haapai
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Post by haapai on Jun 11, 2011 14:52:00 GMT -5
I've been poking around the county property search web page and checking out the sales transactions for properties owned by fannie mae.
In addition to much headslapping and gasps of WTF, I've encountered something that I have never seen before. The database that I am using characterizes sales as arms-length, foreclosure, uncharacterized (applies often to quitclaims), and something that I haven't seen before -- "invalid sale".
Any clue what that means in this context?
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2kids10horses
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Post by 2kids10horses on Jun 11, 2011 22:28:32 GMT -5
Ask the provider of the datebase.
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schildi
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Post by schildi on Jun 11, 2011 22:31:35 GMT -5
Ask the provider of the datebase. I'd say that was a useless reply. I think the OP was looking for somebody who knows what this term means, possibly with some more explanation. You could most likely reply with "Ask xxx" to any question ever asked here. haapai, unfortunately, I have no idea what they mean.
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2kids10horses
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Post by 2kids10horses on Jun 11, 2011 23:22:43 GMT -5
You're exactly right, schildi, it was a useless answer. But, how could anyone know? haapai didn't say what the database was! Was it a MLS? Tax Records from the Courthouse? Some third party reporting off the tax records? Appraiser's database?
Just as an aside, it used to be that when a property was sold on the Courthouse steps on a foreclosure, the bank would bid the loan amount they were due plus some amount for attorney's cost. So, when you look at the Deeds, you could see what the loan was, and have some clue as to what the value was at some point in time.
Today, the banks have so many foreclosures, they often bid as their opening bid on the Steps some amount less than what they are owed in the hope that someone will take it off their hands. A short sale, if you will. If no one bids against them, it will be recorded as a Sherriff's sale at the amount the bank bid.
That bid (sale) may STILL be grossy overvalued. It will show up as a "Comp", but it's not really a comp. It's not really a "Sale".
So, haapai, the provider of your database may be trying to take out the Sherriff's sales so they would not show as a comp. Maybe not.
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❤ mollymouser ❤
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Post by ❤ mollymouser ❤ on Jun 12, 2011 0:19:42 GMT -5
I wonder if it's a refi or something and that they're using the term "invalid sale" for some weird reason? I haven't seen that term used around here, so that's the best guess I can come up with.
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haapai
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Post by haapai on Jun 12, 2011 8:24:33 GMT -5
The records of the registrar of deeds are computerized, online, and free. That's what I was poking around in.
They seem to use some slightly different notations to exclude distressed sales and non-arms length property transfers from the equalization algorithm. Anything transferred by sheriff's deed tends to receive a "foreclosure" notations. Quitclaims filed to add or exclude a spouse (and with $0 recorded as the sale amount) tend to receive some variations of "exclude from ..."
"Invalid sale" might just be another variant of "don't use this this number for assessment purposes". On the other hand, it might be something more interesting. I'm seeing it attached to sales at relatively high amounts on properties that later plummeted in value.
I thought that there would be more of you who make a hobby of poking around in similar databases.
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happyscooter
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Post by happyscooter on Jun 13, 2011 7:24:19 GMT -5
Invalid-not qualifying?
Invalid-old?
English, it can go 2 ways.
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Colleenz
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Post by Colleenz on Jun 13, 2011 7:34:54 GMT -5
I do not know why they do this, but here the bank who owns the note always buys the property at the Sheriffs sales. Our neighbors wanted to buy a house in foreclosure to be closer to their grandkids. They went to the auction and bid, and the bank kept upping the bid. The neighbor finally gave up and let the bank take it. The bank turned around and listed it for well under what the neighbors bid, and they bought the house for less than they bid at the auction.
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iono1
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Post by iono1 on Jun 14, 2011 10:40:01 GMT -5
An invalid sale is basically a sale that for some reason isn't considered "arms-length" and would be excluded as a usable sale by an appraiser or assessor. Here are some examples from 2 sources. From The International Association of Assessing Officers book Property Appraisal and Assessment Administration: Non-Arm's Length Sales (p136-137): Sales involving courts, governmental entities, or public utilities; Sales involving charitable, religious, or educational institutions; Sales in which a financial institution is the buyer; Sales between relatives or corporate affiliates; Sale of convenience (correcting a deed); Estate Sales (qualified by the fact some are valid). On the NY State Real Property Transfer Report there is a section where one checks a box, usually indicating an "invalid" sale. A- Sale between relatives or former relatives B-Sale between related companies or partners in business C-One of the buyers is also a seller D-Buyer or seller is government agency or lending institution E-Deed type not warranty or bargain and sale F-Sale of fractional or less than fee interest G-Significant Change in property between taxable status and sale date (this doesn't indicate an invalid sale, it's to alert the assessor of significant changes) H-Sale of business is included in sale price I-Other unusual factors affecting sale price
It looks like a foreclosure would fall under D.
I hope this helps you now know what an invalid sale is.
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swamp
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Post by swamp on Jun 14, 2011 10:43:38 GMT -5
I've been poking around the county property search web page and checking out the sales transactions for properties owned by fannie mae. In addition to much headslapping and gasps of WTF, I've encountered something that I have never seen before. The database that I am using characterizes sales as arms-length, foreclosure, uncharacterized (applies often to quitclaims), and something that I haven't seen before -- "invalid sale". Any clue what that means in this context? It's a sale that appraisers would exclude from their comparables list because it's not an arms length sale that would establish fair market value.
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Deleted
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Post by Deleted on Jun 14, 2011 10:47:59 GMT -5
Zillow considers when my home purchase as an invalid sale. I think because the previous owners used a relocation company which they sold the house to who then sold the house to us in a rather short time frame.
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bean29
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Post by bean29 on Jun 14, 2011 12:17:59 GMT -5
Inono1 and Swamp, that info is really interesting...
I have seen that about 20% of sales in my area are forclosures and I thought I had seen that govt entities and appraisers do sometimes consider foreclosure sales as valid comps?
Does anyone with industry experience have anything to say regarding that?
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Clever Username
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Post by Clever Username on Jun 14, 2011 13:12:07 GMT -5
It's when they sell the home to someone who can't walk. Not sure who/why/when they started tracking that though.
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midjd
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Post by midjd on Jun 14, 2011 13:15:14 GMT -5
LOL! ;D
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swamp
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Post by swamp on Jun 14, 2011 14:55:10 GMT -5
Inono1 and Swamp, that info is really interesting... I have seen that about 20% of sales in my area are forclosures and I thought I had seen that govt entities and appraisers do sometimes consider foreclosure sales as valid comps? Does anyone with industry experience have anything to say regarding that? They take it into consideration when coming up with an appraised value.
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2kids10horses
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Post by 2kids10horses on Jun 14, 2011 22:27:17 GMT -5
In the past (ie "good old days") appraisers did exclude foreclosures from appraisals. That's when foreclosures were rare.
Now, unfortunately, foreclosures are the norm, and in some places just about all the sales are foreclosures. And, so, the foreclosures have depressed the market. Appraisers must now use foreclosures when determining the value of comparable property.
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haapai
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Post by haapai on Jun 15, 2011 5:55:27 GMT -5
The sales history of the house that I was looking at was particularly fishy. A member of a rather unusual local family was listed in the sales history. The sheriff's sale was for over $100K about a year ago and the house was subsequently listed at under $20K for a very long time. There was a good chance that someone had either done a huge cash-out based on a laughable or fraudulent valuation, or that someone had fought the foreclosure for a very long time (while the property decayed).
I was wondering if the notation indicated some problem with the deed or fraud in the mortgage.
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