House Poor: Just Another Learning Experience | Armonk NY Real Estate

House Poor:

Just Another Learning Experience

By Homer Guthrie

Expert Homeowner

Have you ever had that free-falling feeling, like someone has blindfolded you, pushed you out of an airplane door at 5,000 feet and all you can do is scream at the top of your lungs and wonder how long it will take before you hit the ground?

That’s what buying a foreclosure felt like.

I was counting on my real estate team, Bea Meriwether, my real estate agent, and Earnest S. Crowe, my mortgage guy, to guide me through the process. After all, they were the ones who had talked me into it. They said I would make eight percent or better and I would learn a lot. They were half right.

Bea had her eye on a sweet little bank-owned split-level not far from my home in Mirage Mills, a suburb widely known as the Chernobyl of American real estate because we live in the epicenter of the foreclosure crisis. I had to close out my 401K to pay for it and by the time the check arrived, the house was gone. So Ernest had another idea.

“Let’s play poker with the big boys,” he winked at me. “That’s where the real deals are.”

That didn’t sound like a very good idea to me. I’m a terrible poker player. When I try to bluff, my voice turns squeaky and gives me away.

Ernest’s “real deals” would be at the next sheriff’s auction of foreclosures, a popular event in Mirage Mills. In most counties, sheriff’s auctions are just a few guys meeting outside a courthouse once a month. But in Mirage Mills, dozens of people show up to watch serious investors spend tens of thousands of dollars on foreclosures they had seen only from the street. Most of the crowd consists of carpenters, plumbers, electricians, roofers and landscapers hoping to get hired to fix the messes that the new owners will soon discover.

Ernest got a list of the foreclosures to be in the next auction and the three of us toured the houses up for bid. To my way of thinking, if you’ve seen one house with a line of laundry out the back because the dryer is busted and a dirt yard packed hard by little bare feet and blistering sun, you’ve probably seen them all. Bea and Ernest, on the other hand, unanimously felt that 12765 Prosperity Way was the deal of the day, bound to make some smart guy a potful of money. The way they added it up on my kitchen table, I was going do a whole lot better than eight percent.

So when the big day came, I was standing at the courthouse steps with a cashier’s check for nearly all the money I had to my name. Both Bea and Ernest and other appointments that morning and were late. Felicity went to get coffee, leaving me alone with several other guys in the middle of the crowd, when a county bureaucrat appeared and started rattling off case numbers and addresses from a clipboard. When nobody bid on any of the homes, they all went “back to the beneficiary,” whatever that meant. Things got boring. I really needed Felicia’s coffee.

Suddenly the bureaucrat said “Prosperity Way.” My nerves kicked into overdrive. I knew my team would kill me if I missed this house.

She read the opening bid, which was the minimum amount the bank would take for the foreclosure and looked up.

“First bid?” she asked.

“Yes, please!” I squeaked as loudly as I could squeak.

At that very moment a police car sped past the courthouse with its siren blaring. She didn’t hear me even though I was less than ten feet away.

The siren was still sounding when she asked, “Second bid?”

A big man in sunglasses standing right next to her silently raised two fingers like he was Winston Churchill. Obviously, he was a regular who knew the secret code.

“Mr. Cameron bids two hundred thousand. Last bid. Anyone else?” she asked and quickly looked around. “No?”

Desperate to be heard, I pushed my way in front of her and squeaked into her face so loudly that she had to notice me. No sense playing around with a pro like Cameron, so I bid the limit we had agreed upon. “Two fifty!”

Cameron took off his dark glasses, gave me a peeved look, laughed sarcastically and muttered “You gotta be kidding me.” He shook his head at both me and the county bureaucrat to indicate he was done. She acknowledged me at last. She asked for my cashiers’ check, took down my name and address, and gave me a receipt and some paperwork. I was the proud owner of a foreclosure that was going to change my life in ways I couldn’t imagine.

I stepped away from the circle of bidders and sighed. It felt good to best the big boys at their own game. Just then Felicity arrived with the coffee. As we sat on a bench and sipped, I told her the good news. Instead of being pleased she was concerned that I had spent so much, so I described my fierce bidding war with Cameron and how I crushed him into dust. “He wanted it sooooo bad,” I gloated. “That pretty much confirms that we got a great deal.”

“Oh, my God,” she shouted suddenly when she read the receipt. “No, you didn’t!”

“Didn’t what?”

“Homer, please dear God in heaven please tell me this is not the house you bought.”

“All sales are final. Why?”

“You didn’t buy 12765 Prosperity Way. This is a receipt for 12675. Oh, Homer, that’s ten blocks away from the house we wanted!”

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