Another Real Estate Tragedy

July 11, 2008 · Filed Under Real Estate · 2 Comments 

Why is it that when people involved in a transaction when confronted with a choice of either being helpful or rude and unbending they choose the negative side of things?

Is it as simple as they have a huge need for being powerful and in their mind right? I don’t get it.

Case in point: Clients sell their home in Rhode Island, close escrow and deposit the proceeds in a bank in Rhode Island after carefully making sure that they will be able to wire funds to their escrow account for their purchase in California. Now these clients are elderly and not familiar with bank lingo or practices. They thought they asked all the right questions and damn it the V.P of the bank knew they were going to be moving to California.

Well, they have their belongings shipped to our beautiful sun shiny state and they jump in the car with their three cats and drive out to California. Now here they are in California and so they call the fun, friendly V.P. of the bank and ask her to wire the funds to their escrow account only to be told that they cannot send funds because they have to be physically in the bank when signing the authorization to wire. I understand that….

Now here is where I become totally amazed (and I know I shouldn’t be), why did the friendly, fun, smarter than anybody V.P. not have the client (their customer too) sign a wire authorization when she was there in the bank? Yeah, I know, it is not her job to provide friendly, helpful out of the box service. It is only her job to do the very least because she is thinking about her kids in college or her husbands affair or her affair or what color she should paint the kitchen this spring because her house isn’t worth what it was 2 years ago so they won’t be able to sell and move to the Hamptons.

You know? I think that is why we (collectively) are so amazed when someone does a really good job or goes above and beyond the call of duty to make sure their customer is happy and will become an advocate for them, referring customer after customer.

Oh, I do understand why and wouldn’t it be nice if I didn’t have to and we all did the right thing for our customer?

Happy Funding

Kelly…

What’s Fannie Mae up to now? Will FHA follow?

July 9, 2008 · Filed Under Real Estate · Comment 

You know that when the pendulum swings too far one way, then it swings back too far the other way, until it finally settles someplace closer to center. Well, we’re not close to the center. Fannie Mae’s free and loose lending practices got us into this mess and they are still reacting to the fall out of their bad business practices. The latest bump in the “Real Estate Road to Recovery” is that they are cracking down on buyers who already have a home and are purchasing another home to move into without selling their previous residence. Essentially what Fannie Mae’s Announcement 08-16 dated 6/25/08 says, is that if a borrower wants to keep their property and rent it out, they must have 30% equity remaining in that property. If they don’t, then they can’t use any rental income in qualifying for their new purchase. So, they must qualify with both mortgage payments counting against them. As of today’s date, FHA has not adopted the same policy and there is no indication that they intend to. But keep in mind that many lenders will start to adopt their own credit policies to ensure that their loans are sellable on the secondary market.

The question you may be asking at this point is why? Why now? Why me? Why? Why? Why? Well…apparently there have more than a few people who have decided to purchase less expense homes (because the one they have been living in, they really couldn’t afford in the first place) and then they stop making payments on the more expensive home and the bank forecloses. Thus allieviating the homeowner from that debt while they are now living in a home they can probably afford. Yes, their credit is trashed but they already bought their new home.

People and their creative solutions will never cease to amaze me.

I would send you to fanniemae.com for more information about this change and other interesting facts, except that this public site is just a bunch of worthless fluff. Check it out for yourself and prove me right.

Remember, the “Real Estate Road to Recovery” should be enjoyed. Embrace the journey.

Wallace…

Happy 4th of July!!!

July 4, 2008 · Filed Under Odds & Ends · Comment 

All of us at wallaceandkelly.com would like wish you all a happy and safe 4th of July!!

 

WALLACEANDKELLY…

51 Reasons not to workout

July 1, 2008 · Filed Under Health and Fitness · 3 Comments 

You know you’ve used them; you know you’ve heard them.  Since I am limited in space we will keep this to 51 reasons not to work out.

 

  1. I have a flat tire.
  2. I can’t find my shoes.
  3. My socks are in the wash.
  4. The dog got out.  I know I don’t have a dog, but it’s an excuse.
  5. The cat has a cold.
  6. I’m tired.
  7. The kids want a six-course meal.
  8. I want a six-course meal.
  9. I’m going to wait until Monday to start.  Ooops it is Monday. I meant next Monday.
  10. It’s too hot.
  11. It’s too cold.
  12. It’s just right, but I am waiting until Monday.
  13. I might sweat.
  14. I have a hair appointment.
  15. I have a nail appointment.
  16. Did I mention I am waiting until Monday?
  17. My dog has a nail appointment.
  18. My cat has a hair appointment.
  19. There’s a really good sale today at Macy’s.
  20. The gym I joined is closed.  Oh, that’s right there open almost all the time.
  21. My workout clothes are in the wash.
  22. I’m going to go on a diet before I start working out.
  23. My cousin’s sister’s uncle’s brother is coming in from out of town.
  24. My lawn needs to be cut. 
  25. I could only find one tennis shoe.
  26. It’s only Wednesday and I’m waiting for Monday.
  27. I have to do my taxes.
  28. It’s too windy.
  29. It’s too sunny.
  30. It’s raining.
  31. It’s only Thursday and I am waiting until Monday.
  32. I have to make dinner.
  33. I have to pick up the kids.
  34. I don’t know what to do.
  35. I don’t know what to wear.
  36. There’s nowhere to park at my gym.
  37. My allergies are bothering me.
  38. I have irritable bowl syndrome.
  39. I don’t have a gym membership.
  40. It’s only Friday and I am waiting until Monday.
  41. I have a great book to read.
  42. My favorite show is on.
  43. I have a date.
  44. I have to write a book on why I am not keeping myself healthy and fit.
  45. I have exercise block.
  46. People sweat on the equipment.
  47. It’s Saturday and I am waiting until Monday.
  48. I’m stuck in traffic.
  49. It’s Sunday and I am waiting until Monday.
  50. It’s Monday but my schedule is too busy.
  51. See any of the excuses listed above.

 Welcome to Wallace and Kelly, I am Big Daddy.  Owner and creator of Big Daddy Fitness.  If you have any questions in regards to a fitness program, blog us.  We are here to help.

 

Talk to you all soon.

 

BIG

 

 

 

Modesto Real Estate Short Sales, Oh My!

July 1, 2008 · Filed Under Real Estate · 2 Comments 

Do we really need to talk about short sales again? I mean, should we all just wait for the bank to foreclose on the property and sell it after? Or, should we put the property in a quasi escrow with buyers that love the home and want more than anything to own and go through the aggrivatingly slow process of approval for the short sale?

Let us take a look at what one should expect when trying to close a short sale.

  • 1) Most financial institutions will not begin the short sale process until the borrower (seller) is at least 60 days behind.
  • 2) After the seller is 60 days late the finacial institution will not really talk or negotiate with you until you have an offer on the property and complete a short sale package before they will assign a negotiator.
  • 3) The negotiator will let you know that after they are in receipt of a complete package they will get back to you in 10-15 business days to render a decision. (well that is cool)
  • 4) Except after the 10-15 business days have elapsed they would like you (the agent) to send them a few items that they (the negotiator) know they have, but in order to expedite the file, they need now and can’t afford the time to look in the file.
  • 5) So the same day they request the items you (the agent) fax and email the required documents to them and they reply the next business day that they will get back to you in 10-15 business days. 
  • 6) You (the Buyer & Agent) are in this process for 90 days and are starting to see that you will be in it for another 10-30 business days.
  • 7) Keep in mind the package has been complete except for an offer from a qualified buyer for the 65 calendar days you (the seller) were on the market looking for an offer.
  • 8) When I say package is complete I’m talking about a fully executed short sale package from the financial institution including the BPO ( Brokers Price Opinion) or appraisal for the financial institution.
  • 9) Approval at this point still may not be granted.

So, there above is a very brief breakdown of what to expect when attempting to sell or purchase a short sale. Which all the above happens before the potential buyer of the property has paid for their appraisal and any inspections they may choose to have or the start of the real escrow period which may take anywhere from 30-45 calendar days depending on their financing.

I for one fail to see why this process is so difficult and time consuming. The financial institution in question seems to create more of a process than is necessary. Let’s look at it this way……

  • 1) Homeowner is in financial crisis and calls institution for a short sale package.
  • 2) Short Sale package is complete and in the hands of the processor or negotiator, seller lists property with a REALTOR.
  • 3) Appraisal for value of property is completed by financial institution
  • 4) Homeowner receives acceptable offer and submits to the negotiator along with estimated settlement statement with all proceeds going to financial institution
  • 5) Financial instiution either accepts payoff or doesn’t
  • 6) If they accept buyer and seller move forward and close
  • 7) If they don’t buyer cancels and financial institution forecloses on the property and then sells.

I know… This is way too easy and logical. Let me say something….Either the payoff works or it doesn’t and the payoff doesn’t change by adding 120-180 business days on top of the process. Except that now the homeowner owes more money in interst and principle and taxes and so on. It is what it is! Fire the MBA’s and write a procedure manual and get this done.

This process is rediculous and idiotic. For the life of me, please somebody read this post and explain to me why the process is not ludicrous!

Convince me that the process is there for a checks and balances type of thing and to insure that the financial institution is getting as much of what is owed to them as possible. Tell me that the institutions have not already raped the masses with the exorbitant fees charged upfront and received on the backside of each loan made. When I say this I talk mainly about the liar loans or stated income loans.

Don’t get me wrong….Everyone involved is to blame (here is a list)

  • Buyer, (I bet most of you really knew what you were doing and the risk involved).
  • Loan Officer, don’t do the loan if your buyer just barely qualifies at the teaser rate.
  • Investor, your stocks are not doing well so you loosen your money up rediculously and jump into mortgages because the return is better. GREEDY PRICK!
  • Financial Institutions, you cram rediculous programs down your loan officers throats with spiffs and incentives to close.
  • REALTOR, don’t sell the property to the buyer you know can barely qualify for the teaser rate payment. SHAME ON YOU!! GREEDY PRICK!!

Oh Man! I think I went on a rant…. All this is true, we can all turn our heads and say “no none of this happened” and you will have trouble explaining the curent events.

We all need to work together to make the processes of correction more attainable.

Any suggestions?

Kelly…

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