The following is a link to a video made by a friend of the family. It is clever and certainly gets its point across…..that Bernie Madoff……………made off. http://www.youtube.com/watch?v=zd8ArvnbVF0
From the category archives:
uncategorized
How much sense does it make for the credit card companies to unilaterally raise interest rates to a level of usuary (in my opinion) when people are struggling in an extremely challenging economy? It is a complete recipe for further disaster. We bail out the banks, so they can stick it to us with their greedy practices. Where is the American taxpayer’s “bail out”? I believe most cardholders really want to pay their bills and, if the companies would work with them, they would be made whole. Instead they push people to the edge until they force them into bankruptcy and, for some, suicide. 100% of nothing is still nothing, when that happens. This is a time in America when we all have to work together and help one another. Somehow that message has escaped the banks whose poor business decisions and greed have devastated many, affected everyone and have done it in a cavalier manner.
I, for one, look forward to the day when I never will use a credit card again. Maybe they have done me a favor after all!!!
I was having a conversation with a client recently to whom I have sold two homes. His current home, his primary residence is now way under water. The purchase price of the home was in the mid $800,000 range. Today the home is valued at around $500,000.
It would be important to note this client is a very conservative man, married with a couple of children. He is not impulsive. He is very analytical, extremely conservative and successful, and has an excellent job plus lots of savings.
For him, buying a home is a very arduous task, as he constantly questions himself about making the right decision. That is where I come in, providing him with enough information, market statistics and emotional support (hand holding) to make a decision.
Recently I called to tell him that I thought we should, in earnest, find him the move-up home he and his wife have coveted for so long. I told him the combination of today’s interest rates and low prices will not last. He agreed and thus began the portion of the eye-opening conversation I am sharing with you here.
I asked him, if he was planning on selling the current residence or would it become a rental property? With almost no hesitation, he told me he would just let the home “GO”. “Go,” I said. This was a radical answer coming from this gentleman. It must be a joke, I thought. I needed to probe further. “Let the home go,” I said, “as in let the bank foreclose on the home?” “Yes,” he replied. “It doesn’t make good business sense to keep it. If you look at the loss on the house in this current market and figure a modest gain going forward, it will take years for the home to reach the same market value as when I purchased it. At that point I would have zero return on my investment. Keeping it would be a very bad business decision.”
I must admit that what he was saying was true. Being analytical, he had looked at the numbers and arrived at his conclusion. He is right. It will take a long time to rebound to its original market value, but let it go…..I couldn’t believe he was actually serious. He was and is dead serious. From his point of view he is looking at the purchase of his current home NOW as a business deal gone bad. He sees no purpose in throwing “good money after bad”, so he wants to purchase his move-up home while he still has stellar credit, verifiable income and strong cash assets. Once he owns the new home, he will let the current residence go. He figures he is better off washing his hands of his bad investment and focusing his attention on building his cash reserves and making other investments that will give him a positive return on his investment. “After all,” he said, “I need to think of my growing family. If I keep the house, it will take years just to see the house reach its original value and I will still be behind the eight ball with no return on my investment at that point. It doesn’t make sense to keep it.”
Suddenly I realized I was staring in the face of a “new” type of foreclosure……….not one out of financial desperation, but one out of financial “choice.” How many others will be making this type of decision and what will it do to an already unstable marketplace?
Learned a great think from my friend, Jay, today about how to shorten URL’s, so you can put them in a “tweet” and not use too many characters. Go to tinyurl.com Once there you can shorten a long URL. You’ll love it!!
| JUNE | JULY | AUG | SEPT | OCT | TOTALS |
| 2,299 | 2,139 | 2,805 | 2,211 | 2,688 | 22,362 |
| 761 | 882 | 957 | 939 | 645 | 7,805 |
| 3,050 | 2,859 | 2,229 | 3,633 | 3,423 | 25,264 |
| 2,009 | 1,543 | 2,908 | 1,633 | 1,455 | 17,833 |
| 1,442 | 1,404 | 1,662 | 1,496 | 1,341 | 11,508 |
| 9,561 | 8,827 | 10,561 | 9,912 | 9,552 | 84,772 |
Thanks to George Sines of First American Title for providing such great information.
| JAN | FEB | MAR | APRIL | MAY | JUNE | JULY | AUG | SEPT | OCT | TOTALS |
| LOS ANGELES | 1,575 | 1,845 | 2,705 | 2,075 | 2,020 | 2,299 | 2,139 | 2,805 | 2,211 | 2,688 | 22,362 |
| ORANGE | 685 | 925 | 883 | 481 | 650 | 761 | 882 | 957 | 939 | 645 | 7,805 |
| RIVERSIDE | 1,580 | 1,840 | 2,270 | 1,700 | 2,680 | 3,050 | 2,859 | 2,229 | 3,633 | 3,423 | 25,264 |
| SAN BERNARDINO | 1,445 | 1,830 | 1,925 | 1,475 | 1,610 | 2,009 | 1,543 | 2,908 | 1,633 | 1,455 | 17,833 |
| SAN DIEGO | 1,711 | 1,193 | 1,259 | 1,442 | 1,404 | 1,662 | 1,496 | 1,341 | 11,508 |
| TOTALS | 5,285 | 6,440 | 9,494 | 6,924 | 8,219 | 9,561 | 8,827 | 10,561 | 9,912 | 9,552 | 84,772 |
You may be, but you must be looking for a modification of a mortgage on a primary residence only. If that is not the case, this blog is not for you.
The California Association of Realtors has created consumer information that details the various mortgage modification programs available through the larger lenders and government entities. For more detailed information, please visit the following website:
http://www.car.org/legal/mortgage-workout-programs/?view=standard
So you’ve just received a lowball offer on your home and you are not very happy. Your neighbor’s home just sold for more and you think you have a better home. Welcome to the new world of real estate. What should you do? Should you sell or should you retreat? Do you have to sell? If you do you must read the following. First of all, you MUST respond to the offer on the table, no matter how ridiculous it seems. Buyers in the marketplace do NOT know, if you are in trouble financially, so they often make a first offer very low. Why? Many of them have been successful doing so. The buyers do not know you or your situation, so they don’t have much to lose………other than irritating you, the seller. Don’t take it personally. A seller or an agent who gets involved emotionally is his or her own worst enemy. This is NOT a personal attack. Step back, look at the good points of the offer. Will they close quickly? Are they non-contingent? Do they have a lot of cash, so closing the transaction seems very likely? Will you be able to avoid appraisal issues?
Once you have looked at the good points of the offer, you must respond to the “ridiculous” offer. Secondarily, because without a dialogue between the parties, there is NO hope of putting a transaction together. Keep the dialogue open. If the buyer does not move much off of his/her position once you respond, you need to look at your response. Have you moved much off of your position to appear ready to make a deal? Are you still overpriced, according to recent sales in your neighborhood? This does not mean you have to “roll-over” to the buyer’s “ridiculous” offer. It means you must negotiate, not put up a wall or be retaliative. If you have made movement on your side that is genuine and reasonable, the buyer will respond. If the buyer does NOT operate in the same way to put a transaction together, the buyer may not be truly interested in your property, only looking for a “deal” and has no emotional involvement with your property. You will not put the transaction together. On the other hand, if the buyer genuinely wants your property, you must continue the dialogue. Ask youself, as the seller, the following questions and base your decisions on your own answers. How much is it costing me a month to maintain this property. Add up all of your costs i.e. mortgage, taxes, insurance, Homeowner Association fees, maintenance etc. Multiply that out for 10-12 months. What is that amount?? Subtract that from your initial response to the buyer and reduce your next response by that amount. Next, calculate your capital gains by subtracting the marriage or single deduction (as it applies) from your anticipated sales proceeds. What if capital gains rates go up 5-10% under a new administration? Factor in that extra cost. Realistically look at how long it might take you to sell your home for what you THOUGHT it was once worth. Is it 1 year, 5 years, 10 years? The longer it takes you to arrive at that optimal selling price, the longer you will be paying money on a very slowly appreciating asset. After costs, what will you really gain and what will the value of the dollar be at that time?
You can see where this is going. If you need to sell your home or really want to get out from under the additional burden of a big overhead, you must be realistic and you must be prepared to deal with reality. Cash is “King” today. Take your money and buy a distressed property yourself. Put your money in a CD and you are probably ahead of the market short-term, if property values keep declining and finally, once the Bush tax cuts expire, what will happen to the so-called “Marriage deduction”? Will it get the hatchet? Who knows? We only know what we have now. So to sell or not to sell.?, If you need to sell or really want to sell…then………………………SELL!!
