Foreclosed houses....

[Pat Whatley]

The first house I ever bought was a great little house. I worked on it constantly, laying tile, painting, refinishing hardwood floors, and building a deck. It was a small house in a neighborhood full of small, starter homes. Just an all around great place to live. Two years after moving in I got married, we sold the house for a nice profit, and moved into a much bigger house in a different area.

The couple we sold the house to was a really nice couple with a 2 year old kid. The wife literally squealed when we accepted their offer and hugged everybody at closing. They financed the house and managed to add $5000 to the loan amount so they could buy all new furniture (no, that wasn't smart). Even at that their house payments were an easy $510 per month.

Drove by there a couple of weeks ago and there were three foreclosure notices nailed to the front door. Today I saw a realtors sign in front of it, turns out its on the market for HALF OF WHAT WE SOLD IT FOR.

Now I know the market has tanked but a lower priced house shouldn't drop that far. I just got back from looking at the house. The carpets in the bedrooms look like they never got vacuumed...they actually look like they were parking cars on them because there are weird stains all over them and the walls. They ripped out the kitchen cabinets, all the appliances, the knobs off the shower. All of the trim is filthy, the hardwood floors that I left almost perfect are practically destroyed. Front door is screwed shut, somebody had drilled out the deadbolt on the back.

I bought the house for $74,000, sold it two years later below market value at $95,000....Fannie Mae is trying to dump it for $45,000 and would probably take $38,000 for it.

I told the realtor I couldn't believe it was still on the market that cheap. He said that three years ago they would have sold it in a week, in today's economy the market is saturated with them. When I asked him about the condition he told me that almost all of the foreclosures he deals with are in WORSE condition, especially the cleanliness. We went and looked at two other foreclosures in the neighborhood and the absolute filth just astonished me.

I can kind of understand somebody being evicted selling every appliance they can get out of the house. I can understand not sweeping up after you (or the Sheriff) moves all your stuff out, but there's no excuse for pure grunge.

My point is, well there's not really a point. I'm just shocked at the condition of my cute little house, shocked that people can live in filth, and unbelievably shocked at how cheap Fannie Mae is trying to dump foreclosed houses.

Seeing how people treated the house they'd bought killed any enthusiasm I had for buying it and turning it into a rental house.

 

[Bradster941]

Yup, don't do it.

Renters have no invested interest so they simply don't care.

(Especially if they are in there 20s or 30s)

Every one else suffers;

the neighbors
the property owner
often, the tax payers due to section 8

Going through the same ( #1 ) thing right now with a scum bag banger.

Pretty sad when you totally expect to be fire bombed or worse one night.
~and I live in May-berry USA~

or at least I did till scum renters moved in.

My tax dollars at work, 'oh Joy...

 

[Baz]

It's laziness! It's people who have not been taught to be responsible! It's disgusting!

 

[Flame]

It's laziness! It's people who have not been taught to be responsible! It's disgusting!

Amen. When I moved out of my rental, I vacummed twice, polished the stove and swept out the garage.

 

[TheSnowman]

Yep...our culture is...it's not my problem, it's someone else's...so I might as well just destroy it. We had a house that wasn't even one year old next to us built, and in that one year, the mom was home maybe...6 times that I saw. A brand new house went to complete trash and we are in a neighborhood of newer families, but people that actually take pride in their stuff and don't let it get trashed because they are lazy.

When that house got foreclosed on, the buyer had to replace all floors, fixtures, bathroom fixtures, counter tops, holes in the drywall, re-paint, and new doors and trim through out. They set off something like 10+ bombs trying to kill all the flea's that were in there from the dog. I just can't imagine living in that kind of filth. My house isn't perfect by any means...but taking an hour or more a day to take pride in something that is yours isn't gonna kill you. It's sad.

 

[Baz]

Don't you feel good when you finally sit your ass down in front of the tv with a beer knowing you just cleaned up something. Living in a clean space is just good for the soul ... Kinda like a Feng Shui thing ...

 

[Jillbeans]

Ever watch Hoarders?
Love....Jill

 

[Letterbox Mike]

Been there too. My wife and I looked at a fantastic house out in the country last year. It was a 4 BR house with a nice barn on about 6 acres. In a good economy it would sell for $300k+ easy. It was in foreclosure and for sale for $149k. On the outside it was perfect. Inside it was literally destroyed. The kitchen was gutted. The carpet was pulled up and sold. The hardwood flooring and trim was removed and sold. As much wiring they could get out of the house was pulled out and sold. All fixtures, door handles, and most doors were removed and sold. What really got me though was after all that, they poured dry concrete down all of the drains and toilets to ruin all of the plumbing. OK, I can see being so desperate for cash that you gut your house and sell it for scrap (well, sort of). But what's the point in ruining the plumbing? Just to stick it to the bank for evicting you?

We're also looking at a 10-unit apartment building as an income property. We've toured most of the units and it's unreal how people live. Granted they're not high-end apartments and they are not being rented to doctors or lawyers by any stretch of the imagination, but it never ceases to amaze me how so many people lack even basic hygiene and sanitation skills. People are just plain disgusting. Damn, I can't sleep at night if I leave the morning newspaper out on the table. It looks like some of these people have never cleaned since they moved in, and since moving in they've rebuilt a dozen cars in there... Unreal.

 

[John L]

Wish I had better news to report. Thinking it would be close to home and easy to keep an eye on, I bought the next door neighbors house from their creditor 8 months after their foreclosure. This was a beautiful home 2 years before, I had bought and sold the place once before, about 12 years ago. It was an absolute dump by the time I bought it this second time. I rebuilt the damage and made it very nice again, I have owned it a year again now and have gone through 2 tenants, with a full repaint required and several serious repairs after each removal. Deductions are only good if you are making money on your investment.

 

[Gino]

Went through he same thing about 24 years ago, Pat.

I bought my grandfather's house in 1974. It was in our family since 1920 or so. Had fond memories of it as a kid and then when I bought it... I brought it up to code, painted, built and replaced just about everything in that house. Get a load of this... when I bought it... it had a 30 amp service coming into the house. Moved out in 1986 and we never saw the couple that bought it. We were told not to show up at settlement. We didn't mind... we got more than our asking price. Anyway, within 6 months, the placed looked like total crap. After a year we heard through old neighbors that the couple trashed the place and skipped out owing a whole lot of money. Turned out the people were from Nigeria and were used to doing this. They stayed one step ahead of the law, somehow. I looked at all the delicate painting work my Dad and I had done to all three stories and the window treatments and just had a sinking feeling about the old homestead. I actually felt like I felt my relation down for letting this place go to pot. I went by a a few years ago and it looks like one of those places you see on television with windows knocked out and doors open and just plain run down. It's sad to see how things that lasted for 100 years or more are completely ruined in just a few months to years. Whole neighborhoods gone to crap. I don't feel safe going through that part of town.... even heavily armed anymore.

 

[Bigdawg]

Well... I live in one of those neighborhoods that has gone downhill. We are fighting though and struggling to make it what it once was. A lot of houses are abandoned by not only resident owners, but rentals that are in foreclosure.

A mobile home park across the street that was some of the cheapest housing in town was closed down several years ago. Like 30 days notice... all y'all get out now. Three-quarters of 'em were scum that deserved it. The other quarter were hispanic and white families that just couldn't afford the outrageous rents down here.

So the scum moved into the trailers that border the front of our little neighborhood. Followed by prostitutes, drugs and lots of thievery. We are on the very line between county and city. The attitude by the police was that we deserved whatever happened to us over here - if we could even get them to come out and take the complaint. 25 years ago when my family - moved into this neighborhood it wasn't like that. But as a neighborhood deteriorates so does the police response.

Those renters - for the most part - are now gone... it took a lot of work to clean up our little neighborhood. And we're not done. But the ONLY way it worked was when we started holding the landlords legally and financially responsible for the problems their tenants were causing. Not unreasonably so... but dammit... if you own property, drive by it once in a while and LOOK at it. Make friends with the permanent families that are there... we look out for each other and we'd look out for them too. We had people that pushed it with the county commissioners to help us clean things up. It worked.

I am NOT blaming landlords for what the tenants do inside the house. But if the police are making visits regularly... you might want to consider taking a look. If the outside is trashed... it's a pretty safe bet the inside is too. I've rented most of my life - I don't want a landlord that snoops - but I have never minded a landlord that collected his rent at the door so he could check on his property. It just makes sense to me.

I sometimes understand the despair and loss some of my neighbor's went through before they lost their homes. They didn't care any more and it showed. Not that I condone trashing a house, but I think some of them hit a point that it really doesn't matter any more...

and then again, some people are just friggin' pigs.

 

[tomence]

It's funny how the banks operate. I just watched a show today where a guy bought a house 10 years ago for $100 000. He invested in the house almost another $100 000 and the value of the house went up to $250K 2-3 years ago. Now the market value for that house is under $100k and this guy now stoped paying since 6 months ago. So he owns $250k but is not paying, the bank foreclosed the hosue and put the house for sale at under $100k so this guy goes to the bank and offers $150k to buy it back, but the bank won't let him have it.
So whats up with that.

 

[Pat Whatley]

He owes the bank $250,000. If they take $150,000 from him they lose $100,000.

If they take $90,000 from somebody else they still get to go after the guy for the other $140,000.

After doing some research tonight and talking to a mortgage broker friend of mine I'm going to offer $28,000 for the house tomorrow. If they counter with anything below $36,000 I'm going to buy it, remodel it, and try to flip it.

 

[tomence]

They can go after him but i don't think he will ever pay them back that kind of money. He lost too, now he is trying to work something out with the bank but i guess there is no options for him. It's too bad for somebody that lived there for 10 years now to lose everything. Probably he paid good amount of money during that period.

 

[G-Artist]

I got two of those houses on my street. One right next door. Talked those folks out of trashing the place.

Some major cities are PAYING folks to NOT BURN their houses after getting an eviction notice.

Good luck even getting a response from a lender / mortage holder on a bid.

Here's the deal. The banks and other lenders layed off 100's of folks who ran the mortgage deartments. There literally is no one who can give you an answer or who will give you one - at least not for months.. And that is nation-wide even if the lender has a local office.

Cities and towns are going broke because they are over-budget in the code enforcement area. They go in and mow, drain pools, etc. and all they can do is lien the property. The only leverage they have is that property can't be sold/transferred until the lien is satisfied. That can take and will take years in many cases.

Condo and Homeowners associations are going belly-up for the same reason.

It's rough out there. More than you know.

 

[Salmoneye]

What we need are some DA's that will actually start prosecuting these criminal vandals for destroying rent houses and houses that basically now belong to the banks. Someone that torches or tears up someone's property just because they couldn't afford it or made a poor decision is nothing more than a criminal. They should clean the place up and leave an apology note before they pull out (long before an eviction note could ever arrive).

 

[John L]

They can go after him but i don't think he will ever pay them back that kind of money. He lost too, now he is trying to work something out with the bank but i guess there is no options for him. It's too bad for somebody that lived there for 10 years now to lose everything. Probably he paid good amount of money during that period.

Yep, he probably did pay out a lot. It really sucks. One of our suppliers has a delivery guy that had the very same situation. He says he moved 1100 miles away and had the local sheriff knock on his door to take inventory of a rented apartment.

If your friend is still a working man, there's usually not much hope to skip out there. The bank will likely sue him and win a local judgement for the balance, plus interest, plus penalties, court costs, attorneys, etc. With the judgement, they will be patient in the pursuit but anytime something turns up in his name in that county, in that state, or any state or municipality that recipricates the judgements they will find him. Buried in that stack of settlement papers was probably also a clause relating to the fact that they will run periodic credit checks and public record searches on him. Depending on the state, it may not be possible to start anew without satisfying that bank first.

 

[binki]

Come to the California. Some towns have 50% or more of the houses in foreclosure. Mostly in newer developments.

One crime ring had 51 houses, never lived in, that were used for illegal indoor growning operations.

On top of that the refi market around here was criminal in nature with housing prices in some areas increasing by 600% over just a few years and crashing about 2 years ago.

We just purchased a 'new' house that was an REO and half of the 400 houses in the development are REO or soon will be. They are selling for less than half of what they went for new and the 5th developer in the area is still selling new ones.

 

[tomence]

Talking about criminals. I think the banks are the biggest criminals, they try to squeeze the last cent that you have in your pocket, screwing you in every possible way they can, but when it comes to you when you need something to take care of coz of the bank's mistake it will take a while, they always have excuses and always are the good guys. We as people in their eyes are dollar signs, not customers.

 

[Edserv]

You gave so much love and attention to your house, then sold it. You gave 100% control to some stranger, trusting they would give the same (or hopefully better, or at least not lower-quality) of care to your project. Your project.

Your project got destroyed. Whether from the "Great Recession," from "incompetent owners," or from "foreclosure-lack-of-care-by-the-Sheriff-Plaintiff-etc" It doesn't matter, (sure it does,) who destroyed your (previous) property.

I was wondering, 1) can you buy it back and take control (financially feasible?) 2) Do you want to? 3) Are you interested in holding the asset long-term, which means becoming a landlord?

I have owned many investment properties, and many to which I was/am emotionally attached to- especially the "older structures with character."
But you also have to (just like with the sign industry,) make a profit or at-least break even on your investments!

Good luck
Chris
Lets Go Banners