Help!

Unless you are living in a hole, you are aware that there are a record number of foreclosures across the country. If you are living in a hole, it might be because you have been foreclosed upon. And if your head is stuck in a hole in the sand, you might very well end up in foreclosure.

The state of Ohio has the dubious distinction of being number one in the nation in foreclosures. There are many factors; stating that the housing bubble has burst is putting it much too simply. What caused the bubble to burst.

Banks, realtors, bankers, home buyers, home sellers, bankers, mortgage companies, government regulations, lack of government regulation. Oh, did I mention bankers and mortgage companies?

In other words, we all had a small part in it if you have been involved with buying or selling a home in the last 3 years.

Realtors:
Hindsight is 20/20. If someone walked into our offices and wanted to buy a house, we didn't care how or why the mortgage company lent them money, we just sold them a house. I have been guilty of this and have even gone so far as to tell young couples that money was so easy to come by that their dog could get a loan. Half in jest, full in earnest.

Banks, bankers, mortgage companies:
Come on guys! Did you really think that someone making $40,000 a year could afford a $300,000 house?! During the last 3 years, banks seldom looked at ratios (your income in relation to your debts). All they wanted to see was your credit score also knows as your FICA. [Credit scores are based on your ability to pay back money, ie make monthly payments on time. So theoretically, if you owed a million dollars, the bank didn't care as long as you made your payments on time.]

Also, the banking industry came up with all kinds of "creative financing" designed to get you into just about any house your little heart desired. Interest only, balloon, adjustable rate, no payment for an extended amount of time (then they hit you big). More on all of these terms later......

Buyers and sellers:
Okay, so its natural for everyone to want a place to call their own. It is also natural that if someone is willing to give you money, you will take it. So if a buyer can give a seller money, the seller will stand there with their hand open. And the more money to spend, the more was charged. (Do NOT confuse this with inflation.) This phenomenon caused a little condition known as "getting upside down." Sound uncomfortable? It is, especially if it involves your pants pockets being open whilst you are being hoisted into the air by your ankles. More on this condition later.......

Bank regulators vs de-regulators:
Think about the Savings and Loans scandals of 20 years ago and make up your own mind. If you are less than 2o years old, ask a grown up.

So, if the foreclosure dragon is breathing down your neck, HELP! is on the way.........

A Day in the Life

First thing this morning, when I got into the office, I was greeted by a fax. It was a signed extension for a closing date for my repeat client/purchaser of dumps. (Hereby known as "Dumpster". Dumpster had made an offer on a property in April while my back was out. It was a fun day, showing homes that a sane person wouldn't even go into yet there I was actually having to sit in them because I couldn't stand.

Dumpster made offers on all we looked at hoping one would stick, which it did. We negotiated a price with the listing agent, it was accepted and we were looking forward to closing in about 2 weeks. 30 days is usually standard turn around time but when buying dumps, there are usually no inspections - termite or otherwise. So if you have great credit or cash and are a do-it-yourselfer, crappy houses make a great investment.

Anyway, my buyer is ready to move ahead. The title company ( the entity that gathers all information regarding a property such as tax information, mortgage payoffs and financing and researches the title to the property to determine that the person that is selling actually owns it) discovered that the person selling actually did not own it. The sale of the house was part of an estate which had never gone to probate to settle who gets what. All of a sudden everything comes to a screeching halt while we wait for the property to go through the court system.

So here we sit in July waiting for something to happen. Luckily (and I use this word frequently because real estate tends to hinge on it), Dumpster is hanging in there.

Bennett Realty is a great place to work and gives its agents a lot of support. And my broker is not a micro-manager but is always there when you need him. He just asks me periodically if the deal is still alive and I reply, "Yeah, so far!"

The moral of the story is, work just as hard for a client buying a crappy house as you do for one buying a McMansion. People are people. And besides, I bet you'll find that the person buying the pieces of crap is a lot more fun to work with.

Get Back

The real estate market has its ups and downs; no different here at Bennett Realty. 2003 to early 2006 were "wonder years" - everything was hot, unfortunately few bothered to wonder what would happen in the future. The media touted an imminent real estate bubble bursting.

It is difficult, however, when you are in that speeding train to envision it coming to an abrupt halt.

But it is not as though houses have disappeared. They are still here - Clinton County is awash in for sale signs. The influx from DHL's relocation here did not come. Builder's keep building in hopes that someone will want THIS house when no one wanted the last one they just built.

But amid this seeming gloom and doom, I have been rather lucky. Lucky considering that during the "pop" of 2006 I became ill and had to take a leave of absence. I thought I was washed up as a real estate agent. This is a very competitive business so if you stumble, you are bound to get trampled.

So when I came back to Bennett Realty in August of 2006, I was pleasantly surprised when a steady flow of clients came my way. Now, in July 2007, I am finally feeling the pinch.

I'm telling you all of this back story so you will know where we are now.

I have had about 10 closings in the past 10 months. Don't know how that holds up to other agents but for one who fell off the face of the earth for 6 months, I am indeed lucky. The last closing I had was a couple weeks ago. It was a clash of wills from the beginning. It finally ended with the threat of law suit (Bennett Realty was not the cause or influence).

I have 2 transactions in the pipeline right now, both with the same repeat client. We all like repeat business but this particular client nets me less than $500 per closing. He comes to me whenever he is in the market for a new "dump", "piece of crap", or "roach motel". Find out more in my next posting........