Tuesday, October 14, 2008

The Mystery House Chronicles - First Time Home Buying

I have been promising a mystery house story from my very first blog entry. It’s about time to spill the beans – we will use first letters and not full names to protect certain parties. If you recall from my previous entries this is the adventure that brought me back to real estate after having tried to interest myself in it 5 years previously...but with no success...just could not get into it...now, it's a different story...

Warning: This is going to be really long, I just can’t tell a story in 3 words…so don’t read this if you can’t read it from beginning to end. One day when you are having your coffee or you’re bored and in-between doing something more important…have a seat and let me take you into my world for a quick spin. As always…it’s the scenic route.

On my daily commute to and from the city, while others were reading the Wall Street Journal, or the Daily News, I was reading John Ghrisham, John Saul, Dean R. Koontz, Robin Cook, Sidney Sheldon, and Jeffrey Archer just to name a few of the authors that I have also favored since the 8th grade.

I had survived the Sep 11, 2000 travel market crisis, and even given myself a raise while the rest of the company grumbled because they believed the CEO’s speech of doom. “You all should consider yourselves lucky to have a job, we cannot give anyone raises this year!” he proclaimed, and combined with a very stern expression stared them all into submission.

Being a slightly different breed myself - told him to go to suck a lemon, in the quiet recesses of my mind and went out and interviewed with other agencies, and found I could make about 15k more a year at 2 other companies. When I came back to my manager and told her, all it took was 30 minutes to have them agree to match the salary so that I don’t leave and go elsewhere. Having been the only one that got a raise that year, and of course having been admonished to keep it a deep dark secret, I kept quiet - even as I had to listen day in and day out, to my fellow co-workers whine and grumble about the costs of living going up and salaries not keeping up to match.

Why can I never just get to the point without taking the reader on a scenic route I don’t know but the point I wanted to make above is that while Real Estate and the financial market made me yawn…I just survived through good old fashioned hard work and street smarts.

Enter my friend - very interested in buying a house. I ignored him as he went online and browsed different websites to find a house that he can sink his teeth...er... savings into. Finally he asked me for help. “You are the internet fiend, can you help me search?” In other words, he does not have the patience for research. I, on the other hand, while short on patience in many other departments, have a curiously long suffering patience when it comes to research.

I started to look and compare, still not more than slightly, remotely interested. Soon enough we made an appointment to view a house that for some reason really grabbed my eye. We went to see the place and I got bit by the “Real Bug”! Yes I am coining the term - it’s as close to the love bug as I can think of. The house was in ruins, the foundation sinking in 2 corners but I saw potential! I saw the back yard overlooking the Hudson River and in my minds eye, I saw that beaten down house newly restored and looking like the regal beauty it must have looked like back in the day!

No, we did not even make an offer on that house, (all work aside. the taxes in Yonkers are downright criminal) but I was hooked!

We did a few more searches and saw a lot more houses until we found one on Craigslist. A 2 family at the incredible price of 270k…hmmm sounded like a good deal. We called the broker. It was in the Morrisania area of the Bronx. (Note: This area is going through a "gentrification" phase while at the same time still falls under a special census tax bracket which means you get a little break in the mortgage rate; in short, this is apparently supposed to be the best of both worlds.)

“No, there are no photos for this place but it’s a GREAT deal" the broker stressed to us on the phone, "You just have to come and see it and just remember the outside is no big deal…just a fence and some plastic to make it a private area where the old lady of the house can sit outside in front of the house without worrying about anyone bothering her. It’s all cosmetics really, otherwise the house is a rare find, you’ll see!” Well with sky high hopes and flying balloons…we were raring to go and see this “treasure” she described!

We saw a lot of brand new houses on the block, hmm, this area seemed to be building up…very nice! Then we saw it…the only eye sore on the block.

The stairs that used to be a beautiful natural brick were painted a dark green that was peeling from all angles. The front of the house sure enough was almost hidden from view when you looked at sidewalk level by this hideous makeshift shed, made up of a green fence and plastic covering. But hey…remember…we have our rosy glasses on and we know that these are simple things that must be hiding the true beauty that is the inside of that there house…a simple cosmetic procedure or two and she’ll be shining bright!

A little belated here but a basic layout…2 units. One studio and one duplex.
~ Street level – 1 Studio, with a nice sized country kitchen and small bathroom.
~ First floor – 3 bedrooms no bathroom
~ Second floor – 3 bdrms and a bathroom (one bedroom supposed to be a kitchen)

We walk up the stairs and greet Agent B. She is all hyped up and immediately introduces us to the lady of the house. Her name was Mrs.B (hey I didn’t come up with these names and no they are not related). Mrs. B looks to be about as old as the house. She speaks fondly of her home and the many, many years she’s lived there. We look at each other and smile; nice lady, surely she must have lived here for 30 years or so.

I know I am almost 5’10 and not exactly thin, and maybe that has something to do with it, but my first impression…ye gads!…the stairs inside the hallway past the front door were SO narrow I think if I weighed one pound more I’d have to go sideways! The hallway – same thing. Add to that…something I’d never seen in my life…a cloth in the ugliest shade of burgundy you can imagine covering the entire walls of the house’s hallways. (Saving money on paint I guess but made one wonder what on earth one would find if that layer of covering was removed.)

Oh but it gets better…apparently Mrs.B had done all the cooking for the family so the only kitchen existed on the street level (read that as alternative to basement level) and the rest of the two floors, no kitchen. Ah, but then a correction, yes, there HAD been a kitchen upstairs in that last room there but when the grandson was going to college they needed that extra room for him so they covered up the gas and plumbing fixtures and converted it into a bedroom. But when we look at the room we see that ALL 4 walls have some plastic covering on them like something is hidden on all sides…so there seems to be a mystery as to which side is hiding the “kitchen” requirements.

You’d think from reading this that we were all disappointed and just went home. Oh no…we are optimists…we pride ourselves on seeing beneath the exterior…not judging a book by its cover…ok you get the idea. We saw the p-o-t-e-n-t-i-a-l.

There is one more detail that bears mentioning. The back yard was covered up too apparently and Mrs.B kept telling us to look at the top of the “shed” from the window and see what it looked like. Um…ok that did not give any indication as to what was inside the shed or what kind of mess we’d find there…I’m thinking tools, junk and spiderwebs…

The door to the shed however was locked and apparently no one could find the keys. We were told by the good lady that this was put in by her son years ago because people kept throwing things from the top of the buildings and into the backyard.

Anyway…we left in good spirits and that night I emailed Agent B and made her an offer on behalf of my friend. Things started to move along rather quickly after that. Agent B recommended a few mortgage brokers/lenders, among them Kitty Dearie of Dearie Mortgage Group.

She is the best I have to tell you…totally lives up to her name too in terms of being the sweetest person alive! Add to that an extremely efficient staff, and it's been nothing but a pleasure to deal with her.

On that note I also did some research on my own and came up with the attorney that would represent my friend. Lo and behold she happened to be in the same building as Kitty up in Riverdale! I saw some online reviews that said she was the best at her job and great at hand-holding, so you can imagine first time homebuyers…yeah we’d need some hand holding alright! So far she has lived up to her reputation…you’ll see in a bit…she is Errika Kalomiris, Esq.

Everything was going along well and we called in the inspector…this time recommended by Errika (what a bunch of helpful people I tell ya!) Dov Herman of NY Inspect a big bear of a man with a pretty sharp wit. He wasted no time and we got to inspecting the house along with him. This is where it gets interesting…

First of all, in the glaring light of day the whole house seemed to really take on an ominous appearance. At night it sort of blended in but in the daytime you could see how dark it really was inside and how small. Also how filthy it was. Ok ok…we could clean that up no problem…but a damper still…

We start on the top floor - first thing Dov notices - there is no way to the roof…he asks the ladies of the house (today there were 3 of them) and they shrug and say we don’t know. There is a locked closet next to the bathroom, he is pretty sure there might be a way to the roof through that closet but again we get a very uncooperative “Don’t know where the key is we never go in there…”

“But ma’am we need to know what is in there, that is what we are doing today, an inspection,” we insist.

To which she shakes her head and walking away mutters…”Even we don’t know everything about this house that’s why we’re getting out of here.”

Say what?!...

We turn to the first room and see that it too is locked. “Ma’am, we need to look at this room especially since this is supposed to be the kitchen. Can you open this door?”

“I don’t have the key, my granddaughter has it” we are told. This is another elderly lady that we are not sure as to her actual name or relation. “Let me call her”.

A few minutes later the key appears as if by magic. We enter the room and look around. We ask about the kitchen area and we are told it’s behind one wall. Another lady says it’s behind another wall. We are confused. More than a little bemused we decide to let it drop for now and move on to the other rooms. Then on to the floor below and finally to the street level.

As we walk down the stairs and into the street level studio apartment, we see this area too is full of a lot of junk which certainly does not add any appeal. We make our way to the backyard “shed” and lo and behold it happens to be open! I decide I am not going in there…sorry, my phobia of any creepy crawly thing with more than 4 legs just has me beat. Dov enters first and I watch from the kitchen doorway…

”WHOA!” he exclaims, “what have we here?!”

Needless to say I am intrigued…I gathered my wits about me and bugs or no bugs had to see what he was seeing.

“Wow” I breathed…“this is something else!”

It turns out that the so called shed was actually a cover for an actual cement bunker!!! Complete with a windy hallway/tunnel and a little area at the end that housed a bed covered by a blanket as well as an electric heater nearby.

Immediately our creative imaginations went into overdrive…

We are all throwing out our theories:

“You think they have people here on bread and water? Or maybe they’re making an extra $100 a month and renting out this place? This looks like it was built 3 years ago not a long time ago like they claim…what do you think is going on here?! This thing is not in the plan of the house this can be a problem…” and on and on we went.

You want to see what we saw?

Here you go:

Image and video hosting by TinyPic

Image and video hosting by TinyPic

Image and video hosting by TinyPic

We walked back outside of the bunker and notice a small run down bathroom wedged in a tight space on the outside. It was obviously not a working bathroom and yes there was some kind of pan on the floor…

“Ugh I don’t think you need me to tell you what THAT thing is used for…actually I don’t even want to know!” one of us remarks.

We start to see some colorful looking characters walking in and out of the house by that time. See, turns out Agent B never told the lady of the house we are going to do an official inspection she thought we’d just drop by for a few minutes to take another look at the house on the outside. According to Agent B there was never anyone there but Mrs.B and her daughter and granddaughter every time she went, but after we told her the people we saw coming and going she realized why she’d been told she had to give 24 hour notice before she came by every time. To hide whatever was going on which I still don’t even want to speculate on. Suffice it to say, things were looking mighty shady…

We went outside to where the real makeshift shed had been built at the front of the stairs to allow Mrs. B some private outside time and as we continued speculating about the discovery we just made - I warned the other three just in time, and we all jumped aside as right over our heads, where you have the porch for the floor above street level, the family pet apparently found his favorite corner and let loose both number 1 and number 2.

“That does it for me…I’m out of here!” Dov jokes. We went back inside nice and quick.

I could not resist asking Mrs. B…“How long have you lived here?”

“8 years dear…” I’m amazed…according to Agent B and even on our last visit she had talked like she’d raised her entire brood in that house.

“When was that shed put up out there?” I have to ask again…

“Oh that was before we got here dear”.

Huh?! Last time we were here she told us it was put in by her son to cover the backyard, this time when she realized we had seen what was there she changed her story…I did not push...better to leave it alone...

By the time we left we had already made up our minds. The rosy glasses had turned a very smoky hue - downright dark. Luckily we had yet to sign the contract…

Errika calls back the next day and drops another bombshell. Apparently the seller’s attorney had been operating under fake pretenses. He had been disbarred since 1987 and not only that, was working under the name of his deceased partner! (Told you she’s good!)

The common refrain we have heard from all professionals involved has been…

“I have been in this business for (15, 20 etc) years and have never seen a situation like this!”

What can I say…this is my first adventure in real estate…there are a LOT of lessons to be learned from this and I may post those another time if I have not lost your interest yet…

Somewhere in the middle of all this, I had my epiphany - I am going to become a real estate agent! I had seen the good, the bad and the ugly for the most part in this deal that went sour and yet it only served to whet my appetite and further entice me...

Have to quote Mr.Watson...

"In this business, if Real Estate was just Real Estate was just Real Estate...I would have been bored to tears and doing something else by now...the thing that keeps it interesting is that no two deals are alike...something always happens differently and I just love to see how each one will turn out."

I second the motion.

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