As many of your know, I sell many bank owned properties and have heard many stories that ended in a foreclosure.  I have heard all types of sob stories about how someone never thought it would happen or doesn’t know how to deal with it once it has happened.

However recently it pains me to see this happening to someone I know.  I have always seen the conclusion and for the first time I am seeing the steps that lead to it as they progress – and it seems like nothing I can say or do will prevent the ultimate conclusion.

My friend, it is sad to say, does not manage money well.  She spends a lot on things that are not necessary and refuses to cancel a number of unnecessary monthly expenses.  She earns less than what she is saving but refuses to do the math that points this out.

Because of this, she is having a difficult time making payments on two properties she owns.  One of these is her primary residence, while another is a property she received from a relative.  The relative had no need for it any longer so she quit claimed it to my friend.  The problem is the property is underwater – she owes more than it is worth.

My friend’s dream is to one day sell both properties and buy a larger primary residence.  The problem is the second property is already underwater – while the primary property is worth about the same as their loan amount.  Given current price trends, this is unlikely to happen.

The second property remains unoccupied and I have strongly recommended for her to put renters in.  Both she and the relative who initially owned it are strongly against this – mainly because they fear renters will destroy it.  I have tried showing them that math that renters will help them recover at least some of the monthly payment – but they prefer for it to remain empty for the foreseeable future.

I also offered the possibility of a short sale – but they wanted to hear none of that.  The sad thing is – in their stress to keep both properties – they have fallen behind in payments for both.

While I doubt they will lose their primary residence it does look very likely they will lose the second property to foreclosure.  This would be a huge shame because if they just put renters in they would probably be able to afford to keep it – and even if they cannot afford to keep it a short sale would hurt their credit far less.

Of course the biggest problem is she refuses to believe that a problem exists.  Her finances are fine, according to her, but then she asks me questions about how long banks will wait before foreclosing on a property and from other family members I have heard that payments are in arrears.

All of this is very sad.  The vast majority of properties I seen foreclosed were very preventable.  The problem most often is the failure to admit to oneself that there truly is a problem and there is a solution to every problem.

Typically I do not promote particular products, but recently I have come across two exceptions to the rule.

Preorder Microsoft Kinect

Recently my two sons had the opportunity to test the upcoming Microsoft Kinect.  We already have the Wii, Wii Fit, Xbox 360, and two Nintendo DS’s, so they are well aware of video games.

This will be the next big thing.  It totally blows the Wii away and the games are fun for all ages – not true for the majority of current XBox games.  This is an absolute blast and if you hope to be able to find it in stores come the holidays think again.  It will be close to impossible to find.  Your kids (and spouse) will want one of these.  It is extremely cool and fun and everyone will be going to the store to buy one – but the stores will be sold out.

So do yourself a favor and preorder it on Amazon.com or a number of other places that accept preorders.  In the past I have preordered highly anticipated items (such as the Wii Fit) on there and we spent our time playing while our relatives and friends looked on with envy as they scoured the stores hoping in vain to find one.

So safe yourself the agony and stress and preorder one of these so you are not left out in the cold for the next revolution in gaming.

Create a vacation book using Blurb

Approximately a month ago, we took a trip to China and Hong Kong.  My husband loves to photograph and took 2700 pictures of the vacation.  When our friends and relatives wanted to see the pictures, they rarely got that far.  Even in the past – when we had fewer pictures of individual trips – it was difficult showing trips on the computer.

So this year we took the top photos and created a 120 page photo book using Blurb.  You can go to www.blurb.com to see for yourself.  The process is very easy using software that you install on your machine and anyone can do it.

Now when people come over and ask how our trip was, we just hand them the book.  The pictures are arranged to tell stories as well – providing much more emotion than if they were simply viewed on the computer.  This also has made it easy for me to show our trip to my coworkers – as it is much easier to tell someone to look through a book than navigate to a web site.

I am sure we have all had days when there are ten million things to do and only a few hours to get them done.  You find yourself stressing about all these things that you have to do and subconsciously repeat them in your head so you do not forget them.

The problem with doing this is you are wasting valuable brain storage and thought process with remembering all of these things.  What I find very useful is to write everything I need to do down somewhere.  Typically this is a piece of paper or a white board – somewhere very accessible.

I then forget everything that I need to do and just remember where the piece of paper is.  Now that I have cleared my mind, I read the items on the paper and choose one to do.  Typically I choose the ones I can accomplish the quickest – so I can have the self satisfaction of removing as many things off the list as I can.  Of course, sometimes there is one item that is most urgent – so I do that one first.

Once I complete an item, I cross it off the list and forget about it.  If a new item arises, I add it to the list.  I only think about one item at a time – the one I am currently working on.  When I have finished that item and crossed it off, I peruse the list to find the next thing to work on.

I find in this way I do not stress about what needs to be done.  I only need concern myself with completing the task on hand and find myself free to think about it clearly.  Sometimes I even handle my phone calls this way.  While I am working on something important, I will ignore all calls – adding a new item to my list called “listen to messages” and then proceed to finish the task at hand.

I know all of us have had those days when you are incredibly stressed out.  Everyone you depend on has let you down, everything is due, no one has any patience, and everything collapses at once.

Your blood begins to boil and you start lashing out at your tormentors.  You become enraged, frustrated, tense, and more of the above.

You would like some sympathy.  You would like someone to jump in and bail you out and tell you that you did your best and handled it better than anyone else could.  The truth, though, is far from it.

It is all your fault.

Yup.  It is entirely your fault that you are so stressed out.  You did this to yourself, and now you are suffering the consequences.  Every bit of that stress was entirely avoidable, but you chose to not avoid it but instead plunged head first in.

Stress is merely a reaction to things happening around you.  In some cases, these things are entirely preventable.  You could have organized things better.  You could have handled the issue that you knew had the potential to blow up but chose not to.

Think about the things that are stressing you out at the particular time.  Is there something you could have done to avoid them?  Chances are there were.  You could have reviewed your work more thoroughly before sending it out.  You could have made sure a colleague knew exactly what he needed to do before depending on him for the result.  You could have made sure he was dependable in the first place.  You could have had a backup plan in case something failed – which you suspected it may.

Even when an event is unpredictable, the stress is still your fault.

Say for instance, you are minding your own business one day when you receive several phone calls. 

- The first phone call informs you that you are being sued by a buyer because a plane crashed on his house and you had told him the roof was strong – so the damage must be your fault. 

- The second call informs you that your grandmother has died and that the entire family is expecting you in Nome Alaska tomorrow to deliver the eulogy.

- The third call informs you that a dam broke near your home and all of your possessions have been washed away.

- The fourth call is from your doctor and informs you that you have cancer.

- As you finish the fourth call, the goes out in your building and your computer (which you had never backed up) catches fire.

These are all bad things and all of them (except backing up your computer) were out of your control.  You will likely be sad, be dismayed, and all of this is OK.  However, you do not necessarily need to be stressed out.

These are problems.  They can be solved, one piece at a time.  Being stressed about them, however, does nothing to solve them.  Rather than worrying about them, take a breath and think logically about what you can do to cope.  It is OK to cry.  It is OK to scream, but it is not OK to run like a chicken with your head cut off.

Let’s think logically. 

- First call.  OK, you are being sued.  Let your insurance lawyer take care of the details.  Chances are your insurance will just settle anyway.

- Second call.  This is very sad and it is OK to cry.  Nothing about the lawsuit will change in the next few days, so go ahead and buy the tickets.  Worry about writing the eulogy on the plane.

- Third call.  This is bad and upsetting, but the appropriate thing would be to contact the authorities to find out if you can visit the scene and get an idea about the true damage.  Chances are insurance will cover this too – so the real damage is in the things that can’t be replaced – but luckily no one was in the house.  You can take care of the details when you get back from Nome.

- Fourth call.  OK, this sucks.  Maybe the doctor has some time today to discuss the details.  Otherwise you can learn more about your options when you get back from Nome.

- Computer on fire.  Get a fire extinguisher and put the fire out.  You’ll need a new computer and have lost all of your data.  Accept that.  Get out of the office and go to your public library to order a new computer and tickets to Nome.  Think of the trip as a bit of an escape.  You’ll be with your family – who care about you deeply and will help you cope.

Obviously this is just one way of dealing with these issues, but the important thing is to deal with them.  They are unforeseen but regardless stressing about them is not going to make them go away.

So next time you feel stressed, just remember – you are the one causing the stress – not the problem.

A common question nowadays is still the ever common is now a good time to buy a house?  Typically the asker wants to know what I believe will happen to prices in the next few months to a few years.

However, the answer to this question has always been the same – regardless of the market.  It depends.

“Depends on what?”, you may ask.  Well.  Imagine that you visit a hospital and the doctor gives you the following prognosis.

“It’s looking very bad.  Your heart will just not last and we will need to get your in for a heart transplant before your heart fails.  Luckily, you have a very common blood type and heart type so it will not be difficult to find you a transplant.  Also, we expect that heart transplant prices should fall in the next year.”

Would you wait for another year for lower heart transplant prices?  I would certainly hope not!

“Yeah. OK.  But what does that have to do with real estate?  A heart transplant is obviously more important!”, you might say.

For the vast majority of cases, a heart transplant is certainly more important, but depending on your need for a house buying a house may be extremely important too.

Before we bought a house we lived in an apartment where a number of shady individuals lived.  One day while I was making dinner a man was gunned down in our parking lot.  That night we resolved to get out of that complex and buy a house.  For us, it was extremely important.

Another scenario may be that you drive to work an hour and a half each way and are missing spending time with your spouse and children.  Does it really make sense to not see them for another year with the hope that prices will drop?

If you are buying a house with the idea that it will be your primary investment and you want to make sure you purchase that investment at the best price, then it is correct that now may not be the best time to buy.  It is entirely possible that prices will fall further.

However, if your reason for buying is that you truly need a house, then now is as good a time as ever.  Personally, my feeling is that prices will probably remain roughly stable over the next few years.  They may drop slightly, but nothing like we saw over the last several years.  I do believe they are unlikely to rise for some time though.

So before you ask this question, think to yourself why you want to buy a house.  If your reason results in an improvement in your lifestyle and quality of life, now is as good a time as ever to make a move.

For the last week, the four of us have been visiting Walt Disney World in Orlando, Florida.  I thought that a list of what went well and what didn’t would help both myself and others.

I hope that this information will also help others planning vacations both to WDW and to other places.

What went well

Spending five solid days at the parks

We only visited Walt Disney World itself and avoided other attractions such as Universal Studios.  For just WDW, this time proved to be exactly what we needed.  Had the weather been warmer and we were visiting Blizzard Beach, we would have wanted an additional day.  Given the size of the parks and how much there is to do, five days was just right.

The Disney Deluxe Dining Plan

Disney food prices are quite expensive.  In particular their sit down restaurants are quite pricy.  Breakfast each morning for the four of us was $60.  Lunch varied from $70 to $110 and dinner varied from $90-$180.  These prices do not include tips.  Given these prices, the dining plan enabled us to save significantly.  It also provided us a good break to get away from the chaos of the parks and experience some very interesting restaurants.

Making dining a big part of the planning

In addition to spending a great deal of time figuring out how much time we needed at the parks and in which order we wanted to see them, I also spent a great deal of time planning which restaurants to visit.  A number of the restaurants – particularly Coral Reef, Citricos, and Sci-Fi Diner, have their own characteristics and provided as much enjoyment as the rides.  For future vacations, I will also spend time looking for interesting places to eat.

Planning what rides to go on and when

The parks were a lot more crowded than we expected, but by using the strategy of visiting popular rides early in the morning combined with FastPass, we rarely had to wait.  We did have access to the tour plans mentioned in the Unofficial Guide to WDW mentioned below – but they were basically worthless.  They either did not contain the rides we were interested in, did not factor in eating meals, or assumed we could get our kids up at the crack of dawn to get to the parks before they open.

Filling our days solid with entertainment, combined with resting intervals

In the past, we often felt that we spent too much time at some locations.  At other times, things just moved at too frantic of a pace and we became tired too quickly.  During this trip, we were quite busy while we went on ride after ride, but we had about an hour each for lunch and dinner that we used to relax.  This worked out quite well – allowing us to move at a fast pace but buffer it with relaxation periods.

Taking the kids at ages 5 and 6

We saw a lot of babies and younger children at the parks and many of their parents looked quite miserable.  While WDW rides are in general tame, there are a number of them that will terrify younger children.  Our older son was still scared by many of the rides while the younger one had absolutely no problems.  There are also height restrictions on some of the rides that in a few cases did not allow our five year old to ride.  From this experience five years old is probably the bare minimum I would want my child to be to take them to the parks.  Younger than that and the trip becomes more for the parents than for the kids.

What went OK

Disney’s Animal Kingdom Lodge

We stayed here for the entire trip in a room with a savannah view.  The idea was for the kids to see animals from the room when they wake up and this worked well on one occasion.  While the hotel definitely caters to kids, we were so busy at the resorts that we made little use of it.  In addition, the rooms were quite small and the bed was among the least comfortable we have ever slept on.  I had originally planned to stay at the Grand Floridian but decided against it because I was worried the kids would not find it as interesting.  We visited the Grand Floridian to eat at Citricos and for the hotel itself this assumption was accurate.  Therefore, while I was not very impressed by the Animal Kingdom Jambo House resort, it was probably a decent choice.

The Weather

Of course it is impossible to predict the weather and how was I to know that Seattle would be on average twenty degrees warmer than Orlando while we were there.  On the other hand, except for our last day it hardly rained there.  We were able to do all of the rides except for the water related ones, so it wasn’t that bad.

Going in the 2nd week of January

The guide book listed below stated that the second week in January – after New Years when all of the kids have gone back to school – is the best time to go.  Instead, the parks were quite crowded and we needed to strategize how to see things in order to not spend too much time in the lines.  Luckily, we did not spend much time in the lines do to careful planning – though some rides reached wait times as long as 120 minutes.

What didn’t go well

The Unofficial Guide to Walt Disney World

This book should be renamed – “The whiner’s guide to WDW”.  Most of this book was completely unhelpful and often completely false.  The reviews of restaurants were not accurate and the descriptions of the rides – in particular how appropriate they are for kids – was not correct.  I just really had the impression that the authors have never been anywhere outside of Disney World and have no concept of the outside world.

Disney’s vaunted customer service

When I visited the parks fourteen years ago, I marveled at how happy everyone at the resorts was and the degree to which people (called “cast members”) would go through to make sure you had the best trip possible.  This is no longer the case and I even found the service to be rude on occasion.  In general I would give their customer service an “OK” rating.

The day after Christmas,  I receive the following call

Buyer: Hello, could you please show me your listing at 123 Main St?

Me: I can arrange to have an agent show you this property, but are you currently working with an agent?

Buyer: I do not want to use an agent.  I want you to write the contract for me.  I will tell you the terms.  Agents aren’t worth the commissions they receive.

Me: I’m sorry, but I do not do dual agency.  You will need to find an agent to write the offer up.

Buyer: I will dictate the terms.  I just need you to write it up.  The seller does not need to know that you wrote it.

Me: That is fraud and I cannot do that.  If you’re worried about the commission, why don’t you find a discount agent to write it up.

Buyer: I’ll go to Redfin!

Me: That is fine.  I do not care who writes up the offer.  I just told you I cannot do it myself.  Redfin, by the way, charges one and a half percent and has a minimum amount they need to make.

Buyer: I know that… You just don’t want to leave nice cozy Bellevue.

Me: No.  I cannot write contracts for buyers for my own properties.  It is in your own best interest to find someone to represent you.

Buyer: It’s not worth it to pay any commission for just filling in the blanks on a piece of paper for what I tell you!

At this point I proceeded to lecture him on all the work it takes to actually close a property these days.  Unfortunately it was wasted breath as he did not hear a word I said.  I honestly do not care who writes up the contract for him.  I do not do dual agency and even if I wanted to this particular seller forbids me from doing so. 

From his perspective, this is one example where you can argue that ignorance is bliss.

Why is it the holidays seem to bring out the worst in people?  On Christmas Eve, I receive a call from a buyer interested in a property located next to a property I just sold.  This property is of course listed by another agent.

First the buyer asks me a number of questions about the property.  While I had been in it to do comps I obviously knew little else about it.  She then stated that she is looking for a home for her parents and that I must show it to her that night.

Do they have an agent?, I asked.

She replied that she didn’t know, but that she just wanted someone to open the door for her.  I replied that any agent would want to get paid for showing a listing and that we are not paid unless the listing closes.  I suggested that she use the agent they are working with to open the door.

She then got rather huffy and insisted I show her the house the next day (Christmas Day).  While we do not celebrate Christmas, we do get together with family that day and I did not feel like driving across town that day to open a door so another agent can get paid.

When I refused, she got quite upset, told me off, and then stated she would just call the listing agent herself.

How’s that for holiday cheer?

As most of you know, I deal with several bank owned properties at the same time.  These properties are typically in high demand and therefore I receive quite a few calls a day on them.  I can deal with serious questions, but the following conversation (which on some days occurs every few minutes) really can be frustrating.

Caller: Hello, I am calling about your listing on 33rd Street.

Me: What can I do for you?

Caller: What’s the story behind this property?

Me: Well, what do you need to know?

Caller: Is it vacant? (note that vacancy status is on MLS)

Me: Yes, it is.

Caller: Is this a short sale?

Me: No, it is bank owned. (this is also on MLS . I also explicitly say it is ‘not a short sale’ in the agent remarks.)

Caller: Do you have any offers? (If I have multiple offers, this is also on MLS)

Me: Yes, we have multiple offers.

Caller: Where do we need to be to get it?

Me: I cannot disclose this.

Two minutes later, I receive another call and it starts all over again, and again, and again.

I have tried changing my voice mail to state that all MLS information is current and intentionally do not answer my phone.  I then receive a message stating “this is so and so.  Please call me.’”  When I return the call, the above conversation happens all over again.

Certainly I have noticed that most agents lack attention to details.  If you want the listing agent to be on your good side, calling her with questions she has already answered on MLS is not a good way to start.

Keep in mind that while I am answering these calls I am dealing with distressed homeowners, trying to close transactions, putting out hourly fires, and trying to prevent myself from going insane.

So the next time you call on a listing, please read the information on MLS first as it is current and up to date.

Check out this book!

You may know that my husband is into photography and likely do not know that he is a member of the Microsoft Photography Club. This year Photography Club Members from around the world spent five months assembling and publishing a world-class, fine art photo book. The time and talent that went into this project makes every copy of the book a gift to its owner. We even put a full book preview online (160 pages of preview!) 100% of the profit from sales goes directly to the United Way and you get a valued and timeless reminder of how you too make a difference for those in need.

You can preview the book, or order the book, from your desk. Not only does this book make a wonderful addition to any collection, and a thoughtful gift, each copy you purchase contributes directly to the ongoing, important work of United Way. This book is offered for purchase at the cost of printing plus $25.00. This additional amount is contributed directly to United Way in your name and is fully tax deductable as a charitable contribution.

Even if you don’t think you’ll buy a copy of the book, go take a look at the online preview anyway. It really is amazing!

BTW, my husband’s photo is this one.