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David's Macro Blog

Analysis and commentary on business, economics, real estate, financial markets, and other fun topics


Tag: Trustee Sale

“Taking the law into their own hands” is a phrase used to describe aggressive actions by people who feel slighted in such a way that waiting for traditional law enforcement isn’t acceptable.

Due to the massive foreclosure fraud (called “Foreclosure Gate”) perpetrated by the big banks, some Americans are fighting back.

Jim and Danielle Earl in Simi Valley, CA broke into their former home that was sold at trustee sale auction to a professional flipping company. The Earl family, with their attorney, Michael Pines, seized the home after the investment company fixed it up and were about to sell it to new owners. The police were there but did nothing to stop the theft of the home by the Earls.

How is this not breaking and entering?

The logical consequence of the banks’ blatantly breaking the law (see Systemic Foreclosure Fraud by Lenders) is that average citizens will fight back and take the law into their own hands.

Do we really want civil unrest? Can the government do anything to fix this quickly? Do two wrongs make a right…or just more wrongs? Share your opinion on this situation in the comments below.

Conejo Capital Partners, the company that bought the home at trustee auction tell their story here: 5893 Mustang

So, does anyone still believe that cheap credit and easy money from the Federal Reserve after the Dot Com Crash was a good thing?

More About Families Stealing Back Foreclosed Homes

By now we’ve all heard or read stories about disillusioned home owners (home debtors really) who haven’t made their loan payments in quite a while but feel that everything will work itself out. They may be working on a loan mod, short sale, principal reduction, or just the “free rent” program.

What tragic commentary on the situation we’ve created! The credit bubble bursting made 25% of home loans under water and foreclosure a likely outcome. There will be a whole generation of home owners and their children scarred by this experience just like the Great Depression.

Hat tip – Jim Klinge

Favorite Quotes

Realtor – “My name is Randy and I am a local Realtor…”

Homeowner – “Oh yes, I am quite aware that many of you low-life blood sucking vultures…”

”but we are in the middle of a loan modification so we are just FINE!

“I don’t mind at all you blood sucking vampire…we are behind 17 payments just like the rest of our social climbing friends.”

Realtor – “It appears I am too late, and you will keep your head buried in the sand because you actually believe you are going to get your loan modification…”

Last week I interviewed John Ray, the largest buyer of foreclosed homes at the Maricopa County (Phoenix area) trustee sale auction.  Through his company, Bid AZ Foreclosures, he currently buys around 100 homes a month on behalf of his clients.

Listen as he shares his knowledge and experience on topics such as: getting a good deal on a foreclosure, the amount of research it takes to compete, the old boys’ network (main players) at the auction, and much more.

Note: there are 4 parts/videos of this interview, about 36 min. total.

Original post for your reference: Interview with John Ray: How to Get a Good Deal on a Foreclosed Property at the Trustee Sale Auction and Avoid Common Mistakes

Here’s a video of live bidding at the Phoenix auction:

Purchasing homes at the trustee sale auction has become increasingly popular throughout 2009 as the real estate markets have firmed. 

When there is a big enough discount in the purchase price of a home at the auction vs. its full retail price on MLS, real estate investors will buy the home to either flip (resale) or hold for greater appreciation down the road.

Jim Klinge (aka “Jim the Realtor”) of San Diego interviews Adam Rappoport (aka “SD Realtor”), a realtor and active flipper of trustee sale homes.  This is a very frank and honest discussion about the risks and process of investing in trustee sale homes.

Adam Rappoport Interview – Part 1 of 3

Adam Rappoport Interview – Part 2 of 3

Adam Rappoport Interview – Part 3 of 3

There is a lot of mystery and uncertainty about buying a home at the trustee sale: there’s no inspection period, deep pocketed buyers pay all cash to buy the property “as is” and “where is”.

The interview really gets into some insightful and insider details in parts 2 and 3 so make sure to watch all of the videos.

What surprised me the most was how the margins have shrunk this year. Notice Adam mentioned that his target margin was 20% per deal but now it’s down to 15% and the current deal was at 9%.

Another interesting thing is that every property he’s resold this year has had multiple offers because his group priced the home right.

What do you think about this interview? Please comment below.

During our last visit in Scottsdale, Amber and I toured 3 houses purchased at the Maricopa County trustee sale auction in October 2009.

You can watch all 3 videos below.

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