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builds character posted:Yeah, don't do that but do be very nice to the appraiser and offer them water and such. Do not volunteer bad facts about the house.
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Feb 28, 2014 01:10
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on my sale I offered the appraiser a bottle of water and a cookie. He accepted neither.
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Feb 28, 2014 01:13
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Leperflesh posted:What is supposed to be done is that the appraiser starts with the accepted bid, because that's strong evidence of the market value, but then also should take comps and evaluate whether the accepted bid is way off from those. In a high-volume market it's easy to see if a given price is an aberration or if it's inline with the comps. In a low-volume market, there's much less evidence for the appraiser to use to determine that the accepted price is wrong, so I think they're more likely to go with the accepted bid as the appraised value. Don't forget the voodoo and reading of tea leaves. To add on to this, looking at it as purely rubber stamping is a rather cynical perspective these days. In 2006, I would agree that rubber stamp was a good way of looking at it. These days, due to regulatory and industry changes, I would say you're much less likely to run into that sort of brazen behavior. In an ideal purchase transaction both you and the seller should have done your homework researching the neighborhood with your realtors and, in theory, the agreed on price will be a figure the appraiser would arrive at themselves as to the value of the property based on what the comps are selling for. Will they round a few grand to match with the contract for convenience? Sure, but unless your appraiser is complete poo poo/crooked they aren't going to say its worth 250k instead of 200k just because that's in the contract. I'm not on the origination side of underwriting anymore, but when I was I saw appraisals everyday well below the contract price because the buyers and sellers did a bad job researching the market. And no, you shouldn't try to get your buddy Benjamin to talk to your appraiser. Again, unless your appraiser is super lovely/crooked it can result in being reported to the appraisal management company/lender which at a minimum will probably result in your loan being denied outright, and depending on the lender may get you put onto the industry blacklists. Captain Windex fucked around with this message at 02:06 on Feb 28, 2014 |
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Feb 28, 2014 01:50
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LemonDrizzle posted:Concealing bad facts about the house or otherwise trying to make it look better than it actually is just so the appraiser will sign off on your mortgage seems like a really dumb thing to do unless you like making potentially very expensive mistakes. I think everyone is talking about it from the seller's perspective, if I am reading it correctly.
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Feb 28, 2014 02:07
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ExtrudeAlongCurve posted:I think everyone is talking about it from the seller's perspective, if I am reading it correctly. The seller should have no interaction whatsoever with the appraiser the buyer uses to satisfy their bank's appraisal requirement, beyond perhaps providing a key if it's FSBO and still owner-occupied. It's better if the seller isn't even present.
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Feb 28, 2014 02:33
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Captain Windex posted:Don't forget the voodoo and reading of tea leaves. It's not as bad as it was but if you ask three different appraisers you'll still get three different answers. 
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Feb 28, 2014 04:17
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resident posted:e: I would buy a condo again under the right circumstances but here are things I would consider *DO NEVER BUY* red flags: This is really fascinating stuff because I had no idea what this was until a few years ago. I bought my condo 7 years ago and started going to the HOA meetings when there was a campaign to oust the board president. Turns out she was a nitwit but held the office for 15 years simply because they could never get a quorum at the annual meeting to hold a vote! So with the campaign a quorum showed up and voted her right out. Turns out she was not malicious but very incompetent. She didn't want to raise dues ever, but was hiring bad contractors so our siding and roofing kept needing to be replaced at an accellerated schedule, and things like that. When the new board president took office, the reserve account for our 180 unit association was five thousand dollars. He has turned the place around, kicked the rear end of all the contractors, haggled our insurance coverage, landscaping, garbage and pavement contracts down in price but with high quality companies, conducted the reserve study and brought our reserve accounts back up to about half of where they need to be. He apologizes for jacking up the monthly dues (they've gone up about $20 each year for the last 4 years) but he's fully transparent about where the money is going and what he's doing to stretch it. Now everyone loves him except for a small core group that are loyal to the old board president for some stupid loving reason, and all they do is bitch about how the dues have gone up, and try to find some insignificant nitpicky reason to accuse him of being unethical. Like accusing him of only obtaining two quotes for new insurance instead of three and stupid poo poo like that. Somehow that makes him unethical, never mind his predecessor basically putting the entire community at risk of huge special assessments by mismanaging our safety net.
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Feb 28, 2014 07:58
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LloydDobler posted:This is really fascinating stuff because I had no idea what this was until a few years ago. I bought my condo 7 years ago and started going to the HOA meetings when there was a campaign to oust the board president. Turns out she was a nitwit but held the office for 15 years simply because they could never get a quorum at the annual meeting to hold a vote! So with the campaign a quorum showed up and voted her right out. Turns out she was not malicious but very incompetent. She didn't want to raise dues ever, but was hiring bad contractors so our siding and roofing kept needing to be replaced at an accellerated schedule, and things like that. Condo.txt Seriously having grown up around condos and co-ops, I've never seen one that wasn't like that. "Oh hey all the furnaces are hosed we need to change them all. We're going to need to increase fees." "All in favor! Woo!" Members don't pay, management doesn't collect in the interest of good neighborhood relationships, coop has five figure account payables backlog. 
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Feb 28, 2014 08:16
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Leperflesh posted:The seller should have no interaction whatsoever with the appraiser the buyer uses to satisfy their bank's appraisal requirement, beyond perhaps providing a key if it's FSBO and still owner-occupied. It's better if the seller isn't even present. Wait but the buyer is allowed to be around? When we bought, neither seller nor buyer was around. The listing agent just let the appraiser in, he did his thing, and we got a report. I guess that's why I'm confused about this theoretical "bribing the appraiser" (which is a dumb idea) talk 'cause I'm not even sure where in the process that would even be possible. EDIT: I googled it and it sounds like BOTH seller and buyer can choose to be around but since it's literally a short hand-waving done by the lender, why would anyone bother. It's a bad appraiser that would engage with either party; theoretically he should just ignore anyone who is there. ExtrudeAlongCurve fucked around with this message at 16:36 on Feb 28, 2014 |
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Feb 28, 2014 16:31
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ExtrudeAlongCurve posted:Wait but the buyer is allowed to be around? I was there when I bought my house. It was great because the appraiser explained his findings to me in plain English and let me ask questions. Even though my dad was a home builder none of that stuff rubbed off on me. It helped me feel good about the home purchase.
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Feb 28, 2014 19:18
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Dumb Question: For someone that hasn't negotiated a short sale with their bank what happens when (if) they sell their house for less than the amount owed on the property? Does the bank typically just turn that into a debt or is the homeowner expected to pay additional principal before closing to balance things out? Sephiroth_IRA fucked around with this message at 20:17 on Feb 28, 2014 |
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Feb 28, 2014 19:24
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Orange_Lazarus posted:Dumb Question: For someone that hasn't negotiated a short sale with their bank what happens when (if) they sell their house for less than the amount owed on the property?
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Feb 28, 2014 22:43
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FrozenVent posted:Condo.txt There do exist some HOAs that are perfectly solvent and run by decent managers, but they are a small minority in the US at present, especially among the communities that had anything to do with the last housing boom. The condo I bought in '07 for $320k that sold for $170k in '10 is still only about $170k now it turns out and the dues have gone up from $340 / mo to $390 even after the resolution of the massive lawsuit that got the HOA only some of the money spent on lawyers. The case precedent against Equity Residential in Chicago Q1 2010 affected dozens and dozens of HOAs around the US with a lot more that didn't survive the legal costs to take it to the court. Almost none of these condos will appreciate to even match inflation because monthly cost increases will suppress natural market appreciation. Most of the residences in the area appreciated about 30% at least in the same time period, for comparison. Maybe in another 10 years or so will these condos be possibly worth buying and expecting to match even normal SFH real estate price curves, and by then we'll probably have another recession or two. Orange_Lazarus posted:Dumb Question: For someone that hasn't negotiated a short sale with their bank what happens when (if) they sell their house for less than the amount owed on the property? All of that depends upon the jurisdiction and/or HOA allowing transfer of the title to the new owner. Some HOAs will withhold the certificate / place a lien to sell a property for things such as unpaid dues and is the nuclear option besides a lawsuit that they have against a resident. Given that at least 75% of HOAs have a lawsuit going, there's an ICBM in flight at all times in the land of HOAs. Depending upon the state, the lender will either file a 1099-C that's cancellation of debt, which means that the seller will owe the difference in taxes because the 1099-C (like every other 1099) is treated as regular income. In a recourse state, the bank will likely file a court action / lawsuit for the difference (probably a warrant in debt). Short sales are most popular in non-recourse states for this reason while outright bankruptcies are more popular in recourse states to get out of a potentially massive 1099C (not to mention usually a foreclosure / short sale is preceded by a financial catastrophe). Lenders in recourse states can probably both collect on PMI payout as well as any proceed from suing the former owner.
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Feb 28, 2014 23:28
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ExtrudeAlongCurve posted:Wait but the buyer is allowed to be around? Yeah for the bank's appraisal, nobody needs to be there really, but I don't think there's a law against it from either angle. It's just not a good idea for the person intimately familiar with every flaw of the house to be there, either trying to cover things up, or trying to expose them, depending on whether they'd gain financially by having the appraisal succeed or fail.
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Mar 1, 2014 00:42
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Orange_Lazarus posted:Dumb Question: For someone that hasn't negotiated a short sale with their bank what happens when (if) they sell their house for less than the amount owed on the property? The settlement agent/closing attorney won't allow the transaction to close without the lienholder(s) being paid off, if the proceeds won't cover the payoff then the seller would need to pony up the difference or get the bank to agree to a short sale.
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Mar 1, 2014 02:17
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In Seattle it's not uncommon to see HOA fees as high as 4-500 a month for some condos, which blows my mind. Completely put me off getting one.
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Mar 1, 2014 08:13
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Falcon2001 posted:In Seattle it's not uncommon to see HOA fees as high as 4-500 a month for some condos, which blows my mind. Completely put me off getting one. On the other hand if you get a place with cheap condo fees, you're just gambling that the gigantic oh-gently caress-me special assessment happens after you've sold the place.
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Mar 1, 2014 15:22
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My old place was the worst scenario - high dues, few amenities, special assessments anyway, and most owners didn't live in the country so little progress was made. It was worse in overall quality of life than just renting an apartment because there's no way to evict owners from their own property. If you're going to get a condo, I'd go with a high rise with tons of concrete between floors and hopefully between each unit.
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Mar 2, 2014 15:52
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I've rented units in condos for the past few years so I've somewhat had the experience of condo living but without being on the hook for dues and assessments. All the condos I've lived in have had rental caps of around 10% so they've been mostly owner-occupied. The previous condo I lived in was a fully steel & concrete 7-story + 3-level basement/garage that seemed pretty well built and well managed, but it was only built in 2006ish so it hasn't had time to get hosed up yet. Conversely, the condo I'm renting in now is a bit older, built around 1991, and is only concrete for the basement/garage and first floor, with the next 5 floors being primarily wood. This building has all sorts of problems. Multiple instances of water damage, big special assessment levied for new siding right before I moved in, noise travels so much more than the concrete building both in the walls and in the floors, and I'm sure plenty more that I don't even know about. I'm really glad I don't own a unit here. My landlord is a real estate agent and I've talked with him at decent length about buying a house/condo and the local market and even he said that he wouldn't recommend buying 90% of condos out there, the only exceptions being fully steel & concrete buildings with a record of good financial management and maintenance. And even then there's a lot that can go wrong that is mostly out of your control as an individual owner. All that, plus this thread and other reading and research has really turned me off the idea of buying a condo. Guinness fucked around with this message at 16:11 on Mar 2, 2014 |
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Mar 2, 2014 16:08
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Yeah. The downside is that the traffic in Seattle (and many other major cities) is pretty awful and the mass transit isn't up to snuff either, so you end up in an awful catch-22 that my fiancee and I are analyzing now - either you end up with a hour+ commute each way or you end up in a lovely condo if you want to own your own place.
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Mar 2, 2014 18:14
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necrobobsledder posted:If you're going to get a condo, I'd go with a high rise with tons of concrete between floors and hopefully between each unit. Still won't save you from insanity. In 2011-2013 I rented a lovely condo in downtown Seattle. Built in 2007, 5% rental cap, gorgeous modern architecture (walls of glass, high ceilings, mix of brick/concrete/steel, LEED certified), thirteen stories, three levels of underground parking, party walls between all units, concierge who learned everyone's names, etc. As renter it was a great deal. But the owners had no end of getting screwed over: - The recession meant everyone who bought in 2007 couldn't sell their condos without taking a loss, but the rental cap meant they couldn't rent out their units either. - In 2012, someone on the 8th floor had a bathtub overflow all night. The flooding resulted in twenty units across five floors needing close to $10 million in repairs. HOA dues doubled for everyone because of this (and they started at a minimum of $250/mo prior). - During the repairs, the board was told the building wasn't built to code for some fire safety stuff. The HOA sued the builder who counter-sued the HOA and for the next year, no one could sell their unit because no bank would provide a loan on a property under litigation. - Shortly after, someone's flower pot fell off a deck, smashing some glass below. The glass was replaced by the building's insurance policy which raised HOA dues for the whole building. - Three months after that was wrapped up, the building envelope was inspected. The builder said it was fine, the insurance company's consultant said it was fine, but the HOA's consultant said it wasn't. The HOA paid several million dollars to fix it (was it actually faulty? I have no clue) then sued the builder for the cost. The builder again counter sued and for the six months of litigation that followed, no one could sell their unit again. I wanted to believe that was an exceptional case, but after shopping for a condo downtown for a year I gave up and settled for a house. It has its own mix of problems, but a guaranteed financial disaster is not one of them!
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Mar 2, 2014 18:22
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You know, at one point I would've considering buying a condo some time for fun or to rent out. But you all have pretty much convinced me that condos should all be burned with fire.
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Mar 2, 2014 18:27
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slap me silly posted:You know, at one point I would've considering buying a condo some time for fun or to rent out. But you all have pretty much convinced me that condos should all be burned with fire. Yeah, you know, I'd been leery of condos but when I started looking for a place to buy about 8 years ago, condo mania was in full swing. Condos were a "can't miss" investment since you could always rent them out, right? There were even office space condo deals out there (which never made any sense to me, if the space was such a sure fire money maker, why would the developer be trying to sell it off?) It seems like everyone completely forgot about all the things that could go wrong like rental caps, giant HOA assessments, fees that rise every year, etc. The housing bubble was insane. (I bought a house  at pretty much the peak  but it's worked out ok 'cause I got a good location)
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Mar 2, 2014 18:51
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Tora! Tora! Tora! posted:(I bought a house
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Mar 2, 2014 18:53
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To counter all the negative condo talk, my anecdote: we found a very nice condo in Chicago that met all our requirements at an okay price in a good location, with a friendly, knowledgeable board that promptly addresses problems while keeping dues at reasonable levels. It's smaller, 16 units, and sound can be a problem wince it's ancient construction, but since everyone here is over 30 no one is throwing keggers every weekend or anything. So worthwhile condos/associations do exist, but it can be very hard to tell the difference from the outside. I'd definitely advise asking for association meeting notes and financials and even talking to the board president if they'll agree before buying one.
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Mar 2, 2014 20:04
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Rooster Brooster posted:I'd definitely advise asking for association meeting notes and financials and even talking to the board president if they'll agree before buying one. I'm working on buying a condo outside seattle now and the resale certificate is a mandatory part of the mortgage process. It's got all the meeting minutes for the last two years, all the financial info for the last 5 years, all the litigation for the past few years, etc. I've also got a pack of title paperwork that has everything going back to when the developer first filed for the permits. They've got a weird HOA inside of an HOA thing going on. The HOA I'm a member of is responsible for 110 units, and they pay dues to a larger HOA covering 2000+ units. I get a vote in my HOA, and we elect a representative to vote in the larger HOA.
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Mar 2, 2014 20:51
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I guess I don't understand why anybody would buy a condo instead of just renting an apartment.
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Mar 2, 2014 22:30
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Cranbe posted:I guess I don't understand why anybody would buy a condo instead of just renting an apartment. Renting is just throwing money away, man.
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Mar 2, 2014 22:36
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Cranbe posted:I guess I don't understand why anybody would buy a condo instead of just renting an apartment. As long as I stay there more than two years, and there isn't a major housing market collapse, and they don't find mold or something in the walls and charge a huge special assessment, It'll be cheaper. And I can paint the walls however I like.
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Mar 2, 2014 23:03
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Cranbe posted:I guess I don't understand why anybody would buy a condo instead of just renting an apartment. Given some reasonable assumptions about maintenance costs, appreciation, holding period, etc., buying can make better financial sense than renting.
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Mar 2, 2014 23:43
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I always find the painting the walls thing hilarious because if you love painting so goddamn much most apartments I've been in don't care as long as you paint it something like white or light grey when you move out. Anyway I live in a condo complex and so far there's been major roof work on my unit--which they found out when the roof on our porch collapsed from rot/water leakage, triggering basically an overhaul of the building's entire roof--as well as a management guerilla campaign waged by the owners where a highly motivated cell started slipping fliers under our doors for secret meetings to overthrow the existing HOA. This is the third time it's happened, by the way. It's like living in one of those third-world countries where the party "ruling" changes in coups every three months. They also spent a year working on the water line with outages every 2 weeks or so and still haven't fixed whatever it was. There have been assessments to pay for all that, which may be the reason for the anti-HOA coups every few months. I just rent here but man, renting here for a year has been more than enough to convince me do never buy a condo.
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Mar 3, 2014 01:36
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My distaste for condos isn't really just condos, so much as it is a hatred of HOA's. I can't imagine putting such a huge portion of my wealth into an asset that is then subject to the whims of a small group of my neighbors. I'm aware there are good HOA's, but they're all susceptible to being taken over by somebody who just needs a hobby; and making sure that you paint your fence a certain color is the perfect way for them to spend their time (e: and your money). (...Or making sure that you plant the right type of grass; or that you pull your trash can back in within 6 hours of garbage truck; or, or, or...)
Cranbe fucked around with this message at 02:07 on Mar 3, 2014 |
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Mar 3, 2014 01:55
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It surprises me that Illinois is the only (afaik) state where the condo/HOA can evict for non-payment of fees.
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Mar 3, 2014 02:04
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mastershakeman posted:It surprises me that Illinois is the only (afaik) state where the condo/HOA can evict for non-payment of fees. Many states allow the HOA to foreclose on you for non payment of HOA fees.
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Mar 3, 2014 02:29
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Bloody Queef posted:Many states allow the HOA to foreclose on you for non payment of HOA fees. How does that work? In IL they evict you, rent out the place to another tenant for up to 13 months, then you can come back if the back fees were paid off, and the owner gets the leftover money. In other states, you lose the place forever?
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Mar 3, 2014 03:17
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mastershakeman posted:How does that work? In IL they evict you, rent out the place to another tenant for up to 13 months, then you can come back if the back fees were paid off, and the owner gets the leftover money. In other states, you lose the place forever? It is a similar process to a mortgage holder foreclosing on the house. They file a claim, if it's validated by a judge and all that other legal bullshit they can force your house to be sold in a foreclosure auction, take the fees they were owed plus all kinds of lawyers fees, etc. And whatever pittance is left (it will be less than 0) goes to you! Yay! Just search Google for HOA foreclosures, there's poo poo like this that comes up: http://news.msn.com/in-depth/dollar288-in-unpaid-fees-homeowner-association-took-her-home It's scary stuff, and while those are the extreme cases, I would never buy a home in a place where they told me what color I can paint my house or what type of grass I can plant in my front yard. HOAs can be absolutely terrible. On the other hand, they can be just a bunch of neighbors pooling resources so the trash gets picked up and the snow gets plowed. It's really situational.
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Mar 3, 2014 03:27
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I bought a house in North Seattle in 2009 and all of you guys make me super duper happy that I scoffed so hard at giant HOA fees for Condos.
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Mar 3, 2014 03:40
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So if a HOA is capable of forcing a sheriff sale (a big if) are they willing to bid the mortgage owed plus their fees? It seems they would lose money going down this road. Keep your condo underwater with equity loans and never pay your fees.
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Mar 3, 2014 16:19
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Is there some fundamental difference between a condo and a townhouse? I'll be moving to a town-house next month and while our HOA fees will go up quite a bit from where we are now ($360 a year to $1500) we're still going to be saving a ton of money (50% inc hoa fees) because the purchase price was so low and because the property taxes and insurance will be significantly (smaller home + we'll be out of the city limits) lower. So right now it all seems worth it at least for the next 1-7 years. I really don't see how I could end up worse off financially. It's even in a really nice area with better schools if my wife and I have a kid. edit: I'm also looking forward to not having to cut grass and putting up with the lawn snobs I currently have to deal with. Sephiroth_IRA fucked around with this message at 16:49 on Mar 3, 2014 |
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Mar 3, 2014 16:42
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Orange_Lazarus posted:Is there some fundamental difference between a condo and a townhouse? Townhouse is basically a design style, while condo is a legal designation that can also describe the style of the property. When most people talk about condos they typically mean high rise type buildings with dozens or hundreds of units, but in reality anything from a 500 unit 30 story building to 2 single family residences joined by an HOA can be legally classified as condos. They may call it a townhouse in the listing to describe the property, but legally it's probably either a condo or PUD. Captain Windex fucked around with this message at 17:21 on Mar 3, 2014 |
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Mar 3, 2014 17:06
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