Rostad Realty

Here is an excellent way to pick and chose where you would like to live in Seattle if crime is high on your list of concerns. Take a look at the map. Some of the results may surprise you regarding where the crimes are actually taking place. The map was running a little slow for me. I’m guessing the city didn’t plan for the high demand of such a page. Here is the link to the map.  Here is another blog with more information.

Windermere has typically been one of the few brokers who could offer bridge loans.  Recently they launched an even better offer to give qualified buyers a bridge loan of up to $100k for six months at 0% interest or $200k for 3 months at 0% interest.  This is an excellent deal if you currently have a home you need to sell before you buy a new one.  Here is an article from the Seattle Times with more details.

On any given Monday there are approximately 400-450 homes scheduled for Friday’s foreclosure auction on the King County Courthouse steps.  On the 2nd Friday of September there are over 1100 scheduled!  There will not be enough investors and some of the homes will sell for $1.00 over minimum bid.  Not to say this is the last time we will see this volume but it is certainly worth sitting up and taking notice.  The banks are finally cutting some of these properties loose.  If you are looking to build up your rental portfolio, this is an excellent opportunity.  If you need help financing a property at the auction, we have some resources.  Give us a call.

I recently went to a class about selling listings in a slow market.  It was a course on blogging, internet marketing, listing syndication, etc.  Great class but perhaps more important was something I learned there about the extent of the new HVCC laws.  Sponsering the class was Mike the Money Man Mike Carpenter who prefaced the class with a summary of the new appraisal laws which are supposedly put in place to help people but in the end, all it’s doing is making a few companies rich, bloating the appraisal process and making it very questionable if your financing is going to fall apart or not.

Mike has generously posted many more details about this “great appraisal conspiracy” on his website.  The punchline is, the more beuracracy and layers of absurdity you add to the process, the longer any housing recovery will take.  This law went into effect on May 1st, 2009.  It is too early to see the effect this will have on the market but I can predict it will not be good.

Mike has several action items posted in his article that you can do to hopefully help get this law repealed.  I urge you to follow up with them but let me get you started.  Please sign this petition.

I have recently been invited to contribute to Zillow’s own Geek Estate Blog.  The topic is internet marketing by tech savvy real estate agents and they thought I would be a good fit.  I am adding a feed to the sidebar on Rostad Realty that will allow you to follow my activity on the Geek Estate Blog.  If you want to see ALL of my posts, click here for my Geek Estate Blog profile.  I urge you to check it out since it will give you some insight on the way I do business and some of the various techniques I use to market properties for our clients.  I’m always trying out new methods and technology as well so check back often because the lansdscape of internet marketing is constantly changing.

Geordy Rostad, SamDeBord, Geordie Romer & Sunnyview (left to right)

I was invited to join the team from Zillow for lunch on May 14, 2009.  I had no idea what to expect.  For the couple of weeks prior to lunch I wondered if I was the only one they invited or whether they had invited every real estate professional in the area they could get their hands on.  I had a suspicion they would invite Sam DeBord.  He is another agent who is extrememly active on the Zillow discussion forums.  I had assumed that is where they culled their guests from.  The surprise came when I showed up and met Geordie Romer in person.  He is not overly active on the discussion forums because Leavenworth, WA, his area of expertise, has no Zestimates yet even(At the meeting, it sounded like they were coming though).  Geordie had met Spencer Rascoff at a REBar meeting and had a bit of an idenity mixup.  Spencer had put us in contact because we both have a unique(so I thought) name and we both work at Windermere.  Lastly, but certainly not least, Zillow invited Sunnyview, a helpful non-professional Zillow user with over 7600 postings to date.  She does this purely for the love of real estate and helping people out.

Our meeting started with Spencer introducing us to at least 10 Zillow gurus who would soon be picking our brains for our perspective of Zillow.  He prefaced the meeting with, “we have no specific outline for this meeting”.  Nevertheless, I think it was a mutually beneficial meeting of the minds.  I gained a bit more insight about where Zillow is planning to end up and thought seriously about new ways to integrate their tools into my arsenal.  They gained some great suggestions from the four of us which I hope they implement soon.  (I understand if it takes a bit guys, the list was long)  The bonus was that I met several people face to face that I had cooresponded online with in the prior months.  This can be a rare opportunity nowadays.

Thanks for lunch!

http://www.zillow.com/blog/talking-to-a-few-local-zillow-advice-regulars/2009/05/14/

This is a disturbing new development in short sale transactions.  I have not personally seen this myself yet but I believe it is around the corner.  The Following post was a question answered by the Washington Association of Realtor’s legal hotline:

Question:
Despite negotiations by seller’s lawyer with seller’s short sale lender, short sale lender still insisted that seller carry back a personal obligation for released debt. Short sale lender was non-negotiable on this issue. Is there a new trend in this direction? Seller chose not to proceed with the short sale and is letting the property go to foreclosure.

Answer:
Yes. A new trend is developing in which short sale lenders are establishing policy statements that short sale sellers will not be forgiven of personal liablity for any debt released during the short sale. In other words, some major institutional lenders appear to be adopting across-the-board policies refusing to discharge sellers of personal liability. What this means is that these sellers will necessarily continue to be liable for the amount of debt released by the lender to allow the short sale transaction to close. While it cannot be said that every short sale lender has adopted this policy, it appears that several of the major, institutional lenders have adopted this policy.

The end result for sellers in this position is that their lender could sue them (or otherwise attempt to collect the funds) for six years following closing of the short sale. There is a six year statute of limitations on a written contract. The lender could also sell its rights to collect the debt to a third party who could pursue seller. If a judgment is ultimately taken against seller, the judgment will attach to any real property owned by seller (conceivably any real estate owned by seller in any state). A judgment is valid for up to 20 years.

As this seller chose to do, many sellers will refuse to sell the property under these terms. The alternative choice is that the property will be foreclosed which, depending on other facts at issue, will be preferable to many sellers. REALTORS should be aware of this developing trend and make even more of an effort to get sellers to legal counsel for assistance in negotiating and understanding the short sale agreement. Under no circumstances should REALTORS take responsibility for advising sellers as to the merits of signing or declining a short sale agreement.

The way in which many lenders are effectuating this ongoing personal liability is more subtle than stating specifically that seller will remain liable. Some lenders are simply choosing to remain silent, in the short sale agreement, with respect to ongoing liability for the released debt. The effect of that silence is that seller remains liable. Here is how that works. Recall that seller signed a promissory note and a deed of trust when the loan was taken. In the short sale transaction, the deed of trust is released from title to the property but the promissory note remains as evidence of an obligation from seller to lender. The amount owing under the promissory note is reduced by the proceeds of the short sale, but the remaining amount remains an obligation of seller to lender. Unless seller is specifically discharged of all obligation to repay the promissory note, seller remains liable for the unpaid balance.

Aside from the obvious risk to sellers, the real world difficulty presented by this scenario is that there is almost no way for REALTORS to manage this issue without incurring significant lost time and expense for everyone involved. If lender does not clearly indicate its intention in this regard to seller prior to seller marketing the property as a short sale, then what will happen is that seller and listing agent will market the property, buyer(s) through their agent(s) will offer to purchase the property, an offer will be accepted, buyer will pay for and conduct inspections, appraisals, credit reports, etc., escrow will set up an account, title will issue a commitment, etc. and when the short sale agreement is finally produced and the personal liability issue is made clear to seller, seller is likely to refuse to close the transaction making a waste of everyone’s time and expense.

This is a dangerous trend for everyone involved. Sellers are taking significant risk in selling their property short without a complete discharge of their obligations under the note. Buyers are taking a risk in spending time and money moving toward closing of a short sale purchase. REALTORS risk losing the value of their time participating in these transactions. And the short sale lenders themselves risk a whole lot of sellers choosing to allow their properties to go to foreclosure, where the lender still will not recover the deficiency, many of the properties will be substantially damaged in the process of foreclosure and the lenders will then have to find their own buyers for the properties at whatever value remains in the property. Hopefully, the negative effects of this trend will reveal themselves to the lending industry immediately and short sale lenders will reverse this policy. Until then, REALTORS must be certain to advise their short sale sellers, in writing, to seek legal counsel for assistance in understanding and determining whether to sign a short sale agreement.

The Legal Hotline lawyer does not represent Washington Association of REALTORS® members or their clients and customers.