June 14, 2005
-- by Dave Johnson
Help! Any ideas, comments welcome.My answer? Sell now, take the $85,000 loss, before things get worse. (Update - Oops, they're out the $85,000 PLUS the closing costs from buying PLUS the costs of selling, which can be quite high -- realtor commissions, appraisals, inspections, repairs, etc.)
My partner and I are in a mess with a brand new house in Las Vegas. Here are the details.
1. AUG 2004, we paid $445,000 for a Pulte model in the community of Aliante, North Las Vegas.
2. 100% financed and still owe roughly the same.
2. Payment is $3000/month.
3. Currently could only sell for about $360,000.
4. Finally found tenants to lease out for $1100/month in APR to reduce neg cash flow to $1900/month.
We are running out of cash quickly. We desperately need some ideas on how to get out of this house immediately.
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The cartoon "Kathy" was about the housing bubble today.
Posted by: grannyinsanity at June 14, 2005 6:20 PM
This is off topic but up your alley Dave.
There is a thread at Left in the West about growing
young Democrats and this was in the comments
Would you weigh in on this for possibly the ninetieth time?
Posted by: grannyinsanity at June 15, 2005 12:00 AM
Coming soon to a neighborhood near you...
Houses here in SD were selling like hotcakes for a while, now I'm seeing houses that have sat on the market for several months. I think it's close to over....
Posted by: donna at June 15, 2005 12:11 AM
Dumbasses. They should hand the keys to the bank, and walk away. If they're that short on cash, then they might as well declare bankruptcy and get it over with.
Looks like the rent to ownership differential there was about 1:4 (add another $1,000 a month to the $3,000/mo. mortgage for maintenance and other misc. items). Truly wacky.
Posted by: Thomas Leavitt at June 15, 2005 12:14 AM
according to the Sunday NYT it is not just in the US..Dublin, London, Hong Kong Beijing, Madrid, etc.
Posted by: patrick at June 15, 2005 9:59 AM
Didn't something very similar happen in Margaret Thatcher's Britain?
Posted by: Helga Fremlin at June 15, 2005 2:37 PM
The real comedy is to be had by tracking back to the speculator-friendly website where the original post was made.
The advice the guy is getting from the players there basically amounts to this: "you don't have to file for bankruptcy if you can find someone else even more desperate and stupid than you!" The scam is to find a "motivated seller," i.e. some poor bastard even more stupid than you, and convince him to take the bad risk on you that your bank is currently carrying. Your sucker sells you his house for half price plus a note from you for the other half, while you are asking the bank to accept the new house as collateral on the old loan and release the old house, and also while you're applying for a new mortgage on the old house to finance the purchase of the new one.
Does this sound crazy? It might not sound crazy to the bank. They're not the ones getting stuck with a potentially worthless promissory note pushed at the back of the line when you eventually file for personal bankruptcy. That would be your sucker who is getting set up to receive that shaft.
And if you're *really* a shitheel, you can just stop paying the private note and see if you can hire better lawyers than your sucker. Don't you just love these people?
Posted by: s9 at June 16, 2005 2:08 PM
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