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Perhaps this is the deep recession I have seen in my life (as if I have seen several. I have seen one in 2002-03). I wanted to buy a investment property in down town San jose which was regular and not a short sale.
I went to see the property and was so much depressed to see several properties on sale and not just on sale but more than 50% of these properties was on Short sale. So, why not attempt to buy them? Well, there are several stories of short sales being a futile try and only few of them close (Statistics in Sacramento shows 8-12% close and rest of them would be taken by bank itself or real estate agency taking over or something that we all are not aware of)
Why not look at one of them? I became curious and asked my real estate agent to email me the details of few short sale properties. I liked one near Vine Street, San Jose and went to look at.
This property was
1. triplex, one had the owner himself, his brother in law and the last one empty
2. The price he paid last year 07 june was 775k
3. His profession was just a small time job in a mexican restuarant.
4. He had down 0% and interest only ((payment of $5500 per month)
Now, how could any sane underwriter give a super jumbo loan for someone who might or might not have good credit history and good job for more than a year to pay this kind of mortgage? Did the underwriter check this or did not? What was the prequalification basis that was used to qualify this loan? Etc etc
Then I was told by the RE that there was lots of loan last year that had the same pattern. Did the banks know that they were doing this as the right thing or they were hatching a plan to get funding from government or were they bundling up all the loans to sell it as a big loan?
Just because some fool(s) decided to make these radical irrational decision, and in part contribute to the debacle of US economy, why would I have to go through lots of job losses that is affecting our lives, loan hazards and shjort sales and depressive holiday season?
This is not the America that we lived and not the America that we want to look forward for.
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