Desperation or Inspiration...

Often, there is such a fine line between desperation and inspiration. However, in this case the proverbial writing on the wall must be etched with blinking neon. The lenders and those that are still in the market (holding the bag) are beyond panic mode - it is downright terror.

This is especially true for those who are holding assets on their books that cannot ditch it by reducing the price and simply tick off their shareholders when they report the loss. Yes, I am talking about individual homeowners. Those that bought in the last few years and now need to unload their rising behemoth monthly payments.

For lenders it is a little easier to reduce and unload (sometimes) - take the Forrest Oak home for example. We have been watching this particular property for many moons and guess what...it ain't appreciating, unless you can say that it is negatively appreciating. I suppose that is like saying a home is positively depreciating. Boy, that is good one.

This place is down to $209,500. For Fannie Mae, who is currently sitting on this gem, there is a surface loss of about $69,500 if it is sold at the current price. I have my doubts about selling at that price, but we will see. But there is also the lost opportunity of investment that is not calculated.

In any case, since FM has had it for the last 7 months, they are averaging a loss of about $9900 per month. Here is some advice for FM - "You need to dump this dump."

Oh, and by the way, clean the carpets; it is doubtful, but it might help.

Those were the days...

Remember how important it was to hurry up and go out and blow your future possible earnings on a piece of dirt and some wood and nails called real estate? "You better hurry! If you don't buy now, you may never be able to afford a home!" Oh, how the sheep moaned.

At the time, I was amazed that so many people were making so much money and that they could afford these monstrosities. I kept thinking, "what am I doing wrong? I work hard and make decent dough - what's up with this?" It never crossed my mind that people would not only buy something that they couldn't afford, but that lenders would give them the cash to do it.

It almost hurts to post this stuff.

Well here is another one that will be heading to the auction block soon. If anybody shows up, bid low! Here is the description and the most recent price that they were looking to fetch:

10515 Ridgecrest Drive, Jackson, CA $629,000
One of the most desirable neighborhoods in Jackson - Perfect family home - Huge master suite on main level and 3 nice sized bedrooms downstairs - Great view of valley off covered porch and kitchen. Stainless steel appliances and cherry wood cabinets in kitchen. Nice home!

And here is the TS notice that goes with it. Notice the date of the "deed of trust". This means that this guy stopped making payments somewhere around January or February - just over 5 months after he bought it. Ouch!

PUBLIC NOTICE NOTICE OF TRUSTEE'S SALE TS No. 07-21584 Doc ID #000732569942005N Title Order No. 3340044 Investor/Insurer No. 1103611456 APN No. 044-440-006-000 YOU ARE IN DEFAULT UNDER A DEED OF TRUST, DATED 08/17/2006...will sell on 09/18/2007 at 12:00PM, At the main entrance to the Amador County Courthouse located at 500 Argonaut Lane, Jackson, California. The street address and other common designation, if any, of the real property described above is purported to be: 10515 RIDGECREST DRIVE, JACKSON, CA, 95642. The total amount of the unpaid balance with interest thereon of the obligation secured by the property to be sold plus reasonable estimated costs, expenses and advances at the time of the initial publication of the Notice of Sale is 484,287.25.

So, if this place goes for the $149 per sq. foot that the Charmstone Way house went for, I would imagine that someone could move into this pad for about $375k or so. Somehow, I am betting on a low ball bidder and a desperate lender that has one too many credit swaps and not enough cash to cover their soon to be screaming creditors.