A Life Lesson, and a Professional One

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Or, Some Are Born Scum, Others Achieve Scum-hood, and others have scumminess thrust upon them.



I spent several hours Thursday "house-fishing". Kind of like people hunting for a house to buy for themselves, but I'm looking on behalf of clients. This eliminates embarrassing moments in front of clients, taking them to a place that may look great on the MLS, but has one or more factors about it that renders it a waste of the time I have with a particular client. I want the time a client gives me to be productive, and show them that I'm on the ball and know what I'm taking them to and that I won't waste their time. I really don't like taking clients to properties I haven't previewed. I won't do it without what I consider an over-riding reason, and there aren't many of those. But while out there, I had two really strong, "Some people are scum!" moments.



The first was mid-afternoon. I'd looked at several properties already and had half a dozen left to do. A little dog, maybe a Shelty or maybe a Corgi limped up to me when I parked. Poor creature looked dirty, bedraggled and hurt, but seemed friendly enough, so I petted her and got her calmed down. She had a license, so I called animal control, and the automated system gave me the owner's number. "Cool!", I thought, "I get to do a good deed today!" Called the number, left a message, left my phone number. She seemed willing to stay, so I was going to take a quick two minute look at the house while I left her outside, give the owner one more call and take her to the shelter. I've even got a couple bites of sandwich left in the car. Well, up drives an older man and the first words out of his mouth are "Bad dog!" That should have set alarm bells ringing, but it didn't, I'm ashamed to say. He apologized to me for her having run off, and she went off with him willingly. All was happy with the world, or so I thought. It wasn't until they were gone that I thought there were maybe some signs of, if not necessarily abuse, at least neglect. She was so happy to get some positive attention.



Then about twenty minutes and two houses later, my cell phone rang. Yes, they had owned a female Corgi - she was stolen about two years ago. I was standing there thunderstruck at what a idiot I had been. I hadn't even written down the license plate of the car the guy was driving. Imagine: Your dog is stolen. Two years go by, and you get a message on your answering machine that maybe, against all odds, someone has found your dog. Then the dimwit (that would be me) lets the thief make off with the dog again without even writing down the license plate of the car. I apologized, told the lady what neighborhood I found her in, and offered to at least describe the car and the man, and meet her and whomever else she wanted to bring at the corner closest, and we could all walk the neighborhood and look. If there ever is a next time, I'll write down the plate at the very least, even if the dog is wriggling in excitement and the six year old is happily crying that they got their doggie back.



Later on, something about the last house on today's route seemed a little familiar. No, I hadn't been there before. I couldn't put my finger on it, hard as I tried, and then I saw a picture, left behind on the floor. It was a guy I'd been working with about four months ago; he had been screwed badly by an unscrupulous lender. So badly that there was nothing I could do to salvage the loan situation. I priced him out with over seventy lenders, and the only place that would do the loan, the rate wasn't enough lower to help, and with the drop off in prices, then an appraiser I asked for a ballpark said the value had gone down so much that it was below that one lender's guideline. I felt rotten about it, but the only realistic solution was a quick sale. Comps suggested $455,000 as a realistic price, but the guy couldn't make the payments so I estimated the quick sale price was most likely about $430,000. Well, he was talking to other folks also, which was good and smart and I couldn't argue with the logic, and that other guy swore he could get the guy the loan. Well, the guy wanted to save his long-time home if he could, so I did the ethical thing: Told the guy while I sincerely doubted that a loan would actually be consummated given the situation (low credit score, high loan to value, and inability to document sufficient income), but if this other guy was certain, I understood and I wasn't absolutely certain it was impossible, just very unlikely. I basically got the heck out of the way of the guy's attempt to save his house.



Well, it's on the market now with a pending Trustee's Sale. It took me about five minutes to confirm the whole story when I got back to the office. This clown wasted the entire summer - peak buying season - trying to do a loan that I should have been more certain could not be done, while prices started to collapse, and then was rewarded for his perfidy with the listing, and since prices are further down now, and the guy trashed the place during the move out, I really don't think it will sell for more than $390,000 at the very most, and that's if it sells. If it doesn't, he gets a full-on foreclosure which is not something he can recover from at retirement age. Even if it sells for top possible dollar, it will end up with the guy having a net liability of several tens of thousands of dollars to the lender, or a tax bill to match for debt forgiveness if the lender forgives it. And I scored an assist for doubting myself, for not speaking out more strongly, for thinking that maybe someone else might be able to help where I couldn't, despite the evidence I get every day about what f-ing sleazeball incompetents out for a bigger commission no matter what it does to the client that so many people in my profession are.



(One of the earlier houses had a card with the agent's name, and the title was "Attorney/Realtor." Impressive enough, but he had left a Loan Worksheet there, promoting a thirty year fixed at 6.5% for "only" one point, or a 3/1 at 6.375 for "only" one point. Ladies and gentlemen, I have a 30 year fixed at 5.875% for that cost today, and a 5/1 at 5.625% for that cost. Last week, I had the thirty year fixed at 5.75% for that cost. The Dread Pirate Attorney's quoted loans have two points of yield spread on top of the point of origination he's charging. With the same assumptions he's using and no pre-payment penalty, I could do a literally zero cost loan - pay all the loan costs out of what I make and still come away with my usual compensation, if not more. That's the kind of difference shopping around can make.)



So I'm feeling lower than the repository of whale excrement right now, but lesson learned. From now on, no enabling the scum-meisters. I may not have been in it long enough to know everything, but I've spent enough time and effort looking for ways to make it happen, and systematizing everything such that I shouldn't be afraid to communicate in much stronger terms that something just isn't possible, and I'm going to start writing up contracts - simple written promises on a piece of paper - to give to people so they can ask the scum-meisters who promise something I know isn't going to happen. Sign it, or admit you can't do it. That way there's no pretense about it. If you really think you can do it, there's no reason why you shouldn't sign. I couldn't have saved the guy's house, but I sure could have kept the situation from being quite so bad - if I hadn't thought that just maybe somebody else might be able to do what I knew I couldn't and wouldn't pretend that I could. Yes, I am angry. Yes, I am disgusted. But I'm going to turn that around right now and start doing something positive about the situation. From here on out, nobody else gets victimized if I can do something reasonable about it.





Caveat Emptor.

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This page contains a single entry by Dan Melson published on October 14, 2006 10:00 AM.

Hot Bargain Property October 13th (#2) was the previous entry in this blog.

Real Loans: October 16th at 11:30 is the next entry in this blog.

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