Here is the property -
Here is the property info -
Here are the financials -
- The property was purchased just as the housing bubble in December 2005 for $370,800.
- The first mortgage at time of purchase was made using the wonderful Option Arm with First Magnus was for $296,640.
- At the same time a second mortgage (AKA piggyback mortgage) was also made with First Magnus for $74,160.
- The property is currently for sale with a realtor for $265,000.
- The property taxes were $5556.62 for 2008.
This property was bought at the height of the bubble with some of the best bubble products of the time - zero percent down, a piggy back mortgage and and an Option ARM. The only thing missing to make this purchase a perfect bubble purchase would be a no doc loan - which it may be but we can not tell from the public records.
Since it was an Option ARM chances are that the loan is now bigger than at the time of purchase so our projected losses may be on the low side - as much as 10% to 25% under due to recasts levels. Now the property is selling for $105,800 less than the purchase price. We are going to guess that the current owner will not be making up the difference between purchase price and amount due on their mortgages. So whoever is holding these notes will be losing at least $121,700 if the property sells for the full asking price and the realtor receives the standard commission.
For those interest in purchasing the property, if they are able to put 20% down and received a 30-year fixed at today's Bankrate rate of 4.90% the monthly payments would be $1125.14. Adding in the property taxes and the monthly payments would be about $1588.19 per month - plus utilities and insurance.
For the other interested in parties that are unable to put even close to 20% down lets look at some other numbers. Using our new calculator that includes the PMI charges and the new rate, a potential new buyer is only able to put down 5% or $13,250. The monthly mortgage payment would be $1336.10, plus a PMI of $163.64, and the taxes of $463.05 totaling $1962.79. And for a buyer who puts only 3% down - the mortgage would be $1364.23, PMI now $222.78, the taxes stay at $463.05 for a total monthly payment of $2050.06.