Monday, December 28, 2009

David Crisp, Part 2

David Crisp
Formerly of Crisp & Cole
(Part 1)

Crisp's actions "epitomized the rampant greed that contributed to the market collapse," Real Estate Commissioner Jeff Davi said in a statement released Monday. "He should not be allowed to work in any capacity related to finance or real estate."


2009-11-23: David Crisp banned from real estate for three years
The California Department of Real Estate has barred former real estate agent David Crisp from working in any real estate-related field for three years.

The ban applies to all real estate firms, including lenders, banks, escrow companies and title companies. It became effective at noon Monday, the same day the state announced its order.

Crisp had initially intended to fight the order and two hearings were set, but he failed to show up to either one and lost by default, according to Department of Real Estate spokesman Tom Pool.
In September, Jerald Allen Teixeira, a loan officer who worked for Crisp and Cole for more than a year, pleaded guilty to being a part of mortgage fraud. He was offered leniency in exchange for promising to assist federal prosecutors.
(Part 3 is coming for Crisp, I'm sure)

Sunday, December 27, 2009

Strategic Defaults

Strategic Default: Heather Baker

I don't fault Ms. Baker for walking away. It's the right financial decision, she had no skin in the game, and the banks got exactly what they deserve. However, can she really afford it? Using traditional guidelines for affordability, Ms. Baker should have yearly earnings of...
$465K * 0.36 = $167K
It's possible she earns this, but I seriously doubt it. Can she truly afford a $465K mortgage? She was nothing more than a house debtor that got caught in the middle of a massive housing bubble.

2009-12-25: Walking Away From The House She Can Afford
Many homeowners who are tens thousands of dollars underwater on their mortgages — meaning they owe more than the value of their homes — have decided it's just not worth it. Some, like Heather Baker, can even afford their payments, but they're walking away anyway.

Baker is done with being a homeowner. Last month, she stopped paying her mortgage.

She figures the house she bought for $465,000 won't sell for more than $225,000 now. That lower figure is what a house down the street went for earlier this year in a foreclosure auction. Like a lot of people, Baker bought her house with no money down. The mortgage broker she worked with told her she qualified for the loan based on her credit score alone.

9100 Granite Ct, Waldorf, MD
5 beds, 3.5 baths, 2,302 sq ft

Sale History
07/28/2006: $465,000
11/12/2003: $289,000
11/24/1998: $199,948