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| | Author | Messages | |
Rob
Posts:13
 | | 08/13/2007 4:42 PM |
 Alert | We decided to buy our home in Maricopa in July 2004. We chose a 2113 sq ft model in Cobblestone Farms Moonlight, when the base price was $185,000. You couldn't buy anything close to that size in Chandler for under $250,000. We added some upgrades, and the final price was $207,000. We signed in July '04, and it took a year to build. When we moved in, in July 2005, Fulton's base price for our model had already risen to $279,900. Our neighbor told us he bought the house next to ours, same model, for $305,000. We had almost $100,000 in equity the day we moved in!
Feeling confident in our equity, we took out a 2nd mortgage for $23,000, raising our total debt on the home to $230,000. WAY below the $305,000 it was selling for.
Last summer, my wife and I decided to divorce. We put our house on the market in September, and had realized the market had started to decline. We wanted to be aggressive, so we priced our house at $279,900. Even with our upgrades, we decided to list it for less than Fulton's base price. We wanted buyers to know we meant business, and wanted it sold fast. So we thought...
After no interest at $279,900, we dropped it to $275k, then $270k, and continued to drop it in $5k increments until we hit our break even amount of $253,500. After paying commissions and fees, that would allow us to pay our $230k mortgages and break even.
Now, it's March of this year, and the house has been on the market since last September. I had lost my job with Intel in December, and had just found work again with PetSmart at their headquarters in North Phoenix. No, the drive isn't bad...only 1.5 hours each way. And my ex-wife hasn't paid a dime of the mortgage, that was difficult to pay with both incomes. Now I have to pay it on my income alone.
So I talked with my realtor, and decided to drop the price more. $224,500. This is less than I owe, not to mention commissions and fees. I would have to present the bank with a short sale, once I got an offer. Well, no one was interested at that price either. So recently I dropped it to $214,500. Still nothing. I spoke with a well-known Maricopa realtor this weekend, who told me that the market value for my house is about $175,000 right now. Are you kidding me?! I bought it at a STEAL for $207,000, back in 2004.
The two mortgages come to about $1900/mo, which is too much for me to handle. Not to mention the HOA fees and outrageous water and electric costs. Renting it out till the market comes around isn't an option, as I've been told I might be able to get $1000-$1200/mo for it. However, that's about what I would be paying in rent myself. So my monthly expenses would be the same.
I read that due to the unfavorable location and the blowout builder models and foreclosures, the Maricopa housing market could take 2-4 years to get back. So when I consider the drive to work, the lovely construction on 347, the monthly expenses of the house, the wonderful smell of cow poop, being subject to unscheduled closures of 347 which force me to drive through Casa Grande to get to Phoenix, the water and power outages this weekend....it all got to me. So I signed a lease for an apartment 1 mile from my work, and I'm foreclosing. It sucks and I know the ramifications to my credit, but I feel I have no other option.
I feel so relieved, as if a weight was lifted off of my shoulders. I don't have to drive 58 miles each way to work, in 20 mph traffic. My friends in town will actually visit me now. My rent is $1000, compared to my $2000 mortgage. My water/sewage bill will be $40, instead of $100+. I don't have to pay or deal with the HOA anymore. Ahhh, sweet freedom!
Anyone else facing foreclosure? Share your story. | | | |
| | alanf
Posts:1462
| | 08/13/2007 4:46 PM |
Alert | Dude....I'm sorry for you and happy for you at the same time. I would hope that you bounced off the bottom and are on your way back up. Good Luck.
And thanks for scaring the crap out of me!!! | | |
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| | MommaToni
Posts:1045
| | 08/13/2007 4:47 PM |
Alert | No but you should try a deed in Leui of forclosure..... call you mortgage companies andsee if you can work that out. It's basically not having to go through all that drama and just signing the hous eback over to them.
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Ppppppbbbbbbssssssssssttttttttt! | |
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| | azsouthendzone
Posts:0
| | 08/13/2007 4:50 PM |
Alert | | That is a sad story and you aren't alone. | | | |
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| | Jazz
Posts:0
| | 08/13/2007 5:00 PM |
Alert | | Congrats on your newfound freedom Rob! I suspect a lot of people feel your pain. You paint an even bleaker picture than I envisioned. Thanks for the pick me up! | | | |
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| | DingDong
Posts:252
| | 08/13/2007 5:03 PM |
Alert | Rob,
Sorry to hear of your two losses and your frustrationsm of trying to sell. I'm happy that you now feel relieved. Please try and call your lender and see what you might be able to work out with them. Foreclosure should be your last resort. Good luck in the future. | |
DingDong
Senior Member
Joined: July 2005
" Yeah, definately yeah. " | |
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|  | vinny
Posts:636
| | 08/13/2007 5:29 PM |
Alert | its aweful for you. but you dug your own grave. did you really think the housing market around here would go forever with thousands of new houses being built all over the valley?
to be honest, your rent figure is even a little high. i'm paying $895 for a 2500 sq. ft. house in rancho. and there are cheaper houses than this for rent here. just look on craigslist, and search for maricopa. i've seen as low as $750 a month.
this house was purchased for $278,000. its a 2500 sq. ft ranch, nice place. there was just a listing for a 2 story just down the street that is bigger, nicer and is on a slightly bigger lot. the asking price for the 2 story was $159,000. there are at least 30 other houses for sale on my street. the neiboring house and the house accross the street went through foreclosure.
the guy that owns this place has at least 2 other houses in the area, he has got to have lost nearly $500,000 in the last 2 years. the house he lives in was purchased for $380,000 and is worth far less than that now.
when we first moved tp phx metro EVERYONE was a real estate genious, telling us how stupid we were for "thowing away" our money on rent when we could just buy a brand new house. I paid $500 a month for 3 months and now I pay about $900/mo for the last 17 months. i spent $16,000 in almost 2 years for a roof over my head. i could have bought a house for $250,000 that are now selling new for $130,000. that would have been a much better idea. i only would have lost around $120,000, assuming my adjustable rate mortgage didn't go so high i couldn't afford it.....
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Follow your bliss. Happiness is a conscious decision | |
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| | Ratboy
Posts:0
| | 08/13/2007 5:53 PM |
Alert | | I am almost in the same situation. Been feeling the crunch of the housing market and wondering if it will ever get better. Man I hope. | | | |
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| | Hillarie
Posts:126
| | 08/13/2007 6:26 PM |
Alert | Posted By Ratboy on 08/13/2007 5:53 PM
I am almost in the same situation. Been feeling the crunch of the housing market and wondering if it will ever get better. Man I hope.
Unfortunately, the housing market has a long way to fall before it hits bottom and begins to slowly inch back up. Reports are that many of the sub-prime mortgages (interest only, adjustable rate, etc.) are going to hit their first balloon payment and/or rate increase this fall (October/November) resulting in many more foreclosures, and thus a further glut in the re-sale market - - combined with all of the new home inventory the builders have on hand in the Phoenix metro area (approximately 9,000 homes by some reports). Many people are in the same position as Rob - - they took out additional mortgages based on the paper equity, or WORSE, took out a second loan to make their down payment. Because these people have a high debt load to cover, they are very stubborn on their asking price - - which is keeping the re-sale market inflated. Until the resale market corrects itself, the new home market won't and values will continue to fall. It's very sad - - but when new home prices were rising on a weekly level with waiting lists and lotteries it was inevitable that this would happen. Especially with all of the speculative buyers flowing in from out of state (California) who didn't mind paying higher prices because they were still less than prices where they were coming from.
I really feel for people in this position. It's going to get really ugly. Just in time for the holidays. | |
Karma is a female dog | |
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| | azsouthendzone
Posts:0
| | 08/13/2007 7:29 PM |
Alert | Check out this guy's rant...pretty epic.
http://youtube.com/watch?v=qC3YOFKTsTg&mode=related&search= | | | |
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| | pissedparent
Posts:233
| | 08/13/2007 7:47 PM |
Alert | Posted By Rob on 08/13/2007 4:42 PM
We had almost $100,000 in equity the day we moved in!
Feeling confident in our equity, we took out a 2nd mortgage for $23,000, raising our total debt on the home to $230,000. WAY below the $305,000 it was selling for.
This is where you made your mistake, equity is gradual, not an instant 100 grand. Just because they bought theirs for 305 doesn't mean that is what it will sell for. You should just sell it for what you can get and pay off the debt YOU created. To foreclose or file for bankruptcy is really sad and irresponsible.
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| | azcarcarrier
Posts:295
| | 08/13/2007 8:05 PM |
Alert | Rob sorry to hear about the property situation. Unfortunately upcoming in oct/nov almost 6 million home mortages are going to adjust any where from 3-6 pts.
Is your loan 30/yr fixed. What is the bottom short sale you think from the bank? I know a family moving to Maricopa and will pass your email to them. | | | |
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| | MommaToni
Posts:1045
| | 08/13/2007 8:13 PM |
Alert | You can do a Deed in Leui as I stated above or a short sale. If you do a short sale you get a 10-99 for the difference and it will just be counted as "income" and you will have to pay taxes on it like you woul dyour regular income.
Could be worth it in the long run. Your situation does suck and unfortunately you are not alone. Alot of people cashed in on the equity at the time and now are in real trouble. I wish you the best. | |
Ppppppbbbbbbssssssssssttttttttt! | |
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| | Colgate
Posts:602
| | 08/13/2007 8:20 PM |
Alert | Posted By vinny on 08/13/2007 5:29 PM
its aweful for you. but you dug your own grave. did you really think the housing market around here would go forever with thousands of new houses being built all over the valley?
to be honest, your rent figure is even a little high. i'm paying $895 for a 2500 sq. ft. house in rancho. and there are cheaper houses than this for rent here. just look on craigslist, and search for maricopa. i've seen as low as $750 a month.
this house was purchased for $278,000. its a 2500 sq. ft ranch, nice place. there was just a listing for a 2 story just down the street that is bigger, nicer and is on a slightly bigger lot. the asking price for the 2 story was $159,000. there are at least 30 other houses for sale on my street. the neiboring house and the house accross the street went through foreclosure.
the guy that owns this place has at least 2 other houses in the area, he has got to have lost nearly $500,000 in the last 2 years. the house he lives in was purchased for $380,000 and is worth far less than that now.
when we first moved tp phx metro EVERYONE was a real estate genious, telling us how stupid we were for "thowing away" our money on rent when we could just buy a brand new house. I paid $500 a month for 3 months and now I pay about $900/mo for the last 17 months. i spent $16,000 in almost 2 years for a roof over my head. i could have bought a house for $250,000 that are now selling new for $130,000. that would have been a much better idea. i only would have lost around $120,000, assuming my adjustable rate mortgage didn't go so high i couldn't afford it.....
Well, aren't we being a bit rude! This unfortunate event could have been you! He is acctually doing okay with his rent price considering he is close to the city and Rancho is not!!!! Also, many people lost their a$$ on this crazy market, so show some empathy!
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Live every day as if it were your last and smile! | |
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| | jimbob
Posts:114
| | 08/13/2007 8:25 PM |
Alert | It sounds like you've done what you can and hopefully you can bounce back. The equity loan was probably a bad idea but I'm sure alot of people did that because they thought it was an OK thing. I know people should educate themselves but I personally believe that lenders need to take more responsibility as well.
Don't pay too much attention to the people that rag on you for being irresponsible. I mean nobody likes it when someone gets out of a big loan but sometimes that's your only option. It's not like you were planning on getting divorced and this kind of thing could happen to alot of people.
There are people who drop out of a loan much earlier and don't really stick with it but it seems like you really tried.
Good luck out there!
-j | |
Our website:http://jamesandchanin.com | |
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| | bitterbeard
Posts:207
| | 08/13/2007 9:29 PM |
Alert | Ouch Rob, sad story and yet not uncommon these days.
If you can hold onto your house in Maricopa the return is probably 5 years down the road.
I've even considered buying a rock bottom priced house at this point because they are so cheap; we won't be in crisis mode forver folks, don't forget about the long walk just because you happen to be standing in the mud now... | | | |
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| | Reagan
Posts:699
| | 08/13/2007 9:35 PM |
Alert | Rob. Sorry to hear your story. I truly hope this is the bottom and things will start to look up for you. You are not alone, there are plenty of people in your exact situation. Don't listen to those who said you dug your own grave. There are plenty of people who would have cash out up to 95-100% You tried to be responible, and the circumstances just didn't work to your favor.
I wish you all the best! | |
Welfare's purpose should be to eliminate, as far as possible, the need for its own existence.
Reagan, Los Angeles Times, January 7, 1970 | |
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| | GilaGuy
Posts:789
| | 08/14/2007 4:14 AM |
Alert | Good luck to you, Rob!
I hate reading these stories because I'd rather nobody had this bad stuff happen to them. But I couldn't help but shake my head at vinny's earlier post. I, too, remember the real estate geniuses who were so quick to judge others back at the start of the boom. Those of us who wanted to take the longview and refused to take out exotic loans or pull out invisible home equity were looked upon as complete oddballs. I remember hearing from friends of mine who would say things like "You're leaving money on the table!" because I was too timid to try a fancy, risky loan.
I'm not rich now. But in retrospect, the decisions I made were right for me and I am lucky to have made them. The friends who thought I was weird? Only one of them is still in his house. I feel bad for the other three, but there's really nothing any of us can do. I suppose this is just one more thing I will consider a lesson learned.
And in the meantime...best of luck to all the homeowners out there! I have faith in our economic system, and I'm sure things will get better in time. | | | |
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| | Azgram01
Posts:278
| | 08/14/2007 6:29 AM |
Alert | If what Rob says is acurate about home prices, it is very scary.
There are so many people in this situation, or very near to it. Foreclosures in some areas of the state are up by 200% and more. My husband heard it could take up to 9 years before the housing market is good again.
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| | vinny
Posts:636
| | 08/14/2007 7:48 AM |
Alert |
posted by colgate: "Well, aren't we being a bit rude! This unfortunate event could have been you! He is acctually doing okay with his rent price considering he is close to the city and Rancho is not!!!! Also, many people lost their a$$ on this crazy market, so show some empathy!"
rude? how about the people that loaned them the money in good faith of being repaid?
as i explained, this COULD NOT be me, because i refused to buy in such an inflated market, therefore i didn't take out a loan for more than i can afford, and then immediatly stack another loan on it because the market was even more inflated.
getting caught up in your own irresponsibility doesn't warrent empathy.
have you looked at a map of where rancho el dorado is? my house is less than a 1/8 mile from the north most traffic light in maricopa, doesn't get much closer to the reservation than here. 
EDIT: after a re-read you may mean closer to the center of maricopa when you say city, but there isn't a whole lot of draw there. i would want to pay less if i was farther from phoenix....
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Follow your bliss. Happiness is a conscious decision | |
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