All Forum Posts by: Shari Posey

We have a unique insider's perspective to the extent of the banks' stupidity and many homeowners' ignorance. I was just looking at an REO listing that went down in price to $325k. I looked at the last sale and it was $730k in 2007 and it foreclosed less than 1 year later. The highest sale in that neigbhorhood at the peak was $530k. Hummm...something fishy, stupid, criminal, fraudulent, etc. happened in that transaction. Even though many typical Americans are outraged by the bailout, they don't really know the half of it.
(FYI--The above example was 100% financing and the second loan was with Countrywide. Did you read that the CEO of Countrywide (I guess he's the almost former CEO) is on his way to Africa with his family on the company jet? This is his last vacation before he gets his golden parachute. I wish I could go to Africa on the company jet!)

Somebody asked why the American public isn't going nuts about the bailout. I think they are going nuts but it's on the internet on forums like this and in Opinion pages in newspapers. We don't march in the streets anymore, we log on to the internet. Plus, by posting on forums you don't have a face that might be called heartless or uncaring to those who are losing their homes. Can you imagine how a person would be raked through the coals by the media if they marched in front of Congress with a sign that reads, "Let the Market be Free! Don't Bail Homeowners! Be a Responsible Citizen and Pay your Bills." The internet has become an annonymous place to vent but that appears to have no impact on our elected officials.

We went to court and our tenant had a friend represent her because she lives out of state. This was small claims court over $680 in security deposit funds but the judge listened to our case for over one hour! (Hard to believe how time consuming small claims court was but I guess that's what makes America's justice system the best in the world).
Unfortunately, even though we didn't keep her entire deposit, which we had plenty of charges to justify, we had charged her for one set of blinds twice so we ended up having to reimburse her for that and pay her court costs. The judge sided with us about the tenant's responsibility to leave it clean and repair or pay for ALL repairs.
It was a good experience that has taught us NEVER assume anything and put everything in writing multiple times even if it seems obvious.

If you plan to stay in one place at least 5 years, then I think you are foolish to rent and not buy. Depending on where you live, some cities/states have first-time buyer owner-occupied deals for downpayment money, lower interest rate, etc. Even here in SoCal you can get into a place for 20% down and it would end up being pretty close to the cost of rent. Buy a fixer and do the work yourself--most people are too lazy or scared to do that so you can get a good price on a place.

After 5 years, keep the house and rent it out so your tenant pays down the mortgage. Then buy another fixer to live in while you do the work.

I'm very conservative but this has worked for us. There are others on this board that have more aggressive strategies to accumulate properties faster with more debt.

That's absolutely CRAZY to pay that kind of money! I work for a company that the banks contract through it it costs the homeowner nothing. In this case, you bank would have to initiate the contact. However, you can go through Project HOPE for free. Our government is paying companies millions to staff Project HOPE so it can be free for homeowners.

Along the same lines, does anyone have experience when an HOA forecloses on delinquent dues and the property goes to auction?? My title company told me that the minimum bid is to cover the HOA lien and that any first or second-lien holders are lost. Of course, you also have to bring taxes current. Is this true?? Usually the min. bid is pretty low and easily covered with cash.

My sister just bought a 3BR gulf-front, full-view condo in Gulf Shores, AL about two weeks ago. It was a short sale that they bid on and closed in 3 weeks. I believe they paid less than $300k and they have several months of rentals already set by the previous owner.

Growing up my parents had about 4 condos on the gulf in Gulf Shores and they always paid for themselves and were sold for tidy profits. HOWEVER, my mom did everything except cleaning herself without a management company and it took up a lot of her time like a part-time job.

It's too early to say if my sister's unit will be a money-maker. FYI--because the complex has an on-site management company it was difficult to finance but they found a local lender familiar with the resort rental business.

AlphaFox...
I don't have a lot of REO listing experience but my first one was a huge hassle and costly until I was reimbursed. I know REO listing agents cry a river over this stuff but if they don't like it, I will happily do the work! I LOVE cashing commission checks!

I know it's impossible for an asset manager to know everything about how bad some of their agents are but I would love to hear from a few asset managers as to what criteria they use to choose agents.

Any asset managers out their that want to provide some insight??

I am only going to speak for myself...
I do work with investors but only qualified investors who are the buy and hold type...here is why...

I worked for one "aspiring investor" last year who had a 600 FICO and was "pre-qualified" for 100% hard money at something crazy like 15% and all the money in her life amounted to $2000 for an initial deposit. She had a big money guy who would buy the contract from her once we were in escrow. I decided to go with it for a while to see how it played out. I showed her some fair deals and then a great one came along. The big money guy didn't materialize and she wouldn't even buy it for herself because of the interest rate, which I don't blame her, but she had no interest to do what it takes to improve her FICO and save up a little money to get an awesome first-time buyer loan.

I would be curious to know how many agents close deals with people making option contracts. Besides, the REOs I have seen specific terms in the contracts preventing switching buyers.

Good luck going directly to the bank for one deal. A bank like Wachovia is national so you're going to call some 800 number and get tranfered 100 times to somebody who will send you a list of their properties that are already listed in the town you want. A bank may use different agents even in the same town and different banks use different agents. In a big city there are dozens of agents who list REO properties. If you are planning on buying in bulk this scenario might be different but to buy one house you'll be doing an enormous amount of leg work PLUS just because it's an REO doesn't mean it is a deal. Just because the property's listing agent is representing you doesn't mean that you are going to get a better deal (i.e. the bank will be giving the agent both sides of the commission anyway). What makes you think an REO agent who is juggling 50 listings from 5 different banks is going to do a better job driving you around to other agent's listings (REO or otherwise) to make sure you get the best deal?

My advice is to get referrals for a trusted, honest, hardworking agent in the area who wants to keep you as a long-term client as you buy more properties. (FYI--I'm a Realtor if you hadn't guessed. :lol: )