DC & the Maryland Burbs Real Estate Blog

Why Short Sales Don't Sell........No Suprises !

2008-06-20T12:00:04Z

Those dollars down the drain represent the hours wasted. Who wasted them? Hmmm, how do you waste them? Let me count the ways.........

Begin with the hours a new home buyer spends in front of the computer screen perusing all the homes for sale in their price range (we won't count the productivity lost when searching at work).
Then there are the hours the new home buyer spends on weekends, driving around stopping at open houses.
Next, you have to toss in the hours the new home buyer spends doing research on which agent to use in their search.
Now, the cost of the hours begins to increase. After all, the agent is doing this for a living and even if they don't realize it, their time spent is money spent.
The next batch of hours lost are spent visiting properties that may or may not be available. Under our current rules.....it has become a "crap shoot".
These are followed by the painful hours. You know, those hours it takes to prepare an offer, followed by the hours it takes to receive a response. You can even add a bunch of minutes for the time you wait for the agent to even return a phone call.
The come the hours of death. All the time spent has been for naught.

The home was not really for sale. It was in the MLS. It did have a list price. It did say pending 3rd party approval. It did have a sign in the yard. I did have a lockbox on the door. I did have a fancy sell sheet on the table. The home was not really for sale.

The following is an example. This is not t.v. and this is not a fictional account. Names remain the same. I make no judgement on the innocence of anyone. It just is a sample of why short sales don't sell.

A very good friend of mine called and asked if I would consider taking a young couple out to find a home. She prefaced the information with "they don't have a lot to spend, but they are a very nice couple." I told her absolutely, send me the information and I will do what I can to help them.

I chatted with the wife and she said they could meet me at the property that evening. I drove to Brunswick and showed them a home. Now, now....before we walked through the door, I explained agency relationships and the other information required by the State of Maryland. They liked the home, but said that the location was just a bit farther than they would like. They explained that they would like to find a home soon, but they are not under any time constraints. I told them I would do some searches for them.

I went back to the office and did the usual MLS, Craigs List, FSBO.com searches. I checked the on line classifieds and came up with a group of homes that were in Frederick. I sent them the information. They wrote back with a list culled from list that they wanted to see.

I made the proper arrangements and we met a second time and went on tour. The first house we visited was missing a refrigerator, toilet and upstairs window. I rechecked the listing and the agent had shared "great shape, bank owned." Apparently, the bank did not own a refrigerator, toilet or upstairs window. We moved on to the next home. Our third stop was very brief. The owner (yet another in a short sale status) shared that "they did not give a rat's xxx what the agent told us, they were not allowing people to see the home except on weekends". They slammed the door in our face. (I made a mental note to make sure and call the agent and let them know how much my clients appreciated that treatment. My buyers did not want to reschedule for the weekend or any other day.)

At the end of the evening, they had found the home they wanted to buy! It was a nice little townhouse at 121 Lauren Court, Frederick, MD 21703. It was listed by Homestar Realty located at 8120 Woodmont Ave, Bethesda, MD 20814. The listing agent was Marjorie Perez-Martinez.

The list price in the multiple listing service was $141,000. The AGENT REMARKS : Gorgeous townhouse in perfect location. Hardwood floors in main level, ceramic tile in all baths, huge closets, stone patio with fenced rear, storage shed and much more...PRICE TO SELL..A MUST SEE... This is a Short Sale subject to bank approval. As is condition.

The compensation was listed as 3%.

Now, other than the fact that it was apparent that the agent did not know the difference between hardwood floors and cheap pergo knock offs, I believed that the information provided was correct.

My clients had financing in place and came in to sign an offer. I won't bore you with too many facts. Using my expertise and knowledge, I suggested that they offer $148,000 with $6,500 in closing help. I was aware that there was another offer and we would be in a competitive bid situation.

My clients signed the offer. I submitted the offer and we began our wait. After about 36 hours of calling and leaving a message with the other agent (trying to ascertain if 1. the offer had been received and 2. had the offer been submitted to the bank.), we were told that the offer had been sent to ..................drum roll, eye roll, belly roll, roll the dice, roll over and play dead..........Countrywide.

Bright and early on day 4 we received a note from the listing agent. Countrywide had sent my clients a counter offer. THIS IS NOT A MISPRINT. Countrywide's counter offer was $158,000 with 2% seller help and a reduction in the commission to 2%.

I called the other agent. I asked..."Let me understand this. My clients offered your client a contract that would net them $1,500 more on the price and they have responded that they want $17,000 more in price and are willing to offer $3,160 in seller concessions?"

The other agent asked if my clients wanted to counter.

"NO, the offer submitted is their best and final offer. Tell Countrywide take it or leave it."

We are still waiting.

Oh, why short sales don't sell? Maybe it's just my opinion, well, it is my opinion, bait and switch stopped working when vacuum cleaner salesmen stopped going door to door. There is no policy preventing broker's from listing a property well below what they know or should know would be acceptable to the bank. There is no ethical requirement for those zealously seeking to reap the rewards of people struggling.

I realize that I share the same profession with the other broker and the listing agent. Fortunately, I do not have to ever share the same room with them.

My clients, well, it is a setback, but I will find them a new home.

Lost in translation.......we hardly noticed..........

2008-06-02T11:20:18Z

There will be no pictures here. I ask that you allow your imagination free reign to picture the following as you see it in your minds eye.

Once upon a time there was a little town. 200 people lived there. Their water supply came from wells that were dug near their homes. Those that did not have the funds to dig a well, used the large community well in the center of town. Years passed and everyone had potable water. For one reason or another, the wells began to run dry. They still produced water, but the volumn was diminished. Town meetings were held and it was decided that they should build a series of pipes from a distant river to a water tower they would construct.

The water tower concept was accepted. After more discussion, it was determined that building the water tower would take a professional water tower builder. Requests were sent out to water tower builders across the land. Experts were needed.

Soon, the elected town officials began to hear from water tower builders. Experts came to town to go over the project. The experts began to suggest that the water tower concept was not complete. In order to guarantee the potability of the water, the town would also need a filtration system.

The conversation turned from the need for water to the quality of the water needed. The focus of the community was directed away from the need to clean and quench thirst to the actual composition of the water that would be available.

The competing experts began to form allegiances with the various elected officials. The townspeople hardly noticed that the elected officials were enjoying paid vacations. The townspeople hardly noticed that the quality of life of the elected officials was becoming much more comfortable. The townspeople hardly noticed that the longer it was taking to make a final decision on which expert would be hired, the difference in the quality of their life and the apparent quality of life of the elected officials seemed to grown larger.

Time passed and wells continued to decrease in production.

During this time, the population of the little town continued to grow, increasing the strain on the water reservoir running beneath the town. Scientists were contacted and they confirmed that there is only so much water in the aquifer and the current depletion of that supply was growing exponentially.

The townspeople began to demand a resolution from their elected officials. As new elections were scheduled, candidates promoting a swift resolution to the problem surfaced. The townspeople hardly noticed that the campaigns for the candidates were being funded by the experts that claimed to have the solution.

Elections were held and as fate would have it, the candidates supported by the richest of experts won handily. The townspeople hardly noticed. It is the unspoken secret of elections that the person that spends the most to win, usually wins.

The newly elected officials once again met to address the problem. As luck would have it, the largest contributers just happened to win the bid. The townspeople hardly noticed. The experts plan was to build a water tower. Their plan was to build a series of pipes from the water tower to each home. Their plan was to build a filtration plant. Their plan was to build a pump station from the filtration plant to the water tower. Their plan was to build a damn on the river. Their plan was to build a pumping station on the dam. Their plan was to build a large pipeline from the pumping station on the dam to the filtration plant.

The project would take five years. The scientist came to town and told the townspeople that based on current demand, the aquifer under the town would run dry in seven and one half years.

The project was begun. The elected officials instituted conservation laws that restricted water usage to cleaning and cooking. The large town well had a tariff added to it. Townspeople that did not have their own well had no choice but to pay the tariff. This immediately reduced their standard of living because the expense of purchasing the community water had to be funded with their stagnant income.

There was a long term cost associated with the project. Townspeople had agreed to fund the project out of tax revenue and they were faced with a small cost annually to offset the cost of the capitol improvement. They hardly noticed that there was no maximum it would cost.

As time passed, this forward thinking community attracted more residents. The strain on the water supply was increased. Scientist warned that the stress on the aquifer would result in dry wells long before the project would be complete.

The elected officials confered with the experts and found that the project could be completed earlier, but at an increased cost. The elected officials decided that they would run a community service information campaign supporting increasing the cost to resolve the crisis. The campaign would generously be funded by the experts. The townspeople hardly noticed.

The project was completed.

The river ran dry.

There was always a limit to the flow of the river. There was always a chance that the chosen supply source would not be there forever. The townspeople heard the warnings. They hardly noticed.

If water were oil, would anyone notice? If we are using more oil daily than we produce daily, does anyone realize the implications that eventually, we will have no oil? Does anyone really believe that the answer is building more highways? Does anyone really believe that after 30 years of concrete warning and nothing truly changing except increased consumption, a solution is at hand? Does it seem odd that the people sharing positive views are large oil firms and auto manufacturing firms and construction firms that build our highways? It is a sad day on the planet. This is not America's problem. This is a global problem.

Current comfort and convenience is being served at the expense of long term survival and life style.

It is inevitable..............the well will run dry. Will we sit, pedestrian, and look back to realize we hardly noticed?

Wake up Marty...It is time to stop the ICC !

2008-05-29T13:08:24Z

"The future is now"; George Allen uttered those words when he took over the helm with the Washington Redskins. Let me preface this entry with the absolute truth. I am not a engineer, highway planner, social scientist or confirmed "tree hugger". I hope Govenor Marty can step aside from his lock step with yesterday and think about this project.

I am but one man. I have thought about this and feel that we are in danger of continuing on a tragic path. The website for the proposed and approved road system states "The Inter-County Connector (ICC) will link existing and proposed development areas between the I-270/I-370 and I-95/US 1 corridors within central and eastern Montgomery County and northwestern Prince George's County with a state-of-the-art, multi-modal east-west highway that limits access and accommodates the movement of passengers and goods."

This supposition is based on the yesterday concept that automobiles and trucks are the best mode of movement for passengers and goods. These projections were founded in an environment that included gasoline at less than one dollar per gallon. The idea for the cross county connector made a lot of sense when no one considered that oil was not a limited fuel source. I don't think many people understand that there is a limited supply of oil.

When the idea for the inter-county connector was first raised, Gaithersburg was a small agricultural town. King Farm was a farm. Burtonsville was a small crossroad. Laurel was a big city. Public transportation was used by a larger percentage of people to travel longer distances. It is a brave new world today and China and India have changed the fossil fuel consumption equation drastically.

Oil companies became more powerful. Road and paving contractors became more powerful. The influence of the dollar became more powerful. Special interests became more powerful. The interest of society and the people living in the area no longer were the prime concern for legislators.

This area is very close to the national arena. Our news and focus seems to fall on national issues. We, as a people, do not see what is occuring before our eyes.

The people that raised objections to the ICC were considered fringe elements. The 90 year old man that did not want to sell his house. Community leaders that did not want the highway in their area. Environmentalist that found every rare fish, frog , flora or fauna in jeapordy. They all spoke out and no one paid them any mind. The issue that was not raised was clearly...what about tomorrow and beyond?

No one stopped to think about 2020, 2030, 2040 and beyond. Charts were offered regarding traffic and flow and bridges and abutments. No one realized that our vision of tomorrow might have to include....no automobiles, no trucks, no buses.

Rail is rather efficient. A light rail system from here to there could accomplish the same goal. Of course, it would have to feed a central point that would be a public transportation hub. It would mean that less people might be on the road. It might even mean the cost of gas would go up more (nasty side light of decreased demand with fixed costs). I can not imagine oil companies using gasoline as a loss leader.

If Governer O'Malley does not have the cajones courage to step up and build for tomorrow, well maybe he could restrict his concrete legacy to buses and trucks.

It really is time to build the world we will live in rather than yet another monument to the world that used to be. I hate being the lonely guy in the crowd.

Why build a highway if no one can afford to use it?

Backdraught.............Realtors are dumb too!!!

2008-05-26T19:10:16Z

Ouch!!!!!!

It is memorial day............John buys brand new charcoal grill..........John takes requisite 4 hours to assemble the "easy assemble" grill.............instructions call for "seasoning".........hmmm...use brush and coat insides with vegtable oil................start fire............seems to be burning slow........instructions indicate put more charcoal in fire.............John does..........they just lay there.........I have it!...squirt some of that charcoal lighter on the briquets..........nothing...........let me open the door and check.....hmmm ...just smoldering..............let me use my lighter........

BACKDRAUGHT.................WHAT THE HELL HAPPENED!!!!!!!!!..........WHERE IS THE HAIR THAT USED TO BE ON MY RIGHT ARM................WHEN DID I TURN PINK.........OWWWWWWWWW!?!?!?!?!?!?

I won't be posting much more. This is my best one handed work.

Be careful what you grill...............it may be you.

Update: It seems that the situation was a bit more untenable than I realized. Once I stopped soaking my body parts in ice water, blisters began to appear and the numbness was not related to the ice. I was directed to the emergency room and after a short exam I was advised that my now blackened fingers had suffered 2nd degree burns. Today I have to visit a specialist of some sort. I do not think that hamburgers will ever hold the same appeal.

Let me experience be a lesson for you. There is a reason God created home delivery.

Didn’t your Mother tell you not to go out without protection?

2008-05-23T12:07:07Z

Didn't your Mother tell you not to go out without protection?

When representation is at no cost to you, why would you look for a home in an unprotected (unrepresented) fashion? Did you forget?....Mother always knows best!

Visit us

www.themacarthurgroup.com

John MacArthur

Realtor / Buyer's Agent

Long and Foster Realtors

Olney/Brookeville Maryland

(O) 301-924-7620 (D) 301-537-4377

The hidden cost of bad advice ......

2008-05-01T23:32:25Z

So the usual suspects were enjoy a little glass of wine after work. Conversation went from the plight of losing a listing to the horrors of dealing with short sales. Eventually, the "forbidden fruit" of commission was discussed.

One agent lamented that co-op commission being offered is not always 3%. She could not believe that agents were only offering 2.5% and in some cases......2%. She felt that in this "market" it was very poor judgement to offer anything less than 3%. She went on to share that, if you really want your listing to be shown..you should offer a bonus on top of the co-op!

"So", I asked, "you think that the co-op offered is an integral part of your home search for clients? And, you think that you should receive a bonus for doing your job?"

She replied "Absolutely!, if you take the information given and it is 2+ bedrooms and 2+ bathrooms for under $400,000 in Montgomery County, you will have page after page of listings. If you have seen one, you have seen them all. How elseare you supposed to seperate them?"

Hmmmm.....Gee...I don't know.........maybe you could ask your clientfor more specifics. Montgomery County is a pretty big place and if you have that many choices, maybe..just maybe, they could find a home in a more specific area. It is a long way from Poolesville to Silver Spring or from Olney to Potomac.

Agents that claim to be looking out for their clients best interest and somehow bring what they will earn into the equation (after the fact) are nothing more than modern day Snake Oil Salesman. They seem to think that they have the right to preclude properties from buyers based on what they will ultimately earn on the transaction. Fortunately, they are rather easy to spot. If you are working with an agent, and the agent did not go over "agency" and have you sign a "buyers agent agreement".....you are working with a Snake Oil Salesman and not someone actually looking out for your best interest.

How do you avoid the shell game? Look the agent right in the eye and ask them if they plan on showing you all the homes that meet your criteria or have they eliminated some because the co-op is not to their liking? Have them put that in writing. It is very easy to do. Ask them to work under contract to you! Have them sign a buyer agency agreement with you that clearly states how much they will be paid to represent you. (Understand, all or most of the money they will be paid will come from the listing broker. That is what the co-op is all about.)

Sign here so we both know where we stand..

There may be laws regarding everyone agreeing on any set commission. There may be laws regarding how an agent must perform. There may be laws that actually require an agent to be under contract before showing you any homes listed with his broker. The only thing keeping you from stumblingand maybe missing the "real" home of your dreams...is the catchy latin phrase "caveat emptor" (let the buyer beware).

If you just blindly go along.....

(2% coop) (3% co-op)

Well...on the surface they may appear the same, but you will never see the one on the left. That is not what Realtors are trained to do. That is not what ethical people do.

But I just learned over wine..........that is exactly what some agents are doing. You may never know the hidden cost of bad advice.

If you want to have someone represent you that will consider your needs and do the job you expect, contact the MacArthur Group today. My clients never see the first house without completely understanding the process and having full knowledge of the costs involved.

I don't have all the answers...just questions

2008-04-28T09:02:01Z

Today is a very special day.

The one on the far right is mine. Well she picked the one on the left ( keep it quiet, he still thinks that he picked her). So, by picking him, he became mine too. Oh, did I mention the tiny one in the center? She showed up about a year after they made their picking legal.

It all started with this.............

Today, the little miracle worker is celebrating one more birthday! Last night, I thought about all the changes having her created. I remember the little girl turning on all the faucets in the public bathroom because she could finally reach them. I remember kittens and cows and horses. I remember the "Hamel camel" on roller skates and hiding so she wouldn't see me watch her compete in gymnastics. I remember singing and driving and laughing. I remember napping with her tucked by my side.

I remember teen age years and boys and makeup and music. I remember jobs and travelling. I remember concerts and parties. I remember the 52 hour road trip for LA to MD. So many memories are etched forever in my heart.

Then there was the day the married. You got to love a man that shows up for his wedding leading a group of Harley riders on his own hog.

So today marks another year of being dad to the most wonderful gift in the world...my little girl...Molly.

I know the joy and responsibility. This morning, watching the news, I just became very confused. I don't know the truth, but I do know the allegations are frightening. What are those people down in Texas thinking? Look beyond the homemade dresses and cookie cutter hair styles. If young girls are forced to marry and copulate with the fella's at an age short of 18, what are they thinking? What sort of warped brain takes a child and uses it for their own pleasure?

Anybody remember little Jon Benet? So many questions go unanswered. I don't know. I don't know if her fate was at the hands of a family member or if the decision to pimp her out as a sex symbol at the age of 5 or so led to someone else ending her life. I don't know. I have to wonder what makes people do that to their children.

You see, today is a happy day for me. I just happened to realize the other side of the coin that exist in every corner of our society. Molly smiles and holds her baby. Molly is probably the most caring and loving mom that I have ever seen. O.K., I am a bit prejudiced. The fellow that showed up on the Harley....he happens to be one hell of a husband and doting dad.

It is a happy day.

Then there are the children that are abused. You see them every day. You just don't know that you see them. Their bruises may be hidden or they may appear to be the kind of bruises kids get rough housing with one another. Maybe they don't go out when freshly beaten. They are down the street from you. They are in every community.

There is a very sick disconnect in some adults. They strike out violently against the very people they are supposed to protect. They punch, kick and slap little children. The violators come in all shapes, sexes and sizes. They are parents, adoptive parents, step parents and baby sitters. They have many different labels but they are all the same. They are emotionally sick and mentally weak. You work with them and play with them. They smile in public and wreak havoc behind closed doors.

It is a happy day for me. I have been blessed with Molly who picked Jason who together brought Rylee into the world. They are all a reminder of what a beautiful world we live in. They also are a reminder of how bleak the world can be for those little boys and girls that face the physical abuse of a guardian.

For today, I promise I will honor my gift by doing what I can to put an end to the violence and promising that every child I meet will get the respect and love they deserve.

Did I go off on a tangent? ......It's ok, this is for Molly and she knows me......I am dad....

What's behind the curtain...Short Sale revealed

2008-04-25T07:39:46Z

The whirlwind of events over the last few years have created changes in the housing market. Industry insiders, like real estate agents, mortgage brokers, appraisers, etc., use a language to describe what is going on that may appear "user friendly" but in reality confuses the public at large.

In recent group presentations that I have given, it has become apparent that there is an air of mystery regarding the housing market. The media picks up on trends, reports conditions and offers affirmations of their position with short sound bites from hand picked experts. They "educate" the public in thirty second stories. The newsprint crowd attempts to go a little deeper, but again, the stories represent a snapshot and the one's that see the light of day had to pass muster with an editor seeking to please advertisers that are far more interested in the number of papers sold than the amount of truth coming hot off the press.

Sometimes it seems that those of us on the inside, enjoy some sort of perverse pleasure in understanding what is going on, while the rest of the public is in the dark. It may be the result of the ongoing evolution we are experiencing while moving from "keeper of all the knowledge" (i.e. the in-house multiple listing book) to a more transparent transactional management system.

I firmly believe that the public has a right to know. Everyone of our future clients can be found out there in everyday life. A well informed public is in a position to make a better decision about whom they choose to represent them. This particular article is about short sales. I won't begin to explain why they are handled differently in one market than another. I won't begin to explain why inconsistencies abound.

A "short sale" occurs when the owner of a piece of property or home sells the property for less money than is owed to the lender or lenders. The sale can only occur with the agreement of the lender or lenders as to how the "shortfall" in funds will be handled.

There are a few options.

The property owner or home owner can make up the difference with their own funds.
The property owner or home owner can sign a new note with the lender/lenders for the difference in funds.
The lender/lenders can agree to accept less than the money owed and forgive the debt of the difference in funds.
A third party may step in and agree to pay the difference.

Now, it is widely reported that if a property owner or home owner can not pay their mortgage(s), they should contact their lender(s) and attempt to work out a solution. There are agencies both governmental and private that stand ready to assist those in need. In a perfect world, short sales would be avoided. Of course, in a perfect world "American Idol" would not be the number one show on television.

It is only fair to point out that property and homes that are put on the market for less than is owed appear to be bringing down market values. The subsequent sale of these properties and homes seem to bring down the average price in every market across the country. If you remove the amount of money owed from the equation, you will realize that any market is impacted by supply and demand. If there is a surge in inventory, it does not matter how much is owed, prices will begin to fall.

The press and those that feed the press are enamoured with numbers and statistics. Numbers and statistics are like the bible. You can twist them to suit your needs. I think it is fair to say that if the number of buyers in the market remains constant and the amount of inventory goes up, demand has not changed..no, the amount of available choices has increased. Any slowdown in sales will be the result of consumers expanding their selection process and sampling a larger volumn before making a decision.

The large increase in "short sales" has created a lengthier buying process. To understand why that has occured will require yet another peek behind the curtain.

A property owner or home owner that is faced with an inability to continue paying their mortgage(s) has to make a decision. How they choose to deal with their problem will impact how the home will change ownership. The owner can :

Stop paying and continue living in the home until the sheriff arrives to evict them after a foreclosure proceeding.
Contact the lender(s) and attempt to work out a new loan or alternate payment plan.
Contact the lender(s) and provide the necessary information to begin a "short sale".
Contact a government sponsered or private agency that assists those in difficulty.
Contact the primary lender and execute a "voluntary foreclosure".

Choices 1, 2, 4 and 5 are always on the table. If choice number 3 is chosen, the property owner or home owner has to follow the steps of their lender(s). There are no hard and fast rules. There is only the fact that the incredible increase in short sale request has most lenders short staffed, overworked and unable to move quickly.

In general, the property owner or home owner will have to provide the lender(s) with copies of bank statements, proof of income, a complete financial sheet and a letter defining their circumstances. Once the lender(s) have this information, they will review it and make their own objective decision regarding whether or not they will entertain an offer for less than is owed.

There are no guarantees. There are no timelines. There is only the facts and each lender is free to deal with each individual as they choose. If they refuse to agree to an offer, the sale can not proceed unless the owner has come up with another way to cover the short fall.

An offer on "short sale" properties or homes may take as long as three months to be approved. In the period that the offer is being evaluated, the bank is ready, willing and able to review more offers. It is the lender(s) that determine which offer is approved. If you think this opens the door to powerful insider knowledge regarding property, you are correct. If you think that buyers will soon realize that working with the listing agent will give them a very unfair advantage, you are correct. If you see through the smoke and mirrors and realize that "short sales" are really mini-auctions where there are no rules, you are correct.

If you now understand, there is no mystery in the term "short sale", well, then I have accomplished my mission.

Milking the "cash cow" to last drop...No payback required

2008-04-24T10:13:15Z

Showing homes over the last month or so, I have noticed a new phenomenon. Bank owned properties seem to be missing appliances. In our market, it is customary that there is a stove and a refrigerator in the home. If you are selling, these items, along with other appliances usually convey. We have a specific document that is filled in at the time of listing that identifies which items will convey.

Apparently, well, let's just say, my best guess is that folks that have stopped paying the mortgage have found yet another way to convert their investment into cash. They can't get a home equity line anymore. The spigot is not totally dry ......

If I am not mistaken, it may be a buyer's market for used appliances at salvage yards and stores that feature second hand refrigerators, stoves, etc. Take a walk around an average home and you will discover that it is packed with treasures. All you have to do is tear them out, pack them up and sell them at a salvage yard.

When you are down and out, it seems you can justify anything. So, off they go to the junk yard. Houses stripped bare. House value reaching the lowest level. Yep, they even tear through the drywall to get at the copper piping. A winterized home is easy to strip.

This little stop ..... becomes the final .....

Is it just me, or does this strike anyone else as the last slap in the face? Everyone is willing to admit that some homeowners made bad choices in loan programs. Most people feel that some loans were presented as the best or only option for a borrower. There were problems all around.

Do we now just turn a "blind eye" to the looting of property? I realize that it is usually being done by the homeowner. I understand, that legally, they probably are within their rights to strip the home. After all, we have told them that they are homeowners.

Who will defend the rights of the neighborhood? It is one thing to see property values decrease because of a market adjustment, it is quite another to see neighborhoods suffer because of the behavior of another.

I don't have an answer. I know the government has addressed the situation by bailing out the big lenders and helping out the people in trouble by waiving tax consequences on the amount forgiven. There is so much boiling below the surface regarding our housing dilemma, we may never see a return to a "normal" market.

I guess I just wonder if anyone else realizes that the stove that is ripped out of home and sold for scrap will eventually cause one student in the third grade across town to have to share a text book. Our actions do not occur in a vacuum. Our society is woven together like a fine tapestry. Pull that string selfishly and you begin an unraveling that will impact others.

I realize you can not steal from yourself....well maybe you can. I wish I could put my finger on why this new behavior stinks. I only hope that the smell will reach a wiser nose than mine and something will be done to correct the problem.

Windfall Profits ????

2008-04-18T07:57:31Z

windfall

Definition

Money received which was not expected and not a direct result of something the recipient did.

There are mumurings that those dastardly oil company executives have earned excessive profits because of the rising price of gasoline/oil. I will agree that the cost of a fill-up is beginning to create this sort of feeling....

It seems like only yesterday, o.k. a lot of yesterday's, that I was working my way to owning my first car and gas was only about 30 cents a gallon. I think it is amazing that I can remember that, much less use the old guy reference so early in a blog.

I came across the following snap shot and it sort of un-nerved me that the prices seemed so reasonable. The rising prices have left my sense of usual and customary a bit dazed.

The outcry from the public is growing louder everyday. This is outrageous. How can the price of a barrel of oil keep going up? I couple weeks ago, it hit $100 per barrel. Now it is approaching $115. Hmmm, it a gallon of gas costs me $3.50 and it goes up at the same rate...yikes....gas will be over $4.00 per gallon.

It is time for the Government to step in and hold hearings.

It must be those oil companies. Or is there another culprit behind this.........

the chinese????? the residents of India/Pakistan ????

or maybe.....

just maybe ........

WE DID IT TO OURSELVES ! ! !

Did we really need that? or this?

Did we really ever need these..?

While I understand the angst of those of us that have to drive to earn a living, and I understand the resentment we feel towards those that are making large sums of money, I don't see why we should penalize others for our own behavior. Why do we think that we can pick and choose when supply and demand can come into play? Throughout Europe, they have been paying higher prices for years. Hmmm, what did they do? They introduced an efficient automobile.

We can spend all our time blaming others, or we can realize that after a long nights rest . . .

We have made our bed....you know the rest.....

So I told Wes Foster.....No More Short Sales

2008-04-16T22:41:46Z

I have been tossing this issue around. I probably have worn out my welcome with some subscribers.

Sorry.

I just can't let it go.

The multiple listing service in this area is becoming clogged with short sales. I know some of them are being done in an orderly fashion. I know that most of them are not. I know that some of those being done in an orderly fashion have no assurance from the lender that they will review any offers.

Well, I think there is only one group that can put a stop to the madness.

It is us.

I have written Wes Foster (the big guy at Long and Foster) and asked him to institute a company wide ban on taking any short sale listing that have not met the following guidelines:

a complete short sale package has been presented to the lender(s)
a detailed approximation of the property value has been sent to the lender(s)
a communication has been received from lender(s) that they will consider offers

If we draw the line in the sand, we will then be offering homes that are actually available for purchase to consumers. The public, as well as, agents have the right to transparency regarding these listings.

It is time all agents began to take another look at the costs of listing homes that can not sell.

If we clear the clutter from the multiple listing service, we may move towards reducing the viable inventory that is on the market.

Some one has to step up. I hope Wes Foster takes the lead.

Spring Inspiration and Positive Views: the end to our winter of discontent

2008-04-14T11:55:41Z

I live and work in close proximity to our Nation's Capital. I have experienced three score or more Springs. As April finds her way clear of chilly March winds and shakes of the dusty remnants of a long winter past........the world changes overnight.

Bright blue skies frame delicate cherry blossoms throughout the area. Grey trees erupt in delightful coat of more shades of green than one could imagine. The dank, musty odor of spring shower covered mulch is removed and replaced by the soft scent of hibiscus, hyacinth and delightful aroma of fresh grass.

No one does Spring like Washington.

I have to admit, I am guilty of stopping and pausing throughout the day. I try to stretch my schedule to allow for time to watch birds build new nests. I create "pretend" appointments so that I can sit on the bank of the Potomac and watch people watching people watch people. Those moments give my time to reflect on my life, my family, my friends and my work.

The roller coaster of seasonal change continues. For me, the first stop each year is Spring. All things are new again. Have we really gone through yet another year? For all the dire predictions, I have survived. I chuckle to myself and am reminded of a quote "Of nine troubles coming down the road, nine will never get here." I don't know who said it. I used to know. It is important to note, I remember the quote, not the author.

As Springs comes in and surrounds me with her passion for new life and new beginnings, I once again welcome every day. I see a endless opportunities to make a difference every day. I have yet another year's knowledge, another year's experience and another year's understanding of the importance of my greatest gift to others.

Compassion. Another season begins and I have a better comprehension of what I truly have to offer in every interaction. I have the chance to counsel and guide people in home buying and selling decisions. I have the chance to share. It does not matter that years from now, they may not remember my name. My hope is that those that buy, will remember the home and those that sell remember the opportunity they had to move on.

Summer will follow Spring and we shall enjoy those lazy, hazy days. Many will pause and enjoy a holiday. It is Spring. It is our time to begin again. It is our time to seize the day. It is our busiest time of the year. If you feel a bit lethargic, take a break, take a walk. It is the time for all of us to renew our efforts to leave the world, our neighborhood and our home in better shape than we found it at Winter's End.

If you have been caught in the paralyzing grip of Winter's bad news; if you have found yourself on the fence, frozen by dire predictions; if you have felt stripped of your comfort zone...it is Spring. It is your time to renew as well. If your plans involve buying or selling a home and you would like a fresh perspective....call me. The MacArthur Group likes to describe our service as "Every Step of the Way". I can't help it, I have to say that Spring puts a cheerful bounce in our step.

If real estate transactions are not in your plans, I heartily recommend that you find a little "me" time and go for a walk, smell a flower or two, take in the beauty and enjoy our Spring. You can join the choir that sings "hallelujah, it is Spring and it is the end to our winter of discontent."

It's a DAMN Lie !!!!!

2008-04-10T08:50:49Z

One of the earliest hi-tech phrases was "garbage in - garbage out". I keep reading statistics. I keep reading blogs. I hear agents sharing the same stories. The market across the country is labled over-laden with inventory. Signs are in yards block after block. It is a buyer's market. Really...read on.

Visitors to websites find page after page after page of listings. One begins to think that there are more houses for sale than could possibly be purchased. Agents do searches for clients and come up with literally hundreds of possible listings to view. Touring new homes on the market becomes a two day adventure every week and at the end of those two days, there remains many homes that are never seen.

Everyone says...........we have surplus inventory. The NAR and various local associations all offer what they purport to be empirical data that would indicate it is a buyers market.

It's a DAMN lie !

The data is not accurate. The data includes homes that appear to be "for sale", but that sale will not happen. The analysis is skewered by mis-labled homes. Every MLS is at the mercy of agents that enter the data. Agents all across the country do the listing appointments and take the listings. Taking a listing does not mean anything other than the owner of the property would like to sell.

Just taking the listing does not mean it is available for sale at the listing price.

If one goes through their MLS and removes all the 3rd party approval needed listings and removes all the short sale homes, the rest of the listings represent what is accurately available. There is no local or national standard for any MLS that requires the home to be actually available at the price listed.

If the owner has not filed the proper paper work to have a short sale approved, the home is not really available and the listing merely represents the misguided efforts of the home owner and the agent chosen to list the property. It may be available in the future. It is not a real for sale sign in the yard. It is a sign that the owner is in trouble and has sought the counsel of agent that does not understand how to handle a short sale.

Now, there are the homes that are on the market in which the agent has done everything and the owner has submitted paper work and the lender has agreed to go along with the effort. Sure they are in the mix. Of course, if an offer has been submitted to the lender for approval, they still appear as active in the MLS. There is no way of knowing that you are spending your day showing homes that may be under contract tomorrow. No one is mentioning that the bank has an offer and there is no category in the MLS for this home as well. After all, the bank wants to get the best offer and the bank has no concern for the groups of home buyers that are looking for a new home that they can actually own.

Remove all the listings that are "for sale" but not actually available and you will discover that the cupboard may be bare and the market is not quite as over loaded with inventory. It may appear that way, but it is not as it appears. Surplus inventory...we don't know. Buyer's market....we don't know. The MLS is accurate?

It's a DAMN lie !

If you feel that the abundance of inventory that is not really availble for sale now doesn't affect statistics, please share. These homes skewer the perception of the market and cost real estate agents time and marketing dollars. In the end, most of them will be foreclosed upon. Most of them will be re-listed with another agent. Most of them will then see a drastic reduction in price.

Lenders do not have an emotional attachment to the outcome. It is dollars and cents. Real estate agents by nature develop an attachment to their clients. We care. We are being emotionally drained to handle a process that is not a process. We go through motions that bring little results. We are the warm up act for the later sale as bank owned property.

Maybe I am just a little slow on the uptake and don't get it. Enlighten me!

Maryland's O'Malley acknowledges Foreclosure Crisis....Finally!

2008-04-08T23:27:49Z

And then, and then ............along came the Maryland House and Senate.............It's a new ball game in the Free State now........

Foreclosure Process Reform Bill - SB 216/HB 365

(amending Real Property Article § 7-105.1)

Signed into Law by Governor Martin O'Malley on April 3, 2008

Effective as to all Foreclosure Filings for Residential Real Property from April 4, 2008

The Foreclosure Process Reform Bill provides important protections for homeowners in the foreclosure process. It affords homeowners more time and notice before and after a foreclosure action is filed right up until the time of sale. It also gives homeowners rights in the process that they did not have before and more time to assert those rights should the plaintiff fail to comply with the law. Because of the emergency nature of this legislation, no foreclosure actions will be ripe for filing for at least 45 days from the law's effective date since lenders will not have had the opportunity nor the requirement to send the requisite 45-day notice prior to the effective date of this law.

Before a lender may file for foreclosure, the lender must:

Wait 90 days from homeowner's default before filing the foreclosure action.

•· Default is defined by the mortgage instrument and, in most cases, it is the day after the payment was due.

•· For example, if a payment due by the 1^st of the month, the homeowner is technically in default on the 2^nd, as opposed to after any grace period allowed for late fees.

Send a uniform Notice of Intent to Foreclose to the homeowner by certified and first class mail 45 days before filing a foreclosure action.

•· The Commissioner of Financial Regulation prescribes the uniform Notice of Intent to Foreclose that all lenders must use by regulation. The emergency regulation containing the Uniform Notice has been submitted for approval.

•· Until the regulation is approved, lenders may comply with the law by sending a 45-day Notice of Intent to Foreclose that contains information required by the statute, including:

• i. The name and phone number of the secured party, the servicer, and an agent who has authority to modify the terms of the loan;

• ii. The amount required to cure the default and reinstate the loan.

•· The lenders must also send a copy of the Notice to the Commissioner.

An order to docket or complaint to foreclose must now include:

Affidavit stating the date of the default and the nature of the default and the date and fact that the Notice of Intent to Foreclose was sent;

Original or certified copy of the mortgage or deed of trust;

Statement of the debt remaining supported by affidavit;

Copy of the debt instrument and an affidavit of ownership;

Original or certified copy of the assignment of the mortgage if applicable;

The mortgage lender and originator's license number if applicable;

Affidavit that defendant is not in the military;

Copy of the uniform Notice of Intent to Foreclose; and

Uniform Notice to defendant that complies with statute

After the foreclosure action has been filed, the lender must:

Personally serve the owner of the property.

Alternate service allowed in the case of failed attempts at personal service:

After at least two good faith attempts at personal service on separate days, the plaintiff may file an affidavit with the Court describing the attempts and effect service by mailing, both certified mail and 1^st class mail AND posting on the property.

Before a foreclosure sale can occur, the lender must:

Wait 45 days from the time the defendant was served.

Publish a Notice of Sale for three successive weeks in a newspaper of general circulation in the county where the action is pending.

Send the homeowner the notice previously required under § 7-105.2.

Accept from the homeowner payment of the funds due to cure the default up to one business day before the sale.

•· The secured party or the agent must provide, upon request, the amount necessary to cure the default and reinstate the loan and instructions for delivering the payment

For more information or questions, please contact Vicki Schultz in the Office of the Secretary, Department of Labor, Licensing and Regulation at vschultz@dllr.state.md.us

Well, sleep tight Marylanders, the wolf at the door has been banished for 45 days. At least by the time the process can begin again it will be warm enough to be homeless comfortably. If anyone sees a man with only nine fingers showing, say hello to our Governer..........the missing digit is stuck in the dyke. The water may have stopped flowing, but he is stuck on one issue and may miss the opportunity to come up with a meaningful plan.

With no other avenues of relief, investing in candles may be the way to go. At this point, all most of us can do is light a candle and say a prayer for those facing foreclosure.

Reflections . . .

2008-04-04T11:53:20Z

Was it really 40 years ago? The media has a "new" focus for the day. CNN is running reports about the murder of Dr. King. I can not begin to count the number of times I have seen this image in the paper or on the television in the last couple days, much less the last couple hours.

Frenzied fingers pointing to the source of the bullet that ripped through Dr. King's face and left him mortally wounded, dreams shattered by one hate filled bullet. Surrounded by friends, left naked to a society that was polarized by the thought of equality for all.

That was 40 years ago today. The focus is on the fallen hero.The pain and memory of the murder is as palpable right now as it was when the news flash raced across America like a wild fire in Santa Anna winds. No sooner had the news reached 120 or so inner cities that those that were caught in the struggle fell into the streets and began mayhem that lasted for days. White America was in shock and fear. Cities were burning.......

As the fire turned to ash and acrid smoke filled the air.......

looting began

Major cities all across the country called out the National Guard to support the over burdened policed. Towns that just a few days earlier had been focused on Lyndon Johnson's pronouncement the he would not seek another term, now faced armed camps.

Fear filled days widened the chasm between the races. Angst ridden hours erased years of progress. A movement that had taken hold in the American consciousness, was becoming unraveled in the wake of the murder of it's most notable leader. One culture could not understand the reaction of the other.

Buildings were burned down, stores were looted and residents of poor neighborhoods howled at the moon in the only fashion available. It was lost on many that this group of disenfranchised people were destroying businesses in their community. While white, middle and upper class Americans watched on television in the safety of their suburban communities, the poor struck out at everything and anything that represented power or a life better than they had. It made no logical sense. It was not burning buildings, no, it was raw burning emotion.

The flames licked smoked clouds that hung over cities and the "silent majority" smugly whispered "I told you so" to one another. "Look at those people", they shared. The smoke got in our eyes and clouded our memory. This was not just a man. How could we forgot that our society created the conditions that gave birth to his cause. We forgot that tired woman that just sat down.

and for that simple act, was arrested...

Millions ride side by side today. King was murdered and we forgot Rosa's legacy. It seems we also over looked.

and this

oh, and we also overlooked the burning anger and resentment for this sort of thing..

Right here in the U.S. of A. , using water hoses against people marching peaceably in protest against unfair and immoral treatment. Bull Connor and there rest of his cronies created a bitterness that will last long after the memory of Martin Luther King, Jr fades. Did we collectively, as a nation, forget that our behaviour (actions) will last much longer than our words?

Today, can we attempt to recall the clarion cry of Dr. King...."I have a dream that my four little children will one day live in a nation where they will not be judged by the color of their skin but by the content of their character." He made that plea 5 years before he was murdered.

In the days and months that led to his murder, his focus was on working towards equality in the workplace at home and ending our involvement overseas in Vietnam. The struggle that led Lyndon Johnson to back off a second term, was also a focus of Dr. King.

In April of 1967, he shared, "As I have walked among the desperate, rejected, and angry young men, I have told them that Molotov cocktails and rifles would not solve their problems. I have tried to offer them my deepest compassion while maintaining my conviction that social change comes most meaningfully through nonviolent action. But they asked, and rightly so, "What about Vietnam?" They asked if our own nation wasn't using massive doses of violence to solve its problems. . . . Their questions hit home, and I knew that I could never again raise my voice against the violence of the oppressed in the ghettos without having first spoken clearly to the greatest purveyor of violence in the world today: my own government."

I have to ask, how much has really changed?We have added a new group to our minority classification. We have voiced a desire to send them back home. We are mired in a struggle in a foreign land that has also revealed our penchant for dealing with opponents through violence. We continue to move slowly in any method of putting an end to the senseless violence we visit with one another. We do little to cease the body count of women and children savaged by "loved" ones.

We speak publicly about a united states of America. Our surface is squeaky clean.Today the lily white majority will hold memorial services. Talking heads will pontificate about the great tragedy that occurred on motel balcony in Memphis 40 years ago.

The truth about our progress and our dedication to the ideals Dr. King shared can be found in the ghettos and barrios in and around our major cities. Ask any young African American about how they are treated when shopping. Ask them about the sales clerk that is so attentive, they follow them from aisle to aisle. Ask them about how they are treated because of their fashion choices. Ask them to paint fear for you and they will paint a portrait of societie's eyes. Ask any older African American how they feel in their gut when a siren sounds behind them when they are driving. Ask any one of the Hispanic speaking immigrants how they are treated on a daily basis. Ask them to describe how their language or skin color has them painted in a corner before their day begins. A man died and his dream is fading after 40 years. Rather than revel in the memory, a nation should hang their collective head in shame. You can not legislate morality. You should not have to do that. We will only become the nation we would like to believe we are by shedding the 200 year old cloak of fear, hate, prejudice, racism, jingoism, isolationism we continue to wear.

I was there.It was a magical day. I grew up in a tiny southern town and did not have a clue. I have lived here all my life. I have tasted the bitterness brought on by the actions of small minded people. My promise today is that even though there are times that I don't think of Dr. King and there are times his murder seems to fade from my conscious thought, I will never forget the roots of his anger and the focus of his mission. I still want to reach that mountain top. I still want to live in a country that is ruled by law. I still want those laws applied equally and fairly to all.

Our opportunity as a people and a nation to become better is always alive and well. Hopes of fulfilling all that our forefathers promised did not die on that balcony in Memphis. They did not die in Parkland Hospital in 1963. They did not die in a California hotel kitchen in 1968. They did not die at any time. They may not seem attainable. They are.

When you ride a bus or a metro today, and the car is filled with people of all races, colors and both sexes, understand, we are better.When you sit at a lunch counter today, and you are among people of all races, colors and both sexes, understand, we are better. When you use any public facility and find you are among people of all races, colors and both sexes, understand, we are better.

We have come this far.

Today, let us promise to finish his journey.

Mission Impossible..?.. Mission Accomplished !!!

2008-03-28T11:55:23Z

I got this e-mail a couple months back. A young couple currently stationed in Germany were transferring to my area and they wanted to know if I could assist them. I wrote back and got a little more information from them.

I called and chatted with them. They found me out there on that interweb. They did their due diligence. The visited my website, read my various blogs and fell in love with my straw hat. (Apparently, a picture is worth a thousand words.) I suggested that they do some on-line searching and send me homes that interested them. I would then go out and visit the homes and report back to them.

They followed those instructions and I filled in my down time with home visits and reports. The husband had accrued time to visit and select a home. The military does allow for this, but the time allowed was going to be tight. It was soon apparent that homes that were in their "wheelhouse" were being snatched up. Our market has remained active for homes that are priced right.

"HIH" day was soon upon me.....(I just made that one up..HIH...he is here, like to keep the records straight. I always wonder who created "LOL".) I received a call and a subsequent email with his travel itinerary.

He was en route! I called in one of my trusty associates and went over the game plan. We had to have an initial "get acquainted and go over the plan" meeting with him Monday evening. I thought a dinner meeting might work since he had been in the air so long. Then we had to divide up the potential homes in two separate areas. He wanted to begin at 900 am on Tuesday. He expected to find a home, prepare an offer, have the offer accepted and fly back to Germany Friday ! ? !

Now this is a time when having strong team members really pays off. Lourdes Tudela joined me in the meeting. We then planned out the mission. She could take the Tuesday morning tour. I would pick up Tuesday afternoon. She would handle two other contracts that were being prepared Wednesday, I would do those tours. Then Wednesday night we would all meet again, to go over progress and plan the rest of the tour.

We had to find that needle in a haystackand then like Diogenes, make sure there was a kernel of truth in the disclosures, value and availability of the property. We did not have time to go through the hoops of short sale, bank owned property or non-responsive agent.

Monday went well.........Tuesday the sun rose... the bell sounded and I heard that wonderful whisper..............LET THE GAMES BEGIN !!!

One by one, homes selected fell by the wayside. Maybe one passed muster. Tuesday afternoon was fraught with more disappointment......one day down, the clock ticking and only one prospect. The best selection from tuesday afternoon was not really available. The agent forgot to mention that they had a ratified contract and were just looking for back-ups. (Yep, I noted their name. I want to be sure I have all the facts before I show any other homes they have listed. They may be peers but they are not very ethical.)

Many houses seen and none just right...........

The clock struck midnite as Loudes and I wrapped up plans for Wednesday.

I added one back into the mix that they had pooh-poohed from abroad. Perceptions from day one indicated that maybe it would fit.

We visited. He swooned. He called the wife. He took photo's. Then he said......what else do you have? Can I see some comparable properties? Let me sleep on it. I suggest that he and the mother-in-law come back in the evening and walk around the neighborhood. Get a feel for the area. Then sleep on it. I will put together a small tour of similar properties for the morning. I am feeling really happy. I think this may be the one and we still have time to make an offer.

As Lourdes and I wrap up and put out the midnite oil one more night, we have high hopes of getting the job done. The morning news would bring another hurdle.

" TWO KILLED IN SHOOTING IN HYATTSVILLE"

I picked the buyer up and he mentioned that they did visit the neighborhood. He did visit all the websites regarding the area. He mentioned while they walked around, they noticed all the police cars roaring off from the station. The incident happened quite some distance away and he still wanted to pursue the home.

We visited a few and he realized..............this was a bargain. We returned to my office, wrote and offer and contacted the listing agent. Thank God for good listing agents! He came to the office, reviewed the offer and called his client. As time ticked by, our client paced the conference room, chatted with his bride and paced some more.

The listing agent came in to discuss the offer and relay his clients reply.

Done......Ratified.........Mission Accomplished.......................72 hours from touchdown on the tarmac to ratified deal in hand.....................DAMN THAT FEELS GOOD !

So, if you have managed to read this tale and feel like you would like to have this kind of support and attention to detail...call me 301-537-4377. When we say "every step of the way"......well we have facts to back that up. Who knows...your dream house may be just around the corner!

Help you hole......or something like that.

2008-03-22T08:00:29Z

I have been asked about the different values of services offered in our industry. It seems that there are serveral "models" active today. It is hard to point out the difference between full service and fee for service. In many industries, the price is relatively the same. I suppose many people don't realize the personal cost of saving money. Many people don't realize the true cost of a discounted service. There is much more to cost than just the dollar value afixed to the service. Sometimes you have to step back and say....do I really want to do that? With that in mind, I offer..HELP YOU HOLE.