About San Leandro's Lebrun

When preparing the house for sale, homeowners have a clear choice: A) Keep a low budget and do it yourself (DIY) or B) Go Pro and make some money. The difference is actually like day and night. On the DIY project with a low budget, the house most likely will take time to sell and the offering price will reflect the quality of the materials used and the level of workmanship.

Getting professional help is the way to go, it will impress would be home buyers, it will show well, it will sell faster and will bring in more money because it will give the impression that the house has been well taken care of, home buyers usually pay more for quality.

Home buyers look at a lot of homes for sale before making an offer, and usually can spot those that have been poorly dressed for sale. There is the presumption that there might be even more problems resulting from neglect and hence will not even consider making a decent offer, the fear of discovering something more serious that require expensive repairs is well founded.

Preparing the house for sale is a very important step, not only does the house has to show well, if you can prove that it has been well taken care of, and is in move-in condition, you will have an easier sale. The following steps ought to help you:

• Pack before you put the house on the market, keep just essentials pieces needed for a comfortable living, put the rest on storage. Less is more when showing the house

• Have a home and pest control inspections done well in advance, make sure you call a local, reputable company that can stand scrutiny.

• Address any and all issues from the reports, have the work done professionally and with the necessary permits. Not only would you be protected from liabilities by their warranties, home buyers and appraisers will give more value to the house because of its condition.

• Nothing is more inviting than a fresh coat of paint and some new flooring, special attention should be given to the front of the house, the famous "curb appeal" is very important. Fresh flowers ad color and life to a dull yard.

• When it comes to paint, do not just go "hospital like" white paint, ad some warm, earth tone colors, and here is a trick, empty a small bottle of vanilla into the can of paint, it will give the house a nice "home like" kind of smell. This is a must if you have pets, or if there are smokers in the house.

• Get some high wattage light bulbs and flood every room with light, and do not forget to have all windows cleaned. Speciall attention should be given to bathrooms and the kitchen. They should be well lit and spotless!
  

Remember and double check this: the IRS sometimes considers any work done to the house up to 6 months prior to listing it as an expense of sale. Capital gain taxes could be reduced by the cost of fixing the house. There is another benefit to this approach of using professinal help: use all those invoices, warranties and bids as part of your real estate disclosures, make sure the buyers sign and acknowledge receipt of those documents.

Sometimes I take my seller clients out of their house and walk them across the street, I ask them to turn around and look at their house with home buyers eyes... If they like what they see, we are fine, if they don't then we have some work to do. Happy selling!

One of my best friends is seriously thinking about walking away from his mortage via a strategic default. But his guilt and sense of moral obligation and ethical responsibiliies are killing him. He wants my opinion... he bought his home in 2007 for about $850,000 and it is now worth only $550,000. His payments are going to almost tripled the amount he currently pays in about a year. A strategic default occurs when a homeowner stops paying their mortgage even though they are still financially able to do so.

I told him the standard Realtor talk: I could not tell him what to do, he needed to talk to a his bank about possible options for a loan modification, also to talk to his CPA to understand potential tax liabilities, and to a lawyer for potential legal ramifications, and to consider the hit on his credit scores.

Then we went off record, and as friends we discussed the issue in an open manner. I do not understand why is the homeowner the one that is supposed to be the only responsible party and to pay up and not go back on his promise to hold his own. A loan after all, is a business transaction between an investor and his partner, the borrower. The Investor puts up the money and expects a return in his investment, the borrower agrees to make payments until the loan has been paid off completely. Investor makes his money back plus some helfty profits and the borrower will end up with the property free and clear, hopefully worth a small fortune.

There is no investment of any kind that has no risk at all. Lenders have always reaped good returns on those investments, and traditionally have had good safeguards against losing. They even have Private Mortgage Insurance (PMI) that they ask the borrowers to pay for, and the government has a golden parachute to bail them out. How come they do not have moral or ethical obligations to make them feel guilty? They have scared people into staying in their homes and continue to make payments even though, those houses will remain underwaterl for many years.

Home owners traditionally have paid their mortage, and their house was one of the major debts that they wanted to pay off first. The investors greed helped create the economic collapse, the no-money, interest only loans they sold to unqualified borrowers were irresponsible, they deserve to lose. Home borrowers already lost their downpayment, and their closing costs, along with their dreams, sometimes compiled with the loss of a job and their own self steem. Why should they feel guilty about losing the house? why should they be the only ones asked to be moraly and ethically correct? The lenders have recovered quickly and will go on making money. Homeowners, however, will take years to recover, if ever.

We concluded that as equal partners in this transactions with the banks, homeowners should be able to call it quits, accept the loses and go forward and not feel guilty about a strategic default. Making high payments on a house that has no chance of providing a return for years to come is not in the homeowners best economic interest.

My friend will let the house go, and start the recovery period, knowing that nobody will loan him money for at least 3-7 years. He will rent for a while, save money and be prepared to invest in homeownership again... sometime down the road. He realized that he has nothing to be ashamed off, or guilty of, he will lose his down payment or initial investment, it was a risk he took, the lender took a risk too, it is after all, a simple business transaction that did not pay off for either party. If you make a bad investment, you have the right to walk away from it.

During a recent listing presentation, I met the beautiful grandaughter of the octogenarian homeowner willing and ready to help grandmother with the delicate issues of selling the home. A young, smart, beautiful professional teacher, she was in town for a few days with the purpose of helping grandma with the move, and she brought her newborn baby girl with her.

After the customary "Cooks' Tour" of the house, we sat down in the living room where grandma was, to go over the paper work, schedule open houses, hours of brokers tours, when and how the house will be shown, etc. But the baby started crying, so the mother excuse herself and went to tend to her daughter, she come back a few minutes later with a small blanket covering the baby, she was breastfeeding her, and sat a bit tilted away from the sunny window, which put her diagonal from her grandmother. Then she asked that incredible question: "... do you mind if I feed the baby while we talk? Oh, no, not at all, I quickly responded. I did not know any other way to answer that question.

While feeding, the baby kept moving her little hand and exposing mom's boob, giving me random nip flashes. Thankfully, she did not realize the type of view that I was being offered, what is a man to do in a situation like this one? I struggled to keep my eyes on her eyes, so I remembered one of the lessons I learned earlier in my Real Estate training, listen carefully and make lots of notes, write everything so you remember important things later. Bringing down my gaze obviously was a good tactic. Not that it lasted too long. I had lots of questions, after all this was a big house, you know.

Needless to say I was very comfortable with the situation, however after asking a few of my colleagues what would they have done, the gender pretty much dictated the pros and cons of conducting business under these circumstances. Breastfeeding during a business meeting is perfectly O. K. by me. Other people seem to be uncomfortable with the sight of a mother feeding her child. For men of course, breast are complicated, breast are dual-purpose machines, and we men can have some trouble completely severing the link between boobs and sex and replacing it with boobs and nurturing babies.

The sight of a woman's breast should never be an issue for anybody. The mermaids of Piazza Del Neptune in Bologna, Italy have water shooting out of their nipples, and it is one of the most visited places for tourists. I also heard about the protest organized by nursing mothers in a subway in New York, after being harassed, they decided to spend a couple of hours with their babies feeding them in public, to make a point.

This is one of the most natural things to do for a mother. (I only wish the local mothers will organize a similar protest in the bay area ... I will definitely offer my support! and will go protest with them side by side) By the way, those ladies in New York actually helped introduce legislation in congress to protect a woman's right to breastfeed on federal property where she and her child have a right to be. The bill was signed into law on Sept. 28, 1999 by then president Clinton.

We were able to accomplish our goals of putting a good plan in motion to sell the house. Because of the baby interruptions, this meeting took a bit longer than the average, after all, a listing presentation includes lots of details. After this meeting, I went to the office and read the notes I so diligently wrote, here is a partial list;

Wood burning fireplace
Bottle feeding is unhealthy!
Upgraded electrical system
new roof was installed just 3 years ago
Go Baby Go! Babies should not be covered while feeding!
First Open House next Sunday afternoon
Babies should nurse around the clock!
Pacifiers should be outlawed!
Great partial views!

Needless to say this was an interesting business meeting, worth remembering. But it does not appear to be a clear answer to this type of meeting. What would you have done?

Could this possibly happen? Are Short Sales now becoming Long Sales? In this case the escrow closed, buyer moved into his new home and 30 days after that, he received a visit from a Realtor who told him to move out because the bank had acquired the property via a trustee sale.

Once escrow has closed, the issues of the prior owner cannot affect the new buyer of the property. After all, a title insurance company is responsible for the transfer of a clear title to the new owner, and the only lien should be the new mortgage that the buyer acquired in order to buy the property. Every property sold with any type of financing is required to have title insurance.

In a typical transaction when a borrower stops making payments, a Notice of default (NOD) is recorded 90 days after missing the first payment. A Notice of Trustee Sale (NTS) is recorded 90 days after that. In the meantime, the seller can opt to sell the property if the bank approves what is called a short sale, meaning that the total amount of the mortgage owned against the property is going to be short of the full amount. A short sale can only be initiated when there is an offer on the property.

When there are two or more lenders, like in this particular case, they negotiate an agreement between them, based on how much money from the proceeds each will take in order to sign off the lien and allow the property to sell to a new buyer. During this time, however, the trustee might schedule the sale of the property using the powers granted by the Note and Deed of Trust.

When lenders are negotiating an offer, they postpone the Trustee Sale in order to allow the short sale to happen. The trustee sale can be postponed many times. When a short sale is finally approved and the escrow closes, then the trustee sale is canceled completely. It is the banks responsibility to notify the trustee that the sale has occurred. It appears that in this particular case, the bank failed on this critical last step.

A recording of the new deed should signal the end of the entire transaction, sellers move out of the house, new buyer takes possession and a new lender becomes the only lien holder. In most cases that is the entire process. No matter what happened before, if the bank accepted a short pay off and the new buyer bought the property, no other procedures should happen for many years to come, and it will be up to the new buyer and lender to do whatever they want, a process entirely independent of the the prior sale.

In this unusual case in Fremont, California, the bank approved the short sale, signed the closing documents, got paid and then conducted the trustee sale anyway ... and become the new owner of the property it just sold. As a matter of fact, the lender send the check back to the title insurance company 30 days after escrow closed and ask to have the sale rescinded. Title company send the check back saying it cannot do that. Meanwhile the title of the property still shows Indymac as the new owner, in other words, it shows as an REO. How can this happen?

No matter how I look at this situation, there is no way that a Realtor or a Home Buyer can see this coming, or prevent it from happening. Escrow closed in December 2009, Trustee Sale happened on January 2010, it is mid March 2010 and we still have no resolution to this problem, the title company says they are negotiating with the bank and that the issue will be resolved soon...

Needless to say, the new buyer is not happy at all, he is receiving visitors that look at the property as an REO and think it will be available for sale. This particular buyer looked at over 50 properties, wrote 27 offers and after almost a year, he moved into his new place... I wonder when he is going to start truly enjoying his new home.

The local real estate market is showing signs of life! Finally! we are sensing more activity at open houses and sales at all price points. It does appear that home buyers are more aware of what this market is offering to them right now and they are finally taking the plunge. The $8,000 credit to first time buyers is a big pull plus fix interest rates below 5% shown all over the news is a confirmation to them that this market is turning around and if they don't buy now, they could simply miss the boat entirely. Spring time is the PERFECT time to buy a house.

I predict that as we get closer to the November 30th deadline for the $8,000 tax credit there will be a rush of first time buyers trying to get into the market, but probably they will not find by then the number of properties available to chose from that we have right now.

Here in the wonderful east shores of the San Francisco Bay, in our quiet little town of San Leandro, CA, we are seen below the $300,000 level a tremendous amount of activity. We have encountered multiple offers regardless whether these listings are bank owned properties, short sales or simple common listings. We have not seen multiple offers on the same property for years, but now they are almost the rule. Within the last few weeks we have written 9 offers on behalf of several of our first time home buyers, and still cannot find them a house. These buyers are loosing to other buyers offering sometimes up to $40,000 above asking prices.

Behind the bad news about a recession, lay off numbers up and unemployment numbers rising, there is a very active real estate market happening right now in certain areas of the country, there are great bargains out there for first time buyers and first time investors, people are taking another look at real estate as the great investment that it truly is. Investors are out there competing directly with first time buyers, perhaps they see that the number of displaced families who lost they homes to foreclosures will turn into good long time renters, these people used to be home owners and will have to wait years before they can buy again, rents will be going up as the demand increases.

As a Professional Realtor I welcome with enthusiasm these positive news, I have seen in the last few years how bad financing destroyed the American dream, put people out on the streets, broke families apart and decimated my industry. The damage done to the trust and the credit worthiness of the individual will take years to heal. But for now I am very glad the long road to recovery at least appears to be within sight.

Antonio & Alexia Cardenas, "The Realtors In Motion" Serving the wonderful Counties of Alameda & Contra Costa Counties, specially the following cities: San Leandro, San Lorenzo, Castro Valley, Hayward, Oakland. Visit us on line at: www.listedbyAntonio.com (510) 326-4263