KGET Community

why don't you ask Crabtree where he was when all this started??? and why did he go along with the hyped market

It is NOT a buyer's market!  Would you buy a stock if it we're going down in price?  No.  You would wait till the bottom (which is years ago).

Jim Scott is right affordability is the key issue!

But the young couple CAN"T afford the house!  Affordability is the key issue.

The sad truth is that Crisp and Cole are two of many crooked parties in the real estate market. This type of fraud is complex, time consuming to investigate and neither the local police nor the district attorney's office have adequate resources to handle this type of investigation. In fact, this type of fraud will tax the FBI's resources and in the end, Crisp, Cole and their croonies will get away with the cash they have pocketed and a slap on the wrist in federal court. Count on it. There are not enough jail cells for rapists, robbers, gang bangers and murderers- white collar crooks always walk.

All of these people involved in each transaction are so dependant on the deal going through that they turn a blind eye to any so called red flags or concerns.

"Unfortunately, I didn't have time to coordiante getting a live chat program up with our Webmaster."  

Kiyoshi, this would be what I would call poor planning. You mean no one could get it together but all these officials could make it to the studio on a Sunday evening.

I have a question. In the 4 years I've lived on Golden State Avenue, off of F St. near the former Montgomery World shopping center, a lot of houses have been for sale on Elm St., between Golden State Ave and 24th St. Is that due to the downturns in the market, as we're discussing tonight, or other factors? A lot of the homes are next to these huge power towers - are there illness problems here associated with these power lines? Are a lot of these homes distressed sales, as discussed tonight? What are the "comps" for this area?

Thank you
L. Bell

Kudos to Dean Florez!

I owned a house in the Silver Creek area, I got behind on my payment.  A company called Pradan, contacted me and offered me help.  They said they would pay off my original loan, and I would be refinancing thru them.  They were a Godsend, so I thought.  After about 3 months of paying my mortgage payment to them, I got a letter from my old Mortgage company saying that I was way behind and they were going to start foreclosure.  I called them, because obviously there was a mistake.  They had never recieved any payoff from Pradan, not even a call for a pay off amount.  Come to find out, Pradan put my house in their name, never paid off my original loan, took out a second AND a third, for over 100,000.00, and then left the city.  I went to their office, it was empty.  The number rang to a construction company.  I went to the police, apparently this company had done this to 30 other people in town.  Ultimatly I lost my house.  Im a single parent, and that house is where I raised my daughter for 10 years.  The house was ultimately auctioned off and sold for 205,000.00.  I saw not one dime.  I have heard thru the DA's office that this man, Mr. Williams who is supposidly the owner of Pradan Inc., has left the state and they are looking for him.  I hope that someday, this man is found and that he pays for everything he has done.  He ruined my credit, took my home away from me and my daughter...took the only security that we had.  

Even if you're a long term investor you MUST be concerned about this market.  Again why would you buy a $400,000 stucco box today when you can get it tomorrow for $250,000!

Notices of Default
houses and condos

County/Region 2006Q2 2007Q2 %Chg
Kern 549 1,593 190.2%

Richard Monje is uninformed.

Local builders are hurting. Several are about to go bust. Open your eyes Richard

Fun--Gary has been sort of a lone wolf.  He's one of the few people who have been critical of some of the shenanigans.

Jim please call these loans what they are - LIAR LOANS!  They weren't used by self-employed individuals.  They we're used by Crisp, Cole and cronies...

These issued dont affect you? Per Don Cohen. Just another salesman trying to make a commission.

Bubblebusting--
I'd agree that affordability is a major issue.  Housing prices are still much too high for the average person in KC to afford.  Couple that with the tightening credit market...and you've got what appears to be continuing troubled times ahead.

How can owners with sub-prime loans refinance their homes when the value of their homes have dropped .  Many owner have every intention to get a fixed loan but when the banks appraise the house they back out when the house is appraised below the amount of the loan.

Recall MR. Busbsy stating prices would rise 10-15% for the forseeable future? I do.

It's amazing how two different stories are being told. The real estate people are trying to tell us that things are fine, "just a little correction". While the economists are telling a much bleaker story.  Did they say that the median home price has only gone down 5% in the last year?? I fing that hard to believe. I live in a nice part of the NW and I know my home has gone down in value at least 15-20%.

Crabtree was onbaord on this in 2005 and early 2006. Then he found Jesus and went straight...

Can you explain why a House just South East Bakersfield in a gang area sells for just a fraction less then a house in Northwest (Olive Dr. area)  

The Appraisers and the Agents and the Lenders should be held accountable if they have created these false housing values.  

I think they are all lying.  And WHY would anyone choose an ARM to get into a house.  

I will have a house that needs to go on the Market and I wonder if I should hold off or go ahead and list it.????

PLEASE REPORT THIS AFTER YOU VERIFY:

Litton Home loans is now adjusting payments for persons who are in over there heads. they simply suply financials and Litton themselves with consider changing there loan to a fixed rate. This as of Yesterday. They had a companywide meeting 3 days ago. This is an effort to help some that simply cannot make the payments but do NOT want to default.

On that note: Whats the real problem with this market. Ethics and morals. Many people think they no longer have to answer for what they do. If you signed to make a payment, it doesnt matter if you have to get 2 jobs or 3 jobs, if your word or your signature means anything, you'll keep making the payment. It's not until you decide thats it's OK to stop paying that the market gets messed up. To all those who feel they got taken by their realtor or lender.... Tough, buck up and get some respect! Make your payments!

jasonb-

Yes, prices are down much more than this. Gary, like most, does not include incentives, cash back and other payments which tell the true story of the price declines.

Good sound byte for the senator. A special task force....how about hire some more cops to investigate it, some more d.a.'s to take them to trial, and some more jails to throw them into jail???

Special task forces will create a paper tiger, not a solution. Sacramento already has too much local money. Return it to the local level.

Does Mr. Crabtree want to tell us the numbers of overvalued appraisals he and his company have been involved in? For that matter does Mrs. Cheatwood wish to confess anything? Busby is on this panel simply for free advertising because his phone is not ringing these days.

Fraud is built into the system.

Kiyoshi, will you please ask why anyone would (or should) buy a home now if literally all projections (from S&P futures to Moody's to Average Joe) show prices heading lower for the next 18 - 60 months.  Seriously why?  Everyone should know that prices will not make a "v" shape (head straight down and then straight back up).  Rather prices will head down and then likely stagnate for years ("L" shape).

I think there needs to be more discussion of SUB PRIME vs ALT A

They are 2 seperate  programs and rates.  BAD credit vs good credit

In additoin some of the blame needs to be directed to WALL STREET.  If the product was not available it would NOT have been offerred.

Once again, kudos to Dean Florez. He is kicking these guys buts!

Also, no reponse from the REIC on the trillion dollar reset numbers. Ignore the truth and just tell people to buy!

Yeah i think all the real estate/mortgage people on the panel are full of ......

kiyoshi

"Gary has been sort of a lone wolf"

then ask him why he continued appraising properties at 30-40-50% yearly appreciation levels??? he's as guilty as the rest!

Yes blame the borrower. thats nice.

This is a joke.  If they really cared what we thought.  They would read our comments and answer instead Mr.  Kiyoshi Tomono didn't have time to get the Web team working to get this live.  Yeah right...how long did it take to get the story together, get the speakers and set this thing up tonight.  This just didn't happen in an hour or two.  Anything like this takes time so get the web team on board to if you really want our opinion.  

Stated income documentation loans never allowed for someone who was on unemployment.  It normally always required a CPA to provide a letter indicating that the borrower had been self employed for a min of two years.

Or required to have a verification of employment from a valid employer for a min of 2 years

KGET while i appreciate there this type of forum; however a bit mis informed.

most Broker (lenders0  or crooked realtors go out of bussiness they have already made their money , its the banks who lose money ... All they do is shut their doors and start over with a new company.

kenjohn5-
I'm here live.  I'm trying to read through comments and respond while at the same time posting the comments real time.  

The banks however need a portion of this lie to continue.  If it truly all stopped and everyone had to document income and provide a reasonable down payment prices would collapse!

Gee, a database, Ms. Cheatwood??? How about a simple one that requires the buyer's tax ID number, aka SSN in this database. How hard would that be?

She is also got her head in the sand saying that lenders are not wanting to hide the fraud. This is common as if customers, or more importantly potential customers, find out they will not take business to them.

Companies hide behind their lawyers when asked to provide documents for investigations instead of stepping up as a victim for prosecution. Companies will not willingly cooperate with law enforcement investigations. That is a FACT.

Jasonb--
There is plenty of blame to go around.  But you have to wonder how borrowers didn't notice 6 applications from the same person all claiming owner-occupancy to get 100% financing.  I know loan docs were flying across desks at that point, but isn't there some accountability for a red flag not being raised?
-K

i think everyone except Dean Florez is full of........
nobody cares about morals, ethics...and one reason is because these people
are not made to pay for what they have done!!!!!

I think a data base of people trying to defraud the bank is a wonderful idea .. Alittle late .I wonder how much the taxpayers are going to pay .Would be nice if the banks paid for it since they are the ones who reap the profits

where's that little ankle biter Kurt Rivera when you neeed him??? LOL

Dean the solution is unfortuently for them to lose their house. Unless they were defrauded it's the right market solution for long term good.

Just the other day the Sacramento Bee did a story on Elk Grove, I believe, having a similar real estate fraud ring there. This is not a local, or even a regional issue. Just like an iceberg, we've only seen the 10% above the waterline so far.

ASK SOME HARD QUESTIONS!!!!!!!!!!!!!!!!!!!!!!!!!!

You were doing good Dean, until you started talking about bailouts.

Try getting WS to unwind the MBS and find the correct tranche with the correct mortage - good luck. Not going to happen.

k- I think you mean didnt the LENDERS notice this was going on. thats why i say it is wrong to displace blame on the BORROWERS.

Kiyoshi is the "interactivity" simply you repling via this blog?  Or will some of our questions be read and asked of the panel on air?

Kiyoshi,

It is because the Crisp & Cole firm controlled all parts of the puzzle from real estate agent, to title company, to financing. They simply farmed out the financing to multiple loan companies and they "trusted" Crisp & Cole to be honest.

Mortgage brokers have become millionaires off of all of this.
Particularly those that dealt with the socalled subprime loans.
They've already made their money.
Sadly Mr. Florez and his fellow lawmakers are going to have to come up with some type of deterrent. That's what is takes. You have to legislate right behavior these days. You cannot allow these allow these 'associations' and 'boards' to police themselves by holding up their own phony inhouse ethics standards.

The government bailout this time will be INFLATION!  That way if you over paid $200K for a stucco box you'll be "even" years later because of high inflation.  But this will create even more problems with retirees living on a fixed income (that isn't inflation indexed).

The idea of getting some of these questions to the people live is a good one, but would not have been feasible since it's not airing live.  But I will be doing a story based on these questions on Monday.  

This information just reminds me of the reason I wanted to sell my house and move from this city. This city is becoming a sanctuary for crooks and they don't all live in poor neighborhoods. Crooks come in business suits and live in big houses. The greed shown by everyone in this business sickens me, lenders, appraisers and many real estate agents, shame on all of them.

if they couldn't afford a 30 yr fixed 3 yrs ago what makes you think they can afford it today???????? THEY CAN"T!!!!!!!!!!!!

Why was cheatwood invited???????????

I am sorry Tomono, I didn't see any of your comments and I have been reading through this.  However, I am not hearing any of these questions being asked to any of the members you have on board tonight.  

Would any of your so called experts suggest holding off on listing a house or go ahead a list a house, knowing the markets is going down.  This house in question is not a default this is just a typical NW (Olive Dr.) house that is acquired through a Death of a loved one and has to be split between 3 siblings?  

So what is the answer???  
I am interviewing Real Estate Agents and get a different story from each one with a different price ranging lows 200,000 to high 200,000.  Who do I believe and if the house goes in the low 200,000, how can you believe that when their are houses in the South East Bakersfield going for the same price.  And I am not talking the Country Club of East Bakersfield.  

I need an honest answer?

You've got to be kidding??? The secondary market is just where lenders sell off bundled "risky loans." Period. How can Ms. Cheatwood say she cannot answer it in 60 minutes???

bubblebusting-

The show was taped on Thursday.

(we need a cookie on this site, I don't want to keep typing in my url)

We're not live!  This is 2007.  Please tell me why we're not live?

A great question was just asked, Why are we still building new homes?? John Busby is saying he can get sub-contractors quickly, you could always get them quickly,but un-fortunately the greed in the city includes contractors and sub-contractors, heavy market/heavy prices, also many general contractors experiencing problems anyways due to cheap labor from across the border, a whole other subject matter. But the building/real estate industry are bed partners and all rolled into one big stinky ball...

i'm guessing the panel refused to appear if they were going to receive questions from the public

Yeah,
Would have liked to have made it live.  But it wasn't possible.  I tried solicitng questions ahead of time on Bakersfield Bubble.

Sad that we were not informed of this up front. I believe that each of us contributing thought that the panel might be subject to our questions and comments.  

Okay so we are doing everything to help people who were so stupid they got themselves in to a loan they could not afford. What about the people who are facing forclosure due to the builder being a crook. DMJ took construction money and did not finish the homes, who bails them out?

Summary-

Good - Florez, Crabtree (end of 2009 for the bottom)

Bad- Busby, Cohen

Joke - Monje (cheerleader for his clients) and Cheatwood

KelnJohn-
I will work on getting your answer from the panel members.  Anyone else have an opinion in the meantime?

I would still put Crabtree in the 'bad' column.

I am NOT learning anything I didn't already now.  

Bottom line there are two many houses on the markets...

Real Estate Agents are Hungry...

Builders keep building....

Appraisers .. who can you trust?

What's on the Food Channel???

I think Richard Monje made the best point of the evening. The lenders need to sue the buyer and loan officer and take back their money. There is no accountability

So what time on Monday will you air these answers if you get some?

steve-

Agree. He should be in the bad, however, I looked at Beth Cheatwood when he said late 2009 and she appread to be having a heartattck - LMAO!!

Kiyoshi-

You have almost 500 hits in an hour, this should have been done live!!! People want the truth and we could have grilled the REIC members, maybe next time.

Bako93301-
Haven't we seen this type of fraud before?  There is always a probably with self-oversight and one person controlling to much of the game.

what a let down! I'm going home!

BB-
I agree. Live would have been better.  But some of the questions do beg answers.  The report will air tomorrow night at 5.

bakersfieldbub-

they're ALL bad and Florez had no business even being there. By the time big brother gets around to even attemping to stop the bleeding it'll be all over.

remember Katrina, and that was simple....

now I'm going home!

I sure hope your report turns out better then this show.  However Kudo's for trying.  

I will be watching and waiting for my answers.  

Wow I don't see where you asked for questions ahead of time on bubble

scotty-
How many people will get away with fraud this around. We've been talking about how many more people may have been invovled in bad practices here in Bakersfield.  It seems to me the FBI, DA and police are going after the big players.  How many other people were doing things on a smaller level.  I think most would agree the fraud investigations aren't over.  But with not enough people investigating, and the amount of time it takes to search through documents, I think most people will get away with it.  And without repercussions and penalities, there is no correction in behavior.

scotty:
http://bakersfieldbubble.blogspot.com/2007/09/kget-real-estate-forum.html

Kiyoshi-

If they paid me what I am making right now as a XXX I would do the investigating 24 hours a day , 7 days a week. I would love to put some of these people away for a long time.

Bakersfieldbub....Im with you!  I would LOVE to see these jerks pay!!!!!!!!!!!!!!!!!!!!!

Kiyoshi, Something to look into:

Mortage insurance on 100% finaced homes. Is it more profitable because of insurance payoffs for a lender to let a borrower go into default because the loan is insured? Could be the reason some lenders won't renegotiate the bad loans....I believe all 100% loans were or are required to carry mortgage insurance....

and if thats the case, why would the lenders even care if buyers default. It would be like buying your car bak from the insurance comany after you total it. I know people who got the settlement then bought back the car and then sold it at a profit. Could this be something similar to whats happening with mortgage insurance?

kelnjohn5,

If you believe what "they" say, the housing market in Bakersfield will continue to fall for another 2 years.  Decide if you want to keep this house at least that long or put it on the market and see what happens.  The market determines the price but there are things you can do to help.

Look at similar homes in the area to get an idea of what is currently on the market..  Any realtor you interview should bring you this kind of information, ask for a list of comparables and recent sales.  Tour the houses currently listed.  Then make your's look better so that it stands out from the others and price it a bit lower.

You can hire a home stager to tell you other things you can do to market your house better.  BTW, did I mention that I'm a home stager in Bakersfield?  It's not expensive and the best investment you can make to prepare for a sale.  

You wouldn't go to a job interview in your PJs, don't sell your house the way you live in it.

Again, I'll be posing some of your questions to some of the folks from the panel tonight at 5.  

kelnjohn5---
Here's a video response to your question from Don Cohen:
http://www.kget.com/mediacenter/local.aspx?videoid=21217@video.kget.com

Kiyoshi-

thanks for follwing up with these guys. Cheatwood's answer was less than optimistic. And I really don't see how a persons credit rating affects the loan term though it does affect the rate. That said, I really doubt the folks that used the adjustable rate loans, neg am loans, interest only loans and so on will be able to afford a standard fixed rate loan. In the end your median income family cannot afford the meadian priced home.

Keep up the good work and hold these guys feet to the fire.

Geez, you almost make me feel bad for all that whining yesterday!

Keep it up!  

Kiyoshi-

Kudos for trying trying to get answers to the real estate mess that is choking our community.

I am absolutely shocked at the character assasination expressed on this blog. Why do people act like your panelists are crooks? Do these bloggers really think that every lender, realtor, & appraiser was out there trying to rip off their clients?

Get real folks, don't penalize a whole industry by the fraud of a few. I am a realtor, and I can tell you with complete honesty that I didn't commit fraud.

Its embarassing to see people attack Gary Crabtree. Two years ago I personally witnessed him tell the Bakersfield Association of Realtors that we were going to be facing massive foreclosures in 2007. He called it. He didn't create it.

When its all said and done I'm sure you will find that most if not all fraud was conducted by individuals with less than 5 years in the industry who noticed an easy way to line their pockets. Those individuals will be weeded out of the market because they won't be getting referrals & repeat business, which is the life-blood of any individual contractor. Any individual with solid experience in this business would not risk their career by commiting fraud.

Suggestions for those seeking realtors, lenders, or appraisers:
- be careful with individuals who have been in the local market for less than 5 years.
- be careful with full-service companys which offer lending as well as real estate.
- sometimes over-dressed is a sign of superficiality.

The current real estate conditions are due more to sub-prime financing than to fraud anyway. Sub-prime created a way for individuals to finance property in a quickly escalating market. It was not fraud. At its peak, I compared the market to a party where the host didn't order enough pizza, and suddenly everyone scrambles for the final pieces. Inventory was so low that people were making offers on properties sight unseen, just to have a chance to participate. It was a crazy time, and sub-prime enabled it. Just realize that there were many innocent practitioners out there just trying to satisfy the needs of their clientele.

And yes, it is a buyers market, but you must be aware that the market is likely to continue to slide for another year or two. While I have nothing against any panelists on the forum, I do feel that a couple of them tried to give a favorable spin as to current market conditions. This market really does suck, but when its bad for one segment its good for other segments. For sellers I would suggest selling soon, before the market falls further, but expect a long market time and low-ball offers. Its a great time to invest, as the rental market is showing good returns due to all the sub-prime borrowers who now have to rent again.

The one issue which I wish would have been touched on by the panelists is the fact that this current market is further hobbled by the tightening of credit. Lenders are having a terrible time right now because its so difficult to finance any borrowers with a credit score of less than 700. The financial markets have over-corrected and now less than 50% of people who want to buy can actually qualify. Therefore, we now have an under-supply of buyers, and an over-supply of sellers, which equals no demand for housing.

Thank you for allowing me to rant, and for not inviting me to be on your forum where I would have also been unfairly attacked by the uninformed blogosphere.

We've posted the entire forum here on our Website.  The link is in the center of our homepage. Also, who will be at Sen. Florez's real estate fraud forum Wednesday?  And how about his $2 proposal to create a fraud-fighting unit int he DA's office?

Firstly, I want to commend Kiyoshi on his work.  You are one of the few who are even trying to hold the real estate industry accountable.

Secondly, I want to respond in part to "Fearless1".

I don't think every realtor or mortgage broker is fraudster.  However, there is an inherent moral hazzard with the way in which you and your industry is compensated.  I find it perfectly acceptable for the seller's realtor to be compensated based upon a percentgage of the sale.  However, this method of compensation should be unacceptable for the buyer's realtor.  The fact that both realtors in the equation have a financial incentive to drive home prices higher is a large portion of the problem.  No one truly represents the buyer.

This in turn lead realtors on both sides of the aisle to broker larger and larger details for bigger and bigger commissions.  The fact is during the boom in prices the "work" didn't become any more difficult.  In otherwords, it is no more difficult to for a realtor to represent a buyer buying a $500K home, than a $600K home.  There is just more financial incentive for the realtor (and everyone else who is working off of commission) to artificially inflate the price of the home.  In fact it was actually "easier" during the market frenzy!  A partial solution is "fixed prices" (with no kickback) for realtors who represent buyers.

Thirdly, the entire notion that today is "buyer's market" because prices are heading down is ludicrous!  The answer provided by the "industry" yesterday was that the market is heading down and has not yet hit bottom, but it is still a good time to buy because we don't know where interest rates will be tomorrow.

True we don't know where interest rates will be - but we shouldn't care!  We must inform buyers that the overall price is what matters - not the monthly payment.

Which situation would you rather be in?

"Today's" Buyer: Purchases a $400,000 over-priced home and has a monthly payment of $2500 (assumes 6.5% over 30 years)

"Tomorrow's" Buyer (assuming rates rise): Purchases a $250,000 correctly-priced home and has a monthly payment of $2500 (assumes 11.5% over 30 years)

Your answer should be "tomorrow's buyer" for several reasons:  (1) there are no models predicting 11.5% interest rates in the near future, (2) you can always refinance your interest rate, but you can NEVER refinance your prinicpal and (3) it is much easier to sell a $250K rightly priced home than being upside on a $400K home.

This "trick" of having people only look at the monthly payment is in part what got us into this mess.  Individuals should pay what a home is "worth" - not what they can "afford" on a monthly basis.

Fourthly, much of the "spin" by the real estate industry is simply because they don't understand the macro-economics of the industry or business in general.  And please attempt to take what I say in good faith: "Realtors don't understand markets".  Honestly, who is our typical realtor?  They're typically high-school educated (yes many college educated indivduals are morons - maybe more so) and came into the field because the market was hot - not because they were well versed in real estate marco-economic trends.

This is in part why realtors can be so convincing.  They often truly believe what they say.  They honestly believed the market was going to go "up 10% - 15% for the foreseeable future" or that Bakersfield home prices "would hit a median of $500,000".  The problem is that they didn't believe (or say) this based upon any economic fact.  Our local incomes simply can't support those prices.  Consequently, once the Ponzi-scheme ends prices will again head towards normal.

Lastly, this brings to me my "when will the market hit bottom" comment.  Unfortunately, our local market (and the CA market) will not hit bottom in 2008 or 2009.  Rather this will likely be a long and painful process.  Again, our local "industry buffs" don't know or understand the broad market.  And if you don't believe me, maybe you'll believe those individuals betting billions of dollars in the Futures market that prices will head lower for a very long time.  Presently, the Futures market is betting that prices will fall another 20%+ in California and that a "recovery" won't occur until 2012 at the earliest.

Sorry for the long post and once again great work by Kiyoshi.  Please keep it up!

Bubblebusting--
Thanks, but I can't take the credit alone. Our station has been dedicating resources to this, and my partner in crime, Jim Scott has shared a great deal in the work.

I'm pasting below the news release from Sen. Florez's proposal and Wednesday workshop.  Anybody have an opinion?


BAKERSFIELD – As Senator Dean Florez prepares to host a community forum on the local impact of the state’s growing mortgage foreclosure crisis, he is calling on the Board of Supervisors to use its current authority to enact a simple, low-cost program which other California counties have used to combat increased occurrences of mortgage fraud, which too often go unnoticed and unpunished.

Florez, D-Shafter, will hold a news conference Tuesday afternoon in Bakersfield to encourage the BOS to use its current authority to fund a specialized department within the District Attorney’s office for fighting real-estate fraud by adding a negligible $2 fee on every deed of trust, mortgage agreement or notice of default.

At least 14 California counties have taken advantage of a 10-year-old state law that allows them to add a $2 fee to real estate transactions to fund a real estate fraud-fighting unit, allowing them to catch white-collar criminals whose tactics cause people to lose their homes and destroy their credit.

With foreclosures flooding the market, home sales are at their lowest in sixteen years and home values are on the decline.  Kern County’s foreclosure rate has jumped 190% since just last year, ranking the county fourth in the state in foreclosures.  All three counties with a higher foreclosure rate already have a real estate fraud unit in place to investigate questionable transactions which may be compounding the state’s housing woes.

Florez will also use the occasion to encourage those people in the community with concerns about their own mortgages or home values to participate in Wednesday’s forum, “Preserving Homeownership – Preserving Communities.”

“The best defense against a full-scale meltdown of the housing market is to make sure individual homebuyers know as much as they can about lending practices and about resources available to those under threat of foreclosure.  We hope to answer many of those questions,” Florez said.

Wednesday night’s forum will focus on the local impact of the mortgage foreclosure crisis on borrowers and neighborhoods, as well as the response by lenders and state and federal agencies.  Several community organizations will also be on-hand to present strategies for preventing foreclosure.  The forum will be held from 6-10 p.m. at the Kern County Superintendent of Schools, Room 1B, located at 1300 17th Street in Bakersfield.

Fearless 1:  Spot on!  I thought it took a lot of nerve for the panelists to expose themselves to what would certainly be a feeding frenzy from the Blogites who view ALL Realtors, ALL lenders, ALL appraisers as purveyors of fraud and greed and then view the people who bought homes in 2005 as hapless, uninformed VICTIMS!  A point I wish someone would make is that the people who bought these loans using non conventional forms of finanacing were given multiple disclosures that they had to sign--the terms were presented in CAPITALIZED BOLD letters informing the signer that the loan they were accepting (yes, accepting because there was no one there with a gun to their head) was definitely less than ideal (prepayment, adjustable etc).  But they wanted to jump into the housing market, they wanted to live in the house six months or a year and make a $100,000.  They did not know, nor really anyone KNOW that the market would turn.  When it did, the "poor" buyers cried foul!  "We didn't know what we signed, we didn't understand, it was not explained to us"---to that I say BULL.  If you didn't know what you were signing, if you didn't understand it or if it wasn't explained fully then you should have STOPPED immediately and not put another drop of ink on the paper UNTIL and UNLESS you were totally satisfied with the terms.  Sorry, I feel bad that the market turned, that you didn't make your 100 grand, that you have a reset coming that you never counted on, that you might lose your home to foreclosure BUT YOU AND YOU ALONE made the decision to close and accept the now villified loan.  My understanding is that these loans were used in many instances because of credit that was questionable.  These loans gave you a shot at homeownership and a two or three year period where you could get your credit straightened out.  I wonder how many followed thru and did it.  I venture to say...not a lot.  Yet, you are now, whining, crying, seeking pity and claiming you were taken advantage of.  Would you be doing the same thing IF the market had not turned on you?  No, you would be off buying the next house and probably using the same loan programs.  I heard someone using what I think is a pefect example of the mentality of these people who decided to accept these loans instead of waiting and doing what was necessary (whether it was to get their credit cleaned up, save some money or buy a lesser house).  Say I were to go down to Venture Out (or Stiers) and buy a big beautiful RV.  My plan would be use that RV every weekend.  But, my plan was altered when my employer decided I had to work on Saturdays...so much for weekend camp outs.  Now, a year later, I realize that it didn't work out.  Do I take the RV back and claim, I didn't understand, that it didn't work the way I wanted.  Do I claim that the guy who sold it to me put too much pressure on me.  Can I point to the finance guy and accuse him of not explaining every thing to me? Do I claim the dealer overinflated the price?  Do I wait for the federal government to bail me out...or do I act responsibly and accept the fact that I simply didn't make a good choice.  Personal Responsiblity for one's actions is severally lacking in today's society.  ("I did not have sex with that woman--Ms Lewinsky!")
Thank you for allowing me to share my thoughts and now all you bloggers, have at me!

I don't know if you'll find a single "blogger" who disagrees with Personal Responsibility.  Buyers need to be responsible for their actions.  However, so too should realtors, mortgage brokers, appraisers, lenders, etc.

The "buyers" were late to this party and were the least informed.  Those with the "knowledge" (realtors, etc.) have a responsibility to educate buyers.  Not simply tell them to "sign here, here and here".  Unfortunately, this what happened all to often.

But in essence "silentone" we all agree.  The government should not be used to bail out individuals and all parties must be held accountable.

Bubblebusting :  "The "buyers" were late to this party and were the least informed.  Those with the "knowledge" (realtors, etc.) have a responsibility to educate buyers.  Not simply tell them to "sign here, here and here".  Unfortunately, this what happened all to often."

Not to argue but just to raise a point:  Whether this happened once or a thousand times, shouldn't the buyers have stopped and taken the initiative to educate themselves and not have to depend on others to interpret for them.  If the buyers went along with the "sign here, here and here" scenario--my point is the same:  the buyers should have STOPPED!  I truly feel bad for everyone who has lost or is going to lose their home to foreclosure but I still believe that there is just NO excuse for not being informed/educating yourself/reading the loan documents/UNDERSTANDING the loan documents/askingquestions/getting second opinions etc. If they are  "late" then they should have just been a little later and taken the time to do things right. One other quick thought, whether the buyer was late to the party or early or had been to the party 6 times, chances are the party would have changed/reconfigured and it would be his responsiblity to inform himself of those changes.  Again, just a thought!

I agree the buyer should've stopped.  But the realtor (and/or mortgage broker) should have also stopped and explained the context of terms.  Neither party is immune from blame.

bubblebusting-

With regard to compensation and moral hazards let me just say that real estate commissions are negotiable between the realtor and buyer/seller. Some realtors do charge a fixed amount for the buyer or seller depending on what is negotiated between those two parties. When the market was climbing quickly, many realtors were actually cutting their commissions in order to compete with discount brokerages who were listing many properties. But where are those discount brokerages now? When the market gets tough, the discount brokerages evaporate because it requires more than just a sign in the yard to sell homes in a tough market like this...it takes professional marketing strategies.

Home buyers & investors don't need to fear that realtors are not fairly representing them because they're paid by commission. The fact is that for an independent practitioner to get repeat & referral business, that practitioner must work in the clients best interest. If my buyer tells me to write an offer for $20,000 less than the list price, it is my responsibility to honor their wish...even if it insults the seller, and I earn less commission. The fact is that the buyer will appreciate my dedication, and return to me in a few years, as well as refering other family and friends to me. I have many repeat clients because they trust my ethics and my judgment due to previous transactions that went well for them.

I'm not trying to sound self-righteous. I am talking about proper business etiquette. Its all in the bible: "Do unto others as you would have them do to you." I'm not the only one. I've dealt with plenty of realtors in this community who truly care about providing good service to their clients, including buyers.

I don't know your occupation, but I am truly offended by many of your misguided statements. Yes, it is a buyers market even though prices are soft. No one has a crystal ball, but the trend for prices is downward. Each day is a snapshot in time. If property "x" can be purchased for less this month than it could be purchased for last month it is a buyers market, as the buyer is saving money. If property "x" costs more than it did last month it is a sellers market, as the seller is earning more. Its all supply & demand. Nobody knows what factors will be introduced to the market within a 2 year, or 5 year, or 10 year period to affect prices. For all you know a major company could place their headquarters in Bako next year, creating 5,000 new jobs which would create more demand for housing.

Your statements,

Fourthly, much of the "spin" by the real estate industry is simply because they don't understand the macro-economics of the industry or business in general.  And please attempt to take what I say in good faith: "Realtors don't understand markets".  Honestly, who is our typical realtor?  They're typically high-school educated (yes many college educated indivduals are morons - maybe more so) and came into the field because the market was hot - not because they were well versed in real estate marco-economic trends.

This is in part why realtors can be so convincing.  They often truly believe what they say.  They honestly believed the market was going to go "up 10% - 15% for the foreseeable future" or that Bakersfield home prices "would hit a median of $500,000".  The problem is that they didn't believe (or say) this based upon any economic fact.  Our local incomes simply can't support those prices.  Consequently, once the Ponzi-scheme ends prices will again head towards normal.

are COMPLETE HOGWASH!

You make blanket statements & generalizations which aren't true, accurate, or fair. I'm sorry you must've put your faith in the wrong people. Maybe you didn't do your homework when selecting who would look out for you. You must've really got burned or you're just associating with the wrong crowd.

I'm sorry if someone tried to "trick" you by selling you a monthly payment instead of a purchase price. I've witnessed those tactics by car salesmen, but not in the housing sector. Your realtor should've helped you compare sales prices...I'm not aware of any realtors who don't compare values. Again, you must've been dealing with a bad person, BUT DON'T BLAME THE WHOLE INDUSTRY. You may have legal grounds against that individual, but don't indict the whole industry. WE didn't harm you.

I guess its too bad that a couple bad apples seem to spoil the whole bunch.

As I stated before, beware of individual contractors with less than 5 years of experience. They are the ones who jumped into the market when it was hot and saw an opportunity to make a fast buck. Many of them only had a high school diploma and had little knowledge of economics. They were just riding the wave. Since the wave has receded they'll be out of the business soon if they aren't already.

Put your trust in the experienced practitioners. I assure you that most realtors with over 5 years experience do have college degrees, will actually look out for your interests, and possess a much better understanding of economics than you do.

G'day

Didn't get burned, rather I simply didn't use a realtor at all.  I originally bought in mid-2001 (by owner - no realtor) and then sold in early 2006 (by owner - no realtor).  No sob story.  Yes, I'm sitting on the sidelines marveling at this mess.  Fortunetly, this has also been true for a few of my friends as well.  We have benefited from the "macro-economically clueless realtors".

In fact, I should in part thank the Crisps and Coles because I was fortunate enough to experience a tremendous runup in my home's value and then get out before their actions caused a crash.  However, it was because of our refusal to listen to realtors and other industry insiders that we are able to now take a "wait-and-see" approach back into the market.

Your entire notion that individuals who work off of commission have the interest of buyer at heart is ridiculous and counter-intuitive.  Additionally, your notion that local realtors have a macro understanding of real estate is equally as ridiculous.  As you correctly stated realtors are similiar to used car sales man.  Would you ask a Bakersfield Toyota used cars salesman how auto sales are over at the Bakersfield Ford car lot or how California auto sales where or how US auto sales are?  No for two reasons: (1) you know he doesn't have a clue and (2) he'll likely tell you "his truth" rather than "the truth".

"fearless1" you sound like an honorable guy and I truly don't think every realtor is a crook.  Additionally, I think realtors can be of service to certain types of buyers.  However, I also recongize that anyone selling me a good is much more likely to tell me "his truth" rather than "the truth" about his product.  Potential buyers need to understand this and be wary of anyone (not just realtors) who sales them goods on a commission schedule.

Lastly, once again it is not a buyer's market.  This connotation implies that it is better for buyer's to buy than for seller's to sell.  At present, our market is the reverse.  It is better to be a seller because you can still get out now before the hammer really hits.

The odd thing about this TRUTH, is that the market was actually a buyer's market several years ago during this runup.  Why?  Because the buyer's were guaranteed to make money and see their home values increase.  In other words, it was better to a buyer of real estate (so long as you sold before it became a seller's market).

And if you believe it is such a "buyer's market" why don't you use that line with your clients.  "Hey Mr. Smith prices are heading lower for the forseeable future, but buy now cause it's a buyer's market!"  Your client will laugh at you and likely retort, "Why would I buy now, I'll just wait until prices hit bottom".  And that's exactly what smart buyer's are doing.

Sorry, to hammer this point one more time.  But when the stock market is heading down and is in a bear market, do you hear anyone say it is a buyer's market?  No people correctly try to wait for bottoms (which is admittedly tough in the stock market, but fortunetly easier in the real estate market due to "sticky prices").  On the other hand, when the market is rising and it is in a bull market it is a time to "buy, buy, buy".

Booyah!

Fearless-

How about this scenario...the listing agent works for Watson/Touchstone and so does the buyer's agent, do you honestly think the buyer will get a fair shake??? They won't if commissions are being paid. It's as bad as buying a car....everyone suffers from a lower price....except the buyer!

I have a good idea about Senator Flores and his community forum. Get someone who has more on the pulse of the market and this town than Flores. Flores is only interested in what good he does for himself. Hell he can't even make up his mind if he is a Democrat or Republican. Hey Dean the circus has left town you missed the truck!!! Play your lip service somewhere else.

bubblebusting-

You hit on exactly what I was talking about...because the realtors you mention may have committed fraud, you make it appear that the whole industry is in cahoots - which is wrong. I am an honorable guy, and most other realtors are also quite honorable.

Please don't twist myt words. You incorrectly asserted that I compared realtors to car salesman, when I was actually stating the opposite - that realtors are not like car salesmen.

Again, you generalize when you refer to "macro-economically clueless realtors". To use such blanket statements is inciteful unless you specify which "macro-economically clueless realtors" you are refering to since the vast majority of experienced realtors are not macro-economically clueless. Once again you are using the trait of an unspecified realtor to slam the whole bunch...and thats just a classless cheap trick.

You stated:

Your entire notion that individuals who work off of commission have the interest of buyer at heart is ridiculous and counter-intuitive.  

My "entire notion" as stated previously is that good customer service leads to repeat & referral business...from buyers & sellers...whether I'm paid by commission or not. This is a sound principle...there is nothing ridiculous about it.

You stated:

Additionally, your notion that local realtors have a macro understanding of real estate is equally as ridiculous.

Rather, your notion that local realtors don't have a macro understanding of real estate is ridiculous.

You stated:

However, I also recongize that anyone selling me a good is much more likely to tell me "his truth" rather than "the truth" about his product.  Potential buyers need to understand this and be wary of anyone (not just realtors) who sales them goods on a commission schedule.

Hey, I agree. Sales commissions have been part of this business long before I was ever licensed. I'm not going to defend their existence, but as I stated previously, commissions are negotiable with all realtors. You can even negotiate a flat fee with your realtor if you both agree to it. I've worked on a flat fee before and it didn't bother me.

You appear to have an attitude that all realtors are greed-mongers. While some may be, I assure you that most are not. Certainly, many of the more recent licensees were when they jumped into the hot market. But the greed was just as noticeable among all the non-licensed house flippers who sprung out of the woodwork. Where is your wrath for them?

Let me tell you, living on a commission can be maddening. Have you ever tried it? Sure it was easy when the market was hot, but over 20 years of commission sales life is a financial roller coaster. Try budgeting your money when your escrow is delayed or falls through by no fault of your own. Man, I'd love to have consistent income.

Your thoughts on the market are generally correct, but as I defined previously this is TECHNICALLY a buyers market even though it is a bear market. You're right that it is better to sell now, before prices slide further...and its better to wait until prices hit bottom in order to purchase. It is a buyers market when the buyer dictates the terms of the transaction. It is a sellers market when the seller dictates the terms of the transaction. Right now buyers can easily pick up properties while demanding incentives. When it was a sellers market the seller could select favorable terms from multiple offers. When it was a sellers market, a seller in LA or wherever, who held property in Bakersfield before prices went up, could sell that property and make a handsome profit on it regardless of whether they re-invested that profit back into this market.

...and yes, I do tell clients that the market is trending down, that they may get better value if they wait, but you know what...some of them don't want to wait. Some of them see rents going up, some of them need to re-invest from a 1031 exchange, some of them have other pressures that make it advantageous to buy now. Every buyer has a unique situation.


funsucker-

Yes, buyers need to exercise extreme caution when the buyers agent & the sellers agent are in the same company. Dual agency requires full disclosure. I hate dual agency - it puts a lot of pressure on the realtors involved. I find it best to have the buyer present their offer to the seller face-to-face with both agents present. Keep all the cards on the table, as my father would say. Yes, in this manner the buyer will get a fair shake.

The following occurred at 3:14AM on October 4, 2007:

A local realtor admitted: "You're right that it is better to sell now, before prices slide further...and its better to wait until prices hit bottom in order to purchase."

I'll let potential buyers determine their actions based upon this now agreed upon FACT!

bubblebusting-

I don't understand why you appear to act like my statement above was so shocking. It is what it is...big deal. Don't blow it out of proportion. It is only better to sell now, based on value. Sellers need to understand that in a buyers market such as this:
A. There is a huge inventory of homes to compete against,
B. They must price their property competitively to be noticed,
C. They may have to wait months to get an offer,
D. When they do receive offers, they are likely to be for much less than the list price, with buyers asking for a variety of incentives,
E. When they do receive offers, the buyers financing could easily get shot down by the latest underwriting guidelines, and
F. I would definitely use an experienced Realtor with marketing savvy that exercises patient tenacity, and communicates regularly. A good Realtor will explain the potential risks to the seller, and show how the seller will be protected with proper service.

Let me simply your approach:

"Sellers should take any offer!"

Students in public higher institutions of learning have expressed discontent over the new student’ s loan scheme yet to commence.