A Real Housedebtor of OC

Having grown up and lived most of my life in OC I have come to the conclusion that the people here who seem to have money can be broken down to three types of people. The first is the person who actually has money and accumulated wealth. They may be a business owner or they may have a decent paying job. They may not have the most glamorous job but they live within their means and have saved and invested well. They don’t really ever mention money or talk much about material items. They also are the most humble and happiest people I meet. The second is the person with a very well paying job but they live paycheck to paycheck. They always have a newer car, nice high end clothes and the latest gadgets like a plasma TV. They are the one who will have the IPhone before everyone else. I know too many people who lived like this in the RE industry. The third is the person who lives beyond their means. These are the people who you would never know that they are dead broke but appear rich and are best exemplified by Irvinerenter’s post on Cultural Pathology. The third is in the worst situation today if they own a home because they no longer have the appreciation to bail them out. They are the type that always talk about money and material things. They think this will make people like them and they believe that really one day they will be rich. The only problem is they never seem to catch up or the reality is no matter how much they believe in reality it never happens.

Why do I bring this up? Well I am not one to gossip and I really hate to admit that I have watched The Real Housewives of OC but I couldn’t resist the sad facts of a person who lives beyond their means. Most of you like myself will hate to admit that you have watched the show but even if you haven’t you are probably aware of Slade Smiley. He appears to be like the third type where in the show he always talks about being rich. I shouldn’t be so modest because he brags about being rich and the show makes it seem this is what his life revolves around. He rents owns a house in Coto De Caza that has been listed for over 250 days and with only one price reduction. Maybe the reason it is listed is because Slade needs money and the appreciation spigot has been turned off. He bought the place in July of 2005 and less than a month after he bought the place he got a new second pulling out $20k and ten months later he got another new second extracting almost $100k for a total balance on the second of $225k. It would be obvious things are not going so well when the NOD was filed on 4/30/07 and how he owes his pay option lender $15k at the time. Of course if he only made his minimum payment it would be an additional $50k on top of the $1.28mil he borrowed for the first loan. So assuming only the minimum payment was made we have a total possible mortgage debt of $1.57mil. But wait there is more since he hasn’t paid his property taxes there is an additional $20k and of course a family attorney is owed about $12k and filed a lien against the home. Now the total with the commission and fees he is barely breaking even. If all those nice suits, diamond rings, high end cars and other various OC life expenses he has some serious credit card debt on top of all that.

What happened? He was one of the people who started United Title and an assistant vice president with them. It appears they sold to Land America and he should have received a decent amount for the buy out. Plus he has a highly rated show and is producing his girlfriend/fiance Jo’s singing career. Even the LA Times had recent article about how well he was doing.

The lesson is don’t buy Hummers, MBZs, big diamond rings for girls who won’t marry you and a house you can’t afford.

Oh and I almost forgot this house was a past bubble victim when it was bought back by the bank in 1995 at the trustee’s auction for $568k when the unpaid debt was $573k. The bank sold it seven months later for $540k.

77 thoughts on “A Real Housedebtor of OC

  1. sunsetbeachguy

    I would admit the Real Housewives is a guilty pleasure, until I get so disgusted I feel like throwing the TV through the window.

    I checked out the Slade link. Man some of those cycling ads are pretty old. Nothing sadder than a washed up model.

    Sweet Sweet Sweet Schadenfreude!

    Please keep us updated as this one moves to foreclosure sale.

  2. NanoWest

    Money is like a high rise apartment building………..the amount of money you have to spend is like living on a floor of the building……….always remember, there is someone that lives above you(more money) and someone that lives below you(less money)

    Always remember:

    Live on your floor and life will be great…….

    Try and live on the upper floors when you can’t afford it and life is not so great……….

    Take time to help the people on the floors below you, becasue you never know when you might be living with them…….

  3. lee in irvine

    I must admit that I watched one episode of The Real Housewives of Orange County, and afterwards I became so nauseated by the phony glamor being portrayed, I couldn’t stomach it again.

    With that said; isn’t it false advertisement to portray someone as super-wealthy on a reality program, when they’re actually one step away from bankruptcy. Actually, Slade Smiley, is the very typical Orange County resident who pretends to be rich. Ultimately, it’s all catching up to these people very quickly.

    There is a fabulous story in today’s Register about another OC (wannabe) Titan, who once lived under the second classification of graphix’s analogy, but now resides in the third classification.

    A must read: http://www.ocregister.com/ocregister/money/article_1701128.php

  4. sunsetbeachguy

    BTW, the best housing blogger handle is the poster “Real Vapid Bimbos of OC”

    That just about sums it up.

  5. awgee

    When you click on the “house in Coto de Caza” link, the ad says, “off market”. Does off market mean the house is not for sale, or does it mean something else? Jeana Keough is also presently the listing agent for Vicki’s, (a character from the show), home.

  6. Thomas

    I’ve been tracking this house as well. It’s still listed on the MLS; however, on 5/16/07 it was listed as “Hold Do Not Show.” He’s probably trying to refinance again. Vicki, one of the “Housewives” has her house listed as well. She lives on 7 Shire (MLS: S481033). Check out the pool – it’s spectacular.

  7. William Jones

    Why is it that the Irvine area seems so much more oriented toward conspicuous displays of wealth than other areas?

    Alexis de Tocqueville theorized that in democratic cultures (unlike aristocracies) people do not know where they “fit in” relative to their neighbors. Everyone is equal, but peope have always wanted to be one up on their neighbors and friends. So, people buy a lot of junk (especially clothes, jewelry, cars, and electronic toys) to “show” that they are “one up” on their neighbors.

    Why does this seem to be more prevalent in an area like Irvine? I think it is because Irvine is master-planned, and almost all housing is governed by complicated rules about what plants you can have in your front yard, what color you can paint your house, etc. There is little room for personality or originality. The only way people can show who they are is by buying junk. That’s my theory.

    The sad thing abour Irvine is that I never see people truly enjoying the beautiful parks and greenbelts there. When I am driving through the City (I live in Pasadena, but go down to the OC a lot) I see so many places that I think would be great for a picnic, or to sit under a leafy tree reading a great book…but I never see people doing those things. Why is that?

  8. Johnny Utah

    Great link to the Register article. That guy brings new meaning to the term “douchebag.”

  9. graphrix

    I always feel like my life is so much better every time I watch the show. They may or may not have money but they are all messed up in the head. I thought I had a wierd family.

  10. Lost Cause

    Do these three types fall into an equal distribution? I hope not! What about us people who don’t have money, and don’t act like we have money, and don’t care if people know it? There are plenty of us, too! OK, so maybe we don’t live in Irvine or Coto. But really, I watch these depictions of life in Orange County, and I just laugh. Who really believes that life in Orange County is actually like a show on TV? However, I have seen plenty of cases where you are right — you just can’t make this stuff up!

  11. graphrix

    There is so much more to that story too. They are known in the industry as the 6 percenters for charging the max they can per loan. They also are well known for inflated appraisals. Why else would he have to buy back $29mil in loans with more to come. That is over half the net profit of $53.2mil they had in the last two years. They also forgot to mention the sexual harassment lawsuits that some of the managers are involved in.

    I hope they do the same for Optima Funding since the guys who started it came from Quick Loan.

  12. RHOC Fan

    I read somewhere that Slade’s son (the youngest that was in the 1st season not the second) has terminal brian cancer. Not sure if it’s true or not, but you shouldn’t really judge people based upon what you watch on a “reality” TV show

  13. IrvineRenter

    Personally, I think people just like to believe they are better than everybody else. Conspicuous consumption on credit gives them this illusion, so they do it.

    The spiritual emptiness of the OC reminds me of the dwellers of the “bubble city” in Logan’s Run.

  14. Irvine Soul Brother

    William, I’m on board with your comment. The stratification in Irvine makes Inter- neighborhood competition rather moot, but heats up the potential for Intra- neighborhood competition. When everyone around you is “the same,” people look for ways to keep up with the Joneses. . .

    It got me thinking about how, wouldn’t it be great if there were a way for people whose paramount priority is to impress the neighbors to be able to “show off,” in a sense, their responsible spending. . . Like, if they started putting away at least 10% per year, and kept it that way, they would get a “P.A.W.” (Prodigious Accumulator of Wealth) sticker for their car from some financial organization. (That is a reference to a responsible saver from The Millionaire Next Door). That could work as a way to encourage financial responsibility and as a stepping stone to hopefully not being so dependent on other’s validation!

    On another note, I like how in the introduction of Slade, he said something like, “Yeah, I’ve got a Hummer, people look at me and think I’ve got it going on.” What a tool!

  15. DisplacedOCer

    I watched the show and I am not affraid to say it! lol I just enjoy recognizing the places they go to on the show. Slade in one episode busted out his Black Amex to close down a store so he had to have some money at some point. I was told by a good source he pulled in 500k last year and over 800k the year before that. And Vicki looks like she will make a boat load of money if she ever finds a seller, that is of course she didnt use it like an ATM. Which if someone could find out would be nice.

    Realestate is fun stuff for me and so is gossip so mixing the 2 is awesome. We now have some info about two of the people maybe somebody should investigate the others to compare. Sound like a good idea? I think so.

    Excellend work on the blog by the way!

  16. graphrix

    I knew I would get the RHOC fans defending the fact you can’t judge a person by a reality show. So true and that is why I said: “He appears to be like the third type where in the show he always talks about being rich.” Notice I said appear? I don’t know what he is really like but how the show makes him “appear” like an arrogant snob and what is ironic is the evidence that is public record that proves he is fake. If it is true that his son has brain cancer I wouldn’t wish that upon anyone even Slade. If you have a link that proves this I will edit my post to be more sympathetic. As that is why I asked what happened?

  17. graphrix

    As I started this post I noticed it was no longer showing up on Zip. It was there just a few days ago and was on the market for 248 days at the time. I doubt he is trying to refi since the recent NOD would pretty much kill the deal. Unless of course he turns to hard money but they wouldn’t care if it was listed or not.

  18. oc_fliptrack

    “Why is it that the Irvine area seems so much more oriented toward conspicuous displays of wealth than other areas”

    I can take that one step further and ask what is it about certain areas *within* Irvine that are so much more conspicuous display of wealth-oriented that other areas. Woodbury and Shady Canyon, off the charts. Flash, trash, t*ts, and Paris Hilton wannabes everywhere you look. Why look distinguished when you can be ultra-trendy?

    Northwood and Westpark, not so insane.

    Is it the fumes given off by new construction that makes people behave like this?

  19. oc_fliptrack

    you can’t judge a person by a reality show.

    You mean reality shows are not, like, reality? WTF?

  20. RHOC Fan

    From http://www.post-gazette.com/pg/07061/766071-238.stm

    Q: I watch “Real Housewives of Orange County” on Bravo. Last season, Slade had two sons staying with him. This season though, only his older son is shown, and his young son isn’t even mentioned. I was wondering what happened to his young son. I know the boy had some health problems (he was shown doing breathing treatments and taking medication). I was wondering if he was OK and why he isn’t talked about at all this season.

    — April, Pittsburgh

    Rob: Grayson, 5, has a serious brain tumor, and Bravo chose not to feature him in the series “out of respect to the family,” a publicist said. Given the type of show “Housewives” is (outrageous), a child with a brain tumor would certainly be a downer and perhaps a little too real.

  21. awgee

    And please, what do you mean when you write, “They are known in the industry as the 6 percenters for charging the max they can per loan.”? I can’t imagine that a borrower would pay 6% to a broker for points or loan origination fee or whatever. What does the 6% referr to? Thanks in advance.

  22. IrvineRenter

    Speaking of the “Real Vapid Bimbos of OC,” I just came from Boomers where I saw a group of women supposedly there to celebrate a toddler’s birthday. They were all dressed up in full makeup, new summer dresses and high-heeled shoes. Why would you go to a playground/children’s fun area with rides dressed like that?

    I watched one of these women back into another toddler and nearly spike him on top of his foot. If they had done that to a child of mine…

    The bits and pieces of pretentious banter I overheard was enough to make me nauseous. You could easily do a “real” reality show in places like Boomers filming real people being really pretentious. I have a hard time imagining these people are happy. When your happiness depends on putting yourself above others, and is thereby dependent upon others, it seems like a difficult way to live.

  23. Kelly

    I’m not sure if this is true or not, but I heard Slade rented the house. I wouldn’t be surprised if he took the monthly rental and walked away from the house. It will be interesting to watch.

  24. IrvineRenter

    Zip is Zip Realty.

    From Wikipedia, “A hard money loan is a specific type of financing in which a borrower receives funds based on the value of a specific parcel of real estate. Hard money loans are typically issued at much higher interest rates than conventional commercial or residential property loans and are almost never issued by a commercial bank or other deposit institution. Hard money is similar to a bridge loan which usually has similar criteria for lending as well as cost to the borrowers.”

  25. graphrix

    Thanks IR! The only thing I can add is they have very high fees and rates. They usually are not as large of a loan amount and there has to be significant equity. They are where you turn to when you have been denied everywhere else.

    Zip is short for http://www.ziprealty.com.

    The 6 percenters is on how much they make based on the loan amount. It could come from origination points, processing fees, loan app fees or on yield spread premium. YSP is paid to the one originating the loan by the bank. Regular brokers have to disclose this fee and it is calculated in the APR of the loan. If they are a direct lender or at least have a warehouse line to sell the loans directly to the bank or the one who buys the MBS package. Yes there are plenty of Quick Loan like lenders who get the 6%, not always but they start there and work there way down very little from there.

  26. awgee

    Wow! I had no idea anyone would pay 6% of the loan just to get the loan. That is amazing. Is this because they can’t get a loan for a more normal 1 point at a more normal interest rate? Are they usually low fico borrowers or creative loans? Absolutely amazing. I had no idea.

  27. SoCalWatcher

    That is sad. Poor kid. 🙁

    Too bad daddy has terminal financial cancer himself…

    I watched that show and was hooked. It is interesting at how fake and shallow these people are. Alot of money (or the appearance of it) sure makes one hollow.

    I remember one where Lauri was talking about the Benz that her boyfriend bought her and then was bragging about her 5.5carat engagement ring…. Then turns her back on her own son?

    Then, the last episode where Slade Slimey shows up with that bimbo looking chick at the BBQ… whatta tool.

    These people are unreal.

  28. Morgan

    I can confirm that his son does indeed have terminal brain cancer. My son and his son were seen by members of the same specialty practice. Dealing with that may have impacted their financial situation to a large extent.

    While I am not a fan of his from the show as a father I can’t think of anything worse to have to live through. I know I would leverage my assets to the hilt to help try to save my son.

    I agree that his lifestyle was lavish and over the top and probably heavily leveraged; but I also have to imagine that his current financial troubles probably strongly correlate to his son’s condition.

  29. graphrix

    For the most part it is the lower credit borrowers who end up getting hosed with the high fees but if they could sucker someone with higher credit they would. When I would do a subprime loan I would make more than if they were A paper but no where near what Quick Loan would make. They always took more work and time so if you broke it down on a per hour basis I really made the same.

    I also wouldn’t say that 1% fee for A paper is standard either. If the loan is a bigger amount it should be less and a smaller amount may be more. If you were to go to a direct lender such as Wells or B of A they may charge a 1% origination but you would never know what the YSP is since they don’t have to disclose it. You could break down the APR but I doubt anyone ever does.

  30. graphrix

    Morgan – I have been searching for more info on this off and on today. Since I have respect for what you are trying to do in the business you are in I will take your word for it. I agree if this is the case for his financial woes then I can understand.

  31. norcal jeff

    What goes up, must come down. And this run up was so hot for so long, it will be a very painful ride on the way down for Slade and any one else who rode this phony wave of wealth. Many of these people didn’t do much either before, or during the RE run up. It was sickening to watch, but my guilty pleasure is reading stories like this one. Just think about the $$$ he spent trying to keep Jo around…astounding.

  32. graphrix

    I have to admit I have been disturbed for most of the day by the fact that someone’s son may have a serious tumor. I have searched high and low for more info and Slade should thank me for uping his google numbers. I couldn’t find any other info other than the post gazette snipet. So I decided to search the public records to see what I could find.

    First Slade now has another NOD filed by his HOA. Second he has put very little down for every property he has owned and shortly after he has extracted equity from them. This would be before and after his son was born. He has had very little skin in the game so to say. After thinking about it for a while I thought that if it were myself in his shoes and if it meant living in a trailer in Fontana to pay for my son’s doctor bills that is what I would do. He chose to live in Coto with the high payments he has or had and continued to increase them without regard for his son’s needs. He could have chosen a more modest lifestyle to do this and it wouldn’t require living in a trailer. I wish it didn’t come to me until now but this makes me dispise him even more. I do not feel sorry for him but I feel very sorry for his son. His dad could have sacrificed just a little and things wouldn’t be the way they are but he didn’t. I am not a father but I am a son and my dad would sell everything he had and beg for change if that is what it would take to help me and I would do the same. So for the fathers out there would you chose to live in Coto or pay for your son’s doctor bills or would you live some where else so that you knew you could pay the bills?

  33. awgee

    Sorry, more questions. What is the YSP? And are you saying there are fees or charges hidden in the APR? I don’t really know what APR stands for, but I thought it had something to do with … Actually, I don’t know what it is, other than it has something to do with the interest rate one pays.

  34. No_Such_Reality

    YSP = Yield Spread Premium.

    Basically, if they get you in a higher percentage rate loan or loan type being pushed above a set percentage rate of interest, they make bonus money.

  35. No_Such_Reality

    One note of caution Graphix, if they carry insurance, what you speak of makes little difference in the childs care, it’s about how demanding you are. Given the perceived sense of entitlement most of the “housewives” cast has, I doubt that was a problem.

    Also, there is a possibility that with the child being sick has some factor as to why the properties went NOD. I suspect they’d have gone NOD anyway, but there’s a chance the illness pushed it sooner than later.

    As you said, I feel sorry for the child and the family. A seriously ill child is a very bad thing.

    I also find it bit pathetic that instead of high-lighting the good fight the family and child does with the illness, it’s swept away as if it didn’t exist by the show.

  36. anon3080

    Graphrix, Excellent article, but I was compelled to offer some basic writing tips (I am no expert by any means, but this is mostly common sense):

    1. Please do not mash up singular person with ‘they’ (plural) in the same sentence.

    2. Please use plenty of paragraph breaks – it’s easier on the eyes.

    3. Use bullet points and/or numbered items – it makes it easier for people with low attention spans (like me, and I believe we are the majority) to follow.

    Thanks again, and keep up the good work!

  37. Purple Haze

    It is very difficult to make a prediction in this market for a city like Irvine. Irvine is a very desirable city any way you slice it. I am in complete agreement with the bubble phenomenon and how people who cannot afford houses have ended up buying houses in the past. However, there are a lot of people with good credit and good salaries and savings who are stepping in to buy the bargain priced houses that are available in the current down turn. As a result the crash in the housing market is getting stabilized by the actions of the so-called “knife catchers”. I just am coming around to believe that cities like Irvine are trending towards becoming a city for the rich, more classically stated – the rich are getting richer and the poor are leaving. We will get some bargains in this environment.

    There are really two tiers of price ranges that we are talking about here. The first tier of homes is the condo/townhome market that ranges between 450k to 650k. The second tier is the high priced condos or single family homes which range from 700k to 1.5 million dollars. There is much more air in the second tier of homes, in other words these homes are disproportionately appreciated versus the first tier homes. My belief is that the second tier can see a drop in the range of 15- 20 percent. However for the first tier, the price range is more affordable, it is more easier to find prudent buyers who are willing to take a 10 percent depreciation as a bargain and buy the home for the bargain.

    The end result of this phenomenon will be that the median and average prices will come down, but more sharply for the second tier homes than for the first tier homes which are still a bargain for prudent bargain hunters with sound financial strength and willingness to move into this desirable city. So I predict that fall in prices will be to the order of 10-12 percent for the first tier and 15-20 percent for the second tier of homes as I have defined these.

  38. No_Such_Reality

    There’s only one problem with your tier 1 analogy. It’s how you find a $1,000,000 to $1,500,000 home in Southern California.

    It’s really easy, you find a SFR West of the 101/405/5 anywhere from Santa Barbara to Coronado

    Look at Redondo Beach, the whole city is million plus. As is Hermosa, Newport, Laguna, Huntington Beach, Seal Beach, Sunset Beach, most of Fountain Valley, Costa Mesa, large parts of Aliso and Mission Viejo, Dana Point, San Juan, San Celmente, Carlsbad, Oceanside, La Jolla on and on.

    It’s “premium”

    ha ha ha ha ha

  39. Bkshopr

    Prior to the year 2000 housing existed in 2 forms. Detached for $400k and up and attached for below $400K.

    A new form of hybrid “detached condos” entered the housing market. It created turmoil in pricing because there is not a price segment for this new type of homes.

    It was first introduced in an entry level West Irvine Village for $258,000 and it sold out immediately and had challenged the existence of attached housing. Why would people buy all the risk of an attached home when a completely detached could be had at the same price?

    This hybrid was so well received that it started a waiting list, lottery and pre approved frenzy. The buying panic spread quickly ignoring several of the bubble hurdles. The Nine Eleven event in 2001 and the collapse of the Dot Com, the stock market and the war in Iraq were the primary events that could have sunk the economy but the momentum of the detached condo hybrid continued to inflate prices.

    The Irvine Company must increase the hybrids’ prices in order to make room to re introduced attached housing like condos and town homes. The detached condo hybrid was bumped up to $400k – 760k in variety of locations. $200K- $450K became the new pricing strata for attached homes. The luckiest of all were the Single family fee simple homes. It automatically escalated above $760k by default (almost double its $400k in 2000)

    This phenomenon domino to all of southern California and artificially raised the comp for all resale.

    If IR’s prediction is correct that detached home prices would plummet to $450k then is it possible that 6 other inferior types of housing be shoehorned below $450k? These inferior types are listed in the order of least preferred transitory housing: stacked flats, condos, town homes, triplexes, duplexes, and detached condos. I do not think the range $200k-450k is enough of price segments for 6 transitory housing types.

  40. lendingmaestro

    That info about “the real housewives”is absolutely hilarious. I get pleasure out of knowing that. There are ao many women in OC that go after guys with fake money and then they’re suprised when it disappears”

    “..Baby, I went to the doggy clothes store to buy princess another golden-lined doggy bed but my card was declined!!”

    I feel zero remorse for these people. That does suck if his son is dying from brain cancer though.

    Dan Sadek is a tool. He’s a nice person, but still a tool. He’s another poster child of how people spend their money when there isn’t much work involved to make it.

  41. CalGal

    Slade’s house was listed as “Hold Do Not Show”; however, it just relisted as “Active.” He still lists it at $1,725,000.

  42. graphrix

    What she means is he will just give it back to the bank if he can’t sell it. In the 90s this was known by the banks as jingle mail meaning they would get keys for the homes in the mail and people just walked away.

  43. CalGal

    It was only listed as “Active” for one day, and then it went back to “Hold Do Not Show.” I have a gateway link to Coto in the MLS.

  44. jbg

    OK. How can you tell if a house has a NOD against it. I saw a property detail for this house and it doesn’t have a NOD on it anywhere. Would there be another source of info available that would state that?

  45. CalGal

    jbg – go to realtytrac dot com and search under zipcode 92679. The house, located on Meadow Wood” is listed under Pre-Forclosure. You can get more detailed information if you become a paid member of realtytrac dot com. But even if you aren’t a member, you can still figure it out that there is a NOD based on the street and house description.

    I’m not sure if this link will work, but try this:


  46. jbg

    I wonder if you can rent a house under pre-foreclosure. Plus, I also heard rumor that he doesn’t own the house, but his name is on the deed….so, I would have to say that is false.

  47. graphrix

    Another website to check notice of defaults and any real property deed is the OC recorders site http://cr.ocgov.com/grantorgrantee/index.asp

    You can search by name or by document category in which you can select notice of defaults. I keep track of the NODs and just by coincidence Slade’s name came up at the top. I probably never would have found out about it otherwise.

    So yes Slade is on title and the one with the loans but it looks more like the bank owns the home.

  48. jbg

    Could a bank repossess the house with renters in it and kick them out on the streets?

  49. No_Such_Reality

    Yes. It happens frequently. They call it rent skimming when a landlord intentially collects rent and doesn’t pay the mortgage letting it get foreclosed.

    A couple people have posted asking for help on Piggingtons and OCFliptrack about their experiences with renting as their rental gets foreclosed.

  50. CalGal

    Graphix –

    In the past Slade didn’t pay his taxes, and now his taxes are paid. If the bank takes over a property, does the bank pay the taxes? I can’t imagine that Slade paid his taxes. Do you think the Bank pays the HOA as well if those haven’t been paid. I’m just curious how this all works. Thanks.

  51. jbg

    Does anyone know if it’s legal to rent a house to someone after you have received a NOD on the property?

  52. jbg

    I think…if the foreclosure is on the primary mortgage, then it assumes the cost of unpaid taxes and any other liens on the house. If the foreclosure is on the second lien than it won’t assume the other costs.

  53. graphrix

    During the foreclosure process the owner is still responsible for taxes and HOA. Once the bank takes the property back they will pay the taxes, the HOA and any back payments. jbg is correct the second lien pretty much does nothing and if the foreclosure goes through on the first it can be completely wiped out.

    Slade just paid his property taxes on the 29th so it makes me wonder if he somehow made some money. The NOD still shows active on foreclosure.com but I do not trust their accuracy.

  54. graphrix

    Yes it is legal to rent a house in default. However the rent payments need to go to the bank. If they do not this is what is known as rent skimming which is illegal and the bank can technically can go after the owner for the money collected.

  55. awgee

    Calgal – What is a gateway link to Coto in the MLS? I think MLS stands for multiple listing service. Do you have access to the MLS? Please excuse if these questions seem elementary, but I am still in the process of learning what all of you are “talking” about.

  56. CalGal

    awgee – My realtor sets up a link for me to the Multiple Listing Service (MLS). I am interested in Coto de Caza, so he sends me all the potential listings in that area. Each day I get an email with the link showing any changes to the real estate in that area. We are BIG believers that the housing market will continue to decline, so I like to educate myself while we have the time. We are checking out neighborhoods, tracts, etc. so when the time is right to buy, we will feel 100% confident about our purchase. I also like to track the houses – what they list for, how often they decrease their price, what they sold for, etc. I’ve personally noticed that Coto has seen at least a 20% decline in the market. If we bought a house last year when all the realtors told us that the market wasn’t going down, we would have lost our 20% deposit in equity (in only a year). I believe Coto will continue to decline. Irvine and Newport Beach hold their values better than an area like Coto. I don’t believe Coto will level off until Irvine and Newport Beach decline a lot more. I don’t think they will decline as much as Coto, but they will come down. If you are interested in a particular area, contact a realtor for a gateway link. They are more than willing to do it, since they would LOVE your business. A few years ago you couldn’t get a realtor to give you the time of day – but now they are begging for your business. Let me know if you have any more questions. I have learned a lot from this blog, so hopefully I can pass some knowledge on to others.

  57. jbg

    Well, I’m fairly certain he didn’t sell the house. Would a bank be stupid enough to let him take out a 4th mortgage to pay off his taxes? He paid about $20,000 in taxes. I know he owes money to coto de caza HOA, and his mortgage is in default. Does anyone know why he would pay the taxes first? Would the government be able to take your house faster than a bank? Maybe he got some money from the show. They apparently were filming him moving out or packing up a few weeks ago. Also, I am wondering if the show would have paid any of his payments while he it was filming. Also, was wondering if they paid to have it “recently remodeled” as the description of his house states. I just can’t believe someone would live like this. Sooooo financialy irresponsible. Maybe Jo left him because she realized he had no money.

  58. graphrix

    No the government is slow and takes about five years before they would take the house. Probably the reason why he paid his taxes first are the fees and interest on them are horrible. It would be cheaper to get a loan from the mafia. I am wondering if he came into some money and paid up all his bills. It is difficult to find the accurate status on the foreclosure process. I should know if a notice of trustee sale has been filed maybe late next week. This is the next step in the foreclosure process.

  59. jbg

    That makes sense. Well, it would actually make me feel very good if he paid up all his bills, because we are actually planning on renting his house starting July 1st. One of the reasons I have been so interested in this process. Anyway, the NOD was not disclosed to us when we signed the lease…..so, as you can imagine we are trying to figure out what to do. I can’t afford to be evicted from his house in 2 months because it goes into foreclosure. I have 5 kids, and I can’t imagine how horrible that would be for all of us. Thank you for all your help and advice. It has been very helpful. We contacted Jeana today, and she played dumb…

  60. CalGal

    jbg – Do you mind moving out if he sells the house? Will it continue to be on the market while you are renting?

    Also, don’t trust anything Jeana says. She’ll tell you what you want to hear. It’s good to get as much info as possible.

  61. CalGal

    jbg- I believe the house was remodeled prior to the 1st season of the show. Plus, I don’t think the show gave him any money to remodel. He’s not a main character – he was only on the show because of Jo. I believe he recently sold his business, and he probably is getting money from the proceeds. I have no way of confirming this – but I heard it somewhere. Also, I would be skeptical about renting this house. It’s still listed on the MLS – even though it states “Hold Do Not Show.” If he has rented it, I would think Jeana would remove it from the MLS. You may want to look into this. Don’t trust Slade or Jeana – seriously. Best of luck.

  62. CalGal

    jbg – I know Jeanna, and she knows EXACTLY Slade’s position. She’s only playing dumb to protect Slade. She’s representing Slade – not you. You may want to make sure your contract states that he can’t sell the property during your lease.

  63. jbg

    If he can get the NOD lifted, then would it still be bad to go through with it? I figured if he got that all cleared up, then he obviously doesn’t want to just walk away from the house. Plus, if he does default again on his payments …does the process start from the beginning. Would it buy me a year of time? I’d rather not say what we are paying just yet, but it is comparable to other houses on the market. The problem is that his house works great for my size family. Not a lot do. Only drawback is there is no pool. Out of curiousity do you know how much he owes on the house? If it were to ever goto auction I wonder what the bidding would start at?

  64. graphrix

    jbg – He owes about $1.5mil on his first and second. If you add in back interest and the strong possibility he owes more like $1.6mil. He sold his business a while ago so you would think he would have the cash by now. Yes you would start the process all over again if he caught up and defaulted again. The process would start all over again. Would it buy you a year? Maybe but I would expect lenders to start moving faster on foreclosures very soon. They are not in the business to own homes. If it were to go to auction the starting bid would be around $1.3 for the first loan since the second essentially gets wiped out.

    My advice is to look over the verbage of the lease very carefully and maybe consider legal advice on it. It sounds like you have found the house you need so do not be afraid to pay to protect yourself. For what ever the length of the lease a new owner would have to honor it so you need to make sure there is no sales clause in there that could break the lease. If it does go back to the bank then the only good thing is when they do tell you to get out you can demand some money to help you move.

    Would I rent it myself if I were in your shoes? It sounds like you have a time frame commitment and this would make me skeptical. If you are not moving in until July I should know if the second stage of foreclosure has started. I would also ask myself would I be thinking everyday about whether this guy is going to lose his house to the bank and how would this affect me. It is your choice and like you said you should consider your family first.

  65. awgee

    CalGal – We are interested in Coto also, and we are presently leasing a home there.

    Our story; In May of 05 we sold our home on Naples Island, and moved to a leased home on the island. When our lease ran out, our landlord decided he wanted to sell his house, so we had to move again. To make lemonade out of a lemon, we decided it would be the perfect time to borrow my dad’s huge RV and travel accross the US of A for two months. We stayed at my inlaws for five or six weeks so our kids could finish the school year and then we took off. Imagine how much vacation you can do when you have no house payment, rent, taxes, insurance, cable, utilities, etc. It was phenomenal.

    We were fairly sure we were going to rent again when we got back because our plan all along was to take advantage of the crazy home prices and buy back in when prices moved down. I have lived in So Cal my whole life so I know that prices always come down, no matter what some folks like to think. And the creative financing always indicates the top. What was so amazing this cycle is just how creative and actually stupid the financing got and how ludicrous the prices got.

    Our girls attended a lovely elementary school on the island, (256 kids), but the middle school is questionable and the high schools in Long Beach are down right unacceptable. So, once again, we had a perfect opportunity and took it to make our move to South Orange County. Our choices were Turtle Rock, the port streets in NB, and Coto. We were staying in the RV park in NB when we got back and discovered we do not care for Newport. At the risk of being judgemental, the folks in Newport seem extremely materialistic, to the point of not caring about much else. Turtle Rock is closest to our church, but we could not find an acceptable rental there, so we found a 3 bd, 2 ba in Coto. We love Coto. It is peaceful. Our neighbors are very sweet and our girls have lots of friends to play with on our cul de sac. And we like the schools.

    I have to admit … I am a real estate addict. Real estate is my favorite asset class and most weekends I find an open house or two to look at to get to know all the different neighborhoods.

    Do you have kids? Do you prefer north or south Coto? Do you have a favorite neighborhood? Favorite re agent? I like Tom Doesch and Martha Burgoon. I missed the open house on the huge spec home, ($22 mil), on Violeta. Did you get to see it? I think they have reduced their asking to $19 mil. Can you imagine what their monthly negative must be on that property? I don’t think I could afford the gardener, let alone the taxes.

  66. jbg

    I think I need to talk to the bank that holds the mortgage. Even if they come back and say it has been all paid up…I won’t believe it from those two and I certainly won’t have United Titel running the title. lol! I wonder if there would be a way to assume the payments on his mortgage after he has gone into foreclosure and before it goes to auction? We’re going to move forward in a couple of different directions right now, and hopefully have some more answers by the end of the day. The problem is right now we aren’t moving in until July 1st, but moving trucks arrive at my house in 2 weeks! So…..it would be nice to have an address to give them.

  67. CalGal

    awgee – We have a lot in common. I currently rent in the Turtle Ridge area of Irvine (next to Mariners Church). We too are specifically looking in Coto, Turtle Rock and the Port Streets in Newport Beach – it’s really weird that those are your choices as well. Turtle Rock is the only area I would consider in Irvine, and the Port Streets seem less “materialistic” than other areas of NB. If you want, you can email me at a temporary email address I created and then I’ll give you my real email address once we have contact. I don’t want to list my real email address on a blog site. Email me at samohts@cox.net. We can continue the conversation from there.

  68. CalGal

    Slade’s house in Coto de Caza just leased for $5,400. It’s a 5 bedroom, 4.5 bath, 3-car garage, 4800 sq ft. house (no pool).

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