Category Archives: Social Issues

Okay, so I know many of you are probably tired of hearing me talk about the foreclosure mess that is ongoing.  But it’s real.  It effects buyers.  It effects realtors trying to make a living.  It effects neighborhoods with deteriorating housing.  It effects housing values.  It effects tax payers.  It effects bank profitability.   Title companies.  Contractors. Etc.  The only people that I can think of that really benefit are the lawyers.  Need I say more?

So back on September 23 some clients of mine reached terms to purchase a bank foreclosure in Olathe.  The closing was to be on or before November 5 but everyone agreed, as is usually the case, to close much sooner.  Then everything ground to a halt and the buyers were told they would close by 11.5 but not before.

On November 4 I start getting calls from the listing agent and the title company.  Everyone was insistent that we sign an extension immediately to keep the house under contract.  So we eventually signed one extending the closing until November 30.  They kicked it back saying they wouldn’t extend past November 26.  Okay, you should grab a calendar.  They were being pissy about the day after Thanksgiving, a Saturday and a Sunday and then two business days, Monday and Tuesday.  Apparently my buyers and I were the only ones that had a calendar or could read it.

So we signed their extension through to only the 26th.  So on Wednesday afternoon I get an urgent email and a phone call saying we need to get an extension signed because it hasn’t closed.  No crap.  Of course, I was the one that had to call them ask what the hell was going on.  But that’s another story.

Now they want another extension signed through December 27.   I would again refer you to a calendar.  That’s the Monday after Christmas. So we all know that there won’t be any work done at the title companies or the asset manager’s place on the 24th, Christmas Eve.  Christmas is on Saturday.  Sunday, no way.  But let’s back up, I’m also sure we’re not going to see too much work done on the 23rd, either.

And again with the same terms.  You know, bank has all the rights and the buyer just has to bend over on the bank’s whim.

I’m not trying to be rude here.  But does any of this sound normal to you?  How is the buyer supposed to move forward?  And he doesn’t have a plethora of other options.   Why?  Because of the foreclosure freeze there aren’t any new foreclosures, or very few actually, coming on the market at this time.

This is a fine mess we’ve gotten ourselves in to.  🙂

You may have noticed a halt in postings these last couple of weeks.  I apologize.  But I’m really frustrated and fed up with real estate in America right now.  And to Bank of America I say a loud “Boo” to you.

Seems these freaking banks are bent on destroying realtors’ lively hoods.  They certainly helped to create the financing mess we found/find ourselves in.  Then they couldn’t find their asses with both hands during the rise of short sales.  And now they have decided that all the foreclosures they have done/have been doing may not (or may have.  Who knows?  We’re just lawyers.) have been legally sound.  Who is running these banks?  Anyone anywhere have a clue?

People and realtors and businessmen from all points across America disagreed with me when I yelled “Let’em fail!”  I was told the economy couldn’t handle it.  Main Street would be devastated along with Wall Street.

Well, you know what?  Who keeps taking it in the shorts?

I don’t get to draw a six figure salary while screwing up and then get government backed loans and guarantees if I mess something up.  These cats do?

Who is going to compensate me for the closings I have that have now been halted?  I’ve done the work. I’ve identified the properties.  I brought a ready, willing and able buyer.   I read through and explained their 34 pages of ridiculous addenda.

And what about the buyers?  They are willing to redo these houses and get the inventory off the public-backed payroll…so to speak.  Now these homes will languish causing banks asset sheets to look bleak requiring a conservation of capital which will choke lending which will require taxpayers to come to the rescue again which…  Get it?

During the real estate boom banks were fighting states to get in to the real estate business.  Is their goal to bankrupt the established real estate structure?  (Maybe I’m a bit overboard there.  Maybe not.)

First financing caused me to have to move away from multi-family homes.  So I adjusted and started working with foreclosures.  This time, I am not sure how much I care to adjust and come up with a new strategy.  I have options.  I’m mad.  And I probably shouldn’t even be publishing this.

But many of you know me from years of reading. If you have an account at a large bank, I’m begging you to close it and move it to a community bank that was more fiscally responsible.  Let’s all just say “screw you” to these people where it matters.

Whew.  Let me be the first to say I hadn’t realized how good things had gotten.  🙂

Mathematically or statistically or however you choose to measure recession I think one thing we can all agree on is how little confidence citizens of the United States currently have in both our economy and our leadership.  (Leadership being all of’em before you think that as an Obama slam.)  When people are confident their employment will last they spend money and buy houses and travel.  When people are not confident they hold back.  It’s really not all that complicated.

Jobs, people.  Jobs.

From today’s Yahoo! Finance:  The 10 American Industries That May Never Recover.

9. Realtors. The National Association of Realtors reports that there were 1,370,758 realtors in October 2006 — the peak of the market. By the end of 2007, the figure was below 1.2 million. The number is below 1.1 million today and has continued on a downward trend. Home prices have dropped so far and so few homes are sold, that the ability to make money in the business disappears by the day.

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First let me say that I’m glad over 200,000 realtors have gone bye-bye.  I suspect that number will nearly double after December 31 when agents have to pay their yearly dues adding up to over $400 in KC and more in other areas.

Let me also say that as a realtor I am self-employed and like any other business I own or have owned my success or failure is a formula of effort, research, preparedness and a little healthy dose of luck goes a long way.

As if you needed more proof that the people that helped to get us in to our current real estate mess just don’t get it…well, here is a letter from the CEO of Keller Williams Realty to all associates;

Dear Associates –

We’ve recently been alerted to heightened enforcement from Fannie Mae of a per-broker limitation of 30 active REO listings from any one Fannie Mae source, and want to assure you that we have been diligently working behind the scenes on your behalf to address this issue.

While we understand that this policy is designed to curb abuses and ensure that all Fannie Mae-backed REO listings receive the necessary attention to detail, we were quick to point out to Fannie Mae’s leadership that the real estate industry’s most efficient REO specialists have invested heavily in people and systems. As we all know, efficient disposition of REO properties is critical to reestablishing stability within the real estate market, and it serves no one to severely curtail the operations of the most successful producers who understand the high-volume, low-margin nature of the REO business.

We also want to dispel the rumor that the National Association of REALTORS is in support of this limitation. Our sources at NAR have indicated that they share our conviction that top-producing REO agents are an integral part of the solution, and that dismantling their businesses in the interest of opening the field to more players serves no one.

Click here to find the letter that we have sent to the President and CEO of Fannie Mae that outlines our position. We look forward to working closely with Fannie Mae in promoting the highest standards quality and professionalism, and will keep you in the loop as this matter develops.

Yours in leading the way,

Frankly, I have to tell you I was dumbfounded that this rule was even in place!  REOs are low profit, exasperating work.  Professional real estate agents smart enough to put together a team of 3-8 people to review, list and successfully sell foreclosed property have to deal with governmental minions who need to leave by 4:30 each day because they cannot stand to work a minute’s overtime.    Does it occur to Fannie that this is survival of the fittest?

If Fannie Mae doesn’t like how an individual agent or team is doing with their inventory wouldn’t it be better to fire that realtor (and/or team) and hire someone else?  NO!  We just have to make a rule that pertains to everyone.

I know I sound terribly sarcastic at times.  But this is just more proof that Fannie Mae just doesn’t get it.  Perhaps they never will.  I don’t know. 🙂

My head hurts.  More rather, I hurt for my kids and their kids.  I’m going to take a very un-popular stand for a real estate agent to take:  The Home Buyer Tax Credits are bad for our current housing market and they are bad for the future health of our economy.

The Washington Post
The home-buyer tax credit:  Throwing good money after bad

Yahoo!
Congress set to expand home-buyer tax credit

Oh, don’t get me wrong.  These are the rules before me so I will maximize those rules to the full benefit of both my clients and my family.  I’m going to need to.  Can you imagine the weight of national debt our children are going to have on them?  What will Jake’s effective tax rates be when he’s forty?  (He’s currently seventeen.)

And then, as if Fannie Mae cannot mismanage the system as they have it now, they are going to start renting back properties to the very people they took them from!!!!!!!!!!  (Thank you Aaron for the heads up.  Sadly, this was already on my radar.)

Yahoo!
Fannie-Mae to rent out homes instead of foreclosing

Never in my life did I expect to have a government so bent on buying votes.  Is there anybody this administration is not trying to throw money at?  I don’t get too political here on this blog.  But it cannot be too hard to figure out that I am a fiscal conservative.  There are times to borrow and times to pull back.  There are times to invest and times to take your losses.  How much debt will we have standing before us before this four years is over.  Bush spent like no other President ever and I resented that.  But this guy is spending so many times what Bush spent it’s unbelievable.

Take advantage of it and use it to your benefit.  You are going to need hard assets when inflation comes.  And I’m more convinced than ever that the government will have to use inflation to eliminate some of the debt.  Buy an investment property or two for your future.  You’re gonna need’em.