Who’da thunk? Realtoring can be dangerous to you health.
Apparently, unhappy clients have expressed their disappointment by getting physical and have even caused fatalities.
Did they really expect their short sale to sell for 30% above the market?
Read more: http://realtormag.realtor.org/daily-news/2012/05/01/attacks-against-real-estate-professionals-surge
Effective Jan, 1, 2012 everyone involved with Freddie Mac short sales will be required to sign an affidavit and be held liable for any misrepresentations they may have caused. This is purportedly to ensure that the transaction is at arms length.
In August, the government-sponsored enterprise alerted real estate agents to the rise in shady short sale deals. The main concern is flopping. There is a growing trend of real estate agents on the buy-side of the deal failing to disclose other bids on the property, rigging the sale at a lower price.
This was based on the theory that if a buyer flipped the property and made a profit, the deal must have defrauded the bank. If we extend this concept then every business that buys a product or service and re-sells it at a higher price would be committing fraud. We know that any merchant that doesn’t make a profit soon goes out of business.
We must realize that this absurd notion comes from the government where little makes any sense. But take care because they will look for any excuse to make an example of you.
This is from the same Fannie and Freddie that has already cost the taxpayers $169 billion and have paid huge bonuses to their executives for losing money.
How big are the paychecks going to top Fannie and Freddie executives? Big. Really, really big. Since the agencies went into conservatorship, Fannie and Freddie’s top six executives have received $35 million in compensation, including millions in bonuses, even as borrowers struggled to keep their homes and got no meaningful relief.
Read more:
I have received a lot of visitors from the Reno Realty Blog because of the discussion on the Belvedere.
One thing I noticed is that the link to the RGJ article no longer work. After 30 days the RGJ places its articles in its archives. You can still find the article if you choose the correct term, and are willing to pay to read it.
I will attempt to address some of the comments at RRB:
Jo Amick says:
June 13, 2011 at 6:30 PMI also think “Tax implications and vacancy rates alone could very well put your return on investment at 4 years + ” to agree with “Nomad”. Guess I got beat to the punch!
I believe that all “tax implications” were wiped out at the Washoe County tax sale.
Renter says:
August 16, 2011 at 1:58 PM
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Back to the discussion on being an investment opportunities, what seems to kill the deal is the “mechanic’s liens number in the hundreds”. I believe there are over $80K of liens on each apartment there.
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As I understand the law a tax foreclosure takes priority over all other debts and obligations except IRS liens. Therefore, the mechanics liens were also wiped out.
GreenNV says:
August 16, 2011 at 7:52 PMOK, this is my understanding. In a foreclosure situation, all the junior lien holders have the right to bid to try to maintain their interests in the property. If they don’t and the Trutees Sale is completed, their claim on the property it expunged.
So for the Belvedere, short sale properties still have the mechanic’s liens in place and should be avoided. Properties that have gone TD should be free and clear of the mechanic’s liens. I think buying a unit from the bank is pretty safe legally (given the other risks), but there are NOT any of the foreclosed units on the market right now. That smells fishy to me, so there may be more to the story.
This would be correct if it were a Trustee foreclosure sale or short sale. The Belvedere properties were NOT short sales nor were they Trustee sales. These were tax deed sales, sold by Washoe County.
By using the tax foreclosure sale route the property no longer has any bank debt, mechanics liens, HOA liens.
The bank did not buy the properties. According to the RGJ, they were all bought by Madjlessi’s lawyer. Therefore, the bank is NOT the seller.
I welcome and invite your comments and especially your corrections to anything where I may have been in error.
Please feel free to Like this post.
Here’s a podcast with peter Padilla and Leslie Henderson discussing short sales.
Henderson & Padilla: Ease The Pain of Short Sales & zero down on the VA Mortgage! May 15, 2011 by NevadaRealEstateRadio
Zillow estimates that US housing values experienced substantial gains earlier in the year, they have dropped approximately $1.7 trillion this year. The drop is 63% greater that the $1.0 trillion drop in 2009. Zillow further estimates that US housing has lost more that $9 trillion since the peak in 2006. Some of the gains early in the year were due to the tax credit and are no longer available.
Even though this is the nationwide averages, some areas have fared better, or worse than other areas. For example, Boston and San Diego have seen a price increase this year. I do not have the statistics for Reno or Nevada at this time. Also different market segments tend to move at different times.
The Reno economy has been extremely hard hit. Jobs are scarce. No matter what the government would want you to believe. Foreclosures and short sales are pervasive. Many over-encumbered homeowners are simply walking away. The homeowners that would normally want to upgrade have little or no equity remaining and can’t move.
Zillow thinks that we will finally hit bottom sometime in 2011 and that it may take 3 to 5 years before we see normal appreciation again.
Read the rest here.