linda | Humphrey Home Connections Realty

December 27, 2011 By linda 1 Comment

Introduction

I am delighted to introduce Dan Rider, a long-time local real estate broker with extensive experience in the REO arena. He has some valuable insight on the entire foreclosure process which he has agreed to share with us in a series of guest blog posts. His first post addresses Assembly Bill 284, passed in the last Nevada legislative session, and some of its (possibly unintended) consequences. Take it away, Dan!

Where have all the defaults gone?

As you may know Assembly Bill 284 took effect on 10/1/2011 and requires that lenders have proof of ownership prior to filing a Notice of Default on delinquent mortgages in Nevada. This legislation intended to put an end to the nasty “robo-signing” issue. Well it certainly has done that and then some. We’re nearly three months into this and NODs have virtually come to a halt. Is this what our legislators intended? I hope not….

First of all, is this legislation a direct challenge to MERS (the Mortgage Electronic Registration System)? An explanation of that system follows below and has been copied directly from their website:

MERS is an innovative process that simplifies the way mortgage ownership and servicing rights are originated, sold and tracked. Created by the real estate finance industry, MERS eliminates the need to prepare and record assignments when trading residential and commercial mortgage loans.

Simply put, MERS allows banks and investors to exchange mortgages without the typical title and escrow work we’re all familiar with when we buy, sell or refinance our homes. While your home may have stayed with you all these years, your mortgage has likely changed hands many times. This system has served the banks well for many years. However, at this point bankers are clearly lacking in confidence when it comes to risking a felony offense.

Secondly, this will no doubt have an effect on housing inventory in Nevada. At some point in the near future, the inventory of available bank-owned homes will drop dramatically. Short sale home sellers may delay their plans. Why rush to sell short if the lender isn’t going to rush to foreclose? (Editor’s note: I have heard anecdotal reports of local attorneys offering this very advice.) I’m very concerned that this will create a false sense of demand in the market. Prices may rise due to scarcity but there’s no doubt reality will roar into the market someday soon.

Last but not least, why would any bank want to lend in Nevada? Let’s think about this… High unemployment, declining home values, state mandated foreclosure mediation and now this. Seriously, I’m no big fan of the banks but common sense would seem to dictate that Nevada is not a great place for banks to do mortgage business. Home financing is already tough in our market. No doubt this will only make things tougher in the long run.

Let’s hope our legislators do a little more homework before they pass the next round of laws intended to protect us all.

Filed Under: Distressed Properties, Featured Articles, Foreclosures / Bank Owned / REO Tagged With: distressed property, foreclosures, notice of default

REOs: Money Pits or Glory Holes?

September 6, 2011 By linda Leave a Comment

REOs: Money Pits or Glory Holes?

Most of us in this day and age are familiar with the abbreviation “REO” for real estate owned, otherwise known as a bank-owned foreclosure property. The term is generally used (and specifically now by the Northern Nevada Regional Multiple Listing Service) to include all foreclosures, including those currently held by Fannie Mae, Freddie Mac, and HUD, which of course are not banks. Now I remember back in the day when these properties were called OREOs, “other” having been added to the moniker for some unknown reason hopefully more important than making a cutesy acronym.

And most of us, if not personally familiar with the description “money pit” have at least seen the movie by the same name. If not, use your imagination! On the other hand, those not from these-here parts (that would be Northern Nevada, pilgrim!) may be less familiar with the term “glory hole”. Glory Hole was a term, and in some cases actual name, applied to certain ore mines, particularly those rich in minerals such as silver and gold; a site where one might, with luck, become fabulously wealthy. (Yes, I have indeed discovered that the term “glory hole” has been hijacked in recent times by pornographers, but that doesn’t detract from its historical significance.)

So back to the subject at hand, for all of you that didn’t immediately leave me to Google “glory hole” after that last observation. Which category might we expect an REO to fall into? The answer: BOTH!

On the one hand, the Money Pit. Picture yourself in the homeowners’s shoes. The bank is banging on the door, demanding the deed to your property. You know it is just a matter of time until they prevail. So, being as you’re a bit short of cash (hence your circumstances), you decide to start putting whatever you have aside to begin anew after the inevitable. No maintenance to the property. No yard work. Nothing that requires investment on your part into a property you are gradually divorcing yourself from. Then, on the flight out the door as the sheriff’s posse moseys down the street, you remove every item of conceivable value. Depending on your level of irritation and technical skill, that might include appliances, ceiling fans and light fixtures, perhaps the HVAC system or hot water heater; you get the picture. If you are really pissed off, you might knock a few holes in the wall, let your pets do their business all over the wall to wall carpeting, flush cement down the toilets, and so on. But even if you are the most earnest, well-meaning foreclosee on the planet, and remarkably there are MANY of those, there is deferred maintenance with a capital D left behind. Yes, it may appear from a casual review of a comparative market analysis that the property is a “deal”, but it had better be more than that. What crazed buyer would pay a below the market price only to slave away on fixer-uppering to end up paying the same amount they could have bought a pristine, no-special-conditions property for, not even including any value for their sweat and toil?

But ahhhh! We have all heard tell of the investor that struck gold…the proverbial glory hole of REO properties. The score on the courthouse steps that no one else recognized for the killer deal it was. The less killer, but still respectable, profit being made by those in the know. Yes, it IS out there. And there are plenty of foreclosures to go around. Interested? Check out our new foreclosure search tool, then give us a call!

Photo Credits: Abandoned Nevada Mine by RickC, Glory Hole by btsiders, Crowne-Bars by digitalmoneyworld. All from Flickr via Creative Commons license

Filed Under: Distressed Properties, Featured Articles, Foreclosures / Bank Owned / REO, Home Buyers, Investors Tagged With: delinquent mortgages, distressed property, Northern Nevada real estate, REOs

Shadow Inventory and the Foreclosure Timeline in Nevada

September 5, 2011 By linda Leave a Comment

Shadow Inventory and the Foreclosure Timeline in Nevada

Despite all the press it gets, shadow inventory in the real estate market has never, to my knowledge, been officially defined. Is it the homes that the banks have foreclosed upon and not listed for sale? The properties that have fallen into default but not yet hit the courthouse steps? Where do short sales fit in? How about the normal, every-day sellers that would like to sell their houses and move, but haven’t tried because a)they don’t believe they would be approved for a short sale, or b)they can’t bring themselves to take the loss, even if it is a paper loss from an unrealistic value? Back in the good old days, we Americans used to move about every seven years on average. Is that pent-up selling demand part of the shadow inventory?

Whatever you choose to include, it is pretty clear that this backlog of inventory must make its way through the real estate pipeline, like a giant dinner bulge through a snake, before we can regain some sense of normality.

A quick review of the timeline for foreclosures in Nevada may provide some insight. For our purposes, lets assume that Harry and Hannah Homeowner have fallen on hard times and cannot go on making the payments to their lender. There are various sidetracks that they can take throughout this process (short sale, deed in lieu, bankruptcy filing, loan modification, etc.) that we shall ignore for simplicity.

Month One

1st – Payment is due on the Homeowners’ first (and only) mortgage

16th – Payment is late; late fees apply. If they pay the mortgage and late fees before the end of the month, likely no credit hit will ensue

Month Two

1st – Payment is now 30 days late; the Homeowners are delinquent and just received their first credit ding

Month Four

1st – Payments are now approx. 90 days behind. The Homeowners are “in default”. A Notice of Default is filed by their lender with the Washoe County Recorder and sent to them by registered mail. At this point they have 30 days to pay all of their back payments and fees and remove the default; at the end of that time, the acceleration clause in their mortgage kicks in making the full balance plus late fees due and payable. In Nevada, the Homeowners also have the right to request mediation with their lender. A mediator will be appointed upon their request, with the cost split between the Homeowners and their lender. This right will be brought to their attention in the Notice of Default paperwork that they receive, along with an application to pursue it.

Month Five – The Homeowners have either waived mediation/were not eligible/did not respond/or mediation was completed without relief for them. A Certificate of Mediation is filed, and the foreclosure process resumes.

Month Seven – The Homeowners are now six months delinquent. A Notice of Trustee’s Sale is filed specifying the date, time, and place of the auction sale of their property. This notice is published in a paper of general circulation for three consecutive weeks, with the sale scheduled for the fourth week. The sale can be postponed three times, then another notice is required.

Month Eight – A foreclosure sale takes place on the courthouse steps. The home is either sold to a third party, or else is “sold” back to the lender for the amount of their opening bid, which may be the total of what was owed or some lesser amount that they specify.

Subsequently – If the Homeowners are still living in the home, they will either be offered cash for keys to move without damage to the property, or else formally evicted and removed by the police.

So, with that background, where do we stand in Northern Nevada as far as “shadow inventory” at the various time points described? Here are the stats for Washoe County (population 417,379) as of this date (Labor Day, 9/5/11):

Notices of Default: 1868

Notices of Trustee’s Sale: 656

REO (ForeclosureRadar): 914

REO listed in MLS: 923

Less than 90 d late, want to sell but not listed, etc: ?????

Please visit our Foreclosure Search page to search for properties in any stage of the foreclosure process!

Picture credits: Garter snake eating a toad by The_Gut, Shadow houses by D’Arcy Norman, both via Flickr Creative Commons License

Filed Under: Distressed Properties, Featured Articles, Foreclosures / Bank Owned / REO Tagged With: foreclosures, REOs

For Rent: 1690 Plumas $1400/mo

August 21, 2011 By linda Leave a Comment

This cute and updated 3 bedroom, 2 bath home is located a short bike ride from downtown in trendy old Southwest Reno. It features hardwood floors, a wood-burning fireplace, air conditioning, a 2-car garage, and a private and secluded back patio with mature fruit-bearing trees. Pets are permitted on approval. The rent is $1400/month, with a $1200 damage deposit required at move-in. It will be available the first week in September. Drive by, and if interested call one of us for a tour, but hurry, this house always rents quickly!

Disclosure: Two of the owners of this property are licensed agents in the State of Nevada

Property Photos

Property Map

For information:

Linda Humphrey 775-287-4665

Valarie Rider 775-250-2240

Filed Under: Featured Properties, Rentals Tagged With: Reno homes for rent

Climbing Mt. Rose – A Popular Reno Summer Outing

August 14, 2011 By linda Leave a Comment

Towering over Reno, Nevada at 10,776 feet, Mt. Rose is both an immediately-recognized landmark and a favorite hiking destination. The Mt. Rose summit trail is long enough and climbs high enough to present a challenge, but at just over five miles each way, is easily accomplished in an afternoon if you are even reasonably fit. And the views along the way and especially at the top are well worth the effort.

Your adventure begins at the parking area close to the high point on Mt. Rose Highway (State Rte 431) before it drops down into the Lake Tahoe basin. Here you will find some large informational signs and a “bathroom” (the rustic kind, but clean). The trail head is clearly marked. After a short climb, the first 1.5 miles or so of the trail are flat and wide, mostly forested, with intermittent views of both Lake Tahoe and your destination at the top of Mt. Rose; it looks like a long way up from down here! Coming out of the trees, you will next make a loop around a large meadow area. On our most recent visit (July 2010), there was a large waterfall splashing down the hillside at the back corner of the meadow. Numerous hikers had stopped there to enjoy the view and/or climb up to the top. After the waterfall, the trail borders the back side of the meadow, crossing several seasonal creeks and passing fields of wildflowers. At the end of the meadow, the climb begins in earnest.

The next section of trail winds up a hillside and back into the trees, eventually breaking out much higher up. At this point, you cross a saddle over to Mt. Rose proper and begin the final push to the summit. The pine trees gradually give way to scrub brush until you emerge into an exposed area of broken rock. The wind can really pick up at this point, and the temperature can drop, so it is best to be prepared. But views become increasingly spectacular as you traverse the switchbacks until you finally round the turn to the summit. From the top, you can see for many miles in every direction: Lake Tahoe to the south, Reno to the north and east, and a series of lakes including Donner Lake to the west. You really feel like you are on top of the world.

This is a popular hike, so the likelihood is that you will encounter many fellow travelers along the way. This is not a destination to “get away from it all.” At this altitude, the sun is intense, so sunscreen is highly recommended. It is also a good idea to carry a windbreaker or some sort of waterproof jacket. And don’t forget plenty of water. It is easy to underestimate how much fluid you are losing in the high desert, where sweat evaporates as fast as it surfaces on your skin.

Filed Under: Featured Articles, hiking / Backpacking, Reno Sports Tagged With: Mt. Rose, outdoors

Do You Believe in Bad House Vibes?

August 14, 2011 By linda 2 Comments

House vibes. Do they exist? Do you feel them? If you are an agent, do your clients comment on them?

There is no doubt in my mind that you can walk into some houses and feel warmly received, even if no one is there, even if they are empty. There is a sense of calm, of welcome, of good will. On the other hand, some places get your hackles up the minute you walk in the door.

I was out with some clients last week, and happened to overhear the wife whispering to the husband “lots of arguments in this room.” She is a very intelligent and highly educated woman, and I suspect she was whispering because she was afraid I would think she was a bit ditzy. As it happens, I am a firm believer in house vibrations as a result of several personal experiences. We got talking about it, and the rest of the day she was more comfortable sharing what she was sensing as we walked through the homes on our shopping list.

I will never forget one particular incident. I was representing a buyer who fell in love with a cute short sale home in Northwest Reno, very homey and inviting. She really liked it, and we were in and out several times visiting, taking measurements, etc. The sellers seemed nice enough, and we waited out the several months of bank circumflatulating until an answer came back from the listing agent: the lender was insisting on a promissory note and the sellers flat out refused. Game over. Sorry.

She was seriously disappointed, but I assured her we would find one just as nice, and we made an appointment to start looking again the following weekend. After touring several homes, we happened to drive by The House. She looked longingly at it, and I suggested that we should take one more peek…if it was the house of her dreams, then maybe she could buy it after the foreclosure.

The minute I opened the door, we both got cold chills. Nothing looked different, but we looked at each other with a sense of foreboding. Something was seriously wrong and we could both feel it. We walked into the living room, then very hesitantly into the kitchen, where we found the p.o.’ed homeowners had returned to wreak major havoc. Fixtures ripped out, appliances missing, water all over the floor where the dishwasher was impatiently removed and stolen. Holes in the walls and ceilings. You get the picture. Such a cute house…so sad. We bolted out as fast as we could.

Now before you get the idea that I am some kind of woo-WOO-woo-woo person, I am far from it, perhaps the antithesis. But I have experienced this phenomenon too many times to discount it. The scientist in me tells myself that there are subliminal cues that our subconcious is picking up on as we enter these homes that lead to uneasiness and goosebumps, rather than presences or spirits or ill will. But who knows?

Filed Under: Featured Articles, Home Buyers, Home Sellers, Real Estate Miscellaneous Tagged With: Northern Nevada real estate

Man Plans and God Laughs

August 14, 2011 By linda Leave a Comment

Don’t know who said that, but I love it. And it is never more true than when a real estate salesperson decides to leave town for a few days.

Case in point: somewhere last fall, I thought it would be a really fun idea to go visit my sister in January. Slow time of year for the business; tradition has it that our real estate market here in Reno takes off around the middle of February every year. And did I mention that my sister lives in the Cayman Islands? Well, yeah, there is that…here in Reno, January is dark, cold, potentially snowy, and generally devoid of redeeming social value. Unless you ski of course, but that is for another blog.

So here I am ready to leave town (actually I am sitting in a hotel near the San Francisco airport as I write this). And just like clockwork, starting about 36 hours ago, business starts to come out of the woodwork. Please understand I am not complaining here…it is just so remarkable the way the real estate fairy waves her wand and God smirks.

Two new clients are referred in, each with a laundry list of requests…look up this, CMA that, is this still on the market, when did it last change hands and for how much, etc.
One longtime sideliner decides to spring into action
One listing suddenly gets multiple calls from potential buyers…none, of course, are working with anyone, and all want a personal tour asap
Three clients in escrow, one of which was supposed to close tomorrow, probably not going to happen, major drama
One client, after waffling for months, wants to write an offer. Today.
And finally, for the first time, one of my posts is not only featured in ActiveRain, it is sent out in the Daily Drop and instantly opens a can of worms that results in tons of really interesting comments. I want to respond to each one. But when? Have to be up at 4:00 am to catch 6:00 am flight to Miami

I think maybe I have stumbled upon a secret of the universe: plan trips, but then don’t go!! Just let the business roll in.

Filed Under: Real Estate Biz Insiders, Real Estate Miscellaneous

16050 Geyser Rd

August 14, 2011 By linda Leave a Comment

***********Price Reduced!!!!**********
If you are looking for a beautiful setting for your South Reno dream home, look no further. Featuring four acres of mature vegetation and pasture land, this homesite is unmatched in the Reno area. Accessed at the end of the Geyser Road cul-de-sac, the property is secluded and private, yet minutes from Arrowcreek Parkway and 395. Perfect for a Gentleman’s Ranch or just a private homestead in the trees; bring your horses! The property is surrounded by Whites Creek, a natural year-round stream, on two sides, and Steamboat Ditch (surface water rights available) on a third side. The beauty and tranquility must be seen to be appreciated. Huge price reduction to only $500,000.