Hard Money Lender Tom Hastert Demands Jury Trial

June 26, 2009 jd

It’s hard for me to imagine a man like Thomas Hastert a man who worked so hard to get ahead in this world becoming a felon. Hastert worked for the Nevada County Sheriff’s office, studied to become an attorney, then got his real estate broker’s license.

Once he got his broker’s license he proceed to engage in hard money lending in direct conflict with the law, making construction loans without fully funding them, a felony.

In addition, Hastert pleaded no contest to 62 counts of embezzlement, offering and selling unregistered and unqualified securities by false and incomplete communications. According to the Attorney General of California amounting to $20 million lost by his clients. That’s a lot of money to handle and lose. A standard fee for the mortgage broker Hastert is to charge is about 3 percent of the loan amount which means Hastert would have pocketed about $600,000.

Hastert’s attorneys and the California Deputy Attorney General Keith Lyon had reached a plea bargain that would have given Hastert five years in state prison. Normally that type of sentence means two and one-half years and he’s out of prison.

However, at the sentencing Judge Sean Dowling rejected the plea agreement and came back with his own sentencing of eight years and four months. Hastert’s attorney refused the new sentencing and demanded a jury trial.

I met Thomas Hastert some time ago, while he was an attorney. I did some investigations (as a civil engineer) for Hastert regarding building code violations for some of the real estate cases that he had. My impression of him at that time was that he was a nice person and I had no idea that he would resort to what he did. What does a person like that think? We have the Bernard Madoff, the Sir Walter Stanford’s who look you in the eye with a smile and steal your pocket book at the same time.

What do you think?

Business, Education

California State Board of Education Cooks Their Books

June 25, 2009 jd 3 Comments

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It seems that the California Department of Education has taken a leaf from Wall Street and AIG. Let’s keep the bad CEO’s which in this case are superintendents and their staff, layoff school teachers, and then cook the books on the rate of dropouts in the State’s high schools.

By using Wall Street techniques and new math, they claimed that the overall dropout rate for California dropped from 21.1 percent to 20.1 percent in 2008. But they noted only 68.3 percent graduated! The best guess is that the other 11 percent of students went into an equivalent of an offshore account where they were given a triple A rating.

Calling this unsecured account a derivative, they may somehow have become an asset instead of a liability.

It is my understanding that this account will be sold for additional funding for employing more staff for the management team and the administration.

In further accounting maneuvers, just a few months ago, they raised the high school dropout rate from 12 to 24 percent. Wall Street would indeed be proud of this administration.

By the way, according to the 2007-08 report from the National Education Association we spend more than $300,000 annually for each classroom of 25 students. My daughter is a school teacher and she has to buy paper and pencils for her students.

You know why? 75% of that money goes to salaries, benefits, administration and other overhead costs. That’s $9,000 per student or $225,000 per classroom per year for overhead. Now you know why they can’t provide pencils and paper.

Quoting the Visalia Times-Delta

““While enrollment has dropped by 70,000 in the last four years, the Department of Education (actually the districts themselves do the hiring) used its increasing funds to hire just 3,800 additional teachers while adding 15,600 more nonclassroom employees between 2004 and 2007. Our schools must have a reliable stream of funding, but it should be based on actual enrollment needs.”

Did you get that, they hired 76% more overhead then they did teachers. Yet, every time they cut the state budget for schools they lay off—teachers.

If you think this needs to be fixed, let your favorite politician know what’s going on.

Real Estate

Vultures are Coming to the Real Estate Market

June 24, 2009 jd 2 Comments

vultures

I have said many times on this site, now is the time to buy real estate if you have the money and can wait for the market to change. Now REITs (real estate investment trusts) with stronger balance sheets are building billion-dollar war chests to fund acquisitions of troubled properties on the cheap. They’re raising the money to fund acquisitions of distressed commercial properties.

REITs are more then ready, having raised over $12 billion by issuing stock in recent months. There’s an estimated $90 billion in the U.S. that is “distressed” according to New York based real estate research firm Real Capital Analytics.

These are properties that have been foreclosed on, or whose owners are in default on their loans or in bankruptcy. “On top of those properties, there is hundreds of billions more in debt coming due in the next few years,” says Peter Slatin, editorial director at Real Capital. “Some REITs are getting prepared for that.”
The four blue-chip REITs cited above represent a fairly conservative way for individual investors to profit from the (hoped-for) real estate rebound. The fact that they have the resources to exploit today’s weak market may set them up for years of healthy cash flows. “These are the commercial real estate companies that are going to survive,” says Jim Sullivan, senior REIT analyst with Green Street Advisors. “They all have balance sheets that are stronger than average and management teams that have proven their ability to take advantage of downturns.”

Anyone who goes bargain hunting in real estate today has to be patient. REITs fell earlier and harder than the broader real estate market. In the two years from March 2007 to March 2009, REIT stocks fell a stunning 75% on average. Lately, however, REITs have been on a roll, with the MSCI U.S. REIT index gaining more than 45% since the March low. Does this spurt mean that REITs are foreshadowing a sharp rise in real estate values? Some experts caution that there is more pain to come. “Prices have gotten ahead of the fundamentals in real estate,” says Kenneth Rosen, chairman of the Fisher Center for Real Estate and a professor emeritus at the University of California at Berkeley. “It has gone too far, too fast.” Rosen expects a correction in the coming months.

But many analysts like the longer-term outlook. “The underpinnings of the commercial real estate market are really in pretty good shape,” says Philip Martin, a senior vice president of Golub & Co., a Chicago-based real estate investment and development firm. He notes that there isn’t the kind of massive oversupply of commercial properties that existed during the slump of the late 1980s and early 1990s. “So when we do recover, you are likely to see a pretty healthy snap-back in real estate prices,” he says. “This is an excellent environment for those REITs with the right combination of knowledge and capital. They are going to have an opportunity to make some great deals, and the risk-adjusted returns at this point in the real estate cycle are going to be pretty darn good.”

Source: CNN Fortune

Real Estate

Federal Home Buyer Tax Credit Update

June 23, 2009 jd

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Lawmakers and businesses are calling for an expansion of the existing tax credit now capped at $8,000 to be raised to $15,000. The existing federal tax credit of $8,000 has been a success in spurring first-time home buyers to get back into the housing market.

A further proposed change would be that the tax credit would be applied to anyone who buys a home.

First-time buyers make up a hefty 40% of home purchases, according to the National Association of Realtors (NAR), which is about 5 percentage points higher than the historical average.

Some economists say a tax benefit is vital to spur home buying and help stabilize prices.

According to USA Today the current proposals are:

“•A Senate bill to expand the tax credit to $15,000 for any home buyer regardless of income was introduced this month by Sen. Johnny Isakson, R-Ga. It is co-sponsored by Senate Banking Committee Chairman Chris Dodd, D-Conn.

“It would go a long way toward inducing trade-up buyers into the market,” says Lawrence Yun, chief economist at the NAR.

•A House bill to keep the $8,000 credit in place until June 2010 and expand it to all home buyers was introduced last month by Rep. Kenny Marchant, R-Texas. It also would provide a $3,000 credit to homeowners who refinance.

•Another bill in the House, introduced by Rep. Eddie Bernice Johnson, D-Texas, would extend the credit to all home buyers through 2010.”

The present tax credit does not apply to singles earning more than $95,000 a year and couples who earn more than $170,000.

Buyers do not have to repay the tax credit if they occupy the home for three years or more.

nevada county fair

Nevada County Fair Partners with Summer Youth Employment Program

June 22, 2009 jd

The Nevada County Fairgrounds has partnered with One-Stop Business and Career Center’s Summer Youth Program to provide jobs and training to Nevada County youth.

The program provides young adults with employment skills in a planned, structured learning environment. It is designed to provide specific behavioral skills appropriate for the workplace, as well as to promote the development of good work habits and basic work skills. Each applicant must go through a job interview process before being placed in the program.

At the Fairgrounds, the young adults have been busy doing winter clean-up of the Fairgrounds, building benches, preparing various areas for this year’s Fair, installing bicycle stalls, landscaping, and painting. Their current project involves designing and landscaping a garden memorial, from its inception to its completion, near Gate 4.

“I believe in empowering our youth,” said Clif Mackinley, work program supervisor at the Fairgrounds, “and this program does just that. It empowers them, teaches them life and employment skills, and teaches them about taking responsibility on the job.”

The program, which is funded through federal dollars received from the Private Industry Council, provides participants the opportunity to work 40 hours per week at the Fairgrounds until the end of September.

“The work these young adults do is so beneficial to our Fairgrounds and our community,” said Robin Hauck, Deputy Manager at the Fairgrounds. “They are hard workers, with a strong work ethic, and their work is already evident to Fairgrounds’ visitors. It is a delight to have them working at the Fairgrounds.”

Contact: Robin Hauck, Deputy Manager
(530) 273-6217; robin@nevadacountyfair.com

For more information about the Nevada County Fair, August 12 – 16, call 273-6217 or visit www.nevadacountyfair.com. For information about the One-Stop Business and Career Center, call (530) 265-7088.

By Wendy Oaks

Real Estate

Ex NFL Quarterback Bernie Kosar Files Bancruptcy, Ex-wife Sells House

June 21, 2009 jd

Former gridiron great Bernie Kosar, dogged by financial and legal problems, filed for bankruptcy Friday. In the meantime his former wife Babette sold their home for a cool $2,400,000 according to Zillow.com. Kosar’s wife, Babette, divorced him in 2007. Last year, his Bernie Kosar’s Steakhouse went out of business.

Kosar, 45, the former Miami Hurricane and NFL quarterback, filed for Chapter 11, which is generally used by companies to reorganize.

The bankruptcy petition didn’t provide much detail. Boxes were checked off on the petition indicating Kosar has assets estimated between $1 million and $10 million and liabilities of between $10 million and $50 million.

The filing listed Kosar’s largest unsecured creditors, owed a combined $19.5 million. Among them and the amount of their claims: the Cleveland Browns, a team he quarterbacked from 1985 to 1993, nearly $1.5 million; his ex-wife Babette, $3 million; and Jim Ferraro, the owner of the Cleveland Gladiators, an Arena Football League team, $725,000. Kosar is the team’s president.

Other major unsecured creditors include Tampa’s Florida Bank, owed about $9.7 million over some sour real estate investments and Key Bank of Cleveland is owed about $3.1 million.

The filing marks a hard fall for Kosar, the star Hurricanes quarterback in the 1980s who went on to excel in the NFL with the Cleveland Browns before ending his career with the Miami Dolphins in 1996.

Lenders also obtained foreclosure judgments on apartment properties Kosar had an interest in in Tampa, Clearwater and Pinellas Park.

A recent story by Yahoo points out that Kosar needs to mount a comeback. Read Yahoo’s Story about Kosar.

Real Estate

Foreign Investors Optimistic About U.S. Real Estate

June 20, 2009 jd

Foreign real estate investors expect the U.S. real estate market to recover by the end of the second quarter of 2010, according to a survey released Wednesday by the Association of Foreign Investors in Real Estate (AFIRE).

Survey respondents were optimistic about the prospects for good returns, with more than two-thirds planning to invest in U.S. real estate before the end of the year.

About 31 percent said they were more hopeful now about the health of the U.S. real estate market than they were in January, 16 percent said they were more pessimistic, and 53 percent said their opinion had stayed the same.

The 200 members surveyed predicted that Washington, D.C., New York City, and San Francisco would be the first cities to recover, followed by Boston and Los Angeles.

Source: Association of Foreign Investors in Real Estate (06/17/2009

Angel's Dog House Listings

Angels Dog House Listings Molly-Shih-Tzu

June 19, 2009 jd

My name is Molly, I’m a shih-poo, a cross between a shih-Tzu and poodle, but I just like to say I’m Tibetan and French it sounds better if you know what I mean. I’m still a pup I guess, because that’s what I hear all the time, “oh, how old is she, she acts just like pup.”

I’m looking for a green environmental dog house preferable with solar roofing and bamboo floors. I would like a deck running along the front of the house because I love l to just sit and watch the birds and listen to the crickets. I’m a good watch dog.

In the meantime, I have a really nice house my mom and I live in and I sleep with her every night since I was born, I like it that way.

My mom is a singing teacher; she loves to sing too, my job is to greet all the students at the door and to make them comfortable before they start their lessons. So I jump in their laps and lick their faces. I’m pretty tried by the end of the day.

doggie-dreams-dog-house
Photo courtersy of Doggy Dream Homes
All we need are solar panels on the roof and it’ll be just what Molly wants.

Mom and I are so close that she hardly goes anywhere without me, we have been kicked out of a lot of places.

I love to play tricks on mom and when she is sitting at the computer playing Mafia Wars, on Facebook, I get bored. I start talking to her, I speak englis, she thinks I want to go outside because she isn’t paying attention so she gets up from the computer, but I just want her to chase me around the house and play ball, this always makes her laugh so hard.

My most favorite times ever is when we take our road trips to the town of Sonoma. Boy do I have a ball because dogs are welcome everywhere, I see and do things that I have never seen in my life before. I heard a dog say “being here is just like living in France.” Wow, I was impressed!

Story by Louise DeLucchi

Send us a picture of your dog and a little story and we’ll post on this website. Send your information to: E-mail Angel

If you are looking to buy or sell a home E- Mail John O’Dell

Real Estate

Sued for Fraud – Stewart Title and Heritage Oaks Bank

June 18, 2009 jd

scammed
Investors have filed a lawsuit against Stewart Title Company and Heritage Oaks Bank (HOB) alleging they aided and abetted or conspired with Hurst Financial Inc. (HFI) in defrauding hundreds of seniors through illegal investment schemes.

According to Cal Coast News

“The suit filed by more than 300 investors against Stewart Title, HOB, and HFI lists eight complaints including conspiracy, fraud, financial elder abuse, and negligence. Investors are seeking punitive as well as compensatory damages.

Late last month, the FBI seized assets of (HFI) President Jay Miller’s home because of allegations of racketeering, money laundering, and wire fraud, according to a seizure warrant. The suit alleges HFI could not have engaged in a “Ponzi scheme” without the “joint effort, cooperation, and planning” of Stewart Title.

San Diego based attorneys Steven Sanchez and David Noonan, of the law firm of Kirby Noonan Lance and Hodge, claim that Stewart Title, working alongside HFI, siphoned money from investor loans to place in the pockets of HFI principles Miller and his daughter Courtney Brard. Sanchez cites examples of the title company creating false escrows, falsely closing active escrows, and illegally filing clean title reports before placing additional loans on already encumbered properties.

In addition, Stewart Title failed to notify investors when they discovered the fraudulent dealings following an internal audit and interviews that were spurred by numerous lawsuits and allegations of illegal activity “

According to the article, more than 1,000 people invested in this scheme, most of them seniors, resulting in over $100 million unaccounted for.

It’s amazing how investors get involved in schemes which promise a high return. The higher the interest rate that you are promised, the more risk that you are taking. When times are good and everyone seems to be getting rich, people want to get into the action.

The lesson here is as before, check very carefully before you invest your money. Remember, If it’s too good to be true, it probably is.

Nevada County Information, Recreation

Ed Scofield Inducted into Hall of Fame

June 17, 2009 jd

Ed Scofield has been named as the 2009 inductee into the Nevada County Fair’s Hall of Fame. The Fair’s Board of Directors chose Ed for this honor because of his support, dedication and commitment, which is evident throughout the Fairgrounds today.

Scofield retired at the end of 2008 after serving as the CEO of the Fairgrounds for 26 years. During his tenure, he helped the Fairgrounds become visible as one of the top ten outstanding rural fairs in America, oversaw the formation of the Draft Horse Classic and the Country Christmas Faire, and fostered the partnership with Music in the Mountains and their concert seasons at the Fairgrounds. Within the Fair industry he has served as Past President of the Western Fairs Association and was elected to the Western Fair’s prestigious Hall of Fame for contributions to the Fair industry.

“Ed has provided vision and leadership to the Fairgrounds, and he has been instrumental in creating the venues that we all enjoy today,” said CEO Sandy Woods. “He is admired and respected by many and it is a well-deserved honor for Ed to be named to the Hall of Fame.”
A native in Nevada County, Ed has been active in the community from an early age, starting in leadership roles in 4H.

Most recently, he was elected to the Nevada County Board of Supervisors. He has also served his community as a big brother in the Big Brothers Big Sisters program; Past President of the Grass Valley/Nevada County Chamber of Commerce; Past President of Grass Valley Rotary; and as a former Grass Valley City Council member.

Ed will be formally inducted into the Hall of Fame at opening day ceremonies on Wednesday, August 12. In addition to access to the Fair and its many activities, he will receive a portrait donated by Schaffers Originals.

For more information about the Nevada County Fair, August 12 – 16, call 273-6217 or visit Nevada County Fair