Olga's foreclosure has a happy ending

At least it was a happy ending for the buyer of her home who I met the other day. He paid $404,500 including the 5% buyer's fee at the Real Estate Disposition Corporation's last public auction.

The interesting part of the story is one of my first conversations with Olga in March 2005. I told her the value I saw for her home, and she disagreed. At the time, the home had already been on the market 4 months priced $645,000-675,000. I quote Olga: "As realtors, it should be suggested to sellers to market their home accordingly and work with the neighborhood and not to their own advantage." She was implying I was giving her a low ball price just to make a quick sale if I ended up listing her home. My value was a high price of $625,000. She further went on to say: "I have done my homework and have had several evaluations from several experts and $645-$675k is certainly in the ballpark for our home".

She ended up convincing another Realtor to take the overpriced listing at $640,000-670,000 in April 2005. To make a long story short, over the next 2 years, it went through 3 real estate agents, and 1 REO listing without the home being sold. She wisely refinanced for $540,000 in August 2005, got some tenants in there, and then high-tailed it to Texas finally leading to foreclosure in April 2007. 

Even though that might have been a seller's market then, and today is a buyer's market, the lesson to be learned is still the same: there are real estate agents that will take overpriced listings and seller's who think they know the value of their home better than an experienced agent. Having an overpriced home can end up costing a seller both time and money. Seller's should do their homework, that's for sure. But it should be researching and interviewing agents to find out how well they know the local market, how quickly they sell homes, and how many homes have they sold recently among other things. It's an important part of your financial well-being and should not be taken lightly.