Bakersfield home prices down 10.9% YOY and a David Crisp Sister in Law report

Bakersfield home prices continue their decline.

Here are the latest numbers for some selected areas from the CAR:

• Bakersfield down -10.9%
• Tehachapi down -17.9%
• Kern County down -11.8%
• Visalia down -11.6%

Does everyone recall the days when real estate only went up?!?!?!?

From KGET.com we get a Crisp update. Be sure to watch the video. This report focuses on his sister in law and her involvement in the "shenanigans":

Megan Balod, 29, is Crisp’s sister-in-law. A year ago, she went on a shopping spree in southwest Bakersfield and bought a house on Walderi Street for $380,000, as well as a house for $920,000 on Covent Garden Court, and a home on Vista Bonita for $549,000.

Then, in one week last May, she bought two houses, one for $795,000 and another for $475,000. In all, records show she borrowed more than $3 million that spring.

That's more than $15,000 a month in interest payments for Balod, who answers the phones at her father's CPA business.

She's the only borrower listed on the loans; even her husband has been taken off the deeds. Balod's sister is married to Crisp, so one might think she'd get a good deal when she goes house shopping.

Kern NOD's up 190.2% YOY, Trustee Sales up over 2000% YOY

From DQNews.com:

La Jolla, CA.--Lenders sent California homeowners the highest number of mortgage default notices in over a decade last quarter, the result of flat or falling prices, anemic sales and a market struggling with the excesses of the 2004-2005 home buying frenzy, a real estate information service reported.

Lenders filed 53,943 Notices of Default (NoDs) during the April-through-June period. That was up 15.4 percent from 46,760 for the previous quarter, and up 158.0 percent from 20,909 for second-quarter 2006, according to DataQuick Information Systems of La Jolla.

Last quarter's default level was the highest since 54,045 NoDs were recorded statewide in fourth-quarter 1996. Defaults peaked in first-quarter 1996 at 61,541. A low of 12,417 was reached in third-quarter 2004. An average of 34,172 NoDs have been filed quarterly since 1992, when DataQuick?s NoD statistics begin.

Trustees Deeds recorded, or the actual loss of a home to foreclosure, totaled 17,408 during the second quarter. That is the highest number in DataQuick?s statistics, which go back to 1988. That was up 57.8 percent from 11,032 for the previous quarter, and up 799.2 percent from 1,936 for last year?s second quarter. The prior peak of foreclosure sales was 15,418 in third-quarter 1996, the low was 637 in the second quarter of 2005.


(Too many news stories I don't want to miss, back to vacation)

Crisp & Cole lease to buy program

Interrupting my vacation to post some big stories in the last few days:


From the Bakersfield Californian:

Stunned by defaults

Residents who thought they were in Crisp & Cole lease-to-buy program stunned to find out houses in default

BY GRETCHEN WENNER, VANESSA GREGORY AND STEVEN MAYER,

They write rent checks each month to Crisp & Cole Real Estate

Some thought the payments were bringing them closer to homeownership through a lease-to-buy program.

Instead, the homes are in default -- at least a dozen of them -- along with more than 50 other Crisp-related properties in Bakersfield.

Several residents of North Country Meadows, a new enclave near 7th Standard Road and Airport Drive, weren't aware they were living in defaulted homes until reporters knocked on doors Thursday.

"We had no idea until yesterday," said Richard Black on Friday. Black and his wife, Shawna, moved into their 529 Fern Valley Way rental six months ago believing they could buy the home.

Since the beginning of the year, however, current and former employees, family members, business associates and customers have defaulted on at least 67 homes, mostly in southwest Bakersfield, Californian research of public and industry records has found.

More than $34 million in primary loans and another $7.3 million in secondary loans are at risk of failure.

From Eyewitness News:

More trouble for the once, high-profile Bakersfield realtor, David Crisp.Eyewitness News has learned, for the first time, a home belonging to either Crisp or his wife Jennifer, is poised to go on the auction block.

A "notice of trustee's sale," which is the final warning to a homeowner before a
house goes up for bid in front of City Hall, was filed Thursday on a home on
Lanai Avenue in northwest Bakersfield.According to the Kern County Recorder's
office, the home is owned by Jennifer Crisp.

Documents show an outstanding loan for $400,000. Unless paid soon, the home is set for auction early next month.The Crisps can't sell the home themselves because of an outstanding I.R.S. lien amounting to over $111,000.

Now back to my vacation.

Vacation

Be back in a couple of weeks.

Carl Cole does a short sale on his property

From Eyewitness news.com

Meantime, we have learned, Crisp's former partner, Carl Cole, took a big loss on a home he purchased in January of last year. The home, on Durand Oak Court in the Oaks, was bought for $620,000. Just last month, it sold as a short sale, for just $405,000 meaning the lender took a loss of $215,000.

This news just one month after word of an audit investigation by the state of the former real estate duo crisp and cole.

KGET visits Crisp residence

First, the news on the home in Seven Oaks defaulting is old news, so I am not sure why they are covering now. However, they also give us an interview with Jennifer Crisp and an update on the commerical building on Stockdale.

From KGET.com website

17News has tried repeatedly to speak to Crisp. This afternoon, when Reporter Kiyoshi Tomono went to his house, Crisp's wife, Jennifer, said her husband was at work when 17 News knocked on her door Wednesday.

"You are saying bad things about my husband," Jennifer Crisp said. "I don't want to talk about it."

On Friday, county records show Crisp took out a fifth mortgage on a 10,000-square-foot office building at 8800 Stockdale Highway. He borrowed $650,000 against the building.

Crisp has taken out four other deeds—one for $1.375 million on April 12, another for $505,000 on April 13, a third for $200,000 on April 25, and a fourth for $48,000 that same day. That means he's taken $2.78 million in loans on the Stockdale Highway property. Crisp bought the building for $2.5 million in April, and property prices in Kern County have continued to decline over the last year.

Local market update

Two local market updates.

The first one is from a post by ichabod:

Thought you might like to know.

1.) Current REALTORS who have MLS access now number 1,993. I remember late last year that number being almost 3,000.

2.) Offices are closing. There are only two Help-U-Sell offices in Bakersfield, and one in Delano (one agent, 4 listings). There are no more Assist 2 Sell offices anymore.

The second update is from an auction by thefunsucker:

Here's some info on a Williams and Williams aution I attended this morning...

The house is 3,154 sf and located in Shilo Estates, 2444 Ollie Ct. The house has been on the market for about 2 yrs was was on the market due to a relo. Was purchase on 8-15-03 for 327k and then sold to Land America One Stop (something to do with the relo) for 602k on 2-1-07. It sold at auction for a whopping $106 a Sf for a grand total of 335k, quite the loss.

There were about 20 folks onsite but only 2 bidders. What was funny were all the high power RE agents in their 7 series bimmers watching the market crumble before them. Wonder why they weret't bidding???This was the 4th home in Shilo to go on the auction block and I don't believe any of them fetched more than 150 a foot.

Great news for the comps bad news for all those poor souls trying to sell....no pity!

Bear Stearns funds nearly worthless

From Yahoo news:

Weeks after the meltdown of two prominent Bear Stearns Cos. (BSC) hedge funds that bet heavily on the market for risky home loans, the brokerage has told the funds' investors that the portfolios' assets are almost worthless, according to people familiar with the matter.

The assets in Bear's more levered fund, the High-Grade Structured Credit Strategies Enhanced Leverage Fund, are worth virtually nothing, according to people familiar with the matter. The assets in the other larger, less-levered fund are worth roughly 9% of the value since the end of April, these people said. The April valuations weren't immediately available but in March, before their sharp losses, the enhanced leverage fund had $638 million in investor money, while the other fund had $925 million.

The two funds have been in the spotlight for weeks after suffering heavy losses in the subprime market. Late last month, Bear helped stabilize the less- levered fund with a $1.6 billion secured loan; the enhanced fund began trying to unwind its remaining $1.1 billion in debt.

Bear disclosed this information to investors earlier Tuesday and is expected to make a statement Tuesday evening, these people said. A spokeswoman for Bear didn't return calls for comment.

These losses, which took more than two weeks to calculate because of the fluctuating values in the market for risky, or subprime, mortgage securities, came amid another tumultuous day for the broader mortgage market. One particularly wobbly slice of the market tracked by a closely watched index called the ABX fell to an all-time low of 44.

Full Spectrum Bakersfield Offices

This blogger has received the following via an email:

"I keep up daily with your blog and wanted to let you know that Full Spectrum
Lending (Country Wide's sub-prime company) has just laid off their entire staff
in Bakersfield. I hope this is helpful to you, keep up the good work."

A phone message at the offices(661)654-8140 states they have consolidated operations effective July 16, 2007.

Southland home sales slowest since 1993

From DQ News.com:

La Jolla,CA----Southern California's real estate market slowed to its lowest sales pace in 14 years last month, led by steep sales drop-offs in the Inland Empire and other affordable markets, a real estate information service reported.

Last month's sales were the slowest for any June since 1993, when 19,947 homes sold, the lowest for any June in DataQuick's statistics, which go back to 1988. The strongest June was in 2005, when 40,156 homes sold. The June sales average is 29,041.

Bakersfield Sotheby's partnership crumbles

From today's print version of the Bakersfield Californian we get an update on the local Sotheby's franchise.

First, why do we need a Sotheby's in Bakersfield?

Second, this local real estate company, like so many others, started during the boom or near the end of the boom. These people really thought this boom would continue forever? They have leased or purchased space at peak prices. Look at the whole SW and NW corridors and all the new offices dedicated to REIC membership.

The next area of pain will be in the commercial real estate space in this town - Guaranteed! Most of the new space under construction or just completed is dedicated to REIC members and as they slowly meet the same fate, that space will be empty.

From to the Californian:

Mike Ryan, co-owner of Bakersfield's Sotheby's affiliate, resigned from the luxury real estate firm last week, according to Ryan and former partner Cissy Johns.

The partners began operating under the real estate banner...in January (2007).

The resignation surprised Johns.

"I wish he hadn't (left), and that he hadn't felt the need to do so, but we're facing a tough time in our market lately," Johns said.

Fresno homeowners move out and mosquito's move in

Mosquitoes move in

Disease-prone pests thrive in the stagnant pool water of empty homes in Fresno-Clovis area.

By Farin Montañez / The Fresno Bee

Rotten leaves and insect corpses float on pea-soup colored water in a Mickey Mouse-shaped pool at an abandoned house in west-central Fresno.

It's a breeding ground for mosquitoes.

Ever since a neighbor complained several months ago, mosquito abatement district workers have been doing what they can to get rid of the bugs.

They've sprayed insecticide three times. They've dumped in about a dozen guppylike fish to eat the mosquitoes -- but the fish just can't keep up.

It's just one of 827 swimming pools in Fresno and Clovis that district workers have treated this year -- far more than in any recent year, officials say. District officials are monitoring 1,000 more pools, and they say there are hundreds more they don't even know about.

"This isn't even the worst one," Roy Benavides, an area supervisor with the Fresno Mosquito and Vector Control District, said of the Lafayette Avenue pool -- just a quarter-mile from Slater Elementary School.

"It's a nice neighborhood. You would never guess a pool like this would be here."

A proliferation of unsold houses in a tight real-estate market is giving mosquitoes a bonanza of breeding opportunities -- even during an exceptionally dry year, officials say. That has elevated concerns about the West Nile virus, a mosquito-borne disease that can be fatal.

Foreclosures appear to be a huge factor in the proliferation of neglected pools, said Mulligan, whose district covers Clovis and north and east Fresno.

"People who can't afford to pay for their homes will neglect their pools -- they're the first thing to go," Mulligan said. "Then they move out, and there's really no one to maintain them."

Home foreclosures have been on the rise in the Fresno and Clovis area. The number of foreclosure notices sent to homeowners in Fresno County has more than doubled between the first quarter of 2006 and this year's first quarter -- from 540 to 1,116 -- according to DataQuick Information Systems, a private company that tracks home sales.

ABX Resumes Slide Below Record Low Close

From Reuters:

By Nancy Leinfuss

NEW YORK (Reuters) - Benchmark U.S. subprime mortgage ABX indexes slid further in nervous trade on Wednesday, as Moody's Investors Service weighed in with another downgrade warning to $5.0 billion of collateralized debt obligations, traders said.

ABX 07-1 "BBB-" index, which is tied to loans made to risky borrowers in last year's second half, opened at 50.50 bid on Wednesday but quickly sank to a 49 bid by afternoon, falling below Tuesday's record low close of 51.42, traders said.

The ABX 06-2 index, which references loans from 2006's first half, opened around 58 bid but slid to 55.16 bid in afternoon trade, also falling below Tuesday's record low 58.58 close, traders said.

Credit quality of subprime mortgage bonds fell to a record yesterday

Here is a link if anyone wants to follow the market

From Bloomberg. “Corporate bond risk soared in Europe by the most in at least three years as debt rating downgrades on U.S. subprime securities triggered a worldwide selloff, according to traders of credit-default swaps.”

“Europe’s iTraxx Crossover Index jumped as much as 41,500 euros to 308,000 euros, the biggest daily move since the index was created three years ago, according to JPMorgan Chase & Co. The CDX North America Investment-Grade Index of credit-default swaps on 125 companies increased $2,500 to $50,750, the highest in 19 months, Deutsche Bank AG prices show.”

“The Crossover index may rise as high as 400,000 euros because of ’subprimemania,’ as well as concern about falling corporate earnings and rising oil prices, Jochen Felsenheimer, head of credit strategy at Italy’s biggest bank Unicredit Group, said in a note to investors today.”

“‘The Goldilocks scenario for credit markets is definitely over,’ Munich-based Felsenheimer said. ‘These rating actions, the biggest ever in the subprime market, have the potential to trigger an even more substantial move in credit markets.’”

“The credit quality of subprime mortgage bonds fell to a record yesterday in New York. The ABX-HE-BBB- 07-1 index that tracks securities rated BBB- fell 7.4 percent to 51.42, according to the index administrator. The index has declined by almost half since January, reflecting the increased likelihood of default on the underlying securities, which have the lowest investment-grade ratings.”

“‘People are very nervous,’ said Alex Moss, who helps manage $94 billion of fixed-income assets at Insight Investment Management in London. ‘There’s a lot of concern the selloff in subprime will feed through to the wider market. Until the market finds a floor, it’s difficult to see where the buys are going to come from.’”

Foreclosure's filthy aftermath

As a dog lover this really pisses me off!

From MSN:

As foreclosures become more frequent, so do the stories of abandoned animals, insect infestations and deplorable living conditions.

By Maya Roney, BusinessWeek

The mortgage mess is getting even messier. Literally.

Malnourished and flea-ridden animals, feces-covered floors and urine-soaked furniture, piles of rotting garbage, swarms of diseased mosquitoes -- these are the horrors that may await the sheriff, property inspector, real-estate agent or passer-by making that first visit to a deserted home.

With foreclosure activity well above last year's levels and still on the rise in many parts of the country, nasty surprises like these have become more common. In April, there were 147,708 U.S. foreclosure filings -- default notices, auction sale notices and bank repossessions -- down 1% from the previous month but still 62% higher than a year earlier, according to RealtyTrac, an
online foreclosure marketplace based in Irvine, Calif.

"It's almost every day now that we see a (foreclosed) house in awful condition," says Scott Mitchell, the president of National Property Inspections, a company that provides home inspections and assessments in the Las Vegas area. "We've really noticed it increasing in the last month and a half."

RealtyTrac estimates that Nevada had the highest foreclosure rate in the country in April, with one filing per every 232 households.

Pets left for dead

Many animals are not so lucky. Pets are often silent sufferers during the foreclosure process. Homeowners in financial straits may make them a low priority to begin with, and when foreclosure leads to eviction, they are sometimes abandoned without food or water and left to breed uncontrollably.

In May alone, authorities found 23 abandoned animals in a house in Lake Carmel, N.Y.; 20 birds in a Lorain, Ohio, house; 24 horses on a Bixby, Okla., property; and more than 60 cats in a home in Cincinnati. All of these properties were in foreclosure, and most of the animals were injured, infected, dehydrated and starved nearly to death.

"There are a lot of hoarders and neglected animals and people who just don't realize how fast things can spin out of control," says animal rescue worker Gail Silver, who discovered the cat-filled home in Cincinnati.

If you're facing foreclosure and are unable to care for your animals, call a shelter such as the Best Friends Animal Society.

Spaying or neutering your pets will save you money in the long term because a female cat can have a litter of as many as seven kittens up to three times a year -- that's a lot of extra cat food. Spay/USA is a nationwide network and referral service for affordable spay and neuter services with a hot line (1-800-248-SPAY). Surgery at one of the clinics in the network averages $50, about half of the average cost in a vet's office.

"So many problems are very complex; this is a simple problem," says Spay/USA founder Esther Mechler. "And it's scary to think that with rising foreclosures, these animals will be some of the hidden victims."

California foreclosure sales skyrocketing

From the Central Valley Business Times:

Auctioneer gavels came down on 6,960 homes across California in the first six months of the year, according to ForeclosureRadar, a Discovery Bay-based foreclosure information company.

Yuba, Sacramento and San Joaquin counties ranked 2nd, 3rd and 4th highest respectively with Marin County having the lowest foreclosure rate in California.

Foreclosures now represent 16 percent of all new and resale home sales in the state, according to the company’s figures.

“Lenders are building a significant REO inventory. Since Jan. 1, 2007, a total of 29,696 California properties have been returned to the lender for an astonishing total loan value of $12 billion,” says Sean O'Toole, ForeclosureRadar founder and principal. “This is unprecedented.”

In June alone 6,552 properties were returned to the lender for a total of $2.69 billion.

Foreclosure & REO lists

I have added a set of links to various real estate owned/ foreclosures by several large lenders.

Inventory Update

Inventory continues to pile up. We now have a new record of single family homes for sale on the market today:

4,218 listing(s) found.

This year the spring selling season was a bust; now the summer selling season appears to be a bust. Whatever does not sell in the next 45 days will have to wait through a long fall and winter before next years spring selling season.

IMO only the most agressive of sellers is going to move their product in the face of significant supply, declining demand and tightening credit.

Good luck FB's!

Carl Cole lashes out at the newspaper after project fails

From today's Bakersfield Californian:

Deal on tower project falls through

BY JENNY SHEARER, Californian staff writer

Negotiations ended Monday between would-be developer David Crisp and Cal State Bakersfield for a twin 24-story tower project on campus.

But Carl Cole, Crisp's former partner, had a different take. He said recent reports in The Californian about a rash of defaults on Crisp-related properties affected the deal.

"You guys have single-handedly had a big part in this. I have no comment for The Californian," Cole said Monday afternoon.

University spokesman Mike Stepanovich said newspaper reports had no bearing on the decision to end negotiations.

"It was strictly a business decision on the part of the president," he said.
Crisp did not return a phone call for comment Monday evening.

When Crisp was asked about the status of the towers project on Wednesday, he declined to comment.

CSUB ends Towers Project

From the CSUB Website:

California State University, Bakersfield has ended negotiations with Crisp & Cole Real Estate for the development of a hotel, residential, restaurant, conference and retail facility that was to be located on the campus grounds, CSUB President Mitchell announced in a memo to the campus community today.

The memo, in its entirety, reads:

"I have kept you updated from time to time on the status of our proposed public-private partnerships. I am writing now to let you know we have ended our negotiations with Crisp and Cole Real Estate (now Crisp Real Estate) on an agreement for the development of a project which would have consisted of condominium, hotel, restaurant and retail components. The agreed-upon negotiation period began on January 30, 2007, and ended on June 15, 2007.

"While Crisp Real Estate worked hard to meet the University's requirements for this very innovative and ambitious project, they were unable to do so during the negotiation period. Those requirements were:

'By June 15, 2007, the University must receive, in letters addressed directly to the University from your principal partners: (1) confirmation of equity investments and/or financing sufficient to cover projected project costs estimated at $300 million-$400 million, (2) confirmation of an agreement with a hotel partner, and (3) confirmation of an agreement with a construction partner.'

"CSUB was given conceptual approval by the CSU Board of Trustees in January 2007 'for the development of residential, hotel, restaurant, parking and retail space on the California State University, Bakersfield campus.' Since that approval was not tied to having Crisp and Cole Real Estate as the development partner, the University can move forward with a project with all or some of those components without having to go back to the Trustees for conceptual approval.

"The component of the proposed project that would have been most directly beneficial to our academic mission from a program standpoint was the hotel and conference center. The condominiums had less direct program impact, but would have provided substantial long-term annual ground lease income. Within the coming months the University will issue a new RFP [request for proposal] for a public private partnership that would consist of a hotel and conference center.

"I will continue to keep you updated as we move forward."

Wells Fargo Prime closing Bakersfield Location

Hat tip to rateprotector at the Implode-O_meter:

Changes for Prime Wholesale Operations Locations

A Message from Kathleen Vaughan, EVP, National Prime Wholesale Manager and Tim Curtis, SVP, National Prime Wholesale Operations Manager

As part of our objective to position our organization to become more efficient and to best serve our customers, we have made the decision to realign our operations locations. This will ensure our capacity model is properly balanced against our commitment to efficiency and superior service to our customers.

In line with this effort, today we are announcing the closing of our Prime Wholesale Operations in Bakersfield , Phoenix , Pittsburgh , Portland , Sacramento , and St. Petersburg . The volume from these locations will be transitioned over the next few weeks to other locations and details will be provided to both our impacted teams and clients. Impacted team members were notified of these changes earlier today.

Local Real Estate Fraud Update

I was listening to KERN 1410 this morning and Brian Wiley from the Moneywise Guys stated that he has seen the documents related to the FBI investigation into the local real estate actvities.

He also stated that fraud was involved in the transactions.

I have emailed him and am trying to get more detailed information.

What happens when foreclosures pile up in your neighborhood?

Bloomberg reports from Georgia. “Only the possums are enjoying the backyard of 2035 Lilac Lane in Decatur, Georgia, where Wall Street titan Bear Stearns Cos. is just another homeowner by default.”

“It’s a mess,’ said Kiwanna Ford, who grew up next door to the vacant brick ranch-style house four miles south of the DeKalb County Courthouse. Bear Stearns seized the property three months ago after Ford’s neighbor stopped making payments on his mortgage. ‘If we wanted to sell our house right now with that next door, it would hurt,’ she said.”

“After selling the property last week, Bear Stearns said it still owns 18 houses in the Decatur area acquired since November. Citigroup Inc., Morgan Stanley, Merrill Lynch & Co., Lehman Brothers Holdings Inc. and JPMorgan Chase & Co. are listed in public records as the owners of at least 35 homes in the suburb.”

“The value of U.S. homes held by commercial banks swelled 53 percent nationwide to $2.3 billion at the end of March, the highest since 1992, from $1.5 billion a year earlier, according to the Federal Deposit Insurance Corp.”

“The dilemma facing banks is whether to pay maintenance costs or dump the properties at fire-sale prices, said Keith Gumbinger, vice president at a mortgage research firm. Both options can reduce real estate values. ‘No lender wants to own real estate, but at the same time you can’t just unload these properties because you would send home prices into a freefall,’ Gumbinger said.”

“Bear Stearns took possession of the three-bedroom Lilac Lane house for $76,500 on March 6, according to the foreclosure deed. The owner who defaulted had purchased the house in April 2005 for $160,000 using a subprime loan that required no money down. He had been renting it out, according to the neighbor, Ford.”

“The lender was Meritage Mortgage Corp., one of more than 60 subprime home loan companies that have halted operations, gone bankrupt or sought buyers since the start of 2006, according to data compiled by Bloomberg. Bear Stearns had bought the mortgage from Meritage at a discount.”

“The firm sold the Lilac Lane house on June 28 for $84,000, said Elisa Marks, a Bear Stearns spokeswoman. That’s about half the price paid two years ago.”

“Whether selling at auction or using a real estate broker, lenders usually get ‘cents on the dollar,’ which undermines the confidence of mortgage bond investors by showing property values are nowhere near the loans they collateralize, said Keith Shaughnessy, president of Foundation Mortgage Corp.”

“‘It will have a decimating effect on the mortgage-backed securities market when lenders start facing the music and letting property go at whatever price people will pay,’ Shaughnessy said.”
“‘I hope they’d continue to hold them, because selling them at a price that’s too low would have an adverse effect on the neighborhood,’ DeKalb County Commissioner Connie Stokes, who is also a real estate broker, said of Decatur-area foreclosures.”

“In Decatur, JPMorgan owns a brick ranch-style house on Kelley Lake Road, according to the tax assessor’s office. Bear Stearns holds a second mortgage on the property, said spokeswoman Renu Aldrich. The vacant house sits across the street from an elementary school.”

“The former owners bought the three-bedroom property in September 2005 for $155,000 with no down payment, using a so- called piggyback loan, or a second mortgage taken out at the time of sale, according to the deed. Both loans (are) now defaulted.”

“‘It’s sad to see the empty houses,’ said Janette Brown, who has lived two doors away for 25 years. ‘I’m worried about what it might do to the values.’”

Crisp & Cole Associates defaults now at over $24 million

What a surprise, these real estate geninuses have now left defaults of over $24 million in their wake, burned out lawns, investigations into their lending company, investigations into their real estate company, IRS tax liens and word is more to come.

It needs to be noted that this Seven Oaks mansion was featured
Here in August 2006 as a flip or flop.



Here is the latest from the Bakersfield Californian:

Crisp defaults pile up

Latest notice on $1.75 million loan for Seven Oaks mansion

BY GRETCHEN WENNER AND VANESSA GREGORY

It's impossible to know what state regulators are looking for as they examine files of the former Crisp & Cole Real Estate company.

Two former staffers recently told The Californian that investigators from the state Department of Real Estate have been asking questions and requesting files.

Meanwhile, default notices continue to pile up for properties related to Crisp & Cole.

The latest default notice sent to 27-year-old David Crisp last month concerns a $1.75 million loan for a stately Seven Oaks mansion.

Three homes are scheduled for auction this week alone.

Nearly 40 others -- most in southwest Bakersfield -- are in some stage of foreclosure.

Californian research has uncovered a pattern of property turnover among Crisp & Cole associates, steep price increases and 100 percent financing by subprime lenders in many of the properties now defaulting.

For example, a southwest property on Via Bonita Drive initially sold for $342,000 in October 2005. Five months later, after some deed shuffling with a business associate of Crisp & Cole, a Crisp family member bought the home with 100 percent financing for $549,000.

The new price showed an increase of $207,000, or more than 60 percent, in less than six months.

The property defaulted in May.

In the latest crop of Crisp-related defaults, it appears homes were purchased in clusters in some neighborhoods.

Near the $1.75 million default mansion on New Quay Court, which now sits empty, at least eight other defaulted properties tied to the Crisp network are also vacant. Lawns have turned brown in front of some.