Category Archives: Real Estate

Real Estate

Tom Sullivan, Investment Advisor, Faces Foreclosure

Tom Sullivan
Tom Sullivan

So how is it that an investment adviser and commentator like Tom Sullivan is facing a potential foreclosure on his home in Placer County?  Shouldn’t someone who is an investment adviser know not to buy more than he can chew?

I guess you can blame the downturn in the economy for the majority of people who are now facing foreclosure.  Many of them were lured by banks into taking out loans at low interest rates that increased to exorbitant rates in two years, making it impossible for the homeowner to continue making their mortgage payments. But, it’s hard to understand how a financial advisor can fall into such a trap, especially when he is working full time.

Here’s a portion of the story from the Sacramento Bee:

“The longtime Sacramento investment adviser and commentator, who now works for Fox Business Network, is attempting to unload his former Granite Bay home in a short sale after being threatened with foreclosure.

Sullivan and his wife, Caroline, have listed his five-bedroom, Mediterranean-style house on Wexford Circle for $1.15 million. They paid $2.5 million for the home in 2004 and took out a $1.6 million mortgage, according to Placer County property records and MetroList Services Inc.

Sullivan moved to New York in 2007 to become an anchor on the Fox Business Network.

The Sullivans missed their first mortgage payment last October, according to Foreclosures.com. The research firm says Chase Home Finance issued a default notice on the 8,200-square-foot home four months later, in February.

The default notice was the first step toward foreclosure. The Sullivans would avoid foreclosure if the short sale goes through, but all the proceeds from the sale would go to the lender, and the Sullivans would get nothing.

In a short sale, the lender lets the home sell for less than what’s owed on the mortgage. But a lender can reject short-sale offers.

Sullivan, in his written statement, said he’s presented “a number of offers from buyers to the bank and they have rejected them. At this time we are still submitting additional offers and (are) awaiting the bank’s decision.

“I stand to have a significant loss on the sale, as many people have had in this depressed real estate market,” he said.

MetroList records show that Sullivan first tried to sell the house in 2006, asking $2.9 million before the market collapsed.

Sullivan is one of several high-profile Sacramentans to run into personal real estate problems in recent months. Former Kings basketball star Ron Artest finalized a short sale on his Loomis home recently. His ex-teammate Kevin Martin, facing a possible foreclosure on his former home in Rocklin, is attempting his own short sale.”

Sullivan made his early reputation in Sacramento as founder of the Sullivan Group financial-planning firm 26 years ago. He hosted a popular financial and general news show on radio station KFBK (1530 AM), provided financial commentary on KCRA-Channel 3 and wrote an investment advice column for The Bee.

Besides anchoring a TV show for Fox Business, he hosts a weekday Fox radio program.”

To read more: Click Here Sacramento Bee

Real Estate

A Little Known Loan Program for Fixer-Uppers


Home buyers thinking of purchasing a distressed property in need of repair, but who are concerned that the cost of the repairs could drain their savings account may qualify for the Federal Housing Administration’s (FHA) 203(k) rehabilitation program.

MAKING SENSE OF THE STORY FOR CONSUMERS

  • The FHA’s 203(k) rehabilitation program provides loans for covering renovation costs as well as the purchase price of the primary residence.  Investors are not eligible for this program.  Additionally, similar to traditional FHA loan programs, the rehab program allows for a down payment of as little as 3.5 percent.
  • A common misperception about the program is that the house needs to be unlivable.  Realistically, the property just needs to be outdated, according to a lender familiar with the program.  The property “just has to appraise below market value and then at market value with the repairs.”
  • Improvements deemed “luxury” are ineligible; however, the program has a wide range of definitions for “repairs” and “modernization.”  Covered repairs include items such as a new roof or heating system, as well as decorative changes, like replacing vinyl with ceramic tile on the kitchen floor or painting the interior.
  • In addition to putting down at least 3.5 percent of the current value of the property, buyers also must use a HUD-approved lender, appraiser, and a contractor approved by the lender for the repairs.  One list of approved businesses can be found at 203kcontractors.com.
  • Borrowers considering the FHA rehab loan program should be aware that loan rates typically run around a percentage point higher than conventional loans, and come in 15- to 30-year terms, either fixed or adjustable.  Additional paperwork for inspection, appraisal, title updating, and the like can increase closing costs by $1,000 or more higher than the average.
  • For additional information about the FHA 203(k) rehabilitation program, please visit http://www.hud.gov/offices/hsg/sfh/203k/203kabou.cfm

Read the full story.

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Real Estate

Another Craiglist Real Estate Scam

A crook with a computer has stolen an online listing from an Ames real estate company and is posting it on Craigslist as a rental, asking people to wire hundreds of dollars overseas, according to local and state sources.

Hunziker & Associates agent Tabitha Zesch said the property — a single family home priced at $129,900 — has been posted as a rental on Craigslist.

The scam artist put a story on the web page, “saying that the owners had been transferred overseas, that the property rents for $700 a month and that if anyone wanted, they could wire a deposit to hold the property,” Zesch said.

Zesch said her company became aware of the fraud only because a potential renter got suspicious, tracked down Hunziker as the listing agency and e-mailed her office.

She said her company notified state and federal authorities and alerted Craigslist, but that the listing was still there late Tuesday afternoon.

Bill Brauch, director of the consumer protection division for the Iowa Attorney General’s office, said scams like this one “are fairly common.”

“If you’re selling a home or some real estate online, (the crooks will) duplicate the ad and set up a scam of their own,” he said.

Source Ames Tribune

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Real Estate

Improve Your Credit Score Before Searching for a Home

By Paige Tepping

RISMEDIA, October 16, 2010–Many prospective homeowners find out the hard way the importance of a good credit score when they apply for a home mortgage, especially after the subprime loan crisis. If you are considering buying a home in the near future, it is a good idea to give your credit score a check-up and then take positive steps to improve your credit score if you find problems. Ideally, it is best to begin working on improving your credit score at least six months before you plan to start shopping for a home.

According to the experts at Buy-and-Sell-House-Fast.com, the following tips will help you improve your credit and should be taken before you begin your home search.

The first critical step in taking care of your credit is to check your credit report. Unfortunately, many people fail to take this all important first step. Instead, they wait until they have applied for a mortgage loan to find out from the lender that there are problems with their credit scores.

By checking your credit score before you apply for a mortgage loan, you gain the opportunity to find out if there are problems which you can correct and discrepancies that need to be removed. When you check your credit report, make sure you check all three of the national credit reporting agencies: Experian, Trans-Union and EquiFax.

Review your credit report carefully for items that may be erroneous. If you believe that an item on your credit report is reported in error, you have the right to contest it. To do so, you will need to contact the credit reporting agency and explain why you believe the item is inaccurate. Supporting documentation such as receipts and cancelled checks can help your claim. Alternatively, you can engage a credit report repair services firm to fix your credit report.

To read the full story Click Here

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Real Estate

California Realtors® Forecast Slight Rise in 2011 Home Sales


Sales of existing, single-family homes are expected to decline slightly in 2010 compared with 2009, but are forecast to rise slightly in 2011, according to the CALIFORNIA ASSOCIATION OF REALTORS®’ (C.A.R.) “2011 California Housing Market Forecast.”  Meanwhile, the median price of homes in California is expected to increase both in 2010 and 2011 compared with the year prior.

  • Following near record-high levels of year-over-year sales increases, home sales are expected to decline 10 percent in 2010 compared with 2009, according to the C.A.R. forecast.  C.A.R.’s economists predict home sales will increase 2 percent in 2011 compared with 2010.
  • Home sales are expected to end the year at 492,000 units, compared with 546,500 in 2009.  C.A.R. forecasts sales will come in at 502,000 units in 2011.
  • The median sales price is forecast to increase 11.5 percent to $306,500 for 2010, and an additional 2 percent in 2011 to $312,500, C.A.R. announced.
  • According to C.A.R. Chief Economist Leslie Appleton-Young, the Association expects a net jobs increase of approximately 1.4 million jobs in California for 2011 and an improvement in unemployment figures, which many believe are key to the economic recovery.
  • Ms. Appleton-Young also noted that a lean supply of available homes for sale will drive up prices at the low end ($500,000 and less), but larger inventories and limited, less-attractive financing will cause continued softness at the high end of the market ($1 million and more).

Read the full story.

John J. O’Dell
Real Estate Broker
General Contractor
Call 530-263-1091

Construction, Real Estate

Buying a Home, Beware When Home Lacks Permit

How about this house, think it was built with a permit? :-)
How about this house, think it was built with a permit? :-)

By Paul Bianchina

It’s an all too common situation. You find a perfect home for sale in an ideal neighborhood. It’s been beautifully remodeled, and it has everything you’ve been searching for. Even the price is right. Something tells you it might be too good to be true, but you put in an offer anyway, and it’s accepted.

You start doing all the paperwork, and sure enough you discover the catch that you always somehow suspected was there. The sellers did all of that remodeling work without any building permits.

So now you’re faced with a dilemma. You really want this house. The sellers insist that all the work was done by licensed contractors, and that they have full documentation and photographs of all the work as it was being done.

The sellers also tell you that they’re willing to allow any type of inspection on the home that you’d like — except for one by the city.

They explain that they had a bad experience with a building inspector on a previous home, or that they have an ongoing feud with the city over their water bill, or they’re protesting the fact that the city hasn’t fixed the pothole on Main Street yet, or some other reason that they refuse to become involved with the local municipality.

Continue reading Buying a Home, Beware When Home Lacks Permit →

Real Estate

Some of the Wealthiest People Just Don’t Get It in Real Estate

There is a very interesting article in the Wall Street Journal recently. It seems that some of the wealthiest people are caught up in their emotions and will not lower the price on their mansions. For example here’s an excerpt:
“Some holdouts and their brokers defend their prices, arguing that their estates would be difficult, if not impossible, to replicate today. “I feel the property is worth every penny—and probably then some,” says Tommy Hilfiger co-founder Joel Horowitz, who has been asking $100 million for his 210-acre estate in Zephyr Cove, Nev., since July 2006, when the National Association of Realtors’ then-Chief Economist David Lereah said that housing appeared to be headed for a soft landing in most markets.

Mr. Horowitz notes that he and his wife Ann spent a year designing the home and three years building it and bought items for the home on their travels before it was even built—including lighting fixtures, fireplace mantels and 400-year-old flooring from French châteaux.”

I’ve heard that argument for not lowering the price on a home so many times. Sad to say, the market does not care how much love, care or money you have put into a home, the market still dictates what a home will sell for. Until one comes down to reality, and lowers the price to meet the market, the home just will not sell.

To read the full article in the Wall Street Journal, Click Here.

John J. O’Dell
Real Estate Broker
General Contractor
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Real Estate

Short Sale Fraud Cases Rising

SACRAMENTO, Calif.–(BUSINESS WIRE)–The California Department of Real Estate (DRE) has reported a sharp increase in the number of cases involving short sale fraud. In response, the Department has issued a new consumer alert detailing the perils and pitfalls of short sales and has begun posting its administrative actions filed against violators on the DRE web site to help consumers avoid the short sale culprits.

“Hopefully with the new Consumer alert and other educational efforts we can curtail the fraud”

One year ago, DRE investigated fewer than 10 cases involving short sales. Today the case load has increased to over one hundred and the number is growing.

“We saw a similar ground swell with the loan modification scams,” said Real Estate Commissioner Jeff Davi. “Hopefully with the new Consumer alert and other educational efforts we can curtail the fraud,” Davi added.

A short sale transaction involves the sale of a property that is less than the amount of the mortgage loan(s) on the property. In order to complete the sale, the seller requests the lender accept less than what is owed in order to allow the transaction to close. While short sales are a popular alternative to foreclosure, like all real estate transactions, they are complicated and sellers need to lookout for the pitfalls and red flags.

Consumers need to take particular care with the representatives they hire to negotiate short sales and be especially leery of any upfront fees. With limited exceptions, short sale negotiators need to be a licensed real estate broker or salesperson working for a broker. Before engaging the services of a person or entity to negotiate a short sale, check out their license status on the DRE’s web site. In addition, consumers should not pay anyone wanting an advance fee without checking with the DRE.

Again, with limited exceptions, demanding payment upfront for short sale negotiation services is illegal. Finally, sellers and buyers should be cautioned that any payments that are not clearly disclosed in the escrow and closing documents is a red flag and an indication of fraud.

A few of the key elements a homeowner should look out for are the following:

* Do not pay an advance fee to a short sale negotiator without checking with the DRE.
* Short sale negotiators must be licensed real estate brokers (or a licensed real estate salesperson where that person is working under the supervision of his or her broker).
* Any and all payments must be fully disclosed and made part of the escrow documents. If there are any fees to be paid “outside” of escrow, this may be the red flag that the payment is illegal.
* If your agent explains that the buyer is a fictitious person or entity, or your buyer is purchasing the property under a power-of-attorney or is a limited liability company (LLC), this may be a red flag that fraud is involved in your transaction.
* If you are told that an unlicensed processor, negotiator or facilitator is handling your short sale, this is a red flag that unlicensed activity is taking place. Only real estate licensees, California lawyers acting as lawyers and investors acting on their own behalf can engage in short sale negotiations.
* Be wary and cautious when thinking about retaining the services of people or companies calling themselves “specialists”, “experts”, or “certified” in the area of short sales. View the claims of expertise, certification, and specialization with a critical eye, verify the claims, and ask specific, detailed questions.

For a copy of the alert and list of actions involving short sales and other consumer tips, visit Department of Real Estate and click on the Consumer Tab.

Real Estate

California Home Sales Drop in August Compared with Last Year


The median home price of an existing, single-family home in California rose 1.2 percent compared with July and 8.6 percent from a year ago, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported this week.  Following two months of consecutive month-over-month declines, California home sales edged up 1.8 percent in August compared with July, but were down 14.9 percent compared with August 2009.

  • According to C.A.R. President Steve Goddard, home buyers who are waiting on the sidelines should consider the opportunities available in today’s market.  Favorable home prices and interest rates at or near historic lows make housing affordability the best in recent years.  Anyone who is in a position to buy a home should do so before either of these key factors rise.
  • The statewide median home price posted its 10th consecutive year-over-year gain in August, according to C.A.R.’s report. The median price of an existing, single-family detached home sold in California during August 2010 was $318,660, an 8.6 percent increase from the revised $293,400 median price recorded in August 2009. The August 2010 median price was up 1.2 percent compared with July’s $314,850 median price.
  • C.A.R. Chief Economist Leslie Appleton-Young says California’s housing market is transitioning from the conclusion of the federal home buyer tax credit and that home sales are strongest in the higher-price range.  The strength in the upper-end market combined with inventory levels that are higher, but still lean by average, has led to home prices holding steady.
  • To hear more from Ms. Appleton-Young, please visit http://videos.car.org/mediavault.html?menuID=1&flvID=10.
Real Estate

Jerry Garcia’s Home up for Sale for $3.995 Million

If the walks could talk, the stories would be as riveting as your favorite Grateful Dead song to say the least! This single-family residence located in Northern California’s Marin County is the same house that Grateful Dead bandleader Jerry Garcia owned at the time of his death in 1995.

The Mediterranean-style house has more than 7,000 square feet of living space and sets on an 11-acre spread that looks out onto the Pacific Ocean and Mount Tamalpais. The celebrity once-owned property is listed at $3.995 million. It is in Nicasio, Calif., which is approximately 30 miles north of San Francisco.

The Grateful Dead has one of the most loyal and largest fan base in musical history. Jerry Garcia, the band’s beloved late leader, is a member of the Rock and Roll Hall of Fame and is on Rolling Stones’ 100 Greatest Guitar Players of All Time tributary list.