Big Bear Illuminated

Big Bear Lakefront Sale

 This home is located at 730 Tayles Point in The Boulder Bay neighborhood in Big Bear Lake. It is situated on a spur of land that juts out into the bay. For my money, it might be the best lot on the entire lake. It actually has 160 feet of lake frontage. It sold for $685,000 and was on the market for only four days. It is my second lakefront sale this year. If you would like to see other listings in Big Bear or have any questions, please don't hesitate to contact me at izzy.barden@gmail.com .

Bank Owned Checklist

 

Recently, it seems like every time a good bank owned property comes on the market, it is like blood in the water with four, five or more offers coming in. If you want to have a chance at snagging one of these good deals away from the other sharks, you need to come prepared. I have prepared a sort list of things you need to have ready in order to write the best offer possible.

1. Make sure you are preapproved and have your letter with you. This will let you know what you can afford and also let's the selling bank know that you are already approved and can buy the property in question.

2. Have current bank statements and your check book. You will need to write a deposit check and many banks are asking for proof of funds up-front with the offer.

3. Be prepared to go over asking price. If a home is worth $200,000, but only priced at $135,000, you can be sure that somebody else will offer full price for it. If you really want it, you will have to come in even higher. Most banks will give everybody the chance to come in with a " Best and Final " offer, but not always. Sometimes, your first offer is your only shot. Be prepared for this eventuality.

4. If your Realtor is an experienced agent who has dealt with REO properties, listen to their advice. Odds are they have been in a similar situation and they know what to expect.

5. If there are multiple offers, don't ask for a home warranty, termite work, or anything that is not absolutely necessary. The more you ask for, the less chance you have of getting your offer accepted.

While there are many variables that can occur, keeping these five things in mind will help you get the property you want.

Big Bear Lakefront Sale

 

I just recently closed escrow on this lakefront beauty. It is 2,622 square feet and sits on a 8,464 square foot lot on the lake. It was built by Bob Dixon in 1999 and was a steal at $890,000. If you are planning on buying or selling a property in Big Bear, I would love the opportunity to be of service. Contact me at izzy@thetimwoodgroup.com .

Watch Out For The Other Guy

 

One of the benefits of the market being in decline is the mass exodus of bad agents. If you are a buyer or a seller, the odds are much better that you will get a competent agent to represent you. Unlike days past when an agent just had to sit by a phone to do business, today's Realtor actually has to work his or her tail off to be successful. That being said, you still need to be careful.

There are still part time housewife's out there who do a deal or two a year for some extra money. The checker at the local Von's still dabbles when an unsuspecting victim falls into the web. Even the meter reader for the electric company will try to pass as a full time professional Realtor. They are not doing their clients any favors. The market has undergone a massive upheaval and you can not do business the same way as five years ago. In Big Bear, bank owned properties make up 10% of the inventory and 40% of the sales. If your Realtor is not proficient in dealing with REO's, Short Sales, etc, you are asking for trouble.

I have an example from my last escrow to share with you. My clients put in an offer on a bank owned property listed by an office from out of our area. We did everything we were supposed to do and were just waiting for escrow to open. I have sold around 20 bank owned properties in the last year or so and there is almost always a delay in the bank opening escrow. So, after a week went by I wasn't too concerned. After almost two weeks went by, I became alarmed. I called and emailed the listing agent two or three times a day for three days without receiving a response. I finally had to call his broker and demand that someone who was competent be put in charge of the deal. I was given an assistant who seemed to have some idea of how things worked. Finally, after almost three weeks, I was emailed an extension agreement that stated we were requesting an extension due to the listing office opening escrow with the wrong company and not realizing it for two weeks. Two weeks? If I hadn't called the broker with my concerns the listing agent would have just coasted along obliviously and incompetently until our deal crashed and burned.

I also have experiences that are the exact opposite. I sold a bank owned property a little while back that was listed by Theresa Grant with Coldwell Banker in Lake Arrowhead. Like most bank owned homes, it took the bank longer than usual to open escrow, but everything else ran perfectly. Theresa made sure I received regular updates and her assistant was on top of everything. I got all the paperwork on time and done correctly. Because we both did what we needed to do , the transaction was very smooth and I was able to give my client excellent service.

If you are considering buying or selling, ask the Realtor you are dealing with some qualifying questions before you proceed. Make sure they are a full time, professional Realtor and not a part timer. Make sure they have a good, working knowledge of the local market. If you are planning on buying in Big Bear, it is a very bad idea to use somebody from L.A. or Orange County. If you are planning on buying a Bank Owned listing, it is especially important to use somebody who is experienced in selling them. The banks do thing very differently and a Realtor who doesn't know what they are doing can blow the deal or end up costing you a great deal of money.

REO Timelines

 

Buying a bank owned (REO) property is a much different process than a traditional listing and it is imperative that your Realtor know the difference. If your Realtor is not aware of the differences, they could not only cause you to lose the property, but also cost you money in the process. Let me explain.

Banks hold all the cards in a bank owned transaction. They don't have disclosure requirements and set all the rules. They usually make the buyer sign an addendum that basically takes away most of the buyers protections and puts the ball squarely in the banks court. They set out a timeline you, as a buyer, have to meet or face the consequences. While they don't have to deliver anything until they feel like it.

For instance, I have a bank owned property in escrow right now that I got approval on almost a month ago. Guess what? The bank didn't open escrow until three weeks into the 30 day time period. We didn't get a copy of the signed contract or bank addendum until three weeks into the deal. Of course, the bank addendum we signed at the beginning of the transaction had us agree to pay a $100.00 per day per Diem for every day we went over the 30 days agreed upon in the contract. Then they did nothing on time to make it possible for us to make the deadline.

This is where my experience came into play. I have had this happen to me numerous times on bank owned purchases and I have learned that my buyer just needs to forget about the bank and make sure he does everything he needs to do to stay on track. As long as we can show the delay is not of our making, we can get out of paying the per Diem. I made sure our inspections were all done within 10 days and I made sure the listing agent had the termite inspection done also. Since my buyer is paying cash, the appraisal was not an issue. On a property where the buyer is getting a loan, you need to be on the phone with the lender every step of the way to get the appraisal done before the contingency period is up. You don't want anything going wrong at the last minute if you can help it.

You can't always get everything to go the way you would like, but if you do everything you can do, things tend to turn out OK. I always have to remind my clients that most banks don't really have any idea of what is going on at any given time. They seem to just flounder around in the hopes something will eventually happen. In the last couple of years I have seen numerous instances of banks doing things that make absolutely no sense. It is actually kind of rare to have a bank owned transaction that goes perfectly smoothly. If you hire a good, knowledgeable Realtor and do everything you need to do on time, you will come out ahead in the end.

Bank Owned VS Short Sales

A question I seem to get quite a bit these days from my clients is " What is the difference between short sales and REO's?" I then , usually, go into a whole explanation of the pro's and con's of each, and end up telling them that REO's are superior in every way. I have a couple of dealings over the past couple of months that really bring this point home.

The first case involves a really neat family I have been dealing with for over a year. They are from North Hollywood and have wanted to buy a place up here for a long time. When we initially looked, we couldn't find anything that really fitted their needs. They decided to wait a year and then take a look when the prices had really dropped. So, I took them out a couple of months ago and found a cabin that was perfect for them. The cabin is super clean and situated on a great lot with a ton of beautiful oak trees. Even at the $149,900 price tag, it was a great deal. The one big problem with it was it being a short sale listing. I warned them of the major hassles that usually accompany buying a short sale, but they liked the house enough to risk it.

As many of you know, the majority of short sales do not close successfully. This is usually due to the listing agent not knowing how to do them, but taking the listing anyways. If the listing agent doesn't put in all the work ahead of time, a short sale is a nightmare. In this case, the listing agent assured me that he had done all the footwork and the bank was ready to move. With this information, we decided to offer $120,000 cash for the cabin, knowing it would probably be refused and we would have to come up to make the purchase.

A month into the process  we still hadn't heard back from the bank. At this point I was fairly certain the listing agent was full of it and hadn't really done what he needed to do to get a short sale done. I told my clients that all we could really do was wait and see what the bank would do. After a month and a half, the listing agent called me to say that the bank had just taken the listing away from him and never gave us an answer. I knew sooner than later, I would be seeing the home again as a bank owned listing. I told my clients to hang tight and that I would check the MLS everyday until it appeared.

Sure enough, a week and a half later it came on The MLS for $130,000 as a bank owned property. I called my clients the minute I saw it and we wrote an offer for $115,000 cash. The bank came back the next day at $117,000 cash and we snatched it up. Not only that, but the bank repaired some broken pipes under the house that the original owner most likely would not have been able to afford to do. Basically, the bank took a month and a half and did nothing when it was a short sale. Once it was a bank owned, we bought it in two days for less money and had repairs thrown in as a bonus. Bank owned One, Short sales Zero.

The second situation is very similar. My clients put in an offer of $340,000 on a short sale listed at $389,000. Again, we waited patiently for almost two months while the bank had the home reappraised and numerous BPO's done. In the end, after two months, they rejected our offer and let the home go into foreclosure. Like the last time, I watched the MLS and saw the home come up as a bank owned property for $390,000. My clients and I both felt the home was overpriced and we should wait and watch it to see if it would reduce. After two weeks, it hadn't sold and we decided to make our move. We came in at $333,000, and waited for a response from the bank. This time it took one day to get their answer, which was no. After a week of wrangling, we put the home into escrow for $339,000. So, we got a lower price in only a week when it was bank owned. Bank Owned Two, Short Sales Zero.

Big Bear Log Cabin Bargain

 

With all the fervor over bank owned properties, it is sometimes easy to overlook homes listed by an actual homeowner. This can be a big mistake. If the homeowner in question is savvy on market conditions and has a good Realtor to advise them, traditional listings can be just as much of a bargain as an REO. Case in point is this home on 385 Glenwood, located in The Castle Glen area of Big Bear Lake. This home is a true beauty. It is full log construction and backs to wide open eagle preserve. The home is 2,200 square feet and sits on an oversized 15,300 foot lot. It has three bedrooms, two bathrooms and a detached two car garage. All for only $599,900.

Believe me when I tell you, there are bank owned homes in worse condition and lesser settings that are priced higher. This seller realized that he was in direct competition with bank owned homes and priced his home accordingly. Since the home is owned by a real person, there would be full disclosure and a chance for repairs to be done. I guess the point I am trying to make is, don't just concentrate on REO's. There are a great many other homes out there that may be even better buys. Enlist the services of a professional Realtor and let them be your bloodhounds. If they are good, they will be aware of the best deals, no matter who the seller. For information on this home or any other for sale in The Big Bear Valley, please email me at izzy.barden@gmail.com or call me at 909-273-8980.

Fool Me Once......

 

I was inspired to write this blog today by, coincidentally, a blog written by another Big Bear Realtor that I read today. In his blog he made a claim that was so far off base it was laughable. He claimed that home prices in Big Bear are actually rising. Rising? I watch this market like a hawk and I have seen nothing that points to a rise in prices. As a matter of fact, for now, prices are dropping almost 1% per month. I understand seeing the glass as half full but, spreading misinformation like that is helpful to nobody. What is going to happen when he talks somebody on the fence into buying a home based on his made up statistics? When that buyers home doesn't appreciate in value that first year, there is going to be some you know what to pay.

As a buyer or seller, you owe it to yourself to use somebody who is not afraid to tell you the truth. No matter how bad it may be. In fact, honesty should be the number one characteristic you look for in a Realtor. There are definitely some unsavory characters out there. Folks who will tell you your house is worth more than it is, so they can get the listing and then hammer you for a price reduction afterwards. Or, they might tell you that prices have started going back up to get you to buy right now. A good Realtor will give you all the correct facts and let you make the decision.

I don't know where the bottom is on this market. I don't think anyone knows for sure. All we can do is make educated guesses and try to do our best. Are prices going up? No, they are not. Do I think the bottom is close? Yes, I do. Do I think this is a good time to buy? Definitely. With prices and interest rates at a low level, I feel it is a good time to buy. However, only if you plan on keeping the property for at least five years or longer. You need to give the market time to correct itself and start an upward climb once again. If you feel like you are talking to a used car salesman instead of a professional Realtor, don't be afraid to make a change and find somebody you can trust.

Never Count Your Chickens.........

I am making this post as a word of warning to the buyers and sellers out there. Just because the lender assures you everything is okay, don't take their word for it. A deal can go south at any time. Most times, at the last minute. You have your buyers ready to sign docs and WHAMO! The underwriter just torpedoed the whole thing. In most cases your buyer probably has spent hundreds of dollars on home inspections and related items. The seller may have spent thousands of dollars doing repairs and getting termite work done. When the lender pulls the plug, it can create massive problems.

A perfect example of this happened to me today. I have the buyer and seller on a short sale property here in Big Bear. Typically, the bank that holds the note is a major hurdle in a short sale transaction. Surprisingly, the bank was prompt and helpful this time. They wanted to get this cabin sold and did everything in their power to get the deal to go through. My buyer got pre-approved through GMAC very quickly. He has done two refi's and bought two other properties with them in the past. They approved him for a 30 year fixed with 15% down. The home appraised and GMAC assured us everything was a go. We were scheduled to get docs today and hopefully be closed by next Tuesday or Wednesday. Then, all of the sudden, the underwriter says that they want an extra 5% down from the buyer. This loan has been in the works for a month and they just suddenly decide to change the terms on the last day. Not only did my buyer pay for inspections, he bought new furniture for the house based on his lender telling him everything was fine. What a mess. If they had told him he needed 20% down from the get go, we could have made this work. He could have saved for another month and not bought furniture right away. As it is, the lender has created a huge mess for everybody involved but them. Frustrating.

Big Bear REO Listing

 

This bank owned home is listed by Woodstock Real Estate and just became available yesterday. I drove over to check it out and really liked what I saw. The home sits on a large, over 8,000 square feet, lot and is in a nice setting. It is 1,622 square feet with 3 bedrooms and 1.5 baths. It has two nice fireplaces, with one in the master bedroom. It last sold for $275,000 in May of 2005. At only $184,900, I don't expect this to be around for long. For more info on this or any other Big Bear listing, please contact me via email at izzy.barden@gmail.com or call me directly at 909-273-8980.