Perrysburg Blog

The walkaway.

The “strategic default”.

The “jingle mail”.

You can look up the term on line.

But it happens when your personal life and your financial life have collided with your real estate life and the value of your real estate is smaller than the amount owed the bank.

The process is painful.  Traumatic. And fraught with risk.

Earlier today I went to a house, which shall remain hidden from identity for now (see description above . . . ), which was very nice.

Whose professional, educated owner had walked away from.

Gone.

Vanished.

Spurned our offer of “cash for keys”.

Turned off the water and the gas and the power – and vanished in the night.

Some thoughts:

1. Talk to your lawyer before you do this.  Seriously.  Just get a lawyer and get their opinion on what to do next.

2. Get help from ANYONE.  Family.  Friends. Charity.  Even the Federal Government has lots of programs.  And as worthless as HAMP or HEH! or HUH!? have been in the past 2 years – at least they often slow down the foreclosure train a little bit and give you time to recover.

3. Do not stop paying your food/gas/electricity/heat in order to make one more interest payment to the bank.  Sit down and think about what you have to have to live and survive.  Get some counsel.  Get some special help – but don’t lose everything in order to save an upside down, underwater house.

4. Get another legal opinion – lawyers are just like every other profession.  There are good ones, bad ones, and ones that do not know what they are talking about.   Get 2 opinions when you need brain surgery.  And 2 legal opinions when you are thinking about walking away.

5. At least call the broker/agent who was trying to talk to you.   This vanished owner lost $3000 simply by not calling me.  I bet he might have needed that money . . .

6. Put your families finances first – see #3 above.  I cannot stress this enough!

Many homeowners are being forced into this hard, cold calculus.  Banks might want to consider some very aggressive modifications to principal and not just kick the can down the road.   When upscale neighborhoods in Wood County are being hit and ravaged by strategic defaulters – it’s time to change the game plan.

Practice.

Preparation.

Organization.

Research.

All equal to success in lots of endeavors.   Like in baseball.   And in real estate.

Do it . . . and your ducks are in a row.

Fail?  You will whiff.  You will miss.  You will not win.

If you strike out in baseball . . . you get another at bat . . . usually.

In real estate?  You may lose the home you HAD to have.  The “perfect house”.

And, not surprisingly, real estate agent batting averages, proficiency, and skill set strength might seem to matter.

Especially in light of the new NAR report on recent sales.

If you peel away the data . . . you will find that the percentage of pending sales that blew up – busted out – failed to close . . . has DOUBLED.

That’s a HUGE increase.

I believe there are a couple of reasons:

1. More and more appraisal problems with pending sales.

2. More REO transactions which are very hard to get closed.

3. More part time / old timey real estate agents who don’t sell anymore and don’t swim in these treacherous waters anymore.

4. Short sales – the modern bane of buyers, sellers, and agents.

Add them all up . . . . and it’s a miracle MORE deals than the 18% reported are not blowing up!

(by the way – it was 9% of all pending deals blowing up just a year ago . . . )

What to do?

Get accurate market data.

Thinking about buying a short sale?  Open your eyes, get the facts, and get some help.

Only hire an experienced, competent, skilled agent.

Nope.

Not now.

Not when this: Local Plant Closes Due to Ohio EPA Rules is happening.

214 GREAT manufacturing jobs.

214 bread winners.

214 actual or potential homeowners.

214 new foreclosures?  214 destroyed families.

Why?  Because some Columbus-focused bureaucrats decided to close this plant.

Note this well:  There will be NO HOUSING RECOVERY while such decisions are being made.

The lifeblood of Northwest Ohio is being shipped off – factory by factory and line by line – to Indiana, Tennessee, Mexico, and China.

Your house just went down in value.

Your prorata share of taxes is going up.

Because 200+ jobs are leaving Wood County.

The people doing this need to be hounded from office.

The destruction of jobs is destroying real estate.

Indiana is CROWING about their new corporate addition.

We keep driving jobs out and raising taxes.

Why?

The casino is coming . . . details here.

Why is that bad news?

Inevitably, after a 2 year latency period, the incidence of crime against people and crime against property increases.

Every time.

Everywhere a casino is built.

You can count on it.

Build one in Wood County?  Along the Maumee.  Or in the “Golden Triangle”.  And there will be negative, deleterious effects on the values of Perrysburg homes.

You can “BET” on it.

The scholarly  paper on this is interesting reading.  And sobering reading.

Here is the paper by Earl Grinols and David Mustard.

The casino lobby will never stop.  They will try and try and try – stopping only when they have fooled enough people.

Things will be great.  For a couple of years.

Then the neighborhoods closest to the “Crossroads Casino” will start to be negatively effected.

That negative trend will then metastisize and spread.   From Starbright to Belmont to Three Meadows and beyond.

Theory?  Supposition?  Hardly.  Read the literature.  (page 14 shows how MILLIONS in lost property values is the result of the “jobs creating casino”.

Bring on a casino I say.

But build it RIGHT NEXT to the Toledo Correctional Institution on East Central.

Crimes against people.

Crimes against property.

Visitor crimes.

Criminal gambling.

Costs of addiction to gambling.

Increased rapes.

Increased police costs.

We neither need nor want these things in Wood County.

The day they get their way is the day we start to pay.

Usually 1 time a month the Sheriff of Wood County has a duty to do.

(Unashamed plug: Vote for Sheriff Mark Wasylyshyn’s Reelection in November. Honest and brave and incorruptible. All true. But he also is a BUDGET HAWK who cuts and cuts and cuts waste and fraud. A graduate of free-market loving Hillsdale College (www.hillsdale.edu) The Sheriff HAS to do the Sheriff sales – it’s part of his job. Most fob it off on others. But not Waylyshyn. He PERSONALLY handles it. So – he needs to be reelected, in my opinion. A great leader and a great sheriff.)

Anyway. I digress.

Sheriff sales.

Horrible data to study and rely on.

Inaccurate.

“Laggy”.

Not a full picture.

Subject to “take aways” – it was a foreclosure but we pulled the auction and did a short sale – it was a foreclose but they filed for BK and tied us up for 90 days, etc.

The “laggy” part happens because the banks are getting around to the sheriff sale part 90 to 180 to 270 days after the late payments and slow payments and defaults and work outs and other various and sundry means and methods have been tried to get their money from the mortgagee.

The sheriff sale is it. No more talking. We are done. (Not really. They will still talk – but that’s another story, for another time!).

So the Sheriff of Wood County has been busy lately.

How busy?

Note the trend.

Up and up and up.

But keep in mind the lag effect.

And the unseen pull backs and delays and push backs. So this unscientific and admittedly crude chart is not totally accurate.

But it shows the tempo of the market. And the pace of Wood County Sheriff Sales.

And the people who have been paid millions of dollars of salary and bonuses to run their companies into the ground?

In my opinion they should be forced to disgorge those ill-gotten gains. They should see the carnage their financial alchemy has created here on the ground in Wood County Ohio. People have suffered. People have been misled into buying and borrowing. Oh, they signed and were disclosed. But the destruction we are all witnessing HAS to have consequences.

Beyond just the Sheriff saying “SOLD to the high bidder.”