patrick.net

Eight groups who lie about the housing market

I want to know who I should believe.

Strategist says

I want to know who I should believe.

don't believe anyone who is selling you something - especially not anyone in the real estate industry - until you understand the situation very clearly for yourself.

they have a whopping huge financial motive to lie to you. here's a good question for your agent: gosh mr realtor, if this house is such a good deal, why didn't you buy it yourself and flip it for a profit already, or rent it out?"

Strategist says

I want to know who I should believe.

don't believe anyone who is selling you something - especially not anyone in the real estate industry - until you understand the situation very clearly for yourself.

they have a whopping huge financial motive to lie to you. here's a good question for your agent: gosh mr realtor, if this house is such a good deal, why didn't you buy it yourself and flip it for a profit already, or rent it out?"

That's just silly. If they had to money to buy a house and flip they wouldn't be selling real estate in the first place.

Anyone that would incur a house sized debt without carefully researching first deserves whatever they get.

DieBankOfAmericaPhukkingDie says

bob2356 says

That's just silly. If they had to money to buy a house and flip they wouldn't be selling real estate in the first place.

Realtor racketeers have separate incorporated entities with long-standing relationships with banks to finance their speculations. They're in and out in a matter of weeks or days to get the biggest chunk of the gain on properties in play. One of the most frequent charges leveled at the profession during the melt-down was creme skimming listings. Realtors directly or through captives or straws would play a property and squeeze whatever juice was available out of the opportunity

Yea sure right. Most realtors are part timers who sell 1-2 properties a year maybe. Seems like you should become a realtor and make the easy money big bucks.

The exact opposite is true.
If I wanted to flip houses for a living I would become a realtor which would give me the inside access needed to guarantee success.

bob2356 says

That's just silly. If they had to money to buy a house and flip they wouldn't be selling real estate in the first place.

i think buyer and seller are responsible for funding the realtors.
the seller is the stupid one agreeing to give up 6% of the purchase price to sell their house.

for less than 1 grand the seller could
* hire someone to create a 1 or 2 page website for marketing the house, complete with pictures and all relevant data. just copy the formatting of a zillow or trulia page to get it right, or buy one of the thousands of html templates for selling a house for less than 50 bucks and fill in the details.
* purchase web site space and a url for your site
* put a sign on your lawn, put your url out into cyberspace sites like fsbo, craigslist
* make a sheet of paper advertising your house with tearoff tabs on the bottom, put in local supermarket bulletin boards and such.
* all advertisement should point to your url as the final destination for information.
* show your house by appt as needed, and bring 2-3 friends with you for security each time.
* line up a real estate attorney to do the paperwork when a sale is executed.
* on 250k sale, maybe spend 1-2% of the sale price to execute the above.

Agents claim the seller pay their

commission, but fail to mention that the seller gets that money from the

buyer. Think about it: who brings the money to the table - the seller or the

buyer? All money comes from buyers. No buyer, no money.

Yup, buyers can expect to be playing against a stacked deck today when dealing with real estate professionals. All realtors and attorneys are;licensed to list the properties and transact the order, but yet none of them are ever investigated or have their licenses removed for fraud?,

SoftShell says

i think buyer and seller are responsible for funding the realtors.

the seller is the stupid one agreeing to give up 6% of the purchase price to sell their house.

This can actually be shown pretty easily by comparing the sales prices of similar homes that are sold with realtor vs. sold for sale by owner. Realtors sell houses faster, but I don't think they get 6% higher prices. It's mostly the seller that pays the 6%.

You're missing one group. House Inspectors. After the inspector kills a couple of sales for the Realtor, that inspector will no longer be on the agent's "preferred" vendor list.

I once watched an inspector being trailed by a Realtor, with the Realtor questioning the problems that the inspector was finding.

Call it Crazy says

Most realtors just are looking for an easy sale and a quick, give away deal. They don't give a crap about the owners.

This is true and why all the stories about fake offers to make buyer raise their price is nonsense, IMO. Realtors want a quick and easy sale. They don't care about an extra $100 in commission.

I've had 3 occasions when buying that I was told there were multiple bids. In each case, I didn't raise my bid and someone else got the house. Which was fine with me. When I sold my house there were multiple bids and I saw them all. They were real.

You forgot the buyers also lie to them selves. People pressured into buying into neighborhoods that they know damned well they can't afford.
Since the fall of classic enonomics where savers are rewarded, and savvy consumers buy a house with in their means. Then through time and equity eventually move up.
New homeowners are comming right out of the box, as wanting their move up dream home from the get go.
When they know they don't have funds, the job, nor the whereital to carry such a high mortgage to a 30 year fruition.
It would kill them to live where the lawns don't grow because the residents are too poor to shrug off city hall's no irrigation order.

I find it quite shocking what bankers aren't taught or are trained to ignore. I bought a house last Thanksgiving. When I was going through the mortgage application, I supplied them with everything they asked for. While they were reviewing everything, I was putting together all the documentation we would need for being self-employed, expecting that they would ask for all that next. They never asked for it. They treated us as if we were employed. Now, I never lied to them. They were supplied with paystubs (which showed absolutely no withholding, as he was a partner, not really an employee), tax transcripts, which showed that all our income was filed through the s-corporation. For whatever reason, they insisted on seeing us as regular w-2 wager earners. I wanted the house, so I wasn't about to make a big deal out of it and cause delays... But, I'm an accountant. I WOULD notice immediately if you had a paycheck that had no withholding. I would want to know why a supposed regular employee pays no withholding. At the very minimum, I'd want to make sure that you had enough money (in addition to all the money you need to buy the house) but also enough money to cover your quarterly tax payments. Given all the stories you hear about banks making it very difficult for self-employed people to get loans, I was truly surprised by how much they DIDN'T want to classify us as self-employed... Even though from a tax perspective, that's exactly what we are. The evidence was right there, but either they don't know what they are looking at... Or they are choosing to look the other way... Very strange.

turtledove says

Even though from a tax perspective, that's exactly what we are. The evidence was right there, but either they don't know what they are looking at... Or they are choosing to look the other way... Very strange.

Loan officer's typically ask to see tax returns from the self-employed. That loan officer sounds new, because any experienced loan officer would of asked for it?

turtledove says

Given all the stories you hear about banks making it very difficult for self-employed people to get loans, I was truly surprised by how much they DIDN'T want to classify us as self-employed...

Don't ask don't sell.

Call it Crazy says

Had I used these "expert" realtors, I would have sold the houses for $20K less and on top of that, would have paid an additional 5%-6% commission on top.

Most realtors don't know crap from shit. They say you need a realtor to negotiate a better deal, but all they do is play messenger.
Pointing out the obvious like "this is the kitchen" Filling out forms, and bullshitting is all that is required to earn a massive commission.

Government agencies like Fannie, Freddie, and the FHA lie, because

their own existence (read "executive salaries") depends on guaranteeing private

loans with public money. These agencies are perhaps the largest scam ever

devised. Most people will borrow as much as they possibly can to buy a house.

The existence of Fannie and Freddie just make it possible to borrow yet more

money by pushing lending risk onto taxpayers, benefiting bankers with larger

interest payments, and harming buyers with higher housing prices. Ironically,

Fannie and Freddie drive up the price of housing in the name of "affordability".

The public is unlikely to ever understand this. The perfect crime.

This summary of the conflict of interest of institutions / government is all true. We dont need more bad laws on these conflicts of interest, rather as many have noticed the laws dont adress the root cause of the housing bubble which was conflict of interest, greed, and a hyperinflated interest in helping the poor turned into a cash cow for the listed groups.

A law needs to be written to mitigate these conflicts (Glass Stegall may have address some of them).

Buyer's agents lie,
Mortgage brokers lie,
Government agencies like Fannie, Freddie, and the FHA lie,
Banks lie,
Appraisers lie,
Newspapers lie,
The Federal Government lie,
Current owners lie

So most Americans lie, and the best that can be said about it is that they lie to themselves...