Contra Costa, California Real Estate

 

In a normal real estate transaction, buyers are provided with disclosures from the sellers. These disclosures are usually in the form of questions which allow a seller to disclose any and all of the problems they know about which would affect the home. If part of the purchase contract, the seller is obligated to truthfully tell the buyer all defects/negative conditions associated with the property.

This could include:

Plumbing Leaks
Deferred Maintenance
HOA Rules
Neighborhood Noise

The list can be quite extensive...and in California includes an area to discuss "material facts or defects not otherwise disclosed to the buyer." It's very clear that the intent is to give the buyer all information they need to make an informed decision....and if the sellers withhold information they have, they can be held liable for damages. But this does not apply to bank-owned properties (REO).

In California, foreclosed properties are exempt from making these disclosures for the simple reason that the bank has never lived in the home and as such should have no knowledge of defects and/or past problems. Up to a point.

I have a client who purchased a REO a year ago and did not get any disclosures. We performed a home inspection and did our due diligence. He moved in and all seemed well. Then the back slope started to move. As they started to work on fixing the problem (the retaining wall was incorrectly built) they happened to contact a geological engineer who had given an estimate to the BANK prior to the sale. What?

Yes....this property had been in escrow before, and the buyer had backed out when they found that the hill was unstable (there were no visible signs of this, but the previous buyer had a personal reference which alerted him to this potential).

The bank did not disclose this.
The listing agent did not disclose this.

My buyer sued both....claiming that although they were not obligated to provide normal seller disclosures and property questionnaires, if they discover a defect, they are liable to disclose this information. Clearly both the lender and the listing agent were aware that the slope was moving, and the cost to repair. The judge agreed and between actual damages and punitive damages.....well, let's just say he paid off his second mortgage and had a very nice holiday. :).

The basic rule of real estate is still intact.....Disclose, Disclose, Disclose!

 

Karen Fiddler
Broker/Associate
The Fiddler Realty Team/eVantage Real Estate
Lic # 01494165

www.searchfororangecounty.com

Serving all of Orange County, California Real Estate!
Buyer's Agents, Listing Agents, Short Sales, REOs, Equity Sales, Investors

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Most of us have seen cracks in our homes. Some of us may have even seen cracks appearing on the foundation of the home. But do you know how to tell if a crack is structurally deficient?

There are many variations of cracks, but there are three primary cracks that are commonly found--vertical cracks, horizontal cracks and diagonal crack. The following overview of the basic types of cracks should provide you with the information you need to help determine if the cracking you see is structurally related.

Pictured from top left: Horizontal crack, Vertical crack, Diagonal cracks, and Stair-step cracks.

Vertical Cracks
Vertical cracking is not structurally related or deficient unless there is lateral movement, displacement, bowing, or if the crack is uneven from top to bottom. If the plane of the wall is the same on both sides of the crack, then it is a contraction crack, and not a structural issue.

Below is a picture of a hairline/very thin vertical crack. It is most likely initial settlement – not a something to worry about, but an example of something to keep an eye on.

Since everything expands and contracts, it is common in commercial work to provide control joints in areas where expansion and contraction is expected. However, control joints are not typically installed in residential construction. Ridged materials, such as poured-in-place concrete, tend to crack from expansion and contraction much easier than more flexible materials.

Horizontal Cracks
Horizontal cracking in block construction is usually structurally related because the bond between the block is broken. However, this does not mean that the wall will collapse. The amount of movement and the cause of movement are important issues to consider. Frost, backfilling, or a significant unbalanced load may cause cracking.

   

Here are some examples of horizontal cracking. In the above pictures we see horizontal cracking with stabilizers, horizontal cracking without stabilizers and horizontal cracking going into a corner.

A frost line crack is not likely to have serious repercussions unless conditions, such as negative grading, are not corrected. Cracking due to poor backfilling practices, or heavy equipment close to the walls, is usually a one-time occurrence. Movement caused by an excessive unbalanced load presents the most serious situation. A significant unbalanced load may be destined for collapse.

Diagonal Cracks
Diagonal cracking is almost always structurally related. Diagonal cracking is defined as a crack that tears through the material, not a step crack that follows the mortar joints. If you are looking at a foundation wall with diagonal cracking, you should be concerned, however, determining the source is fairly easy.

To determine the source or cause of a diagonal crack, draw an imaginary line perpendicular to the center of the crack, downward towards the ground. There you should find the source of the cracking.

Being able to determine the cause or source of a crack can serve as a guide to the action or solution needed. If a design solution may be required, a structural engineer should be consulted.

                                                Safety Steps for Women Realtors - Don't Make Yourself a Target!

I have not been in the Rain for a while.  After being gone for a while I have to tell you,  what I really want to do is write about how my daughter just took the honors of top student web designer in the nation.  But I felt this was more important.  Oddly enough, there have been many times I started writing this but it just seemed there was always something else more important.  Then it became to close for comfort . . .  .

Whether we want to admit it or not, women are sometimes at a serious disadvantage.  It has nothing to do with knowledge about the intricacies of real estate.  It has nothing to do with the fact that we have to take time off to have babies.  Women, I believe, are pretty much equals with men in real estate with one huge exception.  It was the way God created us, but we are smaller and for the most part will never have the power that a man has.  Unfortunately, there are men out there in the world who will exploit that weakness to their advantage.  I let my guard down last week but ,by the Grace of God, a mistake kept me safe when I believe it could have been horrible.  This is my story.

I have been really busy and I took a call and made an appointment to show one of my listings and continued on with what I was doing without missing a beat.  But I should have slowed down to think about what I was doing.  I AM smarter than this and I have always been really careful, but it didn't even sink in that it was a man by himself.  It didn't even dawn on me to be worried about--it is Hudsonville/Jenison for crying out loud.  Paul Harvey has even reported our area to have the highest number of churches per capita than any other area in the nation.  I am still usually much safer but I was on warp speed mode.

The next day rolled around and I was suppose to meet him at noon.  As I went to walk out the door, I told my son if he wanted a ride to work then he better hurry up and come with me and I would drop him on the way.  We were halfway to his work when I realized I had done it again, thought he had to be at work at noon when he is actually suppose to be there at 1 pm--he missed it to.  So I told him to come with me on my appointment which wasn't that far away.  Now normally he would be driving as he needs drive time, but this time he was sitting in the passenger seat.

We got there at about 5 minutes before noon and pulled into the parking spot in front of the house which was parellel to the road but kind of at an angel. . .  .and we waited . . .and waited . . and waited.  At around 12:15 a guy went by the house slowly and was really rubber necking it--leaning across the seat and looking really hard at the house--or so I thought!  Truthfully, I just thought wow he is really interested in this house.  The house sits about 200 feet off the road so with the angel and everything, he didn't see me watching him.  He could only see my son.  I didn't really think that much about it.  We waited until 12:30 and left--I haven't had a no show in years.  Still oblivious to what had just happened.

When I got back to my desk I called the seller to apologize that she and her family had to leave for no reason.  She asked me when I had taken the call to show the property and I said, "I don't know, sometime yesterday am".  She said there was a vehicle that was stopped in the front of the house talking on the phone at right around 10.  I said, "oh, what color was the truck".  There was  a long pause and she said, "Tami I didn't tell you it was a truck".  Serious chills ran down my spine.  "Oh dear Lord ," I said, "please don't tell me it was a red truck".  She confirmed that it was.  I felt sick to my stomach.  "Did it have a red matching topper?"  Long silence . . . ."yeah it did". 

I hung up the phone and with dread, pulled up the phone number he had given me and called it and listened to the computer voice tell me how this phone was no longer in service.  Dear God in Heaven . . .he had driven by and seen a man with me and had kept going . . . .he had planned on me being alone.  I knew it and my seller knew it.  I called the police and told them what happened and they asked me if I had taken the plate number.  I hadn't because it hadn't dawned on me what was going on until long after I had left.

I let my guard down and I shouldn't have.  Let's face it, most Realtors can't afford to give up a client and that includes women.  But, I have had a plan that I have adhered to for years. . . and I slipped.  I would not have been prepared if I had been in a bad position.  My first plan is to have someone come with me.  When I can't find someone, I have a plan in place that is pretty thorough and I would like to share it with you.

#1.  Find out what you can about him before you meet him.  Where does he work, where is he staying.  Call and verify that what he tells you is true.  Believe me, when you call businesses and explain you are a women and wanted to verify who this man is, they commend you for not being  . . .well . . . .stupid.  Even better, ask who he is pre-qualified with and get their phone and information and call and verify that he is working with them.  I know many of you will say they should be pre-qualified before you even meet them.  On this I disagree,  but I don't want to debate that right now with this post.  I have called several companies when people say they just moved here for a new job--not once have I had anyone refuse to let me know that he did work there or he did have an appointment.

#2.  Before the appointment, call him and ask him for his drivers license number, plate number and the make, model and year of his car.  I have only had it one time that they refused and I had a creepy feeling anyway about him.  Most men are impressed that I am on my toes and thinking.  Tell him you will verify it when you meet.

#3.  Plan ahead and have someone who is keeping track of where you are and what homes you are showing and the addresses of all of them.

#4.  Do not ever meet your male clients in a secluded place.  If you don't know that exact area, pull it up on Google maps and look at the aerial picture.  It will tell you a lot about if the home is secluded or in a subdivision.  If it is in a secluded area, meet them in a busy parking lot first.

#5.  Carry pepper spray.  Keep it in a pocket but don't put it on key chain so they see it--it takes away the surprise advantage.  You can buy it anywhere on line.

#6.  Keep your keys in your hand.  Hold one key through your fingers so if you punched, it would stab.  You should also make sure you have a panic button for your car that will make the alarm go off by pushing a button.

#7.  Have a secret text you can use with your point person to let them know if you are in trouble and a different text if you are ok.  My text that someone sends me 15 minutes after I am suppose to meet him is, "what did you do with the key".  If I text back, "I left it under the flower pot" they know I am ok.  If I don't text back within five minutes, they call the police.  If I know I am in trouble, I text back, "it is under the garbage can".  From there I have to text every 15 minutes.  The next text that my point person sends is, "the key isn't there".  If I am ok then I text back, "check both flower pots".  You get the idea.

#8.  When you arrive at the appointment.  Verify his info, then take his picture and a picture of the vehicle and text it to your point person.  They should be waiting for this.  If they don't get your  info, they immediately send the secret text.  If you don't respond or respond the wrong way, they immediately call the police.

Is this fool proof?  I am sure it isn't-- nothing really is.  But, this sure puts us in a better position!

Pass this around, print it, reblog it, copy it in any way you want.  You never know what women you might save!

THIS IS AN ADDITION AS I THOUGHT IT WAS GOOD INFORMATION

Dawn Maloney had some good advice:

Check out their name on www.pipl.com, google.com or 123people.com - she actually kept herself from showing a serial rapist a home by doing this.  Thank you Dawn!!

Brian Block said:

I'd highly suggest to you, and all women (and men) to read the book "The Gift of Fear" by Gavin de Becker. I can't recommend it enough. This book will change your perspective on the world and make you more aware of your surroundings and how you can prevent dangerous situations.

What was your first reaction when seeing this property?

Assuming that you’ve been there in person before writing an offer, the initial price must have been within your reasonable range, or you would have skipped it altogether. Was there something objectionable about the property supporting a lower price?

Is the home price overpriced or in step with the current market?

How does the price per square foot compare with others of equal size, location and condition? Is there a surplus of properties, or are inventory levels below average?

What kind of seller is in the equation?

If this is a foreclosed property it is likely priced below market value. The bank’s strategy is to get it off their books, and fast. Most times the house has been vacant for a substantial period of time and its condition can be less than ideal. If it’s seller owned, but a short sale, the listing agent may have priced it far below market to attract a quick sale to stave off foreclosure. That doesn’t mean that this low list price will actually be accepted by the short-selling bank. It’s simply a starting place to entice offers. If the home is an equity sale it may not be a distressed sale.

Are there many distressed properties comparable to this one?

One foreclosed property or short sale does not set a new price level for an entire neighborhood, although it may have altered buyer’s perceptions of such. If there are other regular sales in the vicinity, or a low percentage of distressed properties in the surrounding areas, that will carry more weight.

Consider the appraisal.

Let’s just say that you make a grossly below-asking-price offer and the seller accepts it. If the appraisal comes in higher, how likely is it that the deal will go through? If you’ve made a low offer that is supported by the appraisal, then you’re likely to have more bargaining power when returning to the seller for a price adjustment.

Is some recent home buying/selling experience influence your judgment?

If you recently sold a home and got beat up on price, you may feel justified in doing the same. If it was recently and in the same market, it may make perfect sense. But if this was a year or two ago, or in a completely different location, you may not be comparing apples to apples.

Do you love the house, and really hope you can buy it?

If your offer is deemed ridiculous, you take the chance of setting the tone with the seller, be it bank or otherwise, that you are not a serious buyer about this property, but just looking for a deal.

If your home was on the market and you received this offer, what would be your first impression?

Would you be angry, disappointed, insulted? Those are very often a seller’s first reactions. I’ve heard more than one state – I’d rather take it off the market than sell to these people. Perhaps you think it’s worth giving it a try and it very well may be. But…..

What do you imagine the seller’s response will be?

Accept it, counter it, or reject it outright? You may be expecting the seller to counter you, no matter how low the offer starts.  However, it’s always good to play the what if scenarios, and determine what your reactions to each possible outcome would be.

How will you feel if you don’t get it?

Is this the house you want the most of all you’ve seen? How long do you expect to live there? It’s a good exercise to run numbers through your mind. “If I get it for $10,000 less, I’ll love it even more!” “If I paid $20,000 more over the next 5 years that I live here, would I be ok with that?” Just some food for thought…….