Naked Lady Real Estate, The Bare Truth About Real Estate Investing

They didn't see it coming!

Either Mr. Paulson is not a smart guy or he is a big fat liar. 

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Bank accepted 31% of what was owed....

You guys!  If you're not already excited with what is going on with REO's - please start NOW!  Look at this message we received from Aaron Norris:

July 2nd:

You'll probably get my note but wanted to tell you in person that we got several emails and phone calls today with people winning properties from the auction. Our little email paid off!

We won another two today bringing out total to 17 in 2.5 weeks. Dad did some calculations on 15 before today and figured the bank got 31% of what they were owed on the loans they wrote.

I know you feel the same way about watching other people succeed so I wanted to let you know. Many of these investors have worked their butt off and it has finally started to pay off.

Aaron

Fannie Mae Loosens Guidelines

Minimum down payment requirements for home buyers is being decreased. In January 2008, Fannie Mae increased minimum down payments in areas of "declining markets." Fannie Mae announced that it is doing away with higher minimums and will require new minimums of 3% or 5%.

To read the rest of this article please go to: Download market20update2020june.pdf

Scamers steal homes from troubled homeowners

This is terrible!  These are mmoral real estate companies are who give good honest real estate investors a bad name. Being a real estate club owner, I get numerous requests from RE companies & RE related services to promote themselves through our club and I tell you, I have been seeing some very sleazy companies popping up over the past year. 

Unfortunately, when there are vulnerable situations - the slimy, immoral people out in the world have a huge opportunity to hurt and defraud a lot of people.  It makes me sick to my stomach.  I swear - reading this article about how these scam artist William Hutchings and Xiaoke Li Federal Land Grant Co take advantage of these homeowners makes me want to do something to put help.  I don't think it is enough for me to just "turn down" seemingly slimy companies from promoting themselves through our club.  Now that I see this story I realize that I am at fault too if I see a company that I think is not on the up & up and I don't do something more than just turn them down.

Wow - what a interesting spot I have found myself in here. I've always wanted to offer information on who I thought was a "good guru" vs. the ones who stink because they only care about making money off vulnerable real estate investors.  Now I wonder what I should do with seemingly sleazy real estate related services that I come across?.  My gosh.  There is a greater opportunity to be more of service to the public.   HELP!

For the full article on these scammers read about it on AOL Real Estate.

Short Sale is the only way to sell this house...

Guess what...  my house in Taft is in escrow and we just got the appraisal back.  When I bought the house my ARV was $150K.  The the property plummeted in value at the end of 2007 and in Feb I had to sell it for $125k.  Now 3 months later after dealing with the non stop demands of the buyers lender, we finally got the appraisal done.

Drum roll...  how many of you think I am going to say something good? 

How many know that I am going to say something so sad...   

It appraised at... $75K.  There is said it.      

The sucker lost 50% value....  what a crock.  So now, in order for it to close escrow, I will need to get a short sale approved.  Wow.  Can you believe it? 

Actually it's just a relief.  I have been stressed for the last several months over this house.  I knew it lost value.  Of course!  What house hasn't?  But 50%?  Holy schniekies! Can anyone say Short Sale?

I just had a nice long chat with and investor friend who owns 10 properties.  She was telling me that she has been getting together with her mentors and they all are talking about which of their houses will have to go back to the bank.  They just can't sell the houses because nobody is qualifying for the loans. This is almost the case with my house. There are still a few contingencies that we have to cover in order for the house to close.  So even if we get the short sale approved - which we will, I am not even sure we can get the loan completed!  If not then I suppose I will stick it back on the market and try again.

It is what it is. I'm not going to worry about it.  You win some you loose some.  When times get tough you need to pick yourself up and fix the situation as best as possible, learn the lessons and just keep on trucking! This was just an investment property.  There are people out there in far worse situations than me.  They are actually loosing their homes that they live in.  Now that’s sad.

I’ll work hard to make my next deals be winners, so it’s all good baby!

"We didn't see it coming.." What the heck are you talking about?

Today I am at a Real Estate Law & Business Symposium at UCLA.  I was extremely excited to attend this event because I wanted to learn from these very important & smart business men in real estate.  Even though these speakers are extremely educated and are perhaps the top in their fields, I am shocked by how many times I have heard the statement: "We didn't see it coming at all" in regards to the extreme downturn in the real estate market!

Can you believe this?  I almost had a conniption.  I just wanted to raise my hand and ask - WHY? How in the hell could you not see this coming?  I saw it coming almost 4 years ago!  Jeez it's not brain surgery.  People that cannot afford homes are buying them with these ridiculous loans, the new homes industry was building gazillions of homes and selling them for ridiculous prices in neighborhoods that were there was selling for half and sometimes a quarter of what their new homes were selling at.  And don't get me started on Inland Empire.  I was a sales manager for a company that serviced new home construction sites throughout Southern California.  I would go down to Inland Empire and just shake my head wondering who the heck was driving out there to buy those homes and how could they be selling at those overinflated prices!

I just don’t get it.  It’s ridiculous to say the least. Give me a break por favor.  I makes me almost realize that those “who didn’t see it coming” and not just the suits today, I mean everyone who is in real estate – that say they didn’t see it coming all had something to gain from not seeing it coming.

But what do I know... I'm just a pretty little girl. 

Rate Cuts means Mortgage Rates Up? Huh?

Someone emailed me this blog post on Mikes Minute.  It's the first time I have read his blog, and it seems pretty good.   This post he wrote about Rate Cuts is very informative.

To read it click here:  Mikes Minute

I have added his blog to my blog roll for your furture enjoyment!

REO's coming out of our...

Well - I just finished a 3 day REO Bootcamp with Bruce Norris and I will tell you that it has changed my investing plan for the next year at least. 

I will write about it more in detail over the next couple of days, but since I have been getting many phone and email inquiries about it I wanted to post to answer a few questions quickly. 

I have been apprehensive about dealing with REO's let alone going to those big auctions that are selling 1000 houses in one day!  I will tell you that I am singing a different tune today.  I have changed my investing strategy and I will add buying REO's from both the auctions and from REO listings to my overall plan.  The way that I see it, is if Bruce Norris tells you that this is what his plan is - then who the hell do I think I am to argue?

So my plan for 2008 is to continue to buy subject to and put into land contract and now to buy REO’s using what Bruce has taught me.

As many of us are aware, it’s a whole new world out there and what we see now is nothing compared to what's coming.  I feel so lucky to have learned all about REO's so early in this market. I feel like I am ahead of the game now. Boy oh boy.

 

I highly recommend this bootcamp to anyone who wants to learn the how to buy REO’s at auction and through REO agents.  If you are intersted in learning more about the bootcamp contact Diana at The Norris Group.

Update: Knowing a little about real estate: Priceless?

A picture says a thousands words?  Yes indeed.  Update on my post from 10/26.  This house is for rent now.  I can't help but shake my head.  Not in satisfaction, but more like "what a freakin shame."  We are trying to get in touch with her to let her know that we are interested in buying the house on owner financing however, she will not return our calls or emails. 

It's just as well.  Quite frankly, I'm not all that interested in taking on the drama of this house.  It cost us close to 10 grand to move from here (where we offered to stay until she sold it) to our new home (where we had to move because she knew that the reason this house wasn't selling "was because she had tenants".)  With the new house, the deposit, the movers who couldn't make it up our long steep drive (so they took 2-12 hour days to move us) we were tapped out for this move. 

Seller Denial:  50K and counting.  What a freakin shame.

Wake up and smell the... the... for sale signs people!  It doesn't matter what you are listing your house for - now.  There are not many folks out there that can even get a loan right now.  And those who can qualify- are not that gung ho to buy, or just don't feel the pressure to do so.  As Bruce Norris says, the housing market that we have seen is only the tip of the iceberg!

This is why my strategy is to buy the houses that can stay in their existing loans and putting them into a trust and then we can "lease option/rent to own" on steroids.  Batta Bing Batta Boom.  Everyone wins.  Sellers sell, buyers get to buy. 

Doom and Gloom for Los Angeles

Excited and scared...  Bruce Norris, the brilliant real estate "guru" (he's much more than a guru!) was our headline speaker at the club the other night.  Boy can he pack 'em in! We have almost 500 investors there! 

The forecast that he showed us for the next several years in regards to foreclosures was stunning and terrifying to say the least.  I learned so much from him that night.  Wow!  He taught us that not only have we not seen the worse of it, but just how bad it IS going to get.  For all of those folks who still listen to CAR or NAR, you better pull your head out of your butt and do it quick!  It seems that is is going to get 10 times worse before it even starts to look better.

It takes approximately 11 months for the foreclosure to even show up in the public.  Today we are only seeing the foreclosures that started 11 month ago!  We are in for a big shake up over the next couple of years.   I am going to get the solid data that he showed us and I will post it here in the next day.   

Us investors are in for a hell of ride and now is the time to get yourself educated on dealing with these foreclosures and your exit strategy.  I for one am going to focus on getting these deals - hopefully subject to and then sticking them in a Landtrust and "selling" them with no bank qualifying.  There are going to be a gazillion people out there who cannot get financing who need to buy a home!  Move 'em in and Rack 'em up!

Housing crash? What do you think?

This was created by REIC for our Newletter.

Sorry for the small font. The Median numbers say:

August: 588,970

September: 530,830

Denial: $50K. Knowing What Your Doing: Priceless...

Well - I have never been one to boast (ahhemm), but sometimes when you're right, you're... well, you know.

The saga begins...

In June 07 we were given a 30 day notice by our Landlord after she decided that since her house had been on the market for months with no sale in sight, that we, the tenants were the cause of this conundrum. She was adamant that an "empty house sells much better than an occupied house."  Interesting... I had always thought the opposite was true - but OK.

The back story... 

We sold our house in April 2006, right at the very beginning of the down slide. I saw it coming and advised my boyfriend that we needed to sell the house NOW or we were going to loose all our equity.  Thank goodness that was one of the times he took my advise and we put the house on the market immediately.  We did all the right things, emptied it of all our personal chatchkies, redid the back yard landscaping, priced it 10k below all other houses in neighborhood and made it as cute as a button. We got 10 offers in 1 week.  Bam - Sold for asking price. 

We were going to rent for a couple of years after the sale, so we picked this lovely house in Woodland Hills, that was "perfect" for us in every way.  Our new landlord promised she would not be selling her house for at least 2 years since she had only owned it for 6-7 months at that point.  Great!  We moved in July 06.

Fast forward to Feb 07 when she called to inform us that, regrettably, she would have to sell due to personal reasons and she needed the money out of her house now.  She asked if we would like to buy it and she even offered to carry the paper for a year, as long as we could give her at least 50K down now.  What price would you sell it to us for, we asked earnestly?  Well... since we had been such great tenants she would be willing to let it go to us for only $730K.  After all, she bought the house for $689K in 05 and put 40K into improvements and just wanted to get her money out of it....  Let's see - we pay you $730 for this house, when every other house in the neighborhood is listed between 680-690K....  Hhhmmm... Thanks for the generous offer, but we'll pass.

At the time, she offered to wait until our lease was up before she would list the house.  And at the time, I was still in a "helping mood" so I advised her that no - she should list the house now since it was February and well before the summer when the market would be inundated with homes.  Plus the market was really taking a dive and she should get moving fast.  And by the looks of it - it would probably take 6-7 months to sell - if she was lucky!  She was grateful for our willingness to accommodate. She went ahead and listed it for $740K and so then the saga of the "quintessential seller in denial" began...

February, March, April, May, tick, tock, tick ,tock. She starts to get really antsy...  why was no one coming by to see the house?  In four months only 4-5 people came by?  It must be you guys. She would call us weekly to check to make sure everything was OK on our end...CODE for "what are you doing to prevent this house from selling?" Now I'm starting to become annoyed. She has not lowered the price at all, the market has crashed and she is blaming us.  So after I received an irritated email from her, I "encouraged" her to consider lowering her price to what the other houses were listed for which was $680K at the time.  Well - that was it, she was insulted beyond comprehension and she advised me that she knows more about the market than I do, since she used to be a real estate agent and her best friend - the listing agent knows what he is doing.  And another thing! Even though she lived in San Diego now - she was well aware of what the market was like in our neighborhood!  Well... I guess she told me...!

Well that was pretty much the beginning of the end of our saga - hers on the other hand, still goes on today. After that email, for the month of May, she was unbearable. The message was sent on June 1st that she wanted us out in 30 days.

At the point I was eager to leave her tangled web, so without hesitation we went out and found a bigger, better house up the road and all was well.  On June 29th she called us to let us know that she had reconsidered the 30 day notice and that she would be OK if we wanted to stay until the end of July.  We advised that she was too late, we had found a place and we are moving in that weekend! 

Now October - the house sits empty still.

I Drove by the house the other day...

There was sincere sadness when the "I told you so" thought came to my mind, when I saw how desperate the For Sale sign looked - with it's hand written yellow message and new 24 hour recording banner.

She has now lowered the property to $670K...

Now - no one can even qualify for a $670K loan.....

Oh yeah,  after we moved her agent called us with some questions about the house, and he let it slip that she actually received an offer two weeks after she first listed. The offer: $720K.  He said he begged her to accept the offer and she flatly refused.  She wanted full price - period! 

NAR the Voice of Real Estate?

I just read this very interesting article that I got off http://piggington.com/ and excellent blog for So.Cal Bubble News.

It totally confirms what I have been ranting and raving about.  The Realtor world is vastly different than the investor world and for many months now (really - since the beginning of time), I have just been livid over the ridiculous advertisements that I see from CAR and NAR in the papers.  Full page ads that promote "It's great time to buy a home" and "the market is going to go up - so hurry and buy now" propaganda!  I say that if CAR and NAR did not promote this bull that many sellers that are still sitting on their homes after almost a year of being on the market would have sold - earlier in the year.  I know in my neighborhood it is true.  There are people in Woodland Hills who are asking more for their house now than they paid for it 2 years ago!  9 months later... still no sale.  It's a shame....

Piggington.com posts:

"If you thought that there was nothing else that the NAR could do to discredit themselves further, you were wrong"

http://efinancedirectory.com/articles/NAR_Admits_to_Initiating_Bush%27s_...