tv Bob Massi Is the Property Man FOX News October 31, 2015 9:00am-9:31am PDT
debate. fox business has a scoring opportunity. neil, maria and crew. let's show how to moderate a fair, balanced debate with real money questions. somebody has to. have a safe halloween. be careful. for 32 years, i've bn practicing law and living in las vegas. i help people with all sorts of real-estate problems, from trying to save their homes to closing major deals. eight years ago, 6,000 people a month moved here, looking for employment and affordable homes. little did anyone know that we would become ground zero for the american real-estate crisis. now, it's a different story. the american dream is back. we're gonna meet real people who faced the same problems as millions across america, and we'll dive deep into a city on the rebound because las vegas was a microcosm of america, and now vegas is back. [ woman vocalizing ]
thanks for joining us. in a few minutes, we're gonna take you inside two truly unbelievable homes. but first, i want to introduce you to a couple stuck in a property nightmare. >> which one are you looking for, jacob? >> let me tell you the story of mark and yessenia. >> go like this. >> they're a typical young couple. they're trying to raise a family and provide for their children. >> we've been married for seven years. currently, i'm a firefighter with the city of henderson fire department. yessenia is a stay-at-home mom right now with our three boys and running the household for us. >> we bought our first home in 2006. after we got married, we started our family and decided we needed to get into a bigger home. >> throw it! >> we were running out of room, and, at the time, the market wasn't the best for us to sell the house that we were in, so we decided to use it as a rental property. >> it was about three years of living into that house, and i lost my job. >> once we realized my job alone wasn't gonna handle both the mortgages on the properties, we
went to the bank to see if we could get a loan remodification or whatever processes they had at the time. >> they contacted the lenders. they wanted to try to save their homes. people who, their whole life, had great credit ratings -- they were being told, "the only way to save your home is go late on payments." >> we were pretty much told that we were making our payments on time, so there was nothing they could do for us, but if we went delinquent and stopped paying, after six months, they'd reassess the situation and go from there, but they still couldn't give us a guarantee that there'd be something they could do to help us. >> so many good people that bought the homes in good faith in '06 are now being asked to ruin their credit in the hopes -- only the hopes -- of saving their home. so, what did they do? mark and yessenia contacted a lawyer, looking and hoping for help. >> we were told it was in our best interest to file a chapter 7 bankruptcy, to surrender both properties, and begin to re-establish our credit and our family.
>> they filed a chapter 7 bankruptcy. they thought at that time that once a bankruptcy was over that they could move on with their life and eventually buy a home. so they moved in to a rental property and spent three years saving money and repairing their credit before trying to start over. >> look, cruz. want to play? we figured that houses would be sold and would be out of our name and we would wait our appropriate amount of time before we started searching for another house. >> but, suddenly, they discovered a problem. the home they gave up in the bankruptcy three years ago was never actually sold by the bank. >> the title of the house lists mark as the property owner. when i contacted bank of america, they said that bank of america rescinded on the foreclosure process. >> the title to the property was never taken out of their name. it's what we call a zombie foreclosure or zombie title. in other words, the lender, to this day, still has not foreclosed on that property, and
what that means for mark and yessenia -- they cannot buy a property, a new home, to house their family until that lender decides to foreclose on that property, and they find themselves stuck in time. >> we don't technically owe the note on the home, and bofa doesn't technically have the note, but it's still -- the title is still in mark's name. >> for every problem, there's a solution. we're gonna sit down and listen to their story, and i'm gonna give them some resolution to get them out of this mess so they can rebuild their dream. hey! >> [ chuckles ] >> what are you doing back there? hey, mark. >> hey, bob. good to see you. >> how are you, yessenia? >> hello. >> hey, honey. what did it make you feel like when they told you that you had to go delinquent, if you will, on your payments in order to even be considered? >> it was a hard pill to swallow, 'cause we had taken pride in, you know, providing for our family and doing all the right things and establishing our credit and not walking away
from a liability and our responsibilities. >> we wanted to stay in that home. we loved that house. >> so, at some point, you approached a bankruptcy lawyer. >> he had told us that this was going to give us a fresh start, that we were going to be able to have those properties out of our names and the debt out of our name and we would be able to, in a few years, as long as we tried to re-establish our credit and save some money for a down payment, we'd be able to buy a house again. it's been three years that this house has supposedly not been our responsibility. now, three years later, we're having to deal with trying to figure out what to do. >> this problem can be solved. but first i needed to see this property for myself. so, here we are at 9498. this is the property you thought was surrendered, and this is the property that's still in your name, right? >> yes. >> right. >> all right. let's go in. let's take a look. if you would have realized that
it was still in his name, i'm assuming the condition of the house you would have changed and tried to rent it out again. >> yeah, absolutely. we wouldn't have let any of this happen, and we would have hopefully had somebody in here that would have taken care of the house. at this point, we're willing to do almost anything to just get the house sold. >> we talked to the gentleman from the collection agency that purchased the loan. we asked him, "when are you gonna foreclose on the property?" he said, "we can't. we're just a collection agency. i don't even know where we're gonna go from here." >> do you have any motivation just to sort of fix it up and say, "hey, lender, until you take it, i'm gonna rent my house out and make some money"? >> we've thought about it a great deal -- spend 5 or 6 grand as an investment, throw it back in here, and throw a renter in here till someone says, "leave." >> now that i've seen the property, the first thing that comes to my mind is the short sale. by definition, a short sale is where you sell it for less than what the debt is. there is no debt. i think that puts you in a huge advantage because now, since the lender has done nothing for
three years, you may have a trump card to get rid of this home and get it out of your name. the other thing is i really still believe that either through the bankruptcy court, which takes a little more time, or just deeding the property back to the lender or the servicer of the loan, is definitely an alternative. what we want to try to do is keep it out of court, because, number one, it's time-consuming. you don't have to spend any money. so, i think we're gonna approach this in a very practical way. what's the quickest way to get this nightmare behind you so you can start rebuilding your dream, own a home in another year, and then move on with your life? so, will they be able to escape from zombie foreclosure? we're gonna follow mark and yessenia's story, and in a few weeks, i'll check in with them and i'll let you know how they're doing. next, i'm gonna show you two of the hottest properties in las vegas. how 'bout this -- basketball court, wine cellar? believe it or not, they're right here in las vegas. [ woman vocalizing ] ♪
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♪ >> welcome back. i'm bob massi, the property man. when the real-estate market crashed, it took everything with it, from studio apartments to multimillion-dollar mansions. but the american dream is back, and real estate is hot again. at the end of the program, we've got some vital tips that you need to know if you're jumping back in the market. but first... if you're talking high-end real estate in las vegas, well, let me tell you, you're talking for florence shapiro and ivan sher. this duo is responsible for listing some of the most unbelievable homes around, and they offered to show us two very different but equally stunning properties. this property has nearly 16,000 square feet under the roof. listing price -- $11 million. to the left here is actually, like, an indoor/outdoor pond. >> yeah. it's a koi pond, and it goes right into the house.
so, you have the sound of water wherever you are in this house. >> and immediate meditation, ivan -- you know, that warm feeling, home feeling. and then, as we're walking in to the house, this is a very, very unique door. >> the home was obviously custom-built for the owners. at the very end of the design and development and creation project, the door was unveiled to them, and, as you can see, it epitomizes the home. >> i mean, look at this. look at this chandelier. >> incredible -- absolutely incredible. >> there's a peace about this property, ivan, that when you walk in, it doesn't overwhelm you. >> you're immediately struck by the architecture. >> yeah. >> you look at it, and you just -- you're inspired. then you walk through the home, and you feel the light. you feel the air. you feel the zen of what it has to offer. and you come out to the backyard, and the backyard kind of cascades over. >> the nice thing about this is it opens up to the family room, and you've got the fireplace
that looks like it's outside, and the main thing in here is the glass ceilings, because the light comes in and it's never right on you. it's, like, very gentle, very soft. >> this is a very functional type of kitchen, where it's not overwhelming... >> no. >> ...but yet you still have the openness, where you have the dining area, you have the -- i'm sure they spend all their time -- like all families, right? -- right in this area here. >> absolutely. absolutely. and the nice thing is look at the views you have. >> yes. >> that's an architect that thought about it. >> by the way, enjoy playing a little basketball? this house has you covered. okay. so, there are such things as, like, basketball courts, you know, like backyard courts -- a little bit of cement. however... >> for their family, what they decided to do was what could they do to add some value for the kids? >> what an amenity and what a selling point for you to have. ♪
property number 2 is like slipping in to a little piece of europe right here in las vegas. [ laughs ] this is getting to be torturous. [ laughter ] oh, my god. this 5-bedroom, 5-bath home has nearly 11,000 square feet of living area, and it's listed only for $8.5 million. the custom and imported finish throughout this breathtaking estate are second to none. >> the floor that you see is reclaimed from europe. the terra cotta that you'll be walking on was brought from europe. >> when i'm walking, the first thing i notice is the ceiling. >> all of the detail that you see on the ceilings were handpainted on canvas. >> and then it was stretched in here, and the beauty is the way they've arched the ceiling so you get that impression when you walk in. >> and this is in an area called southern highlands. >> right. >> that's correct. >> so, now we're going out towards the swimming pool. you walk in to certain homes that are this large, and sometimes there isn't that feeling of warmth.
this feels like a home. it feels like it's lived in. as large as it is and as beautiful, it feels like a place you could bring the family, bring the kids, bring the grandkids, and have a great time. >> that's right. >> look at this kitchen. they have this completely open space here where people could sit and talk, and you have the view out here. and then i'm looking out here. there's even a barbecue area where they can go out. >> yes. >> what some people do incorrectly when they build a home like this is they go for the european feel but they make it heavy. that's not what's timeless, and this home is timeless. >> it's interesting you say that, because i notice that, literally, from room to room, there's different woods, so it's not, like, overbearing, where you get all this dark wood and the house gets dark. like, you look at this area over here, this cupboard area. it's not like something that's so heavy-looking that it overwhelms the room. so now we're on the second floor of this home. by the way, it has an elevator, correct? >> yes, it does. >> now, explain this hallway. >> basically, you have at the end a trompe l'oeil that looks
like a library, and then you have these antique mirrors that are on the side on the walls that gives that feeling of openness. >> and then you have this beautiful view out here of -- >> you got to suffer through these views. >> yeah, that's the problem. this is tough. puts a lot of pressure on you at night to look at the view, looking out towards the strip and the golf course. >> you'll notice that there's an indoor/outdoor component because it's vegas. >> very interesting. >> because of the weather, because of the climate, the people really use the space. >> so, now we're gonna go down to what appears to be the basement. now, this is not your average basement, with a soundproof theater, of course, a gameroom, wine cellar -- a little vino -- and a private office. >> this is the gameroom. this is where you have fun. >> look at this. oh, a nice pool wine -- every kind of wine you could imagine. >> that's right. >> and now we go into surely what my grandchildren would love -- the theater. i mean, here we go. >> you've got al the warmth and the nostalgia and the european
feel, but then you still don't miss on the technology. >> yeah, there's nothing missing in this room. >> yeah. >> yeah. >> congratulations on having this. you're representing them well, believe me. >> thank you. >> thank you so much. >> thank you very much for the opportunity. >> thank you. >> thank you. >> up next, you hear a lot about crowd funding nowadays. but could that concept actually work in real estate? meet a man who says it already is. [ woman vocalizing ] ♪ ♪ (singing) you wouldn't haul a load without checking your clearance. so why would you invest without checking brokercheck? check your broker with brokercheck.
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>> welcome back. i'm bob massi, the property man. crowdfunding means raising money for a project by having a lot of different people invest. well, the internet has enabled all kinds of things to be funded this way, from new inventions to independent movies. but now builders have turned to crowdfunding, turning people into overnight real-estate investors. is this a good thing, though?
>> you've seen it on indiegogo, kickstarter, sites like that, where there's been donation-based crowdfunding, charitable contributions for causes, but it's now expanded. >> normally, real-estate investments are limited to people who are writing checks of $100,000 or more. we can take a deal, put it online, allow people to invest for 5,000 bucks. giving an individual the chance for a few thousand bucks to own a piece of commercial real estate -- it's really empowering. >> it's growing by leaps and bounds. in the past year, over 100 companies have popped up. >> realty mogul, realtyshares, crowdstreet -- more and more real-estate crowdfunding websites are popping up every day. the websites say that it's bringing democracy -- democracy! -- to real-estate investing, enabling everyday people to invest in major building projects. >> there's been a lot of frustration with wall street and banks, that they're not lending to the right places for growth, and so the thought is that using technology to directly connect investors and borrowers -- it can create a more efficient process that i think will threaten the traditional
centralized infrastructure. >> but is it really that simple? for the moment, most real-estate crowdfunding is only open to so-called accredited investors. what does that mean? in short, got to have a lot of money. >> an accredited investor is a term defined by the s.e.c. it means an investor who has a net worth of $1 million or more or income of $200,000. >> but sometimes it is possible for the little guy to still participate. fundrise recently celebrated the opening of their first ever crowdfunded project. >> we were the first crowdfunding platform and the only, as well, to offer an investment to non-accredited investors. the first project, at 1351 h street northeast in washington, d.c., we bought a 5,000-square-foot auto garage, rehabbed it, and leased it to famous local chef -- opened a concept called maketto. so, it's a fusion kind of asian night market, retail store in the front, coffee shop upstairs. >> the market opened in washington, d.c., after its construction was funded by 375 individual investors --
what a country we live in -- who put up between $100 and $10,000 each. >> they could invest in that project for as little as 100 bucks, which most people have never bought real estate at all, and the idea that that entry point is successful is really powerful. >> and this is big business. the crowdfunding website realty mogul has just invested -- listen to this -- more than $50 million from 16,000 accredited investors spread over 180 properties across this great country. >> in most cases, they invest themselves into the projects. they open it up to, at this point, only the accredited investor, with as little as $5,000. >> we recently raised $5 million for 3 world trade center. it really goes to show where crowdfunding has come since we started. you have some of the most institutional, well-respected developers in the world using it, and you have places like 3 world trade center, which are iconic to everybody. >> what risk does that investor have? >> same risk as they would if they were one person buying a piece of investment property. it's still a risky venture. there's no guarantees.
>> the way the payback works is, first, the bank gets paid. then fundrise investors get in between 12% to 16% a year, and then the developer gets their upside, so the developer doesn't get any money back until we're fully paid, and we like to have that level of protection for individual investors who are often just learning the process. >> so, you can invest as little as $5,000 and, say, for 12 to 18 months, get a return of 10% to 14% on your money, which you can't at the bank. >> very shortly, it'll be something that's possible for everybody, and i think that's when you're gonna see a big shift that people can actually participate in this, from the smallest levels, all over the country. >> crowdfunding, zombie foreclosure, short sale -- well, listen, we've got a lot of information for you that you can't afford to miss. stick around. [ woman vocalizing ]
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♪ >> welcome back. i'm bob massi, the property man. time now for the massi memo. you know, we covered a lot of ground today, and we met mark and yessenia, a couple stuck in a zombie foreclosure. but what is a zombie? remember, it's a property vacated by the homeowner, thinking the foreclosure was going to happen, and it never did. so, in effect, it's dead and buried. what could you do once you find out? immediately contact the servicer of your loan about the zombie. many times, these people are so far removed, you got to wake them up from the dead. if you get no response from the servicer, contact the consumer financial protection bureau and
file a complaint. and, finally, if there's no action at all, please get a tough, competent real-estate attorney to bring the lender back to life. we also heard about crowdfunding. now, this allows people to be involved in causes and investments they never dreamed of, including the world trade center and real-estate ventures and businesses. let me break down the different types of crowdfunding. donation -- a crowd gives money because they want to support a cause. or reward-based crowdfunding -- individuals form a crowd. they give money to businesses in exchange for some type of reward. and then you have the equity crowdfunding. members of the crowd -- they become owners of a business, and certain type of financial guidelines must be met, including, by the way, real estate -- not just businesses but real estate, also. and then you have debt crowdfunding. the company solicits from their crowd money and treats it as a loan, and you get interest back. well, that's it for today. be sure to send me your questions or property stories at...