Short Sale

The purchase of the property described in my last post will definitely be a short sale. I discovered that the seller's bank (BoA) is now using a system called 'Equator' to facilitate short sales. I had my realtor initiate an Equator account on this sale. It is supposed to take 60 to 90 days to close the sale on Equator. I also lowered my offer by 10% -- just for the hassle. Since it's a short sale anyway, why not offer what the place is worth. So I now think my offer is high enough to pass the bank's appraisal, but low enough to be a better deal than I first had. We'll see. I may yet get this place in time for some 2010 planting.

Not so Fast There ...

... buster. It turns out that our offer on this farm, which we were assured by the listing agent was adequate to get the place, and which the seller accepted, was too low for the seller's bank. Due to a miss-communication between that bank and the seller, our offer was only enough to cover 95 percent of what the seller owes the bank. The difference is the back interest resulting from 6 months of non-payments. What we have heard is that after moving out of the place, the seller rented it for 5 months AND THE RENTERS NEVER PAID. Hence the bank didn't get paid and now they want their money. In effect, they want us to make good on those 5 months of freeloading renters. Sorry, not interested.

On the other hand, don't you think that in today's economy the bank would be happy to get 95 percent of what they are owed? But that would make too much sense. Instead, we loose the farm, the seller will be forced into bankruptcy, the bank will foreclose, the house will sit empty for months while the process happens and eventually the bank will have to sell the house at a loss of 40 to 50 percent. We live in strange times. Does this sound like bank-suicide? It does to me.

We did it!

We found a drier place to farm. It is just 3 miles up the hill from Ebey Island on the outskirts of Snohomish. Last week we made an offer and it was accepted on a .82 acre upland 'farm.' There's a house -- vintage 1940's -- that we will rent so someone who wants a share of an organic garden. We will keep half the property for our own use. That will include a small barn, chicken coop and a 1/3 acre open, gently sloping area which is now in horse pasture. We have already paid for the StarBird Farm for 2010 so we will continue through this summer there. It will take us a month or two to get the house into rent-able shape and we don't want to rush ourselves too much to get a garden in there.

Now we will have a place of our own (and an investment, we got a good deal) where we can plant fruit trees and other permanent food crops. If we decide to buy an RV after we sell our boat (38 ft long, 14 ft beam Californian trawler), we will also have a place to park that instead of using up all of our driveway.

The property also includes a large shop. For someone who could live in a three bedroom, one bath house and needs a large shop, this could be a good deal.