Beat the bank in San Juan

We have profiled in the past how some lower-end San Juan condo complexes are getting reamed right now, but today's property is in fact a single family home that is a short sale. If you hurry, you might be able to beat the bank on this one - the auction is scheduled for May 19 at 10 a.m. Better get a move on...

25765 Avenida Pedrigal, 92675
Asking price: $399,000-$425,000
Asking price/ sq ft: $374-$399
Income requirement: $106,250
Purchase price: $553,000
Purchase date: 7/29/05
Size: 2 beds, 2 baths, 1,066 sq ft (built in 1972)
MLS: S521688 (76 days on Redfin)
ZipRealty price tracker: Price Increased: 03/26/08 -- $385,000 to $395,000
Zillow Zestimate: $438,500
2007 property tax: $5,722
HOA dues: $75
Type: Single Family Residence
Style: Townhouse
Stories: 2 levels
Lot size: 1,553 sq ft
From listing: Beach Close Home. New ceramic tile with mosaic inlay in the downstairs area. Fireplace in living room. Master Suite with walk in closets and balcony. Upgraded powder room. Private yard with cobblestone patio. Approximately 1 mile to Dana Point Harbor and local beaches. Bank has approved short sale at $425,000. Owner paid $553,000 in July of 2005. Must be able to close quickly to beat the bank!

Owner paid $553,000 in 2005, huh. Want to guess how much of their own money they actually used? You got it: Nothing. Zero. This owner was able to get 100% financing through a $442,400 first mortgage and a $110,600 second - it's yet another 80/20 loan situation.

The notice of default was filed in early November in the amount of $10,553. The notice of trustee sale was posted in February. The amount was $462,982. That means unpaid interest and additional fees have driven the amount well above the original loan amount. This property is going to be a big loser for the lender.

It's kind of a mystery as to why the bank has approved a short sale for $425,000, and yet the property is listed at a price range of $399,000-$425,000. Do you really think the bank will go as low as $399,000? And even if they would, do you think they would get back to you in time to save this from auction?

Assuming a sale for the approved price of $425,000, the loss would be $153,500, including 6% sales costs. It would also be a depreciation of 23% in less than three years, not including transaction costs.


View Larger Map

Other owners on the street are not faring too well, either. You may also be interested to know that 25719 Avenida Pedrigal is an REO that is not for sale yet. Those owners bought the property for $600,000 in 2006 using a $480,000 (80%) loan. The home went back to the bank in January for $449,000 and is owned by Avelo Mortgage.

And, 25711 Avenida Pedrigal is for sale - at $146,500 less than its 2004 price.