Oak Brook New Housing Developement in Forclosure

(Crain’s) — Bridgeview Bank Group has filed to foreclose on Brittwood Creek, an exclusive 56-acre development of posh single-family homes in Oak Brook by longtime suburban homebuilder Callaghan Associates Inc., another reminder of the nearly dormant market for new high-priced homes.

After paying $21.3 million for the site in late 2006, a Callaghan-controlled venture has apparently sold just one of the 30 lots in the subdivision, at State Route 83 and 35th Street in the western suburb.

The wooded development site, which includes a winding creek, is about 2 miles south of the bustling Oakbrook Center shopping mall. Roads, sewers and other infrastructure have been constructed.

Callaghan financed the purchase and other development costs with a $24.7-million construction loan from Bridgeview, based in the southwest suburb.

But in September, the Callaghan venture began missing monthly loan payments, according to a complaint Bridgeview filed Oct. 29 in DuPage County Circuit Court Court. The total amount due is a little more than $23 million, the complaint says.

A lawyer for the bank, John J. Pcolinski Jr. of Wheaton law firm Guerard Kalina & Butkus, says, "It is appropriate for the parties to continue negotiations. We're hopeful it will be resolved satisfactorily for all parties."

Daniel Callaghan, president of Westmont-based Callaghan, did not return calls requesting comment. His father and the founder of the company, David Callaghan, died in July at age 80.

David Callaghan began his development career in 1954 building houses in Oak Lawn for first-time home buyers, eventually expanding the company to include multi-million-dollar mansions, according to an obituary in the Chicago Tribune.

In recent years, Callaghan Associates focused on developments targeting empty-nesters, such as the 78-home Forest Gate subdivision in Oak Brook, which is nearly complete, and the Savoy Club, a planned 52-unit project in Burr Ridge

Happy Thanksgiving Day

May you and your family have a wonderful day. I will be celebrating with my family out of town for the day. Will be posting next week. Beth

What is "As Is" buying a home.

Banks are selling their properties, “As is” but what does, “as is”, really mean?

• Does it mean that once I make an offer I have to accept the present condition of the house?
• Does it mean that when I take a look at this house I have to sneak around and check everything before I make an offer?

This is what “As is” means:

“It means that you are purchasing this home in it’s present physical condition. The seller (bank) is selling you the house without any warranties or guarantees of its condition whatsoever. The seller (bank) will not repair or improve on anything, period.”

But does this mean that you have to purchase your prospective home blindly? The answer is NO.

Even though you are purchasing a property “As Is” you still need to know what “As is” is. Do you follow me?

This is why you should always elect to do a home inspection especially on a bank owned property where no one knew how the home was cared for and no one knows what happened right before the past owners left the property. They could have done some things that made the property unsafe or could have done damage that wiped out any profit you had calculated into the deal.

You need to ask for this home inspection period so you can find out what the “As is” condition is of the property. Once you are satisfied with the present condition is when you proceed with the purchase. If not, cancel!

Yes, you lose out on the cost of the home inspection but that is the price you pay for taking this on.

The cost of the home inspection is well worth it considering the headache you would have had in the future trying to make the house livable.

Villa Taj .......still empty.

The eastern influenced home at the corner of Plainfield and County Line Road, started out at being listed for $24,000,000. It was such a joke in the fact that the house had little land with it. So the builder- a doctor, then placed it up for foreclosure auction with the starting bid of $6,250,000. It was a sealed bid auction. Three people came with checks for the down payment of $250,000. At the auction it was not placed on the block, instead they took all 3 bidders information and told them that they would meet with the builders lawyer and place a one time bid with the highest as the winner. There has been no word about the meeting and the home is still empty. Meanwhile the Doctor has moved to Florida and started his practice there. The Doctor had never built a home before and this was his passion to build his dream palace. Unfortunately he had no clue about the market. I wonder how he is going to avoid capital gain taxes. Stay tuned.

This is Last Months Foreclosure

Illinois had the dubious distinction of being 3rd in the nation in October for the number of foreclosure filings with 19,946, the highest monthly total since January 2005. It beat out states such as Michigan, which ranked 7th.

One in every 263 homes in Illinois received a filing.

In Cook County, the closest set of data we have for the city of Chicago, foreclosures filings spiked 67% from a year ago to 11,494. It was also 131% higher than September.

There are government forces at work which led to the sudden spike.

From the Associated Press:

The rise in Illinois in October compared with September can largely be attributed to foreclosure activity catching up in the wake of a state law signed in April giving delinquent homeowners more time to work out deals with lenders, says Rick Sharga, senior vice-president at RealtyTrac.

The law created artificially low numbers for a several months earlier this year in Illinois, Sharga says. The numbers have increased as lenders have learned how to work through the process in the wake of the law.

Illinois third highest state with foreclosures [Sun-Times, Francine Knowles, Nov 12, 2009]

Local foreclosure activity jumps after artificially low period [Associated Press, Nov 12, 2009]

Hinsdale Area Market Report for the Last 30 Days

This is the area report of single family homes sold in the last 30 days compared to last years.

Hinsdale: 127% increase

Western Springs: 220% increase

Clarendon Hills: 117% increase

Burr Ridge: 200% increase

Downers Grove: 189% increase

La Grange: 114% increase

Marketing times are averaging 8-12 months dependent on town, housing type and price range. Expensive homes are taking longer to sell. The $8000.00 tax credit is applied to some of the sales. The area is showing more activity but prices are lower than last year. We will see how the2009 ends.

If you are interested in selling your home, call 630-464-2633.

33 W. Deleware 8-C

Connect mls

I have listed this wonderful Studio apartment for sale in the Gold Coast. The building has party deck, office workstation, work out room, and 24 hour door security. It is between State and Dearborn and allows small dogs and cats. The studio is pottery barn decorated and features, new window treatments. Has a full walkout balcony and seating for table and chairs. Just steps to all the restaurants and shopping Oak Street and the Michigan Ave. The unit is great for investors. Call for a showing. Listed for 161,900.

Well you knew this was coming

Good to Know.|

The Worker, Homeownership, and Business Assistance Act of 2009 has extended the tax credit of up to $8,000 for qualified first-time home buyers purchasing a principal residence. The tax credit now applies to sales occurring on or after January 1, 2009 and on or before April 30, 2010. However, in cases where a binding sales contract is signed by April 30, 2010, a home purchase completed by June 30, 2010 will qualify.

The income range for eligible purchasers has been expanded so that the credit doesn’t begin to phase out until the modified adjusted gross income of purchasers exceeds $125,000 for single filers, $225,000 for joint filers. The old phase-out thresholds were $75,000 and $125,000, respectively.

The credit has also been expanded to cover purchases of a new principal residence by people who have lived in their current principal residences for at least five out of the last eight years. However, they will only be eligible for a $6,500 maximum credit. The tax credit applies to sales for those purchasing a principal residence after November 6, 2009 and on or before April 30, 2010 (or purchased by June 30, 2010 with a binding sales contract signed by April 30, 2010).

More information is available at www.federalhousingtaxcredit.com

Trouble for Nicholas Cage too

Reports are that bad business decisions, he is suing his business manager for 20 million dollars, is forcing the actor to liquidate his housing holding around the world. The IRS has a 6.3 million dollar lien on a couple of his houses and the actor has an auction scheduled for November 12th in New Orleans to sell 2 of his properties including the Haunted LaLaurie Mansion that he bought in 2007.

His holdings have included a pair of apartments on a swanky stretch of New York’s Fifth Avenue, a Bavarian castle in Germany, Dean Martin’s former home in Beverly Hills, Calif., and a townhouse in Bath, England, among others.

But apparent financial troubles have prompted Mr. Cage to try to sell several of his luxury properties during one of the most difficult real-estate markets in years. And in August, the IRS slapped tax liens on Mr. Cage’s two New Orleans properties – including the allegedly haunted LaLaurie Mansion in the French Quarter. Now both estates are to be sold at auction on Nov. 12. via WSJ

Good Read From the Real Estate Blogger

How do you make billions of dollars and screw every taxpayer, millions of pensioners, and get away with it?

Work for Goldman Sachs.

That seems to the be the story of the housing crisis as reported by McClatchy in a special report. And the worst part of the story is that there will be no consequences for the company, the politicians that helped create this mess, and those who lost huge amounts of money.

Check this out:

McClatchy’s inquiry found that Goldman Sachs:

• Bought and converted into high-yield bonds tens of thousands of mortgages from subprime lenders that became the subjects of FBI investigations into whether they’d misled borrowers or exaggerated applicants’ incomes to justify making hefty loans.
• Used offshore tax havens to shuffle its mortgage-backed securities to institutions worldwide, including European and Asian banks, often in secret deals run through the Cayman Islands, a British territory in the Caribbean that companies use to bypass U.S. disclosure requirements.
• Has dispatched lawyers across the country to repossess homes from bankrupt or financially struggling individuals, many of whom lacked sufficient credit or income but got subprime mortgages anyway because Wall Street made it easy for them to qualify.
• Was buoyed last fall by key federal bailout decisions, at least two of which involved then-Treasury Secretary Henry Paulson, a former Goldman chief executive whose staff at Treasury included several other Goldman alumni.

The firm benefited when Paulson elected not to save rival Lehman Brothers from collapse, and when he organized a massive rescue of tottering global insurer American International Group while in constant telephone contact with Goldman chief Blankfein. With the Federal Reserve Board’s blessing, AIG later used $12.9 billion in taxpayers’ dollars to pay off every penny it owed Goldman.
These decisions preserved billions of dollars in value for Goldman’s executives and shareholders. For example, Blankfein held 1.6 million shares in the company in September 2008, and he could have lost more than $150 million if his firm had gone bankrupt.
With the help of more than $23 billion in direct and indirect federal aid, Goldman appears to have emerged intact from the economic implosion, limiting its subprime losses to $1.5 billion. By repaying $10 billion in direct federal bailout money — a 23 percent taxpayer return that exceeded federal officials’ demand — the firm has escaped tough federal limits on 2009 bonuses to executives of firms that received bailout money.

So you have the sitting Treasury Secretary, Henry Paulson who (surprise, surprise) was the former head of Goldman Sachs, calling the current head of the company for advice on how to manage the housing and lending crisis. And the result is the decimation of a competitor and a bailout of Goldman with taxpayers money.

Oh, and did I tell you, Goldman Sachs reported record earnings in July when most of the other financial companies were still losing money hand over fist.

So lets recap, Goldman lent billions of dollars to homeowners who could not pay. Then they sold the debt as grade AAA to pension funds who lost a fortune. Then got huge bailouts for their poor investments while orchestrating the demise of it’s rivals by selective government participation coordinated by a former chief exec of the company who is now the Treasury Secretary.

Absolutely horrifying in my book.  However, with Goldman Sach's ties to government and the scandal that would occur if this became widely known, this scandal will never be fully investigated or prosecuted.