There is a blog called "I am facing foreclosure" started in September of 2006 by Casey Serin. He is a 24 year old "would be real estate mogul". He bought 8 houses in 8 months in 4 different states. Unfortunately he bought at the peak of the market and has been unable to sell these homes.
This blog is following every single mistake and attempt to rectify his mistakes. He has currently had 4 homes foreclosed, sold 2 homes, and 2 are trying to sell. He is trying to even just "short sale" the homes for less money than he bought it for. He was $2.2 million in real estate debt.
This guy even if he sells everything will end up deeply in debt from this mishap. Is it a mishap? I don't know. Is he to blame? Yes. Is the mortgage company also to blame? Probably, he admits to using stated income loans, as he calls them liar loans, to try and finance the homes. This meant on his application he lied about his income.
I can't help but wonder how could he do this? Didn't he worry at all? Probably not, he really bought into the Kiyosaki mindset. That you make income by generating passive streams of income like RE. To be honest there probably are many more people out there in the same situation as Casey Serin.
Maybe not on the same scale, just one home they live in, but possibly there are a ton of other "flippers" in the same boat as him, just not blogging about it. The truth is I bet a lot of people bought into making easy money in RE. Which is not true.
If making money in RE was easy, everyone would do it. Also not true is that RE is a guaranteed investment. Um, guess Casey Serin is case and point that there is no "sure" investment, or else it wouldn't be an investment if there was no risk. Want no risk, buy a CD or money market. Don't touch RE or stocks.
I am not against using RE for investment purposes, but I really wonder if people fully understand the risks involved? Well this blog gives so many details about everything which can go wrong, that I am HIGHLY reccomending it to ANYONE thinking about investing in RE outside of their primary residence. If you are going to be a landlord or flip houses, you need to read this entire blog first.
Everyone should read it and understand his explanations for how he's losing money. There is money lost on closing costs, money on rehabbing homes, money lost on selling a home/staging, money lost on carrying a home for any length of time because of the mortgage involved. Thus RE is not a sure money maker, nor is it easy.
I think what he did is terrible, but I have to say it's one of the most insightful/truthful blogs about RE. He's laying it out on what the real issues and problems are with RE investing. So before you jump I'd read this blog.
Friday, April 06, 2007
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Thanks for the reminder about this blog! I agree that real estate investing is no easy or quick way to get rich. The "Rich Dad, Poor Dad" guy, Kiyosaki, doesn't offer any concrete strategies for how he's been so successful, probably because they don't exist. But he's sold a lot of books.
I think the best strategy is to buy a house, live in it a while, and then buy another house and rent out the first. Repeat several times for 30 years and you'll be okay, unless you get too creative with the financing. Put 20% down and take a 30 year fixed loan.
You can make a lot of money in real estate; you've got to be smart about it. You've got to look at the cash inflows and outflows and analyze them before you buy. True, there are risks as there are in everything, but you just need to understand how it works before you rush out and just start buying like it seems this guy did.
-limeade
I feel this blog is a must read for people before they leap into RE. I don't think RE a bad investment, not something I want to do, but you can make a lot of money in it.
I do think that with shows like Flip this house, etc, people like my mom believe it's sooo EASY to make money in RE. That you just buy a place and fix it up.
Which this guy is showing it's not what it looks like on TV. Easy money in real life doesn't exist. But people like Casey Serin buy into that myth. They just believe that everyone can make a quick buck.
I've been following this blog pretty closely, and I have some real issues with Casey Serin. I think he's made some extremely bad choices up to and including federal crime, and there seems to be no acceptance of responsibility or willingness to learn from his many mistakes.
I thought that he can't declare BK because it would be a crime? It would mean he'd face charges?
Real Estate is the greatest way to wealth over time; which means, years not months. The lesson to learn here is the TV generation and all the bull that is shown on television today is just crap. The bling,bling and instant gratification is there to make the viewer life the life of the actors. Most of the pople shown on these programs would be in jail or smoking crack somewhere if they were'nt on the tube.
I don't think that people who invest in RE long term (years) are the types of people who get into trouble. Those people consider the ramifications of their investments.
People who hope to make a quick buck from RE are the ones who don't consider long term or short term risks.
I admire the guy for at least not looking for an easy out with bankruptcy.
Perhaps in life there are no easy outs even BK. BK has it's own repurcussions.
Casey Serin in a nutshell: send Casey Serin to Prison. To learn more, read Casey Serin, Foreclosed and Exposed. You'll need some comic relief, so Casey Serin Jokes are in order. Then you'll have to go toCasey Serin's Ridiculous "Live Chat". "Where is Casey's wife in all this?" you must be asking, so you'll want to peruse Send Galina Serin to Prison. You will then be frustrated, thinking Did Casey Serin Ever Intend to Repay His Dubious Loans?. And as this thought occurs, you will learn that Casey Serin Begs his Haters for Online Dollars. "Wow. This guy must really be a con artist," you say to yourself, and need to read Defining "Intent". More comic relief is in order now, so you'll feel very much in the know with Mocking Casey Serin On YouTube. But, oh, Casey Serin just did another national media outlet! Check out Suze Orman Shows Her Ass. Casey Serin is now showing up in random places, like Casey Serin: The Human Zoo. By this point, you will feel compelled to take action. The place for this is "The Casey Serin Project". Just when you think it can't get worse, you learn that there are Even More Casey Serin Companies, providing days worth of
fodder for junior detectives everywhere. This whole generation is fucked, you will conclude, and find yourself emailing Bringing Up Baby: True Tales of Generation layZee to everyone you know.
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