There has been a considerable
amount of discussion in my office lately about the Short Sale process.Many agents state that they
hate Short Sales and they do their best to stay away from them.With the Federal Government’s plan
to try and help homeowners stay out of foreclosure, the number of Short Sales is only going to increase.
So, let’s take a look at some
of the more common issues that arise out of a Short Sale.
1.Who accepts
the offer that I have made on a Short Sale property, the homeowner or the bank?
The thing to keep in mind is that you are negotiating
with the homeowner and not the bank.If the homeowner accepts your offer, you have a deal and it’s
time to open escrow.
2.Once the homeowner accepts my offer, when will the escrow open?
Unless you, the buyer and the seller have agreed
to other terms, according to the Residential Purchase Contract, escrow should open within 72 hours.
3.Is the offer contingent on bank approval? What happens if the bank doesn’t approve the price?
The offer on a short sale
property is contingent on the banks approval of the price.If the bank doesn’t approve the price,
then the escrow cancels and you walk away and your deposit is returned to you.One of the things I learned
early on with the Short sales that I’ve done in Big Bear is that if the bank accepts the price, then they will want
to close as soon as possible.
4.How long does it take to get bank approval on a Short Sale?
Every sale is different and so are the banks that hold
the mortgages. There are a number of questions that your buyer’s agent needs to be asking before
the offer is written.Questions like, has the seller submitted his Short Sale package to the bank?Has the third party authorization been submitted?Without this document, the seller’s agent
can’t speak to the bank regarding the Short Sale.Is the seller’s bank open to a Short
Sale?Does the listing agent have comparable sales to support the asking price?Depending
on the how these questions are answered will have a lot to do with how long it is going to take for the bank to get back to
you on the Short Sale.In my experience in selling Short Sales in Big Bear, I’ve seen banks approve
the Short sale in 7 days. I have also seen them take 6 weeks to approve.
5.How
long after the bank approval of my Short Sale offer will the escrow close?
Every bank is different but my experience has been that
once the bank gives you written approval of the Short Sale, they want it closed as soon as possible.The
last Short Sale that I closed was in Sugarloaf and the bank gave the buyer 21 days from the date the bank accepted the price
to close the escrow.It isn’t going to matter whether you’re in Big Bear or Los Angeles.The bank is going to want the escrow closed as soon as they can get it closed.
6.Should I do my inspections and get my loan ready before the bank approves the Short sale price?
Whenever I write an offer
on a Short Sale in Big Bear, I use the Short Sale addendum. This is one of many forms available to us through the California
Association of Realtors.This addendum provides the buyer the opportunity to not have to start the inspections
until the bank has accepted the price in writing.If the Realtor doesn’t use the Short Sale Addendum,
then you as the buyer have 17 days from date of acceptance from the seller to do his inspections and get the loan in place.
7.Will I be reimbursed for the home inspection and loan fees if the bank doesn’t accept my offer?
The answer is NO.This is one of the risks that you as a buyer will take if you are looking to take advantage of a distress sale.This is another reason why you need to make sure that you are working with an experienced Short Sale Realtor.
8.Why use a Realtor?Why don’t I negotiate on my own with the seller?
Not only do you want to use
a Realtor, but you need to make sure that you’re working with a Realtor who has a lot of experience in Short Sales.By making sure that you have the right Realtor working for you, you are going to improve the chances of your Short
Sale being approved.By using an experienced Short Sale realtor, you will get a better idea from your Realtor
if the home being offered as a short sale even has a chance of closing.
I am a short sale specialist in the Big Bear Lake, CA.If you’re
a buyer looking for deal on a short sale in the Big Bear valley, hit me up.I am available any time at
the office, 909 866 3481 or by cell 909 436-8043.My email is tony@ tonycard.com.If
you are a buyer who finds himself in a position where you’re behind and don’t know what to do, get in touch with
me so we can discuss your options to a foreclosure.
One of the agents in our office sold a bank
owned property to a client of his just recently.When the buyer arrived for the home inspection, they opened
the house and found it flooded.It turns out that the pipes broke due to the lines freezing while there
was still water in them.Frozen pipes are very common in Big Bear if you don’t winterize the property
when not in use.My question is this.Who is responsible for the repairs
to the house?
According to the verbiage
in the California Residential Purchase Contract, the seller is required to keep the home in the same condition that it was
when the offer was accepted.In other words, if a window is broken after the offer has been accepted, the
seller must replace that window before the close of escrow.
As this was a bank owned, REO property that was sold, there is no guarantee that the bank is
going to make the flood repairs.When an offer has been accepted on a bank owned, REO property, the
bank sends out an addendum to the purchase California Residential Purchase contract that changes any number of items.Before assuming that the bank is going to make the repairs that would be
necessary to bring the house back to the condition that it was when the offer was accepted, read the addendum.
In fact, before you
entering into escrow on any bank owned, REO property, make sure that you read and understand the addendum.
That is a very common
question that I get from buyers who are looking to purchase a home in Big Bear.It matters not whether
it is a Seller’s market or a Buyer’s market, the question is asked. I’ve even been
asked if it is safe to figure on offering 30% less than the asking price, no matter what the property is or how long it has
been listed for sale.
My answer to this question is this.Every property is different and you need to look at
all the data that you have in order to determine the value.
A good example of what I am talking about
is this.You find the perfect home in Big Bear and you decide to make an offer.You
ask your Realtor how long the cabin has been on the market and you see that they have been trying to sell it for 270 days.Just because the cabin has been on the market for 270 days doesn’t mean that the current asking price isn’t
a good value.In the 270 days that this cabin has been listed for sale, how many times has it had a price
reduction?What was the starting asking price? What are the neighborhood homes selling for?Is the current asking price in line with current selling prices?If the answer is that the asking
price is probably very close to the value of the cabin.
Other cabins come on the market and they are priced very
aggressively from day one.These homes are normally bank owned properties and the bank wants them gone.Homes like these come up every now and then and if you want the home, you need to be ready to offer full price.I know, you’re thinking that he’s crazy. No one offers full price in this market.Just
last week I wrote an offer for a client on a home that had been on the market for 72 hours.My clients
agreed that this house was listed at a good price and offered the bank full price for it.You would think
that they would now be in escrow but they’re not.The lost out on the house to an offer that was
written for above the asking price.
When you find the cabin in Big Bear that you could picture yourself owning, look at all of the data
that your Realtor can provide before making your offer.Don’t just assume that you’re the only
person out looking at property.
You're Free List Of Bank Owned, REO Properties in Big Bear
The inventory of bank owned, REO homes in Big Bear changes almost daily. Once a week I try and post a current
list of the bank owned homes within the Big Bear valley. This week is no diffrent,so here is the list. If you
would like a personalized list of homes more specfic to your needs,please email me at tony@tonycard.com with what you are looking for.
Five Of The Most Frequently Asked Questions I’m asked in Big Bear
I’ve been selling
Real Estate for the Tim Wood Group at Coldwell Banker in Big Bear since 2003.In this time period, I’ve
seen the market do some crazy things.In 2003 we had a strong sellers market with double digit appreciation.In those days, the days on market would average 30 days and less it was not unusual to have multiple offers on your
listings.Fast forward to 2009 and take a look at what is going on in Big Bear.We’re
in a market where home values have plummeted and lot sales are almost nonexistent. The good news
for 2009 is that homes ARE selling in Big Bear.The home values have dropped to 2003 and 2004 prices, but
as long as they are priced right, they are selling.
Listed below, are 5 common questions that I am asked by a buyer in today’s Real Estate market
in Big Bear.
How much money should I use as my Good Faith Deposit?
Real Estate is just like the weather, it
is local.What I mean by that is the information that I am providing today is what works best in the Big
Bear Valley.That being said, I always recommend to the buyer that they write a good faith deposit check
for 3% of the offered price.
When is the Good Faith Deposit Check Cashed?
In Big Bear, your good faith
deposit check is not cashed until the offer has been accepted and the escrow has been opened.Once we write
the offer on your new Big Bear cabin, the good faith deposit check is logged in and placed in a file.That
check will sit there until we have an agreement and we go to escrow.If we are unable to put the deal together,
the check is then voided out and mailed back to you.
I have noticed that the bank owned, REO property that I want
to buy has three broken windows.Will the bank make these repairs?
Generally speaking, the banks aren’t
going to spend any more money than is absolutely necessary to sell the house.My advice to my clients has
always been that if there is something that you want done in the way of repairs, then make sure that your request is in the
original offer.By placing your request in the offer, you are making it part of the offer and it must be
dealt with as the offer is negotiated.This is a better way of handling the repair compared to doing a
home inspection and then asking the seller for repairs.
What is the difference between a Short Sale and a Bank Owned,
REO property?
A bank owned, REO property is a property that has already gone through the foreclosure process and
is owned by the bank.When you make an offer on a bank owned, REO property, you are dealing with the bank.
A Short Sale is a
completely different situation.In a Short Sale situation, the home owner is trying to sell his or her
home for less than is owned against the mortgage.As a home owner, you can accept an offer on your home
for less than you owe, but the bank has the final say.If the bank is willing to accept the offer and write
off the difference between what is owned and what was offered, then the sale will go through.
People
tell me that Short Sales take forever to close.How long can I expect to be in escrow on a Short Sale,
and why does it take so long?
There is no disputing the fact that short sales take a lot longer to get approved.Banks
are doing a much better job at working with short sales than they used too and the approval process is getting quicker.If you make an offer on a short sale, be prepared for a wait.The seller will sign off on the offer
rather quickly but that is when the work starts.Providing that you already have the 3rd party
authorization on file with the bank, and then you can present the short sale package.Once the bank gets
the short sale package, it is assigned to an asset manager within a few weeks.The first thing the asset
manager does is he orders a Brokers Price Opinion. This process can take a few days to complete.Nothing
can be done until the BPO is completed, but once the BPO is complete, a decision is right around the corner.If
the decision is to accept the offer, then the escrow can open.The last time I did a short sale, I wrote
the offer in November of 2008 and we got it accepted and closed the escrow in March of 2009.Just keep
in mind, that a Short sale is not a short process. It WILL take some time.
Increase in Bank Owned, REO Properties expected in Big Bear
Banks are overwhelmed with foreclosed property and they are doing everything that they can to get them off
the books.After all, banks are not in the business of holding real estate.As the consumer,
everywhere that you look, you see advertisements for bank owned property for sale and the Big Bear market is not exempt.
As I am a Realtor in the Big Bear Valley, I follow the foreclosure market very closely.I find myself
looking at the Notice of Defaults that are published in the local paper, as well as following the foreclosure data that is
published by third party companies.I find it worth noting that the number of notices of default, notices of sale, and properties that went back to the bank in February 2009
were the highest we have seen since the tracking started in October of 2006.
What
this means is that as consumers, you are going to see an increase of bank owned properties, REO’s and short sales post
on the market in the next few months.
One of the methods that banks are using to unload their Real
Estate inventory is by sending them to auction.The auction companies publish books with page after page
of bank owned property that it is planning to be auctioned off.As I looked through one of these books
the other day, I noticed that the company publishes the starting bid as well as what is owed to the bank.As
you go through the book, you will see homes that are going to be auctioned off with starting bids of only $500.00!
Before you get too excited about the possibility of buying a home in Big Bear for
$500.00. You need to read the fine print.In most cases, the bank has placed a reserve price on the home.They can advertise that the starting bid is only going to be $500.00 but you are not going to buy the home for that
if the reserve price is $100,000.00 If the auctioneer is not able to bring in enough money to cover the reserve price, then
the bank will not sell the home, even if you were the highest bidder.
No matter what method the
banks choose to use to liquidate their foreclosed properties, there are some great deals out there for the consumer.For a free list of current listings in the Big Bear area, email me at tony@tonycard.com.
Your Free List of Bank Owned, REO Listings for Big Bear, CA
The inventory of bank owned, REO homes is constantly changing in the Big Bear Valley. Bank owned, REO properties sell
almost as quickly as they post in the Multiple Listing Service.
Below is the list of current bank owned, REO listings
as of March 16,2009 for the Big Bear Valley.
Has the Big Bear Real Estate Market hit the bottom?
This is one of the questions that I get almost daily.This question
got me thinking about the changes in the Big Bear market between 2008 and 2009.As the results are rather
interesting, I thought I would share them with you.
Let’s compare the
number of homes sold in January and February of 2008 with the same time period in 2009.
Date
Units Sold
Date
Units Sold
Percentage
January 08
30
January 09
50
67% Increase
February
08
34
February
09
57
68% Increase
As you can see from these
numbers, there has been a significant increase in sales from the same time last year.Would these additional
buyers be out buying if they didn’t think that we were at or very close to the bottom?
In January 2008, 30 homes sold... Of the 30 homes that sold, there was only 1 Bank Owned,
REO property that closed escrow.In February of 2008, 34 homes sold and none of them were Bank Owned, REO.
Of the 50 homes that sold in January 2009, 27 of them were either bank owned REO
properties or short sales.February of 2009 shows a total of 57 homes sales. Of those 57 sales, 32 of them
were bank owned REO properties.
The increase in the total number of sales
is a good indicator that we are at the bottom, or very close to it.Currently, the bank owned, REO properties
are driving the market. If you, as the home owner want to sell your home and be successful at it, then you are going to have
to compete with the bank owned, REO listing.Over half of the homes that are currently selling in Big Bear
are bank owned, REO properties.
154 Poplar is located in the Fox Farm area of Big Bear Lake. This home features
a level entry, 3 bedrooms and 2 bathrooms. Plenty of room to park your cars in this over sized garage. There is
no need to worry about storage as you get a nice sized workshop adjacent to the garage.
June
of 2005 was the last sold date on this home. At that time, it listed and sold for $349,900.00. It is now a bank
owned, REO property and the bank wants to gone. They have priced the home to sell at $264,500.00. That's
right! For $264,900.00 you cab be the proud owner of this 1480 square foot home that sits on a fenced 8680 lot.
Please email me or call for more information or additional photos.
Real Estate is local, so why don't you use a local Realtor?
If you're looking for beach front property at Newport Beach, wouldn't it make sense to hire
a Realtor who specializes in the ocean front property? What good is a Realtor from San Bernardino going to be? Is your
local Realtor going to be qualified to answer your questions about owning a home on the ocean? Are they going to know
anything about the high tide? What do you do to prepare for a big storm? These are questions that you might
want answers too. Don't you think that it would be wise to hire a specialist who deals with nothing but ocean front
homes?
If you want home in the
High Desert of the San Bernardino County, wouldn't it be smart to locate an agent in that area. An agent who specializes
in the area and knows the difference between Apple Valley and Victorville? If you have children, knowing what the
schools are like and how close they are to the home that you're interested in buying would be good information to have.
Is your out of area agent going to know this?
It's good to find a Realtor that you like and trust. He
gave you great service in the past and you made a connection with him. If that Realtor values you as a client, the best
thing he can do for you is to refer you to a specialist in the area that you want to buy.
I can't tell you how many people come to Big Bear with a list of homes that they got from the down
the hill Realtor. As the down the hill Realtor doesn't have access to the property, they send the buyer up by themselves
to view the homes. They call the local Realtor and ask to see the property, yet they want their "friend" down
the hill to represent him. Their down the hill Realtor has not been to Big Bear, has NO IDEA what is or is not a good
value, and they write ridiculous offers. If they were really interested in their client's best interest, they would
refer the buyer to a local specialist, such as myself and be happy with a 25% referral fee.
This
past week I had a Realtor call me who has a client who wanted to buy in Big Bear. He admitted to me that he had no clue when
it came to Big Bear and needed my help. He wanted to come to Big Bear, sit down with me and basically, listen as I gave
him a list of homes that he could show his client. Heaven forbid, I brought up the subject of compensation and asked
how I would be paid. He simply stated that if I was the listing agent, then I would get paid as the listing agent.
I informed him that I didn't have any listings that would work and he then wanted to know if other agents in my office
had listings that would work. The answer to that question was yes, other agents in my office did have listings that
would fit into what this guy was looking for. Yet, he was very disturbed that I would not provide that list to him.
Again, I asked how I would get paid from this and he told me that I would have to work it out with the listing agent.
Now, If I understood this guy, he wants to come to Big Bear where I can fill him in on good areas to live, tell him about
the schools, etc. He then wanted a list of homes that would fit what HIS client was looking for. And for my time
and efforts, he said that I should work it out with the listing agent.
I have a better idea. REFER
the client to an expert in the area. That is the best thing that you can do for your client. For God's sake, Don't
be so greedy! Just for once, think of what is best for your client!
1005 Sequoia is the least expensive 3 bedroom, 2 bathroom
home in all of Big Bear City. The last time this home sold was back in June of 2006. Back then, it sold
for $265,000.00 The bank needs it sold and has priced it accordingly. You can buy
this home for $149,900.
The cabin features a large kitchen with a work island in the center of the kitchen. Buy some bar stools
and use the center island as an open eating area.
The house has the master bedroom and one additional
bedroom on the main floor. The third bedroom is upstairs, adjacent to the loft.
This is a bank owned, REO property. This
means that you will be getting the home below current market value, but it is also sold as is.
Short Sales in Big Bear Lake, CA. Are they Really A Good Deal?
Back in November of 2008 I wrote an offer for a home that was being offered as a short sale. In
December of 2008, I wrote another for a client on a home that was being offered as a short sale.It is
now March 4, 2009 and both of the escrows will close today.I know one of my clients knew that the short
sale process would take some time but the other client was clueless.Before writing the offer in November,
I explained the short sale process to my client and asked him if he was sure that this was what he wanted to do.When I told him that the short sale could take some time, I don’t think he really understood just how much time
we were talking.
How much are you really saving when you buy a home listed as a short sale?
Three days before the short sale closed, the property next door came on the market for what appeared to be
a fantastic price.The home is being offered for $15,000.00 less than my client paid for his and the new
listing has twice the square footage.At first glance, it looked like my client is now paying too much
for his home, but you needs to get past the first glance.Once I took a look at this property, it was clear
why it was being listed at such a price.The house is in shambles and is going to need $25,000 to $30,000
in repairs.
While the Big Bear market is a resort market, it has not been insulated from
the current economic developments. Values have dropped and homes are selling for prices that we haven’t seen since 2003
and 2004.
That being said, I would be very careful before getting involved
with a short sale here in Big Bear, or anywhere else for that matter without having some buyer protections built in to the
contract.The last thing that you want as a buyer is to be under contract on a escrow that won’t
close.The wonderful deal that you thought you were getting on that cabin in Big Bear could end up costing
you more than it’s worth if the escrow goes on too long.
As a member of Chuck Hurd's Real Estate Group, my goal is to demonstrate that professionalism truly
exists in the real estate industry, and my commitment is to prove this with every time we speak. Please enjoy my site,
and please don't hesitate to contact me if I can assist you in any way.
floor. The third bedroom is upstairs, adjacent to the loft.