Is that Scottsdale home really for sale?
It sure looks like it is. There’s a sign in the yard, property information on the internet, an asking price and everything. The comings and goings of Real Estatey type people with wide eyed gawkers in tow confirms that the quaint Spanish hacienda is looking for a new owner.
Or is it?
There is a disturbing new trend in the Scottsdale Real Estate scene: the fictitious listing.
By now, anyone who is not somewhat up to speed on the short sale market should be stoned to death with the rock under which he has been sleeping. Get used to them, people, as they are not going anywhere anytime soon. Though we all know the uncertainties and complexities involved in a short sale transaction mean that the listed price is not necessarily the real price, we generally take for granted that a seller is actually interested in selling.
Given the rise in anecdotal reports of would be sellers who haven’t made payments in two years while attempting to consummate short sales, you can imagine what the more entrepreneurial freeloaders in our midst have concluded: going through the motions of a short sale for the sake of appearance can keep the bank off one’s back while he lives rent free for as long as the ruse will allow.
Financial institutions are not so naive to believe such subterfuge never happens, so it typically takes a viable offer on a property to postpone a trustee’s sale (Arizona’s version of a foreclosure). That’s where you, the buyer, come in. For the “seller” interested in staying in the payment-free property for as long as possible, the facade entails the procurement of an offer for submission to the bank. Whether the seller intends to actually complete the sale or not.
In essence, the prospective buyer could get strung along for months by a seller who is just buying time. Or stealing time, I should say.
Perhaps his credit is already damaged beyond repair. Perhaps he doesn’t want to bring any of the money to the table that the bank demands. Perhaps he does not qualify for the short sale at all (yes, a seller does have to meet certain qualifications to gain bank approval). Perhaps the seller is simply bitter beyond reason and unwilling to let some buyer have his home for pennies on the dollar. Whatever the reason, there are properties on the market that aren’t really available.
How do you identify those shiftless wasters of time before embroiling yourself in a slow, emotional death? There are a few tactics that a competent buyer’s agent will employ when separating fact from fiction on a short sale offering, but none is foolproof. Short of peering into homeowner’s soul, all one can do is take basic precautions to assess the viability of a sale. Unfortunately, the determination of what the owner can do is not necessarily indicative of what he will do.
The guy could be dealing with you in good faith, or he could simply be using your offer to delay his inevitable foreclosure.
My advice? If you are going to go the short sale route, start with properties that have been through the process to the point that they have a bank approved price attached. If the seller is playing games in this instance, at least the process will resolve itself faster and allow you to move on down the road. If you fall in love with a home that has not yet been approved for a short sale by the bank, make sure the appropriate questions are answered and that the listing agent has a competent record of successful short sale transactions. The good ones are adept at separating the viable candidates from the disingenuous types as they have a vested interest in getting the transaction to the closing table as well.
At the end of the day, though, you just never know what is in store from one short sale to the next. With all of the variables to contend with in the best of circumstances, adding the integrity and intention of the seller to the list of concerns is almost comical in a tragically masochistic sense. All the more reason I recommend avoiding the short sale quagmire unless all other avenues have been exhausted.
It’s a beautiful Scottsdale home alright, but is it really for sale?
There are things that you, as a home buyer, want to know about a prospective new neighborhood. Are the schools top shelf? Is there shopping nearby? Do the neighbors hold a semi-annual Scott Baio look-alike contest? For the most part, your agent can help you find the answers to your questions (though determining a victor in that last one seems dubious given it has been a couple of decades since Charles was last seen in charge). There are some matters which may be pertinent to your purchasing decision that I cannot field, however.
Fair housing doctrine is the result of a noble pursuit to ensure that all consumers enjoy shared basic rights and equal housing opportunity. The so-called protected classes against which housing discrimination is strictly prohibited include race, color, religion, gender, national origin, persons with disabilities and familial status (having children under 18 years of age).
(Note omissions such as job description and political affiliation from that grouping. Don’t like Realtors? Democrats? You don’t have to sell your house to one. Of course, green is the only color that should matter to a home seller, and rejecting any potential suitor for a reason other than unacceptable contract terms is not only foolish, but an invitation for trouble. Protected class or not, this is America. You can sue or be sued for virtually anything.)
Now that we have established who cannot be barred from housing opportunities for no other reason than certain personal attributes, let’s take it a step further. A frequent criticism of Realtors is that we won’t answer your direct questions when you are trying to get the skinny on an area. Your pointed questions are met with milquetoast answers such as, “There are all types of people in this community,” or “You should go to the police department website to research that on your own.”
It’s not because we don’t want to be helpful. We do. Believe me. Many times, we are constrained by overbearing legalities that make it difficult to effectively advise our clients. While laudable, fair housing doctrine in practice can be maddeningly frustrating, too. I cannot tell you how many Christian families live in the neighborhood. I can’t tell you if a subdivision is kid friendly. I can’t tell you if an area you have inquired about is a “bad part of town” or not. I can’t give you the wink and a nudge as I drone on about not being permitted to discuss such matters.
When you, as an unknowing consumer, stray into the no-fly zone, the exchanges often go something like this.
Q: “Are there a lot of minorities in this area?”
A: “There are people of all kinds in this neighborhood. I am not at liberty to discuss such things. Please get out of my car you intolerant ape.”
Q: “Are there more families or singles that live in this neighborhood?”
A: “There are people of all kinds in this neighborhood. I am not at liberty to discuss such things. If you are trolling for a date, I suggest the local pub … maybe Facebook.”
Q: “Is there a lot of crime here?”
A: “That depends on whether you consider vice a victimless crime … er, I mean, you would need to check the local PD’s website to review those statistics.”
Q: “Are there any agnostic Madagascan women who walk with a limp and have six adopted Inuit kids nearby?”
The thing to remember is that we agents deal in properties, not people. Ask me about the community amenities, the builders, the values. Shoot, you can ask me for the square root of the Pythagorean Theorem for that matter (the answer is “F,” by the way). Just don’t ask me to lay out the area demographics for you. There are resources available to you should you wish to perform your own investigations, but as a licensed agent, I cannot steer you to or from a particular area based on criteria that either closely treads or firmly stomps on a protected class.
Of course, it would be naive to assert that no agent has ever flaunted these guidelines to provide a client with the information sought. Were it me in the consumer’s shoes, I’d worry where else said agent would be willing to bend the ethical spoon, but I digress.
Are there times when I feel constrained from fully doing my job and properly advising my clients about both the positives and negatives in a community? Absolutely. As a safeguard that prevents agents from feeding into arcane prejudices and stereotypes, however, it is necessary to ensure that we don’t artificially impact values or deny opportunities. You can, and should, do all pertinent investigations regarding the property you aim to call home for the next who knows how many years. You are not restricted from obtaining the information you seek. Just know that your helpful agent will not be able to abet certain fact-finding missions.
You can ask me if the house is far enough away from the meth lab down the street to withstand the inevitable explosion (it’s not). Just don’t ask me to speculate whether the aspiring chemist within is here legally or not.