Get use to hearing that a lot in the next year.
The variable rates are beginning to reset which I'm told will result in a massive flood of foreclosures.
People are scrambling to get out of loans that many will probably tell you they never should have been in, in the first place.
And the real estate machine will blame the buyer.
Should have known better, shouldn't have committed to a loan that burned up more than 30% of your monthly nut, etc, etc, etc...
But shouldn't the real estate community have stopped these people at some point in the process to point that out.
I mean, someone must have crunched some numbers and figured out the disaster that awaited a family just a few years down the road.
And this isn't just about loans, no, no, no.
What about all the things that go into buying a home.
We just had a family on ABC23 that got into a home that had an addition, and was reportedly told by the seller, that all they needed was a permit and some minor modifications.
Once the ink was dry on the contract, the buyer found out the addition was really a subtraction.
City code had cited 12 violations that had to be corrected in 30 days or bye, bye baby.
I can hear the cry now, "Buyer Beware".
C'mon, be serious.
When I bought the property that my wife and I live in now back in 2001, I had at least a handful of people from different organizations walking us through the entire process.
Was the surge in real estate prices just too much to resist for some?
No, not everyone took advantage of it, but if more than 1 or 2 of your clients are going to lose their home in the next year, then yes, that's a problem.
BUYER BEWARE??
What am I paying the 6%, or 6 points for??
The closing costs, etc, etc, etc...
A friend told me that a colleague in the real estate community wanted to know when all these stories about fraud and foreclosure were going to end.
She said it was hurting business.
I'm sure it was, like this the last time the bubble burst and the time before that.
The long time realtors will survive, the people in it for the quick buck will go back to what they were doing before the boom, and the people who got in to deep will drown.
Yup, Buyer Beware.
Let's hope next time, someone is listening.
1 comment:
What I don't understand about the clientele that our office gets sometimes is, you know when they come into our office we ask why do you want to sell? Is it because your in default? Most of them say no but when I look it up on Realty Trac they are. When asked about it they blame it on the Loan Officer and the company. My thing is, didn't they read what they were signing. It's not like the loan docs failed to mention that in a couple years your loan was going to adjust. The problem with that is that they didn't read they're contract. They were more excited about being approved to even get the home. Everyones situation is different. For some there were those scadelous loan officers that said anything just to get the deal done. Then you have the ones that look out for your best interest. I just feel really bad for all those who are in foreclosure. I try my best to help them.
Short Sales! That is the key right now. There are even companies who do Short Sale negotiations with the Lender for Sellers. That's what I do. Recently there has been talk about a law being signed into California Law where the seller won't have to pay the tax on the difference. They are calling it "Phantom Tax".
I think that when Buyers make an offer on a house, it is very important to use their own inspectors to do the inspections for them. Do not EVER use an inspector recommended by the Seller or Selling Agent.
We had an incident where we represented both parties. Well the first escrow fell out because the Buyer had an foundation inspection done on the home and it need 12K in work done. (older home in Taft). So seller decided he wanted one of his close friends whom he has known for years do the inspection for him. Seller friend came back with a clear report. Both were licensed contractors. Now it is in escrow again and the Buyer performs a Home Inspection. Inspector goes in the Crawl space and finds cracks and other things wromg with the foundation. We show him 2 very different reports from 2 different Contractors. He he automatically said find an outside Contractor. There is something wrong with this picture but it's that type of stuff that gets new buyers in the position that they are in. And they should have been in they're Agents best interest. Agent should have ordered inspections or went down the city to find permits. Also what kind of Lender funded on a home with additions and no permits without a proper inspection?
That's a first for me.
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