Kevin

Kary,

Do you have any examples of these frivolous lawsuits? I'd love to do a case study.

It's pretty clear that you've decided to stay away from distressed properties, and I respect that, but allow me to share my perspective. In fact, here are real examples of a day at work for me:

Realtor: "hey Kevin, I don't care what you do. Please help, I don't care if I make no commissions, please just help me close this thing."

Homeowners: "I don't know what to do, I've lost my job, I can't pay these payments and the banks are threatening to foreclose my property. Is this really happening? I think foreclosure is the best way to go because I really don't know what to do."

It's really hard for me to ignore these types of calls, especially when I know exactly what to do in these situations in order to:

1. Save realtors commissions
S. Save homeowners lots of money, their credit & and their psychological wellbeing
3. Stimulate the economy by saving banks thousands (sometimes hundreds of thousands) of dollars per closing
4. Make myself money by helping people

The penalities are high because they need to be. There are agents out there who pick up pre foreclosure listings for the sole purpose of letting them go into auction (in order to buy them). Not to mention the thousands of ameature RE investors out there who, after attending a couple RE "guru" sessions, went off tying a bunch of properties up in effort to sub 2, wholesale or quit claim these properties just to fail miserably and watch the sellers go into foreclosure. The list goes on: Equity skimmers, mortgage fraud, stealing downpayments on lease to purchases, etc.

You know how good it feels to watch these companies collapse (all within the last year), yes, the very companies that I used to get in serious tussles with prior to any DHC law. From what I've observed, it's pretty evident that these laws have, in effect, eliminated a majority of these types of companies/investors, not to mention listing agents who have no idea what they are doing trying to pull of a short sale. The clean up was done quickly, efficiently and now it's time for realtors to reach these same homeowners and give them what they truly need, which is guidance according to their best interest. So while the liability is high, the results are very strong and it's just a matter of time before realtors realize that the purpose of our new DHC laws aren't to limit realtors but to help them have their share in this difficult market. If agents are still not willing to take them on, they should at least find an agent who's willing because look, homeowners NEED US TO DO THIS! - Wed Oct 15 2008, 22:53

This means that you might be able to get a great deal while simultaneously helping the homeowner. I just snatched two pre-foreclosure deals for one of my buyers just in this last week.

As far as liability is concerned, yes there is a liability just like every other business out there. That's why you need a pre-foreclosure/short sale investment specialist, somebody who knows how to avoid legal pitfalls and other issues when doing these type of deals. Don't work with just any agent, trust me. You won't get what you're looking for - Wed Oct 15 2008, 17:37

Jess,

Easy answer. It's an excellent time to buy as long as you can afford it. I bought a view condo in Seattle at a discount and am antipicating quite the return in 5+ years. I suggest you invest in a short sale or a condo in a great location and hold it for 5+ years. Do not depend on appreciation, instead, buy a home with immediate equity based off true market value and comparable sales. Basically, you need to buy cheap. If there aren't enough comparable sales, find a better location. If you're going to live in it, do not allow it to exceed 40% of your income. If you're going to rent it, make sure your mortgage balance allows you to cash flow according to true market rent. For King, focus on downtown/west Seattle or Queen Anne. Be picky but be wise! - Mon Oct 13 2008, 22:37

The Moores,

The best market you've seen in 8 years? lol (x10,0000000000000000000000000000000) That is the most blatantly one sided view of our economy I have ever seen. You are speaking from an investors perspective, not the perspective of the American people. Distressed sellers..foreclosures..failed banks..job loss..bankruptcy....how is this the best market you've seen in 8 years? You're Wal Mart Wal Street analogy alone reveals a whole lot about where you are coming from. See, a sale at Wal-Mart is a basic selling principle, a trade off between profit margin and volume. A "Wal Street" sale, however, has more to do with peoples credit & livelihood vs. a small minority of big pocketed investors who, perhaps in the same way you mentioned it, view this housing crisis like a BIG OL' SALE.

Keep in mind, I am a short sale expert and I believe that short selling properties to investors is a great way to stimulate our economy and save/make everybody lots of money. However, you need to understand that lots of people ARE "dying because of Wall Street." Comments like that can be easily misconstrued and may cost you lots of business, especially with educated buyers. Might want to clarify where you are coming from next time. Comments like that make us look greasy and profit centric. - Sun Oct 12 2008, 17:17

I recommend you find another realtor, because he's obviously working for commissions, not for his clients. His advice is way off. Purchasing a home in hopes of equity is a dead end street, you need to purchase a home with instant equity in today's market. That's if you can afford it. If you can't afford it, don't buy at all, especially if your monthly payments exceed market rent. Indeed, there's been ignorant agents out there who've put buyers in homes they couldn't afford, but you shouldn't play the blame game either! They couldn't have done it without no doc/state doc loan programs, 100% financing, variable rates, ARMS, etc. There's lot of bad realtors and mortgage brokers out there, but you do need to separate the sheeps from the goats. In my career, I have never had a buyer pay a mortgage in excess of 40% of their income. Look, in today's market, you have to be a discrminate buyer. Shop for deals. Find a short sale and help yourself, the seller and the bank. - Sun Oct 12 2008, 16:24

lol

So the lenders aren't the ones to blame for the housing crisis? lol

So what are you suggesting? Eliminate this profession and allow homeowners to wheel & deal on their own? Sure that'd be great, FOR ATTORNEYS! - Sun Oct 12 2008, 15:51

Banks will pay commissions. Agents, please don't let them pay you 5%. 99% of the time they WILL NOT disapprove of a shortsale because of a measly 1% difference in their net pay off. - Tue Sep 30 2008, 15:10

Actually, what you need to do with contact 1-888-995-HOPE or visit them at 995hope.org

They are a free foreclosure counseling and part of Bush' federal mortgage relief plan. You need to speak with them before speaking with a loss mitigator.

Good luck

Kevin Kim - Tue Sep 30 2008, 00:20