**Laguna Niguel Real Estate´s last blog post..Dana Point 2009 Doheny Blues Festival…

Yes, some people were mislead by lenders, agents, and even family. But the vast majority of people I’ve had exposure to went into the transaction willingly, on their own accord.

I can’t begin to tell you how many people asked me (and continue to ask), “What’s going to happen to home prices?” The simple fact is, I do not know. Know one does.

Oh, we can look at trends, and analyze stats until we’re blue in the face, but NO ONE can predict the future with any certainty.

I told people repeatedly that there was NO WAY the ridiculous appreciation rates of 2005/2006 could continue. I wrote a post in November — of 2005 — saying there was no way home prices could continue to rise like they were.

That doesn’t make me smart, or able to see the future. It just means I can do very simple math.

I’ve been telling my two teenagers for years to accept personal responsibility. Sometimes they get it, sometimes not. But I think they will by the time they leave the nest.

Maybe I’m misunderstanding something here, but how is this anyone’s fault, except possibly the buyers? The entities you mentioned above did nothing other than help the buyer purchase the house they wanted to buy. The fact that the buyer has had a change of heart over the past two years certainly shouldn’t reflect poorly on any of those.

Though I have no affiliation with the world of real estate, it really bothers me when people blame lenders, realtors, etc. for buyer’s woes, simply because they helped the buyers purchase the house they wanted to buy, at a price they were willing to pay, and at terms they agreed to.

Unless any of the above willfully misled the buyers (and I’ve heard of precious few instances where that was actually the case), the buyers have no one to blame but themselves. In the case here, it sounds like it’s just an unfortunate situation, since the buyers don’t like where they live, but they can’t sell their house because of the poor economy. It sounds like the buyers in this situation are still capable of paying their mortgage, which is more than can be said for many buyers who apparently were living in some sort of dream world where home values always increase exponentially, and variable interest rates never increase.

Though this isn’t an example of such, I’m really tired of hearing sob stories about home buyers that bought a house they couldn’t afford, at a variable rate they knew would increase, in a market that was clearly primed to draw back at some point, and now they’ve been foreclosed on, and they’re blaming everyone but themselves. They rolled the dice and they lost, and now they shouldn’t have to lie in the bed they made? For some reason, most people agree with this sentiment, and I just don’t understand it.

Laguna Niguel Real Estate

“The builder we bought from still has approximately 30 homes to build in our subdivision, Basically the construction stopped as soon as we moved in.”

What appears to have happened is they bought the top of the market and now are upside down in their house. Given that they bought new construction, this could be a calamity of bad decisions.

I’ve spoke to many people in my area that are in the same position. Not only did the builder screw them, but also the appraiser, Mortgage Brokers, Title Company and Realtors. They are all equally guilty of putting good people in bad situations. We have all seen and read about this situation many times in the past couple of years.

Trust me, I have a great deal of compassion for all of these people and feel horrible when I talk to them and don’t have a solution to bail them out.

The real question is who is accountable, and who should bail out who? Who should go to the people and have to make it right? The lender that purchased their loan or the people that facilitated and encouraged them to make a bad decision?

There needs to be a lemon law for Real Estate I suppose. They do it in other industries, why not in Real Estate?

Kris Berg wrote a great article on her frustration with short sales, I hope that every Asset Manager at every Servicer reads it. Different subject though that maybe I’ll editorialize on another blog post.

I could write volumes about this subject.

Matt – the question mentioned walking away. I’m not saying it’s a good option, but it is an option (that more and more people are doing every day — not that that makes it right).

For some people just staying where they are isn’t an option.

As far as leaving a lender hanging between a foreclosure and a short sale, I sure wish some lenders would see the difference and quit foreclosing on homes that have viable short-sale offers on them. Happened to one of our clients TODAY. Lender promised postponing foreclosure to determine if they wanted to accept a short sale offer. Reneged on that promise and foreclosed — at thousands LESS than they would have received in the short sale.

They need to stay where they are. To walk away from a home and leave the lender hanging is wrong.

At some point Lenders may require a letter of explanation as to why the foreclosure happened. The explanation alone might disqualify them from getting a new loan.