Jason Bramblett Real Estate Show Podcast
Jason: Good morning, Triad. Hope everybody is doing fantastic today. A lovely, crazy, spring-like week we have had. It is the weirdest weather in North Carolina. You are listening to the Jason Bramblett Real Estate Show. But hey, if you do not like snow, pretty awesome start to 2020. I just saw one of my buddies that I have up in Fargo posted a photo of somebody, their car is frozen. It is 24 below zero and he is like, yeah, those people are not going anywhere.
Keith: Look, I grew up in Michigan. So I kind of am feeling cheated out of winter now. I am not talking Fargo. I do not need that.
Jason: Yeah, that is crazy 24 below.
Keith: I have lived in Michigan. It happens.
Jason: It does. It does.
Keith: Not often, but it happens.
Jason: Yeah, he actually told me this this time of year they have a special drill bit that they have to use to basically go in and like an auger to get their real estate signs in the ground because the ground is so frozen. There is no chance you would ever get one in the ground, and that is just business as usual. No big deal.
Keith: Why not?
Jason: We are still trying to figure out how to drive in the rain down here, but we are getting a lot of practice.
Keith: That is true.
Jason: Here is a question. We have talked a few things about goals and different things since December, but the question is this going to be your year? You are maybe to upgrade, downsize, buy your first house. How about getting that on the Bucket List. Right? Buy that first house you, maybe a bigger home with an amazing yard, or maybe it is time to step up and get that farm and join us agricultural lovers out here that have plenty of yard ornaments as I like to say. The people I know that actually farm they look at what I have and they are like, yeah, that is not a farm, man. You got land with yard ornaments.
Keith: You can farm anywhere. I live in the city and my neighbor has chickens. You can do it anywhere.
Jason: That is true. Actually, it is interesting. In the past five years, it is kind of weird. You could be downtown Winston, Greensboro, High Point, and everyone once in a while, you will catch a little chicken out of the side of your, it has become a little bit of a fad which –
Keith: True story.
Jason: It is kind of cool. Everybody has got their thing. Right? But whatever you are dreaming about we have got a solution for you, and really if you can think about it, we can find it. If you could think about it and we cannot find it, then we can find somebody that can build it for you. Only then you need to have is some vision and some money if you are going to build especially. Especially if you are going to build unique. You need to have money you are going to build unique. We had a client that we had looking for seven years for this really unusual specific property. And the cool thing is we kept digging and digging and digging, and they did not even go in the house. It was like drove on the property. This is it. No other questions need to be, it was just they just felt the energy when they got there, did not really care about the house, did not make any difference. It was the perfect spot. The perfect setting and everything else. Now, we do not really want to work with everybody looking for seven years. We hope that we could find you, well, we know we can find you something much sooner than that. Keith get even attest to that, right?
Keith: Yeah, I know.
Jason: Yeah exactly. So but if you have something really unique, something that is not your just go-to standard house in the Triad area, give us a call. We have folks that go out there and we will beat the bushes. We will do whatever we can to find what you are looking for. The cool thing about it is it is actually fun. It is cool to take those unusual desires that people have and be able to steer them in the right direction and get them there. So are you ready for the next step? That is the question for 2020.
Keith: Well, let's kick off the show or at least let's continue the show, I guess –
Jason: Let’s do it.
Keith: -- with an email. Steve writes Jason, I have recently been transferred out of state. I have fallen behind on my mortgage payment. I believe I am just about $6,000 behind. The bank has suggested that I start a short sale. Is this something you can do? I listen to your show every week. Thank you.
Jason: All right. Well, hey man, very good. Well, yes we can, and it is interesting how many of these calls that were getting. It is kind of one of those things like jumbo shrimp. It does not make sense. It is like the market is, inventory is low. Homes seem to be selling quicker than normal. We are seeing a little bit more of a lag and days on the market building up. But in this type of market, you would not think you would run into short sale situations. And here is the thing. Life is happening to people all the time in many different ways even back in the good old days, whatever that was. But I remember in 2004, 2005 when you could breathe and get a mortgage. Right? We still had an unbelievable amount of foreclosures. We still had the beginning of short sales because there are just things that happen in people's lives. One size does not fit all. You say well man, just put your house for sale. That does not necessarily work for everybody. There are their situations others. Sometimes there are physical limitations. Sometimes there are limitations with the home itself. The disarray it is in. So even though the market is good, it does not necessarily mean, it does not fix everything. What our friend Steve here has figured out is just because the market is hot right now, depending on when he bought his home, he could be in an upside-down situation. Right? Short sales are an option that the bank has created to really help people avoid foreclosure. It also does save the bank some money because a foreclosed property is much more expensive to really take through that process, to carry and deal with that. So for those that do not even have a clue what a short sale is because you did not live through the last transition of a real estate or were not in real estate or have no clue or were not in the housing market, a short sale is simply this it is the mortgage company agreeing to take less than what you owe on the house in a predetermined amount and then the home is sold for that amount. Sometimes you have to pay it back. Sometimes you do not. It just depends on the type of mortgage you have and the situation that you are in. Hardship plays into that. You do have to qualify for a short sale. So a short sale is not for folks that just have the money and choose not to pay their mortgage. That typically is not a qualification. There needs to be a hardship. A job transfer, moved out of the area. It could be anything from loss of job to death to divorce to whatever. There are a hundred different reasons out there, but it has to be a reason other than hey, I am making plenty of money and I just choose not to pay anymore. That one does not typically work. Unless things get really, really bad, and then the bank does not even care about that, but we are certainly not there this time.
Keith: Not right now.
Jason: Not right now anyway. So yes, short sale is something we can definitely handle. We probably did over a thousand of them in the last decade through the downturn in the market. And here is where we see the biggest issue with some people just do not understand. How could you be behind on your mortgage? How could you not sell your house and just get out of it? Why do not you just sell it, get rid of it? And it goes back to how did they finance it. Did they do a 100% loan? If you put no money down in the transaction, it takes years and years and years of ownership to pay down the mortgage enough to get the zero when you go to sell it is going to cost you 7-10% to sell your house. That is just period. By the time you factor in real estate commissions, closing cost, moving expenses, trucks, all the things that you have to do, it is not an inexpensive decision. And if you are at a 100% of the value of your home and you have been in it for a very, very short amount of time, most people just do not have the equity, and they do not have the savings. We are still a paycheck to paycheck, live month-to-month society. Most people do not have $50,000 sitting in their bank account just to be able to write a check to sell their home. Very, very few. So the less you put down. This is what we teach. The less you put down the longer you need to stay. You cannot buy short-term with long-term financing. It does not work. Actually if you look at a 30-year mortgage you really do not start making traction on your mortgage payment until about year 11, and then you really start to see it exponentially compound. But if you do a 15-year loan, you are putting more to principal than you are to interest especially with rates the way they are today. Financing on a short-term with a low rate really is the greatest way to build equity as fast as you can or at least pay down your mortgage. So yes, home values have gone up, but typically they are not going up seven, eight, ten percent a year. There are some markets where we have seen that, and there may be arguably even some neighborhoods within the Triad that have seen that in the past say 24 months, but it is very few. It is not the entire market, and then the problem with that is when you take a market such as, it happened in certain areas of Raleigh certainly in Charlotte, Austin, Texas, Miami, you have got these micro markets in states where home values did go up 10%. Colorado be a perfect example. Colorado has been unbelievable. The property values in certain cities in Colorado have doubled in four years. That is amazing. The problem now nobody can afford to live there.
Jason: The local people are the ones that actually lose in that deal. So you had a house that was worth a hundred grand and now it is worth 200. You are like awesome, but you cannot afford to sell it because everything is 200 grand, and your wage did not go up in proportion to the value of the homes. This is where you see when you have outside influence, which is what they have had in Colorado. You have people bringing money from other states that is not local, that artificially jack up that value and then you get in the situation where okay, I bought a home. I bought it for 200, which is kind of artificially inflated. and then it stops and then it starts to go down very quickly and then your $200,000 home is now a hundred eighty. Okay, but now you need to sell and you thought you are in there 200 grand. You have got a problem.
Keith: Yeah, you have got a tough spot.
Jason: You got a tough spot. So not only did you lose some inequity, it is still going to cost you about 10% to sell the house, 7-10, somewhere in that range. So when these life things happen, and I have seen more people lose their home actually because of what they thought really was going to be a benefit, a job promotion or relocation. Yeah. Man, what a blessing. I got this new promotion and I am moving the Texas, but I cannot sell my home. They end up paying them higher rent, which you cannot get out of either, right, and then you got the mortgage. No matter if it is rent or mortgage, people typically pay for where their head is laying. Right? So if I am in Texas and my house is empty, I am probably paying my rent in Texas and not my mortgage in North Carolina, right?
Jason: That is typically how it works. That is a scenario we have seen over and over and over again. It happens really daily with the moves and the transitions, but when we have a downturn in the market, then everything is kind of exponential. Kind of a long story to get to really Steve's point, which is yes, we do work with pretty much every bank under the sun to do short sales. We are doing short sales right now. We have people that are in those situations. We have the ability, if they have the equity, we do also have our 72-hour offer option in which we could take your home to an institutional venture capital company and see what they would give you for it as well. Typically, they do way better than the We-Buy-Houses-type properties out there. Those type of investors, because they are buying on scale and when you are buying a hundred thousand houses nationwide, you typically can pay a better price than the guy that is only going to do four.
Keith: Sure. It makes sense.
Jason: The scale of what they need to make is a lot different. You can call our office anytime, 553-0796 to get information about how we can help you with that short sale.
Keith: Can you talk a little bit about to you talk about your 72-hour deal? Let's say you do not want to short sale. You do not want to foreclosure. Can you talk a little bit more about that if you are going to go that direction?
Jason: Sure. Well, another option. So if someone is being relocated, typically they do not want to keep the house. We look at it three ways. First way, can we sell it and just get you to 0 and out of the house if you do not have the equity? The second thing is can we get somebody else to pay your mortgage? Could we rent the house –
Jason: -- and buy you some time? Right? It may be, we will use even numbers because it is radio. It is easier. Let's just say your mortgage payment was $1000/month, but you could comfortably pay $500/month still. What if we could find a tenant they could pay a 100% of your mortgage and then you take the additional $500 and you pay your mortgage down over the next two or three years. Eventually what will happen is either the market will improve or you will have paid down enough on your loan at least you could sell it and get out of the house. Yes, you are going to lose all the money. but there is no guarantee of owning anything. You are going to make money, right? How many people have ever bought a new car and actually sold it for more they paid?
Keith: No one.
Jason: I do not think anybody I have not met him yet. Yeah, actually who has even bought a used car and sold it for more than you made? Other than people that are professional car flippers. Right? Most people do not. It just does not work that way, right, and there is no guarantee with your home. Typically, once anything is used, it is just that. Used. There are two different prices. Right? The new price and the used price. Typically people do not pay as much for used stuff. Right?
Jason: Yeah, like 99.9% of the time, right, until it becomes really, really crazy old and only like 1% of 1% of people want it and they call those antiques.
Jason: Yeah. That is a whole different deal.
Keith: Also known as rustic.
Jason: Rustic. Yeah also known as boring, but I said do not take it out on anybody else. So yeah antique and I have never really got into it, but I get it. Everybody has got their thing
Keith: It is a thing.
Jason: It is a thing. It is cool. It is cool. The history of it is cool. But anyway options. Yes, so can we sell it? Can we rent it? And then of course, yes, we can go back to the short sale. We do have the 72-hour off offer option. Maybe you have some money saved, but you do not have enough but maybe one of our institutional investors can help you out. I have actually been very, very pleased with the offers that they have made. Yes, we 100% can always sell your home for more than they are going to offer. No question about it, but for a lot of our owners and a lot of folks listening out here, making money on their homes is not their primary goal.
Keith: Time is money sometimes.
Jason: Time is money. The convenience of not having to deal with doing it the normal way is more important to them than an extra $5,000 or whatever the number is. They are willing to pay for the convenience as we talked about many, many times. So all right, you have got many, many options. The first option, the first step to everything is always this give us a call.
Keith: Get it started.
Jason: Yeah got to get it started. 553-0796 or go to Jason Bramblett dot com. We will do this. We will take a quick timeout. We will regroup. We got more of your emails coming your way. You are listening to the Jason Bramblett Real Estate Show.
And we are back. You are listening to the Jason Bramblett Real Estate Show. So before the break we were talking about short sales options, whether it be the 72-hour option. You guys probably see all over the place. We do have a few billboards up.
Keith: One of our listeners happened to see one.
Keith: There is one right outside our office.
Jason: Oh, that is right. There is yeah, there is one, right?
Keith: Yeah, we see it every day on the way into work.
Jason: That is right. That is right.
Keith: It says Jason I saw your billboard, well actually I have noticed a lot of the billboards and that is true. Could you tell me more about the 72-hour program? Thank you, John. And he says PS, I have owned company for 30 plus years. Great job on the advertising.
Jason: Good deal. Well John, thank you for that. And hey, this is 22 for us. So we are catching up. It is amazing that it has been 22 years. It seems like just does not seem possible.
Keith: When you are doing something you like.
Jason: It is just yeah.
Keith: It goes by.
Jason: I know somebody asked me the other day. How many hours you work? I do not keep track of that. That is not even in my wheelhouse.
Keith: That is the sign that you should be doing what you are doing and that you enjoy it when you do not have the slightest clue whether you worked 40, 60, or 80 hours because you just do it.
Jason: Yeah, now maybe some days on my wife's wheelhouse. Yeah. I have gotten a few calls at the office before. She is like, it is 8:30. I am like, oh it is dark outside? Iam sorry. I will be home in a bit. Sorry. This is like I kind of get in the zone and then everything kind of just goes away, right? So but yeah, it is a fun time of the business because we have got so many more options than we used to have. When I started there was an option of this: sell your house keep your house or rent your house. This whole idea of flipping homes was not even a thing. It really was not even a thing. Most people bought homes and kept them as rentals or something. And now we have Wall Street involved now. We have these venture capital companies where large institutional groups are coming in and buying homes and keeping them as investments. And so we have been fortunate through me just traveling all over the United States and meeting with different people and companies, and actually I think we have done a really good job with three or four really, really solid companies all that have a little bit different goals. We do have some that are the buy and flip, but a lot of them that we want to work with because we find they will pay more for the property are the buy-and-hold type. They are actually wanting to add it to a portfolio and keep it as a rental property. And typically, they will pay a premium to somebody that needs to get profit out of it in a shorter amount of time. So those are the ones that we have aligned ourselves with. The process is pretty simple. We are going to list your home, put it for sale just like we normally would, and then we are going to give you options, multiple. You are going to have the option of selling it traditionally just like we would sell anybody's home. If you want to look at the 72-hour offer option, we will get that for you and get it in writing and hopefully have multiple options for you to consider. We also have our guaranteed sales program where I personally will guarantee to get your home sold or I will purchase the house and all that is determined upfront. The price that I am going to pay or we agree on is all determined ahead of time. So we have many, many options. The whole one-size-fits-all thing is not really what the consumer is looking for anymore. And so we do have those options out there. It is really not anything really major. The start of this is not anything different than what we normally do. We are going to send one of our representatives out to the house, meet with you go, through the plans and the system for the 72-hour offer. They are going to go ahead and take some pictures. They need to know some information. They want to know how old is the roof and how old is the heating cooling system and what is the square footage? Are you upside down in your house? So, they do actually want to know your loan balance. They do not care what you owe. It does not factor at all into what they are going to offer you, but I have seen where some people are severely upside down and one of the questions they need to know is okay, if you accept our offer, do you have the money to bring to closing because they are going to tie up lots of resources and equity and time and all that, and they need to know that you can actually sell house. We never used to have the ask that question at all and then the state actually put it in the form, into our standardized forms because about eight years ago, we had real estate agents that would show up at the closing and the owner would have to bring a check for like 15 grand and the owner just thought that the bank would just let them keep on making payments. It does not work that way. So anyway, you got to ask the right questions. Right, guys? It is all about those proper expectations. We will go through the condition. They look for anything that is structural. Sometimes they will do a home inspection, but they keep the process very, very simple. So if that is an option you would like to talk about, you can go to Jason Bramblett dot com, reach out to us or give us a call the office 553-0796. We are here to serve you. However, we can and we look forward to speaking with you. Everybody have an awesome, awesome weekend. Be safe out there and we will be back here next week. You are listening to the Jason Bramblett Real Estate Show.