that there are ways to get a lower interest rate and most of all - point out that we do - at least here - still have a very strong market!  

But I digress - as usual! To back up a minute to the interest rate increases and the HUGE changes in the lending world and its overall effect on the market - traditionally, rate increases will bring prices down a bit - however, when you think about it, your payment is essentially the same. I do have clients who have expressed a desire to wait to buy until the rates jumped up - and subsequently, bring housing prices down. However, as I always point out, the end result is the same - and now some who chose to wait no longer have available to them the loan they originally qualified for, due to the banks tightening up (and who can blame them?). The flip side is that we all know that the rates will eventually come back down - and you can always re-finance into a better loan - if the cost of doing this makes sense of course. So much to think about! The bottom line is this: I continuously educate myself; I study the market and its trends, in order to better help you determine whether or not this is the right time for you to buy or sell. Let's face it folks - people want to live in our lovely community and we all know why since we came here for the same reasons people are still coming. Because of this, sellers will ALWAYS sell, buyers will ALWAYS buy and with exception to the few bleeps in the system, it will remain status quo!

FOR MORE INFORMATION you can visit my website: http://www.thousandoaksdreamhomes.com/, respond to this post, send me an email csgrace@verizon.net or call my cell or office directly (805-418-3253).