Julys

Iargo Springs, MI

Not gonna lie. For the most part, I am not a fan of July. First, there is the heat thing. I am not a fan of heat. I intend to become a snowbird in my later years. As an added feature to my anti-July stance, there is now the whole "this is the anniversary of Bonus Mom's life and death thing." Hopefully as time goes on, that one will be easier. But not the heat. I hate the heat.

Au Sable River, MI

In addition to the above, this July was rough because of emotional travel and illnesses. I need neither again any time soon.

The Remnants of a Birthday Party for a friend who turned 50

But this July does have a happy ending. The Diamondbacks are in first place again. Yea, there are other happy things this past July (friends and family kinds of things), but they are a bit personal, so you can have the glass is half-full base reference. But I threw in a few happy July pictures anyway.

Last Call

I have nap envy. 

The Margarita Transaction almost didn't get this far. Last week, my loan officer was making vague comments that suggested I call the Vatican for canonization, or perhaps the Justice Department and get a sworn statement. The loan officer had done his very best and wasn't sure how this would reflect his Final Judgement. Either way, my clients weren't showing a cut and dry case that they qualified for the home that was supposed to close last week. The loan officer was now in the middle of this and had the dubious honor of getting an underwriter to agree to give my clients a loan. Or, perhaps call someone legally and have my clients' background scrutinized. I don't know. I didn't ask.

Anyway, three (yes, three) underwriters later, there has been loan approval! In fact, we went from, "I am not sure what to tell you" to "guess what, we close on Thursday," which was news to all of us.

In addition to all of these shenanigans, the sellers were being the sellers. I might have mentioned this guy? A retired engineer, he knows more about real estate than everyone else in the universe. He relies solely on Zillow because the Internet is always true. He insults his agent and calls me whenever he wants to and leaves painfully long messages that I don't bother listening to.

I should have taken a picture of all the junk in
front of the car and behind me. Because this
photo makes the garage look downright sparse. 

There was also this minor matter that I have strep throat and have been in bed sleeping for the past five days, so I haven't truly cared about baseball, much less any of the above.

Except, Wednesday. And I only cared on Wednesday  because I found out Wednesday afternoon we close Thursday. And, that means a final walk-through had to be conducted. In all fairness, everyone found out Wednesday afternoon we close Thursday, but that shouldn't have been an issue. We were supposed to close last week. The seller allegedly had moved out. Right?

So we had a final walk-through yesterday. The players for the first five minutes of our walk-through were Mr. and Mrs. Buyer, several of their children, myself and Marty--who only came along because I am too sick to drive. Then the seller came. First, he walked right up to Marty, patted him on the back and started talking like they were buddies. Marty said something about remembering they had worked together once (they had, actually) and suddenly it dawned on Mr. Seller he wasn't talking to Mr. Buyer, which in itself is funny, because Mr. Seller followed Mr. Buyer around for an hour the first time they were in the house so you think he might remember him. So, without any sort of pleasantries, Mr. Seller walked away from Marty looking for Mrs. Buyer. He then zeroed in on me.

Now, I am not feeling well. In fact, I was sort of propped up against the wall when he walked in. (did I mention the seller wasn't supposed to be there at ALL? This was the BUYERS' walk-through) He extended his hand and when I didn't extend mine for sanitary reasons, he grabbed it anyway, giving me his best his-mother-taught-him-right smile with a, "How are you Mrs. Buyer?" When he found out I was the agent he had been leaving countless messages for, he again rudely walked away in search of his true victim. And that was probably best, because by then I was ready for a nap.

When Mr. Seller finally found who he was looking for, he announced to all of us that there had been some mistake. We weren't closing on Thursday. We were closing Friday. Why? Because he said so. And he controls the Universe.

So sorry I didn't take a picture of the real ginger-bread house.
This one is cuter. And plus, another car. 

Unfortunately, that's not what the loan documents say, so too bad. I tried to explain it to him, also I took a moment to tell him that anything left at the house would belong to the buyers so he might want to use this time to get the rest of his belongings out. Like the 1964 1/2 Mustang in the garage. It would be a shame if that got left at the house. And perhaps he could load up the 'Stang with all of the other odds and ends (vacuum, do-dads, 18 year old gingerbread house, cleaning supplies, refrigerator that was now in the back yard instead of the kitchen), and get them out too. But I am pretty sure I said it nicer. I think. Then I texted his agent and said, "Guess who showed up uninvited to the party and won't leave?"

Mrs. Buyer and I had a fun time watching Mr. Buyer be dragged around by Mr. Seller, getting schooled on how "awful" the home inspector, termite inspector, roofer and AC tech that Mr. Buyer hired were and "what a waste of money" it was for Mr. Buyer because everything on that inspection report was wrong. Wrong! However, he fixed it all anyway.

And then Mr. Seller spent about an hour going through everything he fixed. He showed Mr. Buyer how to take care of the pool (Mrs. Buyer almost lost it on that one, as they own a pool company and their truck was in the driveway). He also magnanimously announced how he was leaving all sorts of helpful items for my clients, such as exterior plants, pool equipment, dishwasher, window blinds and towel bars. Of course, the contract says he has to, but I wasn't going to argue with the guy who controls the Universe. Instead, I laid on the staircase landing, just trying to nap.

Meanwhile, the agent and I were texting back and forth, with me making sure he understood there was a lot of things left in the home and no matter what his client thought, this was closing tomorrow and would he please make sure his client understood this?

"That's not what Zillow told him," the agent shot back.

"You need better clients" I said, because at this point no nap was coming and agent and I are the best of pals.

After it was all said and done we were there an hour and a half for a 10 minute final walk-through. The agent and I talked later Wednesday night. Did the seller understand the house had to be empty and he had to leave the garage remotes and keys behind? "Not really. But I guess your folks could charge him rent if he stays," the agent replied.

Team Light Bulbs

My weekend of grieving was interrupted by strep throat. Thank you Buckaroo for this gift. It was probably for the best. Sleeping was a lot easier than thinking. This morning I got a few pictures from Bonus Mom's sister with a note to me. I smiled when I saw them. Isn't that what healing is supposed to do? Let us smile when we see those who we loved and have left us?

Unfortunately, my clients and the agents involved really don't care if I feel miserable and all I want to do is down shots of liquid Tylenol and sleep. So, this weekend I negotiated a peace treaty which went something like this:

Me to Client: the seller wants to get back into your house and take another look because the home inspector says none of your lights are working.

Client (with a reasonable, yet annoyed, timbre to her voice): so we need to inconvenience the tenant again?

Me: Yes. If this isn't acceptable to you, the seller is going to ask for you to pay an electrician to go out there and change the light bulbs or rewire the home.

Client: Let me make a call to the tenant.

Me: Is there a chance there is a problem with the electricity?

Client: There is a better chance the tenant just hasn't changed any light bulb in the past 5 years.

I actually agreed with that, but it was best to gain access to the home anyway. I set this up for tomorrow, with the hopes that by the time I find antibiotics (on the list for today) I will have enough energy to drive over and run interference with the selling agent and the tenant. If not, they are on their own.

In other news, the client of the margarita transaction texted me today. "We just electronically signed a Closing Disclosure! That means we get keys, right?" No that just means she will have lots more paper to sign (in the presence of a title officer) later this week and then will get keys next week. But I wasn't sure I got through to her. I had been awake for five minutes and I was ready for my next nap.

One Year

It has been a year since Bonus Mom left us. I have thought of little else lately. I suppose it isn't emotionally healthy. Then again, if someone can show me emotionally healthy grieving and give me a standard to aspire to, I would appreciate it.

Knowing this dubious holiday was in the works, I took Friday off, figuring I wasn't going to be much use to anyone anyway. Sunday would have been her 76th birthday. I am probably not much use to anyone that day either.

A friend once told me the tears flooding my head eventually fade and they are replaced by happy memories. I see that gradually happening, but I am not there yet. Bonus Mom always swore it took me longer to catch on than most.

Jane suggested I take today to do something Bonus Mom liked to do. So, I am. Bonus Mom taught me to write like a grown-up. So, that's what I am doing today. I am writing.

When I am done, I will probably cry some more and maybe I can find a way to laugh and smile while I think of her too. I miss her. I am grateful she stepped into my life when she did. I am grateful she chose me to be her almost daughter, because it was a choice. She didn't have to.

Wanna Sell Your Rental?

The Look of Every Landlord Everywhere 

My marketing method of choice is mail. It is more expensive than social media, but at least before my flyer/postcard is thrown out, someone touched it. And perhaps they remember touching some similar piece of mail before. Through the years, I have had enough Pavlovian success with this method to make me come back to it time and time again.

Today I sent out postcards. This campaign is directed at landlords who are pretty much complete with being landlords, which is a topic near and dear to my heart. As I addressed each card, I tried to envision the recipient looking at the picture and thinking, "Yea, I should call the number on the back."

My graphic artist friend, Scott, helped me design the postcard. It went through a committee review (consisting of Marty, Buckaroo, Polly, Ollie, Finn and a few other folks with opinions). Is it the greatest marketing campaign ever? Probably not, but all I need is one call to make the campaign successful. Just one.

Houses? What Houses?

Fifteen year old Buckaroo, drenched in sweat, had a moment of clarity last week. "What you do isn't about selling houses," he said with a bit of wisdom. Part of this revelation came from the fact he had just spent several hours in a hot house helping an 80 year old man move. But, he was right.

Very little of what real estate agents do has anything to do with the actual house. It has to do with the people. This past Sunday, after 8 p.m., I was on the phone with another agent, a home inspector and my client, renegotiating the start time for the home inspection. Why? Because the home inspector announced if they couldn't get into my listing at 7 a.m., life would end. However, I wasn't about to let them and I wasn't about to break it to the tenant they had to let in a perfect stranger at 7 a.m.

In the end, the rest of us managed to convince the home inspector he had to pick a different time. Also in the end, I showed up on the tenant's doorstep yesterday with movie passes so he and his family had something to do for a few hours while the home inspection took place. None of this had anything to do with a house. It had to do with accommodating folks who are being inconvenienced--except the home inspector, who is not happy about the time change. Can't win them all.

But this is minor in the grand scheme of things. Jane's story is not.

Last week Jane had a closing. Her clients were an 80 year old couple who had been in their home for 30 years. These folks had built this home, raised their children there, played with their grand babies in this house, and sadly, watched one child pass on. All in this home. However, once it closed the owner wasn't in a great hurry to leave. Of course, that meant the buyer couldn't get into the house either. But fortunately the buyer was out of town.

So, though the home closed on Thursday, he still hadn't moved out on Friday. He even told Jane he wasn't leaving until the buyer verified with him personally they were turning on the water, because he didn't want the plants to die--and he had no problem spending the weekend in the house. Jane explained, they weren't his plants any more, but that didn't deter him.

Jane also had lined up movers earlier in the week for the seller. The same movers the seller fired as soon as they set foot on his property. This 80 year old man would be loading the Uhaul by himself, thank you very much. He didn't need to pay $200 to some guys who were willing to work in the 100+ degree weather. (by the way, the house he sold went for more than $500,000--all of that was proceeds to him, so the $200 wasn't the issue).

Friday morning, Jane called me in a panic, what was Buckaroo doing right then and there? SHE would personally pay him to help her clients move out of the home. Then she picked him up and brought him to the seller (who, by the way, does have another place to live). Jane held the wife's hand throughout the day as she cried about leaving the home she loved. She bought Gatorade for Buckaroo and the husband (who kept firing Buckaroo because he was loading the "damn Uhaul too fast" and they needed to take their time, as he was in no hurry to leave). When the truck was loaded and Buckaroo officially dismissed, the husband then broke down and cried like he had never cried before. Jane was there for him.

I am glad Jane was the agent for them. Comforting, loving, understanding--that's the kind of thing she was born to do. Jane also followed up a couple of times this week to make sure they were settling in nicely.

Zillow doesn't talk about this kind of thing. Moving can be such a personal and emotional experience. What I do is rarely about the house. It is always about the people.

Public Service Announcement

If you are getting a mortgage, please, PLEASE find a loan office who resides in the same state you live in. Don't go to Joe's Loan Service, located in Ottumwa Iowa because you were given his name as a "preferred referral partner" of some big warehouse store. Joe's Loan Service doesn't know the ins and outs of real estate transactions in your state (unless you are in Iowa). They can cause you lots of heartache.

They can also cost you lots of money if they don't play by the rules of the contract. One underwriter, where my client refused to listen to me and use a local company, said, "well, we didn't write the contract," and therefore, didn't feel compelled to work with any expediency. My client was out $5,000 if the loan didn't close by Monday. The underwriter didn't care, he got a pay check either way. (the loan closed. A letter was written to the president of the company with lots of mulit-syllable words and the nasty e-mails her employees sent to me attached as further evidence her employees needed to dislodge their heads from where ever they were lodged and learn to do their jobs).

Even if you own a home and are refinancing, please, PLEASE don't use an out of state lender. There is a loan company (whose name rhymes with "sticken loans") who doesn't feel title insurance is necessary--so their fees are lower because they are missing this integral component. Even if you don't know what title insurance is, I promise you IT IS NECESSARY.

Stuff like this scares me.

Sometimes these out of state lenders promise my clients the moon. They promise lower closing costs. A lower interest rate. Or they offer to throw in the cost of the appraisal. That's nice and all, but there are loan officers locally who can do the same things if one asks.

Update

Well, Dee and Her Merry Band of Felons will close on their home today after all. The termite issue has been resolved, with a perfectly reasonable explanation: the termite company doesn't drill near gas lines. Actually, this reason this was the consensus this past weekend, but it is always best to verify than assume. That side of the home, by the way, was treated for termites, the company just didn't drill into the concrete.

A Day in the Life

See those discolored circles in the concrete? Yea, they should be on the East side of Dee's house. They aren't. 

Dee and Her Merry Band of Felons are supposed to close on a home tomorrow. When we conducted our final walk-through yesterday we found a small hiccup. And--I can't believe I am writing this--the termite treatment folks forgot to treat one side of the home.

Think of it this way. The front of the home was treated. The west side of the home was treated. The back of the home was treated. The east side, not so much. So, now we are holding up the close of escrow (hopefully for only a couple of hours) to resolve this.

Tri-Investing

Ginny wrote me, giddy, she found THE investment for her. What she found--and I have no idea why the agent put it in the multi-family unit section of the MLS--was three individual rental homes for sale. If you added up the prices of the homes, you had the number the seller wanted. And, it was a lot.

But it wasn't a tri-plex. It was three homes for sale. It was three mortgages to qualify for. It was three properties to individually evaluate. It was three down payments. It was three times the challenge she could expect.

Because she asked me what I thought, I gave her my most neutral answer. I didn't know what the CAP rate would be because I didn't know her mortgaged amount, and what did she want for a CAP rate? If she was analyzing these properties based on cash-on-cash rate it would depend upon how much she put down ("I know you are aware you will need 20% for a down payment. However, that is about $90k more than you told me you had. Will you be able to obtain those funds?"). And, as she can see, her gross rent multiplier can't be factored because the agent put in pro-forma rents. And which method was she using to analyze this deal?

By the way, "pro-forma" rents are pretend rents that the seller thinks the property can rent for. What it really means is the property is vacant and in this case the owner is optimistic.

The rest of the jargon on the above paragraph you don't need to know. I am guessing Ginny doesn't know it either. But if she is serious about doing this, she will need to learn.

I also reminded her if she were to buy three homes in one subdivision, nobody moving in could qualify for an FHA loan at that point. So, that means there would be more investors buying in that neighborhood and that might change the values and the socio-economic makeup of the neighborhood when time came to sell.

I suggested starting with one home. Heck! Even a townhome! Just start small and work her way up. Or, if she wants three properties, buy three townhomes. I really want to help Ginny. I have a soft spot for investors. This is where I started in real estate, working with investors. However, I don't think Ginny is ready for this. 

Bad MLS Pictures The SRBBE* Edition

*Self Righteous But Bruised Ego

So, I was contacted repeatedly by this couple--past clients--to sell their home. I gave them my best, based on experience and all the data I had available, guestimate and it was $35,000 off what Zillow promised them. So, they didn't use me. They also didn't get the discounted commission that goes with being my repeat client. I always suspected the wife hated me anyway, she sure made my life a living hell last time we did a sale together.

Marty says this is a blessing in disguise. I know he is right. I couldn't in good conscience have listed this house so far off what it was worth. It would have been doing them a disservice. Plus I would have been abused by the wife for my inability to sell her home. I have lost sales before for similar reasons (wives hating me, pricing, I wasn't the right agent, whatever) and I have probably gotten listings because the clients went with the agent who promised them the moon and couldn't deliver. It all works out in the end. If they can get this outrageous price, the more power to them. I hope they do get their price.

Anyway, here are the pictures the agent chose to put in the MLS. The home is actually really cute. Unfortunately, you probably can't tell. Just to be clear, there are no living room, family room or bedroom photos. I assure you the home has all of them. You can see the kitchen picture below. These are in order of appearance as one would see them on the MLS, Zillow, Realtor.com, etc.

This is the primary picture on the listing. So, everyone sees this first. 

There are two of these pictures in MLS. 

The kitchen. There are two of these in the MLS too.

This is the ONLY front of the home and yard picture

I love the shadow on the right. 

Awkward Questions

Last week a former client put me in touch with her bestie. Bestie's husband has a job interview and they may be moving to the Valley. Could I help them? Sure thing.

I should preface this by saying this was a phone call, which was probably good, because once it went South, I was able to get off the phone. Based on what she told me (her husband would be working 40 miles East of Globe but wanted to live in the Valley. He could commute, she assured me), I suggested Gold Canyon, Mesa or Gilbert. She wanted reasonable schools. Those were the closest communities to where her husband's job would be that would touch the Valley and met her criteria. Personally I think the commute would get old in about two days, as it still at least an hour and a half away from where his potential job would be.

After we pleasantly talked for about ten minutes Bestie threw this at me, "My husband and son are black. Will they fit in living in any of those cities? We need to live in a neighborhood that has blacks so my son won't be alone." In 2018 I am getting a flagrant fair housing trap thrown at me. Whether intentional or not, (let's hope not), if I even begin to answer that, the fines are outrageous and my errors and omissions insurance doesn't cover the amount of money I would have to pay out if I said something to even suggest I understood what she meant.

And frankly, why would her son be alone? Never mind.

I am not sure where to go with this person, but I will wait to see if I get a return phone call.

Then there is Ginny. Ginny found her dream investment opportunity and threw it at me. "Is this a good investment?" she asked. I can't answer that either. A good investment to me may not be a good investment opportunity to her. I don't make those decisions for other people.

Buying property, especially when one is from another state (like Bestie) or trying something completely different (like Ginny) is a vulnerable experience. As someone in sales, I desperately want to be the people pleaser and answer everything I can to help them be as comfortable as possible. Yes Bestie, there are blacks, Samoans, Asians, whites, leopards, zebras and space aliens in Mesa. HELL NO what you are looking at is a terrible investment, especially if you don't know what you are doing--which you don't, Ginny. But I can't. It is like raising children in some ways. We may know what is best, but they need to find out for themselves to make the lessons stick.

Bonus Family

Bonus Dad at Bonus Mom's Grave Site

Last week I went to northern Michigan for Bonus Mom's memorial. It was a small affair. There were tears and laughter. Lots of both. Some people are worth each and every tear. Bonus Mom was one of them. She was also worth each and every smile, chuckle and deep belly laugh.

Family is a funny word with loose definitions. We have the family we are born with. We can have the one we marry into. We pick neither of those. Then there is the chosen family. I have very close friends as well as two two nephews-by-heart, one who has a wife and daughter. I would move the Earth and Sun for them if they needed it. I would do anything for my Bonus family I was with this past week. I love, love, love my blood family. I accept my husband's family. But I cherish the family I chose and who chose me.

How To Get An Offer Rejected

1. Continually call the listing agent (me), telling me you have been in this business for x number of years and back in 19xx you conducted real estate your way. Therefore, nothing has changed (except for a few laws, standards and practices) and you will still do it how you did back in the day. Oh please! Let's start off every relationship with other agents this way. And by the way, the barrage of text messages at 5 a.m. were a nice touch.

2. Submit an offer that is $40,000 less than the asking price. Be sure to say lots of negative things about why you client hates the house in an enclosed letter. Also, it is fun to include "after we exhasted the opsions, we decided to look at youre house." My seller will be charmed.

3. In said letter, be sure to have your buyer not spell check, use punctuation or any standard grammatical practices. My seller will know you are serious about purchasing. My seller will also know a lot of other tid-bits about you. You are what you write.

4. As the buying agent. Write such things in the contract--the contract your broker will be delighted to read--such as "cellers piade," "muchal" (seller's paid, mutual)  and, by all means, spell my sellers' names wrong. They love that.

5. Write in the contract your buyer will be paying the earnest deposit with money orders. Classy. In this day and age, why not a cashier's check or wire transfer? Can one get a money order for $3000?

6. Ask for $18,000 in closing costs. Yes, you read that number right. The seller wants to pay that much in buyer closing costs. In fact, I am sure everyone selling a home would delighted to cough up that much money for a buyer. And by the way, when you are asking for a crazy sum of money like that, please, don't give an explanation. Sellers have imaginations and crystal balls.

7. Definitely write to the selling agent and say, "I expect your sellers will counter." Nope. They have no desire to play this game. Give us something reasonable to work with. Thanks.

I would like to tell you this is one contract. I really would. In less than a 24 hour period, my seller rejected three offers. I don't blame them. I didn't even want to submit them.

Ginny

Twenty five percent of Ginny's trouble in her plex-buying adventures is that she doesn't have enough of a down payment. Specifically, most legitimate investor loans require at least twenty-five percent down. Additionally, to really make any money as an investor, it is best to buy real estate for cash. Barring one doesn't have a quarter of a million (or more in the AZ market) to put down on an income property, it is best to put down as much as possible. That way, the income property brings in cash flow as one sits on it waiting for the market to go up.

Another twenty five percent of Ginny's trouble is that she is not factoring for silly things like expenses. Mortgage payment aside, there are always expenses. Things break. The more necessary the widget the more expensive it is. For example air conditioners are necessary. There are other expenses such as taxes and insurance. Depending upon the kind of loan there could also be mortgage insurance, which could be in the avenue of $200 to $300 a month, depending upon the loan. And despite what the books are telling Ginny and her friends, sometimes the rent doesn't get paid or doesn't cover the costs of expenses.

The last fifty percent of Ginny's trouble is that she knows nothing about real estate investing. This will be the fifty percent that will go away the quickest once she gets going, because there is nothing like experience to teach someone. Of course, what she is relying on is the experience of others, in this case a few books and some investor shows on cable--and those cable shows are always real scenarios, right? Fortunately, she doesn't seem the type to pay for the seminars that come into town and promise riches. I give Ginny credit for brains on that one.

(Mental note, I must write a rant about those seminars sometime. Argh!)

What Ginny does have going for her is time. She is taking her time. She is paying attention to the market (so far). She is listening, at least partially. She is bright and I can tell wants to invest smartly no rashly (barring any loan fraud challenges, which I think we cleared up).

The reason I got into real estate to begin with was I had a fraudulent experience with a real estate agent who said she had been in the biz for 12 years. She had been selling homes for 12 weeks. I gained my last fifty percent (just like Ginny will) from the school of hard knocks. Frankly, we did well on that house. In the end, I sold it for sixty percent more than I paid for it to a gracious and lovely family. It wasn't my best transaction, or my worst. But it is one I liked the most. I hope I can offer Ginny the kind of help that will make her more savvy.

Complex Plexes

I had a delightful chat with Ginny the other day. She is a referral from someone I know. That particular person once wanted to rent a home with such wild and unrealistic expectations we didn't work together. Come to think of it, that person actually knows Mrs. Worrier, another specimen with wild and unrealistic expectations...

I am seeing a pattern.

Anyway, Ginny called. She and two friends have been reading investment books and want to buy either a duplex or a four-plex (not sure why a tri-plex isn't part of the formula) in Mesa. But, it has to be a bargain and it has to be in a safe neighborhood.

Of course it does! All investors want to give their properties away. And of course, all apartments have to be in safe neighborhoods. That's where they are all located! Just ask Marty, who when moving to Phoenix in his 20s lived in an apartment where a human leg was discovered. Safe.

Ginny was so sweet. She was so eager. She was so well-read on the matter of buying investment properties. However, it was obvious the books she was reading were written in 2001 and were written to sell books, not income properties. For example, one of her books--and the the one she glommed on to for the majority of her wisdom--talked about how one could buy one of these plexes with little money down. According to the author, there are two fabulous ways to do this. The first being seller financing, which is a great method if you have a foolish seller and a soft real estate market. It is also somewhat questionable since 2009 when the Dodd Frank Act came into existence.

The second way was with an FHA loan, which allows the borrower to put as little as 3.5 percent down on a home they will be living in. When I pointed out the significant flaw using FHA, she said she would just tell the loan officer she was living in the fourth unit. Yea, because loan fraud is no big deal. And no loan officer would see right through that. Plus, I guess, I am supposed to turn the other way once I know this, right? I did explain to her people (such as real estate agents and loan officers) go to prison for loan fraud. She found that to be a shocking notion--prison that is, not loan fraud.

The way we left it was with me giving her the name of a couple of loan officers who might be able to help her with hard money lending (think Guido's loan service, with nicer terms and who believe kneecaps are a God-given requirement in life). I also contacted the loan officers to alert them to her "Hey we can call this our primary residence scheme and nobody will mind," philosophy. One loan officer told me they have programs for investors that might work and keep everything legal. Glad to hear it.

I also called my commercial real estate friend Bill. I have sold plex properties before, but it has been 10 years since I touched one. (I also tried to buy a couple in my investing hey-day, but the numbers didn't work out). Bill said he would help if I needed it, which is good, because if Ginny actually gets this plan off the ground, I will need it.

Cooperating Tenants

I'm not making this up

So I have this listing. The owner is a personal friend (and once-realtor) who moved to another state. She has tenants in place and has made them a smoking deal. If they cooperate and the buyer is an investor they will stay and get some $ off the rent for a month or two. If they cooperate and the buyer is someone who wants to live in the home, the owner will pay them a generous sum to leave.

The tenants have been wonderful. They are cooperative. They make their beds. They allow for showings and (sometimes) even leave so the buyers can have privacy. However, they aren't leaving the place in "showing condition."

In this market, anything marked as active for more than a week, looks to be stigmatized or over-priced. Honestly, having to put "tenant's rights" on the listing is a form of stigmatization. Agents don't like to show homes with tenants in place for a variety of reasons. One of those reasons happens to be tenants like to talk. "This is broken." "The owner was too cheap to fix..." and other such disclosures which does nothing to sell a home.

But the big reason why agents don't like to show homes with rentals is that even cooperative tenants aren't cooperative. What they truly are is passive-aggressive. For example, these tenants may keep the home clean, but they didn't put the closet doors back on the closets, nor did they patch and paint the walls. There are tools, debris (like a hay bale) and half-a staple gun outside. In fact, one can't walk to the front door without passing the dead brier bush out front. At the front door, please ignore the spider web and the random pieces of junk decorating the front patio. And by all means! Please make sure your tetanus shot is up to date!

Apparently, I sugar coated the condition of the home to the seller. I hadn't realized this until I sent her pictures and she was horrified. I know this because she instantly wrote me and said, "I'm horrified!" I understand. She has certain expectations: she wants the home to be in such condition a buyer will fall instantly fall love with the place.

The tenant on the other hand has the expectation the buyer will instantly hate the place and will be so turned off the home won't sell and they won't have to move. So far the tenant is winning.