This estate was purchased in 1998 for $2,225,000, refied in 2002 for $2,200,000, refied in 2003 for $3,500,000, and refied in early 2006 for $4,590,000. There is a $350,000 HELOC in 2007 (which may or may not still exist) and another HELOC for $500,000 this January. Current listing price is $6,850,000, and the wording makes it look like a short sale offering. I can’t find documentation of the extra indebtedness that would make this a short, but it may be out there.
The refi in 2006 was a 110% Option ARM with a $15,731 minimum payment, and a $32,487 fully amortized option for the first year. That’s a bit over $200,000 negative amortization possible in the first year. I’ve never seen this before, but the annual reset was capped at 7.5% over the existing payment. In any case, it looks like the Option ARM topped out or the owner just quit sending in those monthly checks, and a NOD was filed July 12th.
This property does have some forward looking development possibilities. It also has the most butt ugly carpeting I have ever seen outside a double-wide. But where else can you find a floating dining room with bonsai?
Hey, it’s been a rough week for all of us. Thought you campers could use some comic relief, though this seller certainly isn’t laughing right about now. This is the Trash Talk Weekend Posting, so use it as springboard to bring up anything you want to talk about. Still, be kind.
Paul
Sometimes a foolish lender makes the best buyer. They already got their equity out, and they still get to live there (for a while longer). Great find mike!
Josh
Here is the website for the property:
http://www.steenmansion.com/
BanteringBear
Paul makes an excellent point. These people, and countless others, aren’t losing their homes. They sold them back to the lender via HELOC, and got peak pricing to boot. If one doesn’t care about credit score, or their own moral compass, it was a fine play. The banker was the one with a bucket of money and a box of stupid.
Inclinejj
Someone really liked the ’70’s and the old Peppermill..
Perry
BB makes a point of something that I’m having a hard time reconciling. Where did all the bubble money go? Builders made money, individuals (stole in my opinion) heloc’d money. Now R&B is bankrupt?? Did they stuff all the cash in the stock market and now it’s gone or is it in the Hummers and BMWs I see? Did they eat it at Chile’s and Red Robin? I’m at a loss.
Mike
Sorry Mike, 16,000 square feet just isn’t enough for me. I need 16,010 square feet.
Perhaps the bank can convert it into a branch office.
BanteringBear
Perry posted:
“Where did all the bubble money go?”
My guess is that most of it was poured right back into real estate, or spent on a lifestyle of consumption which included big ticket items like new cars, boats, motorcycles, vacations, etc. Check out craigslist. There are sooo many items of this nature for sale that it boggles the imagination. One thing I have observed: used Harley Davidson’s are selling for drastically reduced prices compared to those of yesteryear. It’s liquidation time for many.
Paul
The dilema of a development company during a boom is this: once you sell your completed inventory at inflated prices, what do you do with the cash? Either buy more land at even more inflated priced or go out of business. The inertia of an ongoing concern with staff, investors, etc means that they will always choose the former, even when that is not the right thing to do.
Reynen and Bardis bought the old Callamont project for about 25M. Anyone know what will become of that?
smarten
Interesting observation Paul.
So what does a gambler do with his/her winnings?
billddrummer
To Mike,
On the property in Washoe Valley:
Looks like the owner sold off some of the water rights on 9/19/08, but the proceeds weren’t enough to prevent the NOS from recording, if that’s what he did with the money.
I met a couple who had supposedly put in an offer on this property earlier in the summer. Looks like the offer went up in smoke.
GreenNV
Paul,
R&B bought Callamont for $16,500,000 in Feb 2005. There may be other loans somewhere in the tangled web of R&B sub-companies. The loan was extended 3 or 4 times, and a NOD was filed in March. The project may not be completely dead yet – Washoe approved their Development Book in June.
I think the actual foreclosures on R&B properties has been complicated and slowed down by Bardis’ personal bankruptcy filing in Sacto. Until today, TDs weren’t getting filed. However, they just lost Verdi-Mortensen. $3,462,401 owing on the loan, and the lender took it back for $2,250,000. There is a sign up on the property already – I’ll try to swing by tomorrow and see what is up.
Reno Realty Blog: Reno Real Estate, Market & Trends, Nevada » A Morning on the Courthouse Steps
[…] these loans? Another one of the postponements today was 4045 Old Highway US 395. profiled in The $5,270,503.38 NOS back in October – pure […]