Altera

stepping_up_IHB

stepping_up_IHB

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This brokerage has been getting a lot of the REO listings. I feel that they are short changing the banks and was wondering what you guys think, particularly realtors. They don't seem to do anything besides stick with their strategy of pricing a property 10%-20% below market.



They had the listing across the street from me. The kitchen cabinets and counters were taken from the property, but everything else was fine and even above fine with a newer roof, windows, blinds, etc... They listed it for $250K and took an immediate offer for $260K and would only consider all cash offers. It would have appraised for at least $350K. They didn't include any other pictures besides the front of the house and the description is the same one for this listing where they tell you absolutely nothing about the property, just the come home to oc lifestyle garbage and the bit about the permits.



After I saw the Seal property inside I wanted to notify Chase that they gave up at least $70K because of that brokerage.





<a href="http://www.redfin.com/CA/Costa-Mesa/652-Cove-St-92627/home/4561929">652 Cove</a>



This house they have classifed as a fixer, so I was quite surprised to see it yesterday in good condition. It has newer windows, laminate in the living, dininig and kitchen area, newer baseboards, a spa tub, decent kitchen cabinets that could use a coat of paint and formica faux granite countertops that don't have a scratch on them. The add on enclosed porch doesn't look like an illegal one either, but these agents don't seem to want to bother with spending 10 mins at the city to pull the permit. In my two dog walks yesterday I saw at least 10 people viewing the property. They also have the finanancing options as cash or cash to new loan. Doe that mean that they won't take an offer with a preapproved mortgage?



It just seems that these guys are not maximizing what the banks can get and not doing a bit of work for the commission they earn besides list the darned houses with the same canned description that tells you nothing about the home or even the neighborhood.
 
[quote author="stepping_up" date=1242713951]This brokerage has been getting a lot of the REO listings. I feel that they are short changing the banks and was wondering what you guys think, particularly realtors. They don't seem to do anything besides stick with their strategy of pricing a property 10%-20% below market.</blockquote>


Altera is Steve "Failed Economist" Thomas' daddy's firm, that split off from ReMax. Patrick Bartolic (the agent on the Cove house) is the foreclosure king right now. I saw the stack of paperwork on the foreclosure king of Deuce's office, and it ain't pretty. The stack probably weighs as much as your boxer, and Patrick's probably weighs twice as much.



<blockquote>They had the listing across the street from me. The kitchen cabinets and counters were taken from the property, but everything else was fine and even above fine with a newer roof, windows, blinds, etc... They listed it for $250K and took an immediate offer for $260K and would only consider all cash offers. It would have appraised for at least $350K. They didn't include any other pictures besides the front of the house and the description is the same one for this listing where they tell you absolutely nothing about the property, just the come home to oc lifestyle garbage and the bit about the permits.



After I saw the Seal property inside I wanted to notify Chase that they gave up at least $70K because of that brokerage.</blockquote>


One problem here, in order to get a loan you have to have a house that is complete. Not having cabinets or counters means the appraiser has to check off the box that says the home is not complete. So, they could only accept cash offers. If Chase installed cabinets and counters, then maybe you could say it was worth $350k. But last time I checked, Chase is not a contractor. Why would it matter to them anyway? They already wrote the loan down to 20-40 cents on the dollar, so now even at $260k, they get to book a profit, and it gets them some of the cash that they need. Cash is king right now. We were not joking when us bears started saying that years ago.





<blockquote><a href="http://www.redfin.com/CA/Costa-Mesa/652-Cove-St-92627/home/4561929">652 Cove</a>



This house they have classifed as a fixer, so I was quite surprised to see it yesterday in good condition. It has newer windows, laminate in the living, dininig and kitchen area, newer baseboards, a spa tub, decent kitchen cabinets that could use a coat of paint and formica faux granite countertops that don't have a scratch on them. The add on enclosed porch doesn't look like an illegal one either, but these agents don't seem to want to bother with spending 10 mins at the city to pull the permit. In my two dog walks yesterday I saw at least 10 people viewing the property. <strong>They also have the finanancing options as cash or cash to new loan. Doe that mean that they won't take an offer with a preapproved mortgage?</strong>



It just seems that these guys are not maximizing what the banks can get and not doing a bit of work for the commission they earn besides list the darned houses with the same canned description that tells you nothing about the home or even the neighborhood.</blockquote>


The cash/cash to new loan is just a box they check off in the MLS. It is meaningless unless it says cash only, then see above for why.



Don't think the agent is lazy, he just doesn't have the time. This guy is going to make a million dollars this year in REOs, he just has too many of them to do them properly. Once they get a home listed, it is priced to sell, because they have four more in the pipeline. Banks need cash, cash is the strongest offer, cash is king.
 
Does Altera still get the 3% sell side commission? Is there anything fishy about so many of them being concentrated to these guys? It's my understanding that there are a number of agents out there who handled these in the '90's so they have experience. It just seems that if they are too busy to do a half way decent job, then the wealth should be spread around to agents who are experienced in selling REO's and who have the time to do a better job.



I still want to complain to Chase about Altera, but don't know who to contact. I understand that the banks don't want to do cabinets, but couldn't a buyer still get a loan that included money to install the kitchen if they were buying it for much lower than what it appraises for? Even for all cash, $250K was just a ridiculous price to list that house at.
 
[quote author="stepping_up" date=1242719891]Does Altera still get the 3% sell side commission? Is there anything fishy about so many of them being concentrated to these guys? It's my understanding that there are a number of agents out there who handled these in the '90's so they have experience. It just seems that if they are too busy to do a half way decent job, then the wealth should be spread around to agents who are experienced in selling REO's and who have the time to do a better job.



I still want to complain to Chase about Altera, but don't know who to contact. I understand that the banks don't want to do cabinets, but couldn't a buyer still get a loan that included money to install the kitchen if they were buying it for much lower than what it appraises for? Even for all cash, $250K was just a ridiculous price to list that house at.</blockquote>




why would you want to complain? they are moving the crap and getting the market back to order. think of altera as clean up maggot. nobody likes maggot but they are needed to clean up all the crap out there.
 
I would complain because they seem to be short changing the bank. Now that I know that it's related to that goon Steve Thomas, I wish this brokerage even more ill. More selfishly, I would prefer owner occuppied. If they list a property as a cash only far below market it's typically going to get an investor who will just rent it out regardless of the fact that there are 15 people living in the place. We lucked out on the one across the street going to a nice young man who's father and grandfather lent him the money to buy it, but that's not usually the case. There are lots of young couples that would jump at the chance to get into an SFR starter at a reasonable price, but they seem to limit the buyer pool to just the cash buyers.





The house at the end of my street and then the one at the corner have deliberately stopped paying the mortgage, so now I've probably got two more on my street alone that Altera may end up with.
 
First off fixer is relative, I had a friend buy a house they said was a fixer. All it needed was a can of paint and watering.



Why are you so concerned with them shorting the bank? What about when the bank was shorting the consumer?



Before the bubble 652 Cove was not even worth 350k.
 
This is an example of the sales strategy "Stack 'em High and Let ?em Fly!"



There shouldn?t be $100K worth of cabinets in this house. The reality is at some point that spread will narrow ? the sales price will remain $250K, the rest of the market will be pulled down to meet it.



Ain?t I a ray of sunshine tonight?
 
[quote author="stepping_up" date=1242713951]This brokerage has been getting a lot of the REO listings. I feel that they are short changing the banks and was wondering what you guys think, particularly realtors. They don't seem to do anything besides stick with their strategy of pricing a property 10%-20% below market.



They had the listing across the street from me. The kitchen cabinets and counters were taken from the property, but everything else was fine and even above fine with a newer roof, windows, blinds, etc... They listed it for $250K and took an immediate offer for $260K and would only consider all cash offers. It would have appraised for at least $350K. They didn't include any other pictures besides the front of the house and the description is the same one for this listing where they tell you absolutely nothing about the property, just the come home to oc lifestyle garbage and the bit about the permits.



After I saw the Seal property inside I wanted to notify Chase that they gave up at least $70K because of that brokerage.





<a href="http://www.redfin.com/CA/Costa-Mesa/652-Cove-St-92627/home/4561929">652 Cove</a>



This house they have classifed as a fixer, so I was quite surprised to see it yesterday in good condition. It has newer windows, laminate in the living, dininig and kitchen area, newer baseboards, a spa tub, decent kitchen cabinets that could use a coat of paint and formica faux granite countertops that don't have a scratch on them. The add on enclosed porch doesn't look like an illegal one either, but these agents don't seem to want to bother with spending 10 mins at the city to pull the permit. In my two dog walks yesterday I saw at least 10 people viewing the property. They also have the finanancing options as cash or cash to new loan. Doe that mean that they won't take an offer with a preapproved mortgage?



It just seems that these guys are not maximizing what the banks can get and not doing a bit of work for the commission they earn besides list the darned houses with the same canned description that tells you nothing about the home or even the neighborhood.</blockquote>


The market rate for the home was $260k because that is what someone was willing to pay. Their strategy seems to be a winning strategy, list low and sell at what the market will bear quickly. The bank had to agree to the $260k price so if anyone is negligent it is really the bank. The bank should have sent out an apraiser to see if the $260k price was right or not.



The bank doesn't seem concerned and they are probably sitting on REOs that are losing 20% a year. So maybe they are willing to sell now at a 10-20 percent below market now or $260k. Or they could price it at market value now and sit on it for 6 months and then sell it for $260k.
 
I made a comment about 18 months ago that at some point, the banks would have REO's stacked like cordwood and would start blowing them out. At that point, it would be a race to the bottom. I thought it would get here March of '08. I was early.



This reminds me of the immortal words of Keith Richards in the preface to the Rolling Stones concert at Altamont (the one where the Hells Angles ran security). Upon watching a group of attendees tear down a barb wire fence that was in the way of getting to the concert, he said:



<blockquote>''First act of violence'' </blockquote>


<a href="http://www.ew.com/ew/article/0,,299747,00.html">http://www.ew.com/ew/article/0,,299747,00.html</a>



This is just the trickle; wait till the flood gets here. Irvine Renter has not been nearly bearish enough.
 
I have not seen anything posted that would indicate that Altera was not doing their job with all due diligence.
 
[quote author="awgee" date=1242777584]I have not seen anything posted that would indicate that Altera was not doing their job with all due diligence.</blockquote>


If they classify a non fixer as a fixer, do not provide a single description of the home or any pictures other than the front, is that doing due diligence?
 
[quote author="stepping_up" date=1242778301][quote author="awgee" date=1242777584]I have not seen anything posted that would indicate that Altera was not doing their job with all due diligence.</blockquote>


If they classify a non fixer as a fixer, do not provide a single description of the home or any pictures other than the front, is that doing due diligence?</blockquote>


Personally I think Altera are doing a good job. Anything that brings the prices of houses down to a realistic level is a good thing
 
[quote author="stepping_up" date=1242778301][quote author="awgee" date=1242777584]I have not seen anything posted that would indicate that Altera was not doing their job with all due diligence.</blockquote>


If they classify a non fixer as a fixer, do not provide a single description of the home or any pictures other than the front, is that doing due diligence?</blockquote>


You are assuming that your classification of a fixer is the same as either the legal definition or the bank's definition.

Do you know what level of service the bank has requested or maybe even limited the agency to? What were the bank's instructions to the agency? Is the bank thoughtfully avoiding specific liability?









In order to know if Altera is doing their job, one must first know what their job is. I am not privy to their contracts or contractual obligations.

I have not seen anything posted that would indicate that Altera was not doing their job with all due diligence.
 
this is not an Altera issue. Almost all REO agents do significantly less than their organic listing Agent counterparts. REO Agents saw this coming wave, caught it, and now are coasting along. Can't blame them. I'd probably do the same thing.
 
[quote author="Soylent Green Is People" date=1242788814]this is not an Altera issue. Almost all REO agents do significantly less than their organic listing Agent counterparts. REO Agents saw this coming wave, caught it, and now are coasting along. Can't blame them. I'd probably do the same thing.</blockquote>


I absolutely agree. Most REO listings, especially on the low end, have just a minimal description and one photo of the outside. I think they also get lower commisions from the bank than normal, which partially explains their not willing to put in the proper effort.
 
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