My New Blog

Reversal of Fortune--Banks Working With Mortgagors

Well, this is a first for me.  I've had a listing for 7 months now that was "subject to short sale."  The owners had moved out already and just wanted it behind them.  They were really stressing about it.  We had it sold twice, but the buyers couldn't get their financing together, so back on the market it would go with a lower price tag.  Yesterday I received a third offer and was in the processing of delivering it to my clients when they called me to say the bank had offered to re-do their loan for 6% if they would move back in and keep the darn thing!  Now, this lender hasn't received any payments for nigh onto a year, and the original loan had adjusted up to 11% which is what caused them to give up in the first place.  

I'm thrilled for my clients!  They get to keep their home at a price they can afford!  I've been wondering for a while now why banks don't do more of this, since it seems to me it's better to be receiving payments at a lesser rate of interest than no payments on a property that can only depreciate as it sits vacant, but I'll have to say I was very surprised to hear that this lender actually did it.  

I was just having a phone chat with a client of mine who always has many many plates spinning at the same time.  She has had several businesses of her own over the years, and is currently running two of them.  One of them is a coffee shop in one of the local hospitals.  Now, the local Ford plant here has recently gotten rid of a number of their employees, and my client's niece was one of them.  Being the great aunt and all around busy lady that she is, she immediately thought of starting a new business with her niece to help her start her new career now that her Ford tenure is over. 

So now they've started an offshoot coffee business called The Caffeine Queen that is a direct sales company that operates on the "party" system--you know, like Tupperware or the Pampered Chef.  They have some really great products and offer a terrific line of gifts.  I know how well this lady's business ideas take hold, so I'm happy to be able to say "I knew her when."  I'm sure this is going to take off, and it's destined to be another great thing about West Chester.  Check out their web site at www.thecaffeinequeen.com  Another cool thing about their business is that a portion of their profits go to a women's charity.

If there's any one thing I love more than selling real estate, it's eating good food.  I'll admit it, I'm a foodie--and I know I'm not the only one.  So I'm thinking, why not give some of my favorite eateries a plug here in my real estate blog.  After all, it only points out what a great place to live West Chester/Mason/Liberty Township Ohio is, right?  OK, here goes.  The restaurant on my mind today is New Krishna, an Indian buffet on Route 42, aka Reading Road, just north of I-275 on the border of West Chester and Sharonville.  It's located in a little strip mall just across the street from Gabriel Brothers discount department store, and if you aren't looking for it you just might miss it entirely.  In fact, I wouldn't have known it was there myself if I hadn't shown the owner a couple of houses.  Now I'm sorry to say that the gentleman went and bought a house with another Realtor, but during the brief time I spent visiting with him he told me all about the massive catering he does in addition to running the restaurant, and he gave me his business card.  Food lover that I am, I eventually got over my disappointment that he chose to purchase through someone else and showed up on his doorstep one day with a serious case of the hungries.

Wow, was I ever NOT sorry I came!  Spread before me was a delightful variety of freshly prepared Indian savories.  Enough variety to satisfy the pickiest of customers, and all of it was wonderful.  I know, because I tried everything.  In fact, every time I go there I almost hurt myself.  I overheard other customers talking about it too, and someone said "I've tried a lot of Indian places, and this one is the best.  I couldn't figure out why until I realized it's the quality of the ingredients."  I agree completely.  It's not a fancy place, just comfortable and friendly, but the food is fit for royalty and very reasonably priced.  If you like Indian food, don't miss New Krishna.

Today I received my subscription email from REBAC (Real Estate Buyer's Agent Council) which contained a link to an article outlining FHA's new plan to help some of the borrowers who are flirting with foreclosure due to a reset on their ARM.  The plan is called FHASecure, and it won't help everyone, but if certain conditions are met, some borrowers who fell behind when their rates adjusted and their payments went sky-high will be able to refinance at a fixed lower rate.  I'm just passing this along in the hope that someone out there reading this will be able to use the information.  Here's the link to the article.

http://bankrate.com/brm/news/mortgages/FHA_bailout_a1.asp

Just came back from my office's monthly sales meeting.  My manager shared a statistical report with us showing how average prices in our area for the summer quarter compared with the same time period last year.  It was obvious that prices are down--especially for condos.  What a tragedy for those who are trying to sell their condo, especially if they wanted to use their equity to get into a single family home!  On the other hand, if you're a buyer in the market, there's a heckuva sale going on!

The other thing the stats pointed out was that not all areas of the Cincinnati metropolitan area are seeing the same type of market.  Inner belt neighborhoods seem to be much more stable than the suburbs at this point.  I suppose that may have to do with the older area's limited supply of homes as opposed to the suburbs where contruction is busily turning out more and more units, but it's interesting to me that most cities die from the inside, and right now Cincinnati is enjoying something of an urban renewal.

Bank-owned properties

As everyone knows, we are seeing a lot more bank-owned properties on the market these days.  For many people, the first thing that comes to mine regarding bank-owned properties is "bargain."  That can be the case, but it's not always easy to complete the transaction.  I am currently in the process of helping a client purchase a bank-owned condo, and after several weeks of being involved in the process, my client looked at me with frustration in her eyes and asked plaintively, "Is this normal?"

 Giving her a short answer to that wasn't easy.  There is no such thing as "normal" in reference to bank-owned properties.  First, THEY tell YOU how much earnest money you're going to give them, and they may insist that you get prequalified with the lender of THEIR choice before they will even look at your offer.  Then they present you with an intimidating stack of paperwork that appears to take away all your negotiating ability and give you lots more responsibility than most people are accustomed to in more traditional transactions.  Then and ONLY then will they consider your offer.  Maybe they'll get back to you in a timely fashion, and maybe they won't.  It rarely has anything to do with the contract dates you write in your offer.  More likely their answer will be scheduled around the business hours of their department, their work load, vacation schedules, and who knows what else.  Maybe you won't get a response at all.  If you are fortunate enough to get a response, it will most likely be a counter-offer, or maybe a notice that they have received multiple offers and they will entertain all highest and best offers from all parties at some future date.  Once you get an accepted contract, it will probably be a verbal acceptance at first, and you'll have to wait as long as it takes to receive a copy of the executed contract before you can set about scheduling inspections.  On the other hand, they will definately hold you to the closing date you wrote in your offer, no matter that THEIR processes have slowed the whole progression down.  Too bad if that inconveniences you, but if you take longer than you said you would to close, they may decide to sell it to someone else.  At the very least, you'll be paying a per diem fine for every day past the original closing date you go. 

Every transaction is different, but my advice to my client and anyone else considering looking at foreclosures is " expect the unexpected."  Be persistent, patient, and flexible--and of course, get yourself a good Realtor.  If you're in Cincinnati, I volunteer!