2 Years Ago, Homedelete Peered Into His Crystal Ball On This 3-Bd Mediterranean: 5749 N. Manton in Jefferson Park
We last discussed this 3-bedroom vintage mediterranean at 5749 N. Manton in Jefferson Park (although the listing is calling it South Edgebrook) in October 2010.
See our prior chatter here.
Back then, it was a short sale listed at $324,900 but Homedelete peered into his crystal ball and had this to say:
“Not only is it a short sale but it is also a foreclosure
10 CH 21621 on a $306,000 first mortgages; there is also a second mortgage for $55,000 (refi’d from a $34,000 about 7 months after moving in!); this is a B of A first mortgage so it’s subject to the foreclosure moratorium – good luck trying to close this decade. Default hearing is scheduled for December but it’s up in the air whether or not it will actually go forward. Not only that but it has been listed for 257 days making it more stale than the 6 month old open bag of Doritos in my pantry.The house is one story, the rooms are small, the family room is in the basement (and it was recently remodeled probably with the cash out refinance in 2007) – nothing like a once in a 10 year flood to short out all of your electronics in the basement ‘family’ room. I’ll pass on this. I predict it sells as a foreclosure late next year or in 2012 for $200k.”
It’s 2 years later and while it’s not a bank owned property (yet), the lis pendens foreclosure filed in May 2010 is still out there.
But the price is getting closer to HD’s prediction.
It is again listed as a short sale at $230,000.
Built in 1926, there is nothing else in this style in its immediate neighborhood.
It has a spanish clay tile roof and what looks like its original spanish style fireplace in the living room.
The house is built on an oversized 45×125 corner lot and has a 2-car garage.
It also has central air.
Will this house sell before the bank takes it?
And an even bigger question- does the bank even WANT to take it back? It seems like short sales are more profitable anyway.
J. Anthony Rodriguez at Coldwell Banker now has the listing. See the pictures here.
5749 N. Manton: 3 bedrooms, 2 baths, no square footage listed, 2 car garage
- Sold in July 1997 for $175,000
- Sold in August 2006 for $380,000
- Lis pendens foreclosure filed in May 2010
- Was listed in October 2010 as a “short sale” for $324,900
- Withdrawn
- Currently listed as a “short sale” at $230,000
- Taxes now $4832 (they were $4268 in October 2010)
- Central Air
- Bedroom #1: 17×11
- Bedroom #2: 12×12
- Bedroom #3: 12×10
- Family room: 15×9 (lower level)
Turns out, a broken clock IS right twice a day!
my map sez south edgebrook is south of caldwell and between the edens and the forest preserve. This is just Jeff Park.
This little house really ought to sell at this price. It needs work, but it’s livable and charming. Great opportunity for a moderate income couple- a family income of $75K a year can afford this.
Increasing property taxes and falling incomes, especially among moderate income people, will continue to exert pressure on prices, so I wouldn’t expect any appreciation for a long time in these lower-priced properties, and I hope that’s not what people are buying for these days.
Is it safe to assume that mortgage payments haven’t been made for 2.5 years? Basically, the owners have been able to live here for just the cost in tax for long time. Sounds like they got one hell of a deal.
Is it safe to assume that mortgage payments haven’t been made for 2.5 years? Basically, the owners have been able to live here for just the cost in tax for long time. Sounds like they got one hell of a deal.
Probably not even that. Russ can speak better to it than I can,…I think that most mortgages have the taxes bundled into your payment in an escrow account. If you try to do your taxes separate, the mortgage company tells you that you won’t get the best rate in a voice that implies you’ll be paying 1-2 % more or something.
Hundreds of thousands of defaulting home owners got deals just like this, Jenny. Often, they got much better deals. One housing blog I follow, OC Housing News (formerly Irvine Renter) documents in detail one monster foreclosure and/or case of epic HELOC abuse after another, mostly involving many hundreds of thousands of dollars, and a few spectacular cases involving MILLIONS of dollars. The typical case was a house purchased in the 90s or before for, $200K, or $300k, from which the “owner” extracted as much as double the original price, often $500K or $600K on a house costing $250K or something like that, originally, by a series of cash-out refis and HELOC loans. I have a couple of friends who sold mortgages during the bubble run-up, and they did most of their business on cash-outs and HELOC loans. The amounts of money involved were usually staggering relative to the value of the place and what the owner paid for it, and to the borrower’s income level.
The injustice of it is sickening. These HELOCs and refis usually were spent on “bling”-cars, boats, boob jobs, vacations, frivolous home improvement such as pools and additions twice the size of the house. The money was spent to support the borrowers in lifestyles way beyond their incomes, no matter how high or low those incomes were. Then, when the loan recast or reset, and owners were confronted with payments 3X the original, they just “squatted”. Worse, the more expensive the house and the bigger the debt on it, the longer the squatting time. Right now, there are, in Cook County alone, about 5X as many homes in some stage of delinquency or default as there are homes visible on the market, because the banks do not want to show these losses, which are often in excess of $700K.
Then, on top of all this, the tax laws were changed in 2009, as part of the housing assistance package, to remove all tax consequences for mortgage deficiencies and HELOCs defaulted on. Usually, the borrower would be taxed on the gain that was the deficiency forgiven in a short sale, or a HELOC loan written off.
So, these borrowers got gifts of “loans” many times the original purchase price of their homes, and don’t even have to pay taxes on them, while first-time buyers were (and to some extent, still are) shut out of the market by prices artificially levitated by super-low interest rates, and tax support of the banks, and the government-backed loan market. Worse, savers and seniors are getting absolutely hosed.
It certainly makes me feel like I was the idiot to save 20% for a down payment and live within my means.
@jenny, what year did you buy and did you have the option to put less down or do some other creative financing?
I bought a couple years ago. I didn’t even ask about creative financing because I didn’t want to pay PMI. My parents bought a townhouse in the same area in 2003 and they put down 25%, without asking about creative financing. My place is most likely worth a bit less than I bought it for and would be underwater if I didn’t have my down payment. My parents’ place would probably sell for about $100k less than they bought it for, but they aren’t underwater because they put down so much.
It makes me think we’re the idiots for not putting zero down and then living for free for years and years while the bank waits to foreclose.
Do the banks at least go after the “owners” if they “owners” have money in the bank or garnish the wages of those who don’t have money saved?
Jenny, I don’t think it’s worth being bitter. These people have destroyed their credit scores and probably been miserable in the process. If they’ve gotten their comeuppance by now, it will eventually come around to bite them in the a@^. Should you have rented then instead of buying if you’re cranky now? Maybe, but hindsight is 20/20. Should you have just not paid your mortgage and entered a financial disaster? No.
Sorry I’m late to the party but my predictions which everyone thought seemed outlandish at the time are coming true. I think a little outside the box and quite often I’m right, usually more than twice a day too.
I’m not bitter about my decision to buy. I find it irritating that the government bails out the irresponsible people who game the system.
Illinois is a recourse state. The bank can go after you for back payments. So if you think you can just do a short sale and walk away- think again. The thing is- many people doing short sales genuinely have no other assets. I know someone that did a short sale so they could move out of state. They had nothing. They had two loans. The bank on the second (which was going to get wiped out) threatened to put them on a 10 year repayment plan for the $50,000. They told them they’d just file for bankruptcy instead. When push came to shove, the bank backed down (but did require some back payments- just not all $50,000.)
The reason the famous basketball players can do a short sale in, say, California and walk away is because that’s a nonrecourse state (the bank can’t go after your other assets there.)
Also- someone brought up the change in the federal law so that the difference was not taxed by the IRS. Don’t forget- that expires at the end of the this year. With the election going full steam- I doubt it will come up until December (with a lame duck Congress.) Will they vote to extend it? Or will it finally fade away?
If they don’t extend it- millions of people will be in severe pain having to pay income taxes on those mortgages.
House is ugly and doesn’t fit style wise in Chicago that’s why it didn’t sell then. I can’t stand those Spanish style randomed in to the NW Side.
There’s a handful of these spanish style homes built all over the NW side and into park ridge. There’s a hole block of them, on crescent, in park ridge, if I believe. They’re a lot bigger though. Awesome looking homes but definitely not for everyone. not many people want marble floors these days.
Are Spanish style homes difficult to maintain in this climate?
I don’t think they’re particularly difficult. It’s stucco so that needs to be kept up and the clay tile roof lasts a long time, but it’s expensive to fix or replace. Renovating is fairly pricey though, because the wires and pipes in the walls usually date to the 1920’s, and the windows are either original, or if not original, are usually custom shaped. I’ve seen a handful of these and one of my friends owns one. They’re always dated on the inside and need work, but you know the saying, ‘if you do a little bit of work at a time, at the end of a few years, you’ll see how little work you’ve done’. So tehre’s a kitchen upgrade here or there, and a bathroom here or there, but it’s piecemeal and not usually style coordinated. That’s why i’m of the opinion to just do it all at once. $100k would go a long way on this property.
Yeah, I think for $75-80K you could get this one into good shape.
It’s not stucco.
Actually, I take it back, if it’s really that old it probably is actually stucco. That is a black flag for me in this climate, probably one of the reasons no one is interested in this even at a list price that has to be getting within 25% or so of a teardown price for an almost double lot, maybe?